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Mr. Gary. Therefore that amount you referred to would not apply to the 40-foot boat program that you are requesting now?
Admiral O'NEILL. That is the saving on the original 120 40-foot program which has been completed.
Mr. Gary. And you contemplate using that for the Westwind? Admiral O'NEILL. Yes; with the concurrence of the committee.
OVERSEAS CONSTRUCTION PROGRAM Mr. Gary. Admiral, it has been my privilege to visit the vast majority of the Coast Guard installations. In our recent Pacific trip I covered most of the Pacific installations. I had previously visited most of the districts in the United States, and I want to join with other members of this committee in saying that the more I visit the Coast Guard operations the greater respect I have for the personnel—that means the officer personnel as well as the enlisted men-I think the organization is exceptionally well run. You are operating with great efficiency and also with great economy, and I am particularly pleased with the attitude of the Coast Guard so far as economy is concerned. However, there were several things that came to light during our recent trip that we shall take up next year, and I hope the Coast Guard will be prepared, to go into them. Particularly I was impressed by the fact that some of the loran stations, all of which are located at isolated points on beaches, near the water, where there is great humidity in the air-a number of them are of temporary construction, such as metal Quonset huts which are corroding, and rusting very badly.
I think the upkeep on some of those buildings is going to be unreasonably high, because of the type of material. It seems to me that if those loran installations are going to be permanent locationsit is about time now that that question is being determined—that more permanent structures should be built to house them. You have very expensive equipment in those operations. In a great many instances they are very poorly housed with temporary housing. Then, even in some of your more permanent construction the rusting of various window facings is very noticeable, which raises a question as to whether your engineering department is using proper specifications as to the materials which are going into even some of your permanent buildings.
We went to one building where they had cement construction. It was hardly completed, and yet the window frames showed very definite signs of deterioration.
I have no doubt that Admiral McElligott has made a report to you on this subject, because he and I both agreed that there should be a study of your entire building program in so far as the loran stations are concerned.
Of course, we will not go into those discussions at the present time, but I hope that your engineers and others will be prepared to discuss them next year when you come up for the 1954 appropriations.
Admiral O'NEILL. Well, I am very glad to have your comments and observations, Mr. Chairman. We will be prepared on that. We will take measures on that.
Mr. CANFIELD. Mr. Chairman, I desire to comment on your statement and its documentation.
I am inclined to think perhaps the Coast Guard in using Quonset huts and other material it has used has tried sincerely to save money for the taxpayers of our country. No doubt the guard will be glad to hear the comments in these hearings today.
Mr. Gary. Let me say there that what I said here was to be taken in no sense as criticism of the program, because I can well imagine that loran, being a new development, caused you to hesitate at first in installing permanent construction.
Admiral O'NEILL. That is true, Mr. Chairman.
Mr. Gary. But my statement now was in the nature of a suggestion, that now the time has come to really consider this program of construction for those stations. Without any criticism at all, we want to discuss it with you next year. You may have the answers to completely satisfy us, but I am just warning you we are going to ask a lot of questions about it next year. I hope your engineering department will do a little research of its own in the meantime and be prepared to answer these questions.
Admiral O'NEILL. We will be. Mr. CANFIELD. Mr. Chairman, I understood the purpose of your statement, and I am really glad you made it, because loran is definitely here to stay. I was impressed by the testimony given by our military leadership in the Pacific and by commercial aviators wherever we saw them on the extreme importance of loran to their operations.
Admiral O'NEILL. It has been very gratifying to us, and most helpful, that this committee has visited so many Coast Guard installations and met so many of the personnel, seen our units and where they are located, of every type and description that we have, and how they operate.
This recent trip of the committee, which was a very rigorous one, on a very tight schedule, covered, as I understand it, about 31,000 miles, and the committee visited many of our installations in the Pacific never before visited by Members of Congress. That was a great help to the morale of the men stationed there.
The comments and observations of the committee as to the conditions observed there will be most helpful to the Coast Guard in our plans and activities.
Mr. Gary. Thank you, Admiral. I will say I am sure that some of the installations which we visited have never been visited by Members of the Congress before, and I can assure you that there is one Member of the Congress who is not particularly anxious to visit several of them again.
Thank you, gentlemen.
WEDNESDAY, MAY 28, 1952. RECONSTRUCTION FINANCE CORPORATION
WITNESSES HARRY A. MCDONALD, ADMINISTRATOR SOLIS HORWITZ, GENERAL COUNSEL DON S. BURROWS, CONTROLLER LELAND E. SPENCER, CHIEF, SYNTHETIC RUBBER DIVISION,
OFFICE OF PRODUCTION DOUGLAS S. WILSON, CHIEF, REPORTS DIVISION, OFFICE OF THE
CONTROLLER 8. T. MASON, BUDGET OFFICER
Mr. Gery. The committee will come to order.
We will take up this afternoon the annual operating budget request for the Reconstruction Finance Corporation for the fiscal year 1953. This is not a request for an appropriation but rather a limitation on the amount the Corporation can use from its own receipts for administrative expenses.
We will insert page 1 of the justifications at this point in the record. (The matter referred to follows:)
Administrative expenses Authorization for 1952 (Public Law 253) -
-- $17, 750,000 Pay increases, 1952 (Public Law 201)-------- ------ $1, 185, 000 . 1, 185, 000
Deduct: Estimated savings, 1952.
Net estimated savings, 1952.Estimated expenses, 1952.-Estimated expenses, 1953.-----
18, 935, 000 --------1, 435, 000 – 1, 435, 000
17, 500, 000 16, 850, 000
ANALYSIS OF CHANGE IN ESTIMATES Estimate, 1952...
-- 17, 500,000 Estimated decreases: 1. Decrease in staff assigned to new loan activity----
277, 000 2. Travel and other nonrecurring expenses in disaster loan
Net decrease------- ----
trative property --
50, 000 164, 000 130, 000 113, 000 87, 000
16, 639, 000
8. Net increase in administrative staff, production programs.
115, 000 50,000 23, 000 23, 000
16, 850, 000
Estimate, 1953. ----20553—52—pt. 1- 3
STATEMENT OF EMPLOYMENT, 1952 ANE 1953
by program, and obligations by objects, appearing on pages 121 and 122 of the justifications.
(The matter referred to follows:)
(H. Doc. No. 461, 820 Cong., 2d sess.) COMMUNICATION FROM THE PRESIDENT OF THE UNITED STATES TRANSMITTING
A PROPOSED REVISION IN THE LIMITATION ON ADMINISTRATIVE EXPENSES FOR THE FISCAL YEAR 1953, INVOLVING A REDUCTION IN THE AMOUNT OF $1,650,000, FOR THE RECONSTRUCTION FINANCE CORPORATION
THE WHITE HOUSE,
Washington, May 9, 1952. The SPEAKER OF THE HOUSE OF REPRESENTATIVES.
Sir: I have the honor to transmit herewith for the consideration of the Congress a proposed revision in the limitation on administrative expenses for the fiscal year 1953, involving a reduction in the amount of $1,650,000, for the Reconstruction Finance Corporation, in the form of an amendment to the budget for said fiscal year.
The details of this proposed amendment, the necessity therefor, and the reasons for its submission at this time are set forth in the attached letter from the Director of the Bureau of the Budget, with whose comments and observations thereon I concur. Respectfully yours,
HARRY S. TRUMAN.. EXECUTIVE OFFICE OF THE PRESIDENT,
BUREAU OF THE BUDGET,
Washington 25, D. C., May 9, 1952. : The PRESIDENT,
The White House. SIR: I have the honor to submit herewith for your consideration a proposed revision in the limitation on administrative expenses for the fiscal year 1953, involving a reduction in the amount of $1,650,000, for the Reconstruction Finance Corporation, in the form of an amendment to the budget for said fiscal year, as follows:
Independent offices—Reconstruction Finance Corporation ,
This proposed revision in the limitation on administrative expenses results from changes since the budget was originally submitted in the estimated number of business loans to be approved and serviced, and in the quantity of synthetic rubber to be produced.
At the time the budget was transmitted to the Congress, it was anticipated that by early spring there would be a substantial increase in the number of business loans. Since the expected increase has not materialized, it is now estimated that the business loans to be approved and serviced during fiscal year 1953 will be 1,500 and 5,700, respectively, instead of 2,600 and 6,040.
The production of synthetic rubber is expected to decrease from 950,000 to 765.000 long tons. This decrease in synthetic-rubber production is attributable to a greater quantity of natural rubber for industrial purposes because of the improved position of the stockpile, and a substantial decrease in the price of natural rubber.
I recommend that the foregoing proposed revision be transmitted to the Congress. Respectfully yours,
F. J. Lawton, . Director of the Bureau of the Budget.