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lowance if a diplomatic secretary or consular officer should be appointed by the President an ambassador or minister. The affect of not making such a provision will be that a consular officer of the first grade, or counselor of embassy without means who is offered by the President an appointment to a legation or to an embassy would have to refuse that appointment because under the present law, as I read it, he loses the right to a retirement allowance.

Mr. ROGERS of Massachusetts. Take the case of Mr. Skinner, who has been in the Consular Service 30 years, and who now receives à salary of $12,000 as consul general at London. He might receive an appointment as minister, presumably at a less salary of $10,000. If he took that appointment and what would be regarded as a promotion in spite of the reduced salary, he would thereby under the terms of the bill be cut off from the benefit of the retirement allowance when he reaches the proper age. Therefore, in justice to himself he would presumably have to decline the promotion.

Mr. Lay. Yes, and we would lose a good man.

Mr. O'CONNELL. No matter how long he has been in the service that rule would obtain just the same?

Mr. Lay. Yes. Mr. ROGERS of Massachusetts. Mr. Lay handed me a letter from Mr. Skinner that seems to be very pertinent on this point. It is dated from London January 1 and reads in part as follows:

“I would like to point out to all concerned that section 16 as it now stands tends to perpetuate one of the greatest evils which the bill as a whole is intended to overcome. Over and over again we hear of complaints that only the rich can enter the Diplomatic Service, and over and over again it has been urged that it should be possible for men of ability, whatever their personal means are, to accept these posts. What better means could be devised of preventing, possibly, the poor man from accepting appointment as minister or ambassador than that provision of section 16 which limits the retirement allowance specifically to foreign service officers?”

I should like to say on that point that we are printing in the hearings of Monday the proposition which I am offering by way of a substitute to section 16 of the bill. H. R. 17 as it is before the committee now is advisedly the exact bill which was passed by the House a year ago. There are some respects in which I thought the committee might modify it in executive session, and one of the respects in which I hope to see modification is in accepting a substitute for section 16.

Mr. Lay. In this connection I might say that when I was retiring from the Consular Service somebody suggested to me-a prominent official of the Government—that the President might see fit to appoint me as minister, but I could not consider such an appointment without some provision for old age. I felt I would be jumping out of the frying pan into the fire. I believe that the Consular Service can be made as attractive as big business to our young men if provision is made for a retirement allowance.

Mr. CONNALLY. You spoke about big business. Everybody can not be in big business. Only a few of the best minds of the country get into big business and get the rewards of big business.

Mr. Lay. I am speaking of the young men of high type, the young intelligent man whom we want in the foreign service, the active, broad-visioned fellow and hustler whom the business men want abroad.

Mr. CONNALLY. Certainly.

Mr. Lay. That same type of man could get into big business. He has not the money and can not afford to make a sacrifice in the foreign service.

Mr. CONNALLY. Is it not a fact that the majority of doctors and other good professional men are failures financially? Is not that generally so of the average lawyer, say, in New York?

Mr. Lay. We do not want failures in the service.

Mr. CONNALLY. But you are not going to get everybody who is a success in the Diplomatic Service. All of them are not going to be stars because then the rest of the country will be in bad shape if we are going to draw all of them. Big business will blow up and all the professions, and the rest of the Government service robbed, if you are going to get all of the choicest material.

Mr. ROGERS of Massachusetts. I think we can afford to send out 120 good ones.

Mr. CONNALLY. They have already got as good service as there is in the world at the present time. To tell you the truth about it, I am in sympathy with a great deal in this subject, but it does not seem to me that all this argument that is put forth about going to have the best fellows in the world in there and that we have got to have this and that is sound. Your percentage will run like everybody else's percentage. You will have some excellent and some who are failures and some average folks like the rest of us. So I do not think it is a fair comparison to be always comparing these salaries with what a young man could get as the head of a steel corporation or as the head of a Henry Ford automobile factory or a Standard Oil chief executive, because they are not going to be that, all of them. If every man in the department should resign tomorrow, I do not fear but that the normal commercial organization would still function without getting them all at the head of the corporations. I am talking a little plain, but it has been cumulative with me and I have got to blow off steam. It is not fair to the rest of the country to be comparing the Diplomatic Service, that all these young men who come into it can go into big business.

I know some young men in the Diplomatic and Consular Service from my State. The State Department supplied me with a list of how many of my State will be benefited if I voted for this bill and how many. I would please. I know most of these young men, but I have no idea that instead of going into the Diplomatic and Consular Service if they had gone into law they would be down in Texas hustling trying to meet their board bills, not because they are not excellent, but because anybody who goes into a learned career has got to sacrifice for a long time before he gets his head above water. I know that for years I did not make ends meet but I had to go through that in order to succeed at all, and I think it is a wrong idea that these young men have all got to start in at large salaries and just from the beginning be tremendous successes, because they are not going to do it, and we can not pay them when they start in salaries comparable to what they would get in some big business enterprise after years of study and toil.

Mr. COLE. Is it not true that those salaries, perhaps, are not large? Mr. CONNALLY. If you make a proper percentage, no.

I am talking more about arguments before this committee than I am about the bill. Not every one can be a chief and second mate. We have got to have a few seamen around.

Mr. Lay. I do not think that this bill is going to make the service perfect by any means, but I believe it will increase the number of applications of high-grade men, the class of men that the service needs for examination. I think that a better class will apply for examination, and you will improve the service thereby, and the service needs improvement.

Mr. COOPER. It is true, is it not, that our consular and diplomatic officers do not engage in private business in these countries when they resign?

Mr. Lay. They are not allowed or permitted to invest in the securities of the countries to which they are accredited.

Mr. Cooper. That being so, a young man going to one of these foreign countries is limited strictly to his salary, and he is in an entirely different position from my good friend, Mr. Connally, when he started out, an enterprising, hustling young man, who could hardly make his income meet his expenses. He had every opportunity in the world to engage in as many private businesses as he wished, and in connection with law practice had a right to hustle in every direction, and he has succeeded and saved his money, but a young man in a foreign country is limited strictly to his salary and nothing else.

Mr. LAY. That is absolutely true.

Mr. COOPER. So there is really no analogy between the two opportunities.

Mr. COLE. Is it true that you engaged in growing pecans while a struggling lawyer?


Mr. MOORES. A consul in Italy told me he was absolutely cut off from what he knew most of, stocks and bonds, cut off by law from investing in securities in Italy and by distance from investing in stocks and bonds in this country.

Mr. CONNALLY. That is true, and I would not object to that; but what I am objecting to is the statements made that these young men do not come into the diplomatic and consular service because they can become the heads of a steel corporation, or the National City Bank, in New York, or some other big business enterprise that is anxious to pay them high salaries at the start. One or two out of a thousand might do it.

Mr. O'CONNELL. We have an illustration in the present witness, who was taken by a business concern which gave him a salary several times as much as his Government salary after he had obtained his training and education.

Mr. COLE. In case a young man does not make good you can get rid of him.

Mr. Lay. Surely. Then, too, under the present régime we have a lot of old men in the service no longer competent.

Mr. COLE. It is not the purpose of this bill to continue a man in this foreign service unless he makes good.

Mr. Lay. Certainly not.

Mr. MOORES. You do not have to have a civil-service trial to get rid of them, but just write to them, “ Your resignation is accepted." When a man is inefficient he gets a letter from the Secretary of State to that effect. Is that right?

Mr. Lay. Yes. The tenure of office is at the pleasure of the President.

Mr. LINTHICUM. Did you mention your present occupation?
Mr. Lay. I am in a firm of international bankers-Speyer & Co.

Mr. COOPER. I will say this also, in reference to the suggestion of my frienį from New York, that the witness now on the stand secured an education in the Government service that enabled him to get this splendid salary which he now receives, but the witness has himself said that his life work had been in the employ of this Government in foreign countries and that he would not have retired from the Government service had it not been for the threatening poverty of old age, alluded to by Bobbie Burns in the lines: Age and want, O, ill-matched, ill-matched pair."

So the Government eventually lost a very splendid servant simply because there was not this retirement provision. This man who now gets this munificient salary from a great corporation would be now in the employment of the Government as a great expert of the foreign service if there had been this simple provision for his old age. That is the way to look at it. He did not leave the service because he is avaricious, but because he and his wife needed something for their old age.

Mr. ROGERS of Massachusetts. Because he was impoverishing himself serving the Government?

Mr. COOKER. Exactly.

Mr. ROGERS of Massachusetts. We thank you very much for your statement, Mr. Lay. It is almost time for the House to meet.

I would like to suggest my thought as to the course of these hearings. Mr. Gibson has not quite completed what he desires to lay before the committee. Mr. Carr testified very fully last year and will help the committee, we hope, in executive session, and perhaps will be required only in connection with the retirement provision to make a further formal statement. We have gone into that rather more scientifically, I think, than we did last year. We have had the best Government actuaries make a very careful examination of the matter, and the substitute which I have referred to is the result of the actuaries' suggestions. I think we shall have in substance a very similar retirement proposal, but in detail a very much more carefully planned and scientifically drawn proposal.

So if agreeable to the committee, I would recall Mr. Gibson for a few questions tomorrow and then have Mr. Carr testify for the record as to the substitute retirement proposition. After that I hope to close the hearings and to take up the bill in executive session, perhaps, the next day. As I have said before. I do not want in the least to cut off the hearings, especially if the new members of the committee are desirious of having them more extended. I should like to ask the members of the committee now if the programu which I have suggested is satisfactory to the committee.

Mr. COLE. It is.

Mr. LINTHICUM. I have been rather impressed with the advances made in these hearings, and I think we have brought out several good points which will be of advantage to the bill. One of them is the point which Mr. Connally brought out, in reference to the percentages of men in the first six classes. I think also the testimony of Mr. Gibson and Assistant Secretary Wright has been very valuable. I think these hearings—I am speaking for myself—ought to be rather complete. I think they ought to be so complete that a copy could be sent to the various diplomatic and consular officers throughout the world, and I feel it will also be pretty good material for the Senate. I would rather that Mr. Carr should not be limited, but have complete hearings. We have the time to do it.

Mr. ROGERS of Massachusetts. Would you like other witnesses to be called, besides hearing Mr. Gibson briefly and Mr. Carr at such length as the committee desires?

Mr. LINTHICUM. I think we should have very complete hearings because this is a very important bill.

Mr. CONNALLY. Call those opposed to the bill and let these gentlemen close.

Mr. COLE. Who is opposed?
Mr. CoNNALLY. I do not know of any.

Mr. LINTHICUM. We have 126 new members who might want to look over this matter. When you have a retirement feature it is not the easiest thing to get through the House.

Mr. ROGERS of Massachusetts. The committee will adjourn until to-morrow morning.

(Thereupon, at 11.45 o'clock a. m., the committee adjourned to meet again at 10 o'clock a. m., Thursday, January 17, 1924.)

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