New-York tribune., 1918-12-20
Piez, ON Stand at the Re-
newal of Senate Inquiry,
Explains Work Delays
Says Order Was Changed
Only Three OF Four Boats
Ready by Jan. L; Rest of
so Done Early in Spring
By Theodore M. knappen

Hog Island mess was stirred up by the
Senate Commerce Committee again to-
day Just as the Department of Justice
was preparing to release its bclatcd re-
port on the same subject. Some Of the
old ground that was traverscd last Win
ter and spring to the extent of several
thousand pages was gone over again,
but the probing day largely related
to the present condition of affairs and
prospects at the worlds largest ship
building yard.
he leading investigator was Senator
Hiram Johnson, OF California. who has
been almost as invetcrate as Senator
Vardaman in his antipathy to the
whole Hog Island enterprise. Incl
dentally there was some consideration
of the whole ship building achievement,
including the housing and transporta-
tion work and the wooden ship pro-
gramme.
Charles NJ Schwab, director general
of the Emergency Fleet Corporation,
and Charles A. Piez, general manager
who is to succeed MIR. Schwab on the
latter's retirement, were summoned to
appear before the committee, but by
the time it had disposed Of MIR. Piez
there was no time left for Mr. Schwab
and he was requested to appear again
at a meeting to be called soon after
January ! Several Of the high officials
Of the American International Corpora
ton. which conducts the Hog Island
yard, as agent i or the Emergency Fleet
Corporation. attended the nearing.
Yard Has Cost S5S,OOO,OoO
Mr.. Piez apparently did not share the
enthusiasm Of some of the Senators for
the idea that now and always every
thing has been wrong at Hog Island
He said that up to date the yard had
cost S58 5000, 900 The American Inter
national had so far received practically
nothing on its managerial fee, and he
understood that it had expended con-
sderably more than $1,000,O00 out of
its own pocket to facilitate the work.
He said that he did not consider fee
of 5 per cent excessive and called atten-
ton to the fact that the American In
ternational Corporation received moth
ing whatever for constructing the yard
delivered and that on account of failure
to complete them according 90 contract
it stood to lose $2,700,000 Of the maxi
mum fee of $S,910000. Mr.. Piez was
not ready to say that the government
should cancel the contract on the
ground of performance and oust
the American international as agent,
government itself, by the Emergency
| a mr. "a n
the management, as a result of the
/ panic created Dy the former investiga-
ton, had not contributed to the retarda-
ton Of the work.
Has Revised It's Programme
Mr.. Piez called attention to reports
regarding housing and wooden ships
that had been submitted to the Senate
in response to resolutions by Senators
King and Harding, defended the wood
en- ship, and stated that the Emerpencv
Fleet Corporation had not in any de-
gree suspended operations since the
signing of the armstce, though it had
revised its programme to meet com
mercial rather than bellgerent condi
tons.
Referring to the published statement
that whether the Fleet Corporation
would take over Hog Island or con
tlnue it as an agency would be deter
mined by the record up to January
Mr.. Piez said that this conclusion was
IN pursuance of an understanding with
the American International, arrived at
last May. The company then com
planned that as Admiral Bowles, on be-
half of the Fleet Corporation, had vir-
tually taken charge of the direction of
all operations at the big yard, it had
been deprived of authority, but left
with responsibility, and yet operations
were being conducted in manner con-
trary to its Judgment. Mr.. Schwab then
told the American International Cor
poration to go ahead with operations
IN its. own way, and that on January l
a review of its work would determine
the future disposition of the yard At
that time it was apparent that the cost
OF building vessels at Hog Island was
greater than in private yards.
Original Contract Changed
Mr.. Piez pointed out that, except for
the failure of the agent to comply with
the contract, the Emergency Fleet Cor
poraticn could not avail itself of the
option to take over the plant until
after one hundred vessels had been
completed.
In response to questions from Sena-
tors Hiram johnson and Lenroot, Mr.
Piez said that originally the contract
called for the completion Of fifteen
ships by November IL; subsequently
this had been changed to fifty by Jan
uary |. The number that would be
completed by January l would be three
or four. The remainder of the first
fifty ordered should be completed
within the next three months, at the
present rate of progress.
OF the steel required for all the
vessels contracted for at Hog Island.
100000 tons, 35 per cent, had been
received, representing $67, ,000,000; 18
per cent, or S32000,000, was in proc
css of manufacture or delivery and
the remaining d7 per cent required
would cost s9o,00o,000. Practically all
of the steel, engines, boilers and ac-
ccsSories were under contract These
figures were given to throw light on
the question of cancellng the contract
by negotiations as to a part of the
ships.
Mr.. Piez said that the Fleet Corpo-
ration had recently had some expert
cncc with cancellations and that the
ramifcations Of such work were ex-
treme and multipleX. All contracts
for material We're in the name of the
Fleet Corporation, with the Ameri-
can international appearing only as
agent.
Government Does Its Part
Then" said Senator johnson, "if |
understand you correctly. the govern
mcno pays all the bills at Hog Island
makes all the contracts assumes all