Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1921-01-22
SchIUdb's Work
Praised BIZ Piez

| pald all OF his own expenses.
Says Report Ignores Facts
Mr.. Piez said Mr.. Gillen's report
did not square with the facts in a
single vital case in which he INDUCED
IN criticism concerning the division OF
construction; that his charge that there
was interference between management
and trustees in placing contracts was
wholly untrue; that he was guilty of
gross misstatements of facts regarding
the fleet corporations $3.50 900 900
mortgages and securities, and that his
statement Of lack Of an accounting sys-
TEN was wholly wrong.
Mr.. Piez also declares TINT Gillcn 3
report regarding the fleet corporation g
check against authorizations and appro
priations is absolutely wrong, and that
The destructive effect of his testimony
has seriously impaired public interest
In the establishment Of an American
merchant marine. and practically de-
stroyed the market for shipping securi.
ties.
Ships were built to meet the ncces-
fitics Of war. Mr.. Piez says, not to
establish merchant mnrine that the
emergency feet corporation delivered
{ 20 vessels before tho armistice was
signed: that the task was to build
ships faster than submarines could sink
them, and that the building of ships
was conducted in systematic and
businesslike manner.
General George w. Goethals inaugu.
rated the accounting system.
Situation Misunderstood by Public
This influence on the part of the
public" Mr.. Piez continued, ''is
in large measure the result Of the
wild statements made By Mr.. Gil
len concerning the methods of the fleet
corporation, and to the general state
mentS OF graft and corruption con-
tanned in the Fisher Richardson report.
The public docs not diffcrentiate the
division of construction from that of
operations, and concludes that because
there, was petty graft among minor
ships officers in the victualng and
repairing of ships In operation. that
the entire structure Of the corporation.
from top to bottom, was honeycombed
by a like condition.
Graft in ship operations has from
time immemorial been considered one Of
The prerequisites of petty officers, and
is difficult disease to eradicate. It
has no place in the operations of an
American feet. and should be treated
with an iron hand.
But 1t Is to be regretted that the
Fisher. Richardson charges are couched
in such general terms that they have
besmcared the whole structure of the
shipping board and fleet corporation
With the slips of suspicion. Many Of
the charges should have been made in |
the police courts rather than in a re-
port of such Importance"
Mr.. Piez's Statement
Mr.. Piez's statement says:
The effect of the testimony thus
ar presented before your committee
las been seriously to impair public |
interest in the establishment Of an |
\merican merchant marine. practically |
o destroy tho market for shipping Sc
,,urities. and to make the already diff
icult task of the United States ship
,ing board much more difficult.
This effect has been produced in
'art by sensational headlines, in part
~ lack of appreciation of the condi-
ions attending the construction of
hips. but moro by the general condem-
lation of methods on the part Of some
Important witnesses who INDUCED in
weeping criticism without ascertain
nent of the facts.
This statement Is not offered as a
indication Of either the shipping board
r the fleet corporation, but il does, |
N''N''' tpsNlhlt's Ttlult lUt 1Hlkp ana
Irresponsible statements of one of your
principal witnesses. and it contains
ono observations and suggestions that
nay prove of value.
Submarine Evil Discussed
The statement then takes up the
ubmnrine evil. 1t says:
Tho submarine sinkings were meas
red each month with the output of
,hgllSh and American shipyards, and
he public impaticnce grew TO a fever
cat at tho appalling difference. Two
urcesSive administrations in the con-
,ructlon division SucCumbcd to public
Iamnr before the end of 1917.
Construction work did not begin in
arncst until July, 1917. and submarine
inkings averaged $50, 900 tons nor
lonth, English output 200 900 tons pcr
1ontb. and the output of American
ards from July / to December /. 1917.
ias forty mine vessels of 301 900 tons,
. In the first six months of 1918 our
reduction rose TO 169 vessels of 1 ,0S6.
90 tons, and in the two months before
he armistice we delivered rs Ships of
$1,000 tons, or at the rate of / 600,
% tons per year. eight times the out
ut of the preceding year. And we
ad to create our own yards and facili.
les to do it. i
Misstatements Corrected
Another gross misstatemcnt of facts /
n the part of Mr.. Gllen is. that there ,
as no record of S240, 600, 900 Of mort
ages and other securities belonging TO r
le fleet corporation. He says they /
ere afterwards found in n trust COM =
any in Philadelphia. 4
The facts are these: The securities +
nnpStinn In, kn = | :
10 treasurer in Washington until April ,.
I, 1919, when the trustees of the !,
jroration passed resolution author
ing the transfer of these securities TO
le custory of Comptroller Bender in !,
On May 2G, 1910, the i
'ard of trustees passed a resolution
'ntrming action of Mr.. Bender in Il
nting safe deposit box in the Girurd u
rust 60, Of that city. On July 0, q
'lo, the trustees transferred the Gus L
dy of these securities TO II. Edward &
ew, assistant comptroller, who has v
special register of them [
was from this register that the list h
'pcaring in Mr.. Gillcn's testimony b
aS prepared. il
"Mr. Gillcn states: There was no II
cord in the treasurer Office of the @
any millions in trust funds-how [,
any millions ! don't know. 1t must q
I've run to two or three hundred mil il
N doltar of imprcst funds in the p
ndS of contractors in the ship build
& districts of the country
ut is strange that Mr.. Gillcn, oc-
pying the position Of assistant to
ldge Payne, president of the Finer L
ncy Fleet Corporation, should, during Fl
incumbcncy Of ton months, have il
en- unconscious Of the fact that there I,
nrc monthly balance sheets in the divi- il
On Of construction. that these bal +
LNn hhCnln Sh0Mnl Ihn nmnunts Of hnn- II