2 Senator BANKHEAD. You may go ahead, now, Senator McKellar, with your testimony before the subcommittee in your own way. STATEMENT OF HON. KENNETH MCKELLAR, A UNITED STATES Senator MCKELLAR. Mr. Chairman, the first section of this bill provides that hereafter, or rather after the 1st of July, the first and second section provides that after the 1st of July the right of eminent domain shall be exercised by the T. V. A. exactly as all other Government takings of land are exercised. At the present, under the provision in the original act, the commission shall be established providing for the taking of land before a committee or commission selected by the parties under certain circumstances, and in my judgment that is not fair to the landowners, to the taxpayers, and is not fair to the other organizations of the Federal Government having the right of domain. The others have to go before the courts and the juries of the land in the regular way. This is an exception that was put in the original act, as I recall and I will have to get that particular provision of the act and put it in the record--this is merely to restore the method of condemnation in the T. V. A. that now exists in all other departments of the Government. So much for that. Senator AIKEN. Is there dominion set up by the State public service commission, which gives them the right of eminent domain, and these other rights to which you have referred? Senator MCKELLAR. No. It is set up in the T. V. A. itself. Senator BANKHEAD. The act creating the T. V. A. set it up. Senator AIKEN. Who would it go before under this amendment if it would not go before the State public service commission which I take, from your statement, it would not. What court, or what agency, or what body would operate for that purpose? Senator MCKELLAR. Any Federal court or State court, either. I will have to find that paragraph. Senator AIKEN. That is not necessary, Senator. I just wanted to get that information. Senator BULow. Does the Commission now hear these condemnation proceedings, or does it appoint a subcommission for that purpose? Senator MCKELLAR. They have their own. They really hear it before themselves. you mean there. Senator BULOW. I see what Senator MCKELLAR. It appoints a subcommission for that purpose and the purpose of this act is to put it on an equality with the others. Senator A'KEN. That is, it hears itself in arguments with regard to these matters, in effect? Senator MCKELLAR. That is true, Senator. Gentlemen, the next section is the more important one. SEC. 26. Commencing July 1, 1942, all proceeds derived by the Board from the sale of power or any other products manufactured by the Corporation, and from any other activities of the Corporation, including the disposition of any real or personal property, shall be paid into the Treasury of the United States monthly, and shall not be expended until subsequently appropriated by the Congress. And, another section, which is section No. 27: SEC. 27. There are hereby authorized to be appropriated, out of the Treasury of the United States, such sums as may be necessary (1) to pay tht expenses of the Corporation in its operations and the conduct of its business, (2) to provide an emergency fund not in excess of $1,000,000 at any one time which shall be available to the Board to defray emergency expenses and insure continuous operation, and (3) to otherwise carry out the provisions of this Act, but the Authority shall report any uses of said emergency fund on the first of January and first of July each year. Mr. Chairman, the T. V. A. was started in 1933, as I am sure you will all recall. They first built the Norris Dam, and then we built the Wheeler Dam, as I recall it. Work on the completion of the Wilson Dam had been begun and the Wilson Dam had been, incidentally, completed before and turned over to the power company under lease, or some other contract. When the T. V. A. Authority took charge, when they first built the Norris Dam, then the Wheeler Dam, and then Mr. A. E. Morgan, of that company, announced to me that they would build no more dams, that the purpose of the T. V. A. was not to build dams in opposition or in competition with the private power companies but to furnish a yardstick with which to measure the rates for power. I told him very frankly in my office that he did not know the purposes of the T. V. A., that I knew something about it, and that was not its purpose. He said that the underlying purposes of the T. V. A. was to bring up the poor, benighted, and ignorant people of east Tennessee to some sort of cultural plane at least partially equal to that of the people of the rest of the country and that in no sense was it expected to come in competition with private power companies. It was upon that statement that, as you-well, I believe Senator Bankhead was the only member present that was on the Appropriations Committee at the time-it was that statement of Dr. Morgan, a statement which was concurred in by Mr. Lilienthal and Dr. Morgan, and it was no secret, it was well understood and published at the time; it was upon that statement that I undertook to build the dam at Pickwick and later on at Guntersville, Ala., Chickamauga, and Gilbertsville, Ky., Watts Bar, and Fort Loudoun. All of those dams were built not only over the opposition of the T. V. A., and members of the T. V. A., but against the lobbying of Dr. A. E. Morgan. I had to send for him and tell him that if he didn't get out of town along when the Gilbertsville and Pickwick Dam was coming up that I would certainly have something to say about it on the floor of the Senate. And so, these other dams were built not by direction of the T. V. A., but in spite of the T. V. A. members, and over their intense opposition. Senator AIKEN. Do you mean Dr. Morgan did not favor the building of these additional dams? Senator McKELLAR. No one of them favored it. We got no recommendation of the T. V. A. to build any of these other dams except the Norris and Wheeler Dams. Senator AIKEN. What years were those? Senator MCKELLAR. 1934, 1935, 1936, 1937, 1938, 1939, and 1940. Senator AIKEN. Who were the members of the Commission? Senator MCKELLAR. David E. Lilienthal or Arthur Lilienthal-I have forgotten which—and Dr. H. A. Morgan. I might add that my good friend, Senator Pope, wrote me a letter in which he said he was now a member of the Commission in place of Dr. A. E. Morgan, and he wrote me a letter and it is my recollection that he said I will produce the letter later if it is necessary, or denied, in which he said that we could not win the war unless the Douglas Dam was built. Of course, that is a matter of opinion but that is his opinion, and there is no point in going into that further. That brings me down to making this statement that the Senator BULOW (interposing). If I may interrupt a moment to make this inquiry, Senator McKellar. Senator MCKELLAR. Will you just permit me a minute further and then I will be happy to yield to you. Senator BULOW. By all means, Senator McKellar. Senator MCKELLAR. After they bought all of these power companies in Memphis, Nashville, Chattanooga, Knoxville, and other points in the State it became a tremendous business. It brings in a tremendous amount of money, how much I do not know exactly but my recollection is that the last fiscal year showed something like $21,000,000. That money is not put into the Treasury of the United States like the money coming in from other government corporations. It is used as a fund down there. Senator AIKEN. Is that $21,000,000 over operating expenses? Senator MCKELLAR. $11,000,000 over operating expenses. The operating expenses, as I understand it, it is difficult to find out what the exact figures are; however, as I understand the report it is about $11,000,000 clear money. I do not know. No one knows except the T. V. A. Furthermore, a short time ago, Mr. Gordon R. Clapp, who is General Manager of the Tennessee Valley Authority, came before the Appropriations Committee of the Senate and gave some very interesting testimony concerning expenditures. The first one I want to call this committee's attention to is to be found on page 278 first, let me say that this is one of the most remarkable documents that was ever presented to any committee. Mind you, this tremendous corporation, this tremendous amount of gross income, this tremendous amount of net income, keeping that in mind, you will note that Mr. Clapp was questioned as to certain phases of it and the reason he was questioned as to certain phases of it was because we were questioning these particular matters in all departments. I found Mr. Clapp reading from a statement that he had in his hand, and I asked him to make the statement a part of the record, and he did so. It is on page 278 of the Interior Appropriations Committee hearings on H. R. 6430 in the Senate. He was asked what the expenses, traveling expenses, and traveling pay of the T. V. A. were. The House of Representatives and the Senate together bring their men from all over the world, I believe two of them as far as the Philippine Islands, and for this movement there is appropriated each year $222,000 or at least about that. I think last year it was $222,000. It is about that every year, for the traveling pay of all the Senators and Congressmen, 535 men. What about the T. V. A.? I asked for the travel expenses and pay, and here was the first that I got. I want to read it, Mr. Chairman, The result of that was, now, that the Senate directed the construction of these dams. There was no recommendation by the Tennessee Valley Authority for the building of the list of dams that I have enumerated. There was no recommendation by the President. There was no recommendation by the House committee. There was no recommendation by the Budget. And, as I say, there was no recommendation by the House committee. All of the bills passed without any of those dams that I have enumerated in them, and when they came to the Senate I offered that as an amendment, which amendment, the several amendments the Tennessee Valley Authority opposed. I understand that some of them are very proud of what has been accomplished down there, but they opposed the building of those dams and had Arthur E. Morgan here specifically to lobby against them. Nevertheless, they were put in, as Senator Bankhead will remember because he took part in helping to put them in, took a very conspicuous part. Of course, they were put in by the Members of the Senate and because of the fact that I happen to be one of the conferees I think that has something to do with it. Of course, it was the Senate itself that was acting. For that reason, and, by the way, the Senate committee was almost equally divided. It think it was, for the most part, just one difference. Some of them were not at all strong about the thing. However, I want to say that in that case no set of men ever acted in a finer way in building that set of dams. What in the world would we have done without them, and would we do at the present time? If they had not been built what would we have done? However, we were able to build them and they were built and we have them now, thank God, to make power for the manufacturing of ammunition in east Tennessee. It was done in spite of-with the exception of one man of the Tennessee Valley Authority, and over their, to my mind, wicked protests. You may wonder why I now want to bring that up. Perhaps, I should go a little farther into the history of this matter before making any other statement. Later on we all remember the controversy between the private power companies and the T. V. A. after those dams were being built, which brought about many conferences and finally the purchasing, by the T. V. A. of most of the power companies in Tennessee, all except those in upper east Tennessee and in the places, by the way, or in the part of the State in which the Watauga Dam and the Holston Dam are now being placed and being placed, by the way, over the objection and after Mr. Lilienthal had recommended against it, and over the intense opposition of the T. V. A. and its board of directors. They did not want to build them there. They first recommended that they be built there and then they found another dam site that suited them better and it was apparent that they were very much opposed to building them there. They were authorized by the Congress and are now in the building. Some work has been done on those two dams, how much I do not know, but I understand that most of the workers have been removed from the Watauga Dam and the Holston Dam and moved to the Douglas Dam, so-called. and I want to put the same exhibit in the record at this place, but I now want to read it and comment on it. In fact, it is rather short and I will just read it into the record now, and then comment at some length upon certain of the items therein Tennessee Valley Authority direct travel expenses by departments, 1948 and 1942 [This includes fares paid common carriers and per diem] Chief engineer, travel for last year, I presume on railroad lines. It is railroad lines as I understand it, although perhaps it is on airplanes, I am not sure whether any of it is for outside automobiles or not. Maybe sometime, occasionally, they have had their own automobiles or hired another; The chief engineer, $3,000 in 1942, and also $3,000 for 1943. The next item we come to is that of construction. There we find an allotment for construction; whatever that means, I am sure I do not know; travel pay and per diem for construction $112,583 for 1942, as is shown on this paper; and $66,028 for this year, 1943. Design-I do not know whether it is for fan dancers or what other type of design; but design, $63,000 for last year and $53,700 for the coming year. Water-control planning, $68,000 for last year and $47,000 for this year. Manager of power; and the manager of power may be Julius A. Krug, who was the manager of power, $21,000 last year, and who has been allotted $21,000 for this year. Power operation, I do not know whether that is Mr. Krug or not, $80,000 for last year and $80,000 again for this year. Power utilization, $21,778 for last year and $20,351 for this year. Power engineering and construction, $140,000 for last year and this coming year $160,000. Chief Conservation Engineer, $700 this year and $700 for the past year. The Chief of conservation must be in the "doghouse." There is no other item like this on it except the splendidly conducted office here in Washington, to which I will refer in a moment. I cannot imagine what is the matter with the Chief Conservation Engineer, which would have caused him to be slighted in this way. Agricultural relations, $20,924 last year and $33,713 this year. |