The sun. [volume] (New York [N.Y.]) 1916-1920, 1919-06-27

$SOO,OOO,OOO DEALS
PLACED FOR $4,000
Charles Eisenmann Tells the
House Probers Of Defence
Councils System.
DEFENDS 81 A YEAR MEN
Says War Departments Pur-
chasing System Later Cost
81, 100000 Yearly.
DEFENDS 81 A YEAR MEN
sp.csai De,pstcA TO TIE sur.

Special DespafcA to Tar Sur.
WASHINGTON, June 2s.-That the Gov
eminent had handled $500. 900. 900 In con-
tracts for supplies early in the war
through the cooperation Of the committee
on supplies of the Council Of National
Defence at q total expense OF $4,000
whereas the purchasing system OF the
War Department, after the council ended
It's purchasing functions, was organized
on an annual expense basis Of $1,000, 900.
was brought out In the testimony to-
day Of Charles Eisenmann of Cleve-
land. formerly vice-chairman Of the
committee of supplies Of the council, be-
fore the House Committee investigating
war expenses
Mr.. Eisenmann described In detail the
method OF organising the industries OF
the country to meet the war emergency
and that of making purchases for the
Government
Billions saved In Steel.
Grosvenor q. Ciarkson, director of the
council, also testified that the council
had saved the Government f3.1l2.00o,00 600
In purchases Of iron, steel and coke alone
by obtaining these materials at lower
than then current prices
Lieuts-Coi. Julian l.. Schley was again
before the COMMITTEES. In answer to q
statement by Chairman Graham that he
had been informed that upon being sum-
moned before the committee Col. Schley
had been ordered to q conference with
Gen. March, chief OF STAFF. the Colonel
stated that the General, In the presence
Of Gen. Lord. had informed them both
that tho War Department was to be en-
tirely at the service OF the committee.
Asked how long he had been In Gen,
Marchs office Goa Schley said not over
ak minutes. Mr.. Graham asked
whether the witness had had q subse-
quent conversation with Gen. March and
was told that he had reported the desire
Of the committee to have some officer
who could tell OF war expenditures prior
to September, 1918, and had suggested
the names of several officers.
M. Eisenmann. concerning whom
many rumors were afioat at the time
of his work with the Committee on
Supplies of the council, frankly an
swered scores OF questions put TO him
by members. He described the method
OF buying for the Government and for
the Allies. which was in effect up to the
time these functions Of the Council OF
National Defense were discontinued In
January, 1913. and were superseded by
eminent bureaus.
He said that. except IN the case of
shoes. 1t was necessary to take extra
ordinary measures to increase produc-
ton. and therefore competitive bids were
out of the question In dealing with the
/ situation. Bids for shoes were invited.
ana contracts awarded on the basis OF
the lowest bidder. but In other cases
represe natives of the various Industries
forming the advisory committees were
called in and told of the Government
requirements. a price was fixed, orders
were issued to speed production. and
purchase orders were allotted wherever
! the goods could be obtained. More
| than forty-fivs thousand orders for cot
ton and woollen goods alone were placed
In this way. said Mr. Eisenmann.
Some Of these were for the allied
Governments Some purchases were
made for Russia, ne said, but the Rus
sians bought some direct for themselves
| They were not always the easiest 10
handle. for reasons" he remarked.
His Company Benefited Little.
Asked by Chairman Graham whether
the witness had any objection to put
| ting into the record an excerpt from the
| report OF the council showing that
| $4,000. 900 of orders for goods had beer
placed with the Cleveland Textile Com
pAny. in which Mr.. Eisenmann IL a
stockholder, Mr. Esenmsnn said ne had
| no objection whatever. but remarked
| that some $500, 0o0. 900 OF orders for such
| goods had been placed
Representative Garrett (Tenn) asked
| whether the company Mr.. Eisenmanr
was interested in had made large wal
profits. The witness said that while
he is still O stockholder. he had not
been a director or otherwise connected
| with the affairs Of the company fol
| fifteen years and had not been In the
4, plant for Ave years
His recollection, however. from thu
| published annual report OF the company
and from his last dividend was that tn,
| company made something less In 1911
and 1913 than the average for previous
| years. This was because the company
had been compelled TO make Government
goods at a disadvantage.
| 81 have not paid much attention TO the
company's affairs" remarked Mr.. Essen
mann. You know how II is when you
| have stock in thirty-fve or forty con.
Germs. When you read their reports AND
sec they have been prosperous you are
happy and II the report Is bad you are
sorry.
| when ! was asked TO come 10 Wash
ington early in the war to do this worI
told them was n stakeholder and Il
IL made any difference would 70 home
was not anxious for the job"
In answer 70 a question about how
much stock he held in the Clevelant
WoTsted Mills the witness said hi
thought II was 1850 shares, par 100. II
a capital issue OF eleven or twelve mil
lion dollars.
| Chairman Graham sought To bring ou
the comparative expense OF conducting
purchases for the Government under thu
council plan and under the War De.
partment.
| 1T was at an infinitely greater cos
whom tho War Department took over thu
purchases" replied Mr.. Eisenmann
Urged 90 explain the departments higher
prices tho witness said IT wouldn't liks
TO answer for the other fellow, but II