the promissory note form that says, "You will agree to pay back to the Government any costs or expenses that you were put to." Dr. BOYD. It does not. Mr. REDDEN. Who prepared this form and said it was necessary to keep it? Dr. BOYD. You mean the original form? Mr. REDDEN. Whereby the interested party promises to pay the cost of the procedure. Dr. BOYD. It was written by the National Resources Board. Dr. BOYD. I don't know. That was a governmental procedure in order to provide the means by which a loan could be applied for. Mr. REDDEN. Yes, sir; but there is certainly no law requiring that an interested party, an applicant, would pay the cost of consideration of investigation of the application, is there? Dr. BOYD. I am sorry. I don't know enough about the legal aspects. Mr. REDDEN. If that is true, the miner is the only human being required to pay the Government. Dr. BOYD. This applies to all loans, for every purpose, not only mining, but any other kind of a loan, a loan for expansion of a machinetool plant, or any other kind of a loan. Mr. REDDEN. Did anyone ever pay the Government anything for such a procedure? Dr. BOYD. I don't know. Mr. REDDEN. You never heard of it? Dr. BOYD. I never heard of it. RESIGNATION OF FRED SEARLS, JR., FROM OFFICE OF DEFENSE MOBILIZATION ANNOUNCED Mr. ENGLE. I have some very competent information for Dr. Boyd, even though he may not admit it here. It is a letter from Charles E. Wilson, directed to the chairman of our committee. I will read one sentence of it. It is dated April 3, 1951, and it is in response to a request by the chairman for Mr. Searls' presence here to be interrogated, shall we say, about some of these things. It says: Mr. Searls has given up his position as assistant to the Director for Materials, and will not be in Washington until April 6— PROCESSING OF APPLICATIONS IN DMA DISCUSSED I don't want to take all the time here, and I am going to try to get through this very briefly, but the procedure is set up so that the application first goes to Mr. Strobel, Executive Secretary of DMA. Dr. BOYD. Yes, sir. Mr. ENGLE. And he puts a file number on it and away it goes through your lay-out? Dr. BOYD. That is so we can keep track of it. Mr. ENGLE. How many numbers do you have down there? Mr. ENGLE. Nine hundred and twenty-nine. I see the miners are at work. The application goes to your plant, and then you send it to the proper production committee? Dr. BOYD. I beg your pardon. Mr. Strobel is in my plant. He is executive secretary of DMA, and it is his responsibility to keep track of these pieces of paper so that when anyone requires them he will know where they are and how we are getting along. That is very necessary when people call up. Mr. ENGLE. Where does he send it? Dr. BOYD. Directly to the commodity branch chief of the particular metal involved. Mr. ENGLE. If the metal is chrome, it goes to Mr. Bradley? Dr. BOYD. That is correct. Mr. ENGLE. And Mr. Bradley looks over the application? Mr. ENGLE. Now, if it involves an application for an over-themarket contract, what does Mr. Bradley do with it? Dr. BOYD. He determines whether the program that he has for chromium or tungsten has been approved, involving the production of chrome, which would require an over-the-market price. In the case of chrome it will require it. He would then find out the information necessary to recommend a contract for chrome above the market price. Mr. ENGLE. But you have approved no policy as yet with reference to over-the-market contracts for any material; isn't that right? Dr. BOYD. That is correct. We have recommended some, but notMr. ENGLE. In other words, Mr. Bradley gets the application because there is no policy on the subject matter. That is about as far as goes, isn't it? it Dr. BOYD. It would be if there were no policy developed. If you will notice in the attachment here, my instructions to the staff are that as soon as we have developed a program we will go ahead on the assumption that that is the policy until it has been disapproved at a high level, in order to save time in that particular action. Mr. ENGLE. And if it involves an exploration and development loan, since there is no policy on that he has to stack it very neatly on a pile, doesn't he? Dr. BOYD. No, sir; he does not. We are going ahead with all applications that involve exploration loans, and that require a field study. People are sent to the field immediately. Some are waiting for the final form to be sent out. They are actually passing on them right now. Mr. ENGLE. In other words, what Mr. Bradley would say is: "This looks like a reasonable application, if we ever have a policy"-then he proceeds to send it out to the field; is that right? Dr. BOYD. If it needs a field check. Some don't need a field check. Mr. ENGLE. When it goes to the field, where does it go, to the regional office? Dr. BOYD. The regional team of the Bureau of Mines, the executive member of the team. One man. Mr. ENGLE. One man. What became of the three men, one each from the USGS, the Bureau of Mines, and Defense Minerals? Dr. BOYD. We have a mine man assisting Mr. Bradley, giving him technical information, and all the help he needs, but Mr. Bradley has the only responsibility. It is not a committee operation, it is an individual operation today. Mr. Bradley does it, himself. Mr. ENGLE. And the field team goes out? Dr. BOYD. That is correct. Mr. ENGLE. I understand in Denver they have all kinds of applications piled up and they don't have enough engineers to service them. Dr. BOYD. I am afraid that is true. They have piled up in Denver. Mr. ENGLE. You simply can't get the engineers for that kind of job? Dr. BOYD. That is right. Mr. ENGLE. They are not around? Mr. ENGLE. And you never will? Dr. BOYD. We will get some. Mr. ENGLE. To write a program like that, you are going to be balledup forevermore. But after it goes to the field it goes to the regional office, and back through Mr. Bradley? Dr. BOYD. That is right. It is an automatic operation. Mr. ENGLE. I am not criticizing Mr. Bradley. I just want to find out the procedure. Dr. BOYD. We are trying to do it as direct as possible. Mr. ENGLE. Doesn't the fellow in the regional office look over the work done by the field man? Dr. BOYD. He would check his report, of course, mainly to speed the thing up, to see that he wasn't sending in an improper report which couldn't be used. Mr. ENGLE. He would still have to look at it, and his name has to appear on it, and he has to initial it? Dr. BOYD. Yes. Mr. ENGLE. Did you ever figure up how many names you have to get on one of these applications? Would it run 1,500? I saw an article in the New York Times that said one contract down here required 1,500 signatures. Dr. BOYD. No; I am quite sure it wouldn't happen. Mr. ENGLE. Twenty-eight is a lot, isn't it? Dr. BOYD. I can't conceive of there being any more than six in the DMA. Mr. ENGLE. We have already got Mr. Strobel. Dr. BOYD. He doesn't sign anything. He just transmits them. Mr. ENGLE. He fusses with it, and puts a number on it, and creates a file. Then he sends it to the proper commodity committee, doesn't he? Dr. BOYD. That is right. No; he sends it to the branch chief of the Supply Division, not a commodity committee. It doesn't go to the committee at all. Mr. ENGLE. That is No. 2. Then it goes to Mr. Bradley, who is chrome and tungsten? Dr. BOYD. Yes. Mr. ENGLE. Then the regional office. that is four, and then to the field team, five? Dr. BOYD. It goes to the field team direct, not to the regional director. Mr. ENGLE. You cut him out. It comes back through the regional office? Dr. BOYD. No, sir; only through the team in the field. It doesn't go back to any regional office of the Bureau of Mines. Mr. ENGLE. I thought you said they looked it over. Dr. BOYD. I am sorry. I thought you meant the director of the field team. That is what I was referring to. Mr. ENGLE. If he is a different fellow. All right. I think you have six or seven steps figured up already. Dr. BOYD. Two. Mr. ENGLE. After you get all through, when it comes back and if it relates to over-the-market price contracts, development, or exploration, since there is no policy with respect to these items. Mr. Bradley will have to sit on it, won't he? Dr. BOYD. Yes; he would up to that point; however, we have a program approved for exploration. We are processing paper under that now. The only thing we have not got is the money to finally pay out the contract. Mr. ENGLE. You have what it takes to make it work? Dr. BOYD. Yes, sir; we are working on it right now. Mr. ENGLE. But if it happens to involve a straight production contract at market price, then it goes over to DPA; is that right? Dr. BOYD. That is right. Before that we have to negotiate the contract with the company or the individual who required negotiation. In other words, we would work with the General Services Administration in seeing that their contract is a public contract. Mr. ENGLE. When is that, after it comes back from Mr. Bradley? Dr. BOYD. Yes, after he has approved it. Mr. ENGLE. After you have done that, when does it get up in the palace guard, just below the Secretary of Interior? Dr. BOYD. Those contracts don't go to the Secretary's office. Dr. BOYD. That is right. Mr. ENGLE. Like this exploration and development proposition? Dr. BOYD. That is correct. Mr. ENGLE. And don't the forms go to him, also? Dr. BOYD. Not necessarily. Mr. ENGLE. I understand a new brochure was set up, explaining and advocating by your agency the exploration and development program you say is now over at the Bureau of the Budget, and sent up to the palace guard in the Secretary's office and it got lost and they couldn't find it for 2 weeks. Do you know anything about that? Dr. BOYD. No: I don't. Sometimes it takes a little while. Mr. ENGLE. We will find out if it was lost, or just misplaced. In any event, when the negotiated contract goes to DPA, Harrison's outfit, what happens to it? Dr. BOYD. They certify it to General Services Administration for implementing the contract. Mr. ENGLE. What if they don't like it? They can kick it all the way down, can't they? Dr. BOYD. They could. Mr. ENGLE. In other words, they boot it all the way down, and you have to start over, maybe send it out to the field team? Dr. BOYD. No, not the field team. We would have to renegotiate it. Mr. ENGLE. I am interested in the figures you gave in your statement; at one time the Munitions Board was before this subcommittee and we asked them how much material had been acquired for the stockpile, and they gave me the figure. It developed that their figures down into three categories, as follows: On hand, contracted for, and earmarked. When I asked them for a breakdown on the distinction. between on hand, contracted for, and earmarked, they told me that that was classified information that they could give me only in executive session. I notice here that you claim that you have processed-I am reading from page 2 at the bottom of your statement-processed 21 major procurement contracts. Dr. BOYD. Yes. Mr. ENGLE. The term "processed" doesn't mean that you have a contract? Dr. BOYD. No, sir; it does not. Mr. ENGLE. In other words, what you were saying in this statement is that you have done your job on that many? Dr. BOYD. Yes, sir. Mr. ENGLE. But that doesn't clear them all over the hurdles that they face on the other side of the building? Dr. Born. That is correct. Mr. ENGLE. And then these figures that you have set up are figures based upon the assumption that all the processed contracts will be put into execution; isn't that right? Dr. BOYD. Yes, sir. I have no reason to assume that they will not be approved. There is no reason to. Mr. ENGLE. Wait a minute. I am not so sure about that. What you have done at the top of page 3 of your statement, Dr. Boyd, is to indicate the anticipated results of contracts not yet made, and which have only been processed by your agency; isn't that right? Dr. BOYD. Yes. Mr. ENGLE. In other words, so far as these figures are concerned, they are fully unrealistic, are they not? They have not any relationship to the present facts at all; isn't that right? Dr. BOYD. I can't answer that just now. Mr. ENGLE. Maybe that is putting it a little too strong, but they don't represent firm contracts of this material, much less material on hand. Dr. BOYD. Not all of them. Some of them do, but most of them don't; that is correct. Mr. ENGLE. We have a statement here from the General Services Administration which indicates that you have about four contracts out. Is that right? Would you say that this compilation sent up by General Services is correct? (The statement referred to is as follows:) Hon. JOHN R. MURDOCK, GENERAL SERVICES ADMINISTRATION, House of Representatives, Washington 25, D. C. DEAR MR. MURDOCK: Receipt is acknowledged of your request of March 30, 1951, for information concerning contracts let as a result of certifications issued by the Defense Production Administrator or the National Security Resources Board based on recommendations of the Secretary of the Interior or the Administrator of Defense Minerals Administration, for the purpose of encouraging the exploration, development, and mining of strategic and critical materials pursuant to the Defense Production Act of 1950. There is enclosed a tabulation giving the information requested. |