also with respect to the expanding economy and the security of our Nation. Many people believe that there is little advantage in having the friendship of certain nations who own or control areas where in peacetime we can get certain materials such as the Malay States for tin, Burma for tungsten, and certain African nations for other materials, if in time of war, the lines of transportation would be closed. If you will just proceed to give us the benefit of your experience and knowledge in this field, we would be very appreciative.

STATEMENT OF REPRESENTATIVE THOMAS E. MARTIN

Representative MARTIN. My name is Thomas E. Martin, Member of Congress, representing the First Iowa District.

Prior to my going to Congress I had served as an assistant professor of military science and tactics at the University of Iowa-that is many years before I went to Congress. When I taught military science and tactics, I gave special study to the essentials of national defense and in the course of that work I readily recognized that the basic materials needed for building of armaments and ammunition supplies were the beginning point of adequate national defense.

I wasn't the first to discover that point by any means. The historians will back me up on that.

I might suggest that those who are interested in the recognition of that point in history might read de Tocqueville, the French historian. His writings on democracy in America in 1835 drew the world's attention to the fact that Russia and America were, primarily, by their differences in their temperaments and approach to governmental work, were destined to be at each other's throats, and because of their supplies of materials primarily, they were destined, each of them, to rule half the earth.

That background explains why I, as a Representative of a cornhog district, started looking about the problems of preparedness immediately upon my going into Congress in 1939.

I was assigned to the Committee on Military Affairs. I found there was no law recognizing the importance of the mining industry or of the stockpile of strategic and critical materials on our books and there never had been a law of that kind.

The first task I undertook in starting my service in the Committee on Military Affairs in January 1939, was to work for the enactment of such a law.

Prior to my going to Congress, a Congressman from Pennsylvania by the name of Faddis, had such a bill for Congress for about 4 years. We took up the Faddis bill early in 1939 and from it and other similar bills, we developed Public Law 117 of the 76th Congress, which was enacted into law along in May of 1939.

Because of my study in connection with the bill, I was placed on the committee on conference between the House and Senate, notwithstanding the fact that it was the first 3 months of my service in Congress. So I know from that special study fairly well what went into the first Stockpile Act. I recall that I signed the minority committee report in connection with Public Law 117. It was the first such minority report that I had signed in my congressional service. The point in dispute as between the majority party which was then the

Democratic Party, and the Republican Party representatives on that committee was whether or not the "Buy American" clause should go into Public Law 117.

We fought that out at great length in the committee on conference. and we succeeded in getting a "Buy American" clause into Public Law 117 in 1939.

Public Law 117 was a very modest beginning of stockpiling, approximately $100 million of stockpile. That was, of course, ridiculously low because in January to May 1939, we were on notice that the world was rather troubled although World War II had not yet started.

In February 1941, the Committee on Military Affairs realized that the administrative agencies charged with the administration of Public Law 117 of the 76th Congress had not made much progress. It was so noticeable and so important in our judgment, that we organized a special investigative committee of which Mr. Faddis was the chairman. I was a member of that investigating committee.

We went into the failure-made a study of the failure of stockpiling under Public Law 117.

We were challenged in no uncertain terms at the organization of that committee. President Roosevelt made his famous speech on our preparedness program emphasizing what we had on hand and on order, whereas our complaint was that the materials were not on hand.

The report of our committee criticized the administration in 1941 for not carrying out the spirit and intent of Public Law 117 of the 76th Congress.

Now, may I ask a question off the record?

The CHAIRMAN. Certainly.

Representative MARTIN. Do you want me to put in this record anything further on that? That is the background of Public Law 117. I don't want this on the record unless you want it.

The CHAIRMAN. We would like to have it if it will not be embarrassing to you.

Representative MARTIN. It won't embarrass me at all. It might be embarrassing to the Democrats, but it won't embarrass me. It cost the Democratic chairman of the special committee his job in Congress. If you want that to go in the record, I can tell you what happened. Do you want that in the record?

The CHAIRMAN. It is in the record.

Representative MARTIN. You can put it in there. I don't mind in this field, I fear no one.

The CHAIRMAN. I believe we are through fighting this thing with kid gloves.

We will face the issue. If we do not face the issue next year, then it may be too late.

Representative MARTIN. Then I will proceed. In the committee report of July 21, 1941, I prepared one paragraph that stated in general-I do not have it before me and haven't seen it for some time

The CHAIRMAN. This was a special committee?

Representative MARTIN. This was a special committee of the Committee on Military Affairs, appointed to investigate failure of stockpiling under Public Law 117 of the 76th Congress which had been enacted into law approximately 2 years prior to this committee action in 1941.

This paragraph that I prepared, stated in effect that, "It seems to us," the committee, "that the present national administration has gone off the deep end in social reform and has forgotten all about national defense."

That paragraph caused the defeat of Mr. Faddis, chairman of the special committee, and it may be interesting to note how it caused his defeat.

Mr. Faddis represented the congressional district in southwest Pennsylvania-Washington, Pa., was his home. They redistricted in Pennsylvania to place Mr. Faddis over in the edge of J. Buell Snyder's district, long enough to hold the primary election in which J. Buell Snyder, running in his own district, defeated Mr. Faddis in the primary.

Immediately after that defeat, they again redistricted and placed the districts back the way they were before that happened. That ended Mr. Faddis' career in Congress. He resigned from Congress in December 1942, and went to Africa as a colonel in the Reserve.

You can see from this situation, that feeling was rather intense that we had failed to get that stockpile program underway as a nation. The stockpile legislation was weak. The needs of industry for wartime operations were not met by the meager or small operation carried out under Public Law 117, as evidenced by the fact that the RFC took over the buying and acquiring of strategic and critical materials for industry for the war program. The military approach to it had been completely inadequate.

The RFC during World War II, expended approximately $12 billion for strategic and critical materials. At the end of World War II there was a considerable amount of those materials still within the jurisdiction of RFC.

We, on the Military Affairs of the House and of the Senate, then undertook to redevelop the stockpile legislation so that we might be spared repeating the struggle we went through from 1939 to the completion of World War II.

Out of that was developed Public Law 520 of the 79th Congress, signed into law, July 23, 1946. This law, Public Law 520, had its original consideration in the Senate and it came to the Committee on Military Affairs in the House for consideration after it had been passed by the Senate.

The CHAIRMAN. That was in 1946?

Representative MARTIN. In 1946. When the House committee took up consideration of that bill, we discovered a strange paragraph in it-paragraph 10, which provides free trade for all stockpile purchases in foreign trade.

Well, we recognized the source of that—at least we thought we did, as coming from the State Department. On the House committee we struck that section out of the bill. I will trace that one section now before I go ahead with the rest of the bill.

When that bill went to conference between the House and Senate. it happened that Congressman Carl Durham, of North Carolina and I, were not senior enough on the Committee on Military Affairs to be appointed as conferees, notwithstanding the fact that I had been a conferee on the original bill No. 117 in 1939. When the bill came back to the House floor from the conference, I learned of it just before it was to be acted on. I went to the House floor and heard it

was in the chairman's hands-that is, the chairman of the Committee on Military Affairs.

The CHAIRMAN. The conference report?

Representative MARTIN. The conference report, that is right. The conference report was in his hands and the leaders were ready for its approval.

I went immediately to Andrew May, chairman of the committee on the House floor and asked him if he had the conference report and he said he did. I said, "Will you give me a chance to see it before you bring it up?" He said, "It is already on the Speaker's desk."

I went to the Speaker, Sam Rayburn, and asked him for it and I looked immediately to see if section 10 was in that bill and it was back in the bill. I have always thought that was why Carl Durham and I did not get on the conference committee, but section 10 providing for free trade in stockpiling acquisition was back in the bill and I registered a very vigorous objection to Chairman Andrew May.

I went to the Speaker and asked him to hold up consideration on it and he asked me to see other congressional leaders and apprise them of my desires in the matter, which I did, on both sides of the aisle.

The outcome of about 20 minutes of rather strenuous work was that the committee took back and asked for the reassignment of the conference report to the conferees for further consideration. It was taken back and brought back to the House and the Senate without. section 10 in it. Then it passed into law. That is on the one point of tariff and the stockpile.

The CHAIRMAN. Right at that point, and I don't want to interrupt your line of thought as I think it shows a trend.

There was an interpretation of a certain Executive order that when certain materials are imported by the Government, that payment of the tariff is not necessary. This substantiates the general suspicion that an attempt has been made in almost every case to get congressional approval

Representative MARTIN. Exactly, exactly.

The CHAIRMAN. Congress has never approved it; have they?
Representative MARTIN. Not on stockpile legislation.

In my judgment it was not accidental that section 10, which provides for free trade as a matter of law in stockpile legislation, got back into that bill after we had thrown it out in our committee on the original passage of the bill in the House of Representatives.

Well, that is all I care to discuss about the tariff provision. It is not a part of the stockpile legislation, that is, that section providing for free trade in stockpile acquisition in foreign commerce.

It came very close to getting into the law and 15 minutes delay in 1946-that happened in June and you will find there are committee reports and conference committee reports bearing this out. I do not have them with me. I do not have my files with me; I am giving this from memory.

The CHAIRMAN. I wonder if you would, at your convenience, furnish the committee any reports bearing on this particular subject?

Representative MARTIN. I will be very glad to look through my files and see if I cannot get a copy of these reports. I do not have very many of them left. I have worked over them so many years that I lose them occasionally. I will see if I can't locate in my files some copies of them for you.

39888-54-pt. 2——2

Now, there are other important parts in Public Law 520 that I would like to discuss, mainly for the development of the congressional intent and purpose in developing that law.

Paragraph 1 of Public Law 520 of the 79th Congress-that is, the stockpile law, which is still in force and in effect-paragraph 1 recognized the prior importance of a healthy and vigorous mining industry as paramount to the stockpile itself.

Another paragraph in this law provided for the application of Buy American clause to the stockpile purchases. Another paragraph in that law provided for the transfer to the stockpile of surplus strategic materials-strategic and critical materials that were held by Government agencies, but in that section we placed a loophole and made that contingent upon the needs of industry for those materials and through that loophole practically all of the strategic and critical materials held by other Government agencies were channeled into industry rather than into the stockpile.

The CHAIRMAN. Does that account for the dumping of foreign lead and zinc and other materials into this country which broke the domestic market? For example, England recently found it had a surplus of lead. Suddenly there was an influx of lead into the United States which broke the market. Is that what you are now discussing?

Representative MARTIN. I do not recall what strategic and critical materials were in the supplies held by other governmental agencies but it did reflect to me the prevailing policy advocated at the instance of the users of these materials to divert all materials in governmental agencies' possessions into channels of industry regardless of the impact of that on the mining industry at that time and that, in a sense, is similar to that problem which confronts us today in the handling of items in distress.

I think it is an interesting sidelight that through that loophole in Public Law 520, these materials were channeled to industries at the time whereas we had intended the bulk of them to come into the stockpile for two reasons: One was not to depress the market and mining industry and the other was to safeguard our defense through the creation of this stockpile.

The CHAIRMAN. As I understand your explanation, this loophole permits the price to be manipulated?

Representative MARTIN. Exactly. A stockpile of these materials that is free from the restrictions placed in Public Law 520 can be a very serious sword of Damocles hanging over the mining industry and that is exactly what happened, in my judgment, because out of all the materials held by the other governmental agencies and primarily the RFC, only approximately $500 million got into the stockpile. They had handled about $12 billion worth of materials through the war. I do not have at hand-I do not know whether I can get it-an inventory of the materials actually on hand by the governmental agencies at the time we wrote this law, but I do know, and it is a matter of record in the Munitions Board reports that we got into the stockpile from all governmental agencies somewhere between $400 million and $500 million of strategic and critical materials.

Now, the reason the using industry, that is, the consuming industry-the reason they made use of that loophole-I mean, tried to get these materials channeled to them without getting them into the