Evening star., 1944-03-04
Letters to The Star
Cites Gains and Losses in
New War Profits Act.
ro the Iditor Of The star:


the Senate. It is compromise, but.
hasten to say, very good one, consid-
ering the tremendous pressures to which
the members of Congress were subjected
improvement over the current one in
many significant matters quite apart
from detail. And since am going to
criticize little later, it would be we'll
to point out first the good results which
can be obtained from the new bill.
First of these is the establishment Of
war contracts price adjustment board
as the top authority over the agencies
heretofore renegotiating. The official
status of the new board is of tremend-
GUS possible benefit in classifying and
unifying policy and procedure. Further,
it makes possible the throwing out of
the crippling and stupid service pro-
cedures which have snarled past opera
tlons. Now the job really could be done
as a business job should be done. II
the board does not delegate" to the
secretaries (and chairmen) too great
latitude, much will be gained. Perhaps
such delegations" should be prohibitive
as we'll as permissive. That is, delega-
tions of authority should be interpreted
narrowly rather than broadly, so that
inapplicable procedures and formalities
cannot be forced on operations which
are better run without them.
Second is writing into the bill definite
considerations which must be taken into
account in the determination of what
constitutes excessive profits" This pro-
vision, coupled with the one requiring
the board to furnish the contractor on
demand bill a. particulars on how his
settlement was arrived at, can have a
most salutary effect upon the whole
operation. Though not as specific as
the language might have been, this
combination nevertheless will go far to
eliminate past arbitrariness and capri
ciousness.
Third is the right of appeal to the
tax court granted to the contractor
agrieved by an order of the board as
distinguished from an agreement mu-
tually arrived at This is in accord with
our national traditions.
Fourth is the requirement placed upon
contractors to file necessary information
directly with the board This places the
responsibility for compliance upon the
contractor instead of upon the board.
1t will eliminate the just complaint of
those who felt in the past that they
were caught while their competitors
escaped very imperfect dragnet.
Fifth Is the clearly defined power OF
the board to compel submission of
needed data so that the relatively few
for whom public opinion and decency
are not sufhcient motives may not have
an undue advantage over their betters
To my mind, the above are the
significant improvements in the bill in
the larger field of policy. There are
number of others of the more detailed
procedural type which will tighten up
the operation and make 1t much more
shipshape for all concerned.
This brings me to what still appear
to be certain weaknesses in the cur
rent bill.
First Of these is the raising of the
limit under which a business volume is
not renegotiable from Sl00 900 to $780,
600 yearly volume. This will allow nu-
merous real 'profiteers" in any sense
OF the word to retain most of their
unWarranted gains and give them an
unfair advantage over others Further,
1t will make involuntary "profteers" Of
those who have no such intentions for
1t Is too much to expect voluntary re-
funds Of clearly excessive profits when
others get away with it," There is
ample proof that excessive profits exist
IN business volumes below $500, 1000
and even below $4,000 for that mat
ter. However, both houses of Con-
gress had set the higher figure and
SO the excellent compromise committee
could not correct this defect on its own
motion
The same reason probably accounts
for the greatest Shortcoming of the bill
There is no broadening of scope amongst
business fields to which renegotiation
is to be applied. AS stated in an earlier
article, there is no reason why the fight.
fly, float type of war production should
not make excessive profits while the
shirt, shoe and soda-pop maker is al
lowed to reap an unwarranted harvest
from the same catastrophe of total war.
This puts premium on Sinking pro-
duction needed directly for battlefront
use. 1t leaves the renegotiation process
discriminatory one; and, worse yet,
places q penalty on those contributing
most to the direct winning OF the war
in relation to those who contribute
least. The scope Of the act should be
expanded by amendment If need be to
all business doing volume greater
than in peacetime years.
Last, but not least, is an imperfection
which probably is also due to the neces-
sity for compromise. The War Con-
tracts Price Adjustment Board is Gre
ated by Title VII as the top authority
In renegotiation. Then this essential
SIlrrpnoany ic ionno rIi i1oI ~,
ton of the personnel constituting the
board! For the members are to be
appointed by the secretaries Cor chair
mem OF the agencies which heretofore
have had the authority-and are to be
omcers or employees" of such agencies
and shall not receive additional COM
pensatlon." Well, che who pays the
fiddler calls the tune!" The appoint
ing power may be left where the act
proposes; though it would better be
nominating power with appointment
by the President. The bill should pro-
vide independent compensation for the
board members just as it does for SUBJ
ordinate personnel. This is vitally i'm
portant, for it is obviously impractical
to have an Officer or employe" of one
OF the secretaries Cor chairmen)," act
ing as board member, delegate" DOW
erS, functions or duties to the same
authority which has appointed him.
This carries the Checks and balances"
of our form Of government close to an
absurdity. E. STARKE
CindereIIo's Slippers
NoW out upon the rfalist
Whose ScOrntul lips haze neper kissed