APPENDIX TO THE CONGRESSIONAL RECORD trade agreements, unemployment insurance, social security, and bills of like nature, all involving revenue. A bill comes before us in one of three ways. It 1s either introduced by a Member of the House and referred to our committee, or 1t is prepared by one of the departments and is introduced by the chairman of the committee as an admin- istration bill, or, recommendations are made by the President in his message and from those recommendations the committee works out a bill ofitsown. Although we talk about the “tax bill of 1950” today, actually no such pill has been introduced. We are still in the deliberative and formative period of the bill and have only reached tentative agree- ments thereon. When we have come to final conclusions on the various matters that are to go into the bill, it is referred to the draft- ing service. After it is returned from the drafting service we again go over the bill for final correction and 1t will then probably be introduced by the chairman of the com- mittee, if he is in favor of the bill. Follow- ing this formality, the bill is then referred bask to the Ways and Means Committee; we take a formal vote upon it and favorably report it out. We then go before the Rules Committee to get a rule which determines the length of time that will be allotted for debate on the bill and the conditions under which the debate will be held. Usually when a tax bill is reported, we obtain what is Known as a closed rule—at least that is what you call 1t on the majority side— while, if you are in the minority, you protest vigcrously against the gag rule. The pur- pose of the closed rule is to prevent any amendments from the floor and you must take .t or leave it. You can imagine the precarious position of those who are caught in the present net that has been spread to catch the so-called loophole tax evaders when these provisions are tied up with pro- visions that would reduce obnoxious excise taxes. Whether or not there is a loophole, or whether the committee discovers new sources of tax revenues heretofore not tapped, the situation is equally precaricus for those who have previously legally enjoyed tax exemption. In view of the fact that the proposed 1950 tax bill will contain substantial excise tax reductions, it is fair to assume that in an election year the Congress will vote for a pill that will reduce taxes, even though there may be some things in the bill with which they might not generally agree. When the bill has passed the House it is sent to the Senate and referred to the Senate Finance Committee which, in turn, goes through a procedure somewhat similar to that before the Ways and Means Committee. After the Senate has exercised its prerogative as “elder statesman” and has amended the bill to the collective satisfaction of its Members, it goes into coxiference and then the hatchet work is done. I might say that the conferees ar2 selected by seniority. So that you might understand more clearly what this means, I have been in Congress 11 years—I am now in my eighth year on the Committee on Ways and Means—and for the first time I was selected as a conferee on the recently passed tax bill affecting life-insurance com~ panies. I might say that I was selected for the reason that some of my seniors stepped aside so that I might be chairman of the conferees. I recite this to you in order that you might know—and particularly that the presidents of savings banks in Bronx County might realize—the importance of a conferee and might understand the necessity of urg- ing the reelection of your speaker of the evening. ' We go into these matters rather thoroughly and it was from a study of the history of mutual savings banks that I learned, for instance, that the original founders of mu- tual savings banks were religious leaders and that the members of your orgenizetion have some of the solid religious *™' .-c.7 s of your forebears 1n the mutual savings banks industry. Moreover, I, being both a lawyer and an elected public official, and at the same time having very firm religious convictions of my own, needed only to consult the counsel of Thomas Jefferson regarding the close tie be- tween thrift and religion. Jefferson wrote John Page, “Would a missionary appear, who would make frugality the basis of his reli- gious system, and go through the land preaching 1t up as the only road to salvation, I would join his school, though not gener- ally disposed to seek my religion out of the dictates of my own reason, and feeling of my own heart.” Of course, as demonstrated by the fable of the ant and the grasshopper, thrift is not universally embraced as a virtue. From Pub- lius Syrus, the Roman, we have the assertion that frugality 1s missry in disguise. Now I must confess, in all candor, that my own view lies somewhere between Thomas Jefferson on the one hand and Publius Syrus on the other, I would not accept the view of the philosopher that, “Let us all be happy and live within our means, even if we have to borrow the money to do it with.” But I believe my own conviction was best expressed by Samuel Johnson, that “A man who both spends and saves money is the happiest man, because he has both enjoy~ ments.” I make no pretense to having the fervent, rigid adherence to thrift that may be re- quired for membership in your association. I must say that I admire the beneficent works of the Reverend Dr Henry Duncan (who perhaps appropriately founded the first modern savings bank at Ruthwell, Scotland, in 1810), as well as his counterparts in this country, including New York’s own Thomas Eddy and DeWitt Clinton. But to come hack to 1950—as you know, the Committee on Ways and Means is in the process of drafting a major tax bill. The committee’s work was initiated in response to a Presidential message suggesting that some excise tax reductions were in order at this time, provided the resulting loss of revenue waS made up through the enact- ment of loophole-closing legislation. The committee is aware, as I am sure you are also, of the desirability of reduction in the excise field in order that we may stimulate business and maintain a high level of em- ployment. The excises are still at their wartime peak and in many cases the rates are almost punitive. Some of these rates were imposed during the war in an effort to discourage the consumption of strategic ma- terial and the use of labor needed in the war industries. These rates are inappropriate at the present time. We are in a so-called peace economy, in which we are endeavoring to stimulate production and to absorb in em- ployment, not only those who were in the armed services, but the 500,000 or 600,000 of new annual entrants into the employment market. We are confronted with depressed business activities in certain fields and while the latest labor reports show that 60,000,000 people—the largest in the history of our country—are now employed, we must see that there is no deterioration in the standard of living of this increased labor group. To do that we must stimulate business, particu- larly in those depressed lines, such as jewelry, furs, leather goods, and other similarly af- fected industries. In some cases involving the admissions tax on movies, theaters, din- ing room service in hotels, where a singer is engaged to sing the Star Spangled Banner, and in so-called cabarets and night clubs which employ hundreds and thousands of people, the 20-percent tax falls unduly heav- ily. In other cases involving the tax on transportation of persons a real hardship is A3755 experienced, while the tax on transporta- tion of property is so recurrent that in the case of a manufactured article it constitutes a substantial portion of the cost of produc- tion, as the transportation of each part is taxed as well as the finished product. In other cases such as in beer and light wines, the taxes unquestionably discriminate against persons of comparatively modest means. In short, there can be no doubt that excise revision is highly desirable. The task of the Ways and Means Commit- tee in its endeavor to reduce excise taxes might indeed prove somewhat pleasurable if, first, we could satisfy anyone without complete elimination of the tax on the article in which he is most interested, and, secondly, if we were relieved of the responsibility of raising, otherwise, taxes in an amount equal to the excises we reduced, in order to prevent the national deficit from growing greater. Major tax reductions have already been made in two primary sources of wartime revenues, namely, the taxes on corporate and individual net incomes. The feeling through- out the country is today that excise reduc- tion is overdue by reason of the fact that the last wartime increases in the excise rates, made in 1943, were enacted with the clear and distinct stipulation by the Congress of the United States in solemn assembly and enacted into law by the signature of the President, that these excise taxes would be removed within 6 months after the cessation of hostilities. While the Committee on Ways and Means recognizes the strong merits of an excise reduction program, it is also acutely aware of the fact that the Federal Government is running a deficit of major proportions in the current fiscal year and may show an even larger deficit in 1951 if expenditures are not held to the budgetary levels or business con- ditions begin to slack off. The staff of the Joint Committee on Internal Revenue Taxa- tion has estimated that the deficit for the fiscal year 1950 will be $6,700,000,000, and that the deficit for 1951 will be $7,300,000,000 even if expenditures are held to the levels contained in the Fresident’s budget message. Hence the committee is making a vigorous effort to work out a balanced tax program in which the excise reductions which the committee has tentatively agreed upon and which, as you probably know, involve an annual revenue loss of about $1,000,000,000, will be offset by increased revenues from other sources. I am sure that you will recognize that it is not an easy task to raise that much ad-~ ditional revenue, particularly from a tax system which is already overburdened and which, through its depressing effects on both consumer purchasing power and incentives, threatens to become a real obstacle to the continued progress of our country. It is especially difficult to raise additional revenues of this size by the loophole-closing route. Many of the suggestions which the committee has received appear to be meri- torious but promise no substantial amounts of revenue. Other suggestions have to be discarded because of the serious adminis- trative difficulties which they would produce,' and a good many are unacceptable because they involve changes in the fundamental principles of the income-tax law which are not acceptable to the committee. Because of this situation it is not sur- prising that the tax exemptions provided in section 101 of the Internal Revenue Code have received close scrutiny. A good deal of revenue is involved, and, as you know, in~« terest in these exemptions has been stimu~ lated by a well-organized and determined agitation on the part of a group of business< men who regard the exemptions as a loop- hole and believe they have fostered unfair competition. While the center of the stage
A3756 has been held by the dispute over the ex- emption of farm cooperatives, and the spec- tacular tax-avoidance schemes such as the lease-back arrangement used by certain edu- cational institutions and insurance com- panies, it was inevitable that the committee’s studies should extend to the other institu- tions which benefit under section 101, in- cluding the mutual savings banks. I am impressed with the history of faith- ful public service of the mutual savings banks in providing a safe and secure deposi- tory of the small sums saved by the journey- men, the coachmen, the chambermaids, and the artisans. Without the savings banks in the days before series E savings bonds, these workmen of humble background would have had no safe place to keep their savings. When one views the 188-year history of successful operations of the mutual savings banks, however, I believe that he is likely to be impressed with a paradox difficult to explain. Why is it that there is about one account for every three inhabitants of the territory that savings banks serve (and in New England and New York the proportion is even greater), yet the operations of sav- ings banks are Mmited to only 17 States, and the majority of them are in the New Eng- land and Middle Atlantic States. I know that the textbook writers explain that the pioneer country had great demand for the money and credit which ordinary commercial banks would provide while sav- ings banks, being more conservative in lend- ing policy, could not meet the need. It has been suggested that the farmers and miners of the West have an independence of spirit and a recklessness fof adventure that did not require the protection afforded by the savings banks in the eastern cities for indus- trial employees. The testimony before our committee em- phasized the cooperative nature of mutual savings banks, the fact that they have no capital stock outstanding and are operated by trustees, and that ultimately all of the assets belong to the depositors. Emphasis was placed also upon the character of the business done. The small size of the average deposits was stressed, as was also the fact that these deposits were by and large held by persons of comparatively modest means. In particular, attention was directed to the im- portance of school savings and Christmas club accounts. The honorable history of these institutions and the long-standing character of their exemption under the Fed- eral income tax was pointed out. Finally, it was argued that any tax imposed on mutual savings banks would reduce their ability to accumulate surplus which, in connection with a continued expansion in their deposits, would tend to weaken the banks and in- crease the risks of their depositors. It was pointed out also that State laws required the accumulation of a surplus for the protection of the depositors and that a conflict would exist between these laws and a tax which impeded the accumulation of the desired sure plus. These are indeed impressive argu- ments. Your general counsel, Mr. Fred N. Oliver, accompanied by Mr. Earl B. Schwulst, Jr., President, Bowery Savings Bank; Mr. A. George Gilman, Malden Savings Bank, Mal- den, Mass.; and Mr. Henry Powell., executive secretary, Savings Banks Association of the State of New York, gave us the following sta- tistics—that as of December 31, 1949, the total deposits of savings banks amount to over $19,000,000,0000, the total assets, $21,- 500,000,000, total depositors over 19,000,000, and an average deposit per account of ap- proximately $1,000. Now, the record of safety and security of the mutual savings banks in handling the deposits left with them by small depositors is admitted. I should point out that these depositors re- ceived on the average an interest rate of 1.78 percent in 1948. In contrast, the yield on series E bonds held to maturity is approxi- mately 2.9 percent, and even series F and series G bonds yield 2.5 percent. I repeat, therefore, why should small investors leave their savings with the mutual savings banks? Why is it, and why should it be, public policy to grant an express exemption from Federal corporate income taxes for mutual savings banks? I ask these questions appreciating full well your great record of nearly a cen- tury and a half of service. I do so as a friend, however, to suggest that perhaps in- vestment practices which result in more than 52 percent of the assets of mutual savings banks being invested in securities of the Federal Government might be reexamined. Your representatives told the Committee on Ways and Means that there is a shortage of sound investments yielding a higher rate of interest. They related the experience of the Bowery Savings Bank in purchasing at premium prices FHA insured mortgage loans and your current efforts to negotiate with the Federal National Mortgage Association to buy a substantial amount of their portfolio. The real question, it seems to me, is whether the mutual savings banks have an additional obligation to make available their best judg- ment in seeking out on a selective basis in- vestment opportunities for the great number of low- and middle-income wage earners and salaried employees. Unless the savings banks can provide @ service in this respect which these people cannot provide for themselves, why should they share with the savings bank the return which they can obtain through a direct investment in a Government savings bond or in some other investment guaran- teed by the Government. This leads me to the next question—if mutual savings banks are no longer providing to the public the service which led to their great growth and expansion on the eastern seaboard, why should they be given any spe~ cial consideration under the internal-revenue laws? I think it is generally acknowledged that the corporate tax should not be im- posed on amounts distributed to depositors, but according to the information given to the Committee on Ways and Means by your representatives, mutual savings banks now have retained reserves in excess of $2,000,- 000,000. According to your representatives, savings banks’ earnings in 1948, after ex- penses, totaled $423,000,000, yet only $302, 000,000 were actually paid to depositors. In view of the fact that savings banks are now investing primarily in Government bonds and Government-guaranteed obligations, it is claimed that there is little justification for the accumulation of the large reserves that have been wisely available in the past. Con- sequently, a tax policy which provides a tax exemption for such accumulated reserves is understandably under close scrutiny at a time when the present high tax rates on the tax-paying sector of the economy are bearing 80 heavily. The need for Federal revenue makes it essential to scrutinize tax exemp- tions at the present time much more closely than has been done in the past. Gentlemen, I have given you the pros and cons as faithfully as I am capable of the question of the taxation of mutual savings banks. I presume that you have all an- swered the question in the negative, prob- ably without taking into consideration the viewpoint of the affirmative. I think you would be interested in knowing that I voted against this tax. I voted against this tax for a number of reasons, some of which are as follows: Savings banks are essentially a regional institution and fundamentally there is no APPENDIX TO THE CONGRESSIONAL RECORD difference between the mutuality of a sav- ings bank and the mutuality of a farm co- operative—and I am opposed at this time to taxing the people in the cities and urban districts of the New England and Middle Atlantic States and letting the farmers in their mutual organizations gofree. Further- more, I am fearful that by this tax we will encourage the distribution of income rather than to build up the reserves and that after all insurance is only a secondary objective and the real bulwarks against depression are the original assets of a bank. My third ob- jective is that in my opinion this might amount to taxation by entrapment. In other words, as I understand it, today 69 percent of the savings banks are insured in FDIC. It seems to Me apparent that the in.« suring company has the right to determine what reserves should be set up by those com- panies which it insures. It is apparent, therefore, that the greater reserves demanded by the Federal agency for insuring savings banks will result in greater revenue through income taxes for the Federal Government. This does not take into account the various State laws that establish reserves and this proposed provision may very well be used to beat the States into submission to con~ form with the reserve policy of FDIC which, in turn, might well be determined not by the safety ratio, but by the political necessities, Even though it be the eleventh hour, I sug- gest that you reexamine your whole struc- ture and see whether or not you are today performing the function for which you were established and for which tax exemption was granted. In your conservative appraisal of your investments have you restricted your- selves so that instead of being helpful to the development of your community you are more intent to invest your deposits largely in Government bonds and Federal secured mortgages. I fear you have been lulled to sleep by the morphine of Federal security. Are you now so addicted to conservatism that you are willing to sacrifice the institutions which you have established and maintained, so that by your conservatism you may escape the criticism of possible loss. Many a per- son has died becaues they have not had the will to live. Have you the will to survive or are you going to let the Federal Govern- ment continue the mortgage loan business and savings business? Don’t you say you can’t compete. You can, if you will, but you haven’t shown the will, "f you want security, you can have it for a price—that is extinc- tion. The time will come, and in my opinion it is not far distant, when your depositors will prefer postal savings or Government bonds to your meager interest rate. The mortga- gees will demand that the Government take over their mortgages and eliminate the middle man, the savings bank, to which the mortgagee pays what he considers high in- terest for a loan of money guaranteed by the greatest country on the earth. Look at your portfolios—not with an eye to the proportion of Government securities and Government guaranteed mortgages to total assets—but with an eye to the ratio between Government securities and Govern- ment guaranteed mortgages acquired since war's end to your new investments of the same period, and determine for yourselves whether you will fight for survival in compe- titlon with the Government, or whether you will peacefully succumb to the opiate of governmental beneficence, Gentlemen, this is the time for courageous, determined, and decisive action. This is the time when the glorious history of our in- dustry should embolden you to fight for the principles upon which your institutions were founded. The zero hour has not struck. It is still not too late, but it is later than you think.
APPENDIX TO THE CONGRESSIONAL RECORD Attack on Louis S. Budenz by Hon. Dennis Chavez, of New Mexico EXTENSION OF REMARKS fo) HON. JOSEPH R. McCARTHY OF WISCONSIN IN THE SENATE OF THE UNITED STATES Thursday, May 18 (legislative day of Wednesday, March 29), 1950 Mr. McCARTHY. Mr. President, I ask unanimous consent to have printed in the Appendix of the Rrcorn a state- ment of the Reverend Laurence J. Mc- Ginley, S. J., president of Fordham Uni- versity, in reply to the attack on Louis S. Budenz by the Senator from New Mexico (Mr, CHAVEZ]. There being no objection, the state- ment was ordered to be printed in the Reconp, as follows: STATEMENT OF THE REVEREND LAURENCE J. McGINLEY, S. J., PRESIDENT oF FoRDHAM UNIVERSITY, IN REPLY TO THE ATTACK ON Lovis F, Bupenz sy SENATOR DENNIS CHavez, OF New MExIco, ON THE SENATE FLOOR Prof. Louis Budenz joined the faculty of this university in 1946. Since that time he has given complete satisfaction in the discharge of his academic duties. Within the limits imposed on him by his obliga- tions as a scholar and teacher, he has at times complied with the requests of public and private agencies to lecture on the phi- losophy of communism and on the subver- sive techniques of the Communist Party. This was done with the knowledge and con- sent of the university authorities. During his years at Fordham, Professor Budenz has deserved and continues to enjoy the full confidence of the university—both as a teacher and as a Christian gentleman. From time to time, much to his own in« convenience and the occasional inconven- ience of the university, Professor Budenz has been subpenaed by the Government to tes- tify in cases involving alleged Communists or Communist activities. It has always been his wish that such information as might be sought from him by the Government be given solely on his own responsibility. He foresaw that he would be subjected to violent attack from Communist quarters and he did not wish to involve the university. It has remained, however, for a member of the United States Senate to bring this personal vilification of Professor Budenz to ® point even lower than that reached in the columns of the Daily Worker. It might fairly be said that never within recent mem-~- ory has a Member of Congress so used his immunity in personal atiack upon the char- acter of a fellow citizen. The Senator had the effrontery, moreover, to pOse as a Catho- lic while publicly enacting this vicious of- fense against Christian charity. As a priest of the Catholic Church, and as president of the university of which Professor Budenz is a@ respected faculty member, I cannot allow so slanderous and cowardly a demonstration to go unanswered. Under Government subpena, Professor Budenz has appeared as a witness in many trials over the last 5 years. He has, as was to be expected, when he testified against Communists or Communist activities, been castigated both here and abroad by. those whose conspiracy he was called upon to ex- pose. Never, to my knowledge, have re« sponsible officials of our own Government or members of the American press had other than praise for his conscientiousness as a witness. XCVI—App.——287 It was not until he went recently to Washington—once again not at his own re- quest but under subpena from a Senate committee—to testify in an inquiry into ale leged Communist influences in our own Gov-= ernment, that those who should have been his friends turned on him with that weakest and most cowardly of all weapons, slander~= ous attack on his character and his family. As an American and a teacher of young Americans, I find Senator CHAVEZ’ attack dis- turbing in the extreme. As a priest, I must denounce the hypocrisy and uncharitable- ness that characterized it. Whatever mistakes Professor Budenz has made in the past are an open book. Un-= fortunately for him, he has had to live under the constant threat of Communist reprisals, and to bear in silence the sneers of modern pharisees who are always ready to point a self-righteous finger at their fellow man. The Catholic Church, convinced of the sin- cerity of his repentance, welcomed Louis Budenz back into the fold. Let those who in the name of the church of charity presume to shout another man’s alleged transgres- sions from the housetops, look instead into their own hearts. Communism at Home—FEPC—White Americans Betrayed REMARES OF HON. JOHN E. RANKIN OF MISSISSIPPI IN THE HOUSE OF REPRESENTATIVES Thursday, May 18, 1950 Mr. RANKIN. Mr. Speaker, it is not only useless, but ridiculous, for the ad- ministration, or anyone else, to advocate spending billions of dollars of the Ameri- can taxpayers’ money in foreign coun- tries under the pretense of fighting com- munism abroad, and at the same time attempting to impose communism upon the American people here at home. These attempts to ram the FEPC down the throats of the people of this country is simply following the Communist line; and this persecution of the white people in the District of Columbia through this so-called antisegregation movement has reach a state of degredation that I never dreamed I would ever live to see in the Nation’s Capital. Remember the Communists, their stooges and fellow travelers, do not give a “tinker’s dam” about the Negroes. They are simply using the Negroes as a smoke screen to force this commu- nistic program on the American people. It is a part of the Communist program for the destruction of this country. Thomas Jefferson would turn over in his grave, if he could hear this commu- nistic FEPC program advocated in his name and hear his words twisted or mis- interpreted to fit a program of commu- nistic compulsion, by which white Amer- icans in the District of Columbia are per- secuted as they have never been perse- cuted before—and see the attempis made to extend this persecution to white Americans everywhere. Whether the President knows it or not, this is a communistic scheme to under- mine this country and destroy the white man’s civilization throughout the world. A3757 - It is being fostered and pressed by alien- minded minorities that have for their purpose the amalgamation of the races and the destruction of the white man’s civilization, and wiping Christianity from the face of the earth. Here in the District of Columbia white children are driven from their play- srounds and swimming pools, white people generally are driven from certain theaters and other places of amusement. These alien-minded real-estate agents are driving the white people of the Dis- trict of Columbia out of their homes and forcing them to move over into Vir- ginia for protection, by selling Negroes homes in their midst—thereby bringing about a condition that causes white peo- ple to have to sell their homes and move across the Potomac River. As I have said before, these Commu- nists do not give a tinker’s dam about the Negroes. They are simply using them as a@ smoke sereen to carry out their infamous designs against the white people of this country. They are doing the Negroes infinite harm. if President Truman does not know what is going on, he had better get some advisers who can give him the facts. If he does know what is going on, then he ought to call a halt. I exposed this communistic FEPC on the floor of this House 2 years ago. When Mr. Dewey, Governor of New York, signed the bill imposing that vicious measure upon the people of New York, I said at the time, that “all the perfumes of Arabia would not sweeten his little hand.” Something like a million copies of that speech have been printed and circulated. throughout the land. Everywhere this vicious measure has been introduced in the State legislature, and the Members have read copies of that speech; they have killed the measure in every single instance. If it was referred to a vote of the peo- ple in the various States and they were informed as to what it means, they would do just what they did in Cali- fornia—defeat it by an overwhelming majority in every single individual coun- ty. They would kill it so dead you would never hear of it again, They have this vicious law on the stat- ute: books in the States of New York, Massachusetts, Connecticut, Rhode Is- land, and New Jersey, and have spent millions of dollars trying to force it on Pennsylvania, Ohio, Michigan, Illinois, California, Minnesota, Colorado, and other States; and, as I said have failed in every instance. The best service the Legislatures of the States of New York, Massachusetts, Con- necticut, Rhode Island, and New Jersey could possibly render their people would be to repeal this vicious measure at once and stop giving aid and comfort to those enemies of America that are -trying to impose it upon the entire Nation through the Congress of the United States. In my speech in the House on February 13, 1947, in discussing this measure, I said: I want to read you some of the regulations that are now being imposed upon the people of the State of New York under this vicious
A3758 law. Businessmen from New York tell me that the way they are getting around this measure is by operating through employ- ment agencies, because no intelligent pusi- nessman would go to a State with that kind of law on its statute books and attempt to establish a new business or a new enter- prise, especially with the regulations or rul- ings under it which I am now going to read to you. Remember they put this measure on the ticket in California and the people voted on it in the last election; and it lost in every sing’e individual county in California. It was beaten in the entire State by about 3 to 1. You simply destroy business with a measure like this. That is what the FEPC did here. Men h-ve gone out of business all over the country in the last few years because of the persecution that was carried on by this outit here in Washington, the personnel of which I shall insert later on. A few people are going around urging us to pass it as a national law, to put everybody else in the seme predicament. These people who are carrying on this racial agitation are using the Negro as a smoke screen. They do not give a tinker’s dam about the Negro. They are not trying to help the Negro. They are Going them more harm than anybody else has Gone in the last 50 years, and the decent law-abiding Negroes know it. But let me show you what they have done in New York, and let me give you some of the regulations or rulings, as they are called, and ask you if you would like to have them in your State. I want to ask the gentleman from Illinois [Mr. Dirksen] how he would like to have them in Illinois, or how you would like to have them in Ohio, Indiana, Pennsylvania, or in Missouri, or in any other State in the Union. Here are the regulations, or rulings, issued by the State of New York. They are headed: “state of New York Executive Department, State Commission against discrimination. Rulings.” Here are the rulings: I want to show you some things you cannot ask in the State of New York when you go to employ a man. Remember that State has no gas, coal, or oil, and very little water power. The rest of the country does not have to go to New York, or to any other State, to get what it needs in the years to come. The American people in every section of this country are in a position now to take care of themselves. You put this measure on in one State after another and you will simply penalize those States beyond reason, and when they ask you to pass it for the whole United States and put it on the entire American people, after the fiasco they have made of it here in Wash- ington in the last few years, it is simply un- thinkable to a man who knows what he is doing and has the interest of the people of the country at heart. Here are some of the things you cannot do under the law of New York: UNLAWFUL EMPLOYMENT PRACTICES BEFORE EXIRING ANYBODY Those words are written in capitals. is the first unlawful practice: “Iquiry into the original name of the ap- plicant for employment, whose name has pbeen changed by court proceedings or other- wise.” If you inquire as to his name or what his name used to be, you violate the law. You commit an unlawful practice. For instance, take this man who writes for PM, who calls himself I, F. Stone. His name was Isadore Fainstein, as Cordell Hull once pointed out. Suppose he comes to you asking for employ- ment and you ask him that question. Then you will have committed an unlawful act. Here is the next one: It would be unlawful practice to make— “Inquiry into the birthplace of the appli- cant for employment, the birthplace of his parents, spouse, or other close relative.” Here How would you like that in Iowa, Illinois, Texas, or Nebraska? In Calfornia I know you do not like it, because you have just voted on it. Here is the next unlawful practice. “Requirement that the applicant for em- ployment produce a birth certificate or bap- tismal certificate.” That would be an unlawful practice under this FEPC Act in New York. I was surprised to see Governor Dewey get his mustache in the wringer on this propo- sition. I do not see how he 1s ever going to get loose from it. Mr, Mason. Mr. Speaker, will the gentle- man yield? Mr. RANKIN. I yield. Mr. Mason. What about this requirement during the war that every person employed in certain industries had to prove that he was born here before he could get a job? Mr. Ranxin. Certainly. If we had this law all over the country then, the Japs would have had a spy at the elbow of every man in a key position; so would the Germans, and so would every other enemy country. I thank the gentleman from Illinois for his timely suggestion. It 1s an unlawful practice in New York, under this law, to make— “Inquiry into the religious denomination of an applicant for employment, his religious affiliations, his church, parish pastor, or re- ligious holidays observed. Inquiry into whether an applicant for employment is an atheist.” Inquiry into whether an applicant for em- ployment is an atheist is forbidden, although you may be publishing literature for the Methodist Church, the Baptist Church, or any other denomination. Another thing, an applicant for employ- ment—and I am reading from the rules laid down by this Commission: “An applicant for employment may not be told that this is a Catholic, Protestant, or Jewish organization.” In other words, if you are in the busi- ness of publishing religious literature you cannot even give him that information under this law which the gentleman from Illinois [Mr. Dirksen] now proposes for the whole country, including Illinois. Here is another unlawful practice: “An applicant for employment may not be told that the following holidays will be ob- served by the firm and no others, naming the holidays; e. g., Decoration Day and July the Fourth, etc.” You cannot tell them under the laws, rulings, and regulations of the State of New York that they may observe the Fourth of July. Here is another unlawful practice: “An applicant for employment may not be told that employees are requircd to work Rosh Hashana and Yom Kippur.” Frankly, I did not know there were any such days until the last few years. Another thing, it is an unlawful practice under this New York law to make— “Inquiry into the complexion of an appli- cant for employment.” Inquire into his complexion and you are likely to get yourself tangled up with the law of the State of New York. Hore is another unlawul practice: “Requirement that an applicant for em- ployment annex a photograph.” That would be an unlawful employment practice. You are not supposed to know how he looks. Remember, this is not in Russia, but in New York. Mr. Mason. Mr. Speaker, will the gentle- man yield? Mr. Ranxrn, I yield. Mr. Mason, And yet the State Department in order to grant a visa requires a photo- graph of the person to be presented with his application, APPENDIX TO THE CONGRESSIONAL RECORD Mr. RANKIN. Certainly, and they ought to do so. Much as I respect the distinguished gentleman from Illinois [Mr. Mason], I cer- tainly would not want to employ him unless I knew how he looked. If I had never seen him, I would certainly want to see his pic- ure. Here is another unlawful practice: “Ynquiry whether an applicant for employ- ment is a naturalized or native-born citizen; the date when the applicant acquired citi- genship; whether the applicant’s parents or spouse are naturalized or native-born citi- gens of the United States; the date when such parents or spouse acquired citizenship.” You cannot inquire into those questions under this FEPC law in New York. Here is another unlawful practice: “Requirement that an applicant for em- ployment produce his naturalization papers or first papers.’ He may lie to you and tell you that he is a naturalized citizen, but you cannot ask to see his papers. Another unlawful practice in New York is to— “Inquire into the lineage of an applicant for employment, his ancestry, or national origin.” You remember a few years ago the Dallas News inserted an advertisement for a colored janitor, and this FEPC outfit down the street ordered them to take it out, said it was an unlawful practice. One member of this FEPC outfit here in Washington went into the office of Switt & Co. in Chicago. This FEPC man asked them: “How many Negroes do you have on your board of directors?” . The answer was “None.” Then the FEPC man asked him: haven't you?” That was the FEPC down here in Washing- ton a few years ago before it died because a few radicals could not browbeat Congress in perpetuating it. But it is now in force in the State of New York. Here is another unlawful practice under the New York law: “Inquiry into the location of places of busi- ness of relatives of an applicant for employ- ment,” It is an unlawful practice to make— “Inquiry into the place of residence of the parents, spouse, or other close relatives of an applicant for employment.” I am reading from the records at Albany. Here is another unlawful practice: “Inquiry into the maiden name of the wife of a male applicant for employment and/or inquiry into the maiden name of the mother of a male or female applicant for employment.” The other day we had the Eislers down” here. One of them has been shown to be representing the Comintern, according to his sister’s testimony. He has a brother out in California, who seems to be poisoning the public mind through the moving-picture in- dustry. He tries to defend his brother and refers to this woman as “my former sister.” If you wanted to employ any of them and check the name of at least one of them as given here, you could not inquire into those names at all—if you are trying to do business in the State of New York—even though one of them has a half dozen aliases. You could not even ask where they came from or when they got here or when they changed their names. Here is another unlawful practice, in New York: “Inquiry into the general military experl- ence of an applicant for employment.” I wish every ex-serviceman could read that, and the next one. Here it is. It is an unlawful practice to make— “Inquiry into the whereabouts of an ap- plicant for employment during the First “why
APPENDIX TO THE CONGRESSIONAL RECORD World War, i. e., during the period from 1914 te 1919.” In other words, inquiry as to his where- abouts in the period from 1914 to 1919 is forbidden as an unlawful practice in the State of New York. Is that what you want in Colorado? Is that what you want in Massachusetts? Mr, Girrorp. We have it. Mr. RaNKIN Get rid of it, and we will help you. Is that what you want in Kansas, in Ohio, and in other States? Let your States vote on it. Michigan is going to vote on it right away. If you will tell the people of Michigan the whole truth, let them know the whole truth about this monstrosity. I will guarantee you they will beat 1t worse than they did in California, Here is another unlawful practice: “Inquiry into the organizations of which an applicant for employment is a member, including organizations the name or char- acter of which indicates the religion, race, or national origin of its members.” I presume, if they should ask me if I am a member of the Masonic lodge, I could have them jerked up and brought before this in- quisition board or probably prosecuted at various places throughout the country. Mr. Speaker, I am not criticizing the peo- ple of Néw York. I have long since learned in going from one State to another that real Americans are about the same everywhere, I believe, if they had a vote on it, the people of New York would beat it, just as they did in California. They are having a vote on it in Michigan because a little minority group has been attempting to browbeat the Legislature of Michigan into passing it. I dare say when it goes on the ballot in Michigan and the people of Michigan understand what it means they will defeat it more thoroughly than they did in California. The same thing would happen in probably every other State in the Union. Mr. Aucusr H, AnpresEeN. Mr. Speaker, will the gentleman yield? Mr. Ranxin. I yield to the gentleman from Minnesota. Mr. Aucusr H. ANDRESEN. Will the gentle- man tell us what the penalties are in New York? Mr. RANXIN. In addition to being harassed to death with orders and directives to cease, desist, rehire, etc, there is a punishment provided of “imprisonment in a penitentiary or county jail for not more than 1 year or by fine of not more than $500, or both.” Mr. Girrorp. Mr. Speaker, will the gentle- man yield? Mr. RANKIN. I yield to the gentleman from Massachusetts. Mr. Girrorp. I want to remind the gen- tleman that we have that law in Massachu- setts. Mr. Ranxuin. I was afraid of that. Mr. Gurrorp. I was thoroughly amazed when I looked into it; I had not learned what the rules were. But, perhaps we car- ried it too far. I am so sorry, and I have been, and I am not in favor of this, I can assure the gentleman. Mr. Rawxmy. I know the gentleman is not, and I am sure the people of Massachusetts would not favor it if they had a vote on it, Mr. Guirrorp. Employers always inquire and must know whether you come from a respectable family or not. They are so care- ful. Perhaps they overdid it. But I think @ man ought to be able to find out whether he came from a respectable family. Mr. RANKIN. There are a great many ques- tions that should be asked, which are for- bidden under this law. Mr. Speaker, in order to give the new Members an idea of what a mess this FEPC was here in Washington during its exist- ence under Executive order, I insert a speech I made on this subject in 1945, It reads as follows: “FEPC a BETRAYAL OF WHITE AMERICANS “(Speech of Hon, JoHN E, Rankin, of Missis- sippl, in the House of Representatives, Thursday, July 12, 1945) “Mr, RANKIN. Mr. Chairman, the passage of a law at this time legalizing this so-called FEPC would be a betrayal of the white peo- ple of the country. If every individual in the United States could understand just what it means, there would be such a roar of protest coming from every State in this Union that it would never see the light of day. “If every Member of Congress would ‘screw his courage to the sticking place’ and vote his convictions on this so-called FEPC, it would not get 50 votes out of the entire membership of 435, “It is a most dangerous and brazen at- tempt to fasten upon the white people of America the worst system of control by alien or minority racial groups that has been known since the crucifixion. “When I read the names of the personnel of this outfit you will understand what I mean. “To sanctify this organization by law would give the lie to everything we have told our American boys they were fighting for. Instead of coming back to liberty, free- dom, and democracy, they would find them- selves sold into this bondage, herded, humiliated, and regimented by alien influ- ences directed by a foreign comintern rep- resenting the deadly doctrine of Karl Marx that is based upon hatred for Christianity and for everything that is based on Chris- tian principles. “It is a manifestation in legislative form of that infidelity that has closed thousands of Christian churches in Hurope and been re~ sponsible for the murder of untold millions of Christian human beings. “This measure is not directed altogether at the white people of the South, If it were, you folks in the North would not have so much ground for alarm. We in the South know how to combat subversive elements. As Henry Grady once said, we wrested the South from such domination ‘when Federal drum beats rolled nearer and Federal bayo- nets hedged closer to the ballot box of the South than it ever will again in this Re- public.’ “But you people in the North have not had that training, and this FEPC is likely to bring grief, strife, hatred, race riots, and chaos in your northern cities if this vicious agency is perpetuated and sanctioned by your votes. “Do not forget that the returning service- men know what this thing means, and they are going to call you to account next year— beginning with the primary. They are not going to wait until the general election. “Do not forget that every businessman, every farmer, every professional man, and every other independent individual whose blood glows with the instinct of American liberty, is going to join these men, and those other patriotic forces that are fighting to save American institutions for which these boys have been fighting and dying upon every battlefield in the world. “If every man and every woman in the United States could just read the list of in- dividuals that compose the personnel of this crazy FEPC, and its subdivisions throughout the country, I dare say there would not be enough of you left who vote for it, even if nominated in the primaries next year, to form a corporal’s guard. “For your information, and for the infor- mation of the American people generally, I am going to read you the official personnel as it exists today. Remember, this list is taken from the official record. This is the group that wants: to nose into and control every pusiness in the United States. Remember, they can search the files and records of every A3759 business establishment in America where some disgruntled individual jis willing ta trump up a charge of discrimination. They can drag them all over the country and try them, and in that way destroy any ordinary business concern. . “The next thing they are going to try to do is get control of your schools and force their communistic henchmen into the schools and teach your children their subversive doc- trines, “Read these lists carefully, which, as I said, are taken from the official records here in Washington, and you will see that not one out of ten on these rolls is a white gentile American. “Here is the official list: “Committee on Fair Employment Practice, Washington, D. C., Office of the Chairman Sal- Incumbent Title Race ary Ross, Malcolm__...| Chairman...__.. White. ‘2 909 Johnson, George M_ Hubbard, Maceo... Deputy Chair- | Co.ored_} $, 069 man, Hearings exam- |...do....| 5,600 ner, Bloch, Emanuel___.|--.-. do.....-..--| White_..| 5, 600 Copper, Evelyn_...|--..- do__-.-.---.|--- dow... | 5, 600 Berking, Max...... Assistant to |..-do.___| 3,800 Charman. Alexander, Dorothy.| Secrets +e to ‘ Colored_| 2, 600 eT Clifton, J. Jeanne... Secretary to |...do..._} 2, 000 eputy. Brooks, Mary.....- Clerk-stenog- j---d0....| 1, 800 rapher, Banting, Myra....-|--.--d0_..---.-.- White...| 1, 800 “You will note that in this office of the chairman, consisting of 10 people, there are 5 Negroes and 5 white people, most of whom have foreign names. One of the whites is a stenographer who receives the smallest salary of anyone on the list. “Remember that the members of this group preside over the destiny of every business en< terprise in America, and are using their as- sumed powers to harass white Americans out of business. “This is the organization Members of Con- gress are being asked to perpetuate by the passage of this bill. “FIELD OPERATIONS “Here is the Division of Field Operations: “Field operations , Sal- Incumbent Title Race ary Maslow, Will.-.... Chief. ..-.-..-.- White...|$6, 500 Mitchell, Clarence..| Principal fair- | Colored_| 5, 600 practice ex- aminer. Davidson, Eugene..|._-.- G0...-.-.---}---' do...) 5,600 Beall, W. Hayes._..| Senior fair-prac-e | White_..| 4,600 tice examiner. Mercer, Inez__....- Fair-practice ex- |..-do....| 3,800 aminer, Rogers, Eleanor..../ Clerk-stenog- | Colored_| 1,800 rapher, Saito, Otome._....-]...-. Cl Tapa} 1,800 nose- Amer- ican. Thompson, Muldred_|...-.d0-..--.-00- Colored. 1,800 Cornick, Hmma..._|..... d0.n.--.-----|--- 0..--| 1,620 “You will note that it consists of nine people—five Negroes, one Japanese, and three others—two of whom have records of affiliations with Communist-front organiza- tions, according to the reports of the Dies committee. “Imagine this group going about over the country riding herd on the white American businessmen of the Nation, telling them whom they shall employ, whom they shall promote, and with whom they may associate. “It would be interesting, and probably en- lightening, to check up on these people and see how many of them are native-born Amer- icans.
A3769 “Members of Congress had better do this now, before they get caught in this trap, because this question of un-American ac- tivities is going to be an issue in every con- gressional district next year, beginning with . the primaries. “The people are not going to wait until the general election for someone who holds a commission as a result of the pernicious ac- tivities of Sidney Hillman and his gang to wrap the party cloak about him and shout to the people of his district that ‘I am a Republican’ or ‘I am a Democrat.’ “More than 2,000,000 young men have al- ready been discharged in this war, and they are organizing now to try to save America for Americans. They are going to read your records, and they are lkely to ask you some very embarrassing questions when you get home. “REVIEW AND ANALYSIS DIVISION “Now look at this list and see who reviews all these records of racial discrimination when they come to Washington, and you will understand how the editor of the Dallas News felt and how other white gentiles feel, in- cluding Cecil B. DeMille, the great American movie producer, when they are harassed out of business. “Here is the list: “Review and Analysis Division : Sal- Incumbent Title Race ary Pers Take A ~ | Chief...2.-e}] Ct ce oer J ,-t . 22, Research = ana- |..-uu--_-) J, dv lyst, Cohghtly, Corne- | Compliance an- |...do..__} 3, 200 lus. alyst, Hemphill, India... do ---d0....| 2, 600 Coan, Carol... White__.| 2, 600 Davis, Joy P.. -do Colored .| 2, 600 Hoffman, Celia.....| Clerk-stenog- hite...| 1, 800 rapher. Spaulding, Joan....]...-.do..........| Colored. 1, 800 “You will note that it consists of six Negroes and two white people, one of whom is named Carol Coan and the other Celia Hoffman, a white stenographer receiving the lowest salary on the list. “Now, if you sign the petition to bring out this bill or vote for this monstrosity, do not forget that when you get home those white American businessmen who help to sustain this Nation in time of peace and whose sons are fighting its battles in time of war are going to want to ask you some questions that you may not be able to answer. “LEGAL DIVISION “But if you want a real laugh, look at this Legal Division. “Legal Division Incumbent Titlo Race a Degree Peery 0 bate -- Colored. |$4, 600 ~ et Sa toe White...) 4, 600 [ Gs . Colored.| 1, 800 | phe. | “You will note that this so-called Legal Division consists of two Negroes and a Simon Stickgold, “INFORMATION DIVISION “Now we come to the Information. Division. If you want information about this outfit write to this Division: “Information Division Incumbent Title Bal. Race ary Bourne, St, Clair... Information Spe- | Colored.|$3, 800 Whiting, Margaret. oferk -Stenog- -owd0..4~] 1, 800 rapher. “You will note that it consists of two Ne- groes, one registered as an information spe- cialist and the other as a clerk-stenographer. “SUDGET AND ADMINISTRATION “Now we come to the Budget and Admuinis-~ tration Division. This Division not only makes up the budget but administers the regulations, Here is the list: “Budget and Administration Ty £al- Incumbent Title Race ary Tene mUN--F fone Chief. weeee nen ecee Crt aL ae RAN Cee ‘ Assistant ad- .. - te ministrative officer. Baker, Vivian D__- Clerk: stenogia- {|_..do..... 2, 000 phe Jackson, Bosales A- Clerk-typist_. ‘Paynter, Minnie A.|_._.. Hollomon, Irving... Glee Selby, Ralph Ross, Sylvia B Nelson, Otelza. Carpenter, Eliz beth, Brent, Pear] T “This outfit, which is composed of 11 Ne-~ groes, and no whites at all, not only makes up the budget for financing this aggregation, but 1t seems to have the power of adminis- tration. I hope you will read this list to your white businessmen, farmers, and ex- servicemen at home when you get back and ask for renomination in the primaries next year. “MAIL AND FILES DIVISION “Now, here are the ones that have control of the mails and filing system: “Maid and Files Incumbent Title Race Sale Douglas, Lela......) Chicf, Mail and | Colored. |$2, 000 Miles, Welch, Selena._.... Docket clerk. .../.--do.....] 1, 800 Gamble, Jessie. vee ire. Bic @. Ree: “You will note that this division is com- posed entirely of Negroes—six Negroes, and no whites at all. I wonder why they dis- criminated against the white race in setting up these two powerful branches of this most dangerous agency? “REGIONAL OFFICE, NEW YORK “Now, let us turn to the regional offices and see who is going to harass the business people back in the States. Here is the list for the State of New York: “Regional office, New York Ral- Title ary Incumbent Raco Lawson, Edward H.| Regional dirce- | Colored.}$5, 600 or. Jones, Madison S__.) Fair-practice ex- |...do.....| 3, 800 aminer, Jones, Rake 4 lL Ae, - An _. 3,800 Donovan .Re eee \ - 3,800 Trish, 2a. Jee Cc hres Cee QL 2,000 phor. Asopha, Tile. mes enna -LOsnnernvesee| White...| 1,620 Schwartz, Sonia... |--w., Jane geen nen | an LOnmen 1, 620 “This is the list that is going to help Gov- ernor Dewey harass the white American businessmen of the Empire State. You will note that it is composed of four Negroes and three white people. Please read the names of the three white people and see if you can figure out their antecedents. “Businessmen of New York are going to have a hard time after this war without having all this communistic conglomeration to deal with, to say nothing of the one which APPENDIX TO THE CONGRESSIONAL RECORD Governor Dewey and his political henchmen have now heaped upon them. “REGIONAL OFFICE, PHILADELPHIA “Now, let us turn to Philadelphia, the birthplace of the Constitution—the City of Brotherly Love. At the risk of causing glo- rious old Benjamin Franklin to turn over in his grave, I read you the list: “Regional office, Philadelphia Incumbent Title Race Re Fleming, G. James.| Regional dizec- | Colored.|$5, 600 or. Greenblatt, Mil- | Fai-practice | White...| 3, 800 dre examiner. Manly, Milo A...-- Colored. | 3, 800 Risk, Samuel R.. White...} 3, 800 Cl 74 Colored} 3, 200 ( fh eee ee ---d0-.2.. 1, 800 Klmeger, Karyl.--.-]----- do. wenn eenens White.__} 1,800 Brown, Giayce.....|.---- (<(. eee Colored-} 1, 440 “You will note that it is composed of eight individuals—five Negroes and three whites, Muldred Greenblatt, Samuel R. Risk, and Karyl Klinger. “Don’t you know there will be some broth- erly love when that crowd gets golng on the businessmen of the Philadelphia area? “REGIONAL OFFICE, WASHINGTON, D. C. “Now, here is the regional office in Wash- ington, D. C., the Nation’s Capital, where there has been so much persecution of white gentiles in the last few years. Here is the list: “Regional office, Washington, D. C. Incumbent Title Race Sal- ary Evans, Joseph...-.- Regional direc- | Colored. |$5, 600 Or, Houston, Theoph- | Fair-practiceex- |...do-... 8, 200 ilus. aminer, Kahn, 4" -- er ll... | White... 2,600 Chisoh bon... OC cian, Colored.| 1,800 DLL » Urback, Dorothy..-}.-. vido ed ae do.....| 1,620 “You will note it consists of four Negroes and Alice Kahn. Just what chance a white gentile will have with this group is entirely problematical, to say the least of it. “REGIONAL OFFICE, CLEVELAND “Now, let us move out where the West be- gins and take a look. Here is the list in the Cleveland regional office: “Regional office, Cleveland Incumbent Titlo Race ae McKnight, Wil- | Regional dirce- | Colored.|$4, 600 iam. Abbott, Oleott Rw. tor. Fair-practice ex. | White...| 3, 800 aminer. Glora, Teth® oe UO.nnnenn anne Colored.| 8, 200 Kelhy, Bern.za...., Clark-stenog- |-..d0.....{ 1,620 rapher. Wasom, Edna...-.-|.-.-. Onn ene nne White...) 1,800 “You will note that this group is com- posed of three Negroes and two whites, Olcott R. Abbott and Edna Wasem. “Don't you Know the white people of Cleve~ land will enjoy being dominated by them? “CINCINNATI REGIONAL OFFICE “Cincinnati seems to be largely under the jurisdiction of the Cleveland office since it only has two people: “Cineinnatt Incumbent Title Race Sale amos, Harold__....| Fair-practico ox- | White...|$4, 600 aminer, ween enwecnenneeceewne| Clork-stenogra-|....--.--.] 1,800 pher.
APPENDIX TO THE CONGRESSIONAL RECORD “DETROIT REGIONAL OFFICE “Now let us move on to Detroit, Mich. Here is the regional office for Detroit: “Detroit ; Sal- Incumbent Title Race ary Swan, Edward_....| Examiner in | Colored. |$4, 600 charge. Sese, Doris K_..-... Clerk-stenog- | Japa- | 1,620 rapher. nese- Amer- ican, “You will note that it is composed of one Negro and one Japanese, I know the busi- nessmen of Detroit are grateful for this con- sideration. “I should like to hear some of the com- ments they will make to you gentlemen from Detroit when you get home next summer, if you support this vicious measure. “REGIONAL OFFICE, CHICAGO “Here is the list of the regional office in the Windy City: . “Regional office, Chicago . Sal- Incumhent Title Race ary Henderson, Elner-- Regional diree- | Colored.|$5, 600 Gibson, Harry H. Palt-practice ex- ---do-_...| 3, 800 scvaliz, Joy... White___| 3, 800 Williams, Le - -| Colored.| 3, 200 Zeidman, Penny .. White_._| 1,800 Colored.| 1,620 Ingram, Margue- rite 8. “You will note it is composed of four Ne- groes, Joy Shultz, and Penny Zeidman. I am. told that a representative of this group went into the office of Swift & Co. and asked how many Negro members they had on their board of directors. The answer was, .“We have no Negro members on our board of directors.” Then the question came back, “Why haven’t you?” This just shows what this supergovernmental set-up is driving at. They want to communize America and de- stroy everything which our glorious ances- tors have left us and for which our boys are now fighting and dying all over the world. “REGIONAL OFFICE, ATLANTA “Here is a list of the Atlanta office: “Regional office, Atlanta Sal- Incumbent Title Race ary Dodge, Wither- | Rogional direc- | White...|$4, 600 spoon. Or. Hope, John_...-.-.. Fair-practice | Colored_| 3, 800 examiner, McKay, George D-..|...-- do..-..------ White...| 3, 200 Chubb, Sally....... Giark-stende: ---d0_-..- 2, 000 rapher. Ingram, Thelma_...|....-- do......-.---| Colored.| 1,800 “You will note that it consists of two Negroes and three whites; the most impor- tant post in this office, that of examiner, is held by a Negro. I wonder how the people of Georgia enjoy the domination of this I may have more to say about them “REGIONAL OFFICE, KANSAS CITY “Here is the list of the Kansas City office: “Regional office, Kansas City Title Sal- Race ary Incumbent . Hoglund, Roy A---| Regional direc- | White__.|$5, 600 tor. Ormabee, Eugene..| Fair-practice ex- |...do._-.. 8, 800 aminer. Jones, Mildred..... Olerk-stenog- Colored.| 1,620 rapher. : Schlien, Helene G..|.-..- do...--.....-| White} 1, 620 . Mazen, Jewel_,......-. “You will note that this office force consists of three whites and one Negro. You can read the list of whites yourself and then judge how many of them really represent the people of that area. “ST. LOUIS REGIONAL OFFICE “Here is the list of the regional office at St. Louis: “St. Louis Title Incumbent Theodore Brown...| Examiner in | Colored. /$3, 800 charge. Morris Levine-__... Examiner___--.- White.._} 3, 200 Armatha Jackson... Clerks stenog- Colored_} 1, 620 rapher. “You will notice that it consists of two Negroes and Morris Levine. Just how they came to select these particular individuals to preside over the destiny of the white businessmen of the great State of Missouri I cannot understand. “REGIONAL OFFICE, DALLAS, TEX. “The members of the regional office at Dallas are as follows: “Regional office, Dallas : Sal- Incumbent Title Race ary Castenada, Carlos..| Regional direc- | White._./$4, 600 tor. (Vacancy).....-.-.- Fair-practice |...-...-.. 3, 200 examiner. . Gutleben, Willetta.} Clerk-stenog- | White.__} 1,800 rapher, “You will note there is one vacancy. Last year that position was held by a Negro, namely, Roy V. Williams. The other two members, Carlos Castenada, the regional di- rector, and Willetta Gutleben seem to be in charge of the office at the present time. This is the regional office that attacked the Dal- las News last year for carrying an advertise- ment for a Negro janitor. This fellow Cas- tenada, the director, held the same position that he holds now. If this set-up is made permanent, then I presume the rest of the white American businessmen in Texas may expect to be harassed just as the Dallas News was, “REGIONAL OFFICE, NEW ORLEANS “The regional office at New Orleans con- sists of the following members: “Regional office, New Orleans ‘. Sal- Incumbent Title Race ary Ellinger, W. Don...| Regional] direc- | White__.|$3, 800 or. Morton, James H.. Pair: ir-prectice Colored.| 8, 200 Ronning, Evelyn... Cleri-stenogra- White...| 1,800 ph er. You will note that there are two whites and one Negro in this office. As the Negro is the fair-practice examiner, Just what the decent people of Louisiana may expect at the hands of this outfit is something to con- template. “REGIONAL OFFICE, SAN FRANCISCO “The San Francisco office consists of the following individuals: “Regional office, San Francisco Incumbent Title Race at Kingman, Harry L_| Regional direc- | White_..|$5, 600 tor. Rutledge, Edward... Fair- -practice|_..do.....| 4, 60C examiner. Ross, Bernard._.._.]--~.- Seymour, Virginia... Cee cera: ---0....-] 1,800 pher. Kainfalstiative Tr2do.-—| 2,000 , A3761 “This is the only office we have found yet that consists entirely of white (?) people. Just what the background of each one of them is I am unable to say. “LOS ANGELES REGIONAL OFFICE “The Los Angeles regional office consists of the following: “Los Angeles . Sal- Incumbent Title Race ary Hunt, A. Bruce....| Hearings exam- | White-._|$5, 600 iner. Brown, Robert E...| Fair-practiceex- | Colored.| 3, 600 aminer. Lopez, Ignacio......|-----do-.-_---.-.- White...| 3,800 Vetter, Vera G.w. Clerks Stenogra- |-..do..-.. 1,8 Lerna, Marie......-|-.--- an a do_...| 1,620 “You will note that there are four whites and one Negro in this office, the Negro being the fair-practice examiner. I do not know what consideration the white businessmen of the Los Angeles area are receiving at the hands of this group, but from what I can hear there is considerable gnashing of teeth over the situation. “Mr. Chairman, this FEPC is a supergovern= ment of commissars, with more power for evil than any other agency that has ever been created in this country. If Congress should ratify it and make it the law of the land, then we will have sacrificed and destroyed that sacred freedom for which our brave men are now fighting and dying on every battle front in the world. “We have no right to pass such a drastic, revolutionary measure that literally changes our way of life, as well as our form of govern- ment, while these boys are away from home in uniform fighting to sustain American institutions. “As I said before, we are going to carry this battle against such un-American activities into every congressional district in the United States mext year, in the primary, so that no one can crawl behind the party cloak and claim immunity at the hands of any seg= ment of our people. “This is a battle for the survival of free con- stitutional government, for the survival of the American way of life, for the survival of free enterprise, for the survival of American liberty itself, ‘It is a battle to save America for Americans.” Maritime Commission EXTENSION OF REMARKS’ HON. BARRATT OHARA OF ILLINOIS IN THE HOUSE OF REPRESENTATIVES Thursday, May 18, 1950 Mr. O’HARA of Illinois. Mr. Speaker, in including in my remarks the following editorial from the Washington Post of May 13, 1950, I wish to remind the House that my distinguished predecessor as Representative in this body from the Second District of Illinois, the Honorable Raymond S. McKeough, so admiringly and affectionately remembered by Mem- bers of seniority and who on the Mari- time Commission has rendered such out- standing service to the Nation, is not a member of Maritime Commission ma- jority. MARITIME REVOLT Advocates of all-out governmental sub-« sidies for the merchant marine have had tough going recently with both Congress and
“A3762 the administration. Perhaps the crowning blow was the endorsement yesterday by Sen- ator Macnuson of Reorganization Plan 21, which would abolish the Maritime Commis- sion and reconstitute its functions in the Department of Commerce. Senator Macnu- son, who 1s known as a friend of the mer- chant marine and is himself the author of a long-range shipping bill, gave as his reason the mounting criticism of and unsatisfac- tory relations with the Maritime Commis- sion. This criticism has been building to a cre- scendo. Last summer the Comptroller Gen- eral blasted the Maritime Commission for frregularities in granting overly large ship construction subsidies. His objections were upheld and amplified by the House Executive Expenditures Committee after protracted in- vestigation. The President himself showed concern over uncontrolled subsidies in his budget message. He translated this concern into action with Reorganization Plan 21. Now the Hardy subcommittee of the House Executive Expenditures Committee is ready- ing another report covering the entire sub- sidy operation of the Maritime Commission, both operating and construction, for fiscal 1949 and 1950. Indications are that this re- port will be even stronger than the last. _ That suspicion of shipping subsidies has _ permeated the House is shown by the ap- proval of the Thomas amendment to the om- nibus appropriations bill putting a ceiling on the operating subsidies that may be granted by the commission. Incidentally, the House also deserves credit for finally knocking out the amendment by Representative Harz Boaecs—which had been tentatively ap- proved—granting an unasked increase in funds for maritime training and reactivating two closed training stations. There is a reason for this rising hostility, and it is not that most Congressmen or ad- ministration officials are opposed to a strong merchant marine. It is simply that a large part of the shipping industry—which despite a@ recapture clause enjoys substantial subsi- dies and even more important tax advan- tages—-seems too anxious to shift more re- sponsibility to the Government and to get its hand further into the public till, and that the Maritime Commission majority seems only too eager to help. For example, there is no indication that the Commission has paid the slightest heed to criticism so far. In short, the confusion of the public interest with private interests is altogether reminis- cent of the atmosphere which led to the fa- mous Black report of 1935. Confidence will not be restored until there is a drastic shake- up and, more important, until Government aid to shipping is in the hands of men who are both disinterested and competent. Besieged by Terror EXTENSION OF REMARKS HON. THOMAS J. LANE OF MASSACHUSETTS IN THE HOUSE OF REPRESENTATIVES Thursday, May 18, 1950 Mr. LANE. Mr. Speaker, under leave to extend my remarks, I wish to include the following article from the Boston Sunday Post, Boston, Mass., May 14, 1950: WeE Cannot BE ComMPLACENT There is no reason to be complacent. Com- munism beaten back, driven underground or scattered to the four winds which blow around the globe, never gives up. The reason is that the Reds, casting rell- gion adrift, must yield to the inner compul- sion of the human heart to worship some- thing. If it isn’t God, then new gods must be made. Savages down the long centuries, with their absurd and preposterous idols, manufactured or observed in nature, prove it. So they genufiect to a political system and having doubts about it, since nowhere in all history has it had a semblance of success, they become fanatical like the whirling der= vishes or the holy rollers. That accounts for the endless pressure which the devotees of Marxism exert. It accounts for their ruthlessness to their en- eimies and to their own colleagues. It ac- counts for their willingness to le, cheat, deceive, and slay as they press on to impos- sible ends. There are signs, despite all the conquests made out of the chaos of the postwar years, when bewildered, war-weary people were willing to lean even on reeds, that they are losing the battle. Yet no one should be com- placent. For all their triumphs, the Reds have suf~ fered flascoes. They have lost west Ger~= many. The final straw was the announce- ment by Pravda that all German prisoners had been sent home. Germany, in angered grief, retorted that 1,500,000 Germans are still unaccounted for. The only conclusion can be that, taking - German-exagegerations-into account, at least hundreds of thousands of German prisoners were either slain in cold blood, allowed to . starve to death, or are imprisoned forever in slave labor camps beyond the Urals. In Italy was fiasco number two. The first shipment of American arms under the North Atlantic Pact stirred the Reds into action. They mobilized dock workers to stop the dis- embarking. They invoked strikes. Italy responded by calling up the police in battalions, holding the army in reserve and then, with the help of loyal dock workers, unloading the weapons and transporting them to a safe, guarded place. Reports out of Hungary of workers being recalcitrant and even threatening to strike, adds up. In China, Red tax collectors have been beaten off by half-nourished peasants and driven out of the mudwall towns to the security of the cities. A year ago, Communist might in France being so strong, the government would not have dared to announce a willingness to make an industrial pact in steel and coal wlth Germany. The same is true of Belgium. An election to decide what to do with the exiled King would not have been attempted. Allied anti-Russian propaganda is having its effect. Russia’s expressed willingness to hold elections in Berlin and settle the Trieste question, even though her terms were pre- posterous, demonstrates a recognition of the fact that she cannot bull her way through these problems. Yet we cannot afford to be complacent. Communism has nine lives. We must press on against the doctrine of heaven on earth jin a slave camp, by armament, enlighten- ment, and also by letting the Kremlin dig their own graves all over the world. Cil and New England EXTENSION OF REMARKS HON. JOHN W. HESELTON OF MASSACHUSETTS IN THE HOUSE OF REPRESENTATIVES Thursday, May 18, 1950 Mr. HESELTON. Mr. Speaker, un- der leave to extend my remarks in the RecorpD, I am including an editorial en- titled “Oil and New England” which appeared in the May 16 issue of the Bos- APPENDIX TO THE CONGRESSIONAL RECORD ton Herald. The proplem of the impact of imported oil upon our economy is not a simple one. I recognize that there are those who are sincerely concerned about the effect of imports in an unwise amount upon a healthy domestic pro- duction. Yet, as the editorial indicates, there are other considerations which must be given full weighi in terms of an over-all healthy economy. Om anp New ENGLAND The way high-tariff chickens come home to roost is well illustrated by the current controversy over oil imports. Because of a@ world surplus in oil production, prices have been dropping sharply and some do- mestic producers have been having trouble meeting the competition of foreign imports. Inevitably there has been a demand from the small and marginal producers for pro- tection in the form of quotas or tariff in- creases against imported oil. But the demand has stirred up strong op- position from a number of sources. The bulk of our present imports is from the over-~ seas production of American companies, and, since these companies are already meeting serious discrimination in foreign markets, they are naturally dead set against import bans at home. Domestic consumers have . also registered opposition to losing the price advantage they now enjoy 'on imported fuels for the sake of “protecting” home producers. And conservation interests, notably the mili- tary, have questioned the wisdom of cutting off imports of oil in peacetime and thereby reducing our over-all reserves against future emergency need. All of these practical and immediate argu- ments have backed up the State Depart- ment’s long-term opposition to steps which restrict imports and thereby cut down the ability of foreign countries to buy goods in our markets. It is gratifying that in this case New Eng- land has been quick to see what roost the chickens were headed for and has acted to meet the situation. At its last quarterly meeting the New England Council resolved to oppose “any measure designed to restrict or reduce oil imports into the United States” on the ground that it could only do harm to this “fuel deficit area.” Expressing satisfaction at the Council's alert action, a spokesman for the State De- partment’s petroleum policy staff last week wrote that among the many disadvantages of the proposed import restrictions might be noted “the probable increase in fuel costs for industrial and public-utility plants, particu- larly in areas like New England, increased fuel costs for ships, and the probable diver- sion of some ships’ bunker business to for- eign ports.” If the time actually comes when the do- mestic petroleum industry is threatened with extinction as a result of foreign competition, New England will join with other areas in authorizing legitimate protective measures. There is no doubt that the country has a great stake in the industry both as a pro- vider of jobs and as a defense instrument. But there is no very convincing evidence yet that it needs either quota or tariff protec- tion to get through its present troubles. We must go slowly in applying remedies which produce a dozen new problems for each one they solve. I also wish to include here the text of the resolution adopted by the executive committee of the New England Council at its meeting in Providence, R. I, on March 23. It reads as follows: Resolved, That approval by Congress of any measure designed to restrict or reduce oll imports into the United States will be contrary to the best interests of New Eng- and,
APPENDIX TO THE CONGRESSIONAL RECORD The London Conference—Double Feature EXTENSION OF REMARKS oF HON. HAROLD D. DONOHUE OF MASSACHUSETTS IN THE HOUSE OF REPRESENTATIVES Thursday, May 18, 1950 Mr. DONOHUE. Mr. Speaker, I should like to include a very timely and inter- esting editorial, entitled “The London Conference—Double Feature,” which ap- peared in the May 16, 1950, issue of the Christian Science Monitor. The article follows: Terr LonNpDON CONFERENCE—DOUBLE FEATURE The two big features at the Big Three meeting in London were the French pro- posal to unify the French and German coal and steel industries and the Big Three de~ cision to speed up the return of Germany as an equal member of western society. That was the order of their showing, but not necessarily of their significance. It is altogether probable that so clear a decision on Germany could not have been taken had it not been accompanied by a plan to give the French real hope of making Germany safe for world democracy. That is one of the main hopes in the coal-steel program as propounded by French Foreign Minister Robert Schuman. But while the direction in which the west now invites Germany to travel is plain enough, timetables have not been thrown away. Not all reliance for a correct German development within the western community is placed on the Schuman plan. The very facts of life preclude this, and it is only realistic of West Germany’s Chancelor Ade- nauer to accept them optimistically along with their implications. The chief of these facts is the present di- vision of Germany. That means an indefinite postponement of a German peace treaty and therefore a continuation of an occupied status for Germany, with consequent super- vision of the main streams of political de- velopment, though with increasing self-rule for the western Germans. The concessions which the Big Three felt able to make to the West German Republic in this situation should help Dr. Adenauer against his political opponents in western Germany as well-as help the west’s position generally against Communist propaganda. Another very big fact is the need of western Germany for defense against possible mili- tary aggression. The military implications in the continuance of a modified occupied status are that western Germany will be de- fended by the west against attack from the east. On this point, as on self-rule, Dr. Ade- nauer can claim a victory. The Schuman plan filled a diplomatic gap at London for Dr. Adenauer as well as for M. Schuman, for Dr. Adenauer had several times urged some such integration of indus- try. He can now point to this program as the reason why the French-German dispute about the Saar should become a secondary issue for Germans, The total of the achievement of London, as it is immediately visible, therefore, is to provide a strong base for gaining the offen- sive in the “cold” battle for Germany. The double isolation of western Germany—from eastern Germany on the one hand and from the western community on the other—may now he relieved, and the good wishes of the western nations for the democratic elements in western Germany made plain. * ‘This will still take some doing, to be sure, as will the decisive strengthening of democ- racy within Germany. The London meeting ‘has at the very least created an international atmosphere more favorable to these hopes than any that has existed since the war. Criticism of Public Officials EXTENSION OF REMARKS or HON. HAROLD H. VELDE OF ILLINOIS IN THE HOUSE OF REPRESENTATIVES Thursday, May 18, 1950 Mr. VELDE. Mr. Speaker, under leave to extend my remarks in the Rrcorp, I include the following editorial from the Peoria Star of May 15, 1950: ON CrRITICIZING PUBLIC OFFICIALS A plea by State Department Counselor George F. Kennan, in an address before the Institute on United States Foreign Policy, deserves some attention. “The Government may lose many of its best qualified people,” said Mr. Kennan, “if abuse and derision heaped upon officials grows much worse.” It is not difficult to understand why loyal and honest employees of the State Depart- ment find their situation disagreeable these days. None of them can entirely avoid some of the public suspicion which has fallen upon the Department and the work they do cannot be done best under present condi- tions. “The strains under which our leading Officials work,” said Mr. Kennan, “leave them a@ very slender margin of physical and spirit- ual energy to absorb abuse and derision from the people for whom they conceive them- selves to be working. I must tell you that the atmosphere of public life in Washington does not have to deteriorate much further to produce a situation in which very few of our more quiet and sensitive and gifted people will be able to continue in Government.” These officials, the loyal ones, deserve the sympathy of the people. But two questions are raised by Mr. Kennan’s address. First, who is to blame for the deterioration of the atmosphere of public life in Washington? And second, how can undesirable employees be removed from their jobs without creating the disturbances which embarrass good officials? It has been proven beyond the slightest doubt that espionage was carried on within the State Department with the cooperation of disloyal employees. These incidents opened the doors for speculation as to whether disloyal persons still held jobs in the Department. If it had not been for the Alger Hiss and the Amerasia incidents, for ex- ample, the charges of Senator McCartHy would not have received so much attention. The blame for the condition which fos- tered the atmosphere of suspicion must be placed upon those whose negligence per- mitted disloyal persons to hold jobs in the department. If it is argued that top officials cannot be blamed for a situation of which they were unaware, the reply is that top officials were notified and warned several times about Alger Hiss. Three times Presi- dent Roosevelt was appealed to in that case. He ignored each appeal, even laughing at one of them. And Dean Acheson quickly restored John S. Service to his State Depart- -ment job after Service had been arrested in the Amerasia case. The status of Service is yet to be determined, when the secrets of this incident are exposed, but it cannot be said that Mr. Acheson was unaware that Service’s loyalty might be questioned In the future. The theft of hundreds of secret State De- partment documents can be charged only to top level negligence. Such negligence led to public scandals which, in turn, led to further charges. Members of Congress could be charged with compounding that negli- gence if they allowed their suspicion of other disloyalties to remain unspoken, A3763 As to the second point, how are disloyal employees, if such hold jobs, to be removed without public charges, Senator McCarrHy has given an illuminating answer. He pre- ferred, he has said, to proceed quietly but learned that nothing could be accomplished that way. The people now know what ex- treme methods became necessary and how long it took to convict Alger Hiss. The people have also seen a demonstration of Official resistance to the current State De- partment probe. Even in the Senate Com- mittee assigned to the investigation there was powerful resistance. Washington of- ficialdom, therefore, must be blamed for the necessity for public accusations which make the lives of loyal Government officials miserable these days. Mr. Kennan is pointing the finger of blame at the wrong persons. The men who have sat in the White House and who have oc- cupied the office of Secretary of State are responsible for the deterioration of the at- mosphere of public life in Washington. Americans Against Communism EXTENSION OF REMARKS HON. ISIDORE DOLLINGER OF NEW YORE IN THE HOUSE OF REPRESENTATIVES Wednesday, May 10, 1950 Mr. DOLLINGER. Mr. Speaker, un- der leave to extend my remarks in the Recorp, I include the following article, written by Victor Lasky, feature writer for the New York World-Telegram. It appeared in the May issue of the Ameri- can Legion magazine: AMERICANS AGAINST COMMUNISM (By Victor Lasky) At Jong last the American people have awakened to the menace of communism and they're doing something about it. Sixty- six great American organizations, represent= ing about a hundred million people in every field of endeavor, have come together against a common enemy—world commu-~ nism. On assignment from my newspaper, I covered the birth of this great citizens’ move-~ ment last January. However, the story did not end with the close of this American Legion-sponsored All-American Conference, for since its inception the movement is hav- ing an amazing growth. And so powerful is its potential for the good of this Nation that the Communists and their dupes, both know~ ing and unknowing, are moving heaven and earth in an all-out attempt to smash what grew out of the 3-day conference. I watched the Communist and non-Com- munist press coverage of the event. At first I was amused, then disgusted, For in their frantic efforts to smash the new all-Ameri- can movement the Communists are resort- ing to their typical lies, deceptions and dis- tortions of what took place, in an effort to put class against class, faith against faith, and organization against organization. Typical headlines in such papers read: “Labor sits down with labor-baiters,” “B’nai B'rith sits down with Jew-haters,” and “Veter- ans united with those who would curtail their privileges.” Understandably hysteri- cal, too, was the Soviet radio commentator Zaslavsky, who on February 4 screamed from Moscow: “The assembly in New York con- sidered itself to be a step toward the forma- tion of a Fascist Party in America. The speeches were Fascist, they shouted like the Nazis. The entire set-up was borrowed from Hitler and was a mixture of pogrom-mon- gering and self-induced hysteria.”
A3764 What actually took place? Leaders of the great labor, business, industrial, fraternal and religious groups got together to discuss a@ common problem—how to combat com- munism. It was agreed by the participants that many of the organizations normally have conflicting interests, but all the groups were willing to unite in the fight against those who would destroy the liberties of all Americans. The speakers represented labor and capital as well as government and religion. All were in agreement that communism was seeking to undermine everything this Nation has stood for in the world since our Constitution was drafted. The delegate then passed a historic res- olution calling upon all loyal Americans to join the battle against “the steady infiltra~ tion of communism into our schools and colleges, into our press, radio and screen, into our labor and business and into our Gov- ernment itself (constituting) an immediate, serious and growing menace to the very exist- ence of the America that we know and love.” A continuations committee composed of a cross section of the participating groups was empowered ‘“‘to act as a clearinghouse and information center through which the var- ious organizations may be informed and ad- vised of the activities and experiences of other organizations, all upon the under- standing that such committee shall recog- nize the full independence of the various organizations and shall not attempt to con- trol or supervise them.” High above Times Square, where the All- American Conference took place, I had a chance to talk to some of the men and wo- men who passed this resolution. No matter from where they hailed, they were concerned over the extent of subversion in their re- spective communities. And they’ve been do- ing a lot of hard thinking. They know that mere hatred of communism is not enough. Too often, they realize, unchanneled anti- Communist feeling and action play right into the hands of would-be martyrs of the Paul Robeson stripe. Somehow such emotional reactions must be transmuted into an effec- tive plan of action—action that will meet community needs in a positive, rather than negative manner. Basically, the people I talked to agreed that a plan was needed to make Americans in Maine, New York, California and Alabama enthusiastic about the American way of life. That resounding phrase may be an abstrac- tion, but it was once used with deep mean- ing by generations of Americans who taught their children to revere its tenets and, on unhappy occasions, to shed their blood in its defense. The phrase can’t be defined easily; but, in essence, it means democratic living in a free society under the protection of the laws of the land. No swashbuckling dictators to tell you what to do. Yet, in recent years, too many Americans have become confused, uncertain and hesitant in defending their heritage against the wiles of the Commu- nists and fellow travelers. How these insidious intellectual con-men set up innocent sounding crganizations as traps for every section of the population was fully described by the distinguished speak- ers at the All-American Conference. They told how the Reds, seeking a shield of re- spectability by associating themselves with decent causes, bore from within established political, labor and social organizations. FBI Chief J. Edgar Hoover recently estimated there were more than a half-million Com-~ munists and fellow travelers in the country. You'll find their spokesmen on the air, the public platform and in the press. You'll even find them running nursery schools, rep- resented on school boards and in parent- teacher associations and officiating at lodge meetings, It takes only one dedicated Stalin- ist to spread poison and cause dissension in any neighborhood or group. He's the eager merchant peddling easy answers to all prab- lems, and he’s always looking for dupes who unwittingly will advance the Kremlin cause. Tireless, resourceful, crafty and dedicated to the godless ideals of Marxism-Leninism- Stalinism, the Communists are a tough crowd to buck. However, with a united front to oppose them at the grass-roots level they can be defeated. Those present at the All-American Confer- erce had no qualins about the future. There wasn't any question in their minds about making a clean sweep of the commies; the primary problem was that of the approach to be used. I spoke to one man representing a large fraternal organization who said he felt that voting was one of the first problems which would have to be tackled by the conference, Pointing out how lightly Americans take this vital right and privilege, he reminded me that during the 1948 Presidential election al~ most half of those eligible to vote had failed to cast their ballots. At the same time, he said, the commies worked day and night to pile up the vote for their favorite, Henry A. Wallace, and spent an estimated $3,500,000 in their aitempt to put Wallace in the White House. As the delegates were told by Dr. Francis L. Bacon, professor of the college of educa- tion of the University of California at Los Angeles, most Americans have got to learn— or be taught anew—the basic facts about our democracy. They must realize how the indi- vidual citizen can literally move govern- ments. The machinery of our Government is poised purposefully so that the tiny but insistent pressure of a single citizen can be felt not only in city hall but in the White House. You can be assured that a letter to the mayor, and even to the President of the United States, will receive attention. How well the subversives know these elemental facts, Another important job will have to be done in our school system. This is a ticklish job since Communist teachers, who make no bones about hating America and loving Rus- sia, have managed to penetrate our schools. The intellectual balderdash of Marxism, un- fortunately, appeals to or confuses many educators. That Communists have no place in the school system has been stated by the educa- tional policies commission of the National Education Association. But whenever action against them is taken there are high-pitched screams that academic freedom and free speech are being impaired. In many cases these come from Americans who should know better. This argument recently was an- swered by Dr. Earl J. McGrath, United States Commissioner of Education. In a major statement of policy, Dr. McGrath asserted: “Children are not sent to school to be indoctrinated with a closed system of phi- losophy or the political views of the teacher. The Communist embraces and teaches dogma. He is, by his party membership and sympathy, committed to a closed system of thought. “He jis not free to serve the truth as evi- dence may uncover the truth. He has, therefore, surrendered his right to teach in a@ nation of free people. Communist influ- ence, if 1t began to find expression in our schools and colleges, would be inimical to the development of the minds and charac- ters of American youth, on whom the future depends.” But the anti-Communist movement must steer clear of those who, in the name of Americanism, would put shackles on our schools, Dr. McGrath warned. “Our efforts to avoid one danger,” Dr. McGrath said, “must not betray us into APPENDIX TO THE CONGRESSIONAL RECORD adopting measures of censorship and con- trol, Which are the essence of the police state, Some persons have the unfortunate tendency to label as communistic every idea which they happen to dislike. This form of in- timidation through vilification is just as objectionable and just as stultifying as the closed-mindedness of the Communist.” The Communists have long viewed the schools as their best recruiting grounds. For decades they have sent “organizers” into the high schools and colleges to spread the Marxist gospel. But the delegates I spoke to recognized that driving the Commies out of the schools is not enough. Too many Americans, they pointed out, are unable to defend their heritage with. facts and intelligent interest. One possible reason has been suggested by Benjamin Fine, education editor of the New York Times. His investigations indi- cate that the study of American history in American schools has fallen off considerably. His ideas were amplified by an educator I met at the conference who told me em-~ phatically that parent-teacher groups should wake up. Schools, he said, should and will teach what parents think is vital in educa- tion. Your board of education needs you to tell it what to do. If parents are active, well-informed and interested in democracy, the board will respond to their needs. Other- wise it will be sheer luck if you get good schools. There should be more scholarships, this man continued, for students to study the glories of America’s past. Books outlining the virtues of the American way should be subsidized. They should be as readable as books decrying the American way, many of which manage to reach best-seller propor- tions. Essay contests on such subjects as Our Community’s Place in the Story of the Nation’s Freedom should be encouraged. The winning essays, he concluded, should be published in the local newspapers. As a@ newspaperman, I’d like to amplify that last point. Your newspaper editor will be glad to cooperate. He’s not the cigar- chewing tyrant the movies make him out to be. He’s got a stake in the American way, too. The American press is the freest in the world and your editor wants to keep it that way. He'll play ball. And don’t overlook the importance of radio in your community. A powerful blow against communism can be struck by broad- casts of recordings prepared by the Office of Education in Washington: Such scripts as American Heritage, Democracy in Action, The Bill of Rights, Americans All—Immi- grants All, are available for the asking. Forums in which pro-American spokesmen can thresh out local problems are certain lo prove popular. Pressure should also be exerted at the com- munity level for the production of motion pictures which dramatize American history. Such films can do much jn inspiring Ameri- can youth, and yet too few have been made. This is curious, too, since good historical mo- tion pictures such as Cimarron, Gone With the Wind, Drums Along the Mohawk, and Northwest Passage have made millions for their producers. More such films are needed instead of the stuff that Hollywood grinds out, and also needed are more short features dealing with our country, its history, its peo< ple, and its traditions. Too many films deal with America’s im- perfections. The Grapes of Wrath type of Hollywood product does accurately reflect a phase of American development, but it was, after all, a minor one. Small wonder that the Russians love to show films like the Grapes of Wrath to their people as an indica. tion of what American life is like. Not that America is perfect. But modern man has reluctantly come to the realization
APPENDIX TO THE CONGRESSIONAL RECORD that absolute perfection of any kind is im- possible. Americans, however—unlike the Russians—freely admit their imperfections and have never made any secret of them. It is obvious that the time has now come when the emphasis has to be placed not on what is wrong with this country but what is right with it. And that is the job ahead for the Ameri- cans who are lining up in the fight against communism. There can be nothing passive about it. As more than one of the speak- ers said: “This fight cannot be won by adopt- ing resolutions and letting it go at that.’ From what I observed, and from the temper of those present, it is not going to end with resolutions adopted in committee rooms. This battle is going to be fought, and won, in thousands upon thousands of American communities. And the commies are going to be licked at the grass-roots level by such men as Big Jim Levinson, whose story was told to me by one of the delegates to the All-American Conference. Big Jim Levinson is the head of the Levin. son Steel Co. in Pittsburgh. This is a small company compared with the giants of the industry, but few of its 170 mill hands would eare to work anywhere else. Big Jim came to America as an immigrant boy. He soon developed a passionate love for his adopted land. Equality of opportunity more than anything else impressed him. Where else could an immigrant boy, through hard work, rise as quickly in the community as he had? So it was not surprising that Big Jim never asked a man his race or nationality when he hired him. All he was interested in was, would he make a good worker? And not only was Big Jim the easiest boss in the world to talk to, but he was always looking out for their interests—whether they were in the shop or community. Big Jim always tried to transmit his own zeal for Americanism to his employees through posters, bulletin board announcements, and a house publication, He was always stressing the responsibility of every American to vote, to perform jury duty, and to take an active part in community affairs. When his son, S. M. Levinson, took over as president of the company, the same labor- management relations continued. So that when the trade magazine, Printer’s Ink, and the American Heritage Foundation jointly sponsored a contest in industry the Levinson employees were among the first to partici- pate. They had had good training from Big Jim Levinson. And they put that training into use. They launched community clean-up campaigns, organized children’s ball teams, aided the Community Chest, the March of Dimes, and other civic ventures. They distributed the posters in behalf of religious tolerance, en~ couraging voting in primaries and promoting, a score of other worth-while causes such as plood banks, CARE packages, and chest X-rays for detecting tuberculosis. Yes, the Levinson employees took first prize in the American Heritage contest and Big Jim’s son, in announcing the great honor which had come to them, told his employees: “Tf your interest in your American heritage ends with this program, our efforts will have been in vain. This country and its stand for ‘life, liberty and the pursuit of happiness’ didn’t just happen. It took sweat, blood, and intestinal fortitude. They gave us a heritage which you and your children must protect and foster.” In Big Jim Levinson’s words, that is what the All-American Conference is all about. It’s a job that the delegates can start, but which all loyal Americans—the Americans against communism—will have to work at from this time forth, every day in every year. What Is the Future of the Steam Locomo- tive With the Advent of Diesel Power? EXTENSION OF REMARKS HON. JAMES E. VAN ZANDT OF PENNSYLVANIA IN THE HOUSE OF REPRESENTATIVES Thursday, May 18, 1950 Mr. VAN ZANDT. Mr. Speaker, with the advent of the Diesel engine much discussion is taking place regarding the future of the steam locomotive in its relationship to the coal industry. Recently I accepted an invitation from a group of B. & O. Railroad employees to address B. & O. Night on May 17 at Du Bois, Pa. I took the occasion as an opportunity to discuss the future of the steam loco- motive and the competition it is receiv- ing from Diesel power. My address follows: ADDRESS BY REPRESENTATIVE JAMES E. VAN ZANDT, MEMBER OF CONGRESS, TWENTY-SEC« OND CONGRESSIONAL DISTRICT OF PENNSYL-= VANIA, AT BALTIMORE & OHIO NicHT, HELD oO Batztroom, Du Bois, Pa., May 17, Mr. Chairman, ladies, and gentlemen, com- ing here tonight as your Representative in Congress, I am also appearing before you as a fellow railroader and one who is deeply con- cerned over the future of the railroad indus- try in America. My railroad experience began in July 1916, when I entered the employ of the Pennsyl- vania Railroad as an apprentice boy in the Altoona shops. After having served in vari- ous departments of the Pennsylvania Rajil- road I held the position of district passenger agent when elected to Congress in 1938. In accepting the invitation to address you, I did so because I always feel at home with a railroader and his family. This is true be- cause we speak the same language, even though you represent the B. & O. and my railroad employment has been with the Pennsylvania system. I would like to talk to you this evening about the future of the railroads in America as it applies to the use of coal as a source of power, and the substitution of the Diesel engine’ for steam locomotives. I have selected this subject because of the great importance of coal and steam locomo- tives to not only Du Bois, but to other rail- road communities in this congressional dis- trict. I am sure you will agree that when the miners dig coal and railroaders have jobs, it means a healthy economy for our area in Pennsylvania. While other sources of power continue to make inroads upon the use of coal it is im- portant to remember that coal still is our largest single source of fuel and power. In 1948 production of bituminous coal in this country was 600,000,000 tons, and we produced more than 57,000,000 tons of an- thracite coal. In 1949, of course, production of both bituminous and anthracite was much lower. Of the total production of bituminous coal in 1948, railroads purchased almost exactly one-sixth. Their total purchases somewhat exceeded 102,000,000 tons, a figure you should keep in mind, to have a correct idea as to the fuel and power situation on the railroads. The Diesel locomotive has advantages which railroads cannot afford to overlook, Then, too, there have been notable increases in recent years in the use of Diesel power on the railroads. A3765 The fact remains, however, at the begin- ning of 1950 the railroads still owned 28,800 steam locomotives, compared with approxi- mately 7,500 Diesel locomotives. With growing pressure of competition, the railroads are obliged to take advantage of every opportunity for increased economy and efficiency, and in some situations the Diesel is of advantage to them. However, not all of the advantages in the field of locomotive power are with the Diesel, One important fact is that a Diesel locomo- tive costs considerably more than a steam locomotive of equivalent power. In order to overcome this higher cost, the Diesel must be intensively operated, so that the higher initial cost can be spread over 4 greater road mileage or greater number of switching hours than the steam locomotive, thereby equalizing the unit cost. However, we all know that the situations where locomotives can be thus intensively utilized are not unlimited on the railroads; there are a good many runs and yards where it just is not possible to have around-the- clock operation of a locomotive. For this reason, the idea that steam loco- motives are due to disappear from the rail~ roads in the next few years may be too pessimistic. Moreover, it is the natural thing that steam would be first replaced by Diesel power on those runs where the opportunity for intensive utilization is most advantageous to the Diesel. Thus, such replacements tend to take place in a descending order of relative com~< parison, so that as time goes on the situa- tion tends toward stabilization. That is, the Diesels have found their place in. those fields where the utilization factor favors them, and the steam locomotive re- tains its place where situations in turn favor it. Nor should it be supposed that the death knell has been sounded for coal as a source of fuel on the railroads and nothing is being done to delay or halt the funeral. In point of fact, quite the contrary is the case. Perhaps under the spur of competition from the Diesel, a great deal of work is being done to improve the efficiency and perform- ance of the coal-burning steam locomo~ tive and to develop new types of locomotives using coal as fuel. . It has already been found, for example, that a coal-burning steam locomotive of modern, efficient design, with good upkeep and servicing, can closely rival the Diesel for percentage of available miles run per month. Let it not be forgotten that the railroads still have a good-sized investment in steam locomotives, and they are not going to sacri- fice any part of this investment unneces- sarily. The railroads also are actively at work on the development of new types of steam loco- motives which will develop greater efficiency in extracting power from coal and delivering it at the drawbar. One of the great advantages of the Diesel is that it is about four times as efficient as the conventional reciprocating-piston type of steam locomotive in delivering power relative to fuel consumed. New designs of locomotives are being tried in an effort to narrow or overcome this handicap. Such new designs include steam- turbine and gas-turbine locomotives, to burn coal. The steam-turbine locomotive differs from the reciprocating-piston type in that the steam under pressure is directed against blades of a turbine wheel, instead of against pistons operating in cylinders. Steam-turbine locomotives thus far have been of two types, direct-geared and turbo electric. In the first of these types, the turbine is mechanically geared direct to the driving
A3766 wheels. In the turbo-electric type, the tur- bine drives electric generators, which in turn drive motors which are geared to the wheels. The first American direct-geared steam- turbine locomotive was placed in service in 1944. It developed 6,900 horsepower, and new designs of this type are expected to de- liver up to 9,000 horsepower, The first steam turbo-electric locomotive was placed in service in 1948, It 1s designed for high-speed passenger service and depends on a 6,000-horsepower turbine which delivers a total of 4,960 horsepower to the eight driv- ing axles. Much research and experimentation also have been devoted to the development of a coal-burning gas-turbine type of locomotive. In this type, combustion gases power the turbine directly instead of being used to convert water into steam. Thus, coal is used to power an internal-combustion en- gine somewhat similarly to the manner in which gasoline powers an automobile engine. A group of nine railroads is cooperating with five coal companies in the development of the gas-turbine locomotive. The railroads concerned are the Baltimore & Ohio, Chesapeake & Chio, Illinois Central, Louisville & Nashville, New York Central, Norfolk & Western, Pennsylvania, Virginian, and the New York, Chicago, & St. Louis. The coal companies are the M. A. Hanna Co., Island Creek Coal Co., Pocahontas Fuel Co., Pittsburgh Consolidation Coal Co., and the Sinclair Coal Co. President Roy B, White, of the Baltimore & Ohio Railroad, has been chairman of the locomotive development committee since its formation in 1944. The incentive for the development of these new types of locomotives is that bitu- minous coal continues to be the cheapest locomotive fuel. Since 1945, the cost of coal per million B. t. u. (British thermal unit) has risen from 12 cents to approximately 18 cents, while the cost of Diesel fuel has climbed from 50 cents to 69 cents per million B. t. u. However, the cost of fuel required to pull a train depends as much upon the efficiency of the locomotive in extracting power from the fuel and delivering it at the drawbar, as upon the price of the fuel. As we have just seen, the steam locomotive is much less efficient than the Diesel in this respect. However, the gas turbine, because of its ability to use low-cost fuels with good efficiency, bids fair to be a strong competitor of the Diesel-electric locomotive for road service. Except when idling, the coal-burning gas- turbine locomotive is expected to cost much less to operate than any of its competitors. In road service where the average load is 60 to 75 percent of full power, the coal- burning turbine should save $12 to $15 per hour under the Diesel’s fuel cost, or any an- nual saving based on present fuel prices of $50,000 per locomotive can be expected. This saving is the key to the interest displayed in the development of the coal- burning gas turbine. In the development of this locomotive, many technical problems of great difficulty have been encountered. One has been the pulverization of the coal to the extreme fineness required and its de- livery to the combustion chamber. Another has been the question of fly ash left after combustion—its disposition and its possible corrosive effect upon turbine blades. The third has to do with the extremely high temperatures of operation. However, tests have shown that pulverized coal can be fed continuously to a combustion cham- ber and burned efficiently under a pressure of 60 pounds per square inch. One of the advantages of the gas-turbine locomotive is that its power plant is ex- tremely light and compact in comparison with the locomotive-type Diesel engine. The 2,009 horsepower power plant now on test is only 2614 feet long, 314 feet wide, and 6 feet high. Two such units might be placed side by side in a locomotive, with a center aisle, permitting 4,000 horsepower of prime-mover capacity in approximately 26 feet of loco- motive car length. This power plant weighs less than half as much per horsepower as the locomotive- type Diesel engine. Another interesting fact is that the gas- turbine locomotive develops considerably more power in cold weather than in hot weather, because cold air 1s of greater density. A gas turbine that develops 2,0C0 horse- power when the air is 80° (F.) develops 2,600 horsepower when the temperature talls to 10° above zero. This characteristic makes the gas-turbine type of locomouive especially suitable for cperation in cold climates. These activities in the development of new types of coal-burning locomotives show that the railroads are doing their part to help coal retain its place as a source of fuel and power. In this matter they have a stake of no small value. In 1948 the class I railroads of the country hauled a total of about 8,700,000 carloads of coal (anthracite and bituminous), amount- ing to more than 500,000,000 tons. From this coal traffic the railroads derived @ revenue of more than $1,300,000,000, and because of the value of this traffic, they are putting their full weight behind measures to protect it. In these activities of the railroads they deserve and ought to have—as I am sure they do have—the hearty cooperation of the coal producers. These measures to protect the railroad in- dustry include opposition to the construc- tion of the proposed St. Lawrence seaway, which has been more aptly described as the St. Lawrence “‘iceway.” This project is estimated to cost this coun- try, in addition to what has already been spent, anywhere from $573,000,000 to $1,049,- 000,000, depending on the depths of the channel. These are estimates by the Corps of Engi- neers of the United States Army, and in the past their estimates have always proved to be subject to considerable increase when the bills came to be paid. Among the important items of traffic which would be handled by the St. Lawrence sea- way is foreign coal. One student of the subject has estimated that if this project should be completed an immediate annual loss of from ten to seven- teon million tons of coal exported to Canada can be expected. Moreover, this loss wou'd be exclusive of the actual coal imports into this country through the waterway, and also exclusive of the replacement of steam power by water power over a considerable area. These losses ‘would not only injure the coal industry but would bring with it the displacement of workers in the coal industry and on the railroads which carry the coal, and, as I mentioned, who purchased more than 100,000,000 tons of coal in 1948, The interest of all coal producers in co- operating to help prevent this lavish waste of tax money to take away the livelihood of many of the taxpayers ought to be fully apparent, Another step in which producers of coal ought to be glad to cooperate is in helping to improve the situation with respect to the abuse of the highways by huge freight trucks, in competition with the railroads. This is another case in which the coal producers have a two-fold interest——as tax- payers and as beneficiaries from the use of coal by railroads. Let it be understood at once, that there is no objection on the part of any fair-minded APPENDIX TO THE CONGRESSIONAL RECORD person to the use of the highways, and the terms on which they are used by farm trucks, city pick-up and transfer trucks, and the usual run of light trucks. The only objections against the huge road- busters, which are estimated to comprise only about 5 percent of all the trucks on the highways, is that they are responsible, according to many authorities, including Governor Duff, of Pennsylvania, for major deterioration and damage of the highways. It is only pointing out the truth—to sug- gest—that the taxpayers of the country— and that means just about all of us—have an important pocketbook interest in putting an end to this sort of damage. Moreover, studies in several States have shown that in relation to the use they make of the highways, and the strains they im- pose on it, these roadbuster freighters pay less in taxes for highway purposes than the owner of a passenger automobile pays. Moreover, truckers are constantly trying to have maximum load limits increased—so that they can impose even heavier loads on the highways—and do even greater damage to them. Here in Pennsylvania, they are especially active in that direction, although Pennsyl- vania’s maximum limit of 45,000 tons for tractor-semi-trailer combinations would ap- pear to be liberal. And even with this liberal weight allow- ance, there is constant chiseling by truckers to evade the law by overloads above the legal limit. You can all recall the controversies with truckers on the Pennsylvania Turnpike in regard to these overloads. In fact, at times their activities have practically amounted to defiance of the law, if not open revolt. Aside from their damage to the highways, these big froighters also are the focus of the problem of diversion of freight traffic from rallroads to highways. Statistics show that while these big highway freighters amount to only 5.2 percent of all trucks registered, they operated 29 percent of all truck-miles on main rural highways and carried 72 per- cent of all highway freight ton-miles in 1948. As I have already said, railroads in 1948 used 102,000,000 tons of coal, or one-sixth of the total production. The trucking industry uses no coal. In the light of these figures, the interest of coal producers in helping to keep coal on the rails would appear to be obvious. In my opinion, it behooves the American people, and especially those of us who be- long to the great railroad family of America, to lend our assistance, to the railroad in- dustry in its fight for what appears to be its very existence. Those of you who are here tonight as em- ployees of the B. & O. Railroad are to be highly commended for your keen interest in railroad problems. I know you will continue this fine spirit of cooperation, which is so essential if the ef- forts to stabilize the railroad industry and safeguard the jobs of its employees are to prove successful. How Far Should Government Control Go in Advertising? EXTENSION OF REMARKS OF HON. THOMAS J. LANE OF MASSACHUSEITS IN THE HOUSE OF REPRESENTATIVES Thursday, May 18, 1950 Mr. LANE. Mr. Speaker, under leave to extend my remarks, I wish to include
APPENDIX TO THE CONGRESSIONAL RECORD the following address of Mr. Daniel J. Murphy, Chief of Trial Division, Federal Trade Commission, before the Golden Jubilee Advertising Convention, School of Commerce, Accounts, and Finance, New York University, May 12, 1950, at the Park Sheraton Hotel, New York, N, Y.: How Far SHOULD GOVERNMENT CONTROL GO - In ADVERTISING? May I, at the outset, refer to a definition of terms, “Government control.” What do we mean by that expression? It appears to have rather sinister implications—to some it may suggest state socialism—in some new, real, or imaginary, form—to others, it may imply some new kind of governmental interference with the lives and affairs of its people. The word “control” may mean to govern, direct, rule, subdue. Surely the Government has not in the past and has no desire in the future to so “control” advertising. It only seeks to prevent or to lessen that advertising which is false and misleading. And in mak- ing this attempt the individual whose adver-~ tising practices and representations are questioned is afforded every guaranty of his constitutional rights and protection. Thus may I suggest that here we are dis- cussing governmental “regulation” of adver= tising rather than controls, and that the question should really be, ‘Should the Gov- ernment go any further in the regulation of advertising?” Before answering this ques-= tion, we should first examine a little histor- ical background. The Federal Trade Com- mission is the only governmental agency equipped by statute, procedure, organization, and purpose, to protect the consumer and competitor from false and misleading adver- tising. Thus the Government acts through the Federal Trade Commission in attempting to regulate advertising in conformity with established law. Prior to the establishment of the Federal ‘Trade Commission, there was no such regula- tion of advertising. The prevailing practice was “Let the buyer beware.” For example, in 1900, the United States Circuit Court of Appeals for the Sixth Circuit: refused to grant injunctive relief to a manufacturer of aluminum-faced washboards in restraining a competitor from using the word “alumi- num” on boards which contained no alumi- num, saying that “if * “* * all persons (are) compelled to deal solely in goods which are exactly what they are represented to be, the remedy must come from the legislature and not the courts.” Following this decision there was a growing demand for legislation against untruthful advertising. Expressions of this demand were voiced increasingly in newspapers and trade journals. A few such expressions are as follows: In 1904, the Atlantic Monthly magazine re- ported “Swindling in newspaper advertising * * * has grown to be a public menace.” ? In 1905, editorials appeared in the Ladies Home Journal (by Edward Bok) dealing with patent medicine advertising and the danger- ous character of some medicines, and the methods used to convince people that they had ailments for which the medicine was recommended as a cure? In 1914, an article in Inland Printer maga- zine, entitled “Death Knell of Untruthful Advertising,” said, in part, “A wave of re- form is now sweeping the country—with the purpose of sweeping it of all dishonest ad- vertising.” « 1American Washboard Company v. Sagi naw Manufacturing Company (103 Fed. 281, 285 (C. C. A. 6)). 7 August 1904 Atlantic Monthly magazine. *March and April 1905 Ladies Home Jour- nal. ‘March 1914 issue of Inland Printer. In 1914, the Federal Trade Commission Act was passed. Congress, in enacting the Fed- eral Trade Commission Act, wrote into its section 5 the prohibition against all unfair methods of competition in commerce, stat- ing in its Senate and House reports that it was not practical or possible to define all such methods and that if it did, new ones would continually arise. It left to the Com- mission for its determination what practices were unfair. The Commission was organized March 16, 1915, and on November 23 of that year the Association of Advertising Clubs of the World, at a hearing before the Commission, urged it to take steps toward suppressing untrue advertising as a form of unfair com- petition. The first two formal cases decided by the Commission involved false advertis- ing. The first Commission case to reach the Courts involved the false advertising of foods The Court in that case said: “The Commissioners * * * are to * * * stop all those trade practices that have a capacity or tendency to injure com- petitors directly, or through deception of purchasers, quite irrespective of whether the specific practices in question have been denounced in common law cases.” The Commission has proceeded over the years to establish literally hundreds of new landmarks in the field of unfair competition for industry guidance and consumer protec- tion, through the courts, until its right to proceed for consumer protection alone with- out proof of substantial injury to competi- tion was threatened by the Raladam deci- sion.? The Supreme Court held in that case that false advertising must be shown by proof to threaten to injure or to injure present or potential competition. This was remedied by the enactment of the Wheeler-Lea amendment in 1938, which did away with the requirement of the proof of injury to competition by making unlawful unfair or deceptive acts or practices. Thus the consuming public who might be deceived by false advertising was made of equal con-~ cern, before the law, with the merchant or manufacturer injured by the unfair meth-~ ods of dishonest competitors. A comparison of the present standards of advertising and business ethics with those prevailing prior to the enactment of the Fed- eral Trade Commission Act clearly demon- strates a remarkable progress. It seems al« most incredible that the high concept of re- sponsibility on the part of business to the consuming public and to competitors as now exists were possible of achievement, As a distinguished professor of law in a neighboring university in New York (Milton Handler, Associate Professor of Law at Co- lumbia University, New York), in appraising the work of the Commission in the field of false advertising, said (1929): “The Trade Commission has performed yeoman service, and, while it has attempted to stem a seeming Niagara, with proper judi- cial support additional prodigies are not be- yond possibility.” ® And after passage of the Wheeler-Lee amendment: “The condemnation of false advertising constitutes one of the signal achievements of the Commission * * *,” “Despite the magnitude of the task, the Commission has made considerable progress in the elimination of false and misleading advertising. The fact that much still re- SFTC v. Gircle Cilk Co. (1 FTC Dec. 13); FTC v. A. Theo Abbot & Co., (1 FTC Dec. 16). 6 Sears, Roebuck & Co., v. FTC (258 Fed. 807, 311 (C. C. A. 7, 1919) ). ™FTC v. Raladam Co. (283 U.S. 648 (1981)). #39 Yale Law Journal 44 (1929), A3767 mains to be done does not detract from the importance of its achievement.” ® And: “The most fruitful as well as the most voluminous work of the Commission has been in this field.7¢ The Courts have also been generous in their praise of this phase of the Commission’s work and have noted that the Commission is peculiarly adapted to do it. Chief Justice Stone expressed this idea in these words, speaking of the Commission: “It was created with the avowed purpose of lodging the administrative functions com- mitted to it in a body specially competent to deal with them by reason of information, ex- perience, and careful study of the business and economic conditions of the industry affected ™ In the Commission’s work directed toward the stopping of false advertising or prevent- ing its use, it follows three well-defined courses of procedure. One might somewhat descriptively refer to them as the consent method, the compulsory method, and the cooperative method. The consent method may be used when the offender desires to agree voluntarily to discontinue the representations complained of, and to enter into an agreement, called a stipulation, to cease and desist from using them any more. When this procedure is initiated, the Commission’s attorneys who prepare these agreements have before them the information which has been gathered by investigations of one sort or another. Since there is always the possibility that some of this may be incorrect or has been rendered out of date by advances in scientific knowl- edge, the advertiser is given the opportunity to come and discuss the matter with one of the attorneys of the Bureau of Stipulations and present his side of the matter. The pro- cedure is quite informal, and if the adver- tiser can satisfactorily justify the repre- sentations he has made, he will be out of the woods. If he cannot do so, he may, if he elects, agree to cease and desist from their further use. If he continues to as- sert that his advertisements are not false, and the Commission is of the opinion that they are, the issuance of a complaint follows the compulsory method. This opportunity to dispose of a matter by stipulation is not a matter of right, but a privilege extended by the Commission. It is the policy of the Commission to extend it only in cases where it is of the opinion that under all the circumstances, such a disposition will effect a prompt correction and fully protect and satisfy the public in- terest. It is not extended when the Com- mission is of the opinion that the adver~ tiser has undertaken to perpetrate a delib- erate fraud or when danger from the use of the product is to be anticipated. If the opportunity to stipulate is not given by the Commission, or if it is offered and refused, a complaint is issued. The law provides that the Commission shall issue and serve complaints whenever it shall have reason to believe that false adver-= tising has been disseminated and that a pro- ceeding in respect thereof would be in the public interest. Of course, the Commission would have reason to believe both of these things before the opportunity to stipulate was extended. The complaint states the charges against the advertiser, whom we call the respondent, and is served upon him. He may be repre=- sented by counsel and file an answer to the complaint. Thereafter, hearings are held at which the testimony of witnesses is taken under oath. The proceeding is before an officer called a trial examiner, and the re- spondent has all the rights of any party to *8 Geo. Wash. L. Rev. 399 (1940). 28 Geo. Wash. L. Rev. 405-6 (1940). uFTC v. Keppel & Bro., Inc., (291 U. S. 304).
A3768 litigation in court. The case ultimately comes before the Commission for its deci- sion upon the record, briefs by both sides, and oral argument if requested. If the com- plaint has not been sustained, it will be dis- missed. If it has been sustained, the Com~ moission will make its findings as to the facts and issue its order to cease and desist, which is reviewable by the United States circuit courts of appeal or the United States Su- preme Court if an appeal is taken from it. A third procedure available for the elim- ination of false advertising and the conse- quent promotion of fair standards of busi- ness ethics is provided by the Commission in the trade practice conference plan. This is what I have referred to as the cooperative method. Such trade practice conference pro~ cedure has for its purpose the wholesale elimination of false advertising by industry- wide cooperation with the Commission and collaboration of all groups in interest in the formulation, establishment, and observance of fair-trade practice rules governing the conduct of the industry and trade in ques~ tion, Under the plan, joint action among competitors with the supervision and aid of the Commission is possible, and experience has proved the efficacy of this method in more than 100 industries as an adjunct to the compulsory procedure which I have out- lined. The Commission is now, with the sanction of the Congress, enlarging this method of procedure. Conference proceedings are conducted on a basis of voluntary participation; though the Commission may initiate the conference, it cannot compel attendance or participa- tion, Parties in interest are at all times free to advise and consult with the Com- taission’s representatives in the matter. Where necessary or desirable, informal meet- ings or preliminary discussions may be ar- ranged to formulate tentative drafts of rules or to develop, through an exchange of ideas, a@ clearer understanding of the problems in- volved and the assistance which can be rendered by the Commission in their solu- tion. The conference considers and pro=- poses rules for submission to the Commis- sion for its approval. Before rules are fin- ally approved or promulgated by the Com- mission, they are subjected to public hear- ings at which all interested or affected parties are afforded opportunity to present their views. They may submit such in writing or be heard orally as desired. Through such conferences and hearings, all groups in interest have the opportunity to be heard and to consult with us in the mat- ter, even though they may not happen to be classed as members of the particular in~ dustry or trade involved. In passing upon the rules proposed for ap- proval, the Commission applies the test of law. In other words, the rules must not sanction practices which are contrary to law or which, when put into effect, may bring about a result which is illegal or op- posed to the public interest. The purpose of this is, of course, obvious. It is not within our province to sanction violations of the law, but on the contrary we are directed to promote law observance, to the end that honest business may be Hberated from the waste and fetters of unfair practices, and the rights of the public may be protected. Advertising is big business. Approxi- mately 82,000,000,000 are spent annually in advertising media—radios, television, news- papers, periodicals, etc. I think the average businessman wants to fairly and truthfully advertise his product. However, you will always find individuals in almost every in-~ dustry who become a little slick In exagger- ating and misleading in their advertising of their product. Sometimes this causes others in that industry who want to advertise truthfully to adopt a similar exaggerated and misleading course in order to keep com- petitive, Under the regulations presently imposed by law, considerable progress has been made in seeing to it that advertising is truthful. The machinery set up in the Federal Trade Commission appears to be sufficient and adequate to enforce these regulations. In all probability, if the Federal Trade Com- mission had more money appropriated to it by Congress for this work, the regulations could be more extensively and expeditiously enforced. However, under all the circum- stances, a good job is being done. With the complete cooperation of business and its advertising advisers, specifically in the field of trade practice conference work, much more may be accomplished. Inci- dentally, let me here state that advertising agencies who sell advertising copy to busi- ness and persuade business to so advertise are just as responsible as business when that advertising is false and misleading, and ad- vertising agencies would be so held to equal accountability. Advertising is one of the, if not the, great- est living forces in business. Business, and that includes advertising agencies, and the Federal Trade Commission should cooperate to the fullest, not only in keeping advertis- ing great but in making and keeping it truthful, Labor-Management Responsibility—True Liberalism Which Exalts the Rights of Individuals Versus Phony Liberalism Which Subtracts the Rights From Indi- viduals a Real Issue in American Life EXTENSION OF REMARKS HON, LAWRENCE H. SMITH OF WISCONSIN IN THE HOUSE OF REPRESENTATIVES Thursday, May 18, 1950 Mr. SMITH of Wisconsin. Mr. Speaker, I am including as part of my remarks an editorial by that outstand- ing writer, David Lawrence, which ap- pears in the United States News and World Report for May 19, 1950. Mr. Lawrence points out that political power calls for great responsibility to the pub- lic. The article in question follows: Power Is Never WirHout RESPONSIBILITY Coal strikes, steel strikes, auto strikes, railroad strikes. Year in and year out, this is the spectacle of our postwar life. The power to strike has been utilized by some of the big unions to enforce demands be- yond all reason and equity. From compulsory collective bargaining, we are now but a short distance away from its dreaded sequel—compulsory arbitration. Reliance on reason and volition is less and less as reliance is more and more on coercion and compulsion, So far as the Constitution is concerned, the Supreme Court of the United States is keeping in tune with the mood of the times, which recognizes the power of Congress to foist almost any form of restriction it chooses upon individual citizens. The gulf grows wider and wider batween true lib- eralism which exalts the rights of individ- uals and the phony liberalism of today which at every turn subtracts rights from the individual. We are faced with an era of coercion. Trade unions have only themselves to blame for this backfire because they have insisted first on the sanctions of the Wagner Labor Relations Act and now, with the support of & sympathetic administration, they have be- gun to tear down all safeguards against APPENDIX TO THE CONGRESSIONAL RECORD union abuses which the Taft-Hartley Act sought to correct. The Supreme Court only last week un- wittingly portrayed the lengths to which that institution is ready to go to uphold the power of Congress. A law to forbid labor unions to strike at all is within the power of Congress now. A law to forbid companies to choose as their executives men with a dis- belief in collective bargaining 1s within the power of Congress now. Congress need only find that disruptive strikes can be the result of cherishing disbeliefs in collective bargain- ing or in any other device designated by Government to promote industrial peace. The Supreme Court majority has said that Congress may require labor-union officers to take an oath saying they are not members of an organization which seeks the overthrow of our Government. But Justice Black, in his dissent, twits the Court for disapproving what our forefathers believed in 1776. We can hardly deny in the face of the record since 1937 that the Supreme Court is following precedent in sanctioning the right of Congress to regulate all phases of labor-union activity. As Justice Jackson said last week in agreeing to ban from ap- pearance before the National Labor Relations Board any union officers who refuse to take the non-Communist oath: “Y cannot believe that Congress has less power to protect a labor union from Commu- nist Party domination than it has from em- ployer domination. This Court has uncom- promisingly upheld power of Congress to dis- establish labor unions where they are com- pany-dominated and to eradicate employer influence, even when exerted only through spoken or written words which any person not the employer would be free to utter.” But granting that Congress has the right to legislate a restriction, is such restrictive legislation imperative? It is—if reason fails, if freedom within labor unions disappears, and if elimination of Communist officers cannot be accomplished any other way. The crux of, the matter is in the develop- ment of a sense of responsibility by labor- union members and officers as well as by employers. Irresponsibllity always leads to restriction of freedom because the alterna- tive is chaos and the destruction of all lib- erty. We may all ponder, therefore, this warning which came last week from Chief Justice Vinson in that same opinion of the Supreme Court upholding non-Communist oaths: “Under the statutory scheme, unions which become collective bargaining representatives for groups of employees often represent not only members of the union but nonunion workers or members of other unions as well. Because of the necessity to have strong unions to bargain on equal terms with strong employers, individual employees are required by law to sacrifice rights which, in some cases, are valuable to them. The loss of individual rights for the greater bene- fit of the group results in a tremendous increase in the power of the representative of the group—the union. But power is never without responsibility. And when authority derives In part from Government’s thumb on the scales, the exercise of that power by private persons becomes closely akin, in some respects, to ils exercise by Government itself. “We do not suggest that labor unions which utilize the facilities of the National Labor Relations Board become Government agencies or may be regulated as such. But it is plain that when Congress clothes the bargaining representative ‘with powers com-~ parable to those possessed by a legislative body both to create and restrict the rights of those whom it represents,’ the public in- terest in the good faith exercise of that power is very great.” The warning is plain—power begets re- sponsibility, and irresponsibility leads to a forfeiture of power.
APPENDIX TO THE CONGRESSIONAL RECORD Commemorative Stamp in Honer of the Late Heywood Broun EXTENSION OF REMARKS HON. PHILIP J. PHILBIN OF MASSACHUSETTS IN THE HOUSE OF REPRESENTATIVES Thursday, May 18, 1950 Mr. PHILBIN. Mr. Speaker, under unanimous consent to extend my re- marks in the Recorp, I include therein a resolution adopted by the American Newspaper Guild at the 1949 convention and another by the Newspaper Guild of Boston at a membership meeting, April 27, 1950, urging a commemorative stamp in honor of the late Heywood Broun. So many newspaper men and other citizens all over the Nation are inter- ested in the subject matter of these reso- lutions that I am bringing them to the attention of the House and referring copies thereof to appropriate officials of the Post Office Department, with the re- quest that every possible action be taken looking toward the realization of the ob- jectives set forth in these well-consid- ered resolutions. Iam constrained to do this in response to urgent requests notwithstanding the present policy of the committee not to consider legislation providing for such stamps except in extraordinary instances with the thought that the Department may be disposed to initiate action. The following resolution, presented to the American Newspaper Guild 1949 con- vention, was passed unanimously: Whereas this year contains the tenth an- niversary of the death of our beloved first president, Heywood Broun; and Whereas December 18, 1949, will be the anniversary date; and Whereas the United States Post Office De- partment is issuing a profusion of stamps commemorating various people representing a variety of phases of American life: There- fore be it Resolved, That the American Newspaper Guild convention, in session at Columbus, Ohio, does call upon the proper officials for a@ bill in Congress to issue a commemorative stamp in honor of freedom of the press, with a likeness of Heywood Broun on said stamp; and be it further Resolved, That the top officers of the guild contact proper officials and assist them in . determining the design of said commemora- tive stamp; and be it also Resolved, That the locals of the ANG con- tact their Congressmen when such a bill is introduced and request that they vote ap- proval; and be it finally Resolved, That copies of this resolution be sent to the proper officials, favorable Con- gressmen, known to the top officers, guild locals and to several of the larger philatelic magazines. The Newspaper Guild of Boston, at a membership meeting April 27, 1950, on motion of Past ANG Vice President George A. Harris, passed by unanimous vote the following resolution: Whereas the American Newspaper Guild has gone on record, by a unanimous vote of its 1949 convention, for the issuance of a Heywood Broun commemorative United States postage stamp; and Whereas said resolution instructed its locals to contact their Congressmen with a view to obtaining assistance in the Govern- ment issuing such a stamp; and Whereas the working newspapermen of the fourth estate have done much for freedom of the press and democracy in these United States; and Whereas Heywood Broun is an outstanding example of the n~cin'e~ of newspaperdom, in that he »-™-1. © ire newspapermen in his works, deeds, and ideals: Therefore be it Resolved, That the Newspaper Guild of Boston heartily affirms the resolution passed by the American Newspaper Guild conven- tion, and respectfully requests that all Con- gressmen in the Commonwealth of Massa- chusetts receive a copy of this resolution, and lend their efforts, as our eresen notre: to placing a bill before Coni:c-=  ~ instruct the post-office officials to plan ‘for and issue a commemorative stamp in honor of the late Heywood Broun. We also sug- gest that it be issued on December 18, 1950, the anniversary date of his death. Water-Resources Projects and the Budget EXTENSION OF REMARKS HON. DEWEY SHORT OF MISSOURI IN THE HOUSE OF REPRESENTATIVES Thursday, May 18, 1950 Mr. SHORT. Mr. Speaker, under leave to extend my remarks in the Rrc- orD, I include the following address by Elmer B. Staats, Executive Assistant Di- rector of the Bureau of the Budget, be- fore the fortieth annual convention of the National Rivers and Harbors Con- gress, Washington, D. C., March 24, 1950: WaTER RESOURCE PROJECTS AND THE Bouncer I am very happy to have the opportunity to discuss before the Rivers and Harbors Congress some of the current issues before the Nation with respect to our water re- sources programs. The President, in preparing his budget, faces few more difficult problems than the development of a balanced program for the Federal Government’s part in conserving and improving our natural resources. As you know, he has expressed his belief on many occasions that these resources should work for human benefit. Only recently, he said: “In our present dynamic society, the task for conservation is not to lock up our resources, but to develop and improve them.” Yet, in moving toward that objective, the President must constantly weigh and bal- ance desirable proposals for resource de~ velopment against many other pressing na- tional considerations. While individual agencies rightly present specialized pro- gram viewpoints, the President's decisions, as reflected in his budgetary and legislative recommendations, must always be made from the standpoint of general welfare of the whole Nation. The opportunity to address this conven- tion is particularly welcome since it permits me to discuss the interest of the Bureau of the Budget in the field of water resources. The Budget Bureau is the staff agency principally responsible for assisting the President in reviewing the budgetary and legislative proposals developed in the Execu- tive Branch. Thus, it is our job to analyze and review the broader issues which the President must face in relating an indi- vidual program, like water resource devel- opment, to national programs and objec- tives. Today, I hope to discuss with you some of these objectives and show how they A3769 relate to current issues facing us in our water resources programs. The Budget Bureau’s responsibilities to the President in the field of water resources are unlike those of any other Federal agency. As the agency principally responsible for the coordination of water-resources programs proposed by other agencies, it is inevitable that the Bureau’s findings and recommen- dations may differ with the findings and recommendations of the proponents of a yrv*icutcr policy or piece of legislation. i :.: c« inevitable, therefore, that in the minds of some people the Bureau is consid- ered as being interested only in the dollar costs of such proposals—that we are unable to focus on anything except the possibility of eliminating or reducing items in the budget. However, I believe I can demonstrate that this view is erroneous and that the Budget Bureau understands that the sound develop- ment of water resources 1s far more complex than just the size of the budget estimate presented by the President to the Congress. Along with the operating agencies and the committees of the Congress concerned, we are seeking a positive, constructive solution. to our water-resources problems, recognizing that there are many factors which must be taken into account other than the size of the budget. For the next few minutes, however, I would like to discuss the fiscal and economic background against which all Federal pro- grams must be measured at the present time. Someone has said that we have lived 100 years in the last decade. Even a casual ex~ amination of our new national responsibili. ties and commitments would seem to bear out this statement. Within the past 10 years we have seen a dramatic change in the di- rection and character of the Government’s activities. Today we are supporting pro- grams at a level unthought of in 1939; we are moving forward rapidly in areas of human and physical development unknown 10 years ago. The new emphasis and increased size of the Government's activities have produced new problems and new challenges in the for~ mulation of national fiscal policies and the creation of a properly balanced Federal pro« gram. We cannot escape the sobering fact that it is not possible to view any Federal activity, including our water-resources program, solely from the viewpoint of its contribution to our economy or national well-being. Because of overriding national considerations, every de- cision on individual programs must be a compromise—a compromise between what we would like to do and what we actually can do in the light of existing commitments and the insistent demands from other segments of our society. I am sure you are all familiar with the budget figures for the fiscal year 1951 which were transmitted to Congress last January. Under those estimates, the Federal Govern- ment’s expenditures will amount to approxi- mately $42,400,000,000 and receipts to $87,300,000,000. Thus, we face an esti- mated deficit of $5,100,000,000 for the year which ends June 380, 1951. The deficit for 1951 is expected to be only slightly less than. the deficit of $5,500,000,000 estimated for the current fiscal year. You may well ask why your Government is spending more than four times what it spent 10 years ago. The answer is not hard to find. In 1951 a total of $30,000,000,000, or approxi~ mately 71 percent of the money spent by the Federal Government, will go to meet the cost of past wars and to pay for insurance against future wars. In terms of your understanding of the President’s budget problem and your prob- lem as citizens directly interested in a particular Federal program, that is the most important single fact in my statement today. It is the crux of the budget problem in these
A3770 postwar years. It is of fundamental {m- portance to a discussion of the relationship of our water-resources program to our oOver~ all national interest and policy, Specifically, we will spend about $13,500,« 000,000, or 82 cents out of every tax dollar, on national defense in this fiscal year, These are direct expenditures for defense, They do not include many other large Fed~ eral programs, which, while essentially civil~ ian, are closely related to defense needs, such as the development of atomic energy, the maintenance of our merchant marine and the provision of strategic highways. Another $4,'700,000,000 is needed to meet p.esent commitments in the international field. The European-recovery program and our expenditures for government and relief in the occupied areas of Japan and Germany will account for most of this total. In terms of the budget dollar, our expenditures for international affairs and finance will amount to 11 cents. Thus, two large Federal programs—na- tional defense and international affairs—are consuming about 43 cents out of each dollar spent. To meet interest payments on our na- tional debt will require $5,600,000,000 or 13 cents of every dollar in 1951. This does not represent, of course, any retirement of the _ debt, but merely the payment of interest. Finally, there is another large program which will take an additional 15 cents from each dollar. This is our program of vet~ erans’ services and benefits amounting to €6,000;000,000. Included in this program, as you know, are pensions, medical care, edu- cation, and other national commitments made to our veterans. Those four programs—all of them related to past wars or our efforts to prevent a future war—amount to $30,000,000,000, or 71 cents out of every dollar the Federal Government will spend in 1951. I might add, parenthetically at this point, that the income taxes which you paid this year, together with the mmcome taxes paid by all corporations, attax deevct+in~ refunds, are estimated to fall £255) 9°. ‘ww short of pay- ing for these four items directly related to past wars and efforts to achieve a peaceful world. Out of the remaining $12,000,000,000—or the remaining 29 cents, if you will—all the demands of our highly diversified economy must be satisfied. This sum must finance all programs devoted to the development of our natural resources, to the advancement of health, welfare, and education, to the improvement of our transportation and com- munication facilities, and to carrying out the services which the citizen has long ex- pected from his Government, such as carry- ing the mail, making and enforcing the laws, collecting taxes, and providing aids to in- dustry and agriculture. This $12,000,000,000 figure gives us a better perspective for considering our activities and commitments in the public-works field. Our public-works programs, drastically curtailed during the war, have been steadily expand- ing for the past 4 years. Despite a restric. tive policy on new starts, the pressure to move forward on essential projects and the inauguration of programs arising from the war, such as atomic energy, have meant a constantly growing volume of public works under way. To maintain an economical rate of construction on these going projects, therefore, has required a steady rise in cur- rent expenditures, For the 1951 fiscal year total civil public works expenditures under the budget will amount to $3,100,000,000. Thus, in relation to the $12,000,000,000 in the budget for essen- tially domestic programs, public works rep- resent approximately 25 percent of the total. And within the total of $3,100,000,000, ex- penditures for water-resources development amount to $1,200,000,000. These are 1951 expenditure figures. It is also important to realize that to complete projects and other commitments already under way in the public-works field will require almost $12,000,000,000 in expenditures 1n the years ahead. The decisions we make with respect to our policies for developing water resources and with respect to the rate of progress in con- structing individual projects are highly im- portant decisions, They vitally affect the size and character of the Federal budget not only for this year but for a number of years to come, They underscore the com- plex problem the President faces in pre- paring his budget under present-day con- ditions. He cannot escape the fact that the costs of four large programs related to past wars and our efforts to preserve the peace have increased to more than 11 times their 1939 total. All other activities of the Gov- ernment are not quite twice as high as they were then, Let me put it another, and perhaps more dramatic, way. The Government spent $8 for national defense in 1939 for each man, woman, and child in the country; in 1951 it will spend $89, The Govérnment spent 15 cents for international affairs 12 years ago; today the cost is $31. The Government spent $4 for veterans’ programs in 1939; in the 1951 fiscal year the cost to each person will be $40. To service the debt cost $7 per person before the war; it will cost $37 in 1951. For all other activities of the Govern- ment in 1939, the cost per person was $49. In 1951, in sharp contrast to other increases, that cost will rise only to $81 per person. Let us look at that increase in all other Government costs from $49 to $81 for a moment. When we consider that in this 12- year period our nepuletion will have in- creased by over 29¢00050, that our na- tional income will have more than tripled, and that the Government, like the housewife, must pay more for the goods and services it purchases, we can see how tightly the do- mestic activities in the budget have been held down. These figures all serve to dramatize the fact that the fiscal mits within which the President must plan his domestic program are extremely narrow. When the citizen, interested in an individ- ual project or service which seems eminent- ly worth while and a sound expenditure to him, hears that the Federal Government is spending $42,400,000,000, it is difficult for him to understand why that project or service, which may cost but a few thousand or a few million dollars, is not promptly provided. The President, however, in considering each proposal, must not only weight it against similar proposals, but also against the demands of scores of other unrelated programs, I can assure you that if the Pres~- ident had accepted all the recommendations that were made to him for highly desirable expenditures in the fields of defense, nat- ural resources, health, and many other ac- tivities of Government, the budget for the fiscal year 1951 as transmitted to the Con- gress would have been nearer $60,000,000,000 than $42,000,000,000. Thus, the tremendous problem facing the President is the development of a domestic program, which properly balances and ad~ justs these competing demands, for less than 30 percent of our total expenditures. The budget process is the principal de- vice available to him in achieving a realistic and proper balance among Federal programs. Viewed in this light, you can see that the budget of the United States is not an audit- ing report or an account of what has hap- pened. Instead, it is essentially a statement of program recommendations. When the President transmits the budget and the Con- gress acts upon it, they are making decisions on how much of the Nation’s resources should be devoted to each Government ac« tivity. Thus, the budget is a medium for APPENDIX TO THE CONGRESSIONAL RECORD bringing about balanced decisions in the light of economic, social, and political con- ditions in this country and throughout the world. I stated earlier that the change in direc- tion and size of the Federal program had produced new problems and new challenges in government. Let me enlarge upon that statement for a moment. Today, while the citizen is demanding increased governmental service on the one hand, he 1s, at the same time, becoming increasingly insistent that sound policies, sound organization, and sound performance characterize the services he is receiving. The work of the Hoover Commussion is the result of this insistence, not the cause. Thirty-five years ago, when our national budget amounted to less than 38,000,000,000 or about 4 percent of the total national income, there was comparatively little interest in the processes of the Federal Government. Today, with a budget of over $40,000,0000,000 or about 18 percent of our total national income, the policies and per-~ formance of government are rightly receiv- ing the attention of an increasing number of citizens. The size and scope of Government activities today underscore the need for carefully in- terrelating desirable programs; for under-~ taking them in logical and orderly sequence; “and for scheduling them to conform with the fiscal and other limitations. Even more basic, however, is the requirement that the policies and assumptions underlying these programs are soundly conceived. Let me turn now to a consideration of our water resources programs as they relate to some of the larger national issues I have just outlined. There is little question that there is a pressing need for a new examination of the basic policies and assumptions upon which our water-resources programs are built. Within the past year a number of unre- solved issues have been raised which have repeatedly underscored the existence of basic conflicts in Federal objectives, as well as in agency jurisdictions. We have been unable, in the absence of a consistent statement of national water-resources policies, to evalu- ate certain individual proposals properly in the light of the national interest. An inte- grated resources policy is needed, therefore, if we are to promote und sustain a respon- sible, stable, and effective development pro- gram. These problems come to our attention in the Budget Bureau not only because of our re.poune:bil.ty to advise the President on bud- ger csiuniares, but also because of our re- sponsibility to review and analyze, for the President, levisic+ive nroposals and proposed reports to“: Coreress on public works and other improvements. In carrying out these responsibilities the Bureau’s role is essentially one of coordina- tion, review, and advice, It must be mindful not only of the specialized viewpoint of the individual agency, but of the broader na- tional issues with which the President must deal. We recognize that national policies for the development and utilization of our water resources must constantly change as our needs change and our technical skills increase. Continuing review, analysis, and planning are needed if the various individual programs are to be based on common assump- tions and are to yield maximum benefits to the broadest segments of our economy. In this process, the Bureau assists the Presi- dent by bringing together, adjusting, and rec- onciling the views of the Federal agencies involved in the resources field. Efforts have been made from time to time to adjust our resources policies to new con- cepts and new needs and to bring about the desired coordination and cooneration between agencies and interests. Genorally, these ef- forts have been made in connection with in- dividual project proposals, or from the point
APPENDIX TO THE CONGRESSIONAL RECORD. of view of a single agency. While these efforts are commendable, they have not been satisfactory bkecause of the absence of a clear-cut and established national policy covering the several benefits and objectives to be attained. During the last session of Congress, the President on several occasions called atten- tion to the lack of certain basic policies with respect to our expanding program of water- resources development. * Among the issues to which the President specifically called attention were the follow- ing: First, what broad policies should govern in determining the use of water and land for purposes, other than agriculture, having important public values, such as flood con- trol, hydro-power production, navigation, recreation, etc.? How does the increasing demand for water for industrial and other purposes affect these other demands? Second, what uniform policies should be applied to the calculation of benefits and costs in general? What policies should gov- ern customer preferences and the establish- mers of nwh">s tower rates, repayment rates for 2e1r.ci ule services, the allocation of water for industrial uses, and many other issues? What economic and social prin- ciples should govern the assignment of the burden of cost among the several bene- ficiaries of multiple-purpose projects? Third, is there a governmental public- utility responsibility in hydroelectric power development in various parts of the coun- try? To what extent should hydroelectric power revenues be used to defray the cost of other programs such as land reclamation? Fourth, what are the proper considera- tions with respect to the timing of various resources development programs in order to promote economic stability? The President on several occasions has ex- pressed belief that, in some cases, to attack these problems on a piecemeal, or project-by- project basis, in the absence of established national policies, will only serve to confuse the basic questions involved. With this in mind the President appointed on January 3 a Water Resources Policy Com~ mission of seven members to study and make recommendations to him on existing Fed- eral legislation and policies in the water re- sources field. He has asked that the Com~ mussion give particular attention to the ex- tent and character of water-resource pro- grams, the priority of these programs from the standpoint of economic and social need, and the criteria and standards for evaluat- ing the feasibility of individual projects. This study is scheduled to be completed by December 1 this year. It is recognized, of course, that permanent answers cannot be provided to our water~ resources policies, any more than to any other area of governmental activity. How- ever, the need today is for immediate an- swers to some of the more serious policy questions in order that Federal programs in this field may move continuously forward. The need for carefully considered policies is also underscored by the tremendous ex- pansion in these programs in the past 10 years. In 1989 water-resource programs ac- counted for $280,000,000 in the Federal pudget. In 1950 these increased to approxi- mately a billion dollars. In 1951 these pro~- grams, despite a highly restrictive policy on new starts, will involve expenditures, ex~- cluding operation and maintenance, of $1,225,000,000. It is interesting to note that expenditures for rivers and harbors projects have just about doubled, while the construc- tion-cost index has risen at the same rate, leaving little net gain in physical volume. Flood control and Bureau of Reclamation expenditures, however, increased sevenfold and fivefold, respectively. This shift in em- phasis reflects the growth of the concept of multipurpose river development. The amount the President submitted for 1951 for water programs represents an in- crease over 1950 due to projects started in 1950 and the prior years. The rate of ex~ penditures for 1951 for these projects has been held to a minimum, consistent with the most economical rate of construction. There are no new water-resource projects in 1951 except for additional facilities in power- shortage areas such as the Tennessee and Columbia Valleys. Expenditures for flood control were estimated in the budget to in- crease from $459,000,000 in 1950 to $534,000,- 000 in 1951 and will probably continue at this level in 1952, despite the fact that no new starts are contemplated in 1951. The Bureau of Reclamation’s expenditures will increase within the same period from $307,- 000,000 to $354,000,000; similarly, small in- creases are projected for other programs. These figures 1¢ei ce. the policy set forth ‘in the President’s budget message as follows: “Despite the large number of highly meri- torlous projects which have already been au- thorized for construction, we should not at this time add to the present high level of commitments This policy is necessary both because of our over-all fiscal position and in order to provide the greatest possible meas= ures of stability, under present economic con~ ditions, in the rate of Federal public works expenditures.” One of the major problems involved in the development of water resource programs is that we provide adequate funds for the con- tinued orderly and economic development of all of the various phases of these programs, keeping in mind the element of time and the desirability of advanced planning and engi- neering. An adequate reserve of carefully planned public works is an important factor in obtaining a balanced and flexible program which will serve the interests of national security, provide for a means of productive economic development of the Nation, and a means for employment stabilization if and when the Congress determines that a major public works program is desirable to meet the general unemployment situation. On the basis of present prices, we now have nearly $11,000,000,000 of projects authorized put not yet started and $20,000,000,000 of projects under consideration but not yet authorized. These are principally water re- source improvements. In addition, it will require more than $7,500,000,000 after this year to complete water resource projects already under way. Thus the implications for the economy and the fiscal policy of the Nation are great. Now out of these figures and questions as to future policy I want to cite one governing consideration: The budget for water resource programs represents a major investment by our people in the economy and the future strength of our country, Whether we invest wisely or not will depend upon the under- standing and assistance of groups such as yours and the full cooperation of the execu- tive and the legislative branches. In the final analysis, the true test of a project is not whether it is a good project, but whether it is the best project possible, and whether it contributes the maximum amount to our national needs and the well-being of our people, . / The Lippmann Thesis on Foreign Policy EXTENSION OF REMARKS HON. LAWRENCE H. SMITH OF WISCONSIN IN THE HOUSE OF REPRESENTATIVES. Thursday, May 18, 1950 Mr. SMITH of Wisconsin. Mr. Speak- er, Lam including as part of my remarks A3771 a portion of an article entitled “The Lippmann Thesis,” which appears in the May 17 issue of the Christian Century. I commend it to the attention of all Members of Congress who are interested in the important problem of foreign policy in view of world conditions: qm Mr. Lippmann has outlined his thesis for an intelligent and effective foreign policy in an article, Breakup of the Two-Power World, which appeared in the Atlantic Monthly for April. He has reinforced the arguments in that article 1n several of his syndicated columns which appear in more than a hundred daily newspapers. Briefly, the Lippmann thesis is this: The Truman doctrine and the policy of a military containment of Russian communism are failures. They are not only failures; they have become irrelevant and outdated in the light of six major developments of the past year. These are (1) the Russian A-bomb; (2) China; (3) the dissolution of the British and Dutch Empires in south Asia; (4) the chaotic developments in Indochina, Malaya, and Burma; (5) Tito and the Titolstic tend- encies in Poland, Bulgaria, Hungary, and Czechoslovakia; (6G) the revival of Germany. The combination of these “has created a radically new situation that will compel all the ta-c~tricnts to reexamine their estimates of ti: « “a %ar and their calculations and their policies.” One thing these events show, says Mr. Lippmann, and that is that the assumption, made by both Russia and the United States, that the whole world must line up either in the Russian world or in the American is a fallacy. The common factor in all except the first of the six events listed is that one siae in this struggle has lost control of an im- portant region without the other side gaining certain and permanent control. This can prove true even in China. In addition, the loss of America’s atomic weapon moxopoly fundamentally alters the military situation, especially in Europe. It renders the North Atlantic Pact of very doubtful value, for the military stalemate between the American strategic Air Force and the Red army has been broken. If we invite nations on Rus- sia’s periphery to join us as military allies, we must now offer them defense not only against the Red army but against atomic pombardment. This we can no longer do. An invitation to a military alliance with us is an invitation to make themselves the bull’s-eye for Russian atomic blasting. No nation in its right mind can be expected to be attracted by such an invitation. What, then, is likely to happen? “The Germans are a highly intelligent people,” writes Mr. Lippmann, “especially in military matters when they are not befuddled by demagogues like Hitler. They are confronted witb a dilemma and they know it, and there is only one way out of it open to them which offers them any prospect—even if it is not a certain prospect—of security. The Germans will take that way out because there is no other way out. They will recognize that they lie between two armed coalitions, each at- tempting to win them over to it. They will exploit this middle position to recover their national independence by making demands and gaining concessions from both sides. They will shake off the controls of the oc- cupying powers. They will get rid of the military occupation. Then they will develop their middle position in the heart of Europe outside either alliance, and in between both alliances, to regain their power and influence in Europe.” A similar policy, Mr. Lippmann believes, will evolve in most of the other nations which are now under pressure to join either the Russian or American power blocs. It ts the policy already announced by India, Pakistan, and Indonesia, It is the policy
A8772 others are longing to adopt—and that in- cludes Japan. “It is the policy of avoiding entangling alliances in a two-power world.” And what should American policy be if these things are true? Not to try to form @ world-compassing, hard-and-fast global coalition against the Russians. To do so would be to hasten war, and at the coming of war most of our reluctant allies would be revealed as military liabilities. Our proper policy should be “to frustrate and to disorganize and to disintegrate any Soviet attempt to form a global coalition.” “That would mean,” says Mr. Lippmann, “‘that we put our influence and power behind the general tendency toward mational inde- pendence, toward military neutrality, and toward diplomatic disentanglements—a tendency which is manifest in almost all of Asia, and in much at least of central and eastern Europe. I believe that in the lasts analysis the matter reduces itself to this: that since we cannot encircle the Soviet Union by a military coalition, we should cultivate and exploit all the national forces, all the human impulses to escape from the havoe of war, in order to prevent the Soviet Union from forming its coalition and in order to disintegrate its military alliances in eastern Europe and those which it hopes to achieve in Asia. nr To us, this makes sense. And before the reader comes to a different conclusion, we trust that he will read Mr. Lippmann's com- plete argument in the Atlantic and follow with care the corollaries of that argument as he develops them in the daily press. If the Lippmann thesis does make sense, it fol- lows that the premises on which the United States is proceeding at London are mistaken, The world need not be divided into two armed camps. The cold war need not go on until it turns into a hot war. The United States need not risk bankruptcy and ruin to pay for ghastly expensive military alliances as the only means of halting the Communist advance. There are fat more promising ways to deal with the current world crisis than those which are now coming out of the Pentagon and State Department. And if the men who are meeting in London will not listen when a man with Mr. Lippmanun’s standing tries to tell them this, then we hope that at the next Assembly of the United Nations those countries which are being driven by our policy and Russian’s between two lines of fire will seize that platform to make this thesis heard throughout the earth. Soviet Gold Smuggling EXTENSION OF REMARKS HON. DANIEL A. REED OF NEW YORK IN THE HOUSE OF REPRESENTATIVES Wednesday, April 26, 1950 Mr. REED of New York. Mr. Speak- er, under leave to extend my remarks in the Record, I include the following article by Sylvia F. Porter from the New York Herald Tribune of May 16, 1950: Sovirer Goup SmvuGcLina (By Sylvia F. Porter) Russia ls now smuggling vast fortunes in gold bars and coins to her agents in key spots of the world—in Sweden, France, Italy, Switzerland, Tangiers, Hongkong, Macao, Inside reports are that the Soviet’s ship- ments of this most precious of all monetary metals just in the last 15 weeks run far above $200,000,000, may even surpass the $300,000, 000 mark, This places her gold shipments on an ex- traordinarily high level, for in these times, gold movements of this magnitude are rare for any nation except America, They’re virtually unprecedented for the Soviet Union. The gold is being taken out of her metal reserves, is being loaded on Russian steamers, is being shipped from such ports as Vladivo- stock to such ports as Marseilles and is then being rerouted to the Soviet’s financial agents in the chosen areas. It is not being done officially; no an- nouncement of the shipments has been made, of course. But from Zurich comes the story of large arrivals of gold bars in transit. And the bars have been identified as Russian. From Tangiers and Macao comes the tale of the sudden appearance of big bags of gold coins and bars. And the bags bear not only the stamp of the U. S.S. R., but also carry the stampings of the original owners— “Reichsbank, 1912.” “Federal Reserve Bank, 1932.” (It was in 1932 and 1933 that gold was fleeing the United States for safer havens.) When General Eisenhower addressed the Nation’s newspaper publishers in New York recently, he urged them to seek clues to Rus- sia’s plans in her commercial and economic transactions. For, often deals in this area reveal more than a thousand diplomatic maneuvers. What then has the Politburo in mind here? What might these vast gold shipments imply to us? We know how deeply the Soviet treasures her gold hoard—variously estimated at from 2 to 5 billion dollars. Why then is she send- ing such fortunes cutside her borders and doing it unofficially too? We know that spies are traditionally paid in gold and Russia surely pays off hers in metal as we surely pay off ours. But what sort of esplonage could possibly warrant this level of smuggling? I’ve been checking with financiers who study and deal in these mysterious markets, They see three explanations. First, Russia is building up gold hoards in key spots for future dumping purposes— is getiing set to dump gold in the global markets to drive down its price at crucial moments, She already has dumped plenty of the metal. Her sales in Paris, Tangiers, etc., dur- ing February and March were a major factor in the sensational slump in the world black- market prices for gold. The reason: To bewilder and terrify the industrialists of Europe and Africa who com- pletely distrust paper money, have faith only in gold as a measure of value and their own fortunes. When the world gold price erashes, their confidence is bitterly shaken, their willingness to invest in and continue pusiness activities is deeply undermined. Officially, Russia would not sell gold on the black markets. Unofficially, she could— and she has dumped and she will dump to wage economic and psychological warfare on the West. Second, Russia is creating these hoards in outside spots so she can pick up foreign currencies when she wants them—the pound, the dollar, etc.—at prices much below the official rates. For gold still will buy any currency at a discount in the world markets. And again, the economic and psychological advantages to the Soviet are clear. Finally, Russia is getting in position to wage a ruble offensive against the pound and the dollar, to back her currency with gold in fact as well as fancy—when and if she’s ready to move, ‘ APPENDIX TO THE CONGRESSIONAL RECORD The ruble bloc will go on the offensive against the dollar and sterling blocs when Russia can swing it. It is another clue. This is international money juggling in the classical tradition. A pattern of com- petition and conflict is being drawn—and Russia is seizmg upon every weapon the capitalist nations ever devised. If we fail to act positively on our own in this sphere, we will commit an unpardon- able blunder—no, a criminal blunder. Winning a Defeat EXTENSION OF REMARKS HON. LAWRENCE H. SMITH OF WISCONSIN IN THE HOUSE OF REPRESENTATIVES Thursday, May 18, 1950 Mr. SMITH of Wisconsin. Mr. Speaker, as part of my remarks I am including an editorial that recently ap- peared in the Milwaukee Journal. It points out that we are soldiers winning the war and our politicians have lost the peace at a terrific price. Now the facts are coming to light. Mr. Roosevelt who believed that he could mold Mar- shal Stalin in his own image and think- ing, failed to do so, and in addition, Stalin walked off with half of the world at Yalta. The editorial follows: il , WINNING A DEFEAT Having triumphantly won the global war this country is now—at enormous expense— ingloriously losing the global peace. This is not the fault of our strategists, Their campaigns were ably organized and brilliantly conducted. But our generals and admirals went where they were sent: they themselves were com- manded by politicians, most of whom lacked military or diplomatic experience: and it was political leadership which, in the very course of victorious war, laid the bases for our ultimate defeat. Obviously, therefore, if postwar disaster 1s to be averted, the wartime errors committed in our name must be understood so that their worst consequences may perhaps be tardily eliminated. During the war, because of censorship and secrecy, the American people had virtually no knowledge of their political misguidance. But the facts have been coming to light. For example, the Atlantic Monthly has published and the Reader’s Digest had epit- omized, a revealing article entitled “Our Worst Blunders in the War" by Mr. Hanson W. Baldwin, military editor of the New York Times. This article, with other writings, shows clearly that, by his political conduct of the war, President Franklin D. Roosevelt was mainly responsible for our postwar dangers. The first error was Mr. Roosevelt’s child- like belief in the integrity and good will of Marshal Stalin and the Politburo. The President actually believed that Soviet Russia had forsaken its objective of world communism—and could be trusted. The President actually believed that our wars could not be won without Russian sup- port, when actually the opposite was true. Influenced by these delusions, the Pres- ident rejected the British plan for a Balkan invasion, which would have excluded Russia from central Europe,’ and bribed Russia— with gifts of Chinese territory—to enter the
APPENDIX TO THE CONGRESSIONAL RECORD Japanese war when Japan was already beaten. Our political objective was speedy victories by any ruthless means, not a just and durable peace. As a result, Russia stands poised today for the conquest of all Eurasia. Two other political errors need to be cons sidered. One was the unrealistic doctrine of uncon- ditional surrender lightheartedly  pro- claimed by Mr. Roosevelt at Casablanca. This doctrine made a German surrender impossible until Germany had been totally wrecked And, in the words of Liddell Hart, the British expert: “War to the bitter end was bound to make Russia top dog on the continent.” The second error—equally disastrous in Asia—was the Rooseveltian policy of anti- colonialism. Borrowed directly from Marxism, Mr. Roosevelt’s insistence on the abolition of the colonial system was responsible for the revo- lutions in south Asia. Hence has come about the great weaken- ing of the British and Dutch empires—for centuries, stabilizing and civilizing influ- ences in the east—which is truly one of the goals of communism, There is still time to rectify—at least to modify—some of the evils caused by politi- cal mismanagement of the war. But this will require a different kind of management from the kind we have now. What a Farmer Thinks of the Extrava- gances of Truman and His Cabinet EXTENSION OF REMARKS HON. THOMAS A. JENKINS OF OHIO IN THE HOUSE OF REPRESENTATIVES Tuesday, May 16, 1950 Mr. JENKINS. Mr. Speaker, under leave to extend my remarks in the Rrc- oRD, I wish to say that Mr. Louis Brom- field in addition to being a very success- ful author of a number of popular books is also a citizen of Ohio and is a big farmer. <A few days ago in his column he took upon himself the task of showing to the public the extravagances of the administration high officials. He does a finé job of it. The following is what he writes: At last Congress has shown signs of moving in on the leaders of Mr. Truman’s adminis- tration and the Democratic National Com- mittee. For months and years now every taxpayer, regardless of his feeling toward Mr. Truman and his socialistic platform, has been paying his share of the expenses to pro- mote Mr. Truman, his friends and his ideas. How? Through the old Pendergast ward politics system of charging up expenses of political campaigning to the Government it~ self. Let’s look at the record. For months now Mr. Brannan, Secretary of Agriculture, has been touring the country, Making speeches, attempting to sell Mr. Truman and his wel fare state to hundreds of thousands of citi- zens. There has been and there can be no pretense as to what he is doing. The atti- tude is wholly partisan both as to ideas and as to politics. The Democratic National Com- mittee rather than the taxpayer should be paylng the bill which runs in a year or 60 into hundreds of thousands. XCVI—App.—— 238 Mr. Tobin, Secretary of Labor, has been fol« lowing the same pattern, rarely making any~< thing but partisan political speeches which sound as if he were a paid propagandist for the big officials of organized labor whom the Democratic Committee woo so passionately. Who paid for it all? You and I. Mr. Ewing, Federal Security Administrator, tours not only this country but Europe with special attention to the socialist government of Great Britain. On his return he did quite a bit of traveling and talking in praise of British socialism and in particular of social- ized medicine, which is simply a back-handed way of making hay for Mr. Truman and his program. Who paid for 1t? You and I. And so on and on it goes throughout most of the Democratic officeholders in Cabinet and administrative posts. Vurtu- ally every one of them is guilty, and when we add up the total, including Government planes which are freely commandeered in the interests of the Democratic Party, the pill comes to many millions of dollars. Who pays for it? Not the Democratic Party campaign fund, but you and I every time we pay our income tax or go to a movie or send a telegram or ride on a train or buy a cigarette. Under law and Constitution, all the posts represented in this spending of taxpayer’s money for the benefit of Mr. Truman and ‘his friends were set up as administrative posts, clearly established as nonpolitical. Under the long 17 years of the Democratic rule they have turned more and more simply into debased political sounding boards in which the administrators spend more and more time away from their inefficient, ex- pensive, and confused departments in mak- ing political speeches. The Department c? Acricutture, for ex- ample, was clearly est. tlisicd by law, and for many generations by honest precedent, as an agency for research and education bene- ficial to American agriculture. The present Secretary is a New Deal Denver lawyer with- out direct contact or experience wiih agri- tulture or any of the farmer’s problems. How much time does he spend trying to straighten out the administrative mess into which his Department has been made by successive political appointees? How much time does he spend pressing research and education? And how much time does he spend on the road selling Mr. Truman, the welfare state, and Socialist ideas which would completely regiment the farmer in return for an inadequate check paid out of taxpayers’ money? Only recently at a Minnesota meeting, farmer members of the Production and Mar- keting Organization (incidentally the worst political set-up in our Government) were given per diem pay and expenses by car, train, and in hotel, to travel considerable distances in order to hear Mr. Brannan make @ political speech in favor of the welfare State, the Brannan plan and Mr. Truman. Who pays for this skullduggery? Guess. It is not the Democratic National Committee. The President himself is no better. Re- cently it was recorded that he winked at reporters when he mentioned his forthcom~= ing nonpolitical trip to the Northwest and back again with speeches at every whistle stop. The trip will cost well in excess of a hundred thousand dollars. Who pays for it? Guess who. You and I. When clearly it should be charged to the Democratic Party campaign fund. This is the kind of thing we get when we place in office men who are essentially professional and sometimes cheap ward politicians. . . Fortunately Congress has begun to, take notice of these practices which honest citi- zens can regard only as an outrage, not only A3773 against themselves but against decent demo- cratic government. Mr. Stalin and his friends operate on the same system but more frankly and honestly. It might just be that this situation is a good subject for a letter to your Representatives in Washington. That’s the only way we shall stop what is one of the cheapest and most shameful practices in American history, as subversive to good government and good democracy as anything the Communists have ever attempted to pull off in our midst. Secretary Chapman Favors Arizona Despite Budget Bureau, Says Arizona Paper EXTENSION OF REMARKS HON. CLAIR ENGLE OF CALIFORNIA IN THE HOUSE OF REPRESENTATIVES Thursday, May 18, 1950 Mr. ENGLE of California. Mr. Speak- er, under leave to extend my remarks LT include the following editorial from the Arizona Republic for May 12, 1950: GAIN FOR ARIZONA Arizona gained an advantage in the debate on the list of factual questions to be submit- ted for governmental agency answers before the House Public Lands Committee vote on the central Arizona project authorization pill, Not only are the questions the ones that are expected to produce answers favorable to the project, but they are going to a friendly camp—the Department of the Interior. California’s original success in pointing its list of questions to the Budget Bureau was swept aside in the latest conference. This agency at the beginning of this session of Congress virtually blackballed the project ahd was then persuaded to replace its blast with a second report from which the barbs had been extracted. Even in its revised form, it was politely non-committal, rather than favorable. Since that time, a new Secretary of the Interior—Oscar Chapman-—has taken his place in the Cabinet. He is known to be exceedingly friendly to Arizona. Besides, the questions probably will be answered by the Department’s Bureau of Reclamation, which has warmly endorsed the project. Thus Arizona’s best interests are probably served in by-passing the Budget Bureau. By eliminating the policy questions that might draw unhelpful replies, and basing the requests for data on engineering and financial considerations from the Reclamation Bureau, Arizona's cause stands to be strengthened when the bill comes up for a committee vote after June 15. There is reason for optimism in that no other barrier seems to stand in the way of a committee recommendation at that time. A day or two may be required to go over the submitted material, but a vote could be expected soon after the project is resubmitted. The only barrier then standing in the way of final acting in Congress will be getting a place for the bill on the House calendar. The measure having already passed the Sen~ ate, if given a favorable recommendation by the House Public Lands Committee, a place would probably be found for it. References made by the President on his western tour indicate an apparent friendll- ness ‘to reclamation projects such as the one Arizona sponsors. If it received an encour~ aging White House nod in June, the project might clear its high hurdles smoothly.