10664 President, by and with the advice and con- sent of the Senate. One of the appointive members shall be the Chairman of the Board of Directors of the Corporation and not more than two of the members of such Board of Directors shall be members of the same po- litical party. Each such appointive member shall hold office for a term of 6 years, In the event of a vacancy in the office of the Comptroller of the Currency, and pending the sppointment of his successor, or during the absence of the Comptroller from Wash- ington, the Acting Comptroller of the Cur- rency shall be a member of the Board of Directors in the place and stead of the Comptroller. In the event of a vacancy in the oftice of the Chairman of the Board of Directors, and pending the appointment of his successor, the Comptroller of the Cur- rency shall act as Chairman. The members of the Board of Directors shall be ineligible during the time they are in office and for 2 years thereafter to hold any office, posi- tion, or employment in any Insured bank, except that this restriction shall not ap- ply to any member who has served the full term fcr which he was appointed. No mein- ber of the Board of Directors shall be an officer or director of any insured bank or Federal Reserve bank or hold stcck in any insured bank; and before entering upon his duties as a member of the Board of Direc- tors he shall certify under oath that he has complied with this rcquirement and such certification shall be filed with the secretary of the Board of Directors. “Src. 3. As used in this act— “(a) The term ‘State bank’ means any bank, banking agsociation, trust company, savings bank, or other banking institution which is engaged in the business of receiv- ing deposits, other than trust funds as here- in defined, and which ts incorporated under the laws of any State, any Territory of the United States, Puerto Rico, or the Virgin Islands, or which is operating under the Code of Law for the District of Columbia (except a national bank), and includes any unincorporated bank the deposits of which are insured on the effective date of this amendment. “(b) The term ‘State member bank’ means any State bank which is a member of the Federal Reserve System, and the term ‘State nonmember bank’ means any State bank which is not a member of the Federal Reserve System. “(c) The term ‘District bank’ means any State bank operating under the Code of Law for the District of Columbla. “(d) The term ‘national member bank' menons any national bank located in any of the States of the United States, the District of Columbia, any Territory of the United States, Puerto Rico, or the Virgin Islands which is a member of the Federal Reserve System. “(e) The term ‘national nonmember bank’ means any national bank located in any Territory of the United States, Puerto Rico, or the Virgin Islands which is not a member of the Federal Reserve System, “(f) The term ‘mutual savings bank’ means a bank without capital stock trans- acting a savings bank business, the net earn- ings of which inure wholly to the benefit of its depositors after payment of obligations for any advances by its organizers. “(g) The term ‘savings bank’ means a bank (other than @ mutual savings bank) which transacts its ordinary banking business strictly as a savings bank under State laws imposing special requirements on such banks governing the manner of investing their funds and of conducting their business: Provided, That the bank maintains, until maturity date or until withdrawn, all de- posits made with it (other than funds held by it in a fiduciary capacity) as time savings deposits of the specific term type or of the type where the right is reserved to the bank to require written notice before permitting CONGRESSIONAL RECORD—HOUSE withdrawal: Provided further, That such bank to be considered a savings bank must elect to become subject to regulations of the Corporation with respect to the redeposit of maturing deposits and prohibiting with- drawal of deposits by checking except in cases where such withdrawal was permitted by law on August 23, 1935, from specifically designated deposit accounts totaling not more than 15 percent of the bank's total deposits “(h) The term ‘insured bank’ means any bank the deposits of which ure insured in accordance with the provisions of this act; and the term ‘noninsured bank’ means any bank the deposits of which are not so in- sured “(Q) The term ‘new hank’ means a new national banking association organized by the Corporation to assume the insured de- posits of an insured bank clored on account of inability to meet the damands of its de- positors and otherwise to perform tempo- rarily the tunctions presertbed in tiils act. “(j) The term ‘receiver’ Includes ai re- eciver, hquidating agent, conservator, com- mission, person, or other agency charged by law with the duty of winding up the affairs of a bank. “(k) The term ‘Board of directors’ means the board of directors of the corporation. “(1) The term ‘deposit’ means the unpaid balance of moncy or its equivulent received by a bank in the usual course of business and for which it has given or is obligatcd to give credit to ao commercial, checking, suv- ings, time, or thrift account, or which is evidenced by its certificate of deposit, and trust funds held by such bank whether retained or deposited in any department of such bank or deposited in another bank, to- gether with such other obligations of a bank as the board of directors shall find and shall prescribe by its regulations to be deposit liabilities by general usage: Provided, That any obligation of a bank which is payable only at an office of the bank located outside the States of the United States, the District of Columbia, any Territory of the United States, Puerto Rico, and the Virgin Islands, shall not be a deposit for any of the purposes of this act or be included as a part of total deposits or of an insured deposit: Provided further, That any insured bank having its principal place of business in any of the States of the United States or in the District of Columbia which maintains a branch in any Territory of the United States, Puerto Rico, or the Virgin Islands may elect to ex- clude from insuranco under this act its de- posit obligations which are payable only at such branch, and upon so electing the in- sured bank with respect to such branch shall comply with the provisions of thls act ap- plicable to the termination of insurance by nonmember banks: Promded further, That the bank may elect to restore the insurance to such deposits at any time its capital stock is unimpaired. “(m) The term ‘insured deposit’ means the net amount due to any depositor for deposits in an insured bank (after deducting offsets) less any part thereof which is in excess of $10,000. Such net amount shall be deter- mined according to such regulations as the board of directors may prescribe, and in de- termining the amount due to any depositor there shall be added together all deposits in the bank maintained in the same capacity and the same right for his benefit either in his own name or in the names of others except trust funds which shall be insured as provided in subsection (1) of section 7, Each officer, employee, or agent of the United States, of any State of the United States, of the District of Columbia, of any Territory of the United States, of Puerto Rico, of the Virgin Islands, of any county, of any mu- nicipality, or of any political subdivision thereof, herein called public unit, having official custody of public funds and lawfully depositing the same in an insured bank JULY 19 shall, for the purpose of determining the amount of the insured deposits, be deemed a depositor in such custodial capacity separate and distinct from any other officer, employee, or agent of the same or any public unit hav- ing offictal custody of public funds and law- fully depositing the same in the same insured bank in custodial capacity. “(n) The term ‘transferred deposit’ means a deposit in a new bank or other in- sured bank made available to a depositor by the Corporation as payment of the in- sured deposit of such depositor in a closed bank, and assumed by such new bank or other insured bank. “(o) The term ‘branch’ includes any branch bank, branch office, branch agency, additional office, or any branch place of bueiness located in any State of the United States or in any Territory of the United States, Puerto Rico, or the Virgin Islands at which deposits are received or checks paid or money Icnt. “(p) The term ‘trust fund’ means funds held by an insured bank in a fiductary capac- ity and includes, without being Hmited to, funds held as trustee, executor, administra- tor, guardian, or a ent. “Sec. 4. (a) Every bank, which is an in- sured bank on the efiective date of this amendment, shall bs and continue to be, without application or abproval, an insured bank and shall be subject to the provisions of this act. “(b) Every national member bank which is authorized to commence or resume the business of banking, and which is engased in the business of receiving deposits other than trust funds as herein defined, and every such national nonmember bank which becomes a member of the Federal Reserve System, and every State bank which is converted into a national member bank or which becomes ‘a member of the Federal Reserve System, and which is engaged in the business of receiv- ing deposits, other than trust funds as here- in defined, shall be an insured bank trom the time it is authorized to commence or re- sume business or becomes a member of the Federal Reserve System. The certificate herein prescribed shall be issued to the Cor- poration by the Comptroller of the Currency in the case of such national member bank, or by the Board of Governors of the Federal Reserve System in the case of such State member bank: Prov:ded, That in the case of an insured bank which is admitted to mem- bership in the Federal Reserve System or an insured State bank which is converted into @ national member bank, such certificate shall not be required, and the bank shall continue as an insured bank. Such certifi- cate shall state that the bank is authorized to transact the business of banking in the case of a nationnl member bank, or is a member of the Federal Reserve System in the case of a Stute member bank, and that con- sideration has been given to the factors enumerated in section 6. “Src, 5. Subject to the provisions of this act, any national nonmember bank which is engaged in the business of receiving deposits, other than trust funds as herein defined, upon application by the bank and certifica- tion by the Comptroller of the Currency in the manner prescribed in subsection (b) of section 4 and any State nonmember bank, upon application to and examination by the Corporation and approval by the Board of Directors, may become an insured bank. Be- fore approving the application of any such State nonmember bank, the Board of Direc- tors shall give consideration to the factors enumerated in section 6 and shall determine, upon the basis of a thorough examination of such bank, that its assets in excess of its capital requirements are adequate to enable it to meet all of its liabilities to depositors and other creditors as shown by the books of the bank “Src. 6. The factors to be enumerated in the certificate required under scction 4 and
1950 to be considered by the Board of Directors under section 6 shall be the.following: The financial history and condition of the bank, the adequacy of its capital structure, ite fu- ture earnings prospects, the general charac- ter of its management, the convenience and needs of the community to be served by the bank, and whether or not ite corporate pow- ers are consistent with the purposes of thia act. “Sec, 7. (a) The asseesment rate shail be one-twelfth of 1 percent per annum. The semiannual assessment for each tneured bank shal] be in the amount of the product of one-half the annual assessment rate multi- plied by the assessment base. The assess- ment base shall be the amount of the labil- ity of the bank for deposits, according to the definition of the term ‘deposit’ in and pur- suant to subsection (1) of section 8, with- out any deduction for indebtedness of de- positors: Provided, That the bank— “(1) may deduct (1) from the deposit bal- ance due to an insured bank the deposit balance due from such insured bank (other than trust funds deposited by it In euch bank) which ts subject to t!mmediate with- drawal; (if) trust funds held by the bank in a fiduciary capacity and which are deposited ° in another insured bank; and (ill) cash items as determined by either of the following methods, at the option of the bank: (aa) By multiplying by 2 the total of the cash items forwarded for collection on the assess- ment base days (being the days on which the average deposits are computed) and cash items held for clearings at the close of busi- ness on said days, which are in the process of collection and which the bank has paid in the regular course of business or credited to deposit accounts; or (bb) by deducting the total of cash items forwarded for collec- tion on the assessment base days and cash Items held for clearings at the close of busi- ness on said days, which are in the process of collection and which the bank has paid in the regular course of business or credited to deposit accounts, plus such uncbdilected {tems paid or credited on preceding days which are in the process of collection: Pro- vided, That the Board of Directors may define the terms ‘cash items,’ ‘process of collection,’ and ‘uncollected items’ and shall fix the max- imum perjod for which any such item may be deducted; and “(2) may exclude from ita assessment base (1) drafts drawn by it on deposit accounts in other insured banks which are issued in the regular course of business; and (i!) cash funds which are received and held solely for the ptrpose of securing & liability to the bank but not in an amount in excess of such lia- bility, and which are not subject to with- drawal by the obligor and are carried in a special non-interest-bearing account desig- nated to properly show their purpose. Each insured bank, as a condition to the right to make any such deduction or exclu- sion in determining its assessment base, shall maintain such records as will readily permit verification of the correctness thereof, The semiannual assessment base for one semi- annual period shall be the average of the assessment base of the bank as of the close of business on March 31 and June 30, and the semiannual assessment base for the other semiannual period shall be the aver- age of the assessment base of the bank as of the close of business on September 80 and December 31: Provided, That when any of said days is @ nonbusiness day or @ legal holiday, either National or State, the preced- ing business day shall be used. The certified statements required to be filed with the Cor- poration under subsections (b) and (c) of this section shall be in such form and set forth such supporting information as the Board of Directors shall prescribe. The as- sessment payments required from insured banks under subsections (b) and (c) of this section shall be made in such manner and at such time or times as the Board of Directors CONGRESSIONAL RECORD—HOUSE shall prescribe provided the time or times so prescribed shall not be later than 60 days after filing the certified statement setting forth the amount of assessment. “(b) On or before the 15th day of July of each year, each insured bank shall file with the Corporation a certified statement showing for the 6 months ending on the pre- ceding June 80 the amount of the assess- ment base and the amount of the semian- nual assessment due to the Corporation for the period ending on the following Decem- ber 31 determined in accordance with sub- section (a) of this section, which shall con- tatn or be verified by a written declaration that it 1s made under the penalties of per- jury. Each insured bank shall pay to the Corporation the amount of the semiannual assessment it is required to certify. On or before the 15th day of January of each year, each insured bank shall file with the Cor- poration 4 similar certified statement for the 6 months ending on the preceding December 81 and shall pay to the Corporation the amount of the semiannual assessment for the period ending on the following June 30 which it is required to certify. “(c) Each bank which becomes an insured bank shall not be required to file any cer- tifled statement or pay any assessment for the semiannual period in which it becomes an insured bank. On the expiration of such period, each such bank shall comply with the provisions of subsection (b) of this section except that the semiannual assessment base for its first certified statement shall be the assessment base of the bank as of the close of business on the preceding June 30 or De- cember 31, whichever is applicable, deter- mined in accordance with subsection (a) of this section. If such bank has assumed the Mabilities for deposits of another bank or banks, it shall include such liabilities in Its assessment base. The first certified state- ment shall show as the amount of the first semiannual assessment due to the Corpora- tion, an amount equal to the product of one-half of the annual assessment rate mul- tiplied by such assessment base. “(d) As of December 31, 1949, and each calendar year thereafter, the Corporation shall transfer 40 percent of its net assess- ment income to its capital account and the balance of the net assessment income shall be credited pro rata to the insured banks based upon the assessments of each bank during said calendar year. Such credits shall be applied by the Corporation toward the payment of the total assessments becoming due for the semiannual assessment period beginning the next ensuing July 1. The term ‘net assessment income’ as used herein means the total assessinents which become due dur- ing the calendar year less (1) the operating costs and expenses of the Corporation for the calendar year; (2) additions to reserve to provide for insurance losses during the cal- endar year, except that any adjustments to reserve which result in a reduction of such reserve shall be added; and (3) the insur- ance losses sustained in said calendar year plus losses from any preceding years in ex- cess of such reserves. If the above deduc- tions exceed in amount the total assessments which become due during the calendar year, the amount of such excess shal] be restored by deduction from total assessments becom- ing due in subsequent years. “(e) The Corporation (1) may refund to an insured bank any payment of assessment in excess of the amount due to the Corpora- tion or (2) may credit such excess toward the payment of the assessment next becoming due from such bank and upon succeeding assessments until the credit is exhausted, “(2) Any insured bank which falls to file any certified statement required to be filed by it in connection with determining the amount of any assessment payable by the bank to the Corporation may be compelled to file such statement by mandatory injunc- tion or other appropriate remedy in a sult 10665 brought for such purpose by the Corporation against the bank and any officer or officers thereof in any court of the United States of competent jurisdiction in the District or Territory in which such bank {s located. “(g) The Corporation, in a suit brought at law or in equity tn any court of competent jurisdiction, shall be entitled to recover from any insured bank the amount of any unpaid assessment lawfully payable by such insured bank to the Corporation, whether or not such bank shall have filed any such certified statement and whether or not sult shall have been brought to compel the bank to file any such statement. No action or proceeding shall be brought for the recovery of any as- sessment due to the Corporation, or for the recovery of any amount paid to the Corpore- tion in excess of the amount due to it, unless such action or proceeding shall have been brought within 6 years after the right accrued for which the claim is made, except where the insured bank has made or filed with the Corporation a false or fraudulent certified statement with the intent to evade, in whole or in part, the payment of assessment, in which case the claim shall not be deemed to have acrued until the discovery by the Corporation that the certified statement is false or fraudulent: Providing, however, That where a cause of action has already accrued, and the period herein prescribed within which an action may be brought has ex- pired, or will expire within 1 year from the date this amendment becomes effective, an action may be brought on such cause of ac- tion within 1 year from the effective date of this amendment: And provided further, That no action or proceeding shall be brought for the recovery of any assessment on de- posits alleged to have been omitted from the assessment base of any insured bank for any year prior to 1945 except that any claim of the Corporation for the payment of any as- sessment may be offset by it against any claim of the bank for the overpayment of any assessment. “(h) Should any national member bank or any insured national nonmember bank fail to file any certified statement required to be filed by such bank under any provision of this section, or fail to pay any assessment required to be paid by such bank under any provision of this act, and should the bank not correct such failure within 30 days after written notice has been given by the Corpo- ration to an officer of the bank, citing this subsection, and stating that the bank has failed to file or pay as required by law, all the rights, privileges, and franchises of the bank granted to it under the National Bank Act, as amended, the Federal Reserve Act, as amended, or this act, shall be thereby for- Teited. Whether or not the penalty provided in this subsection has been incurred shall be determined and adjudged in the manner pro- vided in the sixth paragranh of section 2 of the Federal Reserve Act, as ameuded. The remedies provided in this subsection and in the two preceding subsections shall not be construed as limiting any other remedies against any insured bank, but shall be in addition thereto. “(i) Trust funds held by an insured bank {n a fiduciary capacity whether held in its trust or deposited in any other department or in another bank shall be insured in an amount not to exceed $10,000 for each trust estate, and when deposited by the fiduciary bank in another insured bank such trust funds shall be similarly insured to the fidu- clary bank according to the trust estates rep- resented. Notwithstanding any other pro- vision of this act, such insurance shall be separate from and additional to that cover- ing other deposits of the owners of such trust funds or the beneficiaries of such trust estates: Provided, That where the fiduciary bank deposits any of such trust funds in other tnsured banks the amount so held by other Insured banks on deposit shall not for
10666 the purpose of any certified statement re- quired under subsections (b) and (c) of this section be considered to be a deposit liability of the fiduciary bank, but shall be considered to be a deposit Mability of the bank in which such funds are so deposited by such fiductary bank. The Board of Directors shall have power by regulation to prescribe the manner of reporting and of depositing such trust funds. “Sec. 8. (a) Any insured bank (except a na- tional member bank or State member bank) may, upon not less than 90 days’ written no- tice to the Corporation, and to the Recon- struction Finance Corporation if it owns or holds as pledgee any preferred stock, capital notes, or debentures of such bank, terminate its status as an insured bank. Whenever the Board of Directors shall find that an insured bank or its directors or trustees have con- tinued unsafe or unsound practices in con- ducting the business of such bank, or have knowingly or negligently permitted any of i®* officers or agents to violate any provision of any law or regulation to which the insured bank is subject, the Board of Directors shall first give to the Comptroller of the Currency in the case of a national bank or a District bank, to the authority having supervision of the bank in the case of a State bank, or to the Board of Governors of the Federal Re- serve System in the case of a Siute member bank, a statement with respect to such prac- tices or violations tor the purpose of secur- ing the correction thereof and shall give a copy thereof to the bank Unless such cor- rection shall be made within 120 days or such shorter period of time as the Comp- troller of the Currency, the State authority, or Board of Governors of the Federal Reserve System, as the case may be, shall require, the Board of Directors, if it shall determine to proceed further, shall give to the bank not less than 30 days’ written notice of intention to terminate the status of the bank as an insured bank, and shall fix a time and place for a hearing before the Board of Directors or before a person designated by it to con- duct such hearing, at which evidence may be produced, and upon such evidence the Board of Directors shall make written find- ings which shall be conclusive. Unless the bank shall appear at the hearing by a duly authorized representative, .t’, shall be deemed to have consented to the termination of its status as an insured bank. If the Board of Directors shall find that any unsafe or un- sound practice or violation specified in such notice has been established and hus not been corrected within the time above pie- scribed in which to make such corrections, the Board of Directors mav order that the insured status of the bank be terminated on @ date subsequent to such finding and to the expiration of the time specified in such notice of intention. The Corporation may publish notice of such termination and the bank shall give notice of such termination to each of its depositors at his last address of record on the books of the bank, in such manner and at such time as the Board of Directors may find to be necessary and may order for the protection of depositors. After the termination of the insured status of any bank under the provisions of this subsec- tion, the insured deposits of each depositor in the bank on the date of such termination, Jess all subsequent withdrawals from any deposits of such depositor, shall continue for a period of 2 years to be insured, and the bank shall continue to pay to the Corpora- tion assessments as in the case of an insured bank during such period. No additions to any such deposits and no new deposits in such bank made after the date of such ter- mination shall be insured by the Corpora- tion, and the bank shall not advertise or hold itself out as having insured deposits unless in the same connection it shall also state with equal prominence that such additions CONGRESSIONAL RECORD—HOUSE to deposits and new deposits made after such date are not so insured. Such bank shall, in all other respects, be subject to the duties and obligations of an insured bank for the period of 2 years from the date of such termination, and in the event that such bank shall be closed on account of inability to meet the demands of its depositors within such period of 2 years, the Corporation shall have the same powers and rights with respect to such bank ag in.case of an insured bank. “(b) Whenever the insured status of a State member bank shall be terminated by action of the Board of Directors, the Board of Governors of the Federal Reserve System shall terminate its membership in the Fed- eral Reserve System in accordance with the provisions of section 9 of the Federal Reserve Act, and whenever the insured status of a national member bank shall be so termi- nated the Comptroller of the Currency shall appoint a receiver for the bank, which shall be the Corporation. Whenever a member bank shall cease to be a member of the Federal Reserve System, its status as an in- sured bank shall, without notice or other action by the Board of Directors, terminate on the date the bank shall cease to be a member of the Federal Reserve System, with like effect as if its insured status had been torminated on said date by the Board of Directors after proceedings under subsection (a) of this section. “(c) Notwithstanding any other provision of law, whenever the Board of Directors shall determine that an insured banking tnstitu- tion is not engaged in the business of receiv- ing deposits, other than trust funds as here- in defined, the Corporation shall notify the banking institution that its insured status will terminate at the expiration of the first full semiannual assessment period following such notice. A finding by the Board of Di- rectors that a banking institution is not en- gaged in the business of receiving deposits, other than such trust funds, shall be con- clusive The Board of Directors shall pre- scribe the notice to be given by the banking institution of such termination and the Cor- poration may publish notice thereof. Upon the termination of the insured status of any such banking institution, its deposits shall thereupon cease to be insured and the bank- inp institution shall thereafter be relieved of all future obligations to the Corporation, including the obligation to pay future as- sessments “(d) Whenever the Habilities of an in- sured bank for deposits shall have been as- sumed by another insured bauk or banks, the insured status of the bank whose la- bilities are so assumed shall terminate on the date of receipt by the Corporation of satisfactory evidence of such assumption with like effect as if its insured status had been terminated on said date by the Board of Directors after proceedings under subsec- tion (a) of this section: Provided, That if the bank whose liabilities are so assumed gives to its depositors notice of such assump- tion within 80 days after such assump- tion takes effect, by publication or by any reasonable means, in accordance with regu- Jations to be prescribed by the Board of Directors, the insurance of its deposits shall terminate at the end of 6 months from the date such assumption takes effect. Such bank shall be subject to the duties and ob- ligations of an insured bank for the period its deposits are insured: Provided, That if the deposits are assumed by a newly insured bank, the bank whose deposits are assumed shall not be required to pay any assessment upon the deposits which have been s0 as- sumed after the semiannual period in which the assumption takes effect. “Sxc. 9, Upon the date of enactment of the Banking Act of 1933, the Corporation shall become a body corporate and as such shall have power— “First. To adopt and use a corporate seal. JULY 19 “Second. To have succession until dissolved by an act of Congress. “Third. To make contacts. “Fourth. To sue and be sued, complain and defend, in any court of law or equity, State or Federal. All suits of a civil nature at common law or in equity to which the Cor- poration shall be a party shall be deemed to arise under the laws of the United States: Provided, That any such suit to which the Corporation is a party in its capacity as receiver of a State bank and which involves only the rights or obligations of depositors, creditors, stockholdors, and such State, bank under State law shall not be deemed to arise under the laws of the United States. Except as otherwise provided in sections 7 (g), 11 (g), and 12 (e), no suit by or against the Corporation shall be allowed unless it shall have been brought within 5 years after the right aceryed on which suit is brought. No attachment or execution shall be issued against the Corporation or its property be- fore final judgment in any suit, action, or proceeding in any State, county, municipal, or United States court. The Board of Di- rectors shall designate an agent upon whom service of process may be made in any State, Territory, or jurisdiction in which any in- sured bank is located. “Fifth. To appoint by its Board of Di- rectors such officers and employees as are not otherwise provided for in this act, to define their duties, fix their compensation, require bonds of them and fix the penalty thereof, and to dismiss at pleasure such offi- cers or employees, Nothing in this or any other act shall be construed to prevent the appointment and compensation as an officer or employee of the Corporation of any officer or employee of the United States in any board, commission, independent establish- ment, or executive department thereof. “Sixth To prescribe, by its Board of Di- rectors, bylaws not inconsistent with law, regulating the manner in which its general business may be conducted, and the privi- leges guanted to it by law may be exercised and enjoyed. “Seventh. To exercise by its Buard of Di- rectors, or duly authorized officers or agents, all powers specifically granted by the provi- sions of this act, and such incidental powers as shall be necessary to carry out the powers so granted. “Eighth. To make examinations of and to require information and reports from banks, as provided in this act. “Ninth. To act as receiver. “Tenth. To prescribe by its Board of Di- rectors such rules and regulations as it may deem necessary to carry out the provisions of this act. “Src. 10 (a) The Board of Directors shall administer the affairs of the Corporation fairly and impartially and without discrimi- nation. The Board of Directors of the Corpo- ration shall determine and prescribe the manner in which its obligations shall be incurred and its expenses allowed and paid. The Corporation shall be entitled to the free use of the United States mails in the same manner as the executive departments of the Government. The Corportion with the con- sent of any Federal Reserve bank or of any board, commission, independent establish- ment, or executive department of the Gov- ernment, including any field service thereof, may avail itself of the use of information, services, and facilities thereof in carrying out the provisions of this act. “(b) The Board of Directors shall appoint examiners who shall have power, on behalf of the Corporation, to examine any insured State nonmember bank (except a District bank), any State nonmember bank making application to become an insured bank, and any closed insured bank, whenever in the judgment of the Board of Directors an ex- amination of the bank is necessary. Such examiners shall bave like power to examine,
1950 with the written consent of the Comptroller of the Currericy, any national bank or Dis- trict bank, and, with the written consent of the Board of Governors of the Federal Re- serve System, any State member bank. Each such examiner shall have power to make @ thorough examination of all the affaira of the bank and in doing so he shall have power to administer onths and to examine and take and preserve the testimony of any of the officers and agents thereof, and shall make a full and detailed report of the con- dition of the bank to the Corporation, The Board of Directors in like manner shall appoint claim agents who shail have power to investigate and examine all claims for in- sured deposits and transferred deposits, Each claim agent shall have power to ad- minister oaths and to examine under oath and take and preserve the testimony of any persons relating to such claims. “(c) For the purpose of any hearing under this act, the Board of Directors, any mem- ber thereof or any person designated by the Board of Directors to conduct any such hear. ing, is empowered to administer oaths and affirmations, supbena any officer or employee of the insured bank, compel! his attendance, take evidence, take depositions and require the production of any books, records, or other papers of the insured bank which are relevant or material to the inquiry. For the purpose of any hearing, examination, or investigation under this act, the Board of Directors may apply to any judge or clerk of any court of the United States within the jurisdiction of which such hearing, exami- nation, or investigation is carried on, or where such person resides or carries on busi- ness, to issue a subpena commanding each person to whom it is directed to attend and give testimony or for the taking of his depo. sition and to produce books, records, or other papers relevant or material to such hearing, examination, or investigation at a time and place and before a person therein specified. Such attendance of witrmesses and the pro- duction of any such papers may be required from any place in any State or in any Terri. tory or other place subject to the jurisdic- tion of the United States at any designated place where such a hearing is being held or such examination or investigation is being made: Provided, however, That the produc- tion of a person's documents at any place other than his place of business shall not be required in any case in which, prior to the return date specified in the subpena with respect thereto, such person either has fure nished as directed a copy of such documents (certified by such person under oath to be a@ true and correct copy) or has entered into & stipulation with any authorized represent- ative of the Corporation as to the informa. tion contained in such documents. Wit- nesses subpenaed under this section shall be paid the same fees and mileage that are paid witnesses in the district courts of the United States. “(d) In cases of refusal to obey a subpena issued to, or contumacy by, any person, the Board of Directors may invoke the aid of any court of the United States within the jurisdiction of which such hearing, exami- nation or investigation is carried on, or where such person resides or carries on busi- ness, in requiring the attendance and testi- mony of witnesses and the production of books, records, ot other papers. And such court may issue an order requiring such person to appear before the Board of Di- rectors or member or person designated by the Board of Directors, there to produce rec- orda, if so ordered, or to give testimony touching the matter in question; and any failure to obey such order of the court may be punished by such court as a contempt thereof, All process in any auch case may be served in the judicial district whereof such person is an inhabitant or carries on business or wherever he may be found, No person shall be excused from attending and CONGRESSIONAL RECORD—HOUSE testifying or from producing books, records, or other papers in obedience to a subpena fssued under the authority of this act on the ground that the testimony or evidence, documentary or otherwise, required of him may tend to incriminate him or subject him te penalty or forfeiture; but no individual shall be prosecuted or subjected to any pen- alty or forfeiture for or on account of any transaction, matter, or thing concerning which he ts compelled to testify or produce evidence, documentary or otherwise, after having claimed his privilege against self-in- crimination, except that such indtvidual so testifying shall not be exempt from prose- cution and punishment for perjury com- mitted in so testifying. “(e) Each insured State nonmember bank (except a District bank) shall make to the Corporation reports of condition tn such form and at such times as the Board of Directors may require. The Board of Direc- tors may require such reports to be pub- lished in such manner, not inconsistent with any applicable law, as it may direct. Every such bank which fails to make or publish any such report within such time, not less than 5 days, as the Board of Directors may require, shal] be subject to a penalty of not more than 6100 for each day of such failure recoverable by the Corporation for its use. “(f) The Corporation shall have access to reports of examination made by, and reports of condition made to, the Comptroller of the Currency or any Federal Reserve bank, may accept any report made by or to any commission, board, or authority having su- pervision of a State nonmember bank (ex- cept a District bank), and may furnish to the Comptroller of the Currency, to any Federal Reserve bank, and to any such com- mission, board, or authority, reports of exami- nations made on behalf of, and reports of condition made to, the Corporation, “(g) The Corporation may cause any and all records, papers, or documents kept by it or In ite possession or custody to be photo-~ graphed or microphotographed or otherwise reproduced upon film, which photographic film shall comply with the minimum stand- ards of quality approved for permanent photographic records by the National Bureau of Standards. Such photographs, micro- photographs, or photographic film or copies thereof shall be deemed to be an original record for all purposes, including introduction in evidence in all State and Federal courts or administrative agencies and shall be proof of any act, transaction, occurrence, or event therein recorded. Such photographs, micro- photographs, or reproduction shall be pre- served in such manner as the Board of Di- rectors of the Corporation shall prescribe and the original records, papers, or docu- ments may be destroyed or otherwise disposed of as the Board chall direct. “Suc. 11, (a) The Temporary Federal De- posit Insurance Fund and the Fund For Mutuals heretofore created pursuant to the provisions of section 12B of the Federal Re- serve Act, as amended, are hereby consoli- dated into a Permanent Insurance Fund for insuring deposits, and the assets therein shall be held by the Corporation for the uses and purposes of the Corporation: Pro- vided, That the obligations to and rights of the Corporation, depositors, banks, and other persons arising out of any event or transac- tion prior to the effective date of this amend- ment shall remain unimpaired. On and after August 23, 1935, the Corporation shall insure the deposits of all insured banks as provided in this Act: Provided further, That the insurance shall apply only to deposits of insured banks which have been made avail- able since March 10, 1938, for withdrawal in the usual course of the banking business: further, That if any insured bank shall, without the consent of the Corpora- tion, release or modify restrictions on or Geferments of deposits which had not been meade available for withdrawal in the usual course of the banking business on or before 10667 August 28, 1985, such deposits shall not be insured. The maximum amount of the in- sured deposit of any depositor shall be 10,000: And provided further, That in the case of banks closing prior to the effective date of this amendment, the maximum amount of the insured deposit of any de- positor shall be 85,000. “(b) For the purposes of this act an in- sured bank shall be deemed to have been closed On account of inability to meet the demands of its depositois in any case in which it hag been closed for the purpose of liquidation without adequate provision being made for payment of its depositors, “(c) Notwithstanding any other provision of law, whenever the Comptroller of the Currency shall appoint a receiver other than &@ conservator of any insured national bank or insured District bank, he shali appoint the Corporation receiver for such closed bank. “(d) Notwithstanding any other provi- sion of law, it shall be the duty of the Cor- poration as such receiver to cause notice to be given, by advertisement in such news- papers as it may direct, to all persons hav- ing claims against such closed bank pursuant to section 6235 of the Revised Statutes (U. 8. C., title 12, sec. 193); to realize upon the assets of such closed bank, having due regard to the condition of credit in the local- ity; to enforce the individual liability of the stockholders and directors thereof; and to wind up the affairs of such closed bank in conformity with the provisions of law relat- ing to the HMquidation of closed national banks, except as herein otherwise provided. The Corporation as such recciver shall pay to itself for its own account such portion of the amounts realized from such lquidation as it shall be entitled to receive on account of its subrogation to the claims of depositors, and it shall pay to depositors and other cred- itors the net amounts available for distri- bution to them. The Corporation as such receiver, however, may, in its discretion, pay dividends on proved claims at any time efter the expiration of the period of advertisement made pursuant to the aforesaid section of the Revised Statutes, and no liability shall at- tach to the Corporation itself or as such receiver by reason of any such payment for failure to pay dividends to a claimant whose claim is not proved at the time of any such payment. With respect to any such closed bank, the Corporation as such receiver shall have all the rights, powers, and privileges now possessed by or hereafter granted by law to a receiver of a national bank or district bank and notwithstanding any other provi- sion of law in the exercise of such rights, powers, and privileges the Corporation shall not be subject to the direction or supervision of the Secretary of the Treasury or the Comptroller of the Currency. “(e) Whenever any insured State bank (except a district bank) shall have been closed by action of its board of directors or by the authority having supervision of such bank, as the case may be, on account of in- ability to meet the demands of its depositors, the Corporation shall accept appointment as receiver thereof, if such appointment is ten- dered by the authority having supervision of such bank and ts authorized or permitted by State law. With respect to any such in- sured State bank, the Corporation as such receiver shall possess all the rights, powers, and privileges granted by State law to a re- ceiver of a State bank. “({) Whenever an insured bank shall have been closed on account of inability to meet the demands of its depositors, payment of the ineured deposits in euch bank shall be made by the Corporation as soon as possible, subject to the provistons of subsection (g) of this section either (1) by cash or (2) by making available to each depositor a trans- ferred deposit in a new bank in the same community or in another insured bank in an amount equal to the insured deposit of such
10668 depositor and subject t> withdrawal on de- mand: Provided, That the Corporation, in its discretion, may require proof of claims to be filed before paying the insured deposits, and that in any case where the Corporation ig not satisfied as to the validity of a claim for an insured deposit, it may require the final determination of a court of competent jurisdiction before paying such claim. “(g) In the case of a closed national bank or District bank, the Corporation, upon the payment to any depositor as provided in subsection (f) of this section, shall be sub- rogated to all rights of the depositor against the closed bank to the extent of such pay- ment. In the case of any other closed in- sured bank, the Corporation shall not make any payment to any depositor until the right of the Corporation to be subrogated to the rights of such depositor on the same basis as provided in the case of a closed national bank under this act shall have been recog- nized elther by express provision of State law, by allowance of claims by the authority having supervision of such bank, by assign- ment of claims by depositors, or by any other effective methcd. In the case of any closed insured bank, such subrogation shall include the right on the part of the Corporation to receive the same dividends from the pro- ceeds of the assets of such closed bank and recoveries on account of stockholders’ lia- bility as would have been payable to the depositor on a claim for the insured deposit, put such depositor shall retain his claim for any uninsured portion of his deposit: Pro- vided, That, with respect to any bank which closes after May 25, 1938, the Corporation shall waive, in favor only of any person against whom stockholders’ individual lia- bility may be asserted, any claim on account of such liability in excess of the ability, if any, to the bank or its creditors, for the amount unpaid upon his stock in such bank; but any such waiver shall be effected in such manner and on such terms and con- ditions as will not increase recoverics or dividends on account of claims to which the Corporation ig not subrogated: Prorided further, That the rights of depositors and other creditors of any State bank shall be determined in accordance with the applicable provisions of State law “(h) As soon as possible after the closing of an insured bank, the Corporation, if it finds that it is advisable and in the interest of the depositors of the closed bank or the public, shall organize a new national bank to assume the insured deposits of such closed bank and otherwise to perform temporarlly the functions hereinafter provided for. The new hank shall have its place of business in the same community as the closed bank. “(1) The articles of association and the orgnnization certificate of the new bank shall be executed by representatives designated by the Corporation. No capital stock need be paid in by the Corporation. The new bank shall not have a board of directors, but shell be mannged by an executive officer appointed by the Borrd of Directors of tie Corporation who shall be subject to its directions. In all other respects the new bank shall be organ- ived in accordance with the then existing provisions of law relating to the organization of national banking assoctations. The new bank may, with the approval of the Corpo- ration, accept new deposits which shall be subject to withdrawal on demand and which, except where the new bank ts the only bank in the community, shall not excced $10,000 from any depositor. The new bank, without application to or approval by the Corpora- tion, shall be an insured bank and shall maintain on deposit with the Federal Reserve bank of its district reserves in the amount required by law for member banks, but it shall not be required to subscribe for stock of the Federal Reserve bank. Funds of the new bank shall be kept on hand in cash, in- vested in obliyations of the United States, or 1n obligations guaranteed as to principal and CONGRESSIONAL RECORD—HOUSE interest by the United States, or deposited with the Corporation, with a Federal Re- serve bank, or, to the extent of the insur- ance coverage thereon, with an insured bank. The new bank, unless otherwise authorized by the Comptroller of the Currency, shall transact no business except that authorized by this act and as may be incidental to its organization. Notwithstanding any other provision of law the new bank, its franchise, property, and income shall be exempt from all taxation now or hereafter imposed by the United States, by any Territory, dependency, or possession thereof, or by any State, county, municipality, or local taxing authority, “(J) Upon the organization of a new bank, the Corporation shall promptly make avatl- able to it an amount equal to the estimated insured deposits of such closed bank plus the estimated amount of the expenses of Op- erating the new bank, and shall determine as soon as possible the amount due each de- positor for his insured deposit in the closed bank, and the total expenses of operation of the new bank. Upon such determination, the amounts so estimated and made available shall be adjusted to conform to the amounts so determined. Earnings of the new bank shall be paid over or credited to the Corpora- tion in such adjustment. If any new bank, during the period it continues its status as such, sustains any losses with respect to which it is not effectively protected except by reason of being an insured bank, the Corporation shall furnish to it additional funds in the amount of such losses. The new bank shall assume as transferred de- posits the payment of the insured deposits of such closed bank to each of its depositors. Of the amounts so made available, the Cor- poration shall transfer to the new bank, in cash, such sums as may be necessary to en- able it to meet its expenses of operation and immediate cash demands on such transferred deposits, and the remainder of such amounts shall be subject to withdrawal by the new bank on demand. “(k) Whenever in the judgment of the Board of Directors it is desirable to do so, the Corporation shall cause capital stock of the new bank to be offered for sale on such terms and conditions as the Board of Direc- tors shall dcem advisable in an amount suffi- cient, in the opinion of the Board of Direc- tors, to make possible the conduct of the business ot the new bank on a sound basis, but in no event less than that required by section 5138 of the Revised Statutes, as amended (U.S. C, title 12, sec. 51), for the organization of a national bank in the place where such new bank is located. The stock- holders of the closed insured bank shall be given the first opportunity to purchase any shares of common stock s0 offered. Upon proof that an adequate amount of capital stock in the new bank has been subscribed and paid for fn cash, the Comptroller of the Curreney shall require the articles of asso- ciation and the organization certificate to be amended to conform to the requirements for the organization of a national bank, and theresfter, when the requirements of law with respect to the organization of a na- tional bank have been complied with, he shall issue to the bunk a certificate of au- thority to commence business, and there- upon the bank ehall cease to have the status of a new bank, shall be managed by directors elected by its own shareholders und may excercise all tho powers granted by law, and it shall be subject to all the provisions of law relating to national banks. Such bank shall thereafter be an insured national bank, with- out certification to or approval by the Cor- poration. “(1) If the capital stock of the new bank is not offered for sale, or if an adequate amount of capital for such new bank is not subscribed and paid for, the Board of Direc- tors may offer to transfer its business to any insured bank in the same community which will take over its assets, assume its Habili- JULY 19 ties, and pay to the Corporation for such business such amount as the Board of Direc- tors may deem adequate; or the Board of Directors in its discretion may change the location of the new bank to the office of the Corporation or to some other place or may at any time wind up its affairs as herein provided. Unless the capital stock of the new bank is sold or its assets are taken over and its lfabilities are assumed by an insured bank as above provided within 2 years from the date of its organization, the Corporation shall wind up the affairs of such bank, after giving such notice, if any, as the Comptroller of the Currency may require, and shall certify to the Comptroller of the Currency the termi- nation of the new bank. Thereafter the Cor- poration shall be liable for the obligations of such bank and shall be the owner of its assets. The provisions of sections 5220 and 5221 of the Revised Statutes (U. S. C., title 12, secs. 181 and 182) shall not apply to such new banks, “Sec. 12. (a) Notwithstanding any other provision of law, the Corporation as receiver of a closed national bank or District bank shall not be required to furnish bond and shall have the right to appoint an agent or agents to assist it in its duties as such re- ceiver, and all fees, compensation, and ex- penses of liquidation and administration thereof shall be fixed by the Corporation, and may be paid by it out of funds coming into its possession as such receiver. “(b) Payment of an insured deposit to any person by the Corporation shall discharge the Corporation, and payment of a trans- ferred deposit to any person by the new bank or by an insured bank in which a trans- ferred deposit has been made available shall discharge the Corporation and such new bank or other insured bank, to the same extent, that payment to such person by the closed bank would have discharged it from lability for the insured deposit. “(c) Except as otherwise prescribed by the Board of Directors, neither the Corporation nor such new bank or other insured bank shall be required to recognize as the owner of any portion of a deposit appearing on the records of the closed bank under a name other than that of the claimant, any per- son whose name or interest as such owner is not disclosed on the records of such closed bank as part owner of said deposit, if such recognition would increase the agrregate amount of the insured deposits tn such closed bank. “(d) The Corporation may withhold pay- ment of such portion of the insured deposit of any depositor in a closed bank as may be required to provide for the payment of any liability of such depositor as a stock- holder of the closed bank, or of any lability of such depositor to the closed bank or its receiver, which is not offset against a claim due from such bank, pending the dctermi- nation and payment of such Habllity by such depositor or any other person Mable therefor. “(e) If, after the Corporation shall have given at least 8 months’ notice to the de- positor by mailing a copy thereof to his last~ known addrers appearing on tho records of the closed bank, any depositur in the closed benk shall frail to claim his insured deposit from the Corporation within 18 months after the appointment of the re- ceiver for the closed bank, or shall fail within such period to clatm or arrange to con- tinue the transferred deposit with the new bank or with the other insured bank which agsumes liability therefor, all rights of the depositor against the Corporation with re- spect to the Insured deposits, and against the new bank and such other insured bank with respect to the transferred deposit, shail be barred, and all rigits of the depositor against the closed bank and its sharehold- ers, or the receivership estate to which the Corporation may have become subrogated, shall thoreupon revert to the depositor. The
1950 amount of any tiansferred deposits not claimed within such 18 months’ period, shal] be refunded to the Corporation. “Sec 13 (8) Money of the Corporation not otherwise employed shall be invested in obligations of the United States or in obliga- tions guaranteed as to principal and interest by the United States: Provided, That the Corporation shall not sell or purchase any such obligations for its own account and in its own right and interest, at any one time aggregating in excess of $100,000, without the approval of the Secretary of the Treasury. And provided further, That the Secretary of the Treasury may waive the requirement of his approval with respect to any transaction or classes of transactions subject to the pro- visions of this subsection for such period of time and under such conditions as he may determine. “(b) The banking or checking accounts of the Corporation shall be kept with the Treasurer of the United States, or, with the approval of the Secretary of the Treasury, with a Federal Reserve bank, or with a bank designated as a depositary or fiscal agent of the United States: Piowvded, That the Secre- tary of the Treasury may waive the requires ments of this subsection under such con- ditions as he may determine And provided further, That this subsection shall not ap- ply to the establishment and maintenance in any bank for temporary purposes of banking and checking accounts not in excess of $50,000 in any one bank, or to the establishment and maintenance in any bank of any banking and checking accounts to facilitate the payment of insured deposits, or the making of loans to, or the purchase of assets of, insured banks. When desig- nated for that purpose by the Secretary of the Treasury, the Corporation shall be a de- positary of public moneys, except receipt from customs, under such regulations as may be prescribed by the said Secretary, and may also be employed as a financial agent of the Government. It shall perform all such reasonable duties as depositary of pub- lic moneys and financial agent of the Gov- ernment us muy be required of it “(c) In order to reopen a closed insured bank o1, when the Corporation has deter- mined that an insured bank ts in dange: of closing, in order to prevent such closing, the Corporation, in the discretion of its Board of Directors, is authorized to make loans to, or purchase the assets of, or make deposits in, such insured bank, upon such terms and conditions as the Board ot Directors may prescribe, when in the opinion of the Boaid ot Dhecto1s the continued operation of such bank is essential to provide adequate bank- ing service in the community. Such loans and deposits may be in subordination to the rights of depositors and other creditors “(d) Receivers or liquidators of insured banks closed on account of inability to meet the demands of their depositors shall be entitled to offer the assets of such banks for sule to the Corporation or as security for loans from the Corporation, upon receiving permission from the appropriate Stato au- thority in accordance with express pro- visions of State law in the case of insured State banks The proceeds of every such sale or loan shall be utilized for the same purposes and in the same manner as othe. funds realized from the liquidation of the assets of such banks, In any case where piior to the effective date of this amend- ment, the Comptroller of the Currency has appointed a receiver of a closed national bank other than the Corporation, he muy, in his discretion, pay dividends on proved claims at any time after the expiration of the period of advertisement made pursuant to section 5235 of the Revised Statutes (U.S C, title 12, sec. 198), and no ability shall attach to the Comptroller of the Cur- rency or to the rece!ver of any such national bank by reason of any such payment tor failure to pay dividends to a claimant whose XCVI-——672 CONGRESSIONAL RECORD—HOUSE claim is not proved at the time of any such payment. The Corporation, In its discretion, may make loans on the security of or may purchase and liquidate or sell any part of the assets of an insured bank which is now or may hereafter be closed on account of inability to meet the demands of its de- positors, but in any case in which the Cor- poration is acting as receiver of a closed insured bank, no such Joan or purchase shall be made without the approval of a court of competent jurisdiction. “(e) Whenever in the judgment of the Board of Directors such action will reduce the risk or avert a threatened loss to the Corporation and will facilitate a merger or consolidation of an insured bank with another insured bank, or will facilitate the sale of the assets of an open or closed in- sured bank to and assumption of its labili- ties by another insured bank, the Corpoia- tion may, upon such terms and conditions as it may determine, make loans secured in whole or in part by asscts of an open or closed insured bank, which loans may be in subordination to the rights of depositors and other creditors, or the Corporation may purchase any such assets or may guarantee any other insured bank against loss by rea- son of tts assuming the Ilabilities and pur- chasing the assets of an open or closed in- sured bank Any insured national bank or District bank, or the Corporation as re- ceiver thereof, is authorized to contract for such sales or loans and to pledge any assets of the bank to secure such loans “(f) Prior to July 1, 1951, the Corporation shall pay out of its capital account to the Secretary of the Tieasury and the Federal Reserve banks, respectively, an amount equal to 2 percent simple interest per annum on amounts advanced to the Corporation on stock subscriptions by the Secretary of the Treasury and such banks, from the time of such advances until the amounts thereof were repaid “Sec 14 The Corporation is authorized to borrow from the Treasury, and the Secretary of the Treasury ts authorized and directed to loan to the Corporation on such terms as may be fixed by the Corporation and the Sec- retary, such funds as in the judgment of the Boaid of Directors of the Corporation are from time to timo required for insurance purposes, not exceeding in the arrregate $3,000,000,000 outstanding at any one lime Promded, That the rate of interest to be charged in connection with any loan made pursuant to this section shall not be less than the current average rate on outstanding marketable and nonmarketable obligations of the United States as of the last day of ihe month preceding the making of such loan. For such purpose the Sccietary of the Treasury is authorized to use as a publiic- debt transaction the proceeds of the sale of any securities hereafter issued under the Second Liberty Bond Act, as amended, and the purpo.es for which securities may be jssued under the Second Libeity Bod Act, as amended, are extended to include such loans Any svch loan shall be ured by the Corporation solely in carrying out its func- tions with respect to such insuiance. All loans and repayments under this section slall be treated as public-debt transactions of the United States. “Src. 16 All notes, debentures, bonds, or other such oblgations issued by the Corpo- ration shall be exempt, both ns to principal and interest, trom all taxation (except cotate and inheritance taxes) now or hereafter im- posed by the United States, by any Territory, dependency, or possession thereof, or by auy State, county, municipality, or local taxing authority’ Provided, That interest upon or any income from any such obligatious and gain from the sale or other disposition of such obligations shall not have any exemp- tion, as such, and loss from the sale or other disposition of such obligations shall not have any special treatment, as such, under the 10669 Internal Revenue Code, or laws amendatory or supplementary thereto. The Corporation, including its franchise, its capital, reserves, and surplus, and its income, shall be exempt from all taxation now or hereafter imposed by the United States, by any Territory, de- pendency, or possession thereof, or by any State, county, municipality, or local taxing authority, except that any real property of the Corporation shall be subject to State, Territorial, county, municipal, or local tax- ation to the same extent according to its value as other real property is tuxed. “Sec. 16. In order that the Corporation may be supplied with such forms of notes, debentures, bonds, or other such obligations as it may need for issuance under this act, the Secretary of the Treasury 1s authorized to prepare such forms as shall be suitable and approved by the Corporation, to be held in the Treasury subject to delivery, upon order of the Corporation. The engraved plates, dies, bed pieces, and other material executed in connection therewith shall re- muin in the custody of the Secretary of the Treasury. The Corporation shall reimburse the Secretary of the Treasury for any ex- penses incurred in the preparation, custody, and delivery of such notes, debentures, bonds, or other such obligations. “Sec 17. (a) The Corporation shall annu- ally make a report of its operations to the Congress a8 soon as practicable after the ist day of January In each year. “(b) The financial transactions of the Corporation shall be audited by the General Accounting Office in accordance with the principles and procedures applicable to com- mercial corporate transactions and under such rules and regulations as may be pre- scribed by the Comptroller General of the United States. The audit shall be conducted at the place or places where accounts of the Corporation are normally kept The rep- resentatives of the General Accounting Office shall have access to all books, accounts, rec- ords, reports, files, and all other papers, things, or property belonging to or in use by the Corporation pertaining to its financial transactions and necessary to facilitate the nudit, and they shall be afforded full facill- ties, for verifying transoctions with the bal- ances or securities held by depositaries, fiscal agents, and custodians All such books, ac- counts, records, reports, files, papers, and property of the Corporation shall remain in possession and custody of the Corporation. The audit shall begin with financial trans- actions occurring on and after August 31, 1948, “(c) A report of the nudit for each fiscal year ending on June 30 shall be made by the Comptroller General to the Congress not later than January 16 following the close of such fiscal year On or before December 15 following such fiscal year the Comptroller General shall furnish the Corporation a short form report showing the finencial po- sition of the Corporation at the close of the fiscal year The report to the Congress shall set forth the scope of the audit and shall include a statement of assets and Mabilittes and surplus or deficit, a statement of surplus or deficit analysis, a statement of income and expenses, a statement of sources and ape plication of funds and such comments and Information as may be desmed necessary to inform Cougress of the finaucial operations and condition of the Corporation, togothcr with ruch recommendations with respect . thereto as the Comptroller General nmisy deem odvisable. The report shall also show specifically any progiam, expenditure, or other financial transaction or undertaking observed in the course of the audit, which, in the opinion of the Comptroller General, has been cairied on or made without au- thority of law. A copy of each report shall be furnished to the President, to the Sec- retary of the Tre.sury, and to the Corpota- tion at the time submitted to the Congress,
10670 *(d) For the purpose of conducting such audit the Comptroller General is authorized in his discretion to employ by contract, with- out regard to section 8709 of the Revised Statutes, professional services of firms and organizations of certified public accountants, with the concurrence of the Corporation, for temporary periods or for special purposes, The Corporation shall reimburse the Gen- eral Accounting Office for the cost of any euch audit as billed therefor by the Comp- troller General, and the General Accounting Office shall deposit the sums so reimbursed into the Treasury as miscellaneous recetpts. “Sec. 18 (a) Every insured bank shall dis- play at each place of business maintained by it a sign or signs, and shall include in advertisements relating to deposits a state- ment, to the effect that its deposits are in- sured by the Corporation. The Board of Directors shall prescribe by regulation the forms of such signs and the manner of dis- play and the substance of such statements and the manner of use. For each day an in- sured bank continues to violate any provi- sions of this subsection or any lawful provi- sions of sald regulations, it shall be subject to a penalty of not more than $100, which the Corporation may recover for its use. “(b) No insured bank shall pay any divi- dends on its capital stock or interest on its capital notes or debentures (if such interest is required to be paid only out of net profits) or distribute any of its capital assets while it remains in default in the payment of any assessment due to the Corporation; and any director or officer of any insured bank who participates in the declaration or pay- ment of any such dividend or interest or in any such distribution shall, upon con- viction, be fined not more than $1,000 or im- prisoned not more than 1 year, or both: Provided, That, if such default is due to a dispute between the insured bank and the Corporation over the amount of such assess- ment, this subsection shall not apply, if such bank shall deposit security satisfactory to the Corporation for payment upon final determination of the issue. “(c) Without the prior written consent of the Corporation, no insured bank shall (1) merge or consolidate with any noninsured bank or tnatitution or convert into a non- insured institution or assume ability to pay any deposits made in, or similar liabilities of, any noninsured bank or institution or (2) transfer assets to any noninsured bank or institution in consideration of the assump- tion of Hability for any portion of the de- posits made in such insured bank, and no insured State nonmember bank (except a District bank) without such consent shall reduce the amount or retire any part of its common or preferred capital stock, or retire any part of its capital notes or debentures. “(a) No State nonmember insured bank (except a District bank) shall establish and operate any new branch unless it shall have the prior written consent of the Corporation, and no State nonmember insured bank (ex- cept a District bank) shall move its main office or any branch from one location to another without such consent The factors to be considered in granting or withholding the consent of the Corporation under this subsection shall be those enumerated in sec- tion 6 of this act “(e) The Corporation may require any Ansured bank to provide protection and in- demnity against burglary, defalcation, and other similar insurable losses. Whenever any insured bank refuses to comply with any such requirement the Corporation may con- tract for such protection and indemnity and add the cost thereof to the assessment other- wise payable by such bank. “(f) Whenever any insured bank (except a national bank or a District bank), after written notice of the recommendations of the Corporation based on a report of exami- nation of such bank by an examiner of the CONGRESSIONAL RECORD—HOUSE Corporation, shall fall to comply with such recommendations within 120 days after such notice, the Corporation shall have the power, and is hereby authorized, to publish only such part of such report of examination as relates to any recommendation not complied with: Provided, That notice of intention to make such publication shall be given to the bank at least 80 days before such publication is made. “(g) The Board of Directors shall by regu- lations prohibit the payment of interest on demand deposits in insured nonmember banks and for such purpose it may define the term ‘demand deposits’; but such ex- ceptions from this prohibition shall be made ag are now or many hereafter be prescribed with respect to deposits payable on demand in member banks by section 19 of the Federal Reserve Act, as amended, or by regulation of the Board of Governors of the Federal Re- serve Systemr. The Board of Directors shall from time to time Mmit by regulation the rates of interest or dividends which may be paid by insured nonmember banks on time and savings deposits, but such regulations shall be consistent with the contractual oblil- gations of such banks to their depositors, For the purpose of fixing such rates of inter. est or dividends, the Board of Directors shall by regulation prescribed different rates for such payment on time and savings deposits having different maturities, or subject to different conditions respecting withdrawal or repayment, or subject to different conditions by reason of different locations, or according to the varying discount rates of member banks in the several Federal Reserve districts, The Board of Directors shall by regulation define what constitutes time and savings deposits in an insured nonmember bank. Such regulations shall prohibit any insured nonmember bank from paying any time de- posit before its maturity except upon such conditions and in accordance with such rules and regulations as may be prescribed by the Board of Directors, and from waiving any requirement of notice before payment of any savings deposit except as to all savings de- posits having the same requirement For each violation of any provision of this sub- section or any lawful provision of such regu- lations relating to the payment of interest or dividends on deposits or to withdrawal of deposits, the offending bank shall be subject to a penalty of not more than $100, which the Corporation may recover for its use. “(h) Any insured bank which willfully falls or refuses to file any certified state- ment or pay any assessment required under this act shall be subject to a penalty of not more than $100 for each day that such viola- tions continue, which penalty the Corpora- tion may recover for its use: Provided, That this subsection shall not be applicable under the circumstances stated in the proviso of subsection (b) of this section “Sec. 19 Except with the written consent of the Corporation, no person shall serve as a director, officer, or employee of an in- sured bank who has been convicted, or who is hereafter convicted, of any criminal of- fense involving dishonesty or a breach of trust. For each willful violation of this pro- hibition, the bank involved shall be subject to penalty of not more than 8100 for each day this prohibition is violated, which the Corporation may recover for its use “Sec 20. It is not the purpose of this act to discriminate in any manner against State nonmember banks and in favor of national or member banks; but the purpose ts to provide all banks with the same opportunity to ob- tain and enjoy the benefits of this act. No bank shall be discriminated against because its capital stock is less than th? amount re- quired for eligibility for admission into the Federal Reserve System. “Sxc, 21. The provisions of this act limiting the insurance of the deposits of any de- positor to a maximum less than the full amount shall be independent and separable JULY 19 from each and all of the provisions of this act” Src. 8. The third paragraph of section 709, title 18, United Etates Code, is amended to read as follows: “Whoever, except as expressly authorized by Federal law, uses the words ‘Federal De- posit,’ ‘Federal Deposit Insurance,’ or ‘Fed- eral Deposit Insurance Corporation’ or a combination of any three of these words, as the name or a part thereof under which he or it does business, or advertises or other- wise represents falsely by any device what- soever that his or its depoalt Mabilities, obli- gations, certificates, or shares are insured or guaranteed by the Federal Deposit Insur- ance Corporation, or by the United States or by any instrumentality thereof, or who- ever advertises that his or its deposits, shares, or accounts are federally insured, or falsely advertises or otherwise represents by any device whatsoever the extent to which or the manner in which the deposit Mabilities of an insured bank or banks are insured by the Federal Deposit Insuranc Corporation; or.” Src, 4 Section 220, title 18, United States Code, is amended to read as follows: “Whoever, being an officer, director, em- ploye, agent, or attorney of any bank, the deposits of which are insured by the Federal Deposit Insurance Corporation, of a Federal intermediate credit bank, or of a National Agricultural Credit Corporation, except as provided by law, stipulates for or receives or consents or agrees to receive any fee, com- mission, gift, or thing of value, from any person, firm, or corporation, for procuring or endeavoring to procure for such person, firm, or corporation, or for any other person, firm, or corporation, from any such bank or corporation, any loan or extension or re- newal of loan or substitution of security, or the purchase or discount or acceptance of any paper, note, draft, check, or bill of ex- change by any such bank or corporation, shall be fined not more than $5,000 or imprisoned not more than 1 year or both.” Mr. SPENCE (interrupting the reading of the bill). Mr. Chairman, I ask unanimous consent that the bill be con- sidered as read, that the bill and com- mittee amendments be printed, that the committee amendments be considered at this time and that the bill be open for amendment at any point. At the con- clusion of the reading of the committee amendments, which are not controver- sial, I shall move that the Committee rise. The CHAIRMAN. Is there objection to the request of the gentleman from Kentucky? There was no objection. The Clerk read the committee amend- ments, as follows: Page 12, strike out Hnes 10 and 11 and substitute in Meu thereof the following. “drafts drawn by it on deposit accounts in other banks which are issued in the regular course of business; and the amount of any advices or authorizations, issued by it for cash letters received, directing that its de- posit account in the sending bank be charged with the amount thereof.” Page 13, Mne 2, insert “semiannual” im- mediately before the word “period.” Page 25, line 2, beginning with the word “Except”, strike out all down to and in- cluding the word “brought” on line 5, Page 26 immediately following line 10 in- sert the following: “Eleventh. When approved by the Presi- dent, the Corporation is hereby authorized to purchase a building or to acquire a site at the seat of the Federal Government and to construct thereon a bullding suitable for the use of the Corporation, at a total cost of not to exceec $15,000,000 for building and site, to
1950 be paid for by the Corporation and any pay- ment or payments of such cost shall be con- sidered as operating costs and expenses of the Corporation in determining net assess- ment income under section 7 (d) of this act: Provided, That the selection of such site shall be subject to the approval of the Na- tional Capital Park and Planning Commis- sion, and that the design for such building shall be subject to the approval of the Com- mission of Fine Arts: Provided further, That the facilitios of the Administrator of General Services shall be utilized, in the manner ap- proved by the Corporation, in the acquisition of such site, the preparation of all necessary plans, drawings, and specifications, the mak- ing of all necessary contracts, and the super- vision of the construction of such buildings and said Administrator shall provide any other available facilities, including steam, upon request of the Corporation. Upon re- quest of the Corporation the Administrator of General Services is authorized to spend funds for advance planning to prepare draw- ings and specifications prior to the approval of the title to any such acquisition. The Corporation shall reimburse the Administra- tor of General Services for any costs and ex- penses in furnishing such services and facili- ties in such amount as may be agreed to by the Corporation and the Administrator of General Services. The Board of Directors shall have exclusive authority to manage and service said building and to determine and provide for all of the Corporation’s office space requirements.” Page 28, strike out wll of nes 9 through 17 and “bank”, on line 18, and insert in lieu therof the following: “examine any insured bank, any bank making application to be- come an insured bank, and any closed in- sured bank, whenever in the judgment of the Board of Directors an examination of the bank is necessary.” Page 81, line 18, strike out “proof of” and inseit in lieu thereof “admissible to prove.” Page 34, line 21, insert after ‘bank’, the following “or of any noninsured national bank or district bank hereafter closed.” Page 36, line 25, strike out “and subject to withdrawal on demand.” Page 46, lines 18 and 19, strike out “Corpo- ration has determined that an insured bunk 4s in danger of closing” and insert in lieu thereof “Board of Directors deems it necessary.” Page 46, line 20, strike out “such closing” and insert in lieu thereof “the closing of an insured bunk.” Page 46, tine 23, strike out “or make dc- posits in.” Page 46, line 24, beginning with the word “prescribe” strike out all down to and in- cluding “community.” on page 47, line 2, and insert in Heu thereof “prescribe.” Page 47, line 2, strike out “and deposits ” Page 49, immediately following line 2 add the following new paragraph: “No agreement which tends to diminish or defeat the right, title, or interest of the Corporation in any asset acquired by it under this section, either as security for a loan or by purchase, shall be valid against the Cor- poration unless such agreement (1) shall be in writing, (2) shall have been executed by the bank and the person or persons claim- ing an adverse interest thereunder, including the obligor, simultaneously with the acquisi- of the asset by the bank, (8) shall have been approved by the board of directors of the bank or its loan committee, which approval shall be reflected in the minutes of said board or committee, and (4) shall have been, con- tinuously, from the time of its execution, an Official record of the bank.” Page 49, line 17, strike out “out of its cap- ital account.” Page 49, line 18, strike out “and the Fed- eral Reserve banks, respectively.” Page 49, line 21, strike out “such” and in- sert in Meu thereof “the Federal Reserve.” CONGRESSIONAL RECORD—HOUSE Page 49, at the end of line 23, add the fol- lowing sentence: “The amount payable here- under shall be considered as operating costs and expenses of the Corporation in determin- ing the net assessment income under section 7 (d) of this act.” Page 64, line 18, strike out “in advertise- ments relating to deposits”; and on line 19 Strike out the comma, Page 54, line 20, insert immediately before the period the following: “in all of its ad- vertisements: Provided, That the Board of Directors may exempt from this requirement advertisements which do not relate to de- posits or when it is impractical to include such statement therein.” Page 59, line 23, insert “(a)” following “Src. 3.” The committee amendments were agreed to. The Clerk read as follows: Committee amendment: Page 60, imme- diately following line 14, insert the following new subsection: “(b) The eleventh paragraph of section 709, title 18, United States Code, is amended by adding the following new sentence at the end thereof: ‘The use of the contraction “Federal Savings Insurance Corporation” or the initials “FSIC” shall not be construed as a violation of this section,’” Mr. WOLCOTT. Mr. Chairman, I re- serve a point of order against the amend- ment. I do not think that the point of order will be disposed of this afternoon, and I do not know that I will press the point of order. I ask unanimous consent that my reservation of the point of order upon this amendment be con- sidered after the consideration of other amendments to the bill. The CHAIRMAN. Is there objection to the request of the gentleman from Michigan? There was no objection. The Clerk read as follows: Committee amendment’ Page 61, iImme- diately following Mine 13, add the following new section: “Src. 6. Subsection (b) of section 405 of title IV of the National Housluig Act, as amended, is amended to read ag follows: “(b) In the event of a default by any insured institution, payment of each insured account in such insured institution which is surrendered and transferred to the Cor- poration shall be made by the Corporation as soon as possible either (1) by cash or (2) by making available to each insured mem- ber a transferred account in a new insured institution in the same community or in another insured institution in an amount equal to the insured account of such insured member: Provided, That the Corporation, in its discretion, may require proof of claims to be filed before paying the insured ac- counts, and that in any case where the Cor- poration is not satisfied as to the validity of a claim for an insured account, it muy re- quire the final determination of a court of competent jurisdiction before paying such claim.’ " Mr. WOLCOTT. Mr. Chairman, I make the same reservation of a point against that amendment. The CHAIRMAN. Without objection, it is so ordered. There was no objection. The CHAIRMAN. Are there any other committee amendments? Mr. SPENCE. There are _ other amendments, Mr. Chairman, that may be controversial, that are not committee amendments, 10671 Mr. WOLCOTT. Mr. Chairman, if the gentleman will yield, I might say that I do not think the amendment which I understand the gentleman from Kentucky is to offer on page 45, is con- troversial, if the gentleman will offer it now. Mr, SPENCE. No; it is not contro- versial. I do not think there is any ob- jection to it; in fact, I am sure there is not. Mr. Chairman, I offer an amendment. The Clerk read as follows: Amendment by Mr. SPENCE: On page 15, line 4, strike out “1949, and” and insert in Neu thereof “1950, and as of December 81 of.” On page 15, line 9, after the word “bank”, insert “becoming due,” and strike out the words “Such credits” and insert in lieu thereof ‘Each yoar such credit.” On page 15, line 11, strike out the word “assessments” and insert in lieu thereof “assessment.” On page 15, line 12, insert before the period the following “and any excess credit shall be applied upon the assessment next be- coming due.” The amendment was agreed to. Mr. SPENCE. Mr. Chairman, I move that the Committee do now rise. The motion was agreed to. Accordingly the Committee rose; and the Speaker having resumed the chair, Mr. Foranpo, Chairman of the Commit- tee of the Whole House on the State of the Union, reported that that Commit- tee, having had under consideration the bill (S. 2822) to amend the Federal De- posit Insurance Act (U.S. C., title XII, sec. 264), had come to no resolution thereon. GENERAL LEAVE TO EXTEND REMARKS Mr. SPENCE. Mr. Speaker, I ask unanimous consent that all Members may have five legislative days to extend their remarks on the bill S. 2822. The SPEAKER. Is there objection to the request of the gentleman from Ken- tucky? There was no objection. AMENDING SYNTHETIC LIQUID FUELS ACT Mr. PETERSON. Mr. Speaker, I ask unanimous consent for the immediate consideration of the bill (H. R. 8975) to amend the Synthetic Liquid Fucls Act, as amendcd. The Clerk read the title of the bill. The SPEAKER. Is there objection to the requcst of the gentleman from Floriia? Mr. CRAWFORD. Reserving the right to object, Mr. Speaker, will the chairman of the committee explain the 11? Mr PETEREON. This is an extension of the synthetic fuels bill, moving up the period 3 years longer, and providing ad- ditional funds during that period of time. An extension came up on a previous oc- casion and it passed the House unani- mously. It has done good work. The time is just about to expire. The funds run out the early part of next year and the actual life runs out the spring of the following year. Mr. CRAWFORD. In other words, this Synthetic Fuels Act started back in 1944, when the Congress laid down the
10672 policy of developing synthetic fuels from oil shale, lignite coal, gasification of coal underground, and the production of syn- thetic gas, at which time we appropriated some $30,000,000 to be spent over a 5- year period for research and pilot-plant work, Mr. PETERSON. ‘Yes. Mr. CRAWFORD. At the end of 1948, I believe, we extended it another 3 years. Mr, PETERSON. That is correct. Mr. CRAWFORD. We gave them then an appropriation of $30,000,000. This is a third extension, for an addi- tional 3 years, with an appropriation of $27,600,000. Mr. PETERSON. That is correct. Mr. CRAWFORD. This give us an ll-year program with a total expendi- ture of $87,600,000. Mr. PETERSON. That is correct. Uniformly industry and Government have praised the program. It has been of untold benefit. Mr. CRAWFORD. That is my under- standing. I withdraw my reservation of objection, Mr. Speaker. Mr. PHILLIPS of California. Reserv- ing the right to object, Mr. Speaker, may I ask the gentleman if this is a bill to cover only a situation in which an éx- periment is being carried on to trans- pose, we will say, coal into a different type of fuel, or is it broad enough to cover a situation in which an experiment could be carried on to transpose the coal itself into power at the mine, instead of transporting the coal to be used some- where else for the production of power? Mr. PETERSON. We make no change in existing law. We merely extend the period. The existing Jaw provides for producing synthetic liquid fuels from coal, oil shale, and other substances. It is rather broad in its power. The gentleman from Michigan [Mr. CrawForp] may care to comment on the gentleman's question. He has given a great deal of study to this matter. Mr. CRAWFORD. The research in the pilot-plant work is doing an enor- mous amount of work in connection with the study of the gasification of coal at its natural location, or in the ground. Mr. PHILLIPS of California. Not only the gasification but actually the transfer of the coal into power there? Mr. CRAWFORD. That is correct. It covers every phase of the conversion of oil shale and lignite coal and bitumi- nous coal, and even peat, going into the question of peat bogs up in some of our States where the price of soft coal has now advanced to approximately $18 a ton, which becomes extremely burden- some. This covers the whole field. I have gone into the matter rather in detail with a large coal company, such as the Hannah Coal Co. and Babcock-Wilcox people, and all the oil people, such as Standard Oil, Phillips Petroleum, Pure Oil, and the big chemical companies, and as far as I can find out the administra- tion of these funds and this whole pro- gram is being carried on with extraor- dinary approval of all the different branches of the industry looking for- ward to giving us fuel at greatly reduced cost at the mine location, as the gentle- man has pointed out, CONGRESSIONAL RECORD—HOUSE Mr. PHILLIPS of California. Mr. Speaker, I thank the gentleman and withdraw my reservation of objection. Mr. STAGGERS. Mr. Speaker, the original synthetic fuel bill was passed in 1944. It was an emergency need be- cause of the war and we were running low on gasoline and oil. It was mainly for research and investigation in the mining operations and utilization of coal, petroleum, and other minerals. The original act was for a 5-year period. In 1948 it was extended for a 3-year pe- riod until April 5, 1952, and that is the intent of this new bill, H. R. 8975, to extend the act for another 3 years. To all intents and purposes we are at war again. The United States is hard pressed for chemicals and byproducts of coal and oil, and it is through such experimenta- tion as carried on in this work that they are discovered and made available to the American people. The program has been in operation now for 6 years and we cannot afford to stop it; as I said before, we are at war, and we do not want to be caught like we were with the synthetic-rubber in- dustry at the start of World War I, as an all-out contest between the ideol- ogies of communism and Christianity develops. As I have said many times in the past 2 years, I feel the ones who believe in these two theories will never be able to live side by side peacefully for one is based on godlessness and the other on the teachings of the Master of Galilee. This is a long-range program and is for the best interests of those Ameri- cans who are to come after us, for we are developing more and more into a me- chanical Nation in which we are need- ing all kinds of liquid fuels. This pro- gram does not put the Government in business at all, for oll the knowledge and modern methods developed in these plants is made available to all of the in- dustries of the Nation. As for the Morgantown plant, it is one of the fundamental research laboratories in the entire system. Since the pres- ent establishment is temporary and not now adequate for their needs, other quarters would have to be made avail- able in the form of a permanent plant. When this is done the work at this sta- tion will be increased to include service to the petroleum fields of the entire Ap- palachian region. I think it is one of the most important bills to come before the Congress at the present time. Mr. D'EWART. Mr. Speaker, reserv- ing the right to object, as a member of the Mines and Mining Subcommittee of the Committee on Public Lands we have gone into this bill to quite an extent. We have visited some of these plants, particularly the Rifie plant at Colorado. We have heard testimony from the Bureau of Mines, This is an important bill in connection with the war effort, You will remember that Germany de- pended very largely on synthetic fuels for the operation of its war machinery during the last war. You will also re- member that in this country we were very short of gasoline and other fuels. This experiment and this work to be car- ried on under this bill can be of im- JULY 19 measurable benefit to the country in sup- plementing our power resources for the war effort at the present time. I think it is important legislation and should be enacted. Mr. PETERSON. That was well de- veloped in the committee. The SPEAKER. Is there objection to the request of the gentleman from Florida (Mr. Peterson] ? There was no objection. The Clerk read the bill, as follows: Be it enacted, etc., That the Synthetic Liquid Fuels Act of April 6, 1944 (58 Btat. 190), as amended by the act of March 15, 1948 (62 Stat. 79), is further amended by changing the words “eight years” in the first sentence to read “eleven years”, and by changing the amount “860,000,000” in sec- tion 6 to read “685,000,000.” With the following committee amend- ment: Strike all after the enacting clause and insert in Heu thereof the following lan- guage: “That the Synthetic Liquid Fuels Act of April 5, 1944 (58 Stat. 190), as amended by the act of March 15, 1948 (62 Stat. 79), is further amended by changing the words “eight years" in the first sentence to read “eleven years,” and by changing the amount 860,000,000" in section 6 to read $87,600,000.” “Bec. 2. Of the sum authorized in section 1 of this act, not to exceed 82,600,000 shall be used for the construction and equip- ment of an experiment station in or near Morgantown, W. Va., for research and in- vestigation in the mining, preparation and utilization of coal, petroleum, natural gas, peat, and other minerals.” t The committee amendment was agreed 0. The bill was ordered to be engrossed and read a third time, was read the third time, and passed, and a motion to recon- sider was laid on the table. PERMISSION TO ADDRESS THE HOUSE Mr. MCCONNELL. Mr. Speaker, I ask unanimous consent to address the House for 1 minute. The SPEAKER. Is there objection to the request of the gentleman from Pennsylvania? There was no objection. PERSONAL ANNOUNCEMENT Mr. McCONNELL. Mr. Speaker, due to the fact of an operation to a member of my family in Philadelphia I was neces- sarily delayed in taking a train to the Capital today. Because of that I missed the vote on roll call No. 210 on the bill to amend the Mutual Assistance Act of 1949. If I had been here in time and voting, I would have voted ‘‘aye.” ORIME INVESTIGATION IN DISTRICT OF COLUMBIA Mr. STANLEY. Mr. Speaker, by di- rection of the Committee on House Ad- ministration, I offer a privileged resolu- tion (H. Res. 495), and ask for its im- mediate consideration. The Clerk read the resolution, as follows: Resolved, That the expenses of conducting the studies and investigations authorized by House Resolution 840, Eighty-first Con- gress, first seasion, incurred by the Committee on the District of Columbia, not to exceed $40,000, in addition to the funds authorized by House Resolution 396, Highty-first Con-
1950 gress, first session, including the expendi- tures for the employment of expert, special council, and clerical, stenographic, and other assistants, shall be paid out of the contingent fund cf the House on vouchers authorized by such committee, and signed by the chair- man of the committee, and approved by the Committes on House Administration. With the following committee amend- ment: Line 4, etrike out 840,000" and insert $20,000" in Meu thereof. Mr. LECOMPTE. Mr. Speaker, will the gentleman yield? tr, STANLEY. I yield. Mr. LECOMPTE. Ey this amendment the Co:.imittee on House Administration has cut the amount asked in two, is that not correci? Mr. STANLEY. The gentleman is correct Mr, LrCOMPTE. I want to say for the benefit of the House that the Com- mittce on House Administration has re- duced the amounts asked by all the spe- cial commuttees which have come bcfore the Subcommittee on Accounts. Of course, when the House by en over- whelming vote decides to have an in- vestigation, there is nothing that the Committee on House Administration can do but furnish the money for the investi- gation. But the subcommittes, headed by the gentleman from Virginia [Mr. Stanitey], and the committce headed by the gentlewoman from New Jersey | Mrs. Norron |, have tried to hold down these appropriations, and in practically every case have reduced the amount that has been asked for. Is that not truc? Mr. STANLEY. That is generally trus. I think some of the resolutions have gone through for the amounts as requcsted. Mr, LECOMPTE. There are three or four other similar resolutions which the gentleman proposes to submit to the House today? Mr. STANLEY. That is correct. Mr. LECOMPTE. The one presently before the House is for the expenses of the committee that is engaged in investi- gating crime in the District of Columbia, The District of Columbia has been de- scribed as the worst spot in the United States as far as crime is concerned. I do not know that that is true, but that has been said of Washington and the Dis- trict of Columbia. I believe the situation justifies the $20,000 that is asked for in this resolution. Mr, STANLEY. I thank the gentle- man. Mr. MARTIN of Massachusetts. Spesker, will the gentleman yield? Mr, STANLEY. I yield. Mr. MARTIN of Massachusetts. If the committee knows that crime is so bad in Washington, why do they not do some- thing about enforcing the laws instead of investigating crime? Mr. STANLEY. It is proposed, when the investigation is completed, to offer remedial legislation. Mr. MARTIN of Massachusetts. Well, why wait? ‘You say you know about it, Why not go ahead? Mr. STANLEY. The investigation has not been completed. Mr. CONGRESSIONAL RECORD—HOUSE Mr. MARTIN of Massachusetts. But do we not start to make prosecutions whenever we see crime is obvious? Mr. STANLEY. I understand the committee will bring in their final report as soon as they have completed their investigation. Mr. MARTIN of Massachusetts. The gentleman is not very definite in his statement. The committee agreed to. The resolution was agreed to. t A motion to reconsider was laid on the able. INVCESTIGATION BY COMMITTEE ON MER- CHANT MARINE AND FISHERIES Mr. STANLEY, Mr. Speaker, by di- rection of the Committee on House Ad- ministration, I offer a privileged resolu- tion (H. Res. 652), with an amendment, and ask for its immediate consideration. The Clerk read the resolution as fol- lows: Resolvcd, That the expenses of the investi- gation to be conducted pursuant to House Resolution 643, by the Committce on Mer- chant Marine and Ficheries, acting as a whole or by rubcommittec, not to exceed $25,000, including expenditures for the employment ot investigators, atiorneys, and clerical, stenographic, and other assistants, shall be paid out of the contingent fund of the House on vouchers authorized by such committee or subcommittee, signed by the chairman of such committee or subcommittee, and ap- proved by the Committee on House Admin- istration Committee amendments: Strike out $25,600" and insert “$15,090.” Strike out the words “or subcommittee.” The committee amendments were agreed to. The resolution was agreed to. A motion to reconsider wa: laid on the table. INVESTIGATION BY SPECIAL COMMITTEE Mr. STANLEY. Mr. Speaker I offer & privileged resolution (H. Res. 690) and ask for its immediate consideration. The Clerk read the resolution, as fol- lows: Resolved, That the expenses of the investi- gations to be conducted by the special com- mittee created by House Resolution 635, not to exceed $50,000, including expenditures for the employment of investigators, attorneys, and clerical, stonographic, and other assist- ants, shail be paid out of the contingent fund of the House on vouchers authorized by such committee, signed by the chairman of such committee, and approved by the Committee on House Administration. Committee amendment: Strike out “$50,- 000” and insert “$40,000.” The committee amendment was agreed to The resolution was agreed to. A motion to reconsider was laid on the table. ADDITIONAL PAY TO EMPLOYEES OF GOV- ERNMENT PRINTING OFFICE Mr. STANLEY. Mr. Speaker, I offer House concurrent resolution (H. Con. Res. 233) and ask for its immediate con- sideration. The Clerk read the resolution, as fol- lows: Resolved by the House of Representatives (the Senate concurring), That, effective Au- amendment was 10673 gust 1, 1950, there shall be paid, one-half out of the contingent fund of the Senate and one-half out of the contingent fund of the House of Representatives, until otherwise provided by law, to employees of the Govern- ment Printing Office engaged in the prepara- tion of the semimonthly and session indexes of the ConGrEssIONAL Recorn, additional com- pensation per annum, payable monthly, as follows: (1) To the chief indexer, the sum of $2,484. (2) To the cataloger whose present salary is @5,111, the sum of $1,489, (3) To cach of the two catalogers whose present salary is $4,068, the tum of $1,560. (4) To the cataloger whose present salary 4s $3,515, the sum of 81,5C0, The resolution was agrced to. A motion to reconsider was la'd on the table. PRINTING ADDITIONAL COPIES OF HEAR- INGS ON S. 1832 Mr. STANLEY. Mr. Speaker, I offer Senate concurrent resolution (8. Con, Recs. 96) and ask for its immediate con- sidcraticn. The Clerk rcad the resolution, as fol- lows: Resolved by the Senate (the House of Rep- resenftatives concurring), That there be rrinted five thousand additional copies of the hearings conducted before a subcommit- tee of the Senate Committee on the Judi- clary on S. 1832, Eighty-first Congress, first session, to amend the Immigration Act of October 16, “918, as amended. Such addl- tional copies shall be for the use of the Sen- ate Committee on the Judiciary, The resolution was agreed to. A motion to reconsider was laid on the table. OIL PORTRAIT AND MARBLE BUST OF THE LATE JUSTICE HARLAN F. STONE Mr. STANLEY. Mr. Speaker, by di- rection of the Committee on House Ad- ministration I call up the joint resolu- tion (H. J. Res. 501) to authorize the procurement of an oil portait and marble bust of the late Justice Harlan F. Stone. The Clerk read the joint resolution, as follows: Resolved, etc., That (a) the marshal of the Supreme Court of the United States, subject to the direction and approval of the Chief Justice of the United States, is authorized and directed to procure an oil portrait and a marble bust, including pedestal, of the late Chief Justice Harlan F. Stone, and to cause them to be placed in the United States Su- preme Court Building. (b) There is hereby authorized to be ap- propriated the sum of not to exceed $6,000 to carry out the purposes of this joint reso- lution. The joint resolution was agreed to. A motion to reconsider was laid on the table. SPECIAL ORDER GRANTED Mr. MCKINNON (at the request of Mr. Hays of Arkansas) was given permission to address the House for 30 minutes on Monday next, following the legislative business of the day and any special or- ders heretofore entered. TWENTIETH-CENTURY MINUTEMEN Mr. DAVENPORT. Mr. Speaker, I ask unanimous consent to extend my ree marks at this point in the Rrcorp.
10674 The SPEAKER. Is there objection to the request of the gentleman from Penn- sylvania? There was no objection. Mr. DAVENPORT. Mr. Speaker, cur- rent headlincs tell of the armor we are dispatching to our hard-pressed forces in South Korea and of our generals who are directing our fighting forces there. But little is said of the heroic and val- fant deeds, far beyond the call of duty, that our mud-slogging GI's, the boys from your home town and mine, are daily accomplishing there. These are our twentieth-century minutemen upon whom the fate of western civilization may ultimately depend. In their strug- gle against odds that surpass anything experienced by our forces during World War II, we must convey to them all the tribute and honor that this proud Na- tion can muster. Whatever we did for our brave soldicrs in the war against Hitler, Mussolini, and Tojo, we must do for these boys. I hope that their moth- ers, wherever they are today throughout our great Nation, fee] Amcrica’s pride in their children. Let us back up these brave boys by staying at our jobs with- out respite until the tide of battle has safely turned. I call upon this Congress to go on record that it will not adjourn as long as these boys face peril. I call upon this Congress to stay in session to its Jast minute, if necessary, to insure complete and rapid victory. EXTENSION OF REMARKS Mr. ALBERT asked and was given permission to extend his remarks and include an address by R. W. Frazier, of Southeastern State College, Durant, Okla. Mr, VAN ZANDT (at the request of Mr. Martin of Massachusetts) was given permission to extend his remarks and include a newspaper article. Mr. MULTER asked and was given permission to extend his remarks in two separate instances and in each to in- clude extraneous matter, Mr. MULTER asked and was given permission to extend in the Appendix of the Record a proposal made by Walter P, Reuther, president of UAW-CIO en- titled “A Total Peace Offensive” not- withstanding the fact that it will take 5% pages of the Recorp and is estimated by the Public Printer to cost $464.68. Mr. BIEMILLER asked and was given permission to extend his remarks in two separate instances. Mr. BUCHANAN asked and was given permission to revise and extend the re- marks he made in the Committee of the Whole today and include therein excerpts from House Report No. 846. Mr. HAVENNER asked and was given permission to extend his remarks and include an editorial. Mr. D'EWART asked and was given permission to extend his own remarks in the Recorp. Mr. HARVEY asked and was given permission to extend his own remarks in the Recorp. Mr. SMITH of Wisconsin asked and was given permission to extend his re- marks and include an editorial. CONGRESSIONAL RECORD—HOUSE Mr. CANFIELD asked and was given permission to extend his remarks and include a newspaper article, SPECIAL ORDER The SPEAKER. Under the previous order of the House, the gentleman from Alabama {Mr. Hosss] is recognized for 10 minutes. Mr. HOBBS. Mr. Speaker, I ask unan- imous consent to extend in the Recorp at this point an editorial appearing in this morning’s Washington Post. The SPEAKER. Is there objection to the request of the gentleman from Ala- bama? There was no objection. (The editorial referred to follows: ) Not THE AMERICAN WAY Passage of the Hobbs bill by a vote of 326 to 15 in the House must be regarded as a popular demand for tightening up the law in regard to deportablie aliens. Since the bill was debated for only 40 minutes, it is reason- able to suppose that many Members who voted for it were not familiar with its detalis. They voted affirmatively, we suspect, because they believe that subversive and criminal aliens should not be allowed to roam the country without check or supervision so long as the countries from which they came re- fuse to take them back again. We sympa- thize with that point of view while deploring the drastic remedy that the Hobbs bill would apply. The bill hos been substantially improved by amendment. Its most drastic provisions are aimed only at alien criminals and sub- versives who have been found guilty of vio- lating the law and then ordered deported. Certainly aliens of this type should not be footloose merely because the country from which they came is unwilling to receive them. In some instances subversives from the !ron- curtain countries continue to do their ne- farious work here because regimes which sent them to the United States refuse to take them back again This makes a mockery of American law. We should not put ourselves at the mercy of communistic agents in this fashion. But we ought to deal with these people in accord with the pattern of Amerie can justice and not merely give the Attorney General power to throw them into concen- tration camps, which is the Communist method. The bill would not require imprisonment of the deportable allens in question. As an alternative, the Attorney General could re- quire them to report regularly to the Immi- gration and Naturalization Service, to sub- mit to medical and psychiatric examination, to give information under oath as to thetr habits and activities, and to conform to rea- sonable regulations to be Inid down by the Attorney General, until their deporta- tion could be arranged. Properly admin- istered, this section of the bill would afford a salutary check upon the activities of the undersirables in question. It would enable the Government to keep close watch on what they were doing. Under even the amended bill, however, the Attorney General could step in at any time and order that any alien so controlled and supervised be sent to prison. It 1s this provision that is utterly out of keeping with the American concept of due process. We have no doubt that some of the subversive deportable aliens now at large ought to be locked up. But let it be done by bringing proper charges and giving each a fair trial. Proponents of the bill made much of the fact that the individuals concerned have already been tried. But they have also paid the penalty for the offenses for which they have been convicted. JULY 19 What !s involved under this bill is a second punishment, without any second trial, merely because deportation cannot be cer- ried out. This {s certainly un-American and probably unconstitutional. No such sweep- ing discretion should be vested in the At- torney General. Any extensive exercise of this power would result tn the establishment of concentration camps. The experience of other countries has proved that once established, the con- centration-camp habit grows. How long would tt be before citizens regarded as dan- gerous to our national security would be thrown into concentration camps without trial? The only safe and reasonable course is to hold fast to the principle of imprison- ing people only for crimes for which they have been convicted through our established judicial process. The maintenance of liberty within the country is no less important than defense against enemies without. It is up to the Scnate to reshape the Hobbs bill into an effective control system over aliens await- ing deportation without turning over to the Attorney General the power to make the United States a concentration-camp country. DEPORTATION OF CERTAIN ALIENS Mr. HOBBS, Mr. Speaker, I want to comment on an editorial that appeared in the Washington Post this morning which at one point made almost as good a speech as some of those that were made in favor of H. R. 10 Monday when that bill was passed by a vote of 326 to 15. I read one of the passages that I think is excellent: Its most drastic provisions are aimed only at alien criminals and subversives who have been found guilty of violating the Jaw and then ordered deported. Certainly aliens of this type should not be footloose merely be- cause the country from which they came is unwilling to receive them. In some instances subversives from the iron-curtain countries continue to do their nefarious work here be- cause regimes which sent them to the United States refuse to take them back again. This makes a mockery of American law. We should not put ourselves at the mercy of communistic agents in this fashion. Now, that quote from the editorial mects with my hearty approval. But the gentleman who wrote the editorial was mistaken in his opening statement, which is as follows: Passage of the Hobbs bill by a vote of 326 to 15 in the House must be regarded as a popular demand for tightening up the law in regard to deportable aliens. Mr. Speaker, that is one of the funda- mental errors into which the distin- guished editor has fallen. This bill, H. R. 10, has nothing in the world to do with deportable aliens, but those that have been finally ordered by legitimate authorities of your Nation and mine to be deported after exhausting all of the remedies provided by law to protect their rights. It is only after the warrant of deportation, which is the final step after all of the courts have spoken, has been issued that this bill takes effect and when after this alien, who has been received into our country, not forced to come here but by our grace, and who has violated his sworn pledge of allegiance to our in- stitutions, our laws, and to the United States, into which he has been allowed to come as our guest, violates his oath of entry, tramples our Jaws underfoot and is a criminal alicn in our midst, who
1950 finally, after exhausting all of his rem- edies in the courts, has been ordered de- ported by the sovereign might of our Nation, as every free nation has, which has been thwarted in some way, usually by bribery of some petty officer of a for- eign nation. That is what the experts tell me. Of course, Russia does not want those who come here as propagandists of their fifth column to come back home if they are doing good work here. So, the big shots stay unmolested, because there never has keen a single passport for the re- turn of one of them ever granted by Rus- sia, although in one case 13 applications of your Government were turned down flat, cold, and then a few months later when the man himself applied he got it in 5 days. So, the manifest joker in it is just that, It is not the dcport- able aliens; it is those that have been ordered finally deported. I want to tell you the story very briefly of the Joe Strecker case. Joe Strecker was a tailor in Little Rock, Ark. Ke did well; he was thrifty, hardworking, made money, and he invested every cent of his money in Soviet bonds, because he said he believed in the principles of Soviet Russia; that he was a member of the Communist Party and that he knew that the bloody purge, the world purge, was coming to capitalist countries, and he wanted to be on the right side when our Government was overthrown. So, he put every cent of his savings in Soviet bonds Well, when the law which said then that all Communists, or those who had any traffic with that organization which aims at the overthrow of our Gov- ernment by force and violence—so the courts have held—were subject to ar- rest, Joe Strecker was arrested, was tried by the admunistrative tribunal of our Bureau of Immigration and Naturaliza- tion. Then, when they declared that he should be deported, he asked for a writ of habeas corpus, and habeas corpus has been pooh-poohed on this floor in debate as though it did not amount to anything but due process of law. But, on the habeas corpus hearing in the court at Little Rock, Ark., he was ordered de- ported. His application for a writ of habeas corpus was denied and he was or- dered turned over to the immigration authorities, but while the immigration authorities were taking him to New Or- leans to put him on the boat he hired a lawyer, went before Judge Borah, the former Senator’s brother, who was United States judge at New Orleans, swore out another writ of habeas corpus, had another trial, and Judge Borah, after a full hearing, turned him down. He took an appeal then to the Fifth Circuit Court of Appeals. The Fifth Circuit Court of Appeals gave him a full hearing and a trial on appeal, such as they always do, and they reversed Judge Borah and held that he ought to be freed because he had resigned from the Com- munist Party pending the deportation proceedings. So, that settled that habeas corpus case. Mr. BOYKIN. Mr, Speaker, if the gentleman will yield, what happened to this man? CONGRESSIONAL RECORD—HOUSE Mr. HOBBS. I am going on to tell you. I thank the gentleman for the question. Then, after the Fifth Circuit Court of Appeals had ordered him freed because he failed to pay his dues or had resigned, maybe, the Government took certiorari to the Supreme Court and the Supreme Court upheld that contention and that decision by the Fifth Circuit Court of Appeals. They said, “Why, it is manifest that when the law says that you can only deport those men prosecuted in this case because they were Communists, that means at the present time. If aman has resigned or failed to pay his duces, then he has ceased to be a Communist.” So they construed the law that way. I had the pleasure of getting the statute changed to say that any man who had ever been a member of the Com- munist Party, no matter for how short or how long a time, or how long in the post, or where, should be deportable. Then that was too late to catch Joe Strecker. The Supreme Court freed him, and he is just as free today as you are or anybody else, but he says he has not changed his convictions a particle and, so far as I know, he may still be in- vesting every cent of his savings, money earncd here, in Soviet bonds. Mr. LUCAS. Mr. Speaker, will the gentleman yield? Mr. HOBBS. I yield to the gentleman from Texas. Mr. LUCAS. I think the gentleman has pointed out a flaw in the present Taft-Hartley law in relation to the anti- Communust oath. The gentleman knows that it is written in the present tense. A labor Ieader who is a Communist may throw away his card and say, “I am not now a Communist,” and retain his place by taking an oath in the present tense. I think it is a good thing the gentleman has changed this law to this effect. I believe we should change the Taft -Hart- ley law to give greater protection to our workingmen. Mr. HOBBS. I thank the gentleman very much for that contribution. I hope any such error will obviate any question about such a decision as was rendered in the Joe Strecker case. The Joe Strecker case pointed out to me and to those of us who are thinking on this point why we could not deport Harry Bridges, because Harry Bridges quit the Communist Party in 1938 after he had been, according to the evidence, to several international and national meetings as Comrade Something-or- Other. He had several aliases. But he finally quit when they got too hot behind him. So he was not at the moment a Communist, and under the Strecker de- cision he would have continued to be free. So it is under our amendment of the 1940 statute that this has now been accomplished finally. The only step left is to get Australia to take him back, but if they say they will not take him back, as they have solemnly and publicly said, then the only other answer is H. R. 10, which is just the thing to cure the ill about which we are talking. Mr. CUNNINGHAM. Mr. Speaker, will the gentleman yield? 10675 Mr. HOBBS. Why, of course, I am very glad to yield to my friend the dis- tinguished gentleman from Iowa [Mr. CUNNINGHAM]. Mr, CUNNINGHAM. I want to both thank the gentleman and congratulate him for his contribution, not only now but for the wonderful work that he has done ever since he has been in the Con- gress for the protection of our beloved country. I was interested a few moments ago when the gentleman from Alabama spoke about these Communists who are working for the overthrow of our Gov- ernment by force and violence. Does not the gentleman believe, and I am sure he does, that those Commu- nists and fellow travelers and those who follow their line, who seek to destroy us, not by force and violence, but by decep- tion, dcccit, sabotage, and stirring up dissension and the fomenting of strikes are even a greater menace to Amcrica than those who advocate the overthrow of the Government by force and vio- lence? Mr. HOBES. Why, certainly, sir, and I would love to amend that law so to to provide, but I do not believe that is feasible at the mornent. Mr. CANFIELD. Mr Speaker, will the gentleman yield? Mr. HOBBS. Why, of course, I will. I will be delighted always to yield to the gentleman from New Jersey. Mr. CANFIELD. I, too, want to com- mend the gentleman from Alabama. I think it is a sad commentary that Harry Bridges has a beachhead on our western coast opposing everything that our boys are fighting for in Korea today and try- ing to negate all that we in the House of Representatives are trying to do to end this conflict and promote world peace, Mr. HOBBS. Thank you, sir; I appre- ciate your contribution, as always. Mr. BOYKIN. Mr. Speaker, will the gentleman yield? Mr. HOBBS. Please let me say just before I yield to my dear friend from Alabama that there is no question about the status of Harry Bridges now. If H.R. 10 becbmes a law, as I will point out in just a minute, it not only is abundantly buttressed by the Constitution, but it will fit him like a glove because this, giv- ing him every right in the world, is not dependent upon the consent of his own Government. He came here on a skilled or able seaman’s ticket. He knows bet- ter than you or better than I that he can go back the same way. As I said on Monday, if 10,000 aliens have come here in one of the three easy ways—able seaman's enlistment, jump- ing ship in our ports, and getting travel documents which means coming through the United States, for instance, from Canada and going to Mexico, and just stopping here; or if they get a visitor's visa good for 90 days and overstayed, why, if 10,000 of them know how to use that kind of thing now to come in here, is it not reasonable to suppose that 5,009 aliens who come under the bill H. R. 10, according to the testimony of Mr. Ugo Carusi before our committee when he was head of the Immigration and Naturaliza- tion Commission, is it not reasonable to
10676 suppose those 5,000 can somehow find their way out? Do you not know that Kharry Bridges will not say in the jug 10 minutes? Ido. But I am not interested in keeping him locked up. I want him to get out. If his own country says he is such a bad citizen that they will not have him back, then I do not know of a better atmos- phere to cool his fevered brow until he gets the inclination to ship again as an able seaman. That is the way he came in. He can go back that way, anywhere he wants to, and jump ship without any fear of being bothered. Mr. BOYKIN. Mr. Speaker, will the gentleman yield? Mr. HOBBS. I am so happy to yield to my good friend from Mobile. Mr. BOYKIN. I am sure you know most of us here consider you one of the greatest constitutional lawyers, not only in this House but in this country. That is not me talking, but I have talked to men on both sides of this House. I re- member when you were sclected to try one of the greatest cases ever tried in this House, and I want to ask you one of the most important questions that I know of. Do you not think we can outlaw the Communist Party in the United States? Let us get rid of all of them forever and ever, so that they never could come here if they ever had been a Communist or ever expected to be. Mr. HOBBS. I will be glad to answer the gentleman’s question. The SPEAKER pro tempore. The time of the gentleman from Alabama has expired. Mr. HOBBS. Mr. Speaker, I ask unanimous consent to proceed for an ad- ditional 10 minutes. The SPEAKER pro tempore. Is there objection? There was no objection. Mr. HOBBS. I dislike to delay you ladies and gentlemen at this hour of the day, but I will be glad to answer my friend’s question. I do not. So many of the members of the Communist Party are American citizens, Iam sorry to say. Therefore, you would not strike at the root of the tree. That is one thing. Then, in the second place, Mr. J. Edgar Hoover, the great Director of the FBI—— Mr. BOYKIN. I agree. He is one of the greatest men living. Mr. HOBBS. That is right. He has done more to clean up crime in this country than any other man. He has absolutely cleaned up one of the crimes that H. R. 10 is aimed at; namely, the Lindbergh Act, kidnaping. He has not had a glaring instance of kidnaping in some time. We had dozens of them every year until we passed that act. But Mr. Hoover says he would rather have them known tohim. For instance, there is a place in this town which js run for and used by the Young Communists of America. You cannot touch them. But it is good to know who frequents that club. He does not want them to go underground where he will be unable to reach them. The same thing applies all over the country. The majority of the membership of the Communist Party in the United States is American, and you cannot touch one of them. That is all CONGRESSIONAL RECORD—HOUSE right. We bow to that, and pray for their redemption and that they may see the light. But we have got some of them. We have got rid of Fritz Kuhn. We have got rid of a number of his crowd. We have done a pretty good job, in spite of having our hands tied behind us. So I do not believe that against the advice of our enforcement officials we ought to just do what the gentleman suggests. Mr. BOYKIN. What can we do, then? Mr. HOBBS. Pass H. R. 10. Mr. GWINN. Mr. Speaker, will the gentleman yield? Mr. HOBBS. I yield. Mr. GWINN. Iam very much inter- ested in the question asked by the gen- tleman from Alabama {Mr. Boykin], Mr. HOBBS. So am I. Mr. GWINN. Is not our problem in connection with this question a problem of defining what communism is, or what the Communist Party is? So when we attempt to cutlaw an abstract concept we are in difficulty. Could we not do this? Could we not describe that associ- ation or that grouping, such as the Com- munist Internationale, the Comintern, the Cominform, and their agencies and groupings, whatever they are, to be ene- mies of the United States, just as we can treat a nation or a group as enemies? Now we are at war; we recognize certain parties or groups or associations as ene- mics; then if our fellow travelers sup- port them and send their literature about and do positive acts in aid of the enemy we have the legal procedure by which we can handle them. Is there not a possibility of that sort? Mr. HOBBS. I do not know. I have put a lot of gray hairs in my head trying to do just that. You take the bill which I still have pending to curb subversives: I cannot get to first base with it because it also does what I think is exactly what we should do, it not only punishes the man who accepts employment in our Government, but also the man who ap- points him and also the Congressman who recommends him for appointment; and that is what is killing my bill. There are too many fellows who might get caught. I said: “You are the very man I am talking about. You have got to be sure you recommend no one who is not absolutely loyal to the United States to work in our Government.” If our Government has sunk to the low plane where we cannot have absolute loyalty in the service of the Govern- ment, then I say we had better close up the whole establishment except the ab- solutely necessary departments and just shut them out from employment en- tirely, because if we cannot run with honest-to-God Americans then we do not need to run those departments in which we have to employ anybody with & question mark after him. Mr. O'SULLIVAN. Mr. Speaker, will the gentleman yield? Mr. HOBBS. I yield. Mr. O’SULLIVAN. My thought is that communism is not a political ideol- ogy, but in its last analysis is a conspir- acy to commit treason, no matter what country it originates in. I. seems to me that FBI Director Hoover is a little too tender with them when he says he does JULY 19 not want to drive a political conspiracy to commit treason underground. We drive every other crime tunderground. The grand divisions of crime are treason, felony, misdemeanor. I cannot under- stand the philosophy of trying to keep a conspiracy to commit treason above the ground. I think it ought to be put under the ground, and perhaps 6 feet deep. Mr. HOBBS. The gentleman may be entirely right. I was simply answering the question as to why we were not try- ing to do just that at the moment. I certainly appreciate the gentleman's comment. Mr. CUNNINGHAM. Mr. will the gentleman yield? Mr. HOBBS. I yield. Mr. CUNNINGHAM. I wish to sup- port the position of the gentleman from Alsbama addressing us, from a legal standpoint. To be a Communist is cer- tainly not treasonable in Russia, nor in Yugoslavia, nor in China; it is treason- able in the United States and ought to be. However, if we believe in repre- sentative government, in democracy as we practice it here, then if a majority of the people who are citizens, as the rpenticman has so well said, would he foolish enough, unwise enough, un- American enough to vote a Communist into the cffice of President of the United States and to vote Communists into con- trol of Congress, there is nothing we can do abcut it. The answer and the remedy lies in education, in putting the light of day on what these Communists attempt to do. In spite of that, if a majority of the peo- ple should vote those persons into office, then to deny our people that right would be defeating the very purpose for which we have been in existence. And the same would apply to every other party, a@ Progressive Party, the Free Soilers, or any offshoot political party that has risen in the past. If the overwhelming majority should go that way, then repre- sentatative government is out. I pray God that never will happen, and I hope it will not in America; I am sure it will not. But if we want to stop people from following the evils of the Communists or a false philosophy of government, we must educate those people to what a fol- lowing of this false philosophy will ulti- mately do to their beloved country. Mr. HOBES. And we have got to show them that we have a better way. Mr. CUNNINGHAM. That is right. Mr. HOBBS. I thank the gentleman. The SPEAKER pro tempore. The time of the gentleman from Alabama has again expired. Mr. CUNNINGHAM. Mr. Speaker, I ask unanimous consent that the gentle- man may proceed for another 10 minutes. The SPEAKER pro tempore. Is there objection to the request of the gentle- man from Iowa? There was no objection. Mr. HOBBS. Mr. Speaker, let me call attention to the fallacy of this editorial. This is the crux of the objectionable fea- ture of the editorial: “What is involved under this bill is a second punishment,” may I pause at that comma to say that the Supreme Court in the Turner case gives t.ic lie to that. This is not punish- Speaker,
1950 ment. Deportation is not a criminal trial, it is not a criminal procedure. It is no punishment to send a man back home. As I said in my speech on Mon- day, Brer Rabbit when he was protesting 60 violently to Uncle Remus because he was sent back where he was born and raised was not really sincere. He was just as happy as he could be when he was thrown back into the briar patch, his native home. I think that would be true here. It should not be punishment if you are the right kind of a person. It should not be punishment to be sent back home. That is all this is. So I do not believe the editorial is sound in its statement that they would object to that, but whether they object or not, the Supreme Court stated in the Turner case it is not punishment. I cited that in my remarks Monday. It is in the Recorp. The Supreme Court said it is not punishment, it is not second jeopardy; it is nothing in the world but a civil remedy known to every civilized independent government to get rid of its poisonous trash. When he violates his pledge of entry we have a perfect right to oust him by the civil remedy of depor- tation. So it is not punishment. Reading after the comma: ‘‘without any second trial merely because deporta- tion cannot be carried out.” I want to dwell for a moment on those words “without any second trial.” Did Harry Bridges have any second trial? He has had six. Did Joe Strecker have & second trial? He did in the forum of his own choosing—mark you that—not in his home. That did not suit him hbe- cause the judge there decided against hira, so he took another forum and went there, and when he had the same luck with the trial judge, he took an appeal to the fifth circuit that decided with him, and the Supreme Court, by denying the writ of cortiorari, affirmed their decision. But, he had all the chance in the world. Now I want to give you just exactly what the program is, not as to those who are dcportable but those who have been ordered deported, against whom an order of deportation has been issued, made after an administrative trial, which is due process of law. The Supreme Court says they do not have to have a jury trial, they do not have to have a judicial trial, because a trial by the agency put in charge by our Congress to administer the deportation law, the Department of Justice, where it belongs, gives them due process of law and they cannot complain. And even that administrative trial is subject to full right of appeal, first to the Eoard of Immigration Appeals of the Department of Justice, then to the review by the Attorney Gencral himsclf, who is the head of the Denartment cof Justice, then by habeas corpus to his own home or wherever he wants to take it, his habeas corpus, to any district court, then appeal to the circuit court of ap- peals and then by certiorari to the Su- preme Court, Now then, that is what this editor says is a wholly absence of second trial. It is Just the reverse. We gave Joe Strecker six trials; we gave Harry Bridges six, and they were freed by the Supreme Court on what Mr. CriLter—bless his heart— Says is no remedy at all; but, they were CONGRESSIONAL RECORD—HOUSE freed on habeas corpus by appealing to the Supreme Court through certiorari, So, habeas corpus does result in thou- sands of releases. And, they are not through then, They are freed some- tumes on certiorari by the Government and sometimes by the man that has been ordered to be deported. Now, I am not going to keep you longer; I just want to tell you one or two other stories. It will not take but a minute. I want to tell you the story cf Caeserio Valenti, of Philadelphia, the City of Brotherly Love. He admitted that he was the head of the Philadelphia poison ring, but his lawyer said that I lied on May 5, 1939, to the House of Representatives in my speech when J said that he was responsible for the murders committed by the poison ring of which he was the head and who, by poi- son, for the sake of collecting insurance money, had poisoned or was charged with poisoning over 100 citizens of Philadel- phia; and he said that I lied; that his client, Caeserio Valenti, although he was the head of it, was not responsible for poisoning but 21 himself. Well, the reason we could not deport him was not because that was a good defense, but it was because he was imprisoned in the Eastern State Penitentiary of Pennsyl- vania for life for first-degree murder. He did not have but one life to give to his country and he did not want to give that. He wanted to kill anybody that had an insurance policy. But when I checked up to see if he had been paroled or any- thing of that sort, I was informed today that he had been denied parole because since he had been imprisoned he has gouged out the eye of another prisoner, Therefore, his bchavior has not been so excellent as to warrant consideration for parole, Mr. BOYKIN. Does the gentleman remember the name of his lawyer? Mr. HOBBS. No; I do not. Now I want to tell you about the De- troit case, about Bernard Nicdzialkowski, who is either a Russian or from a satel- lite country. The immigration authori- tics were ready to deport him, and he has been finally ordered deported. That was for a crime, The warrant was is- sued in 1930, and he never got out, never paid any attention, but he was convicted of murder and was arresied for murder. While this was pending, while they were taking him to jail, he went by and just did a little job that he had wanted to do for a long time. Now that he knew his time was short, he went by and killed a friend of his in Detroit. So he was ar- rested for murder, and they could not deport him. Then while they released him on bond, I believe, or suspended the order of deportation, he killed his second man, and possibly a third. The authori- ties are in dispute as to whether he got his third or just shot at him. At any rate, he is still imprisoned in the Mich- igan State Penitentiary, and he cannot get out even to be deported. So these men have been with us and we cannot get rid of them. But the authorities testified before our commit- tee that there were several thousand criminal aliens who had been finally ordered deported, and whose deportation 10677 was not stopped by prison bars, but be- cause they did not care to leave. At least, that is about what it amounts to. There is only one way I know to do it, and that is by H. R. 10, which we passed so overwhelmingly Monday. I just want to correct in the minds of any of you ladies or gentlemen who are present any impression that there has been any punishment inflicted, that there has been any criminal charge prosecuted. This bill specifically says that they shall be detained in aid of deportation, our sovereign power, though. not at hard labor. That is to meet the decision in the Michigan case. You keep them as parlor boarders. We mean to do just that until they come to the con- clusion that they have to obcy the orders of the duly constituted law of the land, which they swore to uphold and obey. The SPEAKER pro tempore (Mr. Morvock). Under previous order of the House, the gentleman from Massachu- setts [Mr. Furco.o] is recognized for 20 minutes. BETTER RELATIONS BETWEEN THE NATIONS OF THE WORLD Mr. FURCOLO. Mr. Speaker, may it please the House, shortly before the war in Korea began, I had sent a suggestion to the President and the Secretary of State that I felt might be considered as one possible road toward the ultimate goal of better relations between te nations of the world. I had intended to discuss the matter on the floor of Congress after the Presi- dent and the Secretary of State had had an opportunity to analyze my proposal. With that end in view, I had obtained permission to speak under a special order back some weeks ago. However, the war in Korea began 1 day before the time scheduled for my talk in Congress and 2 days before a radio program that had been scheduled for the purpose of dis- cussing my suggestion with the people of the Nation. I found that people who had been ecx- tremely interested in the idea abandoned all hope for it as soon as the war in Korea started. Newspapers that had given front page atiention to it when I first broached the idea changed right after the war in Korea started. Their attitude changed from one of apparent enthusiasm to one of “Well, no use talk- ing about peace now. The war has started.” I, too, fell into that same frame of mind, but I now believe I was mistaken to have ever paused even momentarily. I am firmly convinced that we must de- vote our every effort to every possible means of achieving lasting peace in the world—and we must do it every moment until we have succeeded, I have been encouraged to find that many of our national leaders apparently hold this same belief. A little later on I will quote from the testimony of those leaders—testimony that they gave in July that seems to be an endorsement of at least the principle of the plan I sug- gested to the President and the Secre- tary of State in June. But first, let me tell you of the suggestion I made in June. I had better emphasize right now that the suggestion I am about to discuss is
10678 for every nation in the world—not simply Russia, although I illustrate by Russia— but the idea is intended to apply to all nations. Now, this is the substance of the pro- posal I made in June: Recent history has shown that, re- gardless of the cause of the situation, the fact remains that diplomacy at high government levels does not secm to create confidence and understanding between nations. That is particularly true of the relations of the United States and Soviet Russia. While the idea I am suggesting is to be applied to all the nations of the world, let me illustrate its workings by using Russia as an example. Russia and the United States regard each other with skepticism and distrust. Everything that is done by either Gov- ernment merely increases the climate of hatred and fear in the people of each nation. High-ranking diplomats have been unable to pierce the iron curtain, and the true story of America never gets to the Russian people. Statements and statistics from our governmental agen- cies are derided by the Communists as nothing but capitalistic propaganda. We are pictured as an imperialistic na- tion seeking to destroy Russia and enslave her people. The average, every- day Russian is also led to believe that the United States is about to collapse because of the failure of the capitalistic system. Our people are maligned as corrupt, impoverished, unfriendly, intol- erant—just about everything that is bad. We in this country may scoff at the idea of anyone taking such statements about us seriously. We may find it diffi- cult or impossible to believe that any people think of us in such terms. Let us not be deceived. We must realize that the average Russian does not know us. He does not have the faintest con- ception of what the people of America are really like. He is not given the truth about our belief in freedom and justice, our standard of living, our ideals and aspirations, and our American way of life. In brief, he does not really know us. The average Russian merely knows what the Russian governmental] officials tell him. If he should doubt their word, he has no way of learning the truth even if he earnestly seeks to ascertain It. His schools, newspapers, radios, literature— every medium of information, in fact— is rigidly controlled by a Soviet Govern- ment that pictures us in whatever terms will suit the wishes of the Communists. The other side of the story—our side of the story—never really penetrates the iron curtain. In the first place, the Soviet Govern- ment telis its people only those things it feels they should know. It does not hesitate to use falsehoods and half- truths if it believes such strategy is nec- essary in the best interests of the cause of communism. In the second place, assuming they get by Soviet censorship, official statements of our Government are disbelieved by the Russian people. They have been taught that we are lying, warlike imperialists who are trying to deceive the world by false propaganda. Our official statements are taken either with the greatest skepticism and suspi- cion or with outright disbelief. Before CONGRESSIONAL ROCORD—HOUSE ‘we blame the Russian people for that, let us ask ourselves whether we would be- lieve a statement of the Soviet Govern- ment if our own American Government, rewspapers, and radios all emphasized tnat the Russian statement was false. Why do we expect the people of Russia to take any statement of our Govern- ment in preference to that of their own government, newspapers, and radio? That is why I believe that we must seek to achieve a people-to-people diplomacy because, whatever be the reason, our of- ficial diplomacy alone is not succeeding quickly enough to insure peace in the world. We must get to know the Russian peo- ple better and they must learn to know what the people of the United States are really like. How can that be achieved? I offer the following suggestion in the full realization that it may not be the complete answer. But it may help to implement our official foreign policy. I also realize that as far as Russia is con- cerned, my suggestion may be doomed to failure by the refusal of the Russian Government to join with us in any mu- tual undertaking of friendship and un- derstanding. Even so, I believe it will be at least a gesture of good will and attempted cooperation that may inspire the true confidence of the world, includ- ing the people of Russia. And, regard- less of Russia’s rejection of it, I believe most nations of the world would co- operate and participate in the move- ment. I propose that, as part of our foreign policy, we inaugurate an attempt to es- tablish better relations abroad by what I am terming a Truth Through Youth movement. I propose that under the United Nations, a world Truth Through Youth foundation be established with the aim of creating better understand- ing among the peoples of the world. I hope every nation will participate—but to illustrate how Truth Through Youth might operate, let me cite as examples Russia and the United States. Every month we would select a hun- dred high-school] youths from the States of this country to go on a tour of Russia. I use the figure 100 for illustration. At the same time, a comparable number of Russian youths would be brought to this Nation. In this country, they would be free to go anywhere and everywhere, talk to anyone and everyone, and see any- thing and everything in which they might be interested. It is hoped that Russia would grant the same privileges to our touring youngsters. Each group might visit the officialdom of the nation in which they were visiting, but that would not be the primary ob- jective of the tour. The main purpose would be to mix with the people them- selves of the nation, to visit shops and factories, schools and playgrounds, farms and stores, and places where the people play, study, work, and live. It is possible that each group might even make some friends in the country visited, friends who would exchange correspondence and ideas in succeeding years. During their visit, without their even consciously or intentionally telling of America, our youngsters would be con- veying to the people of Russia the first JULY 19 authentic picture of what our country really is and what our people are really like. Most important of all, they will be believed as no official statement of our Government is ever believed. They will get to the people as no official of our Government ever gets to the people. They will create friendship and under- standing as no official of our Government has ever been able to create friendship and understanding. High-school young- sters are not mature enough to be con- sidered as spies or propagandists or peo- ple of cunning and guile. We may hope that the Russian people will accept them at face value, as they will never acccpt mature diplomats and statesmen. The Russian people or the American people might disbelieve statements of the press, radios, or officials of the other nation, but these same people would find it more difficult to disbelieve their own eyes and ears. And, which is even more important, they would place absolute faith and confidence in the reports of their own children after they had returned from the country of their visit. If Truth Through Youth worked as it might well work, let us imagine over a thousand American children a year visiting all parts of Russia. I have enough faith in our youngsters to be willing to rely on them as the best am- bassadors of good will we can have. I think the Russian people will believe them and through them will see Ameri- cans as we really are. At the same time, a thousand Russian children are visiting all parts of the United States. On their return to Rus- sia they tell their parents, neighbors, and schoolmates of what they have seen in this country, what the Americans are really like, and what the American way of life really is. Will they be believed? We all know that the people of Russia will take the word of their own young- sters in preference to anything our Gov- ernment or the Russian Government might say. It is double-barreled in that both the Russian and the American youngsters will be ambassadors of good will in both countries—over 2,000 ambassadors a year who do not talk in diplomatic lan- guage on high governmental levels but who reach the people themselves. It will not be dollar diplomacy, military diplomacy, power deplomacy, or any other kind of diplomacy that is subject to misunderstanding or misinterpreta- tion. It will be the only type of people- to-people diplomacy that may create friendship and understanding in the people themselves. I believe the attain- ment of that objective may be begun by the Truth Through Youth movement. It may take a long time, perhaps too long. I see no shorter way. If we in this generation have failed to achieve mutual trust, understanding, and good will, perhaps the next generation may succeed where we have failed. They cannot succeed if we have not given them the opportunity. Let the youth of each nation understand each other at the high-school level so that, when they take over the reins of leadership some years from now, their youthful experiences and knowledge may help to secure pcace in the world.
1950 The cost of financing any Truth Through Youth movement would not be prohibitive. The cost of war today ts prohibitive. The cost of peace cannot be measured in terms of money. The real question is, Can we afford not to do it? Actually the cost would be approxi- mately $1,000,000 a year for 1,000 Ameri- can high-school youngsters. We are al- ready spending over $3,000,000,000 a year to buy friendship abroad. In terms of economy, the Truth Through Youth movement will actually save us money in the long run because it is not intended to be merely a tem- porary, stop-gap solution. It is based on the hope of permanent gains of friend- ship, understanding, and good will. It is also not a waste of money even if it accomplishes nothing but a more broadened education for some of the youth of this country. Those who par- ticipate in the movement will have re- ceived knowledge and education that will repay them, and ultimately this country, many dividends. . I propose the venture even if it be financed solely and completely by the Government of the United States. How- ever, I do not believe that will be neces- sary because I think other nations, per- haps even Russia, will participate gladly and willingly bear their own share of the expense. I also think that if the people of the United States believe in the idea of a Truth Through Youth move- ment, we have enough patriotic citizens who will voluntarily contribute to finance it without burdening the Government. I readily admit the idea may have many flaws in it. I do not pretend to know whether it is the best possible solu- tion or not. I hope the people of this Nation will think about it and give me the benefit of their advice. I want to emphasize that I do not seck the abandonment of our diplomatic en- deavors but merely the implementation of them by a people-to-people undcr- standing. I believe the movement will also be added proof to the world of our carnest endeavors to achieve peace and good will—to open the door to friendship and understanding through the medium of a generation that must achieve those ends or perish. Of one thing I am certain: If such a movement had been in effect for the past 20 years, our relations with Soviet Russia would be vastly better than they are today. Let us not have our children re- peat the same statement 20 years from now. Let me also emphasize that the move- ment is intended to apply to all nations, not just Russia. Too often we have waited for trouble some place, then take action to correct it. Let us start this movement right now, even in places where there is no trouble yet—but where there may be in the near future—let us sow the seeds of friendship before the trouble—positive diplomacy, where we take the initiative right now with the Generation that will rule those countries pretty soon. The fate of the world may be decided in the next few years. Let us be sure we have made every possible effort, no matter how small it may be, to bring CONGRESSIONAL RECORD—HOUSE good will, trust, and understanding to the peoples of the world. Only in that way will lasting peace for the world ever be attained. I suggest the Truth Through Youth movement I have pro- posed as at least one step in that direction. That was the substance of the sug- gestion I made. Not long after I ad- vanced that suggestion to the President and the Secretary of State, the war in Korea began and I postponed my dis- cussion of it with the Members of Con- gress. Since that time several national leaders have testified before the Thomas subcommittee of the Senate Foreign Re- lations Committee considering Senator Benton’s Senate Resolution 243 ‘of a Marshall plan of ideas. Let me quote excerpts from the testimony of several of the witnesses who testified about July 5—~-see CONGRESSIONAL REcorD July 6, page 9696, and so forth. I believe the testi- mony speaks for itself. John Foster Dulles: On the effectiveness of our propaganda against that of the Russians may hang the question of war or peace in the next few months. Senator BENnTON: The problem is how to shatter Russian propaganda with truth. If the people of the world believe we are right as well as strong, communism will become easy to contain. The fight is for tho minds and loyalties of all mankind. It is nothing less than that, It is to tell the world what we stand for, so it can choose for itself between our freedom and the world's freedom, or Red Russian enslavement. Senator Benton also emphasized the point in his resolution that— We must encourage a vast two-way flow of students from all the countries of this earth and from America to these free nations. Senator BENTon also gave many illus- trations to show that the true story of America is not getting to the people of the world—see CoNGRESSIONAL RECORD, pages 9696-9701. Secretary of State Acheson: We must make the truth known to the peoples of the worid. * * ® One of the strategic objectives of the Communist cam- paign * * * is to confuse the world about the nature of democratic aspirations and ideals. * * “* Another ts to spread deception about the free world’s strength and resources. * * * We must, there- fore, make unmistakable the truth about the United States and the other frec nations. Acheson quoted from President Tru- man’s statement that— Our task is to present the truth to the millions of people who are untnformed or misinformed or unconvinced. Our task is to reach them in their daily lives as they work and learn. We must be alert, ingenious, and diligent in reaching peoples of other coun- tries * * * we must make ourselves heard around the world in a great campaign of truth. The Secretary of State then said: The task of telling the truth as the Presi- dent has emphasized is not separate and dis- tinct from other elements of our foreign policy. It ig a necessary part of all we are doing to build a peaceful world. It is essen. tial to the success of our foreign policy that the military, political, and economic meas- ures we are taking be accompanied by an 10679 effective information program. * * © TI welcome particularly this emphasis on priv- ate participation. Governments can do only @ very small part of the task. It is the individual citizens, the private organiza. tions, the independent groups, who make the major contribution to insuring that the truth is known. The Secretary of State concluded by saying: There has never been a time when men everywhere who value freedom have a greater need to know the truth, The Members are all familiar, of course, with General Eisenhower's state- ment to the effect that truth is our great- est weapon in the world today. Senator Lexman and Senator Fran- pers also testified and their testimony can be read on pages 9700 and 9701 of the ConcressronaL Recorp for July 6. As I stated above, I believe the testi- mony of these witnesses speaks for it- self. The testimony indicates very clearly, in my opinion, the need to go ahead on any effective campaign of truth even while the war in Korea is on. I agree with that outlook. While thcse witnesses were not talk- ing about truth through youth, but were merely considering any and all ideas that might help to spread truth, I be- lieve there testimony gives support to the suggested _ truth-through-youth movement. I do not know what the Members think of the idea of truth through youth which I propose but I hope you will all give it thoughtful consideration. I had again betlcr emphasize the same thing that I pointed out on several occasions back before war in Korea started, namely, that I believe the program should be put into effect regardless of whether Russia will cooperate or not. There are many, many nations that will cooperate, and we should begin with those nations even if Russia will not cooperate, If time permits before adjournment, I may introduce a resolution in order to have an expression of opinion by the Members so that the President and Sec- retary of State may know that the Con- gress either approves or disapproves of the idea of a truth-through-youth move- ment. The SPEAKER pro tempore. Under previous order of the House, the gentle- woman from Massachusetts [Mrs. Rocers] is recognized for 3 minutes. BISHOP THOMAS F. MARKHAM Mrs. ROGERS of Massachusetts. Mr. Speaker, I should like to speak of the pride that Lowell, Mass., and the Com- monwealth of Massachusetts has in the fact that Bishop-elect Thomas F. Mark- ham, St. Peter’s Church, Gorham Street, Lowell, Mass., has been appointed an auxiliary bishop of Boston. He was born at Lowell, Mass., and edu- cated in the grammar and high school of Lowell. He attended Holy Cross College and North American College at Rome, Italy. He was appointed monsignor while in Rome and was in charge of the American Bishop's Relief while in Italy. He acted as rector of the American Col- lege in Rome. He helongs to a very flustrious family. IIe is the brother of
10680 James Markham, former Alien Property Custodian, and is a man of great distinction. LIFE INSURANCE FOR KOREAN VETERANS Mrs, ROGERS of Massachusetts. Mr. Speaker, I ask unanimous consent to ad- dress the House for 1 minute. The SPEAKER pro tempore. Is there objection to the request of the gentle- woman from Massachusetts? There was no objection. Mrs. ROGERS of Massachusetts. Mr. Speaker, I have been working in connec- tion with legislation to take care of the men who have been injured and who have died as a result of the Korean fight. Those boys of course should be protected by insurance and by the same kind of leg- islation covering the men of World War IJ. I ask the help of the Members of the House, I see the gentleman from New Jersey (Mr. CANFIELD] present, and I ask for his help especially in drafting legis- lation for the assistance of these vet- erans. SENATE ENROLLED BILLS SIGNED The SPEAKER announced his signa- ture to enrolled bills of the Senate of the following titles: § 382. An act for the relief of Wong Suey Wing: S 841 An act for the relief of Michele Bartolomeo Marchisio; § 976. An act for the relief of Vartan Chamsarian; 8 1262. An act for the relief of Jullana Mendiola Alastra, 8.1779. An act for the relief of Phil Meyers, also known as Gil Meyers, 8.2077. An act for the relief of Francisco Gonzalez Perez; 8. 2277. An act for the relief of George A. Voregarethsos (George Spiro Chatmos) ; 8 2296 An act for the relief of Maria Cicerelli, and 8 2676. An act for the relief of Kimie Yamada Ina and her daughter, Ritsuko Ina, BILLS PRESENTED TO THE PRESIDENT Mrs. NORTON, from the Committee on House Administration, reported that that committee did on July 18, 1950, pre- sent to the President, for his approval, bills of the House of the following titles: H R.940. An act to authorize construction of the Eklutna project, hydroelectric gen-~ erating plant and transmission facilities in connection therewith, and for other pure poses; and H.R. 6866. An act to adjust and define the boundary between Great Smoky Mountains National Park and the Cherokee-Pisgah- Nantahala National Forests, and for other purposes, ADJOURNMENT Mr. O’SULLIVAN. Mr. Speaker, I move that the House do now adjourn. The motion was agreed to; accordingly Cat 6 o’clock and 7 minutes p. m.) the House adjourned until tomorrow, Thurs- day, July 20, 1950, at 12 o’clock noon, EXECUTIVE COMMUNICATIONS, ETC. Under clause 2 of rule XXIV, executive communications were taken from the Speaker’s table and referred as follows: 1664 A letter from the Acting Attorney General, transmitting a report showing the special assistants employed during the pe- riod from January 1 to June 30, 1950, with compensation payable from the allotment CONGRESSIONAL RECORD—HOUSE contained in the appropriation for salaries and expenses, miscellaneous legal activities, pursuant to the provisions of the Depart- ment of Justice Appropriation Act for the fiscal year 1950, approved July 20, 1949; to the Committee on Expenditures in the Executive Departments. 1565. A letter from the Secretary of the Interior, transmitting a volume containing the acts of the second special session, second regular session, and fourth special session of the Seventeenth Legislature of Puerto Rico, and reorganization plans, pursuant to provisions of section 23 of the Organic Act of Puerto Rico; to the Committee on Public Lands. 1566. A letter from the Secretary of the Army, transmitting a letter from the Chief of Engineers, United States Army, dated June 2, 1950, submitting a report, together with accompanying papers, on a preliminary examination of Schuylkill River and tribu- taries, Pennsylvania, authorized by the Flood Control Act approved on July 24, 1946, to the Committee on Public Works. 1567 A letter from the Secretary of the Army, transmitting a letter from the Chief of Engineers, United States Army, dated June 2, 1950, submitting a report, together with accompanying papers, on a preliminary examination of bays, inlets, and rivers along the coast of Oregon with a view to providing an adequate number of deep-draft harbors, authorized by the River and Harbor Act approved on March 2, 1945; to the Commit- tee on Public Works. 1568, A communication from the President of the United States, transmitting an esti- mate of appropriation to pay claims for dam- ages, audited claims, and judgments ren- dered against the United States, as provided by various laws, in the amount of $34,339,- 114.37, together with such amounts as may be necessary to pay indefinite interest and costs and to cover increases in rates of ex- change as may be necessary to pay claims in foreign currency (H. Doc. No. 647); to the Committee on Appropriations and ordered to be printed. REPORTS OF COMMITTEES ON PUBLIO BILLS AND RESOLUTIONS Under clause 2 of rule XIII, reports of committees were delivered to the Clerk for printing and reference to the proper calendar, as follows: Mr LYNCH: Committee on Ways and Means. H. R. 7840. A bill to provide for the refund of certain estate taxes; without amendment (Rept. No 2696). Referred to the Committee of the Whole House on the State of the Union Mr COLMER. Committee on Rules. House Resolution 714. Resolution for considera- tion of H. R. 8569, a bill to strengthen the common defense by extending for & years the authority for the Texas City tin-smelter operation; without amendment (Rept No. 2597). Reforred to the House Calendar. Mr SABATH: Committee on Rules. House Resolution 715 Resolution for considera- tion of H R. 5967, a bill to amend the Inter- state Commerce Act, as amended, to clarify the status of freight forwarders and their relationship with motor common carriers; without amendment (Rept. No. 2598). Re- ferred to the House Calendar Mr. McSWEENEY: Committee on Rules, House Resolution 716. Resolution for con- sideration of H. R. 6277, a bill to give dis- charges to the members of the Russian Rall- way Service Corps organized by the War Department under authority of the President of the United States for service during the war with Germany; without amendment (Rept. No, 2599), Referred to the House Calendar. Mr. PETERSON: Committee Public Lands. H. R. 6640, @ bill to amend an act JULY 19 entitled “An act relating to the disposition of public lands of the United States situated in the State of Oklahoma between the Cim- arron base line and the north boundary of the Btate of Texas,” approved August 7, 1946, and for other purposes; with amend- ment (Rept No. 2600). Referred to the Committee of the Whole House on the State of the Union. Mr. EBERHARTER: Committee on Ways and Means. H. R. 0120, a bill to amend sec- tion 322 (b) (3) of the Internal Revenue Code; without amendment (Rept. No. 2601). Referred to the Committee of the Whole House on the State of the Union. Mr. STANLEY: Committee on House Ad- ministration House Resolution 495. Reso- lution providing for expenses of conducting an investigation by the Committee on the District of Columbia pursuant to House Reso- lution 340, Elghty-first Congress; with amendment (Rept. No. 2602). Ordered to be printed. Mr. STANLEY: Committee on House Ad- ministration. House Resolution 652. Reso- lution to provide funds for the expenses of the investigation authorized by House Reso- lution 643; with amendment (Rept. No 2603). Ordered tobe printed. Mr. STANLEY: Committee on House Ad- ministration. House Concurrent Resolution 233. Concurrent resolution increasing the compensation of employees of the Govern- ment Printing Office engaged in the prepara- tion of the indexes of the CoNGRESSIONAL REC- orp; without amendment (Rept. No. 2604). Ordered to be printed. Mr STANLEY: Committee on House Ad- ministration. Senate Concurrent Resolution 96. Concurrent resolution to print addi- tional copies cf hearings on 8. 1832, an im- migration bill, without amendment (Rept. No. 2605). Ordered to be printed Mr, STANLEY: Committee on House Ad- ministration House Joint Resolution 601. Joint resolution to authorize the procure- ment of an ofl portrait and a marble bust of the late Chief Justice Harlan F Stone; with. out amendment (Rept. No. 2606). Ordered to be printed. Mr. STANLEY: Committee on House Ad- ministration House Resolution 680. Reso- lution authorizing funds to defray expenses incurred by the special committee created by House Resolution 635; with amendment (Rept, No. 2607). Ordered to be printed. PUBLIC BILLS AND RESOLUTIONS Under clause 3 of rule XXII, public bills and resolutions were introduced and severally referred as follows: Py Mr. CELLER H.R.9171. A bill to provide for the tem- porary appointment of referees in bank- ruptcy, and for other purposes, to the Com- mittee on the Judictary, By Mr. JENKINS: H.R, 9172. A bill to amend the Civil Berv- ice Retirement Act of May 29, 1930, as amend- ed, to provide increased retirement benefits for immigrant inspectors, Immigration and Naturalization Service, Department of Jus- ticc; to the Committee on Post Office and Civil Service. By Mr. McCORMACK: H.R. 9173. A bill to establisn in the De- partment of Labor an Agency for the Handi- capped, to define its duties, and for other purposes; to the Committee on Education and Labor. By Mr. PLUMLEY: H.R.9174. A bill making an appropria- tion for the construction of a research lab- oratory for the Quartermaster Corps, United States Army, at a location to he selected by the Seoretary of Defense; to the Committee on Armed Services,
1950 By Mr. SANBORN: H R.9175. A bill to provide for the grant of certain lands to the American Falls school, Qistrict, No. 381, American Falls, Iduho; to the Committee on Public Lands. By Mr. SPENCE: H.R. 9176. A bill to establish a system of priorities and allocations for materials and facilities, authorize the requisitioning there- of, provide financial assistance for expansion of productive capacity and supply, strengthen controls over credit, regulate speculation on commodity exchanges, and by these measures facilitate the production of goods and serv- ices necessary for the national security, and for othor purposes; to the Committee on Banking and Currency. By Mr. VINSON; HR 9177. A bill to authorize the Presi- dent toe extend enlistments in the Armed Forces of the United Statos; to the Commit- tee on Armed Services. H R 9178. A bill to suspend the authorized personnel strength of the Armed Forces, and for other purposes, to the Committee on Armed Services. By Mr. BARING: H R 9179. A bill to authorize the Secre- tary of Agriculture to undertake programs for the control of the poisonous weed, Halo- geton glomeratus, and for other purposes; to the Committee on Agriculture. By Mr. WINSTEAD: H R.9180. A bill authorizing and directing the construction and repair of passenger, cargo, and tanker vessels necessary for the national defense; to the Committee on Mor~ chant Marine and Fisheries. By Mrs. ROGERS of Magsachusetts: H R 9181. A bill to provide for the crea- tion of the Office for Coordination of Civilian Defense, and for other purposes; to the Com- mittee on Armed Services. By Mr. POTTER: H.R 9182. A bill to amend the Career Compensition Act of 1949 so as to provide additional compensation for certain mem-~ bers of the uniformed services during periods of actual contact with hostile ground forces; tc the Committee on Armed Services. By Mr. SUTTON: HR 9183. A bill to grant income-tax exemptions with respect to compensation received for active service in the armed services; to the Committee on Ways and Means By Mr HESELTON: H R 9184. A bill to provide for the eepara- tion of subsidy from air-mail pay, and for other purposes; to the Committee on Inter- state and Foreign Commerce. By Mr. VURSELL: H J. Res. 506. Joint resolution to modify the authority of the White County Bridge Commission created by the act approved April 12, 1941; to authorize said commission and its successors to purchase or construct, and to maintain and operate, bridges across the Wabash River at various locations and to purchase, maintain, and operate ferries; and for other purposes; to the Committee on Publie Works. PRIVATE BILLS AND RESOLUTIONS Under clause 1 of rule XXII, private bills and resolutions were introduced and severally referred as follows: By Mr, BLACKNEY: H.™, 9185. A bill for the relief of Cecelia Wahis; to the Committee on the Judiciary, By Mr. CASE of South Dakota: H.R. 9186. A bill for the relief of Mr. and Mrs. Carl Wahl; to the Committee on the Judiciary. By Mr. COUDERT: H.R. 9187. A bill for the relief of Salvatore Gianna; to the Committee on the Judiciary. By Mr. DAVIS of Georgia: H.R. 9188. A bill for the relief of Edward M. Chapman, Roland P. Davis, and the Fi- CONGRESSIONAL RECORD—SENATE delity & Casualty Co. of New York; to the Comunittee on the Judiciary. By Mr. FARRINGTON: H.R.9189. A bill for the relief of Mrs. Ushi Yamauchi and Hatsue Yamauchi; to the Committee on the Judiciary. H.R,9190. A bill for the relief of Yaeko Phylis Matsumura; to the Committee on the Judiciary. H.R.9191. A bill for the relief of Hamako Horiuchi Toguchi and Kenneth Hiroshi To- guchi; to the Committee on the Judictary. H.R. 9192. A bill for the relief of Takako Ogura; to the Committee on the Judiciary. H R.9193. A bill for the relief of Fumiko Kamitanl; to the Committee on the Judi- clary,. H R.9194. A bill for the relief of Mitsue Takubo and Dudley Yataka Takubo; to the Committee on the Judiciary. IIl.R 9195. A bill for the relief of Nobuko Ietuji; to the Committee on the Judiciary, H R,9196. A bill for the rellef of Mrs, Miyoko Ohta Tsuchiya; to the Committee on the Judiciary. By Mr. GRANT: H R.9197. A bill for the relief of Sgt. James C. Hollon and Bessie L, Hollon; to the Committee on the Judictary. By Mr. JACKSON of Washington: H R 9198. A bill for the relief of Yoko Sato, to the Committee on the Judictary. By Mr. SCUDDER: H R.9199. A bill to authorize the appoint- ment of John S. Evans as a permanent ma- jor in the United States Air Force; to the Committee on Armed Services. By Mr. SMITH of Wisconsin: H R.9200. A bill for the relief of Wang Chi-Yuan; to the Committee on the Judi- clary. PETITIONS, ETC. Under clause 1 of rule XXII, petitions and papers were laid on the Clerk’s desk and referred as follows: 2269. By Mr. HAGEN: Resolution adopted by the City Council of East Grand Forks, Minn., on June 16, 1950, requesting that im- provements for flood control included in ap- pendix D, House Document No. 185, Elghty- first Congress, first session, with the excep- tion of the raising of the Demers Avenue Bridge, be given the earliest possibie pri- ority by all Government agencies; to the Committeo on Public Works. 2270. By Mr. SABATH: Petition of Messen- gers and Baggagemen's Lodge, No. 2064, Brotherhood of Railway Clerks, express di- vision, Chicago, Ill., urging the passage of H. R. 7789, a bill to amend the Railway Labor Act to make lawful negotiations of union-shop agreements; to the Committee on Interstate and Foreign Commerce, 2271. By the SPEAKER: Petition of Paul Kristy, commander, Benson Post, No. 112, the American Legion, Omaha, Nebr., stating that the Congress of the United States should not adjourn while United States Armed Forces are engaged in combat in Korea; to the Committee on Rules. SENATE Trourspay, Juty 20, 1950 Rev. F. Norman Van Brunt, associate minister, Foundry Methodist Church, Washington, D. C., offered the following prayer: Almighty God, the light of all that is true, the strength of all that {s good, the glory of all that is beautiful, we are in- wardly led to seek Thee daily. Thy guid- ance and the knowledge of Thy will gives 10681 us insight and assurance in the trying tasks of life. Graciously help us to abide in Thee, that evermore we may be stead- fast and strong. May our days be filled with a high sense of the sacredness of life and the value of time. Uplift us by the thought of the importance of our task in this day and let our hearts flow over with gratitude in the fact that we can serve in such a time as this. Above all, manifest Thyself to us in the daily round of life that Thy precepts may become our law. We pray in the dear Redeemer’s name, Amen. THE JOURNAL On request of Mr. Lucas, and by unan- imous consent, the reading of the Jour- nal of the proceedings of Wednesday, July 19, 1950, was dispensed with. MESSAGES FROM THE PRESIDENT— APPROVAL OF BILLS Messages in wriling from the President of the United States were communicated to the Senate by Mr. Miller, one of his secretaries, and he announced that on July 19, 1950, the President had approved and signed the following acts: 8 587. An act for the relief of Sister Ste- fania Cuprys; 8.848. An act for the relief of Lorenzo Buira Sarrate; S.1347. An act for the relief of Jose Da Silva; 8.1869. An act for the relief of Marcan- tonio Doria d’Angri and his wife, Sonia Stampa Doria d’Angri; 8.2462. An act for the relief of Ruzina Skalova; S 2662. An act for the relief of Evzen Sy- rovatka and his wife; S 2682. An act for the relief of Nuum Io- nescu and his wife; S. 2735. An act for the relief of Mrs. Vernon B Rasmussen; and 8 3007. An act for the relief of Stefanie Pfister and Hildegarde Weber. MESSAGE FROM THE HOUSE A message from the House of Repre- sentatives, by Mr. Chaffee, one of its clerks, announced that the House had agreed, without amendment, to the con- current resolution (S. Con. Res, 96) to print additional copies of hearings on S. 1832, an immigration bill. The message also announced that the House had passed the following bills and joint resolution, in which it requested the concurrence of the Senate: H.R. 7803. An act to amend section 120 of the Internal Revenue Code; H.R. 8975. An act to amend the Synthetic Liquid Fuels Act, as amended; and H. J Res 501. Joint resolution to author- ize the procurement of an of] portrait and a marble bust of the late Chief Justice Harlan F. Stone. The messr ge further announced that the House had agreed to a concurrent resolution (H. Con. Res. 233) increasing the compensation of employees of the Government Printing Office engaged in the preparation of indexes of the Con- GRESSIONAL ReEcorD, in which it requested the concurrence of the Senate. ENROLLED BILLS SIGNED The message also announced that the Speaker had affixed his signature to the
10682 following enrolled bills, and they were signed by the Vice President: 8.3809. An act to amend the Mutual De- fense Assistance Act of 1949; and H.R. 7477. An act providing for the con- veyance to the town of Nahant, Mass., of the Fort Ruckman Military Reservation. LEAVES OF ABSENCE On his own request, and by unani- mous consent, Mr. Tuomas of Utah was excused from attendance on the sessions of the Senate from July 26 to August 3, 1950. On his own request, and by unani- mous consent, Mr. HICKENLOOPER WA@S ex- cused from attendance on the session of the Senate tomorrow. CALL OF THE ROLL Mr. LUCAS. I suggest the absence of @ quorum. The VICE PRESIDENT. The Secre- tary will call the roll. The roll was called, and the following Senators answered to their names: Alken Hickerlooper Millikin Anderson Hil Morse Benton Hoey Mundt Brewster Holland Murray Bricker Humphrey Myers Bridges Hunt Neely Butler Ives O’Mahoney Capehart Jenner Pepper Chapman Johnron, Colo. Robertson Chavez Johnson, Tex. Russell Connally Johnston, 8.C, Saltonstall Cordon Kem Schoeppel Darby Kilgore Smith, Maine Donnell Langer Smith, N J. Douglas Leahy Sparkman Ecton Lehman Stennis Ellender Lodge Taft Ferguson Lucas Thomas, Ok'a. Flanders McCarran Thomas, Utah Frear McCarthy Thye Pulbright McClellan Tydings George McFarland Watkins Gillette McKellar Wherry Graham McMahon Wiley Green Mognuson Wiliams Gurney Malone Young Hayden Martin Hendrickson Maybank Mr. MYERS. I announce that the Senator from Virginia [Mr. Bran], the Senator from Mississippi [Mr. East.anp], and the Senator from Maryland [Mr. O'Conor] are absent on public business. The Senator from California [Mr. Downey] is absent because of illness. The Senator from Tennessee [Mr. KEFAUVER] is absent on official committee business. The Senator from Oklahoma [Mr. Kerr] is absent on official business at one of the Government departments. The Senator from Louisiana {Mr. Lone], the Senator from Idaho (Mr. Tay- tor}, and the Senator from Kentucky iMr. WrtHERS] are absent by leave of the Senate. Mr. SALTONSTALL. I announce that the Scnator from Washington I[Mr. Cain] and the Senator from Michigan (Mr. VANDENBERG! are absent by leave of the Senate. The Senator from Idaho [Mr. Dwor- SHAK] is absent on official business. The Senator from California [Mr. KNOWLAND] is necessarily absent. The Senator from New Hampshire {Mr. Tosey] is absent on official business attending a meeting of the Special Com- mittee to Investigate Organized Crime in Interstate Commerce, CONGRESSIONAL RECORD—SENATE The VICE PRESIDENT. A quorum ts present. EXECUTIVE COMMUNICATIONS, ETC. The VICE PRESIDENT laid before the Senate the following letters, which were referred, as indicated: PERFORMANCE AND PAYMENTS BONDS IN CON- NECTION WITH CrRTAIN Coast GUARD CON- TRACTS A letter from the Acting Secretary of the Treasury, transmitting a draft of proposed legislation to amend the act of April 20, 1941, to authorize the waiving of the requirement of performance and payment bonds in con- nection with certain Coast Guard contracts (with an accompanying paper); to the Com- mittee on Interstate and Foreign Commerce, GRANTING OF STATUS OF PERMANENT RESIDENCE TO CERTAIN ALIENS A letter from the Attorney General, trans- mitting, pursuant to law, copies of the orders of the Commissioner of the Immigration and Naturalization Service granting the applica- tion for permanent residence filed by certain aliens, together with a statement of the facts and pertinent provisions of law and the rea- sons for granting the applications (with accompanying papers); to the Committee on the Judiciary. REPORT ON APPRAISAL OF EDUCATIONAL EXCHANGE PROGRAM A letter from the chairman of the United Stetes Advisory Commission on Educational Exchange, transmitting, pursuant to law, a report concerning its appraisals of the edu- cation exchange program, together with its recommendations to the Secretary of State (with an accompanying report); to the Com- mittee on Foreign Relations. RerortT ON CONTRACTS NEGOTIATED BEY NA- TIONAL ADVISORY COMMITTEE FOR AERO- NAUTICS A letter from the executive secretary, National Advisory Committee for Aeronautics, Washington, D. C., transmitting, pursuant to law, @ report on contracts negotiated by the National Advisory Committee for Aeronautics, for the period January 1 to June 30, 1950 (with an accompanying report); to the Com- mittee on Armed Services. AMENDMENT OF PUBLIC HEALTH SERVICE ACT The VICE PRESIDENT laid before the Senate the amendments of the House of Representatives to the bill (S. 2160) to amend the Public Health Service Act to authorize annual and sick leave with pay for commissioned officers of the Public Health Service, to authorize the pay- ment of accumulated and accrued an- nual leave in excess of 60 days, and for other purposes, which were, on page 1, line 3, strike ‘‘c’ and insert “b’; on page 3, line 1, strike out all after “sum” down to and including ‘‘shall” in line 4 and insert “payment on the basis of his basic pay, his allowance for subsistence, and the allowance for rental of quar- ters whether or not he is receiving such allowance on such date: Provided, That the number of days upon which such lump-sum payment may be computed shall not exceed 60 days: Provided fur- ther, That no lump-sum payment shall”; and on page 3, strike out all after line 17 over to and including line 8 on page 4, and insert: Suc. 8. (a) Sections 1 and 2 of this act shall be effective on July 1, 19650. (b) Any officer who, on June 380, 1949, was credited with more than 60 days of acoumu- JULY 20 lated and accrued leave, shall be compen. sated for so much of such leave as exceeds 60 days but does not exceed 120 days, in a lump-sum payment on the basis of the base and longevity pay, the allowance for subsist. ence, and the allowance for rental of quarters (whether or not he was receiving such allow- ance on such date), which were applicable to him on such date under provisions of law then in effect: Provided, That there shall be deducted from the number of days upon which such lump-sum payment {ts otherwise authorized to be computed the number of days of Jeave in excess of 80 days taken dur- ing the period from July 1, 1949, to June 80, 1959. Payments authorized pursuant to this subsection shall be due and payable on July 1, 1960. (c) The provisions of this act shall not be applicable to an officer who has, prior to July 1, 1950, been placed on terminal! leave preceding separation, retirement, or release from active duty. Mr. THOMAS of Utah. 1 move that the Senate disagree to the amendments of the House, ask a conference with the House on the disagreeing votes of the two Houses thereon, and that the Chair appoint the conferees on the part of the Senate. The motion was agreed to, and the Vice President appointed Mr. Murray, Mr. Pepper, Mr. NeeLty, Mr. Tart, and Mr. SmirH of New Jersey conferees on the part of the Senate. PETITIONS AND MEMORIALS Petitions, etc., were laid before the Senate, and referred as indicated: By the VICE PRESIDENT: A resolution adopted by the Constitutional Convention of Hawail of 1960, relating to statehood for Hawail; ordered to lie on the table. (See resolution printed in full when pre- sented by Mr. O’ManwoOnery on July 19, 1950, Pp 10577, CONGRESSIONAL RECORD.) A resolution adopted by Benson Post 112, the American Legion, Omaha, Nebr., re- questing that Congress remain in session while the United States Armed Forces aie en- gaged in combat in Korea (with an accome- panying paper); to the Committee on Ap- propriations. A letter in the nature of a petition from the Illinois Duster & Brush Co., of Chicago, lll, signed by J. F. Hohenadel, president, re- lating to the use of atomic and hydrogen bombs; to the Committee on Armed Services. THE DAIRY INDUSTRY—RESOLUTION OF PURE MILK PRODUCTS COOPERATIVE OF WISCONSIN Mr. McCARTHY. Mr. President, the Pure Milk Products Cooperative, an asso- ciation of over 20,000 Wisconsin dairy farmers, through its board of directors adopted a resolution on May 4, 1950, at Fond du Lac, Wis, relating to the dairy industry, which I ask unanimous consent to be printed in the Recor», and appropriately referred. There being no objection, the resolu- tion was referred to the Committee on the Judiciary, and ordered to be printed in the Recorp, as follows: DECLARATION OF PoLiIcy TOWARD Bia BUSINES Pure Milk Products Cooperative, an asso- elation of over 20,000 Wisconsin dairy farmers, makes the following resolution con- cerning the pending antitrust suit against & large buyor of Wisconsin milk: The members of Pure Milk Products Coe operative, to a large devres, ecll their milk to evaporatecd-rilik plants, where it is manu-
1950 factured and then sold outside of the State of Wisconsin. Recognizing the complex economic prob- lems in marketing milk in Wisconsin, we fee] the following facts must be considered: 1, Wisconsin has ideal conditions for pro- ducing milk, making it the largest milk pro- ducer in the world, 2. Although Wisconsin land and climate are ideal for dairying, other possible alterna- tive products are not readily open to the Wisconsin farmer. 8 Because of these conditions, Wisconsin produces much more milk than js consumed in Wisconsin, with the surplus milk manu- factured into various dairy products. 4. This surplus milk has led to diversified manufacturing of dairy products in Wis- consin, such as cheese, evaporated milk, butter, and other dairy products. These manufactured dairy products must be sold throughout the United States, and the channels of distribution include notional firms having outlets all over the Uniied States. Particularly is this true with evapo- rated milk produced in enormous quantities in Wisconsin, The two principal means of nattonal distribution of evaporated milk are through nationally advertised brand numes or through the national retall chain stores. We in Pure Milk Products Cooperative sell large amounts of milk to many national firms uad eeck to sell more milk in the na- tional market in the ordinary free and non- monopolistic channels of trade, An antitrust sult agninst the A. & P. and its subsidiary, the White House Milk Co., if successful, will remove the White House Milk Co as a customer of Pure Milk Products Cooperative in the evaporated-mllk ficld. The White House Milk Co. is nowhere near the factor in national sales of evapo- rated milk as are other and larger customers of Pure Milk Products Cooperative. If the Antitrust Department is successful in elimi- nating A & P. and its subsidiary, the White House Muk Co., from the evaporated-milk ficld (White House Milk Co. has all its plants in the Wisconsin area), will other national firms be also eliminated from the evaporated- milk fleld? If so, this would radically affect agriculture 1n Wisconsin, because evaporated mllk is the great user of surplus milk in Wisconsin. The elimination of the evapo- rated-milk industry in Wisconsin would re- strict the opportunity of production on Wis- consin farms without available alternatives for the land. Pure Milk Products Cooperative members, as dairy farmers, own and operate their farms To strike down the markets for these members and for other Wisconsin dairy farmers will tend to cripple one of tho vestiges of private ownership and operation in America: Now, therefore, be it Resolved, That we recommend to our Rep- resentatives and Senators in Congress that a complete investigation be made of the present antitrust sult as to its effect on the dairy industry; we further recommend that Congress itself make a completely new study of the antitrust laws, with a view toward determining what the place of natlonal firms should be in the marketing of dairy products. COMMUNISM-—-RESOLUTION OF KIWANIS CLUB OF WATERTOWN, WIS. Mr, WILEY. Mr. President, I received in the mail today from the Kiwanis Club of Watertown, Wis., a comprehensive resolution on the reactions of the people in my State to the Communist menace at home and abroad. I think that this resolution reflects the grass-roots senti- ments of many of the people of my State. They recognize the fact that at this very moment I am speaking brave American boys are dying in the muddy foxholes of CONGRESSIONAL RECORD—SENATE Korea. Our men are giving their lives that freedom might endure, and it is ab- surd that we should fail to protect free- dom here on the home front. That is why I have long urged that the so-called Mundt - Ferguson - Johnston anti-Com- munist bill which has becn pending be- fore us for so long, and which we on the Senate Judiciary Committee reported, be taken up in the full Senate. Under this legislation at long last we would be able to identify Reds and Red- front groups. I ask unanimous consent that the text of the Kiwanis resolution be printed in the Rrconp and appropri- ately referred. There being no objection, the reso- lution was ordered to lie on the table and to be printed in the Recorp, as follows: Whereas the Kiwanis Club of Watertown, Wis, fearing only God and His justice, alarmed by the Korean-Communist situa- tion, concerned alout the internal security of the United States, and disgusted with the indifference of our governments toward the danger of Communist infiltration in Federal, State, and municipal governments, as woll as in private institutions that influence public opinion, such as radio stations and networks, newspapers and magazines, press wire serv- ices, end motion-picture intercsts, and being convinced that the expenditure of American lives in Korea is the result of these condi- tions; Now, therefore, we resolve and demand that wl departments of goverument—State, Federal, and municipal—awaken to the reall- zation of conditions of our time; that these governments adopt a joint policy declaring that no individual has a constitutional right to be employed by our governments; that the burden be put upon the individual employee to prove his loyalty in seeking or retaining Government employment; that all Govern- ment employees who are or have been mem- bers of the Communist Party, or who are or have been members of any Communist-front organizations, or who have continuously as- sociated with such party organizations and their members, be removed from Govern- ment employ, and that no such individuals be 50 employed in the future. That where doubt of loyalty of an employee or applicant cannot be removed, his employment be ter- minated or denied; that the dupes of the Communist Party be treated in the same category as the members because it makes little difference whether we are injured pur- posely or unwittingly; be it further Resolved, That the citizens of the United States be uiged to forgive those adminis- trators who have allowed their departments to become infiltrated in innocent ignorance, provided that they cooperate to the utmost to rid the Government of this vermin and refrain from cover-ups and whitewashings when investigations are made; be it further Resolved, That our heroic defenders in Korea and elsewhere be given unlimited sup- port and cooperation; that the daily reports on movements of troops, naval units, and supply be discontinued, that the best of our military weapons and equipment be put at the disposal of our fighting men; that the severest punishment be meted out to those who knowingly or negligently cause one drop of American blood to be needlessly shed; be it further Resolved, That all such radio stations and networks, newspapers and magazines, press wire services and motion picture interests or other news gathering agencies make thorough sciutiny of any and all news copy which may contain even the slightest hint of Communist propaganda, and which tends to vilify editorially those loyal Americans in our governments who stand courageously lor 10683 good, clean, Communist-free American con- stitutional government, yet which makes martyrs of known Communists, dupes, and fellow travelers. That these radio stations and networks, newspapers and magazines, press wire services and motion picture inter- ests or other news gathering agencies here- in described, when upon discovering such Communist slanted copy passing through their facilities, make every effort to block the transmission of same, and that the person or persons responsible for the authorship of such Communist slanted copy be dismirsed immediately from the employ of such agencies. That any and all writers or corre- spondents upon applying for employment with the above-described agencies, shall have imposed upon them the burden of proof of loyalty to the United States, and if unwilling or unable to demonctrate this proof of loyal- ty, be forever denied employment with these agencies even on a part-time or free-lance basis. That any and all writers presently so employed shall alto have imposed upon them the burden of proof of loyalty to the United States, and if unwilling or unable to demon- strate said proof, that they be dismissed !m- mediately from the employ of these agencies. Further, that there agencies instruct their employees to avoid any “accidental” reports of troop or supply movements when handling news during the prosecution of a war; be it further Resolved, That copies of this resolution be sent to the Honorable Harry 8. Truman, President of the United States, the Hon. Alexander Wiley, United States Senator from Wisconsin; Hon. Joseph McCarthy, United States Senator from Wisconsin, and each of the 10 Representatives in Congress from the Stute of Wisconsin, the Hon. Oscar Renne-~- bohm, Governor of the State of Wisconsin; city manager Dean Van Ness, of Watertown; the United Press, Associated Press, and Inter- national News Service; WTTN, Watertown, Wis., the Watertown Dally Times, Watertown, Wis., and major newspapers in the State of Wisconsin; and Kiwanis International The above resolution was adopted unant- mously by the Kiwanis Club of Watertown, Wis., on July 17, 1950. E. J. Kine, President. Bernarp J TRAGER, Vice President. Don MITCHELL, Vice President, Russe_t A. KEr, Secretary-Treasurer, STATEMENT BY SENATOR HUMPHREY ON THE PRESIDENT’S MESSAGE, AND NEWS- PAPER COMMENT Mr. HUMPHREY. Mr. President, I ask unanimous consent to insert in the body of the Recorp at this point a state- ment prepared by me regarding the President's message to Congress on July 19, 1950, together with pertinent ar- ticles and an editorial. There being no objection, the state- ment, articles, and editorial were or- dered to be printed in the Recorp, as follows: STATEMENT BY SENATOR HUMPHREY RoGarD- ING PRESIDENT'’S MESSAGE TO THE CONGRESS ON JULY 19, 1950 I strongly support the recommendations embodied in the President's message of July 19. The President has reported the develop- ments in Korea and given to the Congress a factual statement of action taken on the part of our Government in response to the resolution of the United Nations. This statement should reassure the American people of our activity and the purposes for which we have dedicated the strength and