The New York herald. [volume] (New York, N.Y.) 1920-1924, 1920-11-19
LIQUIDATION OF
SHIPPING BOARD
AFFAIRS URGED
Witness at Inquiry Says
Hopeless Mess Should
Be Cleaned Up.
QUICK ACTION NEEDED
Expert Would Have Con-
gress Create Board of Five
Business Men.
LOSSES IN OIL TANKERS
Gfllen Points Way to Protect
Merchant Marine and Pre-
vent Future Waste.
QUICK ACTION NEEDED
LOSSES IN OIL TANKERS

Losses to the Government through
faulty operation Of oil tankers, over
payment Of claims arising from i'm
proper cost plus contracts and the
expense of auditing claims against the
army were described yesterday by
Martin j. Gillen. former special
executive assistant to John Barton
Payne and Admiral William S. Ben
son, in resuming his testimony be-
fore the Congressional Select Com
nittee on United States Shipping
Board operations.
At the end OF his testimony Mr.
Gillen was asked by Representative
Henry ]. Steele of Pennsylvania what
constructive suggestions he had to
make as the result of his long ex-
perience as a corporation reorganiza-
ton expert and from his close asso-
citation with the troubles of the Ship.
ping Board. In effect Mr.. Steele adj
United the losses which have been
charged and wanted to know what
can be done about 1t.
Mr.. Gillen. after giving brief out
line of some of the first things he
would do In recognizing the affairs of
the Shipping Board, promised the COM
mittee that he would prepare a de-
tailed list of recommendations which
should be put into effect.
Favors Liquidatins Board.
~ would remove from the Shipping
an n ssatr 4,,- It.@t
over the balance OF construction that is
under way. all supplies and sales. the
settlement OF claims and the collection
OF back accounts.
y would have Congress create a small
now hquidating corporation. made up Of
five outstanding business men, to do the
cleanup Job. Under such an arrange
znent the new Shipping Board can begin
at once to handle a big going Job with
out bothering with the hopeless mess
which has been handed down from the
war.
Each OF the six members of the new
board. besides Admiral Benson, the
chairman. should have one job to do.
There are eight or nine big pieces Of
work that should be distributed among
the members of the board, Among them
are the dock situation. the matter of
supplies. operations. repairs. stevedoring
GnQ tne COt1lItlSSAOnb DelIB pdlQ 10 DTOh-
ers."
The War Department at the present
time, according to Mr.. Gillen, owes the
Shipping Board $l7S,000.000 Until a short
rirne ago this claim amounted to $685.
10000, he said. but payment of $780,
10000 has recently been obtained. He
said the auditing Of this claim alone put
the Shipping Board to an expense OF
$4,000 and probably cost the War De-
partment as much more for its own
audit.
Tells of Duplicate Auditing.
The bill against the War Department,
The witness explained, was for the oper-
alton of Shipping Board vessels as troop
and cargo carriers by the army, the con-
structlon Of army transports with Ship
ping Board funds. payment for losses in
submarine attacks and the refitting of
cargo and passenger vessels as troop
carriers. Mr.. Gillen charged that the
War Department duplicated the Shipping
Boards machinery In passing on these
payments and invariably held them up
80 that the large bill was allowed to ac-
cumulate.
Former Brighten. Frank T. Hine was
named by Mr.. Gillen as being RESPONSE
bic for holding up the Shipping Boards
bills. He said that Gen. Hine took es-
resigned from the War Department last
summer. Mr.. Gillen said. and became a
''supp'icant" before Admiral Benson.
The withdrawal of Gen. Hine the wit
ness said. brought almost inmediat e
action on the claims. The Importance
of collecting bills similar to the one
against the War Department, no said.
Jay In the fact that this and like pay
ments had enabled the Shipping BOARD
n continue In htIafnaeo INTEL,
preparation from Congress last spring.
ut was just one department taking
another departments bills" said Mr.. Gi,
len, "and playing with them while the
taxpayer paid
Representative Patrick II. KELLEY Of
Michigan asked Mr.. Gillen II It would
not be advisable to have both Govern
lnent departments mark the items of
heir books and ask Congress to MAX.
good the deficiency In keeping with a
suegestion made by Mr. Gillen last
March. Mr.. Gillep replied that the time
for doing that had passed, as the ac-
countants engaged In the audit have
practically completed their work and
the entire matter Is Just about in shape
for action by the War Department.
Suggests Plan for Funds.
Mr.. Gillen suggested that the s17s.-
owes the Shipping Board should be
definitely approved or disapproved al
Jnce by Secretary Baker in order that
he Shipping Board may know what n
q to receive and then apply to Congress-
70 equalize the difference when consider
ing appropriations for both the hon I'd
md tho War Department
Mr.. Gillen spent most OF the afternoon
swing the results of his study of the
way oil tankers were handled bv tba
Shipping Board. He said that until
last May the Shipping Board had No
chart showing the location of it's tanlx-
era, how much oil they had or anv.
thing else about them. a chart waa
made. he said. OF the fifty-four shin
ping Board tankers in operation. Of
which thirty-three were in Government
service. The others were leased to cor
porations and individuals.
80 found" said Mr.. Glllen. that
100000 barrels OF oil year was
needed to run the fleet of Shipping
Board vessels. l foun1 that Capt Paul
Foley. the director If operations, did
not know that 10 per cent. OF the ships
we're buying oil at the rate of from
"a to $40 barrel In the open market,
while the remaining 60 per cent. we're
bsing furnished oil by the Shipping
Board for from only s2.W to s2.So
20 NAY "a called upon the division
II