1950 If the action of the committee is re- versed, the farmers of Montana, who will be the purchasers of the power sup- piled, will pay every nickel of the costs of the line, and the Government will not lose one cent, At the same time, the Montana Power Co. will not lose anything, either. As a result of the great power development in Montana, it stands to make fabulous profits. This seems evident from the way in which the price of its stocks and securities ig jumping up itn Wall Street, as I men- tioned a few minutes ago. A further matter to consider is the fact that if the Havre-Shelby line were not completed, and the Government were compelled to sell all its Fort Peck power to the Montana Power Co. at the dump rate of 2.5 mills, the Government would lose annually over a quarter of a million dollars. Without the Havre-~ Shelby line, it would be deprived of a profit of 3 mills on every kilowatt of power it wouid be able to sell to the REA’s over that line, all of which would go to pay for the cost of the Fort Peck Project and transmission lines and pro- vide for other reclamation projects. Who will profit by such arrangement? The Montana Power Co. will get the dif- ferential between the dump rate and the firm rate for merely providing trans- mission service to the cooperatives’ load centers. It is hard to believe that the Senate would ever condone such a stag- gering loss to the Federal Treasury in order to provide a profit to private interests. I might add that, should the company be in the position of being the sole source of supply to the cooperatives, there would be no assurance that the company would provide capacity in its facilities to meet the load requirements, even though it has recently raised the voltage of cer- tain sections of its line. I make this point since I have been informed that the Hill County Cooperative has dis- cussed with the Bureau of Reclamation the possibility of temporarily using the Havre-Shelby line before the substations are complete, to assist in meeting its peak loads this winter, which cannot be provided for by the facilities of the Mon- tana Power Co. Furthermore, Mr. President, if the Havre-Shelby line is not completed, and if the Government is required to sell whatever facilities it has completed, the private power company will have a monopoly, as I have previously stated on several occasions. In addition, if the private power com- pany is the sole source of supply of elec- tricity, there is no assurance that it will not raise {ts rates at a later period of ime. Mr, President, I realize how difficult it is to thrash this matter out on the floor with only a few Senators present. It requires the most careful attention. It seems to me that this matter could be handled more effectively in the confer- ence committee, as has been suggested by the distinguished Senator from Ari- zona, who is handling this portion of the appropriations bill. I understand that it is the purpose of the Senator from Arizona to have this matter fully con- sidered by the conference committee. CONGRESSIONAL RECORD—SENATE Mr, HAYDEN. That is my desire; and I am quite sure that when we reach the conference we shall have definits infor- mation down to date from both the Reclamation Service and the Montana Power & Light Co. in regard to this situation. Mr. MURRAY. I am glad to know that the Senator from Arizona agrees with me about this matter. This is a most unusual situation. In view of all that the able Senator from Arizona has said, and in view of the facts developed in the Recorp here today, this matter should be given the most thorough and careful consideration by the conferees on this bill, with the result that the Con- gress will be prevented from making a serious blunder, costly to the Govern- ment, and at the same time will protect the farmers of Montana from a grave in- justice by the destruction of this line after it has been almost completed. Mr. President, the other item which is affected by this matter is the Canyon Ferry-Great Falls transmission line. Mr. HAYDEN. Let me state briefly what the committee has done in that regard: The committee concurs with the House in omitting the foregoing transmission lines and substations from the bill. In addition, the committee recom- mends that $365,000 included in the 1951 budget estimate and allowed by the House for the Canyon Ferry-Great Falls 115-kilovolt transmission line and sub- stations be deleted. The committee ex- pects the Reclamation Bureau and the Montana Power Co. to negotiate, giving appropriate weight to the distances in- volved, a wheeling agreement for the dis- posal of Canyon Ferry power. If the facts show next year that the company has not acted in good faith, the commit- tee will be willing to recommend appro- priations for the construction of these facilities. The Montana Power Co has given assurances that it will build the Canyon Ferry-East Helena section of the Canyon Ferry-Great Falls line and will include the right to use this line in the agreement being negotiated with the Reclamation Bureau for the use of the company’s two existing 100,000-volt lines between Great Falls and East Helena. Again that is a matter which we shall take to conference. It is involved in the total amount to which this item relates. I can assure the Senator from Mon- tana that if a proper wheeling agree- ment of that kind is not made, he will not have to make any argument with me. On the other hand, if one is made, and if it is made tn a manner which is satis- factory to the Bureau of Reclamation— and from what I could learn from the Chief Engineer of the Bureau of Recla- mation, the negotiations are now in progress, and those in the Bureau be- lieve they will be fully satisfied with the agreement—then I understand that the Senator from Montana himself will be satisfied. Mr. MURRAY. Yes. If the trans- mission line is not carried through as proposed in connection with the appro- priations, there should be a wheeling agreement which will prevent the Mon- tana Power Co. from having a monopoly 10601 of the power from the Canyon Ferry project. Mr. HAYDEN. That js distinctly un- derstood by everyone, and we shall do our best to find out about it. I hope that at the time when we take up this item in the conference, we can dispose of both of these matters in that way. If it can be handled in the way it was handled in the case of the South- western Power Administration and be- tween the Montana Power Co. and the Bonneville Power Administration in reference to power from Hungry Horse Dam, and it can be handled in a way that is fair to both the company and the Government, I hope that will be done. Mr. MURRAY. Yes. I should like to Point out that the action of the Senate committee in eliminating funds for initiating construction of the Canyon Ferry-Great Falls transmission line and substations will have a serious effect on the Canyon Ferry unit of the Missouri Basin project. This unit includes the Canyon Ferry Dam and power plant of 50,000 kilowatts capacity, capable of producing over one-quarter billion kilo- watt-hours of salable energy annually. Senators no doubt will recall the ac- tion taken by the Congress several years ago when a restrictive provision barring the installation of generating facilities at Canyon Ferry power plant was con- tained in the Appropriation Act. It was pointed out last year that this would have a serious effect on the repayment ability of this unit, which should be a heavy contributor toward the repayment of the Missouri River Basin development. The Congress removed this restriction last year after it realized the serious im- plications involved in eliminating the power-generating facilities. The elimination of the Canyon Ferry- Great Falls transmission line is of equally serious import. This line is the outlet for power to be produced at Can- yon Ferry power plant and will inter- connect with the Fort Peck project sys- tem at Great Falls, Mont. Should the committee's action be sustained, and the Canyon Ferry-Great Falls line be elimi- nated from the program of the Bureau of Reclamation, the Montana Power Co. then will be placed in the position of be- ing the only customer or outlet for power to be produced at the Canyon Ferry power plant—unless, as the Senator from Arizona has pointed out, a satis- factory wheeling agreement is reached. Mr. HAYDEN. That is thoroughly understood by all concerned, I assure the Senator. Mr. MURRAY. Myr. President, with the understanding that this entire mat- ter is going to be considered by the con- ferees, it seems to me it is not necessary for me to go much further into this question, If the company is not willing to lease a portion of its facilities to permit the Bureau of Reclamation to utilize these facilities to integrate its operations with the Fort Peck system and thus provide an outlet for the power there produced, it is obvious that the Government will realize a serious loss in revenue. Under the proposal of the committee, the
10602 Montana Power Co. will construct a seg- ment of line from its East Helena sub- station to the Canyon Ferry bus bar. This will place the company in a posi- tion to monopolize the entire output of the project. Should the company refuse to lease its facilities at a reason- able cost, the only alternative would be to sell the entire output to the company or deliver power over its system under a wheeling agreement. The wheeling agreement would be entirely unsatisfac- tory, since it would not permit the free integration of energy with the Fort Peck project system, and the annual cost of wheeling one-quarter of a billion kilo- watt-hours would be prohibitive unless such costs were merely nominal or were equivalent to a license for the full use of its line capacity. The other alternative is even more se- rious. As stated previously, the Mon- tana Power Co. has with the Bonneville Power Administration a firm power con- tract whereby the company will receive 50,000 kilowatts, delivered at Anaconda, at an average rate of approximately 25 mills. The rate for firm power from the Missouri Basin project is 55 mills per kilowatt-hour, or a differential of 3 mills per kilowatt-hour between the Bonneville rate and the Missouri Basin rate. The company, being in a position to monopolize the output, would be in a good position to demand an equivalent rate for Canyon Ferry power. If the company should take such a position— and it appears quite certain that it will—the total anticipated revenue from the Canyon Ferry project would be ap- proximately $600,000 annually. The op- erating costs and provision for replace- ment would require approximately $190,- 000 annually leaving a net of $410,000 annually available for interest and amortization. Let us analyze the situation further. The tentative allocation of cost to be repaid from power revenues for the Can- yon Ferry unit is approximately $18,- 200,000. The interest alone for 1 year on this amount at 3 percent would be $546,090, leaving a net loss of $136,000 annually to the project, without con- sidering repayment of the original in- vestment By not approving funds for the construction of the necessary trans- mission facilities to provide an outlet for power, the Congress manifestly places the Government in such a posi- tion that it cannot seek the best ar- rangement for disposing of Canyon Ferry power at the established Missouri Basin rate. If such action is sustained by the Con- gress, it will in effect, be placing the Bureau of Reclamation in such a posi- tion that it cannot carry out the provi- sions of reclamation law requiring repay- ment under stipulated conditions. Here, again, Congress, by refusing to appro- priate a relatively small amount of money to provide these necessary facili- ties, will be placing the Government in 8 position to continually lose, year after year, part of the interest on its original investment, and also will deny it any means of returning the investment itself. I think it would be proper to characterize this as a fraud on the United States Government, It is certainly contrary to CONGRESSIONAL RECORD—SENATE the national policy and the intent of Congress that the expenditure of public funds should be made for the sole and exclusive profit of an individual corpo- ration. This is especially true when the returns from such investments as recla- mation projects are for the development of the West. The most widespread ben- efit and use of the projects’ products, both irrigation and power, are a part of that national policy. Upon careful consideration of this matter, the conclusion is inevitable that the funds should be restored for the con- struction of the necessary facilities to provide an outlet for Canyon Ferry power in order to place the Bureau in the best position to bargain with the Montana Power Co. for the most satis- factory arrangements to dispose of Can- yon Ferry power in keeping with recla- mation law. Mr. President, I think this matter cannot be fully and effectively handled on the floor with only a few Senators here. This, again, is & matter which requires careful study by the conference committee when the measure goes to conference. I should like to ask the able Senator in charge of the measure if he does not agree with me in these obser- vations. This is a matter which has very serious implications, and I am sure that no one would want to see the Government de- frauded or imposed upon as a result of any oversight or neglect or failure to give the questions involved the fullest consid- eration. Again I should like to ask the Senator from Arizona if it is his intention to have these matters—both the Havre-Shelley problem and the other problem—worked out with proper agreements which will not give the Montana Power Co the entire advantage and will not destroy the efforts of the farmers to obtain low- cost power on their farms in Montana? Mr. HAYDEN, That will be our effort, I am sure. Mr. LANGER. Mr President, will the Senator yield at this point, to permit me to insert in the Recorp some matters in connection with this item? The PRESIDING OFFICER (Mr. PEp- PER in the chair). Does the Senator from Arizona yield to the Scnator from North Dakota? Mr. HAYDEN. Mr. President, I had promised to yield for a moment to the Senator's colleague, the junior Senator from North Dakota [Mr. Youna], to per- mit him to discuss a matter relating to this portion of the bill. Therefore, I now yield to the junior Senator from North Dakota. Mr. YOUNG Mr. President, in the report of the Committee on Appropria- tions on the general appropriation bill, 1951, the following appears on page 150: JAMESTOWN UNIT, MISSOURI-SOURIS DIVISION, MONTANA-SOUTH DAKOTA The 1951 budget estimate for this project under phase B (planning) is $105,000. In view of the recent devastating ficods in this area, the committee recommends that con- struction work on the Jamestown project be started at the earliest possible date. The committee, therefore, has approved the transfer of this project from phase B to phase A (construction) and recommends JULY* 19 that the appropriation be increased from the House allowance of $105,000 to a total of $750,000. Mr. President, I should like to make a statement to the chairman of the sub- committee dealing with Interior Depart- ment appropriations and I wish to ask whether he agrees with it: In order that the record may be clear as to the intent of the Senate, it is my understanding that the Bureau of Recla- mation is to proceed at the earliest possible date to construct the James- town Dam for flood protection and, be- cause of the urgency of providing this protection for life and property in the city of Jamestown, the Secretary of the Interior should make appropriate allo- cations of th2 costs to flocd control and other nonreimbursable purposes. The costs of space in the reservoir are to be allocated to irrigation and municipal water supply, to be reimbursable under centracts to be negotiated; but construc- tion of the flood-control features shall not await the completion of these con- tracts. Mr. HAYDEN. Mr. President, my an- swer to the question is yes, because the committee held very careful and exten- sive hearings on this question. The situ- ation is desperate, and requires prompt action; and the only manner in which it can be properly handled is by means of the action proposed by the Senate com- mittee. Mr. YOUNG. I thank the distin- guished Senator, Mr. LANGER. Mr President, will the Senator yield to me at this time? Mr. HAYDEN I yield. Mr. LANGER. Let me say that I join my colleague in regard to the Jamestown Dam. In addition, I have received telegrams and letters relative to the Havre-Shelby line. I should like to read those com- munications into the Recorp, if the Sen- ator from Arizona will permit me to do so at this time. Mr. HAYDEN. Certainly. Mr. LANGER. The following tele- gram has come to me from Medicine Lake, Mont., under date of July 7: MEDICINE LAKE, MONT, July 7, 1950. WILLIAM LANGER, North Dakota United States Senator: At special meeting July 6, 1950, board of trustees passed resolution to the effect that funds be allowed for completion of Havre-~ Shelby Bureau of Reclamation transmission line. Board definitely against Montana Power Co buying Bureau line. Transmission lMnes are vital link in serving REA Co-ops. Mon- tana Power always been hostile Urge your support of funds to complete Havre-Shelby transmission line. Urge Montana Power Co. be stopped from buying Havre-Shelby line and retarding progress of REA Co-ops. Mon- tana Power would like to control power source and in position to dictate to REA Co-ops Suerman County Execrric Co-op, Inc, I have also received the following let- ter: HUNTLEY, Mont., July 5, 1950, Hon. Wirirram Lancer, United States Senate, Washington, D C. Deak Senator LANGER’ J sincerely hope the Appropriations Committee approves suffi- cient funds for the completion of the Havre- Shelby (Mont.) transmission line, This,
1950 and other like projects, must remain in public ownership if our REA cooperatives are to get power at lowest possible cost. Very respectfully, Prato PICKENS. In addition, I have received the fol- lowing telegram: Inverness, Mont., July 3, 1950. Senator Wituiam LanoEr: Government control and ownership of the Havre-Shelby transmission line is necessary for the existence of our electric co-op. We ask your support to obtain additional funds to complete the line. Mr. and Mrs, Emr. Strovix. Mr, and Mrs. BERNARD Srrovix. Mr. and Mrs. Howarp HALL. I also have a letter from Pendroy, Mont,, dated July 7, which reads as follows: Penpror, Monrt., July 7, 1950. Drag Senator Lancer: I am insisting that sufficient funds be appropriated for com-~ pletion of the Havre-Shelby project of the REA. I think everything should be done to keep REA throughout the Nation every home in the United States of America should have the benefit of electricity and how else will they get it, unless there is a REA. The big companies never worried about farm homes until REA came along. I want to say, Mr. President, that that is true. At the time I was governor of my own State I could not even get a little line built to the farm home in which my sister lived. It took 7 years to get it, and the price was the great sum of $1,300, merely for putting in five posts and the wire. If a sister of the governor of the State could not get electrical serv- ice, Senators can imagine what chance the average farmer has of getting it. The situation there is disgraceful. The letter continues: They never put electricity in the farm homes that their lines passed by. So see that the REA has sufficient funds to continue their good work. That is in connection with the Havre- Shelby project. I have a telegram from Havre, Mont., reading as follows: Senator WrLtaM Langer, Senate Office Butiding, Washington, D. C.: Urge sufficient appropriations to complete Havre-Shelby transmission lines. Corronwoop Farmers UNION, Locau 145, H. J. Hansen, Legislative Chairman. I have another letter, from Circle, Mont., dated July 5, 1960, reading as follows: Deas Senator LANGER: I am sending you my protest against the Montana Power Co. own- ing our electrical tranemisasion lines. I fully endorse and ask our representatives to help forward the Havre-Shelby and public trans- mission lines, My neighbors and fellow citizens of this part of the State are of the same opinion. Trusting you will give your fullest coop- eration in this project, I am Yours respectfully, Wa.sam Gase, I have another letter, Mr, President, also from Montana, from the Park County Trades and Labor Council, Liv« CONGRESSIONAL RECORD—SENATE ingston, Mont., under date of July 8, 1950. It reads: Deax Serwaron: The action of the Senate Appropriations Committee in failing to pro- vide funds for completion of Havre-Shelby, Mont., transmission lines project; and the Montana Power Co. offering to buy up the Government’s obligations was a terrific shock to all members of our council. Every one of you Senators remember how the private power companies insisted upon the Government allowing them to bulld dams, handle the transmission lines; and that they would provide the power necessary, for op- eration of all plants in the United States. You well remember, that if the Govern- ment had heeded their requests we would have lost the last war, as there was and still is a shortage of cheap power; not alone in the Western States; but in the Middle West and New England States. Instead of curtailing Government dams and power transmission lines, our council feel that we may be on the verge of world war IIT and the Government should imme- diately hasten the construction of more power dams and transmission lines; so that, if war does come, we \.111 not be unprepared. Therefore the council in regular meeting July 8, instructed me to request your assist- ance upon the floor of the Senate to see that ample funds are provided for completion of the Havre-Shelby transmission lines; but that you do everything within your power to speed up the construction of all construc- tion work on all dams and transmission lines. Sincerely yours, W. J. Prmst, Secretary, Par] County Trades and Lavor Council. This trades and labor council is made up of the affiliated unions of bakers, bar- bers, bartenders, boilermakers, carpen- ters, clerks, retail culinary workers, elec- tricians, firefighters, firemen and oilers, hodcarriers, building and general labor- ers, lathers, laundry workers, machinists, musictans, painters, operative engineers, plasterers and cement finishers, plumb- ers, sheet metal workers, State, county and municipal employees, and teamsters. Cooperating, not affiliated: Blacksmiths, carmen, clerks, railway conductors, rail- way engineers, locomotive firemen and enginemen, letter carriers, trainmen, railway, and typographical. Mr. President, I have another telegram which is from the Mayor of the city of Havre, Mont., dated July 5, which reads as follows: Havre, Mont., July 5, 1950. Senator Wi11AM LANGER, Senate Building, Washington, D. C.: Request you establish funds for the Bu- reau of Reclamation to complete and operate the Havre-Shelby transmission lines. This line necessary to progress of north central Montana and bureau operation necessary in order to insure low rate of rural electric oo- operative and other public bodies who need low cost power. Please keep faith with the people of Montana who need low-cost power for development of this area. Hasry Sopersena, Mayor, City of Havre, Mont. Mr. President, I took up with the De- partment of the Interior, through the Bureau of Reclamation, every one of these communications. I have here a letter dated July 13, 1960, which I desire to read into the Recorp. It is signed by the Acting Commissioner, and reads as follows: My Dean Sewaron Lanom: Reference is made to your letter of July 10, advising that the board of trustees, Sheridan County Eleo- 10603 tric Cooperative, Inc., Medicine Lake, Mont., has passed a resolution urging that funds be allowed for completion of the Havre-Shelby Bureau of Reclamation transmission line. I call this particularly to the atten- tion of the members of this committee: As of July 10, 1950, 1014 miles of this trans- mission line had been completed and prac- tically all material required for its construc- tion has been delivered on the site The contractor’s schedule calla for completion on Beptember 6, 1950. Mr. President, that is a matter of but 6 weeks from now. In 6 weeks it is going to be done, if it is not stopped by the Congress. The letter continues: However, it is with deep regret that I inform you that the Senate Appropriations Committee has not only failed to provide funds for fiscal year 1951 for the completion of this line but also has stipulated that any money not obligated out of 1950 appropria- tion be returned to the Treasury. This action by the Senate Appropriations Committee, if sustained by the Congress, would prohibit the completion of the Havre- Shelby Transmission Line by the Bureau of Reclamation and would be a very serious blow to the cooperatives who are relying on the completion of this line to meet their power requirements. He says, Mr. President, that it would be a very serious blow. Then he goes on to say: Furthermore, if the Bureau of Reclama- tion cannot complete these facilities 1t will result in a direct loss to the Government of from 6600,000 to $1,000,000 as a result of having to terminate construction and material contracts already in force In ad- dition, if the Havre-Shelby line is not con- structed by the Government the Fort Peck project will lose a princtpal outlet for firm power. This may well result in requiring the project to sell firm power which has a vatue of 5.5 mills per kilowatt-hour at a rate for dump energy, or 2.5 mills, a loss of 3 mills. After the load has been built up over a period of 10 years, it will result in an esti- mated annual loss of almost $260,000. If construction is permitted to proceed— For which my distinguished friend from Montana has so eloquently argued— If construction is permitted to proceed repayment of the costs of these facilities are assured. I say to my friend from Montana, how are we saving one single penny? It is said that we are saving a million dollars when, as a matter of fact, the Bureau of Reclamation says: If construction is permitted to proceed repayment of the costs of these facilities are assured. The original repayment studies indicated pay-out with an investment of @2,800,000, which has now been reduced to $1,095,000, as a result of very favorable bids. The Government's investment will be amply protected under these circumstances, Sincerely yours, EXENNETH MARKWELL, Acting Commissioner, Mr, President, I submit that here is a project which will be completed by Sep- tember 6, approximately 6 weeks. Cer- tainly Congress ought to be jealous of the fact that by previous action it has authorized its construction. It has led thousands of farmers to believe that REA would control the transmission line. We have spent millions of dollars to build the Fort Peck project, and certainly every taxpayer in the country, whether
10604 he lives in Montana or in some other State, ought to be anxious to see to it that no single outfit, such as the Mon- tana Power Co. or any other, should have a monopoly on that power, Cer- tainly after the Government has spent all this money to build the dam, we should spend more moncy to build a transmission line to get the power to the farmers, because that, in essence, is the entire REA program. I yleld the floor. Mr. MURRAY. Mr. President, I ask unanimous consent to have inserted in the Recorp a group of telegrams which I have received from persons in Mon- tana, The first telegram is from the Governor of Montans, which reads as follows: HELENA, MONT, July 14, 1950. Hon James E Murray, United States Senate, Washington,DC: I sincerely hope you are successful in your fight for the restoration of the Shelby-Havre transmission line before the United States Senate. I was keenly disappointed that the Appropriations Committee eliminated this line because it is of vital necessity to the people of this State. We need this line if Montana is to prosper and I feel so deeply about it that I made a State radio address the day before yesterday urging the people to whe you urging that the Senate restore the appropriations for the line. The re- sponse which I have received hecause of the radio address has been most gratifying and I assume that you have 1ecelved many tele- grams of tne same nature, Best wishes for your success in this most worthy endeavor. Regards. Joun W. Bonner, Governor of Montana. Mr. President, I ask that the other telegrams which I hand to the official reporter may be printed in the Recorp at this point. There being no objection, the tele- grams were ordered to be printed in the ReEcorp, as follows: Great Farus, Mont, July 12, 1950. Senator JaMEs E. Murnray, Washington, D. C.; Urge you to use all your influence to secure funds for completion of Havre-Shelby and Canyon Ferry transmission lines. This plea comes from more than 300 farm families and REA patrons meeting in Great Falls tonight whose welfare is &t stake We demand an end to the exorbitant power rates now levied by a private power company that takes Gav- ernment power from Fort Peck at a low rate and sells to our rural electric cooperatives. Give us a chance to live decently with low- cost power and lights on our farms, Cascapr County Farmers UNION, Frep NicHOLson, Jr., Secretary. GREAT Fas, MonT., July 15, 1950. Senator James E Murray, Washington, D. C.: Saving the Havre-Shelby and Canyon Ferry Government power tranemission lines 1s vitally important to thousands of farm fami- lies in northern and central Montana who are dependent on rural electric cooperatives for their power and lights, These Montana peo- ple need low-cost power to enable them to stay on their farma and live decently, They also need low-cost power to make their coop- eratives pay out. As taxpayers they are en- titled to access to Government energy avail- able at Fort Peck and Canyon Ferry on an equal basis with other power users, and that means freedom from exorbitant middleman Charges by private power companies, The CONGRESSIONAL RECORD—SENATE Havre-Shelby transmission line is a self- liquidating project designed to bring cheap Fort Peck power to the people in northern Montana. Destroying that Government pow- er line will put the people in the area at the mercy of the Montana Power Oo. in the years ahead. The announced reduction in rates by the company carries retarding conditions that more than offsct the announced im- provement in costs and forectloses on further advantages for the people now demonstrated by the Bonneville Power Administration and TVA. The Canyon Ferry line will firm up farm power in central Montana and bring the same benefits for patrons of rural electric co-ops as the Havre-Shelby line. Further- more, land improvement through Irrigation will be considerably increased through more low-cost power. Irrigation planned in the Helena Valley, Crow Creek, and Chestnut Valley will be well-nigh climinated if Government sale and distribution of power from Canyon Ferry is stopped. Irrigation phases of the project are feasible only through the revenue possible from sale of Government power and a sched- ule of low power rates for pumping water’ The one to make the whole project pay out and the other to make it possible for farmers to operate irrigation pumping stations with- out going bankrupt Congress contemplates no additional appropriation for irrigation, we are told, and there 1s little hope for such action in the foreseeable future. The charge that more Government power lines means duplication of lines 1s not a fair nor accurate argument because present distribution fa- cilitles are not able to deliver firm power to all customers, and the power demands in Montana are increasing every year. There is need for much more Government generation and distribution of hydroelectric energy in the State, and even a considerable increase in Government power facilities would still leave ample opportunity for existing private power companies. Besides blocking the low-cost power pro- gram in Montana, the efforts of the Montana Power Co, against the Government tiansmis- sion lines, if successful, will seriously impede further irrigation developments Great numbers of Montana farm people are depending on your able leadership and the efforts of your coworkers to restore the funds for the Havre-Shelby and Canyon Ferry lines. Lreonarp KENFIELD, Editor, Montana Farmers Union News. oe HELENA, Mont., July 7, 1950. Hon James E Munray, United States Senate, Washington, D C: Urge that nothing be put in the way of construction and completion of the Havre- Shelby transmission line because it is of vital importance to the people of this State. Its abandonment would be a serious blow to the prosperity of Montana and the future growth of Montana. JouHN W. Bonner, Governor. Burrs, Mont., July 13, 1950. Senator James E, Murray, Washington, D. C.: Rocky Mountain Sportsmen's Association, being fully cognizant of what completion and operation of Havre-Shelby lines as a public-power project means in ensuring a jarge and stable supply of inexpensive power for Montana industry and consumers alike, urges that necessary appropriations for this project be restored by the United States Sen- ate, Havre-Shelby, Canyon Ferry, Hungry Horse, and other public-power projects, when completed and in operation, will prove Montana's greatest attraction to out-of- State industries. In providing low-cost power for their operations, this in turn means thousands of new jobs for Montana workers, a greatly expanded market for the JULY 19 producta of Montana farmers, and little- business men, and likewise a greatly broad- ened tax base so vitally needed for success- ful operation of Montana schools, city, county, and State governments. Rocky MOUNTAIN SPORTSMEN’'S ASSOCIATION, Joun STanton, President, Corvatiis, Monrt., July 13, 1950. Senator JAmzs E Murray, Senate Office Building, Washington, D.C.: Urge no eliminating of funds appropriated for Havre-Shelby transmission line, This line necessary to serve electric energy in the State of Montana for developments Pau. BRISSONNEAUD. CurnooK, Mont., July 13, 1950. Senator Jame; Murray, Senate Building, Washington, D.C.: Request that you use all possible means to keep the Havre-Shelby transmission line from falling into the hands of piivate utility interests. Be sure that tunds to complete this line are added to the budget. Do not let these utilities take this line as it will mean a tremendous loss to the taxpayers whose money is invested in the Fort Peck Dam and who stand to gain by the sale of Fort Peck power at 5.5 mills to REA instead of 2.5 mills to the Montana Power Co. We ranchers and farmers served by REA lines realize that without public power we would never have the advantage of electricity we now have. Do not let private interests rob those of us who do not yet have electric service. We know this is a difficult battle but you have our endless support Tom Ness, D L Murphy, John Scott, Harold A Hatve, Author Dahl, Edward Dahl, R D. Doughton, Rudolph Block, Arthur W. Campbell, A E Cole, Thos, Staff, Ole Eklong, Jas Spencer, H. A, Marsh, Leo Gist, Geo. Vandeven, Ar- thur C Jacobsen, Jess Conrad, Charles Pancretz, John Redekap, Chas. Green- burg. HELENA, MONT, July 12, 1950. Hon JAMEs E Murray, United States Senate: We, the undersigned, respectfully request that sufficient appropriations be made to complete the Havre-Shelby power-transmis- sion Hne, and that the Fede1al Government operate this power line rermanently in the interests of the people of Montana Marian Covington, Gussie Chapman, John E. Sasek, Harry Norton, Francis Small, Elizabeth Hawks, Ruby Lee, Joseph Casey, Mr. and Mrs. E W. Prut- tis, Lucy T. McLemore, C. C. Coving- ton, Caroline Christian. HELENA, MONT., July 12, 1950. Senator JAMEs E Murray, Senate Office Building: Appropriation for Havre-Shelby transmis- sion line as a public project last year gave new hope to REA cooperatives and farmers of Montana. It must not be allowed to be abandoned as it approaches completion. Do everything possible to have the appropriation for construction of this vital project ree stored. Lee MErTcaLi, SuxE.sy, Mont., June 30,1950. Senator James EF. Murray, Washington, D.C. Dear SENATOR Murray: This cooperative has been advised that the Montana Power Co, is offering to buy and is trying to secure control of the Havre-Shelby 115-kilovolt transmission line and facilities now under construction by the Bureau of Reclamation, The contractor expects to have this line com- pleted by October 1 of this year. The mem-
1950 bers of this cooperative are strongly opposed to any action that would take control of this line from the Reclamation Bureau and place it in the control of the Montana Power Co. or any private utility. According to sworn testimony of Montana Power Co. officials in previous hearings before your committee, the Havre-3helby transmission line is entirely unfeasible and is an indefensible waste to taxpayers money. Now we are informed the same Montana Power Co. offers to buy out the contractor, the Reclamation Bureau and the United States Government itself insofar as the aforesaid line is concerned. The com- plete reversal of power company statements and action at this time amounts to an ad- mission that it was wrong in its previous testimony, and establishes beyond question that the Havre-Shelby line will, upon con- struction, become a very valuable asset and @ key to open up the resources of the area in eastern Montana, and will be the means of giving the people of this area a plentiful supply of low-cost electric energy. In view of the value and importance of this trans- mission line and its facilities, it becomes apparent that it would be an indefensible act to turn it over to any private utility. In an address given by Regional Director Vernon last fall in Havre, the statement was made that this line will pay for itself and return to the people of the United States a surplus of many millions of dollars. This plain fact explains the desire of the Montana Power Co. to secure control of the line. The mem- bership of this cooperative strongly urges the Congress to continue in force appropria- tions already made for this line as i‘ is critically needed in this area. Respectfully yours, E. J. BYRNE, Vice President, Marias River Electric Cooperative. SHELBY, MONT,, June 30, 1950. Senator James E. MurRay, Washington, D.C.: This cooperative has been advised that the Montana Power Co. is offering to buy and is trying to secure control] of the Havre-Shelby 115-kilovolt transmission line and facilities now under construction by the Bureau of Teclamation. The contractor expects to have this line completed by October 1 of this year. The members of this cooperative are strongly opposed to any action that would take control of this line from the Reclamation Bureau and place it in the con- trol of the Montana Power Co. or any private utility, According to sworn testimony of Montana Power Co. officials in previous hear- ings before your committee, the Havre-Shel- by transmission line is entirely unfeasible and is an indefensible waste of taxpayers’ Money. Now we are informed the same Mon- tena Power Co. offers to buy out the con- tractor, the Reclamation Bureau, and the United States Government itself insofar as the aforesaid line is concerned. The com- plete reversal of power company’s state- ments and action at this time amounts to an admission that it was wrong in its pre« vious testimony, and establishes beyond question that the Havre-Shelby Hne will, upon construction, become a very valuable asset and a key to open up the resources of tho area in eastern Montana, and will be the means of giving the people of this area a plentiful supply of low-cost electric energy. In viow of the value and importance of this transmission line and its facilities, it be- comes apparent that it would be an unde- fensible act to turn it over to any private utility. In an address given by Regional Di- rector Vernon last fall in Havre, the state- ment was made that this line will pay for itself and return to the people of the United States a surplus of many millions of dollars. This plain fact explains the desire of the Montana Power Co. to secure control of the line. The membership of this cooperative XCVI——-668 CONGRESSIONAL RECORD—SENATE strongly urges the Congress to continue in force appropriations already made for this line as it 1s critically needed in this area, Respectfully yours, Don HELLINGER, President, Marias River Electric Cooperative, Havre, Mont., July 11, 1950. Senator Jamgs E. Murray, Senate Office Building, Washington, D.C.: Bureau of Reclamation contractor on Havre-Shelby line personally informed me today that construction is proceeding and by end of July 53 miles of poles will be erected, 58 miles of poles framed, 63 miles of poles hauled. Also wire stringing will start soon, not later than August 1. All material on the job for this 99-mile Hine. Line will be com- plete about September 15, 1950. All persons contacted on our REA project by letter. Everyone urges that this line be completed, owned, and operated by Bureau of Recla- mation, not Montana Power. Labor unions, farmers’ unlons, REA cooperatives, and other persons interested in this line urgently re- quest that the appropriations requested by the Bureau for completion of this line be granted. Request you carry the fight as far as necessary. The people of Montana want this line to remain as the key to the de- velopment of Montana's resources und for military defense if the need be. Haron C., EBAuGH, Manager, Hill County Electric Co-op, Inc, — Kauispett, Mont., July 12, 1950. Senator James E. Murray, Senate Office Building, Washington, D. C.: The board of trustees of the Flathead Electric Cooperative Inc. urge appropriation of necessary additional funds for completion of the Havre-Shelby transmission line. We respectfully call your attention to the neces- sity of this line. Even Montana Power Co, now admits this when they believe trans- mission line within their control. This evi- dence alone is enough to condemn these people and their plans to own or control this and other transmission lines in the State of Montana that are needed for the develop- ment of Montana through abundant low- cost power. We ask construction of this line in order that wholesale power may be made equally available to the cooperatives as it is to the Montana Power Co, Let this point be definite and clear once and for all. The cooperatives unlike Mon- tana Power Co. do not want monopoly of power. They only demand an equal right to the power resources of the Nation which in this case is only possible through the construction of the Havre-Shelby transmis- sion line. This is not a gift if Montana Power can pay out here cooperatives will do equally well. Our people, as citizens of Montana and the United States have this right of develcp- ment and use through the facilities of our Government when necessary. Will you grant them this right? Respectfully, Cras. A. GREEN, President, Flathead Electric Coop- erative, Inc, — Heiena, Mont, July 12, 1950, Hon, James E. Murray, Senate Office Butlding, Washington, D. C.: Western Montana council! for CVA vigor- ously opposes abandonment of Havre-Shelby transmission line. The line is a vital link in providing service for northern Montana Trenches and towns and tends to prevent complete monopoly control of power re- 10605 sources of the State. Sincerely hope con- gressional action will not stop the comple~- tion of the line which is already under construction. Lu Erickson. Mr. MURRAY. Mr. President, I have another large batch of telegrams which I shall not ask to have printed in the Recorp, but I should like to have the names of the senders of the telegrams printed in the Recorp. There being no objection, the names of the senders of the telegrams were or- dered to be printed in the Recorp, a3 follows: Hazel D. Pilgeram, secretary and treasur- er, Armington Farmers Union, Beli, Mont. A. L. Nicholls, Ulm, Mont. Robert E. Brown, Butte, Mont. Mr. and Mrs. Ralph E. Salisbury, Flowerre, Mont. Ralph E. Clark, Shaw, Mont. Mr. and Mrs. B. F. Cooper, Simms, Mont. Missoula Electric Cooperative, Inc., Mis- soula, Mont. Representative Walter Laas, Chester, Mont. Liberty County Times, Chester, Mont. Mary M. Condon, State superintendent of public instruction, Helena, Mont. Darby O’Brien, Chester, Mont. Charles C. Smith, president, Mussellshell County Farmers Union, Roundup, Mont. J. M. Glass, chairman of Farmers Union Local, Lewistown, Mont. Don W. Chapman, Montana Farmers Union, Great Falls, Mont. Claude M. Johneon, Stevensville, Mont, Joe Hackett, Stevensville, Mont. Sheridan County Farmers Union, Irvin V. Peterson, Plentywood, Mont. R. J. Lewis, county chairman, Fergus County Farmers Union, Lewistown, Mont. Representative Robert 8. Cotton, Glasgow, Mont. Richard Shipman, president, MVA Asceociation, Lewistown, Mont. Cecil O. Burdick, Brady, Mont., chairman, Pondera Legislative Committee Farmers Union. Pat C. Sullivan, sccretary, Plumbers State Association, Butte, Mont, Eddie J. Williams, secretary; Aaron R. Shull, assistant secretary, Montana Trans- mission Electric Cuoperative, Inc., Lewis- town, Mont. Ted €kornogoski, legislative chairman, Daniels County Farmers Union, Scobey, Mont. Charles A. Banderob, legislative chairman, Iuntley Project Local, Huntley, Mont. Fred C. Kuchne, Big Fork, Mont. Mrs, Andrew Dahl, public relations direc- tor, Sheridan County Co-op., Inc., Plenty- wocd, Mont. J. Harry Wilson, Stanford, Mont. William H. Sennett, manager, Park Elec- tric Co-op, Livingston, Mont. Andrew Dahl, State senator, County, Plentywocd, Mont. Claude Hookham, president of Emigrant Farmers Union, Livingston, Mont. Henry Marken, chairman, Swan River Farm Union, Bigfork, Mont. Mr. and Mrs. Charles Mills, Inverness, Mont. Bruce L. Packer, Inverness, Mont. Mr. and Mrs. Edger Lincoln, Rudyard, Mont. Martha Packer, Havre, Mont. Berger Johnson, Joplin, Mont, Kenneth Bangs, Inverness, Mont. Ben Shand, Cartersville Local Farmers Union, Cartersville, Mont. FP. J. Brietbach, legislative chairman, Mo- Cone County Farmers Union, Circle, Mont. Mr. and Mrs. Emit) Storvik, Mr. and Mra. Bernhard Strovick, Mr. and Mrs. Howard Hall, Inverness, Mont. Montana Sheridan
10606 Harry Soderberg, mayor, city of Havre, Mont., Havre, Mont. Ole Wee Larslan, North Valley County, Glasgow, Mont. State Senator David F. James, Joplin, Mont. Devon Farmers Union, Devon, Mont. John Evanko, junior secretary, Cascade County Trades and Labor Assembly, Great Falls, Mont. ¥, L, Schnebly, president, Harold Thielman, secretary, Farmers Union, Local No. 181, Chester, Mont. Ralph F. Cook, Belt, Mont. Mr, and Mrs. Ronald Haltz, Floweree, Mont. Bertha P, Maki, Great Falls, Mont. Lee Roy Smith, Mrs. Audrey Smith, Harold Hardinger, Hazel G. Hardinger, Belt, Mont. Harvey Talvi, secretary-treasurer, Willow Belt Farmers Union, Great Falls, Mont. Leland 8. Davis, Vaughn, Mont. Harvey Talvvi, Belt, Mont. John Geikkila, Belt, Mont. E. W. Chapman, president, Montana Farm- ers Union, Great Falls, Mont. W. H. Oldenberg, manager, Lincoln Elec- tric Cooperative, Eureka, Mont. Ed Cogzad, secretary-treasurer, Missoula County Central Trades & Labor Council, Mis- soula, Mont. Mr. and Mrs. F.B Potts, Missoula, Mont. Mineral County Democratic Club, Superior, Mont. Edwin Buck, S8r., Corvallis, Mont. E. K. Babcock, Great Falls, Mont. Lester Rutledge, Sandy, Mont. Harmon £E. Dickey, chairman, Buffalo Rapids Local Farmers’ Union, Glendiv, Mont. Anton B. Smale, chairman, Legislative Committee, Local No. 72, East Helena, Mont. Robert C. Weller, secretary, Montana Dis- trict Council, Lumber and Sawmill Workers’ Union, Kalispell, Mont, Arnold H. Olson, attorney general, Helena, Mont. Ernest Salvas, president, Deer Lodge Min- ers Union, Local No. 834, IUMM&SW, Butte, Mont, Hugh Adair, Helena, Mont. John W. Swackhamer, Missoula, Mont. Leo C. Grayhill, speaker, Truman G. Brad- ford, mayor, Great Falls, Mont. Resner Blikken, president, Montana State Rural Electric Co-op Association, Opheim, Mont. Wesley W. Wertz, chairman, Democratic County Committee, Helena, Mont. A. 8. Lattin, secretary, Local No. 39, Fair- field, Mont. Northern Electric Co-op, Inc. William Mason, executive board member, District, No. 1, International Union of Mine, Mill and Smelter Workers, Butte, Mont. Shelby Chamber of Commerce, Fred Pfann- smith. Miles Romney, Glen Varner, Curtis C. Cook, Gilbert Jellinek, Hamilton, Mont. Grant Flange, Galata, Mont, Union Elevator Co., Galata, Mont. Peder Underdal, Galata, Mont. Oli C. Brevik, Devon, Mont. E. L. Nordberg, Whitehall, Mont. Charles M, Curfman, Devon, Mont. Henry Halverson, Devon, Mont, Louis Kanning, Devon, Mont. Peder Tuvdet, Devon, Mont. Ote Simmerstad, Devon, Mont. Raymond Zelenka, Devon, Mont. Fred Finger, Devon, Mont. A. L. Arsen, Devon, Mont. Darwin Snuffer, Devon, Mont, John Englund, Devon, Mont. J. M. Larsen, Devon, Mont. Nils I, Fredrickson, Devon, Mont, Elmer C. Chilbers, Devon, Mont. Quinten Larsen, Devon, Mont. Bradford Skinner, Devon, Mont. Clara G. Prestbye, secretary, Kalispell Farmere’ Union, Local No. 153, Kalispell, ont. Edward Fenske, Whitefish, Mont. CONGRESSIONAL RECORD—SENATE Florence Slethaug, legislative chairman, Swan River Farmers’ Union Local, Creston, Mont. J. H. White, Devon, Mont. Mr. and Mrs. Melvin Adamson, Devon, Mont. Mrs. Gorden Twedt, secretary, Black Cou- lee Farmers’ Union, Rudyard, Mont. Emmers Berg, Berg Motors, Chester, Mont. Hanson Electric, Cliff Hanson, Chester, Mont. William Rambo, Hingham, Mont. Erland L. Olson, Alberton, Mont. Frank J. Lochdutton, Great Falls, Mont. N. J. Dougherty, secretary-treasurer, Mon- tana Farmers’ Union, Jamestown, N. Dak. Vigilante Electric Cooperatives, Dillon, Mont. Riley W. Childress, Galata, Mont. Flora E. Wright, Silver Star, Mont. Ole Sanvik, Kalispell, Mont. L. J. Schaefer, Chester, Mont. John Swank, Chester, Mont. Mr. and Mrs. Elmer Sathre, Mr. and Mrs. Guy Nelson, Havre, Mont. Mr. ECTON. Mr. President, I think we have all received hundreds of tele- grams with reference to this item in the bill. I wonder if the able Senator from North Dakota [Mr. Lancrr] and my col- league from Montana {Mr. Murray] would like to hear a telegram which I received from Livingston, Mont. The Senator from North Dakota mentioned a long list of persons and read a very long telegram. I also have a telegram from Livingston, Mont, which I think will explain why so many telegrams were sent with reference to this particular line. The telegram is dated July 12, 1950, and reads as follows: LivrnasTon, Mont., July 12, 1950. Hon. ZaLEs N. Ecron, Senate Office Building, Washington, D. C.: Impelied by MVA and western council of CVA broadcasts am wiring you urging that you continue to back action of Appropria- tions Committee and the standing taken by the International Brotherhood of Electrical Workers as well as CIO in cutting appropria- tions for Havre-Shelby line and Canyon Ferry-Great Falls line, which would only be duplicating existing lines at expense of tax- payers and throwing Government into com- petition with free enterprise. Labor eagerly watching this in Montana. Wrusur M. RANEY, Business Manager, Local Union No. 341, IBEW. Mr. President, that explains why there has been an avalanche of telegrams sent here to Senators representing other States, with reference to this line. Mr. MALONE. Mr. President, will the Senator yield? Mr. ECTON. For what purpose? Mr. MALONE. For a statement. Mr. ECTON. Mr. President, I ask unanimous consent that I may yleld to the Senator from Nevada to make a statement without losing my right to the floor. The PRESIDING OFFICER. Is there objection? The Chair hears none, and the Senator from Nevada may proceed. IMPORTANCE OF REORGANIZATION IN WINNING THE WAR Mr. MALONE. Mr. President, we are committed to the Korean war, and we shall all make any sacrifice to win that war. That does not, however, take one jota from the stigma of the stupidity on JULY 19 the part of our officials who made it necessary for us to get into this predica- ment. The President has asked for §10,- 000,000,000 as a starter. We will ask the taxpayers for that amount, but no one is naive enough to believe it is the final cost, We still have no definite foreign policy. We will, I hope, scrutinize very carefully any blanket authority since he has shown little judgment in past per- formances in such matters. Mr. President, the junior Senator from Nevada in an address delivered on this floor on March 4-5, 1948, said: PEACE AND SAPETY OF THE UNITED STATES 1. The peace and safety of this Nation is seriously threatened, through the complete absence of a definite foreign policy, telling our own people and the nations of the world what we consider will threaten our ultimate peace and safety, and the complete absence of a military organization spearheaded by an air corps to enforce our pronouncement. 2. The basic subject of foreign policy has never been discussed with the American people, through two world wars, and now the Marshall plan is in the same category. The basic subject at issue (as it was in 1823 when the Monroe Doctrine was estab- shed to protect South America and the Western Hemisphere from encroachment from the European empire-minded nations) ts what areas—and naming the nations in the European and Middle East countries, includ- ing Asia and the South Seas—is it necessary for us to currently protect for our own ulti- mate safety? Until this decision is made no plan to make it effective can be intelligently discussed. I challenge the State Department to name the nations of the 56 member countries of the United Nations organization, whose in- tegrity we must currently protect for our own ultimate safety, to tell the world and the American people the truth, so that any empire-minded nations may be apprised of our intentions and thus avoid what could well develop into a third devastating world war, and that our own people may prepare for their own defense, through rebuilding our military organization spearheaded by an air corps that could keep any other nation on the ground in the event of war. HUNGRY PEOPLE-——COMMUNISM—REHABILITA- TION OF INDUSTRY 3. It 1s impossible to consider the feeding of hungry people—the stopping of commu- nism—and the rehabilitation of industry as one subject. We only confuse ourselves. As a result we mix our emotions with the facts and become unwilling victims of the greatest propaganda machine ever estab- lished in Washington; let us take them one at a time: (a) Feeding emergency hungry people of Europe or of any other area is a matter of charity and must be so considered apart from other considerations. The Congress of the United States has appropriated nearly $1,500,- 000,000 during the last 12 months for that purpose alone, and has appropriated $24,000,- 000,000 and handed it .o the nations of the world without hope of repayment aince the close of World War IT in 1945, The December 1946 appropriation of @597,- 000,000 is expected to last into March of this year; and the Congress is ready to con- aider further reasonable gifts for food, until Europe completes its third crop, to the extent that our own resources will withstand the impact without further inflation. (b) Stopping communism through pro- tecting the integrity of the nations of the world that we decide, after full discussidh and study, we must currently protect for our own ultimate safety, ts a matter of our own
1950 integrity and frankness with our own citi- gens—and with the nations of the world. If we should decide, after full considera- tion of our experience through two world wars—and our improved methods of defense and offense—that a threat to the integrity of any member nation of the United Nations organization, by any other nation would constitute a threat to our ultimate safety— then President Monroe's exact words could be utilized in announcing an extension of the established Monroe Doctrine, leaving out any reference to the Western Hemisphere, and say, in effect, to the world and to the American people that: “We owe it therefore to candor, and to the amicable relations existing between the United States and those powers, to declare that we should consider any attempt on their part to extend their system, as dangerous to our peace and safety.” We should then build at once a military force, spearheaded by an Air Corps that would bear silent evidence to all concerned that we were ready and able to enforce the extended doctrine, just as we have enforced the original Monroe Doctrine covering the Western Hemisphere for more than 125 years, and which kept us out of a major war for more than 75 years. The Congressional Air Policy Board has recommended a long-range military plane purchase program, which would provide a 35,000-plane striking force costing $16,800,- 000,000 over a 5-year program. The Presi- dent’s Air Policy Board's recent report closely Parallels this document. The Armed Services Committees of Con- gress should immediately check these reports and if found correct recommend their adop- tion and the appropriation of the necessary funds by the Congress of the United States for the entire 5-year program. Congress could apply the Marshall plan 4-year funds of $17,000,000,000 to the $16, 800,000,000 5-year plane purchase program and have approximately enough left to con- tinue the necessary European nations’ feed- ing program until they raise a third crop and to furnish the necessary funds to the RFC or the World Bank for the rehabilita- tion of the European nations’ industry un- der the Reconstruction Finance Corporation rules, as applied to American citizens. (c) The rehabilitation of the industrics of the 16 Marshall plan European countries, entirely separate from feeding hungry people, can then be accomplished as a purely bust- ness transaction in the same manner as such industrial plants were financed in this country by the Reconstruction Finance Cor- poration during depression and World War II years. A reasonable amount of money, say $1,- 000,000,000, could be appropriated and made avatlable to the RFC or to the World Bank for that specific purpose, simply providing that the RFO rules and regulations be ap- plied to any foreign-business loans. Their rules provide for an investigation of the feasibility of such an industry by an ex- perienced investigator in the respective field, with an estimate of cost, together with a lst of the needed machinery and supplies. They further provide for a lien or mortgage to be taken on such equipment—the stock or shares of the existing organization to be hypothecated as additional security for such loan, and then the signature of the applicant is required. It will prove a pleasant surprise to both the Congress and to the State Department the relatively small amount of funds that the European nations will require for industrial Plant refinancing, if such loans must be se- cured on a business basis. 4. The entire thesis and point of my argu- ment is that the feeding of hungry people, whether located in this or any other nation— the international policy of protecting the integrity of foreign areas in the interest of CONGRESSIONAL RECORD—SENATE our own ultimate safety—and the rehabill- tation of industrial plants in such foreign nations, must be considered separately to make sense and to be understood by our own people. The extent that we can and should feed the hungry people of the world—and the amount of money we may loan for rehabilitation of industrial plants on a business basis through- out the world—is the particular business and responsibility of the Congress of the United States—while the international policy, the determination of the areas and nations of the world that we must currently protect for our own ultimate safety is a State Depart- ment matter, Mr. President, just common, ordi- nary horse sense would dictate that the executive branch of our Government, which is charged by the Constitution with fixing foreign policy, would do just that within the 5 years since the close of World War II and prepare to defend the doctrine established. No one, least of all the State Department, seems to have any definite idea of what lies ahead. Mr. President, the junior Senator from Nevada insists that the proper procedure at this time is for the Secretary of State, Dean Acheson, to resign because of his stupid bungling in foreign policy which has brought this country to its present plight. The Department which carries on our diplomatic relations should be com- pletely reorganized. In World War I, when the fighting was toughest for the British, the scandal of ammunition shortage and incompetent thinking by the top officials caused a col- lapse of the Government and put Lloyd George in power. Thus, there is a good precedent for reorganizing to win. There is little confidence in Secretary Acheson or the State Department any- where in this country, either to keep us out of war or to win such a war with a minimum cost in lives and property once we are committed. REPORT OF AVIATION COMMITTEE, 1948 Mr. President, at that time there was a report available from two aviation com- mittees, one appointed by the President and one appointed by the Congress of the United States. They agreed that approximately $17,000,000,000 was neces- sary to be spent over a period of 5 years to build an air corps that could keep any nation on the ground that doubted our ability to defend the areas named as im- portant to our ultimate safety, and to put the foreign nations on notice so that they would not try out their strength to see what we would do in such a case. UNPLEASANT EXPERIENCES WITH STATE DEPARTMENT The many unpleasant chapters of American diplomacy in the Far East, of which Korea is the latest but probably not the last, are the direct sequel to amateurish bungling, which, in retro- spect, actually seems to have been de- signed to make the Communists dom- inant in Asia. Very recently we were in- formed by a prominent State Depart- ment official that a group in our State Department believed that a dose of com- munism would be “good for Asia.” These men are still in responsible posi- tions in our Government. - 10607 The junior Senator from Nevada wonders if the attachment of some of our State Department officials, including Secretary Acheson, for Great Britain had its basis in the fact that those officials approved Great Britain's assistance to the Communists. Mr. President, let me read a brief news item. It is an Associated Press dispatch which appeared in the Philadelphia Evening Bulletin and other newspapers on July 17: Hone Kone, July 17.—Shipping between Hong Kong and Communist China is step- ping up. About 20,000 tons of cargo ts scheduled for Shanghai, Tientsin and Tsingtao within the next few days. The cargo is mainly industrial chemicals, paper, copper wire, steel bars, cotton, med-~ ical supplies, and petroleum, Shippers here are reported looking for- ward to full-scale resumption of trade with Red China now that the Chinese Nationalists air and sea arms have been restricted in their operations against the Chinese main- land by presence of the United States Sev- enth Fleet in the Formosa Strait. OUR FLEET STOPPING NATIONALIST CHINA'S IN- TERFERENCE WITH ENGLAND'S SHIPMENTS OF WAR MATERIAL TO COMMUNIST CHINA It will be well to remember that the President’s direct orders were for the Seventh Fleet to stop the Nationalist Government from interfering with this shipping (Englands shipping of war ma- terial to Communist China). Therefore, it is understood that ‘20,000 tons in a few days” would make up a lot of steel bars, copper wire, medical supplies, cot- ton, and petroleum that are necessary for these areas to ship on to North Korea to use against American troops. Today’s Wall Street Journal says: Britain announced she has shut off all oil shipments to Communist China. Apparently she is still furnishing the Communists with chemicals, paper, cop- per wire, steel bars, and cotton, as well as other supplies, all of which are neces- sary to continue the war in Korea. JOINT RESOLUTION TO STOP AID TO RUSSIA Mr. President, I may mention further that on January 24 of this year the junior Senator from Nevada introduced a joint resolution which would have stopped any assistance from this country to any of the 16 Marshall-plan countries who fur- nished war materials or materials which would be helpful in consolidating the gains of the Communists and in prepar- ing them for world war III in eastern Asia and China. Mr. President, that joint resolution is still buried in a Senate committee controlled by the Democratic Party. Mr. President, those treaties are still in full force and effect, and no indication has been had that those countries are not shipping goods as usual, Those goods include all the materials, such as ball bearings, tool steel, and electrical equipment, heavy road machinery to build roads and airports, and heavy farm machines to step up food production. They include all the material that is nec- essary for the Russians to consolidate their gains und to fight world war III with us. It is the State Department that has said Russia is backing the North Koreans in this war.
10608 Mr. President, these shipments have been going forward for 6 years, and are still being delivered to Russia and the jron-curtain countries. We say we are going to contain Russia. Contain her with what? By shipping her every known material that we have in the United States of America and in the 16 Mar- shall-plan countries to whom we are fur- nishing the industrial machinery with which to make all kinds of war material. That is the State Department's idea of containing Russia. DIPLOMATS GET US INTO WARS Someone once said that our diplomats get us into wars and our Armed Forces fight them. In our present trouble in Korea, let us face the facts. This is the third world war a Democratic adminis- tration has gotten us into, and the junior Senator from Nevada, speaking for him- self, would like to say that if they save him from about two more wars it will be too late. KOREA RESULT OF STUPID POLICY We are now having trouble in Korea because of our stupid foreign policy. We would probably never have had to face what President Truman calls this threat to the peace of the world, at least it would have been long delayed, had it not been for the gross blundering by the administration in the fleld of foreign policy. YALTA-—ACHESON AND HISS At Yalta, with the advice of Dean Acheson's friend, one Alger Hiss, since labeled “‘a Red traitor,” our ailing Presi- dent bribed Stalin to intervene in the far-eastern war. This was quite unnecesary, for, as Mr. Hiss no doubt well knew, Japan was then on its last legs and had already made several unofficial overtures for peace. Manchuria was handed over to the Reds at Yalta, and this paved the way for the Red advance into China and Korea. MR, ACHESON—RECOGNITION OF RED CHINA Mr. Acheson’s recent statement that the United States would not use its veto power in the United Nations to block recognition of the Communist regime in China was a weak-kneed position to take against the advancing aggressor, and was virtually an invitation to the Reds to go further. We are encouraging the United Na- tions to accept Communist China as a member, and to displace the Nationalist Government of China, at a time when Communist China, supplied by our sup- posed ally, is obviousty sending impor- tant war supplies into North Korea to fight against American boys and girls— material being furnished Communist China by England through Hong Kong. Obviously these supplies are reaching there, and the additional manpower is being furnished from China and Russia. We have no direct information—at least the State Department has not given it to us—whether the troops are coming from Russia or China or both, but they are well-trained troops, There is 75,000,000 available manpower in Communist China to throw against America when the time comes, CONGRESSIONAL RECORD—SENATE STATE DEPARTMENT NEITHER SUPPORTED NOR OPPOSED KOREA Mr. President, either the State Depart- ment should have clearly abandoned southern Korea, or should have done the things necessary to make it clear that an attack on southern Korea would be opposed by us. It did neither. Why? Partly because our foreign policy is both casual and improvised, and partly be- cause the State Department is unwilling to tell the American people to what it has committed them. DEFICIT DIPLOMACY-~-ACHESON-LATTIMORE POLICY It is imperative that a stop be put to the State Department's deficit diplo- macy. The administration has allowed our commitments to increase while our power to meet them has been allowed to decline. Obviously, General MacArthur did not prepare for the Korean campaign be- cause our State Department had never informed him that it had made commit- ments which might require such a cam- paign. In fact, the junior Senator from Ne- vada is informed thai the State Depart- ment was responsible for the military abandonment of Korea in the first place, in accordance with recommendations which were admittedly made by Laiti- more to the State Department. STATE DEPARTMENT NEVER CONSULTED MAC- ARTHUB OR BADGER Our State Department never once con- sulted either of the two persons best Qualified to advise us on our far-eastern policy, General MacArthur and Admiral Badger. In November 1948, the junior Senator from Nevada visited both of these men, whom he regards eminently qualified, and the junior Senator from Nevada got the same story then, a year and a half ago, which was told to our military off- cials on their recent visit to Japan. The story, of course, was that we could defend Japan, Formosa, Okinawa, Guam, New Guinea, and the South Seas at a tremendous increased cost in manpower and equipment following the loss of China—but that psychologically and eco- nomically we were suffering an irrepara-~ ble loss. The American people must pay the penalty in bloodshed, loss of life, and damaged prestige throughout the world because of incompetence and lack of foresight on the part of our State Department. STATE DEPARTMENT ASSISTED BY COMMERCE DEPARTMENT IN LOSS OF CHINA Our stupid foreign policy has not been limited to the State Department, unfor- tunately. There is evidence to the effect that the Far Eastern Division of the Office of International Trade in the De- partment of Commerce held up the ship- ment of gasoline and other war supplies to China in 1948 until too late for the National Chinese Government to use them effectively. The evidence shows that because of that delay General MacArthur sent ap- proximately 100,000 barrels of gasoline from his own short supply to China in order to make up for what this Congress JULY 19 had appropriated money, and the send- ing of which was being held up for 30 to 60 days in the Department of Commerce, In other words, one of our Govern- ment offices is added to the Government personnel which aided the Communists to overrun China. Heading that division was an official whose background is in- teresting to observe. This United States Government official was a man who was born in Asia of Russian parents and who had been denied American citizenship three times on the ground that he was not of good character and not attached to the principles of the Constitution of the United States. There is evidence to show that this man, whose name was Ephriam Liberman before he changed it to Michael Lee, associated with known Communists here. He finally succeeded in gaining American citizenship, and a few months later he headed a vitally important Government office in Wash- ington. It is not recorded at just what point it became respectable in this country to be suspected of being a traitor to your country. There are plenty of ex-GI’s—good loyal Americans, whose integrity and ability is unquestioned—to fill the re- sponsible jobs in this Government of ours. I understand that this man is on sick leave right at this moment, but still Is technically the head of that great division, Mr. President, the Chinese blame this man more than any other Government official for delays in vital shipments of ethane gasoline and other war supplies to war-swept China until too late for the Nationa] Government to use them effec- tively against the Reds. SHOOTING WAR—POLITICAL FIGHT AGAINST RUSSIA We went into this shooting war to wage @ political fight against the Rus- sians. Today it looks like the shrewd Russians may simply ignore the chal- lenge, neither backing down nor openly fighting. As in Greece and in the Ber- lin airlift, we may be left to expend our energy while the Russians rest and con- tinue their preparations, preparations made with materials coming from the 16 Marshall-plan countries in Europe which we are financing, and supplies coming from England, through Hong Kong, into Communist China, much of which {s finding its way to the battle front, some of the material probably with the trade-mark left on them with our boys catching the stuff in their bare hands in Korea; it is not a nice picture. NINETY-SIX TRADE TREATIES—MARSHALL-PLAN COUNTRIES— RUBSIA I repeat, the Marshall-plan nations are shipping to Russia, or her satellite countries in Europe and Communist China, materials needed to wage war. Through 96 trade treaties between Marshall-plan countries and fron-cur- tain countries we are even today arming Russia to wage world war III, and have been shipping them the needed manu- factured and processed materials to con- solidate their gains. It is not raw ma- terials like those we used to ship to Japan before World War II. That went on for 5 years prior to 1941, and every veterans’
1950 organization in the country cried to high heaven about it, yet nothing was done to stop it. But at least the Japanese were paying for the materials here in the United Statey, and they were left to manufacture and fabricate the mate- rials. This time we have moved a long way ahead; we are doing that job for the Communists. RUSSIANS TRYING US OUT Perhaps in Korea the Russians were trying to see how far they could go. If our foreign policy is not more clearly designed, these tests will continue. It ought to be determined what this coun- try can do and what it is willing to do, and those things should be told to the world in clear terms. What areas are important to our ultimate safety? THE EXECUTIVE BRANCH CHARGED WITH FOREIGN POLICY The Constitution of the United States fixes the responsibility in the executive department to fix the foreign policy for this Nation. Congress cannot doit. So what are the areas we are to defend for our own ultimate safety? Let the ad- ministration name them so that the na- tions in Europe, Asia, and Africa, in ad- dition to those in the Western Hemi- sphere, where we have made use of the Monroe Doctrine for 126 years, will know what we will fight for. So our own peo- ple, the boys and girls who came back from World War II, many of them since married and starting new businesses, are on the verge of going back. I doubt if any of them would mind going back. I would not mind going back myself, but I would like to know, and they, as citi- zens and taxpayers of this Nation, would like to know, what they are to fight about, what they are-to defend, whether they are to defend the whole world, or the areas necessary for us to defend now for our ultimate safety. What is to be our policy regarding the continuation of arming Russia through the Marshall-plan countries? What is the Korean war intended to accomplish? What do we do after we have pushed the North Koreans back across the thirty- eighth parallel? Do we intend to Icave our troops on the thirty-eighth parallel? Do we intend to continue through North Korea and garrison all of Korea for the indefinite future? Are we going right on after we get to North Korea? ‘The peo- ple of this country would like to know. I, myself, as a Member of the Senate, would like to know. WHERE DO WE GO FROM HERE? Is the sending of our troops to Korea to be regarded as a precedent. If so, of what? Despite our low opinion of the State Department, we find it hard to be- lieve they got into this thing without an idea of what they mean to make of it. They at least owe the soldiers, their wives and parents and the taxpayers an ex- planation that so far has not been forth- coming, Mr. President, I should like to read briefly from a column written by Dor- othy Thompson, which appeared in the Evening Star on July 17. It says in part: President Truman has decisively commit- ted himself and ourselves to something un- CONGRESSIONAL RECORD—SENATE decisive. We are not, he says, at war. But Americans in Korea may reasonably wish to know when shooting is not shooting, and when war is not war. And perhaps the President, whose inter- national acrobatios are astounding, may be able to tell us the objective of this shooting that is not war. The aim, we are told, is to deter aggres- sors and reestablish the status quo. Since United Nations exhortation has failed to deter, we are now out to destroy—just what ultimate forces is not clear. Yet we are committed in principle to the unification of Korea. Our object is merely to prove (by force of arms) that unification may not be accomplished by force of arms. I submit that the nightmare world in which we live 1s the direct result of fight- ing a world war for no comprehensible ob- jective. Some of these leaders today are the same persons who got us into this mess and who now ask us to trust them not to get us into another. By another of his remarkable somersaults, the President has reversed his recent opin- jon and decided to defend Formosa. But he has forbidden the Chinese Nationalists in Formosa to continue fighting Chinese Communists on the mainland. Thus com- Mmunism in Korea is apparently sinful, but communism in China is legitimate. As a direct result, according to what I have just read into the Recorp, the Presi- dent's order stopping the Nationalist Government from attacking shipping on the Communist China coast has cleared the way for England’s shipping to con- tinue carrying war supplies into the Communist China area, which are im- mediately available to North Korea to be used against American troops. I quote again from the column of Miss Thompson: It would really be a brilliant Russian move to order the North Korean armies to return to the thirty-eighth parallel in exchange for moving Red China into the Security Coun- cil—relinquishing the invasion of South Korea for another invasion of New York. STRATEGY OF RUSSIANS—ADMIT COMMUNIST CHINA TO UNITED NATIONS Mr. President, that is exactly what the junior Senator from Nevada thinks they are doing, In other words, the note to Mr. Nehru, of India, simply says that before they would discuss ending the war in Korea, we must admit Communist China to the United Nations. We have in a grandiose manner re- fused to do that, which I think is highly proper, but at the same time and out of the same mouth comes the statement from the Secretary of State that we will not oppose the Communists becoming members of the United Nations and dis- placing Nationalist China. ‘That opens the way for us to recognize Communist China, by the same excuse, through the kack door, a little later. ACHESON COMMITTED US TO RECOGNIZE RED CHINA Mr. President, I wish to repeat what I said on the Senate floor in September of last year, 1949, when England, Canada, and the United States were meeting here in their great conference. The confer- ence to divert public attention from the most important debate in a century— extending the 1934 Trade Agreements Act. It is my humble opinion that at that moment we agreed to recognize Communist China and follow England and India into that recognition, 10609 Mr. President, the State Department has not given up this idea of recognizing Communist China. It simply does not tell the American people the truth. It does things through the back door which it dces not openly deny, and puts out tons of propaganda every day, camou- flaging its actions. STUPID HANDLING OF EVENTS LEADING TO THE KOREAN MENACE Mr. President, the stupid handling of the Korean situation, culminating in the North Korean thrust, is but another in- stance proving the unfitness of Mr. Ache- son for his high position. His adminis- tration has been wholly unsatisfactory and should be renovated from top to bot- tom. Mr. HUMPHREY. Mr. President—— The PRESIDING OFFICER. ‘The Senator from Minnesota, Mr. ECTON. Mr. President, I yicided a while ago to the Senator from Nevada |My. MaLone] under a unanimous-con- sent agreement that I not lose the floor thereby. The PRESIDING OFFICER. ‘The Chair will say to the Senator from Mon- tana that he was not then in the chair, and did not know of the arrangement. The Chair recognizes the Senator from Montana. Mr. HUMPHREY. what is the situation? The PRESIDING OFFICER. The ar- rangement was that the Senator from Montana would yield to the Senator from Nevada without losing his right to the floor. QUESTIONS ON THE KOREAN CRISIS Mr. HENDRICKSON. Mr. President, will the Senator from Montana yield to me for a brief statement and a unani- mous-consent request, with the under- standing that the Senator will not lose the floor? Mr. ECTON. I yield with that under- standing, Mr. President. The PRESIDING OFFICER. Without objection, the Senator from Montana yields to the Senator from New Jersey, without losing the floor. Mr. HENDRICKSON. Mr. President, confronted as we are with a war crisis in the Far East and perhaps disaster elsewhere in the world, as emphasized by the President’s message of today, it is incumbent upon all of us to do a httle soul-searching to ascertain the truth in respect to both the causes and effects of our dilemma, I hold before me a brief article en- titled “Korea” in which eight very perti- nent questions are asked, and because I think it would serve a good purpose for every Member of the Senate to read these questions and endeavor to find the answers, I ask unanimous consent that this article be placed in the body of the Recorp at this point in my remarks. There being no objection, the matter referred to was ordered to be printed in the Recorp, as follows: Korea Why did Intelligence fall? fail, why were we not ready? Why a handful of untrained youngsters on the front line? Mr. President, If it did not
10610 Why are our tanks inferior to the Russtan? Why are we using our old-style recoilless ‘weapon and bazooka? Why do we not have a good supply of heavy artillery? Why the lack of combat planes of the right type, both old and new style? Why are we without unit task forces of landing craft and surface ships? Why did we not have a completely equipped, balanced fighting force in Japan ready for instant use? The American people after two genera- tions of fatlure can no longer accept mili- tary incompetence in the field of prepara tion and readiness. The disgrace of Korea following the submarine disasters and flascos of the First World War, the submarines again in the Second World War, Pearl Har- bor, Bataan, Corregidor, is more than the public can bear. We have spent untold bil- lions during the recent war and since—far more than would have been necessary to have had a relatively small number of highly trained men with the world's latest and most effective weapons ready for instant use anywhere. These questions must be answered. Mr. HENDRICKSON. I thank the distinguished Senator from Montana for his courtesy. MESSAGE FROM THE HOUSE A message from the House of Repre- sentatives, by Mr. Snader, its assistant reading clerk, announced that the House had passed, without amendment, the bill (S. 3809) to amend the Mutual Defense Assistance Act of 1949. The message also announce that the House had agreed to the report of the committee of conference on the dis- agreeing votes of the two Houses on the amendment of the Senate to the bill (H. R. 7477) providing for the conveyance to the town of Nahant, Mass., of the Fort Ruckman Military Reservation. GENERAL APPROPRIATIONS, 1951 The Senate resumed the consideration of the bill (H. R. 7786) making appro- priations for the support of the Govern- ment for the fiscal year ending June 30, 1951, and for other purposes. Mr. ECTON. Mr. President, I believe all of us who are Members of the Senate and work on committees usually look over very carefully the reports on all bills submitted to the committees from the various departments of the Government, I know I do, and I know the other mem- bers of committees on which I am placed do the same. We hardly ever pass a bill in the Senate without having received a favorable report from one of the govern- mental departments concerned. It seems to me that when the Congress passes a bill, and specific instructions re- specting the bill appear in the commit- tee report and in the debates in the Con- GRESSIONAL Recorp, the department con- cerned should read the report of the committees and the debates in Congress before it proceeds to act. I wish to congratulate the Senator from Arizona (Mr, Hayprn) for mapping out and defining a power policy which seemed to be fair and which seemed to be workable a year ago. The instruc- tions in the report and as they appear ih the ConcREssIonaL RxecoRD Were ex- plicit when the appropriation measure was passed by Congress a year ago. CONGRESSIONAL RECORD—SENATE Had the Bureau of Reclamation looked over the report and read the colloquys which took place between Senators on the floor of the Senate before they let the contract, we would not be here de- bating this question this afternoon. From all appearances the Bureau of Reclamation was a little overanxious to proceed, enter into a contract and get things moving irrespective of the in- structions specifically set forth in the report and in the Conar&ssIoNaL REcorp @ year ago which were set aside. Mr. President, I should like to relate in chronologica] order a few of the things that happened in respect to the Havre- Shelby line. Before I proceed further let me say that if I thought one single farmer in Montana would be deprived of obtaining electricity on his farm by virtue of discontinuing this line at this time, I certainly would vote against the committee’s proposal. But I am thor- oughly convinced that no farmer in Mon- tana is going to be deprived of electricity by curtailing this line at this time, and that the farmers are going to receive electricity just as cheaply, whether the line is built or whether it is not. I hope to be able to prove that in a few minutes. I have always been interested in REA. I have done everything I could to assure the farmers of the Nation that they would have electricity on their farms as soon as it was possible for them to get it. I have worked diligently during the Jast 3 years to get the rates lowered to the REA co-ops in the State of Mon- tana. That objective has now been at- tained. I certainly would not want to deprive any farm or any farmer from receiving that service at the lowest pos- sible rate, It wil] be recalled, Mr. President, that on May 26, 1948, the House committee report on the Interior Department bill for the fiscal year 1949 disallowed a re- quest for the $1,035,000 for construction of the Havre-Shelby transmission line and substations, and further rescinded 8 carry-over of funds of $560,197 which had been appropriated the previous year for the line. Congress in passing the Interior Department's appropriation bill sustained that position. Then on March 28, 1949, the House committee disallowed $1,300,000 re- quested for initiating construction of the Havre-Shelby transmission line, and initiating construction of the Havre- Shelby and Rudyard substations. On July 18, 1949, the Senate Appro- priations Committee reported the Inte- rior Department appropriations bill for the fiscal year 1950, and in that bill the $1,300,000 disallowed by the House was not restored. We must remember, Mr. President, that there was no appropriation by the House last year for this line. When it was considered by the Appropriations Committee of the Senate that commit- tee still turned it down. But it was put in the bill on the Senate floor a year ago, with instructions which were placed in the Recorp by the distinguished and able Senator from Arizona that it was to be used as a bargaining power primarily between the Reclamation Bureau and the power companies for wheeling agree- JULY 19 ments to get service to REA's and to the farmers at the lowest possible figure. After the House refused to place the item in the bill last year, after the Sen- ate Appropriations Committee refused to consider it, it was added to the bill on the floor of the Senate and the confer- ence committee agreed to it. On August 25, 1949, when the bill was before the Senate for consideration, the Senator from Arizona [Mr. HaypEn] on the floor of the Senate stated: I suggest to them that the Senate disagree to the Senate amendment (regarding the Anderson Ranch Dam—Mountain Home transmission line in Idaho), with the under- standing that the Bureau of Reclamation will do as we have instructed it to do, both with respect to Southwestern Power Ad- ministration and Montana Power, that is, seek to enter into negotiations with the Idaho Power Co. with respect to the transmission of this power. Mr. President, what the Senator from Arizona intended and what the Senate voted at that particular time is as plain as the nose on one’s face. The bill was passed on October 12, 1949, after the Senate had restored funds for the Havre-Shelby transmission line, with the understanding that the funds would not be used if a wheeling contract could be arranged for transmission of power to the REA cooperatives in that arca, This question is important, because I be- lieve it was stated here in the Senate this afternoon that the power company did not offer to make wheeling agreements. According to my understanding, however, on October 13, 1949, the Montana Power Co. notified the Bureau of Reclamation that the company was willing to negotiate a wheeling agreement to serve the REA cooperatives in the Havre-Shelby area. On November 1, 1949, the Bureau of Reclamation announced a ¢all for bids on the Havre-Shelby transmission line. Many persons in that area did not even know that negotiations were going on, until they saw the announcement in the newspaper. On November 15, the Bureau of Recla- mation announced a call for bids on sub- stations at Havre, Shelby, and Rudyard. On December 6, 1949, the Bureau of Reclamation received bids on the Havre- Shelby transmission line. So, Mr. President, we see that on Au- gust 25 the Senator from Arizona [Mr. HAYDEN] made his statement, and on Oc- tober 13 the company offered to negotiate for wheeling agreements, and on Decem- ber 6 the Bureau of Reclamation received bids for the line. On December 30, the Bureau of Rec- lamation approved a contract for con- struction of the Havre-Shelby line. On February 20, 1950, representatives of the Montana Power Co. and the Bureau of Reclamation conferred in Butte, regarding negotiations for a wheeling agreement. I understand that at that meeting the Havre-Shelby line was discussed. Sometime in March, the Bureau of Reclamation received bids for a substa- tion near Havre. On March 18, 1950, the Montana Power Co, executed with the Bonneville Power Administration a contract under which
1950 the company will purchase up to 50,000 kilowatts of power from the Hungry Horse Dam, and under which the com- pany will serve REA electric coopera- tives in western Montana for the Bon- neville Power Administration. The Bonneville Power Administration read the instructions and the statement of the congressional intent. The Bonne- ville Power Administration was not in a big hurry to build the line merely be- cause it had the money with which to build it. On the contrary, the Bonne- ville Power Administration negotiated and entered into an agreement with the Montana Power Co., as was intended by the Senate when the appropriation bill containing provision for these lines was passed. On March 20, 1950, representatives of the Montana Power Co, and the Bureau of Reclamation held a meeting at Bill- ings, Mont., regarding negotiations for a wheeling agrcement. That was on March 20, after bids for the line had been received. On March 22, the contractor was di~ rected by the Bureau of Reclamation to proceed with construction of the Havre- Shelby line as soon as conditions permit. It was plainly evident then that there would be no poSsibility of entering into a wheeling agreement. Just 20 days elapsed—including 3 Sundays—between March 22 and April 12, when the Mon- tana Power Co adopted a new rate of schedule for service to REA cooperatives in Montana, east of the Continental Divide. When that was done, it became unnecessary to enter with the Bureau of Reclamation into a wheeling agreement to give the service at the lowest possible rate to the REA cooperatives and to the farmers in northern Montana The schedule reduced the average rate to 514 mills per kilowatt-hour, which is identical with the rate of the Bureau of Reclamation for Missouri Basin power. Mr. President, I am not defending the Montana Power Co. A company which can negotiate a satisfactory agreement with the Bonneville Power Administra- tion, and a company which has reduced its rate to such an extent that it fs equal to the Government rate, I submit does not need any defense; it has put up its own defense. However, perhaps the public power trust needs a little condemnation when @ private company which pays taxes, builds its own lines, and gives a satisfac~ torily low rate to its customers. Mr. President, we have heard talk about monopoly and about the possibility that the company will have a monopoly of power. We become unduly excited about the possibility that a power com- pany will obtain a monopoly. In my State, for instance, we have a public ser- vice commission, composed of three members who are elected directly by the people of the State. That commission passes on the public utility rates, and sees to it that the people receive a just deal, If the people do not like what the commission does, all the people have to do is to change the membership of the commission at the next election—as is done in our rcpresentative government, CONGRESSIONAL RECORD—SENATE Mr. DOUGLAS. Mr. President, will the able Senator from Montana yield for a question? The PRESIDING OFFICER (Mr. Macnvuson in the chair). Does the Sen- ator from Montana yield to the Senator from Tllinois? Mr. ECTON. I am glad to yield. Mr. DOUGLAS. Is it not sometimes true that the so-called public utilities commissions are controlled by the power companies which .hey are supposed to regulate, so that those regulated actually become the regulators? Mr. ECTON, Inasmuch as the mem- bers of the commission are elected, I do not sce how they are controlled in the way the Senator has suggested, any more than any other elected officials are con- trolled. If the argument of the Senator were to hold, then it might be said that the Members of Congress are controlled because they are elected by the people. My. President, there are three mem- bers of the public utilities commission. They are elected by the people. Cer- tainly the people have a chance to catch Up with them at some time. Mr. LANGER. Mr. President, will the Senator yield? Mr. ECTON. TI yield. Mr, LANGER. For whet length of time are the members of the Montana Public Utilities Commission elected? Mr. ECTON They are elected for a term of 6 years. However, they alternate in service; every 2 years the term of one member of the commission expires, and an clection for that position on the com- mission must be held. Mr LANGER. Soif the people did not like what one 07 the commissioners did, 2 years later the people would have & chance to elect someone else; and at the end of 6 years thereafter the people would have had a chance to elect an entirely new commission. So it would be 8 years before the people could change the entire membership of the commission, in view of the fact that at 2-year intervals an election is held to fill one or another of the positions on the commission. Mr ECTON. Ofcourse, Mr. President, if the members of the commission were appointed, there might be some excuse for a charge that the members of the com- mission are contrclled by the companies they are supposed to regulate. However, when the people elect the members of the commission directly, there is no ex- cuse for such a charge. All three members of the Montana Public Utilities Commission are Demo- crats, ard I do not think anyone con- trols them. Mr. LANGER. Does the Senator think they should be condemned ipso facto be- cause they are Democrats? Mr. ECTON. No. I think they are good Democrats. Mr. DOUGLAS. Mr. President, I wish to thank the Senator from Montana for the tribute he has paid to the Democratic Party in his State. Mr. ECTON. I wish to say to the Sen- ator that I was a member of the Mon- tana Legislature for many years, and I always got along very well with the up- right and honorable Democrats. 10611 Mr. LANGER, Mr. President, let. me inquire whether they were formerly Re- publicans, and later became Democrats. Mr. ECTON. Some of them may have flopped over, away back sometime. I do not know, and I cannot vouch for that. So on April 12, the Montana Power Co. adopted a new rate schedule for the service to REA co-ops in Montana, east of the Continental Divide. As I stated, this schedule reduced the rate to the identical rate charged by the Bureau of Reclamation for the Missouri Basin power accounts, So no one in that vicinity can galn anything by buying Government power. It is impossible to get it any cheaper than the price at which it can be bought directly from the private company. I admit that some of the people think they prefer to deal with the Government They prefer to get their electricity from the Government line rather than from a private line, Such an attitude, perhaps, may be com- pared to that of an individual who wanted to go to San Francisco, but would not get on a train because the Government did not ownit. There would be just as much sense in that. In other words, if a person needs something and can get it just as cheaply from a private company, why demand that the Gov- ernment own it instead of someone else? Mr. LANGER. Mr. President, will the Senator yield for a question? Mr. ECTON Iam glad to yield. Mr. LANGER. Twice the distin- guished Senator has stated that it would be possible to get a rate of 5.5 mills, Mr. ECTON. Yes. Mr. LANGER. Does the Senator not know that in the Missouri Basin the Montana and the Dakota utility com- panies buy all the power they furnish, at that rate, but that at the place where they sell electricity, where there is no REA line, they get 2 for 1? I want to ask the Senator whether that is not true in the State of Montana, the same as it is in North Dakota. Mr. ECTON. No, not under the Bu- reau of Reclamation, not in the Missouri Basin, and not 1n the case of the Mon- tana Power Co. Mr. LANGER, Mr. President, will the Senator yleld further? Mr. ECTON. Yes. Mr, LANGER. It is true in the Mis- sourl Basin, in North Dakota. Mr. ECTON. But it is not true in Montana. Mr. LANGER. Is the Senator certain of that? Mr. ECTON Yes. I have the con- tract here, if the Senator would be in- terested in it. The Montana Power Co. takes only the excess electricity from Fort Peck, which the Government does not use to supply its preferred cus- tomers. The power company purchases it at a certain rate. Mr. LANGER. Mr. President, will the Senator yield further? Mr. ECTON. I yield. Mr. LANGER. If the Montana utili- ties companies get their power from Fort Peck, they have to get it over a line which is 200 miles long, and yet, for every single kilowatt-hour furnished
10612 them, the price could be doubled some- where else, could it not? They keep track of the number of kilowatt-hours, I cannot believe that the situation in Montana is any different from what it is in North Dakota. Mr. ECTON. I might give the Sena- tor an idea of what the Montana con- tract provided. There has been a con- tract since July 1, 1943, under which the Montana Power Co. buys from the Fort Peck project all the power which is available, after supplying firm require- ments of the Fort Peck project, and that can be used by the company itself, or by any other companies with which ft is interconnected. Mr. LANGER. What does the power company pay for it? Mr. ECTON. I do not know what is paid for it, but that makes no difference. Mr. LANGER. At what price does the power company sell it? Mr. ECTON. In the last 6 years, I may say to the Senator, the company has paid the Government $1,814,670 for this power, and the amount of the pay- ments has risen steadily from year to year. In 1945 the Government received $219,951; in 1946, $229,462: in 1947, $321,- 283; in 1948, $472,254; and in 1949, $571,- 720. So the Senator will see that in a period of 5 years it has more than doubled. Mr. LANGER. Mr. President, will the Senator yield? Mr. ECTON. I yield. Mr. LANGER, Of course that was due to the fact that REA was extended in those localities and used more power. Mr. ECTON. Let me say that the Senator is talking about a Government power line, which pays no taxes to the State, county, or city in which it op- erates. The Montana Power Co., last year, distributed through 40 counties of the State of Montana $2,044,087.89 in property taxes. That was a part of the $6,140,823 which was its total tax bill. Mr. LANGER. Mr. President, will the Senator yield further? Mr. ECTON. I yield. Mr. LANGER. The Senator does not want to tell the Senate, does he, that the $2,000,000-plus which was paid in taxes was not added to the bill of the con- sumers? Mr. ECTON. I may say to the Sen- ator that when it is known that the State of Montana has as low a rate as any of the other 17 western reclamation States, I do not think we need worry about how much the companies make. Mr. LANGER. Mr. President, will the Senator yield further? Mr. ECTON. I yield. Mr, LANGER. Ireturn to my question whether it is not true that, in some other places where there is no competition, the private companies make good this so- called cheap rate—and it is a cheap rate—by charging two for one? Mr. ECTON. In the suit of clothes which the Senator is wearing, a great many taxes are tied up. Does the Senator advocate that the Government should make his clothes, so that he would not have to pay taxes? Mr. LANGER, Oh, no. CONGRESSIONAL RECORD—SENATE Mr, ECTON. The proposition is the same. Mr. LANGER. There is no analogy. Mr. ECTON. Oh, yes, there is. It is the same thing. The private-business enterprise pays taxes. When the Govern- ment goes into business, it operates tax- free. My point is that, if the State and counties of Montana had to lose $2,044,- 087, and the National Government had to lose the difference between that sum and $6,140,000, the Senator’s taxes and mine would be that much higher. Mr. LANGER. Mr. President, will the Senator yield? Mr, ECTON. I yield. Mr. LANGER. Is it not true that the Government has built the dam at Fort Peck at its own expense? Mr. ECTON. Yes. That is all right; I do not object. Mr. LANGER. Why should the Mon- tana Power Co. or any other power com- pany buy that power, getting it from a dam built by the people, and sell it at @ profit to farmers and others who pay taxes? Mr. ECTON. I do not know whether it is sold at a profit. If the Government does not make a profit at 5.5 mills, I do not sce how if can be argued that the company makes a profit. Mr. LANGER. Docs the Senator maintain that, if the Government pays $100,000,000 to build a dam, it would not be appropriate for the Government to spend an additional $1,000,000 or $2,- 000,000 to build a transmission line for the purpose of delivering the power to the farmer at cost? Mr. ECTON. No, the Government is getting entirely out of its sphere and be- yond its prerogative. I ‘elieve the Gov- ernment should do only those things which individuals or private companies are not able to do. Let the Government build the dams, and then let private companies distribute the power and give the service, and pay the taxes. We must have taxes from some source. Mr. LANGER. If I correctly under- stand the Senator, he believes in the peo- ple furnishing the money to create the power, but when it comes to distributing the power, we should let private con- cerns distribute it at a profit. Mr. ECTON. Why not? If we find they are making too much money, let us tax them further. If we do not get taxes from them, where are we to get them? Are we merely to appropriate the money? Is that the way to get them? Mr. LANGER. I submit that when the Government builds a dam and cre- ates power and the farmers and busi- nessmen pay the entire cost of the proj- ect, they certainly should get the power distributed to them at cost. Mr. ECTON. They are getting it dis- tributed to them at cost. It costs the Government 5% mills now, and the power is going to be distributed at the rate of 544 mills by a private company which will build its own line. Why pay for a Government line? Mr. LANGER. How much does the Montana Power Co. pay the Government to get the power at Fort Peck? JULY 19 Mr. ECTON. Since it is not firm power, I imagine it gets the power for approximately 24 mills. Mr. LANGER. They charge the farm- ers twice as much as they pay for it at Fort Peck. Mr. ECTON. No. They do not get firm power; they get surplus power, They get the extra power which the Gov- ernment does not need at Fort Peck. Mr. LANGER. Mr. President, will the Senator yield further? Mr. ECTON. I yield. Mr. LANGER. Could not the Goy- ernment give the surplus power directly to the farmers at the rate of 242 mills per kilowatt? Mr. ECTON. I do not know. Maybe we shall reach the point where we will give it to them for nothing. I shall not take much more of the time of the Senate, Mr. President-— Mr. AIKEN. Mr. President, will the Senator yield? Mr. ECTON. I yield. Mr. AIKEN. Mr. President, it 1s amazing to someone from New England tc hear the Senator from North Dakota and the Senator from Montana argu- ing over whether 51!4-mill power is too high. If they lived in New England or in the State of New York, where the minimum price is at least twice 514 mills, they might better realize the value of competition in the power industry. Mr. ECTON. I thank the Senator from Vermont. Mr. AIKEN. Whether the power comes from public or private sources, both Senators are very fortunate to be even able to talk about 5!4-mill power. Mr. ECTON. I think so, too, because I know many people have to pay 20 cents and other people complain about 5% mills. What do they want? Shall we hand it to them on a silver platter? On April 20, 1950, J. E. Corette, Jr., testified before the Senate Subcommit- tee on Interior Department Appropria- tions, explaining the 5.5-mill rate avail- able to REA cooperatives, pointing out that capacity has been doubled on com- pany transmission lines serving the Hill County REA and reiterating the com- pany offer to double capacity to the Marias REA. This should eliminate any argument that the cooperatives cannot have all the electricity they want. Up to April 20, the same date on which Mr. Corette, vice president of the Montana Power Co., appeared before the committee, I understand no work had been done on the Havre-Shelby line, except that some of the right-of-way had been purchased and some ease- ments had been filed. ; During Mr. Corette’s testimony before the Senate subcommittee H. F. McPhail, of the Bureau of Reclamation, stated the situation. The Senator from Arizona (Mr, Haypen] asked: What is the status of that line? Mr. McPhail replied: The status of that line is that the contract has been let, The contractor has been ac- cumulating his materials. * * * The ac- tual notice to proceed was not given until
1950 the weather conditions had approeched a condition where the contractor could ac- tually get to work in the fleld. On May 19, 1950, Harold E. Aldrich, acting manager of the Bureau of Recla- mation, upper Missouri district, an- nounced that the Sm:th Construction Co. had started work on the Havre- Shelby line in April and that it expected to complete its part of the work by September 6. Aldrich said contracts for substations at Shelby and Rudyard were still to be awarded and that bids were expected in July, So, Mr. President, every effort was made to shove this contract along and get it underway, even after it was known that the rate had been reduced to the Government rate and there was a possi- bility of serving the cooperatives at the lowest possible rate the Government could offer. The Senate’s policy that no money should be spent for Federal transmission lines if arrangements could be made to get the power to the people was reafflrmed last April during the hearings. On April 20 Mr. Corette, vice president of the Montana Power Co., stated: Money was appropriated for the Havre- Shelby line last year, We thought it was with the definite understanding in light of your statement, Senator Haypen, that it would not be spent if a wheeling agreement could be made and these REA’s could be sup- plied at the Bureau of Reclamation rate. The Senator from Arizona (Mr, Hay- DEN] replied: That was my understanding. Mr. Corette then said: But in December we read in the paper that a contract had been let for the transmission lines and we now read that a contract has been let for some of the substations. The Senator from Arizona asked Mr. McPhail, of the Bureau of Reclamation, this question. What is the necessity for the Havre-Shelby line under these circumstances? Mr. McPhail replied: Unquestionably, the necessity would be re- duced to some extent However, I don't know what the reaction of the REA’s that are di- rectly affected may be. We have heard no word from them since this rate announce- ment. SoI have not had . ny idea as to what the Ilccal reaction might be. Mr. President, that is from the Senate subcommittee hearings, part I, page 1416. Mr. President, I again submit that if the Bureau of Reclamation had read the report and what took place on the floor of the Senate as recorded in the ConGrEs- SIONAL REcoRD all this confusion might have been eliminated. Up to this time the Montana Power Co. has offered to take all the materials which have been placed in the project off the hands of the Government at cost, so the Government will not lose any money. Mr. President, I have a few telegrams which I have received from labor unions. There are many labor unions in Montana which have been much concerned over the building of this particular line. As early as last December they read in the newspapers that the Bureau was contem- CONGRESSIONAL RECORD—SENATE plating letting the contract, and after the contract has been let I received com- munications from labor unions in Mon- tana protesting the letting of the con- tract on the ground that it was unfair to organized labor in the State. ¥ ask unanimous consent to insert these telegrams in the Recorp. They come from labor unions in Montana. I ask that they be inserted in the Recorp at the conclusion of my remarks. The PRESIDING OFFICER. Is there objection? The Chair hears none, and it is so ordered. (See exhibit 1.) Mr. ECTON. In that connection I ask unanimous consent that the policy as set forth by D. W. Tracy, international president of the International Brother- hood of Electrical Workers, be inserted in the Recorp at the conclusion of my re- marks. The PRESIDING OFFICER. Is there ubjection? The Chair hears none, and it is so ordered. (See exhibit 2.) Mr ECTON. Also, Mr. President, I ask that there be printed at the conclu- sion of my remarks a news release is- sued by the International Brotherhood of Electrical Workers, dated May 25, 1950, in substantiation of the statement made by their president, Mr. Tracy. The PRESIDING OFFICER. Is there objection? The Chair hears none, and it is so ordered. (See exhibit 3.) Mr. ECTON. Mr. President, I thank the distinguished Senator from Arizona for his untiring efforts to live up to the policy which was clearly stated last year on the floor of the Senate. I believe that the recommendations of the Senate com- mittee should be sustained. ExuHIsiT 1 Great Fars, July 12, 1950. Hon. Z. N Ecron, Washington, D.C: Local 122, International Brotherhood of Electrical Workers, vigorously protest the re- allotment of any funds for the construction of the Havre-Shelby power line. R.C STANICH, Sccretary. LEWISTOWN, Mont., July 12, 1950. Senator Zatrs Ecron, Senate Office Burlding, Washington, D.C.: We fee) that the Havre-Shelby area is now adequately served by the Montana Power Co, We urge you to oppose restoration of funds for construction of the Havre-Shelby elec- tric power transmission line, Stand behind Senate appropriation committee decision. INTERNATIONAL BROTHERHOOD OF ELecrricaL Workers, Locan No. 652, Py A. D. Epwarps. MISSOULA, Mont., July 12, 1950. Senator ZaLes EcTON, Washington, D.C: The Montana State Council of Electrical Workers composed of the 17 Montana IBEW unions have instructed this office to vig- orously protest any appropriation of funds for the construction of the Havre-Shelby transmission line under the present cir- cumstances. The contract has been let to the Smith High-Line Construction Co., of Tennessee, notoriously unfair to organized or unorganized labor. His methods of opera- tion are to the utter detriment of Montana 10613 labor; that this contractor has no intention of hiring Montana labor is shown by the thirty-odd Negroes tmported from Tennessee that are at present at the site of the job. This has forced our electricians to seek em- ployment outside of the State of Montana in Ydaho and Washington where conditions like those in Montana are not tolerated. We are aware of the Davis-Bacon Act but due to the fact that classifications are not included in this act the contractor will not hire our skilled craftamen. The Montana State Council of Electrical Workers has no desire to impede progress but if Government power projects are to be built and maintained on cheap and unfair labor as proposed in this case of what benefit is this to the workmen of Montana; the pres- ent Montana utilities use Montana labor; pay a fair living wage, and sign and maintain the provisions of work to the mutual benefit of utilities and Montana labor. If you are friends of organized labor you will do all in your power to prevent this ap- propriation and help your Montana citizens maintain their standard of Hving. MONTANA STATE COUNCIL OF ELECTRICAL WORKERS, Grorcr W. S8cotTr, Secretary-Treasurer, Haver, Mont, July 13, 1950. Hon Zares N Ecron, Senate Office Building, Washington, D.C.: We don't need duplication of power lines, Public power advocates are throwing away the taxpayers’ money Support the Senate Appropriation Committee's decision to refuse funds for the Havro-Shelby line. H. Eari Cuack Co., L B. Wicmore, Sales Manager. Havne, Mont, July 13, 1950. Hon ZAues N. EcTon, Senate Office Building, Washington, D.C.: Please use your influence and position to seo that funds for unneeded transmission lines such as the Canyon Ferry-Great Falls and the Havre-Shelby line be denied. RUNKEL Bros. —_ Exurerr 2 INTERNATIONAL BROTHERHOCD OF ELECTRICAL WORKERS, Washington, D. C., March 27, 1950. Mr. Wiuttrsm C WISE, Acting Admintstrator, Rural Electrifi- cation Administration, Department of Agriculture, Washington, D. C. Dear Mr. Wise: I am hereby entering an urgent protest on behalf of the International Brotherhood of Electrical Workers (AFL) against the latest developments in the anti- union policy of the Rural Electrification Administration. The International Brotherhood of Electri- cal Workers (AFL) which represents more than 75 percent of the unionized workers in the electric light and power industry, both private and public, has been shocked and surprised at the antilabor actions of the Rural Electrification Administration. These actions are all the more grievous because they strike at organized labor which partict- pated in the effort to bring the Rural Elec- trification Administration into existence, Labor was a staunch supporter of the pro- posal to establish the Rural Electrification Administration because it believed that the Administration as originally set up would function in the public interest. We now find that the Rural Electrification Adminis- tration has taken such a narrow and back- ward view of its responsibilities and duties that it is bringing serious harm to the im- portant section of the public interest repre- sented by labor.
10614 On December 17, 1949, an international representative of the International Brother- hood of Electrical Workers (AFI) wrote the Montana State Water Conservation Board a letter setting forth the facts that the Inter- national Brotherhood of Electrical Workers (AFL) had entered into bona fide collective bargaining agreements with seven Rural Electrification Administration cooperatives in Montana and such agreements included a clause guaranteeing that work let by con- tract would be performed under Interna- tional Brotherhood of Electrical Workers (AFL) union conditions. The international representative of the International Brother- hood of Electrical Workers (AFL) suggested to the Montana State Water Conservation Board that it would be in the interest of pre- venting confusion iy the proper authorities would notify contractors that the coopera- tives are under union agreement when the invitation to bid is sent out. This letter was forwarded by the State water conservation board to the Rural Electrification Adminis- tration in Washington for comment. On March 6, 1950, you, as Acting Administrator of the Rural Electrification Administration, replied to the State Water Conservation Board of Montana and forwarded a copy of your letter to me in my capacity of inter- national president of the International Brotherhood of Electrical Workers (AFL). Your letter pays lip service to the mainte- nance of a policy of good labor relations and concedes the legality of the union clause in REA cooperatives bargaining agreements. You then go on to throw the entire weight of the administrative discretion of the Rural Electrification Administration against the actual operation of the union clause. You Bay: “While, as I stated, it is satisfactory to the REA for its borrowers to include any legal provision in the construction contract relat- ing to labor problems, itt should be pointed out that any provision in a contract which has the effect of preventing free competitive bidding may well result in a cost of construc- tion to the borrower which will make it im- possible for us to approve the award of the bid, due to the effect of high cost upon the feasibility of our loan. We, of course, have to scrutinize all awards most carefully to make certain that the cost of construction will not be so excessive as to endanger the repayment of a loan. This is espectally true in areas in which the Montana borrowers operate, where the consumer density ts low, and all possible savings have to be effected in order to make the project feasible from a financial standpoint. It should be pointed out that we cannot approve awards of a bid in the event that the number of bidders is so low as to not constitute true competi- Uve bidding. The possibility of this danger always exists whenever any kind of restric- tive provisions are inserted in the construc- tion contract.” The REA policy, as stated in your letter, is in complete contradiction of the policy of promoting and advancing labor standards through union agreements. Your empha- sis on the matter of “high cost" as a reason for opposing labor standards established by union agreements and in favoring lower ‘wages paid by nonunion contractors, is a throw-back to the days of the “sweat shop” employer who justified his position on the ground that he sold his products to the consumer at & cost lower than the cost of legitimate unton employers. The REA 1s mot advancing sound public policy when tt e@eeks to develop a financial record for itself at the expense of the men and women whose work ts essential to the bringing of electricity to the farms. I am in complete accord with all efforts to secure a sotind and economic expenditure of Government funds which are drawn from the taxes paid by all parts of the population, including labor. I would respectifully recom. CONGRESSIONAL RECORD—SENATE ment, however, that the REA would do better, if it were to begin to apply itself to the task of increasing efficiency in the management of cooperatives and reducing its own high administrative expenses rather than to con- tinue its present policy of destroying union conditions of labor. In this connection, I have noted with interest the report of the House Committee on Appropriations in ex- planation of the appropriation bill for the several branches of the Government for the fiscal year ending June 30, 1961. (81st Cong. 2nd Sess. Report No. 17973, p. 140). The Committee approved a total of 8,150,000 for the administrative expenses of the Rural Electrification Administration during 1951, No criticlsm was offered in the report with respect to wages paid to the working men and women who perform useful services for the cooperatives and their members. The committee, however, did criticize the Rural Electrification Administration and its officers for exorbitant fee paid for engineering and legal work. The committee stated as fol- lows: “In the opinion of the committee (House Appropriations Committee), [fees paid for engineering and legal work in connection with the larger loans are too high]. It is be- lieved that such fees should not be estab- ished strictly on a percentage basis but maximum limits should be fixed which would in the cases pointed out to the com- mittee [reduce the fees paid substantially. These costs are passed on to the consumer.]” (Matter in brackets supplied.) (A reference is made an p. 1086 of the Hearings of the House Committee on Appropriations to an appendix including information requested on the above subject by the committee. The note in the hearings states that the appen- dix may be found at the end of the hearings but it appears that the appendix ts not available.) It is apparently a fact that the concern voiced in your letter on the ‘effect of union conditions on costs has not registered it- self with equal force in keeping down the exceasive fees for engineering and legal work, which have been criticized by the congres- sional Committee. Insofar as your statement on “free competi- tive bidding” is concerned, I wish to point out there is no Federal statutory requirement for such bidding on the part of such coop- eratives since the cooperatives are not agencies of the Federal Government. The cooperatives have the legal power to enter into the agreements which they have made for union conditions on contract work and I believe they should be applauded and not discouraged from entering into such agree- ments by a Government which ts committed to a policy of collective bargaining. Your letter is written in banking terms, The Rural Electrification Administration, however, is not a banking program. If tt were, there would be no need for Federal action in this fleld. Private money could be secured for development of the coopera- tives. The specially favorable terms of in- terest and amortization provided in the Rural Electrification Administration Act have been adopted by the Congress because it is deemed wise from the standpoint of the public interest to give assistance to the worthy cause of bringing electricity to the farms. It ill behooves the Government off- cers engaged in the administration of this public policy program to close their eyes to this fact and refuse to give consideration to the needs of labor for proper labor stand- ards. Your letter is a far cry from the policy of the Rural Electrification Administration as stated in its memorandum of understand- ing with the International Brotherhood of Electrical Workers (AFL) entered into Au- gust 4, 1941, which provides that "The REA agrees to promulgate a list of labor stand- ards embodying the spirit and letter of this general policy [and assumes the obligation JULY 19 of winning REA cooperatives to the accept- ance of these labor standards ].” I have commented fully on the status of this understanding and the failure of the Government to implement its general state- ment of policy in a letter of February 2, 1950 to a State fact finding board of Minne- sota, copy of which was tranamitted to the Administrator of the Rural Electrification Administration. Today we find the REA, in the case of the Montana cooperatives, not only refusing to assume its obligation of winning REA cooperatives to the acceptance of labor standards but, on the contrary, do- ing ite utmost within the Mmits of its power to win such cooperatives away from those labor standards which the REA cooperatives themselves are willing to adopt pursuant to collective bargaining agreements with the International Brotherhood of Electrical Workers (AFL). The time has come to look through slogans and fine words to the actual facts. The union clause which {s the subject of your letter of March 6, 1960, is not unusual. It is not a special favor the International Brotherhood of Electrical Workers (AFL) is seeking to secure from the REA coopera- tives—it is a standard clause in our agree- ments with private companies in the elec- tric light and power industry. We do not run into the complicated con- siderations set forth in your letter in secur- ing such clauses in our agreement with pri- vate companies nor in securing the good faith application of the clause. Labor 1s getting a fair deal from these private com- panies but we cannot secure equal treatment from the Rural Electrification Administra-" tion. This is an alarming fact which must become known to organized labor and all others concerned with the problem. The International Brotherhood of Elec- trical Workers (AFL) has patiently tried to secure relief from the antilabor policies of the Rural Electrification Administration by conferences and communications, I have become convinoed that the condition cannot be corrected through such means. I am, therefore, releasing this letter for public in- formation so that all fair-minded people may judge for themselves whether the labor policies of the Rural Electrification Admin- istration are in the public interest. Sincerely, D. W. Tracy, International President, Exursrr 3 Tue INTERNATIONAL Exxecurive CoUNCIL oF THE INTERNATIONAL BROTHERHOOD oF ELEC- TRICAL WORKERS ENDORSES THE ACTION AND Pouicy or INTERNATIONAL PResipent D. W. TRACY IN OPPOsING PvUBLIC-OWNERSHIP ‘TREND IN THE Evectaic Licur aNnp Powxr INDUSTRY In the interests of the commonweal there is no more pressing need than provision for flood control, trrigation, navigation, and the prevention of ecil erosion. By reason of geography and the topography of the land such provision and prevention is necessary and inescapably within the- reaim of Federal obligation. In the fulfillment of such obligation our Federal Government properly conceived the idea of utilizing hydropower for the pur- pose of generating electricity as a byproduct of soil conservation and irrigation. The In- ternational Brotherhood of Electrical Work- ers, AFL, heartily endorsed and diligently supported the idea. However, in the interval since the inaugu- ration of this program there have been devel- oped and instituted procedures engendered by a false concept of the fundamentals of Americanism. The Rural Electrification Administration was brought into being for the purpose of facilitating the transmission of electricity
1950 into rural sections. Under the Government power program, however, the facilitating in- tent has been substituted for by a plan an- volving what could well be and assumes ail the aspects of the first step in the evolution of governmental ownership of the genera- tion, transmission, and sale of electricity to the individual consumers. Under this pro- gram the operations of the Rural Electrifi- cation Administration combined with the functioning of the Bureau of Reclamation, Department of the Interior, and the Army engineers have extended the scope of the program to a point that threatens peril to legitimate free enterprise. The ecope of the program now embraces the generation of electricity by power other than that procured through irrigation and flood control, steam as an instance; the dis- tribution of electric power and the sale of electric power in direct competition with privately owned electric utility companies. The Rural Electrification Administration through its financing of cooperatives, has proceeced to the extent of using public mon- eys supplied by the taxpayers for the butld- ing of electric transmission lines parallel to existing privately owned distribution sys- tems. The progress of this procedure is such as to clearly indicate complete duplication of transmission facilities in competition that can only lead to extermination of private utility companies. Such complete exter- mination has been accomplished in the State of Tennessee and is rapidly approaching completion in the State of South Carolina and is making rapid progress in the State of Nebraska. In pursuing the above policy the Rural Electrification Administration has lowered the quality of work standards and ignored the rights of electrical workers to bargain collectively. The resulting situation 1s anomalous in- deed. In the first instance while the funda- mental policies of the Federal Governmeitt champion the rights of labor to organize and bargain collectively, the administration of the Rural Electrification completely ig- nores these rights of labor. In the second instance one branch of government is en- gaged in the prosecution of trusts and com- bines on the premise that the operation of such trusts is inimical to the commonweal. At the same time a department of the Gov- ¢ .ment is nurturing a governmental mo- nopoly of the generation, distribution, and sale of the greatest power man has mastered fc industrial production, home necessities, and public convenience. The International Brotherhood of Elec- trical Workers does not raise its voice on the subject of public power in behalf of private companies or their management. We have met the abuses of power by these companies in the past and have achieved substantial correction. Today 90 percent of the workers in the privately owned electric light and power Industry are covered by unlon con- tracts and the IBEW itself represents more than 75 percent of the organized employees in this industry. The International Brotherhood of Electri- cal Workers raises its voice on the subject of public power at this time in the interest of organized labor in the electric light and power industry. The subtle transformation of the Government program from the proper purposes ©; providing power as a byproduct of the initial program and of furnishing a yardstick for private utilities has reached the stage where it threatens free enterprise in this industry. We support free enter- prise not only in our capacity as citizene of tae United States but also in our capacity as representatives of organized labor. The increase in the area of government and quasi- government ownership operation in utilities necessarily carries with it a decrease in the area of freedom for labor os well as other groups. CONGRESSIONAL RECORD—SENATE Labor cherishes {ts right to bargain col- Jectively for wages, hours, and working con. ditions. It fights the abrogation of such rights whether in the form of antilakor laws or in the more complicated form of trans- ferring their status to omployces of the government without any rights to bargain collectively or otherwise exercise their eco- nomic strength. The International Brotherhood of Elec- trical Workers has had drastic experience with the effect on its interests resulting from the transfer of utilities from private to public or quasi-public ownership. In a recent case where the ownership of a& utility was transferred to a municipality the IBEW was deprived of collective bar- gaining rights by an order of the court evén though the majority of voters of the munici- pality had enacted an ordinance requtring their officials to bargain with the union. Labor does not choose to have its welfare determined by the administrative orders of government officials no matter how well ine tentioned they may purport to be. Under fascism, nazism, and communism the people work for the state. Under the policies inaugurated by the Rural Blectrifi- cation Administration those employed on electrical properties work for the govern- ment under the guise of cooperatives. It is a distinction without a <ifference. That the International Brotherhood of Electrical Workers has been cognizant of these developments for some time was indl- cated by its expressed concern in 1948, when its international president, D. W. Tracy, in an address before the members of the Edison Electric Institute, in the course of his re- marks, said: “I would not be talking heart to heart in a manner consistent with my expressed desire in my earlier remarks if I did not say: We need and must have more democ- racy in government and more democracy in business with less government interference in business and in labor. In an effort to prevent possible misunderstanding of my statement I emphasize the fact that the International Brotherhood of Electrical Workers endorses, advocates, and defends the profit system. Call it capitalism if you will but the fact remains the system is an ele« ment of Americanism because it is the eco- nomic system of our land and has contributed to the higher standard of living in this country which at once becomes the envy and the hope of common people in foreign lands.” ‘The International Executive Council of the International Brotherhood ‘of Electrical Workers today endorsed the action of Inter- national President Tracy and unanimously subscribed to this public release in defense of freedom of labor, in defense of freedom of legitimate enterprise, and in defense of freedom of cooperation between both to the benefit of the commonwealth through safe- guarding the elements of Americanism, against assault,. by authoritarian or state power on the liberties that have identified America as the country where labor has an effective voice in the establishment of con« ditions of its employment. Mr. CORDON. Mr. President, I wish merely to say that I am wholly familiar with the facts developed with reference to this particular matter, and I join the chairman of the subcommittee in urging the Senate to approve the action re- ported by the committee, The PRESIDING OFFICER. The question is on agreeing to the committee amendment on page 247, line 5. The amendment was agreed to. REDUCTION IN NONDEFENSE SPENDING— STATEMENT BY SENATOR BYRD Mr. BYRD. Mr. President, I ask unanimous consent to have printed in 10615 the Recorp a statement prepared by me dealing with reductions in nondefense spending. There being no objection, Mr. Byrp’s statement was ordered to be printed in the Recorp, as follows: Sratement sy Senator Harry F, Byrp I will support the President in all necessary eprpropriations for the military. I will sup- port reasonable and practical measures to control inflation. I am very much dieappointed that the newspepers today report that the President has requested the majority leader, Mr. Lucas, to oppose reductions in nondefense expendi- tures. The President should reulize that financial preparedness and the ability to pay are the source of all preparedness. With colossal new expenditures facing us, we can- not preserve our solvency unless we reduce in every possible way nondefense spending, In 1948 we expended more than $6,000,000,- 000 for domestic-cividan expenditures, ex- clusive of the military, of interest on the debt, veterans’ expenses, and foreign ald. The President now recommends about $12,- 060,000,000 for domestic, nondefense spend- ing. This represents an increase of about 100 percent within this period. I hope the President will reconsider his decision and cooperate with the Congress in reducing nondefense spending. The President says he will ask for $10,< 000,000,000 of additional military appropria- tions. It is significant that he used the term “appropriations” instead of authorizations. This means he expects actually to spend $10,000,000,000 additional in this fiscal year. If this is done the total expenditures will approximate 852,0C0,000,000 and, of course, further requests may be made, as the Presle dent has indicated. The highest estimate of income under the preceht revenue system, and allowing for in- creased prosperity, is about 840,000,000,000 for this fiscal year. This leaves a deficit of $12,000,000,000 without further requests. If we continue to add such sums to a pub- Nc debt now approeching $260,000,000,000, it will not be long until we go over the preci- pice of financtal disaster. GENERAL APPROPRIATIONS, 1951 The Senate resumed the consideration of the bill (H. R. 7786) making appro- priations for the support of the Gov- ernment for the fiscal year ending June 30, 1951, and for other purposes, Mr. HUMPHREY. Mr. President, on July 17 considerable discussion took place on the floor of the Senate between the Senator from Georgia [Mr. RussE.u] and the Senator from Alabama [Mr. Hiui] pertaining to the language in the committee report on the general appro- priation bill with reference to the Rural Electrification Administratiof. The lan- guage in the report which was discussed is as follows: The committee believes that no loan should be made for construction of such facilities unless in areas where private power companies cannot or will not furnish ade- quate power at reasonable rates and within a reasonable time. I have had a large number of calls in reference to this particular committee language. Also I have received a num-~ ber of telegrams and other communica- tions from persons in the farm areas in the State of Minnesota who are very much concerned over the application of this language as it would pertain to the rulings and decisions of the Administra- tor of REA. Therefore, Mr, President, I wish to state cn record my position on
10616 this issue, and also wish to incorporate into the Recorp some of the telegrams and messages which I have received from persons and organizations 1n my own State. The public law pertaining to REA has already been interpreted by precedent, tradition, and experience. I do not be- lieve that the language of the commit- tee’s report should in any way be con- trolling. It may be a statement on the part of the members of the Committee on Appropriations, but it does not repre- sent, at least up to this date, the consid- ered judgment of the Congress of the United States. The public law pertain- ing to REA was passed by the Congress, It had been considered by the Committee on Agriculture and Forestry. It has been debated at length for many years. The objectives of -REA legislation are clear and unmistakable. Any attempt in any way to thwart the efforts of the REA cooperative development should be strongly resisted and protested. I urge the conference committee on this bill to make it unmistakably clear that the Congress has no desire to impair the de- velopment of REA generation or trans- mission. I take that position and shall continue to maintain it. Mr. President, for example, I have a telegram from the president of the Bor- der Counties Power Corp., Warroad, Minn. This is one of the fine coopera- tives in our State. To quote just a few passages from the telegram, I should like to read the following: Language in Senate report on general ap- propriations bill for 1951 could be very detri- mental! to Rural Electrification Administra- tion especially to generating and transmis- sion cooperatives, and could impose restric- tions on authority of REA Administrator which would be damaging to entire program, Toward the end of the telegram ap- pears the following: In our opinion this is very loose language and we urge that you work against this proposed change. Mr. President, I ask that the telegram be printed in the body of the Recorp at this point in my remarks. There being no objection, the telegram was ordered to be printed in the Recorp as follows: Warroad, MINN,, July 14, 1950. Hon. Husrrt H, Hompnrey, Untted States Senator from Minnesota, Senate Office Building, Washington, D. C.: Language in Senate report on general ap- propriations bill for 1951 could be very detri- mental to Rural Electrification Administrae tion especially to generating and transmis- gion cooperatives, and could impose restric- tions on authority of REA Administrator which would be damaging to entire program. We object to the following proposed ijan- guage. “The committee believes that no loan should be made for construction of such facilities unless in areas where private power companies cannot or will not furnish ade- quate power at reasonable rates and within & reasonable time.” In our opinion this is very loose language and we urge that you work against this proposed change. NorkMan CLEMENTSON, President, Border Counties Power Carp., ine. Mr. HUMPHREY. Mr. President, i also have a telegram from Mr, E. L. Smith. president. anc A. E. Lee, secre- CONGRESSIONAL RECORD—SENATE tary, Western Minnesota Power Cooper- ative. I ask that it be printed in the body of the Recorp at this point In my remarks. There being no objection, the tele- gram was ordered to be printed in the Record, as follows: Benson, Minn., July 16, 1950. Senator Hunger H. HUMPHREY, Senate Office Building, Washington, D. C.: We seriously object to portion of Senate Appropriations Committee report on H. R. 7785. whereby they recommend restrictions of REA loans for construction of generation- transmission facilities. Can see no justifi- cation either moral or economic for strength- ening position of private power companies and weakening position of farmers coopera- tive in power supply matter. Please do every- thing possible to exclude any language from omnibus appropriations bill that will re- strict generation-transmission loans to co- operative or weaken Administration’s au- thority to make such loans. E. L, Suarrx, President, A. E. Lex, Secretary, Western Minnesota Power Cooperative. Mr. HUMPHREY. Mr. President, I have a telegram from the directors of the Carlton County Cooperative Power Association, signed by C. W. Mak}, sec- retary, which I ask to have incorporated in the Recorp at this point. There being no objection, the telegram was ordered to be printed in the Recorp, as follows: Moose Lake, Minn., July 17, 1950. Senator HUMPHREY, Washington, D. C.: We request you do everything within your power to remove restrictive language in 8en- ate committee report on the appropriations bill for 1951 that might be interpreted to restrict or stop granting of generation or transmission loans. C. W. Maxt, Secretary, Board of Directors, Carl- ton County Co-op Power Assoct- ation. Mr. HUMPHREY. Mr. President, I have a similar message from the Minne- sota Valley Cooperative Light and Power Association, of Montevideo, Minn. I ask that it be ‘printed in the Recorp at this point in my remarks. There being no objection, the tele- gram was ordered to be printed in the ReEcorpD, as follows: MONTEVIDEO, MINN., July 17, 1950. Senator Huserr HUMPHREY, Senate Chambers, Washington, D. C.: May we have your suppojt for the generat. ing and transmission bill giving the REA administrator authority to make such loans, MinwesorTa VaLLey Coorpgrative Licot AND PoWER ASSOCIATION. Mr. HUMPHREY. Mr. President, I have a telegram from the president of the Minnkota Power Cooperative, from Grand Forks, N. Dak., which I ask to have printed in the Rrcorp at this point in my remarks. There being no objection, the tele- gram was ordered to be printed in the Recorp, as follows: Granp Forxs, N. Dak., July 14, 1950. Senator HumpHrcy, Washington, D.C.: Language in the Senate report on general appropriations bill for 1951 regarding con- struction of REA generating facilities should be clarified so as not to hinder program, Will you please do what you can to avoid JULY 19 the inclusion of any unnecessary provision which might hinder or hamstring the Ad- ministrator. Vicror M. Epsan, President, Minnkota Power Cooperative. Mr. HUMPHREY. Mr. President, I have a telegram from Roy E. Wiseth, president of the Minnesota Farmers Union, which I ask to have incorporated in the Recorp at this point in my re- marks, There being no objection, the telegram was ordered to be printed in the Recorp, as follows: Wiitmar, MrInn., July 3, 1950. Senator Huszar HumMpnHrey, Senate Office Butlding, Washington, D.C.? We must have public transmission Hnes to safeguard Government investments in REA cooperatives. Urge you to oppose appropria= tion cuts for transmission lnes. Roy E. WIsEtn, President, Minnesota Farmers Union. Mr. HUMPHREY. Mr. President, I have a letier from Mr. Victor Hanson, manager, Agra Lite Cooperative, Benson, Minn. I wish to read two paragraphs of the letter, because I think it is quite pertinent: From sad experience we know what the private power monopolists mean when they talk about adequate power supplies and reasonable rates. We have found that they actually mean inadequate supplies and un- reasonable rates. We cannot think of a single good reason why the farmers of America, through their REA cooperatives, should be further hamp- ered by legislation in their long battle to obtain electric power in adequate supply, and at cost of production. They have de- veloped their own loads, and have every right to serve those loads if they wish to do so. To deny them that right, by whatever means that may be used, would be rank in- justice. Mr. President, I ask that the letter be incorporated in the body of the Recorp at this point in my remarks. There being no objection, the letter was ordered to be printed in the Recorp, as follows: Aora Lire Coorrrarrve, Benson, Minn., July 17, 1950. Senator Husrerr H. HUMPHREY, United States Senate, Washington, D. C. Dear SENATOR HUMPHREY: The attempt to restrict use of REA loan funds for develop- ment of generation-transmission facilities as proposed in the Senate committee's report on the appropriations bill for 1951 is of vital concern to our cooperative. From sad experience we know what the private power monopolists mean when they talk about adequate power supplies and reasonable rates. We have found that they actually mean tnadequate supplies and un- reasonable rates. We cannot think of a single good reason why the farmers of America, through their REA cooperatives, should be further hamp- ered by legislation in their long battle to obtain electric power in adequate supply, and at cost of production. They have de- veloped their own loads, and have every right to serve those loads if they wish to do so. To deny them that right, by what- ever means that may be used, would be rank injustice. Please use your influence and vote in the Benate to defeat the present attempt to hamstring the REA GT program. Bincerely yours, Vicror Hanson, Manager,
1950 Mr. HUMPHREY. Mr. President, I should like to call to the attention of the Senate the fact that a recent survey of power development in this country indi- cates that the Federal power projects have in no way thwarted or injured the development of private power facilities. In fact, the tempo at present is one of increase in private power facilities as compared to public power. A tremen- dous investment of money is going into this fleld. It is a lucrative investment. I think proper tribute should be paid to the private companies who make power available at proper and reasonable rates. I do fecl, however, that the facts today set aside all these spurious and propa- ganda charges that somehow or other the activities of the Federal Government are threatening the private investment field and private activity within the field of generation of electric power and its transmission. The facts are crystal clear that nothing like that has happened. In fact, private companies are expanding their kilowatt- hour capacity at an ever-increasing rate. The Government is engaged in power projects in areas where private -facilities are not available, or where power is not adequately available. Finally, no matter how much power we develop we shall al- ways have too little. Let us make it quite clear, as we mobilize the Nation for national defense that this is no time to say that we are developing too much power or spending too much in public funds for it. Recently, I heard the Sec- reiary of the Interior testify before the committee headed by the distin- eu'shed Senator from Wyoming I[Mr. O’ManoneEy]. He said that in 1939 we had a 40-percent power reserve. Jn 1950 we have a 15-percent power reserve. We have had a loss of power reserve of 25 percent in a period of a little more than 10 years, and at a time when we are look- ing forward to a great national defense program. The President’s message is be- fore us. In it he asks for increased pro- duction and asks our country to turn out unprecedented quantities of materials in order io maintain our domestic, civilian, and international commitments. Mr. President, I ask unanimous con- sent to have printed in the Recorp, at this point in my remarks, an article en- titled ‘Private Utilities Step Out Ahead,” printed in the June 30, 1950, issue of United States News and World Report. There being no objection, the article was ordered to be printed in the REecorp, as follows: Private Urinitres Strep Our AHEAD—SPENDING 3 FOR PLANT TO Ever¥ Pupiic DoLLaR Federal power projects, growing fast, still lag far behind private producers. Expansion programs are booming. Private firms are outspending Government 3 to 1 in the race to keep up with electric- power demand. They still furnish most of the juice for industry. Final decision in issue of private versus public power is not in sight. But private companies, now, are holding their own. Private utilities, once the scapegoats of the New Deal, are in the midst of a vast program of expansion. Private power, as a result, is at least holding its own in the continuing struggle with public power for a market that is expanding by leaps and boundse CONGRESSIONAL RECORD—SENATE The flow of money from Federal, State, and local governmcnts into power development and distribution is breaking all records. Yet the flow of private capital into the power industry {s running far ahead of investment of Government capital. The ratio is about 8 to 1, with 83 of private capital going into modernization and expansion for each Government dollar. A demand that appears insatiable lies back of the booming expansion of power re- sources. That demand, on basis of conclue sions reached both by private utility man- agers and by Government planners, is ex- pected to double electric-power requirements during the 10 years ahead. In the contest to gain and hold this market, the private utilitics are maintaining their position rela- tive to governments, after losing—rela- tively—during the 1930's. Expansion records show what is hap- pening. In generating capacity, privately owned utility companies are making much larger increases than publicly owned systems. The chart on page 37 tells this story. Private utilities’ gencrating capacity in 1951 is to reach 61,C00,000 kilowatts, on basis of pres- ent plans, That will be 20,700,000 more kilo- watts than these companies had tn 1945, or & 50-percent increase in capacity. Public power agencies, in contrast, will add only 5,200,000 kilowatts of new capacity by 1951, in their postwar building program. This means that during the early postwar pe- riod, at least, the share of United States electric power in Government hands 1g re- maining the same, instead of increasing as in prior years. In 1920, Government systems controlled & percent of the power supply. By 1940, they had 14 percent, By 1945, their share was up to 20 percent, but it has not inéFéased since then. Spending totals, for new plant and equlp- ment, also point up the trends in power de- velopment. Spending figures are illustrated by the chart on this page. It shows private companies’ investment of about $8,050,000,- 000 in new generators, transmission lines, other facilities in the 1945-50 period. Fed- eral expenditures by unofficial estimate, amount to about $1,597,000,000 in this same period. Cities, States, other power units in- vested around §1,500,000,000 during these years. In other words, electric-power companies are building new plants, putting up lines about three times as fast as all the city, State and Federal agencies combined. That is the natlonal, over-all picture, and it is encourag- ing to advocates of private power. The situ- ation and future outlook are entirely dif- ferent in some areas. This shows up from a closer look at power programs around the country, Northern United States, from Illinois to the Atlantic, is the scene of the greatest build- ing activity in power. Industrial States of this region are demanding and getting about $1,000,000,000 worth of new facilities a year. Around half of the dollars are being spent in five North Central States—Ohio, Indiana, Illinois, Michigan and Wisconsin. About a third of the money goes into increased power for New York, New Jersey and Pennsylvania; the remainder to New England plants, Private utility companies account for nearly all the expansion. Federal activity is at a minimum in this area. Major work centers on steam plants, using coal and oil for fuel, These modern plants are marvels of engineering. They are chang- ing old ideas about practical limits on size of steam units. Some newer ones rival the immense hydroelectric projects of the West, An example is the new plant opened at Sunbury, Pa., by the Pennsylvania Power & Light Co. It 1s one of the largest coal-fired power plants in the world, First units will have 250,000 kilowatts’ capacity when com- 10617 pleted. The plant can be enlarged later to 650,000 kilowatts, half the total for Hoover Dam. This hints at the scale of things in the power industry that private companies are creating. The South also fs getting enormous new blocks of power from private-utility build- ing programs. Outside the TVA region, pri- vato companies provide virtually all the electric energy. They are spending in the neighborhood of §$350,0C0,000 this yoar in the South Atlantic States, along the coact from Delaware to Florida, and In Kentucky, Mississippi, Alabama, and Tennessee. One item in this year’s schedules: Around 56,000 miles of new transmission lines. Federal activities are growing in this re- gion, however. TVA construction cxpendl- tures tn 1950 are at a record level. TVA gets 85 percent of its power from hydro- electric plants now. Two additional steam plants are under way, and, by 1953, around 30 percent of TVA power will be supplied by steam. A new Federal agency, the Southeast Power Administration, is setting up shop in the South, also. It will sell the power generat- ed at Federal dams that are built outside TVA's domain. Now, SEPA has only two projects going, with 72,000 kilowatts capac- ity. Plans are under way for other projecis that will bring SEPA capacity to 3,000,000 kilowatts. Interlor Department estimates that SEPA will be marketing one-tenth of all the power produced in Southeastern United States within a few years. West of the Mississippi, utility-company expansion goes foiward in every area except Nebraska, the one State where all power has been taken over by public agencies. Pri- vate Investment will approach §&250,000,0C0 this year in six North Central States—North Dakota, South Dakota, Minnesota, Iowa, Kan- sas, and Missouri. Much of the money will go for additions to steam power plants, Farther South, in Arkansas, Oklahoma, Louisiana, and Texas, utilities are spending about the same amount, building 4,500 miles of transmission lines plus substations and power generators. Here federally financed co-ops are setting up very extensive net- works of transmission lines that will come pete with private companies. Far western utilities carry on a Jarger building program than is generally realizcd. In 1950 they are spending more than $300,- 000,000 in Washington, Oregon and Califor- nia, Pacific Gas & Electric Co., in California, is doing more construction than any other utility company in the Nation. It has spent more than half a billion dollars, provided 850,000 kilowatts of capacity since 1944. In 1950 and 1951, this one company will spend another $200,000,000 and add 450,000 kuilo- watts to the West's power supply. : Washington and Oregon utilities are ac- tive, too, though most of the power thero eventually is to be produced in Fedcral proj- ects on the Columbia River. Power supplics, as a result of these vast expansion cfiorts, improved markedly during 1949. The Nation's reserve margin—percent- age of power available above peak londs——- moved up from 6.6 percent at the end of 1948 to 14.2 percent at the end of 1949. That is consiclered adequate, except in isolatcd re- gions where power can't be borrowed quickly from neighhboring sources in emergenc'es. Threat of power shortages in most parts of the country is removed, in consequence, for the first time in many years. A pro- longed drought can cause troubles whore water power is the main source. In most places, business and residential custcmers need not fear brownouts or other restrictions this year. The Pacific Northwest still rations industries, but that 1s the only aren of shortage. Rises in demand are phenomenal. Resi- dential use averaged 897 kilowatt-hours in
10618 1939, was up to 1,655 in 1949. Industrial load rose 22 percent in the last 8 years; farm load, 81 percent. There isn’t any end in sight. Just a few of the things forcing electricity’s use upward ere frozen-f00d lockers, clothes dryers, tele- vision sets, electric bed coverings, air condi- tioners, air cleaners, automatic soft-drink dispensers, electric stairways, thousands of new power-driven machine tools, and electri- cal implements on farms. Forecasts agree on a need for at least 120,000,000 kilowatts capacity by 1961. This means doubling the size of the generating plant—building 60,000,000 kilowatts of new capacKty—in the next decade. The issue is how much of this vast new industry will be built and controlled by private companies, how much by Government groups. The pri- vate uutilities feel they have made some gains on their competitors, but they know the struggle for leadership is only starting. Mr. HUMPHREY. This is a time when we ought to recognize that no mat- ter what we do, it will not be enough, and surely Congress should not be guilty of “too little and too late.” So I surely support the program for the project de- veloped along the lines suggested. Mr. DOUGLAS. Mr. President, I move that the Senate at an appropriate time reconsider the action by which it ap- proved committee amendments on the following pages and lines: Page 188, line 6; page 195, line 1; page 197, line 14; page 208, line 20; page 212, line 6; page 223, line 17. The PRESIDING OFFICER. The Senator from Illinois moves that the Senate reconsider its action on certain amendments enumerated by him. The motion will be entered. The clerk will state the next amend- ment of the committee. The next amendment was, on page 247, in line 5, after the word “which”, to strike out “$22,897,700” and insert “$25,- 185,700”. The amendment was agreed to. The next amendment was, on page 247, in line 6, after the word “fund”, to insert “and in addition thereto the Com- missioner of Reclamation is hereby au- thorized to incur obligations and enter into contracts for additional work, ma- terials, and equipment in an amount not exceeding $3,000,000 for power trans- mission lines and substations in the fiscal year 1951;”". The amendment was agreed to. The next amendment was, on page 247, fn line 19, after the word “fund”, to strike out the colon and the following proviso: Provided, That $1,000,000 of the funds provided in this paragraph for the construc- tion of transmission lines in South Dakota shall be available only for connecting the load centers of Armour with Watertown via Sioux Falls, and of Midland with Rapid City, and of Winner with Randall Dam. And to insert: Provided further, That $8,000,000 of the funds provided in this paragraph plus 83,- 000,000 contract authority shall be available for construction of transmission lines and substations in South Dakota, to include a transmission loop from Fort Randall through the load centers of Armour, Huron, Aberdeen, Andover, Watertown, Brookings, Sioux Falls, and Gavins Point to Fort Randall, and lines from Fort Randall to Winner and from Rapid City to Midland. CONGRESSIONAL RECORD—SENATE Mr. WILLIAMS. Mr. President, some Senators wanted to speak on some of these amendments, and did not know that we were to continue the session, If we are to continue longer, I shall suggest the absence of a quorum. Mr. LUCAS. I ask the Senator to withhold the suggestion. I am going to change signals in the middle of the stream. Mr. WILLIAMS. I withhold the sug- gestion, EXECUTIVE SESSION Mr. LUCAS. I move that the Senate proceed to the consideration of execu- tive business. The motion was agreed to; and the Senate proceeded to the consideration of executive business. EXECUTIVE MESSAGE REFERRED The PRESIDING OFFICER (Mr. Macnvuson in the chair) laid before the Senate a message from the President of the United States withdrawing the nomination of LuElla M. Thompson, to be postmaster at Darwin, Calif., which was ordered to lie on the table. The PRESIDING OFFICER. Reports of committees are in order. If there be no reports, the clerk will proceed to state the nominations on the calendar. BOARD OF DIRECTORS OF THE EXPORT- IMPORT BANK The PRESIDING OFFICER. The clerk will state the first nomination. The legislative clerk read the nomina- tion of Hawthorne Arey to be member of the Board of Directors of the Ex- port-Import Bank of Washington, for a term of 5 years. The PRESIDING OFFICER. The question is, Will the Senate advise and consent to this nomination? Mr. MORSE. Mr. President, at the opening of my remarks, I ask consent that the nominations to the Board of Di- rectors of the Export-Import Bank be considered en bloc. The PRESIDING OFFICER. Is there objection? The Chair hears none, and the nominations will be considered en bloc. The Export-Import Bank nominations considered en bloc are as follows: Haw- thorne Arey, of Nebraska; Herbert E. Gaston, of New York; Clarence E. Gauss, of Connecticut; Lynn U. Stambaugh, of North Dakota; to be members of the Board of Directors for term of 5 years expiring June 30, 1955. Mr. MORSE. Mr. President, I wish to report that this afternoon the junior Senator from Oregon met with the Com- mittee on Banking and Currency, in ac- cordance with the understanding which was reached in the Senate last night, in respect to the relationship of these nominations to certain loaning policies of the Export-Import Bank which the junior Senator from Oregon wished to discuss with the committee. I desire to say that the junior Senator from Oregon received from the mem- bers of the committee a very fair and courteous hearing, as he knew he would once he appeared before the committee. He said then, and he wants to repeat on the floor of the Senate, that he cer- JULY 19 tainly appreciates the consideration and courtesy extended to him by the chair- man of the committee, the Senator from South Carolina [Mr. MAyBanx], in mak- ing possible the discussion that took place in the committee hearing this afternoon. At the hearing the junior Senator from Oregon raised certain objections to cer- tain of the loaning policies of the Ex- port-Import Bank, as he understands those policies to be. He made special reference to the Argentine loan, which he thinks is deserving of a most careful investigation by the Banking and Cur- rency Committee, and he made reference to certain loans which, up to date at least, have been denied by the Export- Import Bank, which he thought should be inquired into in order to determine just what the policies of the bank are. However, he made clear before the committee that he is satisfied that the individual nominees now before the Sen- ate are men of fine character. There can be no question as to their integrity or their honesty or their devotion in carrying out their public duty in ac- cordanee with the policies they are called upon to exccute as members of the board of directors of the bank. It is not with the qualifications of the nominees that the junior Senator from Oregon has any quarrel or difference, but only in connection with the policies he thinks the members of the bank have been called upon to administer. There- fore, as he told the committee this after- noon, he intends at this time to vote for the confirmation of these nominees. He wishes to report to the Senate that the chairman of the committee, in the presence of the junior Senator from Ore- gon, took up with the Banking and Cur- rency Committee the request of the junior Senator from Oregon that there be an inquiry into the loaning policies and practices of the Export-Import Bank, and it was agreed that such an in- quiry should be held. Not only that, but the junior Senator from Oregon was told that it would not be necessary to press for the adoption of the resolution which he submitted on June 27 calling for such an inquiry, but that the committee would proceed with such an inquiry on its own initiative, which it has the power to do, and the resolution to that effect would not be necessary. I was satisfied, Mr. President, that all that was needed was just such a confer- ence as we had this afternoon, because I knew that the members of the com- mittee would want to join with the junior Senator from Oregon in finding out what the facts are. That is all I seek in re- gard to the policies of the Export-Import Bank, and if those facts disclose a need for a change in the policies of the bank, then I am sure necessary legislative ac- tion will be taken to bring about such a change. I now yield the floor. Mr. MAYBANK. Mr. President, I merely wish to say to the Senator from Oregon that it was a distinct pleasure for the committee to have him before it this afternoon. I assure him that we shall agk the questions he desired to be asked, in executive session, that we shall
1950 have replies, and that we shall conduct whatever investigation may be neces- sary in line with the provisions of the resolution submitted by the Senator from Oregon. Mr. MAGNUSON. Mr. President, I cannot let this occasion pass without expressing my feeling respecting two of the gentlemen whose nominations have been sent to the Senate and are on the Executive Calendar, to be directors of the Export-Import Bank, men whom I have known for a long time. The Sen- ator from North Dakota and I have been for many years acquainted with Mr. Lynn Stambaugh. In fact, I grew up with him. I have always considered him to be a man of good character, of high integrity, and of great ability. The same is true with respect to Mr. Herbert Gaston, whom I have known since child- hood, . I know not what their policies have been, except in a general way, but I hope that the situation which has arisen with respect to that subject will be worked out satisfactorily. I am sure that the chairman of the Committce on Banking and Currency and the Senator from Oregon can have a satisfactory discus- sion of the matter of policies. I was very pleased, however, to hear the junior Senator from Oregon say to- day that there was no question about the integrity or the ability or the energy of the two directors whom I know. I presume the other two are of the same high caliber. Mr. LEHMAN. Mr. President, I am very much gratified that the Senate is about to take action upon the nomina- tions of members of the Board of Direc- tors of the Export-Import Bank. I have had the privilege of Jong friendship with one of the Directors, Mr. Herbert Gas- ton. Mr. Gaston came into the service of the State of New York in 1931 as Sec- retary and later as deputy commissioner of the New York State Conservation De- partment. He then came to Washing- ton, where he filled many offices of re- sponsibility and importance, including that of Assistant Secretary of the Treas- ury, and later Director and Vice Chair- man, and then Chairman of the Export- Import Bank. I consider Herbert Gaston to be a man of the highest character. He is hard- working, of unquestioned loyalty, and of unimpeachable integrity. I have never heard a single word against his charac- ter. I know that he has rendered splen- did service to the people of his State and to the people of the Nation, and that he will continue to render similar service, if his nomination is confirmed by the Senate of the United States. Mr. LANGER. Mr. President, I join with the distinguished Senator from New York in expressing my high regard for Mr. Gaston. For many years he was editor of a newspaper in the State of North Dakota. He is a man of outstand- ing ability. He was one of the best edi- tors we have ever had in my State. He is considered to be absolutely honest. In my opinion, he has made a very good Chairman of the Export-Import Bank, I hope his nomination wil) be confirmed. The PRESIDING OFFICER (Mr. Hot- LAND in the chair). Tue question is on CONGRESSIONAL RECORD—SENATE the confirmation en bloc of Hawthorne Arey, of Nebraska; Herbert E. Gaston, of New York; Clarence E. Gauss, of Con- necticut; and Lynn U. Stambaugh, of North Dakota, to be members of the Board of Directors of the Export-Import Bank of Washington for the term of 5 years expiring June 30, 1955. The nominations were confirmed. UNITED STATES COURT OF APPEALS The legislative clerk read the nomina- tion of William Henry Hastie, of the Vir- gin Islands to be judge, United States Court of Appeals, Third Circuit. Mr. HENDRICKSON. Mr. President, I feel highly honored today to stand upon the floor of the Senate to speak a few inadequate words of commendation on behalf of the distinguished citizen of the United States whose name is now before us for confirmation. I take the liberty of infringing upon the time of this body for I have long numbered Wil- liam Henry Hastie as one of my close friends and associates. At the beginning of his remarkable career of public service, Mr. Hastie dedi- cated his outstanding talents to the youth of New Jersey by serving as a teacher at the Bordentown Industrial School in Bordentown, N. J. During his service at that fine institution he helped mold the characters of many of my fel- low citizens of my State and his host of friends from those days still are his heartiest admirers and most unselfish supporters. I hasten to associate my- self as both an admirer and a supporter. I wish to assure my colleagues in the Senate that I urge the forthright ap- proval of this nomination for I know that Judge Hastie possesses the char- ccter and the ability to serve with dis- tinction on the Third Circuit Court of Appeals serving my own State. This he has shown beyond question throughout his entire life, but particularly during his term as Federal district judge and as Governor of the Virgin Islands. But, Mr. President, there is even added merit for favorable action on this confirmation, for by such action we prove conclusively to the Nation and to the world that there is no color line hindering personal prog- ress and the recognition of personal abil- ity in the United States. By action and not ky words alone will we confound the propaganda of totalitarian groups and countries throughout the world and demonstrate beyond peradventure that America is still the home of opportunity and freedom. Mr. President, it gives me a great deal of pleasure and it is a great privilege for me to stand here today and move the confirmation of the nomination of Hon. William Henry Hastie, of the Virgin Islands, to‘be judge, United States Court of Appeals, Third Circuit. Mr. LEHMAN. Mr. President, I wish to associate myself with the distin- guished Senator from New Jersey in ex- pressing great satisfaction at approval by the Judiciary Committee of the nomi- nation of Judge Hastie. Judge Hastie has been a friend of mine for many years. He is a man of the highest character, and of great attain- ments in the legal profession. He has made a splendid record as Governor of 10619 the Virgin Islands and as a Federal judge. During the short period of time in which he has served as judge of the Court of Appeals for the Third Circuit he has also displayed great ability and an unquestioned sense of justice and fair- ness, I think the country is fortunate in having the services of a man of such outstanding character and ability, and I shall be very proud indeed to vote for confirmation of the nomination of Judge Hastie. Mr. MYERS. Mr. President, the jur- isdiction of the Court of Appeals for the Third Circuit embraces New Jersey, Pennsylvania, and Delaware. So I am happy to have this oppo~tunity this eve- ning to vote for confirmation of the nomination of Judge Hastie to be a judge of the Third Circuit Court of Appeals. I may say that Judge Hastie’s entire record is one of great distinction. I know that his colleagues on that court not only look upon him as a man who is learned in the law, but welcome him as a colleague, because he has a fine sense of decency and justice. I have heard the other judges of the court say—not once, but on numerous occasions—that they welcome with open arms Judge Hastie to be one of their colleagues. I believe it might be apropos at this time to read a short biography of this distinguished American. Judge Hastie was born in Knoxville, Tenn., on November 17, 1904. He was graduated from Amherst College with a bachelor of arts degree in 1925. He was awarded a bachelor of law degree by Harvard University in 1930, and a degree of doctor of juridical science by Harvard University in 1933. After teaching for 2 years, as the jun- jor Senator from New Jersey has just stated, at Bordentown, N. J., Judge Hastie came to Washington, and en- gaged in the private practice of law. While in Washington he was a member of the faculty of Howard University school of law. From 1933 to 1937 he was Assistant Solicitor of the Department of the In- terior. From 1937 to 1939 he was judge of the district court for the Virgin Islands. Reference has already been made to his service in that position. Thereafter he became dean of Howard University law school, and served in that capacity from 1939 to 1946. During the early part of the war, he was the civilian aide to the Secretary of War, working closely with Under Secre- tary of War Patterson on racial relations and other important questions. In May 1946, President Truman ap- pointed Judge Hastie to be Governor of the Virgin Islands. In that position Judge Hastie made many outstanding contributions to the advancement of the Virgin Islands and to the development of better relations between Washington and the Virgin Islands. Judge Hastie was appointed by Presi- dent Truman to be one of the American members of the Caribbean Commission, working with similar groups from Great Britain, France, and The Netherlands in
10620 seeking a solution of the economic and social problems of the Caribbean area. So, Mr. President, I believe Judge Hastie has earned for himself the re- spect, the esteem, and the affection of all who know him. I know he will make a very able judge on the third circuit, a court which has considerable business, and, in fact, is one of the busiest circuit courts in the land. Therefore, Mr. President, I am most happy to have this opportunity to vote for confirmation of the nomination of Judge Hastie. The PRESIDING OFFICER. The question is, Will the Senate advise and consent to this nomination? Without objection, the nomination is confirmed. UNITED STATES ATTORNEYS The legislative clerk read the nomina- tion of Thomas A. Uzzell, Jr., to be United States attorney for the western district of North Carolina. The PRESIDING OFFICER, Without objection, the nomination is confirmed. The legislative clerk read the nomi- nation of Ray J. O'Donnell to be United States attorney for the southern dis- trict of Ohio. The PRESIDING OFFICER. Without objection, the nomination is confirmed. DEPARTMENT OF COMMERCE—NOMINA- TION PASSED OVER The legislative clerk read the nomina- tion of Maj. Gen. Philip B. Fleming, United States Army, retired, to be Un- der Secretary of Commerce for Trans- portation. Mr. MAGNUSON. Mr. President, be- fore the nomination of General Fleming is voted upon, I should like to make a few remarks, because this matter in- volves the maritime industry of the Na- tion and involves several incidents and hearings which occurred not only before the Subcommittee on Merchant Marine and Fisheries, but before the full Senate Committee on Interstate and Foreign Commerce. As many of us know, Gen. Philip Fleming has had an able and a distin- guished career in the service of the Gov- ernment of the United States. Prior thereto, he had a long and d stinguished career as one of the very brilliant engi- neers in our Army. He was called into the service of the Government by President Roosevelt, and served for a long period of time as Pub- lic Works Administrator, in which ca- pacity he had charge of public roads and a great number of other engineering matters. Without going into detail, let me say that, as many of us know, the record is replete with evidence not only that our late Maritime Commission proved itself to be, in my opinion, very inefficient and very inadequate to cope with the great postwar problems of the merchant ma- rine, but also that many other criticisms have been leveled at the Maritime Com- mission, In an effort to see whether it was pos- sible to obtain better administration in the Maritime Commission, in order to clear up some of these matters, and in hope that it might become a strong arm CONGRESSIONAL RECORD—SENATE in bolstering our disappearing merchant marine, following the termination of the war and after the resignation of the then Chairman of the Maritime Commission, the President of the United States saw fit to call on General Fleming again be- cause of his recognized ability as an ad- ministrator. I recall that at the time, when he was called before the Interstate and Foreign Commerce Committee of the Senate, in connection with the question of confir- mation of his nomination to be chairman of the Maritime Commission, the distin- guished chairman of the committee, the Senator from Colorado [Mr. Jounson], and myself were present, and both of us asked, “General, what do you know about maritime matters?” He replied, “I know nothing whatso- ever.” Some of us ventured the opinion that in view of the conditions then existing in the Maritime Commission, he might be well qualified for that post. Of course we wanted a good administrator in that positior,. His nomination was confirmed, and he served in that position. At the time when he took it, the law in relation to the Maritime Commission was such that the Chairman of the Commission was chairman in name only; he had no au- thority to do what he thought should be done there to clear up some of the feuds which were going on, some of the 50- called inefficiency which has so well been pointed out by the General Accounting Office. After General Fleming had been there a few months, and after determin- ing in his own mind, I suppose, that most of the conditions still existed, although an attempt had been made to reorganize the entire Commission, it was thought best that the Congress enact legislation or suggest an Executive order giving the Chairman of the Commission more power. Such power was given to the Chairman. However, conditions did not improve a great deal. So the President of the United States, who had remained {n constant touch with the matter with our committee and with others inter- ested in maritime matters, including both labor and management, decided that the best thing to do would be to submit to Congress a reorganization order abolishing the Maritime Commis- sion and placing it in the Department of Commerce, under a three-member Mar- itime Board, That reorganization plan—plan No. 24, if I recall correctly—was approved by the Senate after some debate. The reorganization plan also provided that there should be established in the De- partment of Commerce an Under Secre- tary for Transportation. The nomina- tion of that Under Secretary for Trans- portation is now before the Senate for confirmation, the President of the United States having taken General Fleming from the position of Chairman of the Maritime Board and placed him in this new position in the Department of Commerce. Although the Under Secretary of Transportation, under Mr. Sawyer’s plan of organization and under the reorganization bill, would primarily JULY 19 devote himself to maritime matters, he would also have under his jurisdiction the CAA, Public Roads—with which General Fleming of course has had great experience and concerning which he is well qualified—and other matters pertaining to the Weather Bureau and the country’s transportation system. So that his transfer from one spot to the other puts him in the position of having his nomination now up for con- firmation for an office the dutics of which are somewhat broader than the field of maritime matters alone. But when his nomination was considered at the hearing, our primary concern was with maritime matters. Without going into detail, there was a great deal of criticism leveled at General Fleming at the hearings, not as to his personal character, his integrity, or his record, but criticism somewhat similar to those heard here a few moments ago, regard- ing the policies of the Maritime Com- mission, particularly in relation to the foreign-flag transfers. Labor unions protested, as did several other organiza- tions, not against General Fleming as an individual but on the basis of the general policies of the Maritime Com- mission. The testimony was not exactly di- rected to him as an individual, but it was criticism of the whole Maritime Com- mission. That has now been changed, and I think in all fairness that some of the criticism as to the actions of the Maritime Commission, although justifi- able, could not be laid directly at the door of the chairman, because he in- herited a confused situation. He in- herited problems which, due to the in- adequacies of the chairmanship in one period, he could not solve. After that, he was only in office for a short period of time, possibly not long enough to do the right kind of job or the kind of job he might have liked to do. As I say, that situation has been changed, and I am sure that those who are critical of those policies will find that General Fleming, in his new position, will carry out not only the mandates and the intentions of Congress, but the best interests of the entire maritime industry of the Nation, which needs a friend in court, because of its condition, particularly in these times when it becomes so important and s0 integral a part of our national defense. Although I had originally intended to say more about this nomination when it came up for consideration today, it is important in these times that the nomi- nation of General Fleming be confirmed, so that the Secretary of Commerce may function in respect to vital transporta- tion matters. I merely wanted to clarify the record by these remarks. I hope the Senate will confirm General Fleming's nomina- tion, and at this time also will realize that the situation in the old Maritime Commission was probably not entirely of any one man’s making. Mr. LUCAS. Mr. President, a few moments ago, before the Senator from Washington began to speak, the Sena- tor from North Dakota [Mr. Lancrr] came over to me and requested that this nomination go over, I am serving
1950 notice now that we shall move to take it up tomorrow afternoon and make final determination. Mr. MAGNUSON. I hope thc Sena- tor will do that, because delay would . be rather serious because, until the nomi- nee is confirmed, I do not suppose there will be an appointment to the Mari- time Board. It is vital that that board begin to function as soon as possible. The PRESIDING OFFICER. With- out objection, the nomination will go over. Mr. HENDRICKSON. Mr. President, a@ parliamentary inquiry. The PRESIDING OFFICER. The Senator will state it. Mr. HENDRICKSON. Is the Senate still in executive session? The PRESIDING OFFICER, The Senate is still in executive session. Without objection, the Senate will re- sume the consideration of legislative business. THE KOREAN CRISIS Mr. HENDRICKSON. Mr. President, as I listened to the reading of the Presi- dent’s message, I could not help but be reminded again and again of the highly dangerous and tortuous road which lies ahead for the free nations of the world. In the main, I commend the President for the very sound and sensible program which he has outlined, but I would re- mind him that the cooperation which will be required to carry forward such extensive emergency functions of gov- ernment, cannot be a ‘“‘one-way street.” I remind him of this fact because on the domestic front he again recom- mends rigid economies and yet in my 2 years in Congress, I have seen very little cooperation from the administra- tion in attempting to effect these long overdue economics. Whether war comes or not, whether war is here or not, they are essential, but they now become a “must.” National security is as fully dependent upon economic stability as it is upon military preparedness. I have never had any doubt as to the highly explosive course we were pur- suing when we engaged as participants in the Korean crisis. I warned, on June 26, that a positive course of action would produce attendant risks of war, but I said that failure on our part to demend full respect for and compliance with the rules of the United Nations would be interpreted by our foes as a manifestation of cowardice and weak- ness. I said further that if we fail in one crisis, we shall fail in others, And now, since all Members of the Senate must fully realize the import of the President’s message and the ex- tent to which it involves us, both at home and abroad, I would say to all critics, be they Republican or Demo- crat, that from here on we must not be less than constructive in our criti- cism, for by small talk and petty bick- ering, whether on the floor of Congress or elsewhere, we can only give our enemies fuel with which to build new MAIL DELIVERIES IN DALLAS Mr. LANGER. Mr, President, I ask Bnanimous consent to have printed in XCVI-~——669 CONGRESSIONAL RECORD—SENATE the body of the Recorp an article from the Washington Post of this morning, with this headline: “‘Two Mail Deliveries in Dallas Suburb Ordered by Court.” I call this to the attention of every Senator in connection with the resolu- tion dealing with the curtailment by the Postmaster General of mail deliveries, The article reads: Datvas, Tex., July 18—The postman must call twice tn Oak Cliff, suburb within the city of Dallas, a Federal circuit judge ruled today. An Oak Cliff insurance man, Judge B. Fite, had complained his business suffered when the single mail delivery was instituted in the Oak Cliff district, while Dallas’ main busi- ness section goth three deliveries, Attorneys for the Postmaster General were expected to appeal the decision. Judge Atwell, in making permanent an ine junction against Dallas Postmaster J. How- ard Payne to prevent the cut in mail de- livery to Oak Cliff, said that “the postmaster has discriminated against the business sec- tion of Oak Cliff,” which is, “in truth and in fact, a city In its own right.” COTTON PRODUCTION Mr. MAYBANK. Mr. President, in view of the fact that there has been some discussion this afternoon of increases in the price of cotton, I should like to state for the record some statistics in regard to cotton production. “This year the cotton acreage was raised to 19,032,000. However, in the cotton belt there has been the worst growing season on record. The boll weevils have been abundant and have caused a tragic loss to the cotton crop, and the weather this spring has been terrible. On July 10, the Department of Agri- culture issued an estimate in regard to the conditions which resulted from that situation. That estimate was not in terms of bales of cotton, but it shows a dreadful loss. Private estimates which have been made indicate a loss that is very great indeed—a difference between last year’s crop of 16,127,000 bales and a crop for this year which is estimated to be between 10,000,000 and 10,500,000 bales. Mr. President, no one has suffered more from the cold spring, the rains, and the other hazards than has the cotton farmer. I simply wish the record to show the official estimate of the Depart- ment of Agriculture. NEWS LETTERS FROM SENATOR HUMPHREY Mr. HUMPHREY. Mr. President, TI ask unanimous consent that two news letters which I have prepared to send out to the people of my State be incor- porated in the Recorp. One of these news letters pertains to the recent Korean crisis, and I call to the attention of the Senate the heading “Economy or false economy?” That particular paragraph has some- thing to do with what I call total de- fense. There seems to be an attitude in the country that the way to prepare for defense is through the armed services, But that is not my conclusion. I believe that national defense means more than the armed services. I believe it means hydroelectric power, I believe it means land irrigation and reclamation, I believe ‘stands at 97 percent, 10621 it means the health of the people and the education of the people. Every dol- lar we spend in these areas for strength- ening the American economy is worth every bit as much as money we spend for atom bombs, reserves, or aircraft, or anything we might need in the armed services, because the strength of the country is not going to be found in how many divisions we may put into the ficld tomorrow, but how much we can prepare for the coming time to contribute to the over-all strength and confidence and power of the American people and the American economy. Mr. President, I ask also that the sec- ond letter, pertaining to some observa- tions on American agriculture and a review of the legislation we have dis- cussed, be incorporated in the Recorp. There being no objection, the news letters were ordered to be printed in the ReEcorp, as follows: Your Senator Reports (Weekly news letter from the desk of Husert H, Humpurey, week of June 18, 1950) AGRICULTURE On Wednesday, June 7, the Senate passed another important piece of legislation to bul- wark the farm price-support program. I refer to Senate bill 2826, legislation increas- ing the borrowing power of the Commodity Credit Corporation by €2,000,000,000. This assures farmers that the farm price-support program will be backed up by sufficient funds. The Department of Agriculture will soon announce the loan and purchase programs for price supports on wheat, corn, rye, barley, flax, dairy products, hogs and other com- modities. (Write for full report on this bill.) It is estimated that price supports for next year will “cost” much less than in the past 2 years. Present estimates indicate price- support “costs” at between 650 and 600 million dollars. This ts to be compared with an average of about 2 billion dollars a year in the past 2 years. The term “cost” should be used with caution since the money pro- vided by the CCC for price supports is in the form of loans which may be redeemed through farmer or Government sales. The cost of price supports may well go down bee cause of the following factors: 1. The rising prices on farm commodities, 2. Lower production because of acreage allotment and production controls. 3. Heavier consumer demand. The estimated cost of farm price supports will be slightly over 1 percent of the Federal budget. A professional farm econo- mist recently pointed out that @1 of farm income creates about 867 of income for people off the farm. Farm parity now Any serious drop in farm income would have disastrous results on the entire economy. It is believed that marketing costs at city marketing terminals is an important factor in the high cost of farm products to con- sumers. This point of view will be thorough- ly explored in hearings on a House bill to im- prove marketing facilities. Congress is be- coming more consumer conscious on agri- cultural products. We still have not managed to perfect a pro- gram to properly meet the needs of perish- able farm products. Curtailing production does not receive much support. The emphasis is upon increasing consumption. NEW LAW FOR VETS’ HOUSING The Housing Act of 1950—the GI housing bill—makes several important changes in the home loan benefits for GI's. 1. Increase in the amount of guaranty on veterans’ home loan to 60 percent of the loan up to a maximum guaranty of $7,500.