of their records on the identical facts before they discovered that under the statute they didn't in their opinion have any reason to submit? Do you understand my question? Mr. POWERS. No, sir; I don't. Mr. RIVERS. Have General Motors submitted to the request by you on the identical facts until they found out the provisions of this statute to which they referred? Mr. POWERS. We had previously, Mr. Rivers, reviewed some of General Motors other operations. So far as we know, this is the first time in which the legal authority of the General Accounting Office was questioned with respect to when after a Government contract is signed we could examine into that contract. Mr. RIVERS. Now, if this thing is upheld, what will be the position of the General Accounting Office in the future on your procedural questions? Will it revolutionize them, or throw them into chaos? What will happen to your procedures? Mr. GAVIN. Make it brief because we have to go. Mr. POWERS. If there is any problem whatsoever, in my opinion, on our ability to enforce the provisions of this particular statute, it would jeopardize our entire audit and right to perform our statutory responsibility. Mr. HÉBERT. All right, Mr. Gavin. Mr. GAVIN. You brought this case to our attention of General Motors. Now, are you going to bring us any other cases? Is the Comptroller General going to present other cases to us at this time? Mr. POWERS. As the chairman and this committee knows from our previous testimony, the Comptroller General of the United States has taken action to extend and accelerate our activities into the review and examination of negotiated type contracts. As soon as our reviews and examinations are completed, and reports are prepared on them, they will be promptly brought to the attention of the Congress for consideration. Mr. GAVIN. Thank you. Mr. HÉBERT. The committee will stand in recess until next Monday at 10 o'clock. Mr. COURTNEY. Thank you very much, Mr. Powers. (Whereupon, at 12: 18 p. m., the subcommittee adjourned.) STUDY OF AIR FORCE CONTRACT AF33 (038)-18503, GENERAL MOTORS CORP., BUICK-OLDSMOBILE-PONTIAC ASSEMBLY DIVISION FRIDAY, JULY 26, 1957 HOUSE OF REPRESENTATIVES, SUBCOMMITTEE FOR SPECIAL INVESTIGATIONS, EXECUTIVE SESSION Washington, D. C. The subcommittee met at 10 a. m. in executive session, Hon. F. Edward Hébert presiding with the following members of the subcommittee present: William E. Hess, Leon H. Gavin, L. Mendel Rivers, Paul Cunningham, William H. Bates, Porter Hardy, Jr., Frank C. Osmer, Jr., George P. Miller. By unanimous consent the subcommittee authorized the chairman to communicate with the president of General Motors Corp. concerning the refusal of that corporation to allow representatives of the Comptroller General of the United States to have access to and examine books of the corporation relating to Government contracts and in particular contracts relating to the Cadillac division. In pursuance of that authority and direction the following tele gram was sent: HARLOW H. CURTICE, President, General Motors Corp., Detroit, Mich. : JULY 26, 1957. Subcommittee for Special Investigations, House Armed Services Committee, authorized by House Resolution 67, 85th Congress, has been advised by Comptroller General of United States that your company has refused access and examination of your corporation's books and records relating to Government contracts currently being performed by divisions of General Motors Corp. Particular instance relates to Cadillac division. Subcommittee requests your appearance to hear your company's position and policy on this subject and matters related thereto. Advise by return wire your availability. F. EDWARD HÉBERT, Chairman, Subcommittee for Special Investigations. The following answer was thereupon made by the president of General Motors Corp.: Hon. F. EDWARD HÉBERT, JULY 26, 1957. Chairman, Subcommittee for Special Investigations, House Armed Services Committee, Old House Office Building, Washington, D. C.: My secretary has communicated to me the contents of your telegram of this date. I have also been advised of the fact with respect to the issue between the Comptroller General and our Cadillac division involving the availability of books and records relating to a Government contract currently being performed by 2609 that division. However, I had no knowledge of these facts prior to today, except possibly the receipt of the letter dated April 26, 1957, addressed to me by the Comptroller General. I have no present recollection of the receipt of that letter. In the normal course it would have been referred initially by a member of my office staff or myself to Cadillac division or the general counsel for reply or for further consideration by me or for subsequent consideration by me if that were deemed necessary. I am told that this is a four-page letter dealing with a legal issue and interpretations of the statutes relating to the availability of records of Government contractors for this reason apparently the letter was referred to our general counsel. I did not see the followup letter of June 3, but I was told it was sent directly to the general counsel by a member of my office staff. I am now advised that yesterday the general counsel, who left on a business trip to the West Coast this morning prepared a reply to the April 26 letter which was mailed to the Comptroller General this morning. This letter I am informed after stating certain facts concludes with a statement "if, despite the foregoing you still feel that the performance of your duties requires you to conduct at this time an audit of partially completed contract DA-33-019-Ord-2017, we are agreeable that you come to the Cadillac Cleveland ordnance plant and conduct such audit of this contract as you may deem necessary." I have given instruction to have copy of that letter delivered to you by our Washington office tomorrow morning. I know of no request made by or on behalf of the Comptroller General upon any other division of the corporation for access to and examination of their books and records relating to Government contracts currently being performed. If the Comptroller General desires such access or examination of any such records and so advises us the records will be made available. The foregoing represents the only information that I can present on the matter and accordingly I feel I could not make any further contribution by appearing before your committee. However if you feel otherwise, I shall be returning from my vacation in New England to Detroit on August 5, after which a mutually acceptable date for my appearance can be arranged. My secretary is being authorized to sign this telegram to you over my signature. HARLOW H. CURTICE, President, General Motors Corp. The chairman of the subcommittee thereupon sent the following telegram: Mr. HARLOW H. CURTICE, President, General Motors Corp., Detroit, Mich. JULY 29, 1957. Your telegram in response to mine is acknowledged with your decision to make available to Comptroller General, Government contract records of Cadillac division and agreeing that all books and records relating to Government contracts in any other divisions will be available on request. Comptroller General is being so advised today. F. EDW. HÉBERT, Chairman. The telegram of the General Motors Corp. has been communicated to the Comptroller General of the United States. (The following letter was received from the Comptroller General :) COMPTROLLER GENERAL OF THE UNITED STATES, Hon. F. EDWARD HÉBERT, DEAR MR. CHAIRMAN: Thank you for your letter dated August 20, 1957, advising of the exchange of telegrams between the president of General Motors Corp. and yourself concerning the failure of one of the divisions of the General Motors to permit access to its books and records by the General Accounting Office. I want you to know that we greatly appreciate the assistance rendered by your subcommittee in bringing this matter to a satisfactory conclusion. Sincerely yours, JOSEPH CAMPBELL, Comptroller General of the United States, STUDY OF AIR FORCE CONTRACT AF33(038)-18503, GENERAL MOTORS CORP., BUICK-OLDSMOBILE-PONTIAC ASSEMBLY DIVISION THURSDAY, AUGUST 15, 1957 HOUSE OF REPRESENTATIVES, SUBCOMMITTEE FOR SPECIAL INVESTIGATIONS, Washington, D. C. The subcommittee met at 10 a. m., the Hon. F. Edward Hébert, chairman of the subcommittee, presiding, with the following members present: Mr. Gavin, Mr. Rivers, Mr. Cunningham, Mr. Bates, Mr. Hardy, Mr. Osmers, Mr. Miller, and Mr. Arends. Mr. HÉBERT. The committee will be in order. Mr. Courtney, we have invited representatives of General Motors to be here today. Do you know if they are here? Mr. COURTNEY. We have a response from General Motors. Are you Mr. POWER. This is Mr. Gordon. My name is Power. Mr. COURTNEY. You are Mr. John F. Gordon, vice president of General Motors? Mr. GORDON. That is right. Mr. POWER. Yes, sir. Mr. COURTNEY. Buick-Oldsmobile division? Mr. POWER. That is right; my name is A. F. Power, assistant general counsel. Mr. COURTNEY. Of General Motors Corp.? Mr. POWER. General Motors Corp. Mr. HÉBERT. Gentlemen of General Motors, I address myself to you now. I just want the record to show this. I am addressing this to you. The purpose of inviting you here today is for you to listen firsthand to the testimony which will be offered by the staff of this committee, and the deductions and conclusions reached by the staff. After the presentation by the staff, I want you to feel free to come forward and make any comment that you desire to make on the testimony which is brought before the committee in the public hearing. Mr. POWER. Thank you very much. Mr. HÉBERT. I want to assure you that you will be given every opportunity to make any comment you desire to anything that is said by the staff or by members of the committee. There will be no attempt. on the part of the chairman or the committee, in any manner, shape, or form, to cut you off in rebuttal or disagreement as to what is presented here, at any time during the discussion of this particular contract. Is that understood? |