Evening star., 1943-01-22
Wallace Hits Conflict
Between BEW and
RFC Subsidiaries
Economic Warfare Unit
Given Control Over All
Imports Except Rubber
BY the Associated Press.

BY the Associated Press.
Vice President Wallace was dis
closed today to have criticized rela-
tions between the Board of Eco
nomic Warfare and Reconstruction
finance Corp. subsidiaries as mot
satisfactory" in letter accompany
ing an order giving BEW control
over all imports except natural rub
Der.
Copies of Mr.. Wallace'S letter, fur
nished to members of the Senate
Banking Committee, prompted Sen
ator Taft, Republican, of Ohio to
urge legislation redefining and linn
iting authority of both the FRC and
the BEW in an effort to end long
standing conflict between the agen-
cies.
The Wallace letter, addressed to
Secretary of Commerce Jones, said
he had re-examined the operating
relationship between the stats of
certain FRC subsidiaries and the Of
fee of Imports of the BEW, of which
he is chairman.
No Clear-Cut Division.
The Vice President said he had
"come to the conclusion that, not
withstanding the best of intentions
of all parties concerned, the present
relations are not satisfactory and a
basic simplification must be made in
the procedures and methods of op-
erations."
The basic difficulty, Mr.. Wallace
continued, was that there was mo
clear-cut division" between the pro-
graming and administration of de-
velopment and procurement projects
on one hand and their financing on
the other. His order limited the
RFC to financing activities on all
except natural rubber, which Rubber
Administrator William Jeffers an
nounced had been turned over to
RF'C under his direction.
Senator Taft said the obvious con-
fiict of authority between the BEW
and RFC in the field of purchasing
vital war materials and buying other
supplies to keep them out of Axis
hands made it apparent to him that
Congress ought to decide which
agency should do the work.
Interpreted as Setback.
The RIGS Rubber Reserve Corps
increased responsibility for negotia-
tions for rubber from abroad was
given to 1t by directive from Mr..
Jeffers.
Previously the BEW had been
IN
of Rubber Reserve Corp. in the pur-
chase and cultivation abroad of
natural rubber needed in this coun-
trys war program.
The switch was made by Mr..
Jeffers, Jeffers office spokesman
said, to centralize authority over the
import rubber program. Mr.. Jeffers'
action was widely interpreted as
setback for BEW and Mr.. Wallace.
The differences between the BEW
and the Jones agencies have been Of
long standing. Adherents of Mr..
Wallace have contended that under
Mr.. Jones the rubber program was
hampered by banker-like caution in
obtaining rubber abroad, while the
Jones camp has replied that the
program was pushed with diligence.
Power to Seek Contracts.
A presidential order was issued |
last April 13 giving BEW power to |
conduct field work and negotiate
contracts, though Mr.. Jones re-
tanned authority to execute the |
documents and disburse funds.
In changing this arrangement, Mr..
Jefferse relied on the authority con-
ferred on him by the recent presi- |
dental directive establishing him as
rubber administrator.
Explaining the move, an associate
Of MIR. Jeffers said that BEW would
continue to prepare studies of DO
tential rubber purchase and culti-
vation programs and would outline
to MIR. Jeffers what it believes could
and should be DONE
Mr.. Jeffers' Office will scan each
program from the standpoint of
feasibility, expenditure of materials
and cost, and if it approves will
issue directive to Mr.. Jones to
proceed with contract negotiations.
Previously such a directive would
have gone to BEW.