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YLI KANSAS STATE UNIVERSITY LIBRARIES

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92/2iMINATIONS OF FROEHLKE, SHILLITO,

AND LINCOLN

GOVERNMENT

Storage

HEARING

BEFORE THE

COMMITTEE ON ARMED SERVICES

UNITED STATES SENATE

NINETY-FIRST CONGRESS

FIRST SESSION

ON

HONORABLE ROBERT F. FROEHLKE—TO BE AN ASSISTANT

SECRETARY OF DEFENSE

HONORABLE BARRY J. SHILLITO—TO BE AN ASSISTANT

SECRETARY OF DEFENSE

GENERAL GEORGE A. LINCOLN—TO BE DIRECTOR OF THE

OFFICE OF EMERGENCY PREPAREDNESS

JANUARY 28, 1969

Printed for the use of the Committee on Armed Services

U.S. GOVERNMENT PRINTING OFF I (W.

24 .471 WASHINGTON : 1969
COMMITTEE ON ARMED SERVICES

JOHN C. STENNIS, Mississippi, Chairman

RICHARD B. RUSSELL, Georgia

STUART SYMINGTON, Missouri

HENRY M. JACKSON, Washington

SAM J. ERVIN, JR., North Carolina

HOWARD W. CANNON, Nevada

STEPHEN M. YOUNG, Ohio

DANIEL K. INOUYE, Hawaii

THOMAS J. MeINTYRE, New Hampshire

HARRY F. BYRD, JR., Virginia

T. EDWARD BRASWELL, Jr., Chief of Staff

CHARLES B. KIRBOW, Chief Clerk

MARGARET CHASE SMITH, Maine

STROM THURMOND, South Carolina

JOHN G. TOWER, Texas

PETER H. DOMINICK, Coloradoi

GEORGE MURPHY, California

EDWARD W. BROOKE, Massachusetts

BARRY GOLDWATER, Arizona

RICHARD S. SCHWEIKER, Pennsylvania
CONTENTS

Statement by— Page

Hon. Robert F. Froehlke to be an Assistant Secretary of Defense

(Administration) 2

Gen. George A. Lincoln to be Director of the Office of Emergency

Preparedness 11

Hon. Barry J. Shillito to be an Assistant Secretary of Defense

(Installations and Logistics). 6

(m)

NOMINATIONS

TUESDAY, JANUARY 28, 1969

U.S. SENATE,

COMMITTEE ON ARMED SERVICES,

Washington, D .0 .

The committee met, pursuant to notice, at 10:05 a.m., in room 212,

Old Senate Office Building, Senator John Stennis (chairman)

presiding.

Present: Senators Stennis, Symington, Jackson, Cannon, Young (of

Ohio), Byrd, Jr., of Virginia, Smith, Thurmond, Dominick, Brooke,

Goldwater, and Schweiker.

Also present: T. Edward Braswell, Jr., chief of staff; Gordon A.

Nease, and Labre R. Garcia, professional staff members; Charles B.

Kirbow, chief clerk; and Herbert S. Atkinson, assistant chief clerk.

The CHAIRMAN. The committee will please come to order.

Several gentlemen who have been nominated for important offices

are before us, and we have a carry over from last week of several other

nominees who appeared before us. You will recall there was not time

to finish last week since the members had to go to the Senate to vote,

We have another vote today in the Senate at 1 o'clock. That is one

of the reasons I scheduled this meeting at 10 a.m. instead of 10:30.

I regret the absence of Senator Smith. She is now one of the chief

advisers to the President of the United States and she is at the White

House. She will be here in a few minutes, however.

Senator Symington expresses his regrets that he could not stay, but

he had a firm commitment at Foreign Relations Committee on a pending matter, and asked to be excused.

If it is the pleasure of the committee now, we will proceed in open

session and then have an executive session, of course.

The first nominee today will be Mr. Robert F. Froehlke, who has

been selected for Assistant Secretary of Defense (Administration).

Mr. Froehlke has completed broad experience as an insurance industry executive. His management experience should provide an ample

background for the duties to which he has been nominated.

We also have here today Mr. Barry J. Shillito who has been nominated for Assistant Secretary of Defense (Installations and Logistics).

Then we will hear General George A. Lincoln, who has been nominated

to be Director of the Office of Emergency Preparedness. The name of

that Office was changed last session, from Office of Emergency Planning to the Office of Emergency Preparedness, and the Director is a

member of the National Security Council and is the President's

designee on the matter of Federal-State relations.

(11
2

If it is the pleasure of the committee now, we will ask Mr. Froehlke

to come forward, please.

NOMINATION OF ROBERT F. FROEHLKE TO BE ASSISTANT

SECRETARY OF DEFENSE (ADMINISTRATION)

The CHAIRMAN. Again, we regret we did not get to you last week.

Perhaps you are a wiser man now than you were then. We are delighted

to have you here.

Did you have a statement that you would like to make?

STATEMENT OF ROBERT F. FROEHLKE, NOMINEE, TO BE ASSISTANT

SECRETARY OF DEFENSE (ADMINISTRATION)

Mr. FROEHLKE. No; sir. With the exception of military service during World War II this is my first opportunity for public service and,

this committee and the Senate willing, I look forward to serving.

The CHAIRMAN. We would like you to make a statement about yourself. There is a biographical sketch in front of all the senators, but I

would like you to tell us something of your background, where you

were born, what military service, if any, you have had and where you

live now and so forth.

(The nomination reference and biography of Mr. Froehlke follow:)

NOMINATION REFERENCE AND REPORT

IN EXECUTIVE SESSION,

SENATE OF THE UNITED STATES,

January 21 (legislative day, January 10), 1969.

Ordered, That the following nomination be referred to the Committee on Armed

Services:

Robert F. Froehlke, of Wisconsin, to be an Assistant Secretary of Defense.

BIOGRAPHICAL SKETCH OF ROBERT F. FROEHLKE

Born: October 15, 1922; birthplace: Neenah, Wisconsin.

Education: Marshfield, Wisconsin school system. Marshfield Senior High

School (1940). Attended the University of Wisconsin from 1940 to June 1943.

Entered the University of Wisconsin Law School in January 1947 and graduated

with an LL.B. in June 1949 (Order of Coif).

Military: Served in the United States Army from June 1943 through September 1946. Discharged as a Captain in the Infantry.

Experience: From 1949 to September 1950—Associate in the Madison, Wisconsin Law firm of McDonald and MacDonald.

From 1950 to September 1951—Faculty of the University of Wisconsin Law

School.

From September 1951 until January 1, 1959—Legal Department of Hardware

Mutuals in Stevens Point, Wisconsin. Assistant General Counsel.

From January 1, 1959 to January 1, 1967—Executive Vice President of Sentry

Life Insurance Company.

From January 1, 1967 until August 12, 1968—Executive Vice President of

Sentry Life Insurance Company and Vice President-Sales for Sentry Life Insurance Company, Hardware Mutual Casualty Company and Hardware Dealers

Mutual Fire Insurance Company.

From August 12, 1968 to the present—Resident Vice President of Sentry Insurance in Boston, Massachusetts.

Business affiliations: Chairman of the Board of Sentry Indemnity Company;

President of Sentry Life Insurance Company of New York; Vice President of the

Sentry Corporation. Member of the Board of Directors of Hardware Mutual

Casualty Company, Hardware Dealers Mutual Fire Insurance Company, Sentry

Life Insurance Company, Sentry Life Insurance Company of New York, Sentry
3

indemnity Company and the Sentry Corporation. Member of the American Bar

and Wisconsin Bar Associations. Member of the Executive Committee of the

Health Insurance Council.

Married: November 9, 1946 to the former Nancy J. Barnes of Marshfield,

Wisconsin. Children: Bruce (19), Jane (16), Ann (13) and Scott (12). Residence: 89 Thornberry Rd., Winchester, Massachusetts.

Mr. FROEHLKE. Mr. Chairman, I was born in Wisconsin in 1922,

graduated from high school in Marshfield, Wis. and from the University of Wisconsin Law School. I served a little over 3 years in the

Infantry and was discharged honorably as a captain.

Upon graduation from law school in 1949, I practiced law briefly

and then joined the faculty of the law school at the University of

Wisconsin.

In the fall of 1951, I joined the insurance firm known now as Sentry

Insurance. I became assistant general counsel, and in 1958 was instrumental in forming a new life company. I was the first employee and

was the operating head of this life company for 10 years.

In 1968, I moved to Boston, where I presently reside. I am a member

of the board of the various companies comprising this firm.

The CHAIRMAN. This is not a personal question, but I would just

like to ask you why are you doing this? Why do you wish to do this?

Why are you giving up this fine business, your home? What's your

idea about it? Just tell us.

Mr. FROEHLKE. There is no one answer, Mr. Chairman. I think it is

a combination of things.

First of all, I suppose, a duty you have when you are asked to serve;

also, I have a personal relationship with the Secretary of Defense and

I have great respect for him. If I have an opportunity to help him,

help the office, and help the country, I am very happy to do so.

The CHAIRMAN. You were invited, and I suppose urged by Secretary

Laird, is that right?

Mr. FROEHLKE. Yes, sir.

The CHAIRMAN. HOW long do you you now expect to serve?

Mr. FROEHLKE. At the pleasure of the President and the Secretary

of Defense.

The CHAIRMAN. That is the right answer. We really are not interested in a man coming down here temporarily. That is not personal,

but is serious business. It takes a man awhile to get his hand on the

steering wheel. If you are going to get any satisfaction out of it, you

are going to have to stay awhile.

So your present expectation is firm that you will serve for the foreseeable future, as far as you can tell now, at the pleasure of the

President?

Mr. FROEHLKE. Yes, sir.

The CHAIRMAN. You will be coming before this committee and you

will be the spokesman of the President of the United States. He is a

man of candor and frankness, and you expect to be the same here with

this committee, I am sure.

Mr. FROEHLKE. That is correct.

The CHAIRMAN. We do not think it is our duty to cross-examine

witnesses and probe and try to find out what may be in between the

paragraphs. We think it is your duty to come here. You do not come

as an advocate, you come to bring facts and you are supposed to disclose all the relevant facts pertaining to a matter and do it voluntarily.

Is that the way you feel?
4

Mr. FROEHLKE. That is my intention.

The CHAIRMAN. Will you do that?

Mr. FROEIILKE. Yes, I will.

The CHAIRMAN. With those under you, in and out of uniform, will

you insist on their doing the same?

Mr. FROEHKLE. I will.

The CHAIRMAN. You are in administration. You will not be tied

directly to men in uniform, but without praising them, we think that

they are entitled to be considered, the top ones, as your advisers, and

you expect to do that?

Mr. FROHLKE. Yes.

The CHAIRMAN. I believe that is all the questions I have.

You have filed a letter with the committee insofar as as your holdings are concerned that I think, and in the opinion of Mr. Braswell,

our chief of staff, meets all the requirements of conflict of interest.

This is something you have already complied with, as I understand

it?

Mr. FROEHLKE. I have not complied with it but I will momentarily.

The CHAIRMAN. You have made up your mind and if confirmed,

you will do it?

Mr. FROEHLKE. That is correct.

(The letter referred to follows:)

JANUARY 22, 1969.

Hon. JOHN STENNIS,

Chairman, Committee on Armed Services,

U.S. Senate, Washington, D.C.

DEAR Mn. CHAIRMAN: In relation to my nomination for the position of Assistant Secretary of Defense, this letter is to advise you of my financial circumstances.

At the present time I own stock in the companies listed in attachment A.

I have discussed these holdings with counsel for the Department of Defense and

I am advised that those companies listed in attachment B are on the Department

of Defense statistical list of contractors having one or more contracts in the

amount of $10,000 with the Department of Defense. If confirmed by the Senate,

I would propose to dispose of the securties listed in attachment B within sixty

days.

My present employment is with the Hardware Mutual Casualty Company, which

is a part of the insurance group known as Sentry Insurance. I would propose to

take leave of absence from this company for the purpose of protecting my accumulated rights in the pension system. I am advised that such an arrangement

is permitted under section 209 of title 18 of the United States Code. In this

connection I am advised that the Hardware Mutual Casualty Company does not

have any contracts with the Department of Defense.

Except as noted above, I have no employment or other relationships with any

other companies or institutions.

I trust the foregoing arrangements will be satisfactory to the Committee.

Respectfully yours,

ROBERT F. FROEFILKE.

Attachments.

ATTACHMENT A

Celanese Corporation of America; Cornelius Company; Dairy State Market;

Dennison Manufacturing Company; First National Bank of Stevens Point,

Wisconsin; General Dynamics Corporation; General Telephone and Electronics

Corporation; North Central Airlines; Revlon, Inc.; Scientific Data Systems, Inc.;

Sentry Life Insurance Company; and Tektronix, Inc.

ATTACHMENT B

Celanese Corporation of America; Dennison Manufacturing Company; General

Dynamics Corporation; General Telephone and Electronics Corporation; Revlon, Inc.; Scientific Data Systems, Inc.; and Tektronix, Inc.
5

The CHAIRMAN. Senator Thurmond, we are glad you are here, sir.

Do you have any questions? I call on you first.

Senator THURMOND. Mr. Chairman, I had already looked over the

biographies of all these nominees this morning. I think they are all

well qualified. I am going to leave my proxy to vote for them. I have

three committee meetings and I have to go to others on other matters.

The CHAIRMAN. You do not have any more important than this one,

but under the circumstances 

Senator THURMOND. I have already studied on these people and I

am satisfied with the nominees before us this morning.

The CHAIRMAN. I was speaking of your importance to the committee as well as the committee's importance to you.

Senator THURMOND. Thank you, Senator. I may be back. I will be

back as soon as I can get through with these other meetings.

The CHAIRMAN. Thank you very much.

Senator Young?

Senator YOUNG of Ohio. Thank you, Mr. Chairman.

I have gone over the biographical sketch and made some inquiry

and it seems to me this is an excellent appointment that the Secretary

of Defense made and I am prepared to support it.

The CHAIRMAN. Thank you, Senator.

Senator BROOKE?

Senator BROOKE. Mr. Chairman, I know Mr. Froehlke I have had

an opportunity to talk with him. Though he was born in Wisconsin, he

presently resides in Massachusetts. Though he has only been there a

short period of time, he has already earned an invaluable reputation

in the business community and I think that Mr. Nixon and Mr. Laird

have chosen wisely in asking Mr. Froehlke to come into the Defense

Department. I only have one question.

Are you a beneficiary under any trust?

Mr. FROEHLKE. Unfortunately, no.

Senator BROOKE. What you have disclosed in your letter to the chairman represents any holding, partnership, or any business organization

at all which has any contracts with the Defense Department?

Mr. FROEHLKE. That is correct. I am still on the board of the Sentry

Insurance firms but will resign, if the Senate does confirm me.

Senator BROOKE. But the Sentry Insurance Co. has no contracts?

Mr. FROEHLKE. No, but I still will resign.

Senator BROOKE. Mr. Chairman, I have no further questions. I just

want not only to commend the Secretary of Defense for having chosen

so wisely, but also to thank Mr. Froehlke for giving up a very lucrative

business to come to the Government and to serve as Assistant Secretary.

Mr. FROEHLKE. Thank you, Senator.

The CHAIRMAN. Senator Byrd?

Senator BYRD JR. (of Virginia). Thank you, Mr. Chairman. I am

well impressed with the nominee and I have no questions.

The CHAIRMAN. Senator Goldwater?

Senator GOLDWATER. Mr. Chairman, I have no questions. It is my

pleasure and privilege to support him.

The CHAIRMAN. Mr. Schweiker ?

Senator SCHWEIKER. I have no questions, Mr. Chairman.

The CHAIRMAN. Mr. Froehlke, is there anything you want to say?

Mr. FROEHLKE. No, Mr. Chairman.

24-477-69-2
The CHAIRMAN. Mr. Braswell, do you have any other points in

mind?

Mr. BRASWELL. No, sin

The CHAIRMAN. We have nothing further. You may wait if you

wish, though we do not except to have you any more.

That brings us to Mr. Shillito.

(The nomination of Mr. Froehlke to be an Assistant Secretary of

Defense was subsequently approved by the committee in executive

session, and confirmed by the Senate on January 29, 1969.)

NOMINATION OF BARRY I. SHILLITO TO BE ASSISTANT SECRETARY

OF DEFENSE (INSTALLATIONS & LOGISTICS)

The CHAIRMAN. There is a biographical sketch before each Senator.

(The nomination reference and biographical sketch of Mr. Shillito

follow:)

NOMINATION REFERENCE AND REPORT

IN EXECUTIVE SESSION,

SENATE OF THE UNITED STATES,

January 23 (legislative day, January 10), 1969.

Ordered, That the following nomination be referred to the Committee on Armed

Services:

Barry James Shillito, of Ohio, to be an Assistant Secretary of Defense.

BIOGRAPHY OF BARRY J. SHILLITO

Barry James Shillito was born in Dayton, Ohio on January 1, 1921, son of the

late Lucian W. and Mary Ellen (O'Connor) Shillito. He attended grade schools

and high school in the Dayton, Ohio area graduating from Chaminade high

school. Prior to World War II he attended the University of Dayton.

He enlisted in the Army Air Corps in 1942 and completed training necessary to

become initially a fighter and later a bomber pilot. He was assigned to the 8th

Air Force in England and shot down in late 1943. He was a prisoner of war in

Germany from that time to the completion of hostilities. After the war he obtained both commercial and instructor pilot licenses. He also completed his

undergraduate training at the University of Dayton, and in 1949 received his

B.S. degree.

In 1945, while completing his education, Mr. Shillito began his business career.

He was General Manager of the Harris-Lincoln Supply Company in Dayton, Ohio.

This compan-y was primarily concerned with the sale and installation of welding

equipment From 1949 to 1954 Mr. Shillito was Section Chief and Contracting

Officer of the Procurement Division, USAF Headquarters, Air Material Command,

Wright-Patterson Air Force Base. In this capacity he was primarily concerned

with the acquisition of electronic fire control systems for U.S. Air Force interceptor aircraft. He also became chairman of the fighter fire control systems

phasing group which preceded the present project management concept.

In 1954 Mr. Shillito became Director of Material at the Hughes Aircraft Company, Culver City, California. In 1958 he completed the Advanced Management

Program at the University of California in Los Angeles. In 1958 he also became

Director of Sales for Hughes Aircraft Company. In 1959 Mr. Shillito joined the

Houston Fearless Corporation as Executive Vice President, becoming President

in 1960. In 1962 he became President of the Logistics Management Institute, a

private, non-profit, fact finding and research organization concerned with major

defense logistics problems. He remained in that position until his appointment

as Assistant Secretary of the Navy (Installations and Logistics), assuming office

on April 9, 1968.

Mr. Shillito is presently a member of the Armed Forces Management Association, the Young Presidents Organization, Fellow in the Society of Logistic

Engineers, the Alumni Association of the University of Dayton and UCLA, the

Advisory Board of the National Contract Management Association (life time
7

member), the American Legion, Knights of Columbus, Kenwood Country Club,

Washington, D.C. and Moraine Country Club, Dayton, Ohio. He is a past director

of several companies and organizations.

Since December 2, 1942, Mr. Shillito has been married to the former Eileen

Elizabeth Cottman of Dayton, Ohio. They have five children: Barry, Jr.

'

Elaine,

Daniel, James and Colleen. His current address is 5004 Baltan Road, Sumner,

Maryland.

The CHAIRMAN. Mr. Shillito, you have been nominated for Assistant Secretary of Defense for Installations and Logistics. You were

appointed Assistant Secretary of the Navy for Installations and Logil,-

tics in April of 1968. Have you anything to say now, sir, to the committee, formally or informally?

STATEMENT OF BARRY J. SHILLITO, NOMINEE, TO BE ASSISTANT

SECRETARY OF DEFENSE (INSTALLATIONS AND LOGISTICS)

Mr. SHILLITO. Mr. Chairman, my only comment would be that it

seems like the last 10 months since I last appeared before this committee have gone past quite rapidly. I do feel it is an honor to have the

opportunity to be back again. You have my biographical sketch. I will

be glad to give you another brief rundown on myself if you so desire.

The CHAIRMAN. Since you have been before the committee before,

will you make your statement brief?

Mr. Siimixro. I was born in Dayton, Ohio, in 1921.1 attended schools

in the Dayton area, attended the University of Dayton. My undergraduate training was interrupted due to World War II.

I enlisted in the Army Air Corps, was a pilot in the Army Air

Corps. My time overseas was spent with the 8th Air Force. I spent

from late 1943 through the balance of the European war as German

POW. At the end of the war, I came back and was involved in the

formation of a welding supply company in Dayton, Ohio.

Concurrent with this, I was an undergraduate at the University

of Dayton, receiving by B.S. degree in 1949. I was asked to come back

into the Air Force as a civilian and become a contracting officer and

section chief in the procurement division at Wright-Patterson Air

Force Base. I was also chairman of what was then called the fighter

fire control systems phasing group.

In 1954, I went to Hughes Aircraft Co. and became director of

materiel.

I went to graduate school in the late 1950's and finished the advance

management program at UCLA in 1958. The same year I became director of marketing at Hughes.

In 1959, I became executive vice president and shortly thereafter

president of the Houston Fearless Corp., headquartered in Los Angeles.

In 1962, I was asked to come back here and assist in formation of

the Logistics Management Institute, which I did. This is a researchoriented economics, mathematics and industrial engineering organization, primarily interested in defense and defense industry logistics

problems and their solution. I served as president of LMI until

April of last year.

In March of last year, I was asked to become Assistant Secretary of

Navy (I. & L.), and did do so in April. Recently, I was asked to become

Assistant Secretary of Defense for Installations and Logistics.
8

I live in Sumner, Md., with my wife and five children and have given

the committee a recap of my holdings. These have been discussed with

DOD counsel and have been approved.

The CHAIRMAN. You have already been in the public service, but I

want to ask you anyway, why did you come into public service?

Mr. SHILLITO. I guess I would have to say my wife has asked me that

question once or twice, too, Mr. Chairman.

I enjoy it very much. It is rewarding in many ways. I feel as though

we have an obligation to the country. I think the country has been

awfully good to me in many ways.

I think in spite of what people may say, we take a lot more away

from this kind of environment than we give. It is a very rewarding

environment. It is also a fine group of dedicated people that I find

myself associated with day in and day out.

The CHAIRMAN. I think that is a mighty good answer and I am

proud of it. I hope there will always be plenty of fine people, ladies and

gentlemen, who like to be in public service.

How long in your expectations do you expect to serve?

Mr. SHILLITO. You asked me this question in April.

The CHAIRMAN. Yes.

Mr. SHILLrro. I said then that I had no specific plans as to when

I would be leaving government service. This still applies. I will serve.

at the pleasure of the President and Secretary of Defense. I have no

specific plans.

The CHAIRMAN. I am proud of that answer.

I might just observe that the office that you are going to be assigned

to is an outgrowth, in a way, of a little amendment that I got accepted

some 10 or 12 years ago, when I was chairman of the Subcommittee

on Military Construction of the Armed Services Committee. I could

not find anyone in the Pentagon who was charged with the special duty

and responsibility for the cost and the overrun of military construction. So I was instrumental in having set up within the Department

of Defense a small office to oversee military construction matters. It

has grown now into Assistant Secretary of Defense for Installations

and Logistics. That logistics is about as long a word with as broad a

meaning as you can find.

It is a highly important position you are in. We are finding out

that the increased cost of these modern weapons is jut tremendous.

When I came here as a member of the committee, you could buy a

pretty good submarine for $30 million. I am not going to give—it may

be classified—what one of these future super ones is going to cost, but

it is astronomical. We have these overruns. I want you to say that you

will give special attention to it.

One of the things the committee is going to try to do is get a tabulation of the overruns in cost—not just military construction, but these

weapons systems.

You are already familiar with that subject, I know.

Mr. SHILLITO. Yes, sir, I am.

The CHAIRMAN. You have been over there since April. What are

you going to try to do about it? Or is there anything that you can do

as Assistant Secretary?

Mr. SHILLITO. Most of the things that can be done are going to warrant a lot of additional study and analysis on the part of many of us.
9

I know, for example, that we have been quite concerned about the

overruns in some of our shipbuilding operations. We have started

off a study in the last several months dealing with this. We hope that

by March, we will have this study completed and hopefully, it will

lead us to a number of sound recommendations.

I would like not to suggest that we do this specifically or something

else specifically right now, Mr. Chairman, but you are absolutely correct. It is a most serious subject and one that has concerned me very

much over the last 10 months.

The CHAIRMAN. I was going to say if you clearly recognize the

problem, and assure this committee that you are going to try your very

best to do something about it, that is the extent of the answer. Is that

your purpose?

Mr. SHILLITO. It certainly is, Senator.

The CHAIRMAN. Your promise, too?

Mr. SHILLITO. Yes, sir.

The CHAIRMAN. Let me point out to the committee at this point

that as a matter of law, both Mr. Froehlke and Mr. Shillito are nominated as Assistant Secretaries of Defense without regard to job designation. Their assignments are designated administratively. There are

only two assistant secretaryships in Defense, that of comptroller and

personnel, where the duties are designated as a matter of law. I thought

that was a matter of interest to the committee.

You have heard my questions about candor and frankness and fullness with reference to testimony here. What is your answer to that?

Mr. SHILLITO. I will do everything that I possibly can do to assure

that anything and everything that I have to express to this committee

will be frankly and candidly known to them.

The CHAIRMAN. That is fine, and you will use your influence with

others in the same way?

Mr. SHILLITO. Yes, sir.

The CHAIRMAN. And you expect to continue to consider the advice

of the military—I did not say follow, but consider the advice and

counsel of our military professional men?

Mr. SHILLITO. Yes, sir.

The CHAIRMAN. Senator Brooke, I call on you next.

Senator BROOKE. Mr. Secretary, do you have any present connection

with Houston Fearless?

Mr. SHILLITO. No, sir, I do not. I sold all my stock in Houston

Fearless immediately upon coming back here. I did have a convertible

debenture that I liquidated about 2 years ago, as I recall, after coming

back here. So I have had no connection with Houston Fearless for

almost 7 years.

Senator BROOKE. No connection whatsoever currently?

Mr. SHILLITO. No, sir.

Senator BROOKE. Are you the beneficiary of any trust?

Mr. SHILLITO. No, sir.

Senator BROOKE. Mr. Shillito, would you compare the job you

presently hold as an Assistant Secretary of the Navy and the job responsibilities in the position that you will be designated to as an

Assistant Secretary of Defense?

Mr. SHILLITO. Senator Brooke, there is a degree of similarity between these two jobs. The Navy job is a little more an operating job
10

than the Assistant Secretary Of Defense job. In the Assistant Secretary

of Defense job, I would find myself the principal staff assistant to

the Secretary of Defense on installations and logistics matters. In

the Navy job, the responsibilities would be comparable, but as the

principal staff assistant to the Secretary of the Navy.

At the same time, we do find at the service level that we get into more

problem areas, get more deeply involved as to selections, source selections, more deeply involved in the intimate problems of dealing with

installations than would be the case at the Secretary of Defense level.

Policy is more the concern of the ASD [I and L].

Senator BROOKE. More?

Mr. SHILLITO. In the Assistant Secretary of Defense job, the policy

problem is more paramount. This is the way I would look at my

present job and the ASD [I and L] job. There is quite an interrelationship between the two, sir.

Senator BROOKE. Is there overlapping?

Mr. SHILLITO. No, sir, there is not. You find that the individual

service assistant secretaries, in each of the functional areas, work

quite closely with the Assistant Secretary of Defense in their functional areas. A great deal of their time is spent carrying out the policies

that evolve at the Assistant Secretary of Defense level in their functional areas. I would not call it overlapping, sir.

Senator BROOKE. Thank you.

No further questions, Mr. Chairman.

The CHAIRMAN. Thank you, Senator.

Senator Young, that brings us to you, sir.

Senator YOUNG of Ohio. Mr. Chairman, I know Mr. Shillito and

voted to confirm him in the past and I hope to become better acquainted

with him. I take pride in the fact that—I believe it is a fact—that

he has spent about three-fourths of his life in the State of Ohio, where

he was born and reared. So I am going to be very happy to support

my fellow Ohioan for this appointment. I feel that he will do a

splendid job in this position.

The CHAIRMAN. Thank you, Senator.

Senator Qoldwater ?

Senator GOLDWATER. I have no questions, Mr. Chairman. I have

known this man directly and it will be a great pleasure to support him.

The CHAIRMAN. Thank you, Senator.

Senator Byrd?

Senator BYRD, JR. of Virginia. Thank you, Mr. Chairman. I am

glad to support the nominee. I have no questions.

The CHAIRMAN. Senator Schweiker ?

Senator SCHWEIKER. No, Mr. Chairman. I am pleased to support

the nomination.

Senator YOUNG of Ohio. I guess you are going to make it. It was a

tough fight.

The CHAIRMAN. Do you have anything else you wish to say, sir?

Mr. SHILLITO. No, thank you, Senator.

The CHAIRMAN. Well, so far, my impression is you have made a

good start over there. I hope you keep on. We will have some business

with you, and will be asking you to come back. You have fully satisfied

the Chairman and the Chief of Staff as to these holdings on alleged

conflict of interest, sir. If anyone wants to go into it further, they can,

of course.
11

(A letter from Mr. Shillito follows:)

THE ASSISTANT SECRETARY OF THE NAVY,

(INSTALLATIONS AND LOGISTICS),

Washington, D.C., January 27, 1969.

Hon. JOHN STENNIS,

Chairman, Committee on Armed Services,

U.S. Senate,

Washington, D.C.

DEAR Mn. CHAIRMAN: In relation to my pending nomination to be Assistant

Secretary of Defense for Installations and Logistics this letter is to advise

you of my current financial circumstances. 1 hold the securities which are listed

in the attachment to this letter. I have discussed this list with Counsel for the

Department of Defense and I am advised that none of these entities appears

on the statistical listing of Department of Defense contractors.

In connection with my nomination for the position of Assistant Secretary of

the Navy I advised the Committee, in a letter dated March 28, 1968, of my

intention to liquidate all interests in American Systems, Inc. against the possibility that American Systems might acquire Defense Department business.

Although American Systems, Inc. is still not a contractor with the Department

of Defense, I have sold my stock in this company and, as soon as possible, intend

to liquidate a convertible debenture which I still hold.

I do not have any memberships in Boards of Directors or any employment

relationships other than my current status as an Assistant Secretary of the

Navy.

I trust the arrangement outlined above will be satisfactory to the Committee.

Respectfully yours,

Attachment.

BARRY J. SHILLITO.

SECURITIES OWNED BY BARRY J. SHILLITO

1. American Systems, Inc. ( convertible debenture) .

2. General Development Corporation.

3. T. Rowe Price Mutual Fund.

4. Maryland Bridge/Tunnel Bonds.

5. Teachers Insurance and Annuity Association.

6. College Retirement Equities Fund.

7. Say-On Drugs.

The CHAIRMAN. Thank you very much, Mr. Secretary. You will

be coming back to see us.

That brings us, gentlemen, to Gen. George A. Lincoln.

(The nomination of Mr. Shillito to be an Assistant Secretary of

Defense was subsequently approved by the committee in executive

session and confirmed by the Senate on January 29, 1969.)

NOMINATION OF GEN. GEORGE A. LINCOLN TO BE DIRECTOR OF

OFFICE OF EMERGENCY PREPAREDNESS

The CHAIRMAN. Have a seat, General.

Members of the committee, Senator Javits had hoped to be here tc

present General Lincoln to the committee and vouch for him, but he is

detained in another committee meeting and we will express his interest

and his support here for the record and then proceed.

Members of the committee, General Lincoln has been nominated tc

be Director of the Office of Emergency Preparedness. General Lincoln

has recently retired as a professor at the Military Academy at West

Point, where he was head of the Department of Social Science. His

military service includes duty on both General Marshall's and General

Eisenhower's staffs during World War II. He has served in various

advisory capacities to the Department of Defense over the years, as

well as a recent special advisory position to the Administrator of AID.
12

General, we are glad to have you here with us. I had the pleasure of

a chat with you yesterday afternoon. I have looked over the financial

disclosure matter that you presented. In the opinion of the Chairman

and the Chief of Staff, it fully meets the requirements of the committee.

(The nomination reference and biographical sketch of General

Lincoln as well as General Lincoln's letter to the committee follow:)

NOMINATION REFERENCE AND REPORT

IN EXECUTIVE SESSION,

SENATE OF THE UNITED STATES,

January 21 (legislative day, January 10), 1969.

Ordered, That the following nomination be referred to the Committee on

Armed Services:

George A. Lincoln, of Michigan, to be Director of the Office of Emergency

Preparedness.

BIOGRAPHY OF GEORGE A. LINCOLN

I was born on a farm near Harbor Beach, Michigan and attended the University of Wichita, West Point, and Oxford. Upon graduation from the Academy

in 1929, I was commissioned in the Corps of Engineers. Before taking up my

service duties I won a Rhodes scholarship from New York and attended Oxford

where I received a B.A. and M.A. in Economics, Politics, and Philosophy. Upon

returning from England, I served as a company commander at Fort Logan,

Colorado and was in charge of the Civilian Conservation Corps construction in

Colorado. Subsequently, I advanced through grades—including that of Assistant

District Engineer—to Brigadier General in 1945. I have had considerable experience in government and educational circles in the fields of national security,

defense economics and international relations. Early in World War II, I served

as logistical planner for the European Theater and subsequently became head of

the Strategy and Policy Group of the War Department's Operations Division.

serving as General Marshall's, and later, General Eisenhower's planner.

Although in 1947 I relinquished the star of a Brigadier General (the rank

to which I reverted upon retirement) and became a professor at West Point,

and later, head of the Department of Social Science, I continued, when called

upon, to assume planning and operating positions. At various times I served in

positions away from the Academy including Deputy to the Under Secretary of

the Army during the Berlin blockade; to act as representative of the Department

of Defense hi the designing of the Mutual Security Program; and again as

Defense Adviser to the Temporary Council Committee of NATO—in this latter

capacity analyzing and costing the manpower, organizational and equipment

requirements for the defense of Western Europe. I was a full time Special

Adviser to the Administrator of AID for over a year recently and have served

in various part time government consultant capacities including the Arms Control

and Disarmament Agency and CIA.

My concern with preparedness has been expressed in books, articles, and

courses on National Security and Defense Management. I am co-author of "Economics of National Security"—published in 1954—which deals with stockpiling

resource mobilization, industrial preparedness, stabilization of a defense economy and related topics. I am also co-author of "Dynamics of International

Politics," 1962, rev. 1967, "International Politics" (1954) and of "Background

for Our War" (1942), and author of "Strategy of Minerals" and "International

Realities" (1948).

I was married in 1936 to the former Frederica Bellamy of Denver. We have

four children. Our oldest daughter, Frederica, is head of the English Department

of an International School in Teheran, Iran; our son, Captain Daniel Lincoln

commands an Infantry Company of the 25th Division in Viet Nam; and our two

other daughters, Joyce and Lorna, are graduate and undergraduate students

respectively at the University of Michigan and Colorado State University. One

of my brothers is Lt. General L. J. Lincoln, U.S. Army; another James Lincoln

is Judge of the Juvenile Court of Wayne County, Michigan.

My domicile is Michigan, we have homes in Evergreen, Colorado and until

recently West Point. Honors include Distinguished Service Medal, Legion of

Merit with Oak Leaf cluster, Comdr., Order British Empire, and Doctor of Laws

(Hon), University of Pittsburgh, 1968.
13

OFFICE OF EMERGENCY PREPAREDNESS,

EXECUTIVE OFFICE OF THE PRESIDENT,

Washington, D.C., January 27, 1969.

HOU. JOHN STENNIS,

Chairman, Committee on Armed Services,

U.S. Senate,

Washington, D.C.

DEAR MR. CHAIRMAN: In relation to my pending nomination to be Director

of the Office of Emergency Preparedness, this letter sets forth my plans for

the strictest compliance with the so-called conflict of interest statutes and

policies of the Government.

I have retired as a member of the Regular Army.

To avoid any possibility of any conflict of interest or even the appearance of

any such conflict, my wife and I have created a blind trust and have transferred all of our securities to it. The Trustee is the First National Bank of

Denver, Denver, Colorado. In addition, if confirmed, I shall instruct the Trustees

not to purchase any oil stocks during my term of office.

I do not have any membership on Boards of Directors or any employment

relationships other than my status as a retired member of the Regular Army.

I trust that the arrangements described above will be acceptable to the

Committee.

Sincerely,

G. A. LINCOLN, Director-Designate.

Securities owned by George A. Lincoln

( only) : Radio Corporation of America.

Securities owned by George A. and

Frederick B. Lincoln (tenants in common) :

Automatic Sprinkler Corporation of America.

Goodrich, B. F. & Company.

Indian Head, Inc.

Litton Industries, Inc.

Marcor, Inc. Pf.

Olin Mathieson Chemical Corporation.

Scudder Special Fund, Inc.

Sprague Electric Company.

Squibb Beechnut, Inc.

Textron, Inc. Pf.

Securities owned jointly by George A.

and Frederica B. Lincoln (joint tenants) :

Air Reduction Company, Inc.

Allegheny Power System, Inc.

Aluminum, Ltd.

American Telephone & Telegraph Co.

Automatic Sprinkler Corporation of America.

Cluett Peabody, Inc.

Fruehauf Trailer Company.

General Motors Corporation.

Goodrich, B. F. & Company.

Indian Head, Inc.

Ingersoll Rand Company.

Jonathan Logan, Inc.

Marshall Field & Company.

Olin Mathieson Chemical Corporation.

Pan American World Airways, Inc.

Reynolds Metals Company.

Sperry Rand Corporation.

Squibb Beechnut, Inc.

Textron, Inc.

Westinghouse Electric Corporation.

The CHAIRMAN. I would like you to make any statement now that

you wish.
14

STATEMENT OF GEN. GEORGE A. LINCOLN, NOMINEE, TO BE

DIRECTOR OF OFFICE OF EMERGENCY PREPAREDNESS

General LINCOLN. Thank you very much, sir. I have no long formal

statement. I just want to say that I recognize the great importance

of the responsibilities the President has nominated me to undertake,

stemming from membership in the National Security Council, which

as you know is statutory and which President Nixon proposes to use

a great deal, extending from there to my office in connection with

national disaster assistance, which I have found can be quite pressing

in the last few days.

I do very much appreciate Senator Javits' indication of support.

I know that the committee has my biography and I just ask, would

you like me to summarize any of that?

The CHAIRMAN. Yes, you may summarize it briefly. We like to

hear you present these matters.

General LINCOLN. I was born on a farm on the shore of Lake Huron,

in Harbor Beach, Mich. We still own the farm and am very proud

to, because Michigan is my domicile.

I attended the Military Academy and when graduated was commissioned into the Corps of Engineers, went on from there for 3

years to a Rhode's scholarship, which I won from the State of New

York, at Oxford and received my bachelor's and master's degree in

economics, politics, and philosophy from Oxford.

I served in various military assignments in the next few years,

was in charge of construction for the CCC in Colorado started the

Bluestone Dam in West Virginia, was involved in the hundred-year

flood in the Ohio in 1937; taught at West Point; served in two or

three capacities during World War II, and in the latter part of the

war, was General Marshall's chief of plans. Then I was with General

Eisenhower, when he was Chief of Staff, as Chief of Plans. By that

time, I was a brigadier general and decided that I could serve best

by going back to the Military Academy as professor. Professors are

colonels, so I became a colonel. I have been there as professor of

social scien6es for nearly 22 years, however, spending probably a

third of the time on various assignments in Washington, generally

for Government agencies—Department of the Army, Department of

Defense, State Department, White House, and I did spend a year as

special adviser to the Adminsitrator for the Agency for International

Development.

I have written some books, collaborated in writing them, pertaining

to the job that the President has asked me to undertake, and have

just finished nearly 40 years of service in uniform.

I have a connection with New York, obviously. Being fortunate

enough to be married to a charming girl from Denver, I have a

strong connection with the State of Colorado. We have a little ranch

up in the mountains where we are going to live sometime.

The CHAIRMAN. That is a very fine record. We thank you very

much.

You heard my questions, and these are not personal questions, but

why did you come to this position that you propose to fill? Just from

your viewpoint, why would you like to do this?
15

General LINCOLN. I would say there are two clusters of reasons sir.

First, my lifework has been to serve the United States particularly,

in the broad area of national security, not only more narrowly military matters but economic, political, human. And the President asked

me to undertake this responsibility. I have been accustomed by nearly

40 years of service to react immediately to a request from the Commander in Chief as happily as the more junior officers.

The CHAIRMAN. What's your expectation as to how long you expect

to serve?

General LINCOLN. I expect to serve, sir, at the pleasure of the President and I understand that. I am not the youngest person he has

among his immediate advisers, so I would not be surprised if he

thought that I were a little aged after a while.

The CHAIRMAN. We will leave that to him. We just want your attitude. We want someone who is willing to serve as long as he is

satisfactory.

You know our problem here. It is necessary to take testimony and

we like a witness who brings out the facts in frankness and candor

and fullness and feels a responsibility to do that. If you testify here

before us, would that be your purpose?

General LINCOLN. That would be my purpose, sir. I have been

faulted in my career for lack of tact, but rarely for lack of

forthrightness.

The CHAIRMAN. I would not suggest that you lack any of those

things, but we want to be sure we understand each other. Any of those

that are under you that have influence in the Department, you would

encourage them, of course, to have the same attitude?

General LINCOLN. I would so enjoin them, sir.

The CHAIRMAN. I do not think it is up to the committee to have to

cross-examine the witnesses to get the facts.

General LINCOLN. I expect to have the sort of fellows working for

me that would be that way.

The CHAIRMAN. Let me ask you a specific question. This is a dual

office in a way. It has Federal-State relations and duties in connection

with the emergency preparedness as well as general preparedness.

That involves stockpiling. What did you say had been done about the

particular part of it that related to the State Governors' relationship?

General LINCOLN. As I understand, gentlemen, President Nixon

proposes to ask—may I back up?

Currently, or until his departure from the position which the President has asked me to occupy, Gov. Price Daniel has really had two

titles: He has been Director of the Office of Emergency Preparedness

and he has also, by Executive order, been the Special Assistant to the

President for Federal-State Relations.

My understanding is that President Nixon proposes that he will de

facto give this task of Federal-State relations to Vice President

Agnew. That will not mean, however, that my Office is out of the business of State relations, because by statute to some extent, and just by

the nature of our planning and coordinating job, we are still in the

business of Federal-State relations. I doubt that I will be making

many speeches at Governor's conferences. We are rather in the disaster assistance business, plus the business of helping States to plan
16

for continuation of government in the case of a nuclear disaster that

sort of thing.

The CHAIRMAN. I brought that out, because I think it is of interest

to the committee membership, to the Congress and to the public. I am

glad you have your lifelines cleared on that. There is room for each

of them.

General LINCOLN. If I may comment, sir, the President has stated

to me quite firmly that he wants me to put considerable of my personal

time on the National Security Council matters.

The CHAIRMAN. He certainly has the authority to do what I was

observing he would probably do as Vice President.

As I have stated previously, this office carries with it a place on the

National Security Council. General Lincoln will be a member of the

National Security Council.

During the past 2 or 3 years, we have been asked to pass on numerous disposals of commodities from the national and supplemental

stockpile. The committee has a special Subcommitte on Stockpiling,

very ably handled by the Senator from Missouri, Mr. Symington. Just

what is your present thinking on the disposal program of the surplus

material?

General LINCOLN. Really, gentlemen, as I believe you will understand, I have not had enough time to become familiar with the details

of my responsibilities. This is one that in priority, I deliberately did

not put forward for some time, because I believe it was necessary to

learn something about disaster assistance. Sure enough, by the way,

we have had two disasters since Inauguration Day to deal with. So I

am not really able to give you a detailed answer to your question,

except the general comment that I would expect to carry out the law

in accordance with the best of my judgment and ability, and I know

that I have good advisers on my staff. I am sure the committee knows

much better than I that there are surpluses in the stockpile according

to our present planning. I have noted that. My predecessor has been

pressing a 'study, a revision of requirements, item by item, with a

view to coining up to date with our plans. I would expect to continue

this study.

The CHAIRMAN. Concerning the stockpile of copper, we had this

matter up during the calendar year 1965-66, when the President saw

fit to release without the consent of Congress a considerable amount

of copper, about 550,000 tons, I believe, thus bringing the amount in

the stockpile considerably below the objectives. The objectives up

to that time had been 775,000 tons, and on hand after that disposal

was left only 259,000 tons.

What is your present assessment as to the copper situation?

General LiNcoLN. I am really unable to give you an adequate anwser

to your question, Mr. Chairman. Of course, my assessment is the obvious one that is in your mind, that copper is one of the few items in

the stockpile in which we are currently deficient. I think in the quick

briefing paper I read, we are deficient in only seven items. Copper is

one, and I noticed this right away and noticed that we were materially

deficient. I have not taken the next step forward, which is to ask what

we might be able to do about it. That is going to be my next step.

The CHAIRMAN. We want you to promise that you will immediately

get into this matter, as soon as you reasonably can. We have never
17

passed a law requiring the consent of Congress about these matters,

but we do think that we ought to be consulted.

Do you think so?

General LINCOLN. I certainly do. I did before you spoke, Mr. Chairman, and I have had my view reinforced.

The CHAIRMAN. We go now quite briefly to the question of nickel,

which is very important, of course. If you are prepared to give something on that now, an estimate, an assessment of the situation, I lust

remind you that in January 1967, this committee refused to act on a

bill to further reduce our nickel stockpile in the belief that the stockpile then was already rather low.

At this time, do you wish to comment on that?

General LINCOLN. At this time, I do not wish to comment, sir; because, as I have indicated, nickel is one of the many things that I have

not looked into.

The CHAIRMAN. You have the same idea, though, about the seriousness of it and the immediacy of attention as you do copper?

General LINCOLN. I do. May I say that I have been interested and

I have understood the importance of strategic minerals for at least 30

years; in fact, started writing on the subject about that long ago, when

I had no idea I would be in this position.

The CHAIRMAN. That is very fine, and you intend to keep in touch

with the committees of the Congress with reference to that subject,

too?

General LINCOLN. I certainly will, sir.

The CHAIRMAN. I will call Senator Symington's attention to your

purposes in that field. Obviously, there is not time, but I feel a lot of

the questions I have are more for the committee than they are for you.

Senator Brooke?

Senator BROOKE. General, you refer in your letter to the creation

of a blind trust, in which you put some stocks that are jointly held

by you and your wife, held commonly by you and your wife. Then

you refer to the fact that if confirmed, you would instruct the trustee,

which is a corporate trustee, not to purchase any oil stocks. How much

control will you have over this trustee?

General LINCOLN. None, as I understand.

Senator BROOKE. How would you be in a position to instruct the

trustee what to purchase and what not to purchase?

General LINCOLN. I get your point, which is a good legal point, a

sound legal point. But I am willing to state with a considerable amount

of confidence that if I tell the trustee not to buy oil stocks, he will not

buy it. The First National Bank is, as a matter of fact, the family bank

of Mrs. Lincoln's family. They would honor a request of this nature.

Senator BROOKE. All right. I certainly do not intend to impugn

anything that you mean to do. On the other hand, Mr. Lincoln, if you

could tell him what not to buy, you could tell him what to buy. Would

the trustee act the same way?

General LINCOLN. I also see your point, but these people would not

do it.

Now, if it would make you or the committee feel any better, we can

add a codicil to this and say no oil stock.

Senator BROOKE. Have the trusts already been drawn, the instruments themselves?
18

General LINCOLN. The instrument was presumably signed by the

'bank and Mrs. Lincoln, who has been in Denver, on Friday, and it was

mailed to me and the U.S. mails have not gotten it here yet. But if you

do desire a codicil, we can add it very readily.

Senator BROOKE. IS it your intention to submit a copy of the instrument to the committee?

General LINCOLN. The committee staff already has the instrument.

Senator BROOKE. We have a copy of the instrument?

The CHAIRMAN. Yes. And we will have copies of the trust, too, in

the files. We do not put those in the record.

Senator BROOKE. Mr. Chairman, could you pass me until I have

an opportunity to look through the trust, then?

The CHAIRMAN. All right.

Senator Young?

Senator YOUNG of Ohio. I have no questions.

The CHAIRMAN. Senator Goldwater?

Senator GOLDWATER. Mr. Chairman, I think we are very fortunate

to have the continued service of this man, who has contributed his life

to the service of his country. I am proud to support him.

The CHAIRMAN. Senator Byrd?

Senator BYRD, JR. of Virginia. I think the appointment is an excellent one, Mr. Chairman. I congratulate the President and the

appointee.

I am inclined to agree with the Senator from Massachusetts that

it might be well to add a codicil to the agreement directing the bank

not to buy oil stocks.

General LINCOLN. We will so do.

The CHAIRMAN. Thank you, Senator.

Senator Schweiker ?

Senator SCHWEIKER. Thank you, Mr. Chairman. I have no questions.

i am delighted to support him.

The CHAIRMAN. Thank you, sir. Are there any further questions?

Senator BROOKE. I have no further questions at this time, Mr.

Chairman.

The CHAIRMAN. General, do you wish to say anything else?

General LINCOLN. No further statement, sir.

The CHAIRMAN. If it is the pleasure of the committee when this is

concluded with General Lincoln, we will go into executive session to

consider the nominations we have heard today and those we heard last

week, and such other matters as the membership may want to bring

up. I was thinking that probably this meeting would serve the purpose of t he Thursday meeting in that this early in the session, there are

not many other matters except nominations to be disposed of. We hope

to get hearings started on procurement just as soon as we can. Personally, I think if we wait to have hearings until they have completely

revised or brought in any revisions that Secretary Laird and the

President see fit to make, it will be well along in the session, and since

there is so much of it that will not be substantially changed I believe

we will make headway to start hearings in the near future. Secretary

Laird can make such revisions later. I have talked to him about it and

he feels that way, too. It is the only way we can give this matter extended consideration and I think it ought to be extended this year

because we are in a changing position with reference to a good many

weapons.
19

Senator Smith, this is General Lincoln. I believe you have had a

chance to look into this matter. Do you have some questions? I have

asked him the questions that are ordinarily asked and the others have,

too. It seems his disclosures are adequate as to his conflict of interest

possibilities.

Senator SMITH. Mr. Chairman, I have known General Lincoln.

General Lincoln, I apologize for not being here. I was fortunate

enough to be called to the White House for a leadership meeting. I

thought I would get here earlier.

Mr. Chairman in the interest of time, I feel that these questions

could be answered for the record just as well, and then I shall not be

duplicating anything that was said. I would request that my questions

be placed in the record and ask General Lincoln to answer them for

the record. Then there will not be any misunderstanding.

The CHAIRMAN. Thank you, Senator Smith. You have your usual

preparation right here. We will ask the general to submit these answers as soon as he can, so that the record may be printed right away.

Senator SMITH. I think, Mr. Chairman, that he can answer these

perhaps before he leaves and that will give us time to work in executive

session.

The CHAIRMAN. If he will do that, that will be very fine indeed.

Senator Sm.-rm. What is the function and authority of your office

with respect to quota allocations on oil imports?

It has been the policy of all administrations, Democrat or Republi-

.can, back through the Franklin D. Roosevelt administration to foster

policies aimed ultimately at free trade. This pro-free trade policy has

been destroying and continues to destroy industries in Maine and New

England like the textile and shoe industries—the end result being

literally the exporting of the jobs of American textile and shoe

workers to Japan and Italy and other nations. It is literally an antiprotectionist policy that is exporting jobs.

Yet, on the other hand, Republican and Democratic administrations

alike have had a diametrically opposed policy of great protectionism

for the domestic oil industry. This oil protectionist policy that places

drastic restrictions on oil imports results in making Maine and New

England literally a captive market of the protected domestic oil industry—and the usual pattern is for the oil companies to inflict a price

gouge on the people of Maine and New England in the coldest time of

the year and when the people can't do anything about it. For example,

the displaced and unprotected Maine textile worker is forced to pay

exorbitant fuel oil prices in order to survive because of the protectionist restrictions on the import of foreign produced oil.

This unfair condition has repeatedly been protested by New England

Senators and Representatives—even John F. Kennedy when he was a

Massachusetts Senator—to Presidents Eisenhower, Kennedy and Johnson to no avail and they seemed to have deaf ears to our pleas.

The deafness seems to have been most solid in the closing months of

the Johnson administration in the failure of the Secretary of Commerce and the Secretary of Interior to take action on a proposal that

would bring relief from fuel oil price gouging through what is known

as the Machiasport project. I am sure that you are fully aware of this

project. I would hope that the Nixon administration would show a

greater understanding and appreciation of our situation in New Eng-
20

land in which we suffer greatly so that the oil rich States may gain

through protectionism policies—and I would hope that the Nixon administration would not be guilty of the delaying tactics and procrastination of the Johnson administration on the Machiasport project.

Now I want to ask you for your views and comments on what I have

been talking about.

(General Lincoln's answers follow:)

REPLIES TO SENATOR SMITH'S QUESTIONS

Senator SMITH. What is the function and authority of your office with respect

to quota allocations on oil imports?

General LINCOLN. Our responsibility regarding the oil import control program

is based on the authority of Section 232 of the Trade Expansion Act of 1966

(originally Section 8 of the Trade Agreements Extension Act of 1958), under

which the oil program was established on March 10, 1959 by Presidential Proclamation No. 3279. The Proclamation was issued following a finding of the Director

of this Agency that crude oil and its principal products and derivatives were being

imported in such quantities and under such circumstances as to threaten to

endanger the national security. Our surveillance obligations are outlined in Sec.

6(a) of the Proclamation. These are particularly concerned with program changes

and consequences related to the national security. We are vitally concerned in

structural and overall quantitative changes in the program. However, we have

no responsibility for determining individual oil import quota allocations.

Senator SMITH. It has been the policy of all administrations, Democrat or

Republican, back through the Franklin D. Roosevelt Administration to foster

policies aimed ultimately at free trade. This pro-free trade policy has been destroying and continues to destroy industries in Maine and New England like the

textile and shoe industries—the end result being literally the exporting of the :jobs

of American textile and shoe workers to Japan and Italy and other nations. It is

literally an anti-protectionist policy that is exporting jobs. Yet, on the other

hand, Republican and Democratic administrations alike have had a diametrically

opposed policy of great protectionism for the domestic oil industry. This oil protectionist policy that places drastic restrictions on oil imports results in making

Maine and New England literally a captive market of the protected domestic oil

industry—and the usual pattern is for the oil companies to inflict a price gouge

on the people of Maine and New England in the coldest time of the year and

when the people c-,n't do anything about it.

For example the displaced and unprotected Maine textile worker is forced to

pay exorbitant fuel oil prices in order to survive because of the protectionist restrictions on the impott of foreign produced oil. This unfair condition has repeatedly been protested by New England Senators and Representatives—even

John F. Kennedy when he was a Massachusetts Senator—to Presidents Eisenhower, Kennedy and Johnson to no avail and they seemed to have deaf ears to

our pleas. The deafness seems to have been most solid in the closing months of

the Johnson Administration in the failure of the Secretary of Commerce and the

Secretary of the Interior to take action on a proposal that would bring relief

from fuel oil price gouging through what is known as the Machiasport project.

I am sure that you are fully aware of this project. I would hope that the Nixon

Administration would show a greater understanding and appreciation of our

situation in New England in which we suffer greatly so that the oil rich states

may gain through protectionism policies—and I would hope that the Nixon

Administration would not be guilty of the delay-tactics and procrastination of

the Johnson Administration on the Machiasport project.

Now I want to ask you for your views and comments on what I have been

talking about.

General LINCOLN. The Machiasport issue is now before the Foreign Trade

Zone Board and it would be inappropriate for me to comment while that matter

is pending. We will carry out any responsibilities of this office incident to the

decision of that Board.
21

The CHAIRMAN. Senator Cannon, we are glad you were able to get

here. This is General Lincoln who has been appointed to the Office of

Emergency Preparedness, and will be a member of the National Security Council. He is successor to Gov. Price Daniel. This identifies his

operations. He retired from the Army a few days ago. The usual

questions have been asked him. There seems to be no problem of conflict

of interest. He has a trust agreement, a blind trust, so-called, and he

has agreed to put another blinder on it.

Senator CANNON. I have no questions, Mr. Chairman.

The CHAIRMAN. He is going to be detained here a little while anyway, Senator. If you think of anything, I know he will be glad to

answer.

General, with the thanks of the committee, you are excused.

The committee will take a 1 minute recess and go into executive

session.

(Whereupon, at 11 a.m., the committee went into executive session.)

(The nomination of General Lincoln to be Director of the Office of

Emergency Preparedness was subsequently approved by the committee

in executive session and confirmed by the Senate on January 29, 1969.)

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