For instance, James T. Duffy, Jr., president of the Read Machinery Co., stated in his affidavit submitted in answer to the questions of your committee: 66* * * for many years we had a Washington representative who handled our contracts with the various governmental agencies and during that period we were engaged in the manufacture of equipment for the Navy, Quartermasters Department, Maritime Commission, and other governmental agencies such as the Veterans' Administration. The last representative was not satisfactory and Mr. T. F. Freed, vice president and sales manager, and I later took over the handling of these accounts, approximately a year before the employment of Mr. Orr. This required 2 or 3 days a week which was more time than I could spare from the supervision of the actual production, and I was looking for a man to handle this work in Washington for our company * * * ""

It is only through the retention of the reputable manufacturer's agent that the small manufacturer can receive adequate representation in this city and such representation, I am sure you will agree, is most necessary to overcome at least to a minor extent the tremendous advantage the big manufacturer has over him.

Those firms I now represent came to me upon the recommendation of friends or other satisfied clients. I have charged no excessive fees. In most cases they have been 1, 12, or 2 percent, with an average of 1.46 percent. I feel that such fees are both reasonable and equitable. I am not getting rich quick and I have every reason to believe that I never will be rich, at least as the result of the business in which I am now engaged. Considering the services rendered by me, my commissions were small. Certainly, any delay in production would have been far more costly. In most, if not all, of the instances where I was successful in assisting my companies to obtain contracts or subcontracts, the work would not have been undertaken at all but for my efforts, or there would have been serious delays. It should also be emphasized that I performed this work at a time when whole areas of industry were unconverted to war needs.

May I state that I engaged in this type of work because I felt that my training in the Navy ideally suited me for it. As the result of this naval and other governmental experience in Washington and elsewhere, I learned how to cut cornersto avoid to some extent the maze of red tape one finds himself confronted with in the Government agencies. I also thought that assisting the small manufacturer to find his place in our war effort, without highjacking him, was a distinct service to my country. I felt that he should be helped and that big business should not be permitted to eliminate him entirely from the picture.

May I emphasize that I have no influence to sell.

I believe myself to be a competent engineer and that my previous background and more recent experience with the Army and Navy enable me to be of value not only to the companies I represent but also to the Government.

I agree that there have been flagrant abuses in the commissions extracted by a few big-time manufacturers' agents, some of which have already been brought out into the sunlight by congressional committees. I do not feel, however, that I have been guilty of such practice. On the contrary, I honestly believe that I have done a legitimate and desirable job-both from the standpoint of the Government and my clients.

And in conclusion please permit me to repeat, Mr. Chairman and gentlemen of this committee: If the Congress legislates against the honest manufacturers' agent God help little business.

The CHAIRMAN. The committee will take a recess until 10 o'clock tomorrow.

(Whereupon, at 5:10 p. m., the committee recessed until 10 a. m., Friday, July 17, 1942.)

EXHIBIT No. 484.-Shirley, Olcott & Nichols receipts—1942

EXHIBIT No. 485

HISTORICAL RECORDS SHIRLEY, OLCOTT & NICHOLS

Mr. A. P. Shirley, senior member of this firm, has spent his entire career in the engineering development and sales of machinery tools and shop equipment. Somewhat prior to the first World War, he was general sales manager and manager of export sales for the Kelly Axe & Tool Co. and the American Axe & Tool Co. During this period Mr. Shirley traveled in practically every country of the world in connection with the establishment and administration of branch houses and dealers handling the products of these companies.

At the beginning of World War No. 1 Mr. Shirley was drafted into the service of the Army by high officials who were acquanited with his years of experience, and he was asked to help organize the Motor Transport Corps of the Army and select all of the machinery that was used for repair work. He arranged for induction into the service of expert mechanics from the various automobile companies, and when a regiment of these expert mechanics was formed, he was given a commission as a major and sent with them to France to establish a motor repair base at Verneuille, France. After the end of the war, Mr. Shirley returned to Washington and resigned from the service. After the armistice, Mr. Shirley traveled for a period of 10 or 12 years with his old business associates building up the export business that they had enjoyed previous to the war. Then, becoming tired of traveling in foreign countries, Mr. Shirley resigned his position with the Kelly Axe & Tool Co. and temporarily retired from business. Mr. Shirley settled in Washington and intended to take a long rest, but several friends of his in industry, whom he had known for many years, suggested that he open up an office in Washington and become their Washington representative. This was

in 1929.

Mr. Shirley took on a few accounts, and as other friends of his in industry heard what he was doing, they asked him to take on their accounts also, and the business grew to such proportions that by 1934 Mr. Shirley felt that he must have some assistance of engineering caliber to help carry the load, and he prevailed upon Mr. F. B. Olcott to join him as a partner.

Mr. Olcott has spent his entire career along metallurgical and allied lines, having entered the Bethlehem Steel Works immediately upon leaving school. Mr. Olcott held the position with the Navy Department as an inspector of engineering materials in 1917 in the Philadelphia district. After the armistice in 1919, Mr. Olcott was transferred to the Bureau of Construction and Repair (now Bureau of Ships) in the Navy Department at Washington, D. C., as a materials engineer in the Metals Section. Mr. Olcott advanced to the position of senior materials engineer of the Bureau, the highest civilian rating in that classification. In 1934, having held for some years the highest grade established for a civilian, materials engineer, and being unable to advance further, owing to the existing civil-service standards, Mr. Olcott decided to find another field for his professional development. Having known Mr. Shirley for many years and being desirous of remaining in Washington on account of property and family interests, Mr. Olcott was glad to accept Mr. Shirley's invitation to join him in a line of engineering work where the technical work was so similar to the work he had been doing for the Government, and where he could still maintain to a certain degree his contacts on engineering societies and technical committees. Shortly after resigning from the Navy, Mr. Olcott attended a meeting of the American Society for Testing Metals, of which he has been a member for many years and at which time he held the chairmanship of two of their technical subcommittees. In that meeting he mentioned to several of his friends in industry his future plans, and as a result the firm of Shirley & Olcott were offered and accepted several accounts, all of whom are still active on their books.

In 1937 the activities of our firm had increased to such a point, particularly in connection with machinery and machine-tool accounts that it was felt that additional assistance of an engineering nature should be obtained. Mr. F. C. Nichols, a personal friend of many years' standing was prevailed upon to join the firm as a third partner.

Mr. Nichols has spent his entire career in connection with the operation, use design, and engineering of machine and hand tools and shop equipment. In 1923 Mr. Nichols was transferred from the Navy Yard, Norfolk, to the Navy Department at Washington as a materials engineer to handle the technical work in connection with such products. Mr. Nichols was Chairman of the Federal Specifications Board Committee on hand tools and was a member of the Navy Depart