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21 3DMINATION OF PAUL BURGESS FAY, JR.

GOVERNMEN'

StorageKSU LIBRARIES 

HEARING

BEFORE THE

COMMITTEE ON ARMED SERVI

UNITED STATES SENATE

EIGHTY-SEVENTH CONGRESS

FIRST SESSION

ON

NOMINATION OF PAUL BURGESS FAY, JR., OF CALIFORNIA

NOMINEE-DESIGNATE FOR UNDER SECRETARY OF THE NAVY

JANUARY 26, 1961

Printed for the use of the Committee on Armed Services

U.S. GOVERNMENT PRINTING OFFICE

64885 WASHINGTON: 1961
COMMITTEE ON ARMED SERVICES

RICHARD B. RUSSELL, Georgia, Chairman

HARRY FLOOD BYRD, Virginia

JOHN STENNIS, Mississippi

STUART SYMINGTON, Missouri

HENRY M. JACKSON, Washington

SAM J. ERVIN, JR., North Carolina

STROM THURMOND. South Carolina

CLAIR ENGLE, California

E. L. BARTLETT, Alaska

HOWARD W. QAMNON, Nevada

ROBERT C. BYRD, West Virginia

HARRY L. WINGATE, Jr., Chief Clerk

TI

STYLES BRIDGES, New Hampshire

LEVERETT SALTONSTALL, Massachusetts

MARGARET CHASE SMITH, Maine

FRANCIS CASE, South Dakota

PRESCOTT BUSH, Connecticut

J. GLENN BEALL, Maryland
CONTENTS

Statements of: rage

Engle, Hon. Clair, a U.S. Senator from the State of California 1

Fay, Paul Burgess, Jr., nominee-designate for Under Secretary of the

Navy 2

In
I NL
PAUL BURGESS FAY, JR., NOMINEE-DESIGNATE FOR

UNDER SECRETARY OF THE NAVY

THURSDAY, JANUARY 26, 1961

U.S. SENATE,

COMMITTEE ON ARMED SERVICES,

Washington, D.C.

The committee met, pursuant to notice, at 10.30 a.m., in room

212, Old Senate Office Building, Senator Richard B. Russell (chairman)

presiding.

Present: Senators Russell, Stennis, Symington, Engle, Cannon,

Bridges, Saltonstall, Smith, Case, and Beall.

Also present: William H. Darden of the committee staff; Harry L.

Wingate, Jr., chief clerk; T. Edward Braswell, Gordon Nease, of the

committee staff; and Herbert S. Atkinson, assistant chief clerk.

Chairman RUSSELL. The President has announced his intention of

nominating Mr. Paul Burgess Fay, Jr. of California as Under Secretary of the Navy. Mr. Fay is present this morning.

We welcome you, Mr. Fay, and congratulate you upon your selection.

If you will have a seat at the end of the table, we will be glad to see

whether your distinguished representative in the Senate, Senator

Engle, wishes to make any statement about your nomination.

STATEMENT OF HON. CLAIR ENGLE, A U.S. SENATOR FROM THE

STATE OF CALIFORNIA

Senator ENGLE. Yes, I do, Mr. Chairman. I have not had the

pleasure of knowing Mr. Fay personally or for very long, but he does

come from California, and we are very proud of his nomination to be

Under Secretary of the Navy.

He comes highly recommended to me from the people who do know

him and have known him over a long period of time.

He has had an outstanding record in the Navy in the Seco

War. The details of his record, his war record, are befor („44t •

biographical statement that is here on the desk.

(The biographical résumé of Mr. Fay follows:) REFERENCE

'1 LIBRARY

4. DEPARTMENT g`tC°3

"

BIOGRAPHY OF PAUL BURGESS FAY, JR.

Date and place of birth: July 8, 1918; San Francisco, Calif.

Father: Paul Burgess Fay (living).

Mother: Kate Oliver Fay (living).

Five sisters.

Wife: Anita Marcus Fay. Date of marriage, October 5, 1946.

• Children: Daughter, Katherine Finn Fay (age 1334); son, Paul Burgess Fay, III

(age 1134); daughter, Sally Symington Fay (age 434).

Grammar school: St. Joseph's Parochial, Menlo Park, Calif. Graduated in

1932.

1414TTAN,

1
2 NOMINATION OF PAUL BURGESS FAY, JR.

High school: Bellarmine Prep, Santa Clara, Calif. and Thacher School;

graduated in 1937.

College: Stanford University; graduated in 1941.

Military service: Entered the Navy under the V-7 program on July 1, 1942;

Motor Torpedo Boat Training Unit, November 1, 1942; joined Squadron 10 on

January 1, 1943, left the States in February 1943 and operated throughout the

South Pacific from Tulagi to Green Island—Southwestern Pacific and New

Guinea. For duty in the South Pacific received the Bronze Star Medal.

Instructed 9 months at the Hollywood Beach Hotel Officers' School, seamanship

department. Entered flight training on June 1, 1945, completed primary flight

course. War ended, and although given the option to remain in service for 2 years,

elected to return to civilian life.

Business activities: Worked with Fay Improvement Co., a family-owned

heavy construction firm in San Francisco. Last position there as executive vice

president.

Political activities: Assisted President Kennedy in his first campaign for

Congress. In 1960 was vice chairman of northern California and chairman of

San Francisco in the Citizens for Kennedy organization.

Senator ENGLE. Mr. Fay has worked with the Fay Improvement

Co., which is a family-owned heavy construction firm in San Francisco. His last position there was as executive vice president; and

I would say, Mr. Chairman, that Mr. Fay's experience in the Navy,

his intense interest in the Navy, his background as member of the

armed services, combined with his business experience, give him the

kind of qualifications, it seems to me, that augurs well for his service

in this particular capacity.

This does not appear in his biographical matter, but I am informed

he is a Republican, and I would like to say that we in California are

very broadminded about that, and we very often have bipartisan

support out there, and he did participate, as I understand, in President

Kennedy's original campaigns for Congress, so evidently he spent

some time in Massachusetts, and for that reason, geographically, he

is not, perhaps, as well spread as our previous nominee, but he has

been on both sides of the continent.

I do not have any hesitancy at all in recommending him, and I do

recommend him, and I am delighted to introduce him to this

committee.

Mr. FAY. Thank you, Senator.

Chairman RUSSELL. Mr. Fay, you may proceed to give us a brief

statement of your background and activities.

STATEMENT OF PAUL B. FAY, JR., NOMINEE TO BE UNDER

SECRETARY OF THE NAVY

Mr. FAY. Mr. Chairman and committee Senators, this is my first

venture into public life.

I was born in San Francisco, Calif., in 1918. I went to the parochial

system in the peninsula below San Francisco; I went to a private high

school, and I graduated from Stanford University in 1941.

I entered the Navy in 1942. I was in motor torpedo boats; I had

the distinction of operating in the division with our new President of

the United States.

To the surprise of my crew and myself I received the Bronze Star

Medal while in motor torpedo boats.

I came back to the United States in 1944, and I instructed in the

Officers Training School in Hollywood Beach, Fla.

After that I went into flight training down at Dallas, Tex., and

I was out of the Navy in March of 1946.
NOMINATION OF PAUL BURGESS FAY, JR. 3

I then went back to Boston, Mass., and served as personal manager

for the now President of the United States when he first ran for

Congress.

We shared a room together at the Bellevue Hotel, and that was my

first introduction to politics.

In October of 1946 I was married, and very happily married. I

have three children, a daughter Katherine 13, a boy Paul, who is 11,

and a daughter Sally, who has the distinction of being named Sally

Symington Fay, and she has the President of the United States as her

godfather.

In politics, my experience has been that I served as the chairman

of the Citizens for Kennedy in San Francisco in this last campaign,

and vice chairman of northern California of Citizens for Kennedy.

In San Francisco I served on the United Crusade in a minor capacity, and also on the St. Elizabeth Hospital advisory board.

My business experience has been in the heavy construction business, in a family-owned concern. With the help of my father I have

risen to the post of executive vice president of that firm, he being

president, and that is the end of my biography. [Laughter.]

Chairman RUSSELL. Mr. Fay, I assume that due to your relations

With the President, you have no intention of abandoning this position

until he indicates that he can no longer use your services?

Mr. FAY. That is correct.

Chairman RUSSELL. Mr. Fay, I notice that you advised the committee that you propose to sell common stocks you have in some

enterprises that might constitute a conflct of interests.

Mr. FAY. That is correct.

Chairman RUSSELL. And you also state that Fay Improvement

Co. has been doing some business with the armed services. Has that

been done on a bid basis or on a negotiated basis?

Mr. FAY. All our contracts with the armed services are on a bid

basis.

Chairman RUSSELL. The lowest bid; if you are not the lowest

bidder you did not receive the job?

Mr. FAY. That is correct.

Chairman RUSSELL. And you advise the committee here that you

have instructed that firm, and they have agreed, that they will not

even bid on any business with the Department of the Navy so long

as you are serving in this capacity?

Mr. FAY. That is correct.

Chairman RUSSELL. Senator Bridges?

Senator BRIDGES. I think Mr. Fay has covered the waterfront

pretty well in his associations with the distinguished President,

naming his daughter after our distinguished colleague Senator Symington, and has Senator Engle endorsing him, even though he might

have voted Republican sometime, so he is covered.

But, seriously, in our section of the country, and I do not mean

to be sectional, we are concerned about our industries and we are

concerned about our naval installations there, and there has been

mention in the President's budget that our Government was seriously

considering the elimination of some of the naval shipyards, and I

would like to know if you are at all familiar with that or not?

Mr. FAY. I am really not, Senator, in that I arrived here on Monday and I have been going through indoctrination classes since then.
NOMINATION OF PAUL BURGESS FAY, JR.

I am about halfway through, and I have about 3 more days. They

have been throwing it at me hour after hour, and I have not gotten

into any of the problems such as the one you mentioned.

Senator BRIDGES. But you are aware in accepting this position of

the role the Navy must play in national defense and you are aware,

are you not, of the vessels that need to be constructed for the vital

defense, such as the Polaris submarine and various other types of

submarines?

Mr. FAY. Yes, I am Senator.

Senator BRIDGES. And you know, for instance, that in our own

section of New England, which includes Maine an New Hampshire,

we call it the Portsmouth Navy Yard, but when Mrs. Smith is present

I always call it the Portsmouth-Kittery Navy Yard, we build the

best submarines in the country. I sincerely hope that you are going

to look into the matter very seriously before there is any proposal

to eliminate or reduce any of the naval shipyards, in the interest of

our national security.

Mr. FAY. That is correct, Senator.

Senator BRIDGES. Thank you.

Chairman RUSSELL. Senator Stennis?

Senator STENNIS. Mr. Chairman, I think the Navy is getting along

all right with this genial friend here and his fine sense of humor. I

am sure he has ability, too.

I notice the press has announced that one of our former staff members here, Mr. Kenneth BeLieu, is going to be Assistant Secretary

of the Navy for Materiel.

Mr. Fay, I think you have a big job, and I feel like you will work

hard at it, and I certainly wish you well in it.

We also build submarines, you understand, down in the southern

part of this country on competitive bidding on a quality basis down

at Pascagoula, Miss.

You do not, in your adherence to Senator Bridge's and Mrs.

Smith's idea of the Navy staying in business, too, mean that you

are going to crowd out the private contractors?

Mr. FAY. I am sure not.

Senator STENNIS. Is that correct? They stay in business on a

quality basis: is that correct?

Mr. FAY. That is correct, Senator.

Chairman RUSSELL. Senator Saltonstall?

Senator SALTONSTALL. Mr. Chairman, we have heard a lot about

the Portsmouth-Kittery Navy Yard.

We also, Mr. Fay, have one in Boston, and also a very fine shipyard

in Boston, in Massachusetts, so when you go up that way I hope you

will give consideration to those two very fine yards, as well as the

Portsmouth-Kittery yard which, I know, is an equally fine one, but

a little bit of competition here and there.

Mr. FAY. I certainly will, Mr. Senator.

Chairman RUSSELL. Mr. Secretary-to-be, Georgia does not have

any naval yard, but we are one of the original States, and we are on

the Atlantic Ocean. Please see if you can find anything for us.

[Laughter.] Senator Symington.

Senator SYMINGTON. Mr. Chairman, inasmuch as Mr. Fay and I

are related through marriage, naturally I am for him regardless of

party. Moreover, it is true that he has worked hard for the members
NOMINATION OF PAUL BURGESS FAY, JR. 5

of the party. I am also for him because he is an able and outstanding

citizen of his State, and I am sure that he will do a fine job in this

field.

He has been in the construction business over many years, as

has his family before him, and we all know how important this

experience is to the job which he plans to undertake.

Mr. Fay, inasmuch as you heard from the Massachusetts-Maine

Navy line over here on the other, side of the table about the importance of submarines, I would like to ask you to give consideration

to putting a_ few submarines in Missouri. We may not be equipped

to handle them., but like Sears, Roebuck, if we haven't got it in stock

we will be glad to get it.

Mr. Chairman, I would say one of the most pleasant things about

this nomination is that it probably means that Mr. Fay's mother

and father will be in Washington more often.

, Mr. FAY. Thank you very much, Senator.

Senator SYMINGTON. It is a privilege to see your, sir.

Chairman RUSSELL. Senator Smith?

Senator SMITH. Mr. Chairman, thank you.

. Mr. Fay, would you please give serious consideration as Under

Secretary of the Navy to putting the Kittery-Portsmouth yard

workers on a pay equalization with the Boston yard workers.

Mr. FAY. I certainly will give it serious consideration, Senator.

Senator SMITH. Thank you, sir.

Chairman RUSSELL. Senator Engle?

Senator ENGLE. No questions.

Chairman RUSSELL. Senator Case?

Senator CASE. Mr. Chairman, I would not ask this question except

for the connotation. I thought I understood Senator Engle to say

that the nominee was a Republican, and the nominee stressed that he

assisted President Kennedy in his first campaign for Congress, and

was vice chairman of the Citizens for Kennedy organization.

Were you living in the East at the time you assisted Mr. Kennedy?

Mr. FAY. No; I was not, Senator. When I got out of the Navy I

went back, before I went into business, and I helped Senator Kennedy

at that time.

Senator ENGLE. He is just a broadminded Republican.

Senator SYMINGTON. And his father is a good Democrat.

Senator ENGLE. I guess.

Mr. FAY. That is correct.

Senator CASE. Are you attempting to discount or to modify or to

deny the Republican affiliations which Senator Engle indicated?

Mr. FAY. No; I am not, Senator. I am very proud of the fact

that I consider myself a very close friend of the President; and I have

been for many years.

I have been a great admirer of his actually since I first met him back

in 1942, and I have been willing ever since that first meeting to do

anything for him in his efforts.

Senator CASE. Well, I have no objection to that or any feeling about

that, but I was just wondering, you brought out, since you assisted

Mr. Kennedy in his first campaign for Congress, I was wondering how

the Republican affiliation came in.

Mr. FAY. No; I have actually voted the Republican ticket all my

life except for this election.
6 NOMINATION OF PAUL BURGEISS FAY, JR.

Senator CASE. Thank you, Mr. Chairman.

Chairman RUSSELL. Senator Cannon.

Senator CANNON. Thank you, Mr. Chairman. Mr. Fay, I just

want to point out that while Nevada is a land-locked State we have

three very important naval installations in our State.

Thank you, Mr. Chairman.

Chairman RUSSELL. Senator Beall.

Senator BEALL. Mr. Chairman, I do not have any particular questions except I think I would be remiss in my duties if I did not call

the Secretary's attention to the fact that we have a number of naval

installations in Maryland, chiefly the Naval Academy.

Mr. FAY. Yes.

Senator BEALL. At Annapolis; and there was a little movement

several years ago to transfer part of the Academy or something to

California.

I hope, as a native Californian, you are not going to let Senator

Engle and his colleague take the Naval Academy from Annapolis.

Senator ENGLE. We will not do that; we promise you.

Chairman RUSSELL. If there are no further questions, we thank

you, Mr. Fay, and the committee will now resolve itself into executive

session.

(Whereupon, at 11:35 a.m., the committee adjourned to go into

executive session.)

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