With respect now to the resolution before the committee, this resolution in effect suspends selection boards until July 1, 1938. It does not prohibit the promotion of officers heretofore selected, nor the retirement of officers who have not been selected prior to reaching the service-in-grade limits. The purpose of the resolution, as I understand it, is to hold up the operation of the selection system until major improvements can be devised and applied.

This suspension of selection will, however, have some distressing effects. In the commanders' grade, under the service-in-grade provision of law, which would remain in effect, those members of the class of 1910 who have not been selected by June 30, 1938, must retire on that date. Only four members of this class have been selected to date; none has been "passed over", i. e., failed of selection while a junior on the list has been chosen. The entire class (44), save the four selected, must thus retire without any opportunity for selection and promotion. In the lieutenants' and lieutenants' (jr. gr.) grades, the suspension of selections will cause the designation of entire blocks of officers, reaching the 14-year and 7-year point, as additional numbers. They will more than offset the gain in regular numbers from the graduating class of 1938. This decrease in regular numbers, and the normal attrition loss during the year, will result in a decreased distribution-base and a decreased allowance of officers in each of the upper grades. No demotions will occur, but no promotions can be made until the numbers in those grades are reduced by attrition to the newly allowed figures. This delay in promotion will undesirably increase the age of entrants into each grade.

As the committee is aware, the Navy Department has for years been working on this problem of selection and promotion, and the system as now developed is the result of many minds and much effort. Just recently the general board has made an exhaustive study of the promotion system, and all bureaus of the Navy Department have studied this report and offered such suggestions as they desired. The Bureau of Navigation has acted as a clearing house for these suggestions, and, on the general board's report as a basis and with these and its own concepts, has developed measures which we believe will, in large part, overcome the disadvantages of the present system and will at any rate represent a further step in the development of the ultimate perfect system-which we admit is difficult to attain and perhaps at the moment still over the horizon.

(Here Admiral Andrews read excerpts as follows from the Bureau of Navigation letter of 10 May 1937 to all ships and stations of the Navy.)

"With especial application to remedying these difficulties, but also in order to improve and perfect other phases of the promotion system, the following proposals, in modification of the existing system, are now under consideration in the Department:

"(a) Increase of the allowed percentage, of the total number of officers, of lieutenant commanders from 15 to 18, to reduce the loss of officers eliminated from the active list through nonselection from the grade of lieutenant. Corresponding reduction of the percentage allowed the combined grades of ensign and lieutenant (j. g.) from

"(b) Officers twice failing of selection, which is to be defined as having been actually "passed over", to pass from the active list to a "Transferred-regulars list". Officers who have not twice failed of selection on completion of present service-in-grade limits, to be continued on the active list for not longer than 1 more year.

"(c) Officers passing from the active list to the transferred-regulars list to receive pay on transfer at the rates now fixed for officers retired after nonselection. These officers to be subject to employment by the Navy or other Departments of the Government; while so employed to receive active-duty pay and allowances, with the same longevity increases as provided for officers of the active list.

"(d) Officers of this transferred-regulars list to be placed upon the retired list at the following ages: Captains, 60; commanders, 55; lieutenant commanders, 50; lieutenants, 45; and lieutenants (j. g.), 40. Their retired pay to be computed on their total years of active service (both on active list and on transferred-regulars list) and upon the rate of pay received at the date of their retirement.

"(e) Officers developing minor physical defects, which prevent their continuance on the active list but do not disqualify them for performing certain duties, to be transferred to the transferred-regulars list. "(f) Retired officers to be eligible for employment in other departments of the Government.

"(g) Removal of present limitations on the numbers, now somewhat less than those resulting from the allowed percentages in grade, in the grades of rear admiral, captain, and commander.

"(h) Annual selection of captains for the grade of rear admiral of one-eighth of the allowed number of officers in the latter grade.

"(i) With respect to the staff corps, continuation of the present (equalization) method of promotion, with the following modifications:

(1) Staff corps selection boards to be composed of not less than six members detailed from officers on active duty; officers of the line of corresponding rank to be used to complete the boards when sufficient staff corps officers are not available.

"(2) Captains in the Staff Corps to be subject to selection, unlimited as to numbers selected, for an "eligible list" when their running mates of the line are selected for promotion to the grade of rear admiral. Staff Corps captains not selected for the eligible list to be retired after two failures of such selection. Subsequent selections to fill vacancies in the flag rank in the Staff Corps to be made from this eligible list only.

"The general purpose of these proposals is self-evident. The transferred regulars list is created as a means of continuing the employment in the Navy and in other departments of the Government of deserving nonselected officers, excepting those who desire to engage at once in civilian pursuits; thereby availing the Government of the benefit of their services and at the same time increasing their economic security. "The retirement ages of officers of the transferred regulars list are set at limits commensurate with the duties which they might appropriately discharge in the Navy. The discontinuance of their employment in other departments on passage to the retired list would not be necessary, since retired officers as well as those of the transferred regulars list are to be eligible for employment in such departments.

"The provision for an opportunity, insofar as practicable without unduly delaying promotion, of two chances of selection for each officer

before he is transferred from the active list because of nonselection, will provide a review by a second selection board of the action of the first. On the other hand, the transfer of officers to the transferred regulars list after a second failure of selection will to some extent expedite promotion.

"The removal of the restriction on the numbers in the higher grades will somewhat increase the flow of promotion.

"The Navy Department is striving to improve the selection system now existing wherever it may be possible to do so. The Chief of Bureau desires again to emphasize that the Bureau welcomes any and every suggestion from officers of the Navy as to adverse or inequitable effects of the existing laws regarding promotion, and as to remedial measures which should be applied. In submitting any comments on this subject, officers may address their communications direct to the Bureau of Navigation, without the delay occasioned by transmission through official channels. Such letters will not be filed with the records of the officers concerned."

Now, with your permission, Mr. Chairman, and in order to keep the record straight, I should like to reply to several points raised by the distinguished Congressmen who have appeared before the committee.

SUGGESTIONS FROM OFFICERS

Throughout the long years of the development of the selection system, service interest has been keen and many letters have been sent in and suggestions made by officers of the Navy from time to time. These suggestions have been used in preparing the successive recommendations made to Congress by the Department for improvement of this system.

In early 1936, when the general board began its studies leading to the recently submitted report, every officer of the Navy was informed that the general board would welcome suggestions. Over 130 letters were received by the general board, offering concrete suggestions for improvement, evidencing both wide-spread interest and freedom of response.

At no time has any refusal been made of the right of officers to express themselves on this subject. On the contrary, I have urged officers to do so. Within the past month I have received many letters from officers on this subject and I have sent them each an appreciative acknowledgement.

Since I have been Chief of the Bureau I do not know of one single instance where any officer has been criticized for expressing his opinion on the subject of selection, and I can assure this committee that such action on the part of any officer would in no way militate against him nor would it be made a matter of record. On several occasions when officers have written papers on selection that appeared to merit more detailed consideration, the Bureau of Navigation itself has assisted them in the preparation of data.

With respect to the 1934 hearings, our records show that six officers. testified-three in favor of, and three against-the promotion bill then under consideration and subsequently passed. All six were selected afterward. This does not warrant any general feeling of apprehension

During the hearings of the Appropriations Committee this question of selection was discussed at some length. During this discussion, Mr. Ditter asked if I would approve a secret poll of all officers on the subject of selection. My answer to that was that I did not approve such a method, believing and feeling that every officer is free to express his opinion and give any constructive criticism, or otherwise, which he may hold regarding this system. I must take exception to Mr. Ditter's statement that at that time I stated that "I saw no need of giving the underofficer group the chance to express themselves." On the contrary, I did state that I had welcomed comment by every officer of the Navy.

PUBLICATION OF GENERAL BOARD'S REPORT

The Secretary of the Navy has considered that the general board report should be held confidential following the precedent of all other reports of the general board.

While this report has not been made public any Member of the Congress who has requested this report has been supplied with a copy, and I might say to the committee that I am sure the secretary will be very glad to furnish each member of this committee a copy of this report.

COMPARATIVE COST OF SYSTEMS

The actual cost of the officer list under the present system is no greater, per active officer maintained, than would be the cost under a seniority system, even with its retarded promotion. The active list costs less due to the lower average age and total service of the active officers in each grade. There are more retirements numerically and the retired list is greater in number, but, due to the relatively low average retired pay the increase in cost of the retired list is approximately equal to the savings made in the active list. With a regular unretarded promotion the seniority system would cost more than the present system. In fact, the cost of an uninterrupted service career of 42 years with promotions every 7 years is greater than the total of the retired pay of an officer retired for nonselection plus the pay of his replacement officer. This is true no matter in what grade the nonselection retirement takes place; the earlier it occurs the greater the saving.

When considering costs of the sytems, and particularly of the retired list, the emergency value of the retired list under the present system should be appreciated. Under a seniority system the retired list would consist entirely of physically disabled officers, officers over 64 years of age, and of officers retired after 30 or more years' service.

CAREER EXPECTATIONS

The point has been made that officers on graduation from the Naval Academy are no longer assured of a complete service career. Although this would be desirable from the point of view of the individual officer, it is doubtful whether it could be expected in any walk of life. The Naval Academy graduate is assured of an opportunity to compete on equal grounds with his fellows toward the achievement of a full and active naval career. This assurance of an opportunity to compete is, I believe, a sufficient stimulus to continue to bring us the highest quality of young American manhood.

FINAL SEPARATION AT AN EARLIER STAGE IN THE CAREER

Even assuming that a full and complete judgment of an officer's prospective abilities might be made shortly after graduation, the separation at that time of the less promising officers would leave the Navy insufficiently manned in the lower grades. As I have already mentioned, there must be a wide foundation of junior officers filling the lower officer requirements throughout the Navy, in order that the efficiency of the battle organization of the Fleet may be maintained. This is the primary difficulty-that we need so many officers in the lower grades but we cannot use them all in the upper grades. Separation of officers soon after graduation might solve the problem of reducing the losses at later steps in the career, but it would at once curtail the necessary supply of officers in the grades of lieutenant and lieutenant (jr. gr.).

REDUCTION OF NAVAL ACADEMY CLASSES

Just as separation of officers soon after graduation would result in an inadequate number in the lower grades to fulfill the manifold needs of the Navy, so a major reduction in the graduating classes from the Naval Academy would likewise fail to provide enough junior officers.

The recommendation in 1935 of five appointments was made to build up the Navy the more quickly to its authorized strength. In view of the promotion hump that would subsequently be caused, however, the Department recommended a four-appointment basis, though at the cost of delay in building up the total number of officers.

SELECTION OUT OF UNFITTED

The suggestion has been made that selection be continued, but that it be confined to a selection out of those not fitted for promotion, all the remainder being promoted. With the high caliber of officers in the Navy it is to be assumed that only about 5 percent would at each step in promotion be found not fit for promotion. With promotion at 7year intervals, and allowing for natural attrition and for a 5 percent elimination at each step in promotion, we would have 750 captains and 563 admirals, surely an unwieldy and expensive group of ranking officers. At the same time, within a given total number of officers, we would be badly short of junior officers.

NARROWING BASE AND WIDENING TOP

This last proposal shows an extreme case of narrowing the base and broadening the top. A certain amount of adjustment in this direction can well be done, however. This I have noted in the item to increase the percentage of lieutenant commanders from 15 to 18, with a corresponding decrease of the lieutenants (jr. gr.) and ensigns from 42 to 39, thus narrowing the base and broadening the middle. Similarly I have proposed broadening the top by removing the restrictions, below the allowed percentage distribution, on the peacetime allowed numbers of rear admirals, captains, and commanders. These measures will reduce