Mr. DONDERO. In the prior report the Board of Engineers were unanimous in recommending it, and the Chief of Engineers was rather opposed to it.

General WHEELER. He left it to the wisdom of the Congress, as I understand his report. He did not accept the savings from the diversion of upbound traffic on the Mississippi River.

Mr. DONDERO. I think he included the other three items, I mentioned also.

General WHEELER. Yes, sir; I stated, Congressman Dondero, that it was economically justified on a money basis.

Mr. DONDERO. But he did say, however, those items used to justify the program rather drifted off into the realm of speculation.

General WHEELER. Yes, sir.

Mr. DONDERO. And he did not care to put his endorsement of approval on it and Congress promptly rejected it.

General WHEELER. Yes, sir.

Mr. DONDERO. It is the exception rather than the rule that Congress rejects any proposal of the Army Engineers. Isn't that true? General WHEELER. Yes, sir.

Mr. DONDERO. How many times has Congress ever refused to accept the recommendations of the Army Engineers?

General WHEELER. Very few. If I felt the same way as that Chief did, I would not have recommended it; it would have been a favorable report because I believe, acting on the opinion of the Chief of Engineers, Congress should say definitely that it is or is not.

Mr. PITTENGER. You are saying definitely now that it is economically justified?

General WHEELER. Yes, sir; I say it is, and I have considered all those past considerations, too, Congressman.

Mr. DONDERO. General Wheeler, is it the policy of the Army engineers to include among justified items those things which increase the land value? You do not do that, do you?

General WHEELER. No, sir; we do not directly do that.

Mr. DONDERO. Nor do you include recreational facilities?
General WHEELER. That is correct.

Mr. DONDERO. And as far as national safety is concerned, can you cite where national defense was ever included in an item to justify a measure for such an improvement?

General WHEELER. No, sir; we do not use those items in justifying projects.

Mr. DONDERO. And they have never been used or considered in any respect by the Board of Engineers in justifying the Tombigbee? Mr. RANKIN. Why not?

Mr. DONDERO. Well, would you say that the city of New York would be greatly enhanced by the Brooklyn Navy Yard, through your placing a value on the Brooklyn Navy Yard? In other words, I think the value of the Brooklyn Navy Yard would extend over the whole Nation and not a particular locality. Likewise, I do not think national defense is something to hang onto local values and I think the general is correct. In the 14 years that I have been on this committee no project has ever been presented to the committee where national defense was used as a justifying item to justify the economic side of the project.

General WHEELER. That is correct.

Mr. DONDERO. So that that was a mistake, as well as the other items that I have mentioned.

Now what has happened, General Wheeler since the prior report and since the last rejection by the House of Representatives of this proposal that makes you conclude that the river project is justifiable and should be included?

General WHEELER. There is no change in my mind since the last report, because I worked on the last report as resident member of the Rivers and Harbors Board and we recommended it as a justifiable project of tangible benefit, not basing it on the things you just referred to. We based our recommendation on its economic justification as a part of the entire system. The lock design has been changed to conform with the locks that are in use throughout the entire system. Mr. DONDERO. In other words boats or barges coming down the Cumberland or the Mississippi could use these locks as they are proposed?

General WHEELER. Yes, sir.

Mr. DONDERO. Whereas in the prior report you called for smaller locks; is that right?

General WHEELER. Yes, sir; we had smaller-sized locks, which involved a loss in towing. Now this report that we are submitting to you is based on present-day costs and there is a total amount for the entire system which is higher than when we submitted our report some years ago. You remember in 1939 for the smaller locks and the narrower bottom channel width also, as I remember, it called for about $66,000,000.

Mr. DONDERO. The total was about $75,000,000.

General WHEELER. Yes, sir.

Mr. DONDERO. This is about $125,000,000?

General WHEELER. Yes, sir.

Mr. DONDERO. So if we had adopted the prior report we might have made a mistake, in the light of what you are now saying.

General WHEELER. Well, in regard to costs you are opening up a very interesting subject, Congressman Dondero. I do think that the bids that we are receiving now for the projects we are opening look very hopeful to us. We are getting, for instance, bids from the low three or four bidders on the last big projects of around $12,000,000 to $15,000,000, and we are opening those bids and we are finding that they are withie 5 or 10 percent of each other, which means that they are getting firm bids from the steel industry, they are getting firm bids from the materials industry; which to my mind means that we can more safely justify our feeling that there has been an average increase of, say 25 percent in costs. That is about what we have been testifying to your committee.

Mr. PITTENGER. I want to make an observation here; that those two roll-call votes do not mean a thing except that Congress is not static. Congress may or may not have had sufficient information and the Members had particular reason for voting, so do not get scared concerning those votes. I voted for the project on those two occasions.

Mr. DONDERO. I made that statement to get it in the record.

Mr. RANKIN. General, isn't it a fact that one of the things which kept this project from going through was the question that was raised concerning the size of these locks. The barge people called attention

to the fact that those locks were so small they would not accommodate the barges used on the Mississippi and Ohio River, and that now that condition has been corrected in this report.

General WHEELER. Yes, sir.

Mr. RANKIN. Mr. Dondero raised the question about the former report. Now since the Pickwick Dam has been built, raising the water level 55 feet, you can go through there without any difficulty and connect up with the Tennessee River.

General WHEELER. Yes, sir.

Mr. DONDERO. My colleague from Minnesota avoids the discussion on the intangible items.

Mr. PITTENGER. I do not avoid anything.

Mr. DONDERO. That was the main ground for opposing and objecting to the project.

General WHEELER. May I make a comment about these intangible benefits? No one was more convinced than I, as a member of the Board of Engineers for Rivers and Harbors that recreation should not have any cash value assigned to it. I did not think it was fair for our Department to come before Congress and say recreation had a certain monetary value in trying to justify our projects. We did not include it; and yet when I go in the field and go to our reservoirs, that seems to be the thing that many of the people are most interested inin fishing and boating on these reservoirs-and Congress itself passed in the last Flood Control Act a provision that we would take carewould see that the people got the benefit of the recreational advantages. So I think that some day we are going to have to have some sort of a formula to evaluate those intangible benefits because they are more than intangible now; they are real benefits to the people of the community.

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Mr. DONDERO. With respect to the ratio of return for the investment, it stands 1.05 to 1?

General WHEELER. Yes, sir.

Mr. DONDERO. That is a ratio of about 5 percent?

General WHEELER. Yes, sir.

Mr. DONDERO. Is that about an average figure to justify such a project?

General WHEELER. We would not recommend it, Congressman Dondero, unless it had a 1 to 1 ratio. We give the actual annual cost that we have estimated, the annual benefits that we have estimated in figures, and in this particular project when it is computed it comes out at that ratio; and that is the conservative basis that we have submitted to you. The figures are there. We explained how we got them, and I believe that is the whole story. There is nothing we could add to it.

Mr. DONDERO. What is the largest item of commerce which you figured as one of the benefits? Petroleum products?

General WHEELER. Yes, sir; Petroleum is included, but it runs a gamut of practically every product. I do not know definitely that petroleum is the largest.

Mr. BOYKIN. I have some figures and I think petroleum is the largest.

Mr. PITTENGER. I do not see anything criminal in including intangible benefits. I heard the argument and I was a member of the committee and I voted to report it out. If they had not considered

intangible benefits along with a lot of other things, the little town of Detroit, Mich., would still be a fishing village, insofar as development is concerned-if they had not spent money on some of those lake harbors and on some of those other lake channels; and everybody knows that when you improve your waterways and let people circulate back and forth, why that naturally contributes to these things and they are called intangible values. So, as far as I am concerned, that does not worry me at all.

Mr. DONDERO. And Duluth would be lying around loose.

Colonel FERINGA. In tonnage the leading item is bauxite. In value it is sugar. On page 38 of the printed report you will find all the items listed and you will see that there is practically everything included.

Mr. DONDERO. I was referring to the figures found on page 19 of the report, which is given in dollars and cents, and wondering what items made up those figures.

Colonel FERINGA. Mr. Dondero, the figures I gave are in House Document 486, dated February 26, 1946.

Mr. PETERSON of Georgia. Are there any further questions?

Mr. BOYKIN. General Wheeler, our Chairman here and some of us spent about a month with General Kingman, and we made a study at Mobile. I do not remember the names of all the men there, but I recall that the General told me at Corpus Christi in the presence of Congressman Mansfield and several others that he thought this was the greatest project of all time anywhere in the world that he had ever worked on. General Reybold signed this report and I talked to him, and he said about the same thing about this great project. I also want to tell you that I was on the committee that two weeks ago voted to give a foreign country $600,000,000, and I am now referring to the Philippines. We gave them that money to be used for roads, docks, bridges, and all that sort of thing. Now, of course, that is a very small thing, but this is something which I think should have been done a hundred years ago. There is no way to properly describe this proposition. I think John Rankin has done it in his report and as he says, it is the greatest project, not only in America but anywhere on earth.

I have a copy here of the article which our colleague, John E. Rankin, put in the Congressional Record on April 4, 1946. This is one of the finest articles I ever read and I would suggest, Mr. Chairman, that it be inserted in the record at this point.

Mr. PETERSON of Georgia. Without objection the article by Mr. Rankin will be inserted in the record at the conclusion of General Wheeler's testimony.

Mr. DONDERO. It may be the greatest project on earth, with one exception: The St. Lawrence seaway.

Mr. BOYKIN. I am for the St. Lawrence seaway. I think charity should start right at home, right now. hope that I will convince you.

You have convinced me and I The chamber of commerce in Mobile

is in favor of it and sent me a telegram and said that they were in favor of it. I had told them that I would like to have their opinion and I

said: "I would just like to be with George Dondero on that great St. Lawrence seaway"; and along with Judge Mansfield and others I went up into Canada and I saw that waterway, and I studied it awful hard, long before I came to Congress. Now that project won't hurt the railroads, and neither will this project hurt the railroads. It will give them more freight than they ever had before, after you get this Tombigbee and the other projects going. I not only want the St. Lawrence but I certainly want the Tombigbee.

Mr. PETERSON of Georgia. Are there any further questions?

Mr. RANKIN. General, there is one further question I want to ask you. Do you know of any other project anywhere in the world where traffic can transfer from one major watershed to another with so much ease, so little risk, and so much savings in transportation costs and distances?'

General WHEELER. As I pointed out, Congressman Rankin, this waterway connects two great water systems, the Gulf port system, which is the Gulf intracoastal, and the great midcontinent system of our country, the Mississippi River system.

Mr. RANKIN. Now they have talked about a national defense system. Of course, I hope we never have another war. As far as I am concerned, I do not take any stock in somebody else dropping a bomb on us; but this atomic bomb is the greatest defense weapon on earth, and the project at Oak Ridge, Tenn., where it is produced, covers about 70 square miles. This will bring that project about 800 miles nearer the coast than it is today, would it not?

General WHEELER. Yes, sir; that is correct.

Mr. RANKIN. So that from the standpoint of national defense, I must say that I know of no project which has ever before had greater possibilities.

Mr. PETERSON of Georgia. General, to get the record clear, do you know of any opposition now to this proposal?

General WHEELER. I haven't received any personally, Mr. Chairman. Colonel Feringa tells me that the railroads appeared at the hearing that we held on the project.

Mr. PETERSON of Georgia. I gather from the discussion which has gone on so far this morning, in view of this revised project and the changes that have been made, that many of the objections which have been made and as a result of which it was not acceptable to certain Members of Congress and to certain of our American people, have been eliminated; and many of those who heretofore opposed the project are not opposing this new, revised project.

General WHEELER. I assume that is true, Mr. Chairman.

Mr. RANKIN. General, I am submitting a table here showing the saving on every barge load of 3,500 tons, using this project, as against the up-stream movement of existing traffic on the lower Mississippi River Basin on an average tow composed of eight barges (mixed sizes) carrying 3,500 tons of freight.

Mr. PETERSON of Georgia. It may be inserted in the record at this point.