Evening star., 1947-08-04
Senator 1obey Score.
Suppressed Report
On Loan 10 B. & @,
BY ths Asseeiotsd Press

The weeks-long controversy
earlier this year over an $780,
100000 loan the Baltimore L.
Ohio Railroad arranged with the
Reconstruction Finance Corp.
flared anew today with a call
from Senator Tobey, Republican,
OF New Hampshire for publica-
ton OF a suppressed" congress
sional subcommittee report.
Senator Tobey, chairman OF the
Senate Banking Subcommittee
which conducted hearings into the
railroads financing last spring, con-
tended that unusual" and "un-
ethical" efforts by B. d o. and RFC
omcails helped keep the document
secret.
RFC Chairman John D. Goodloe
replied that he had asked members
not to sign the report until they
had studied it carefully because
1t covered ground already passed
on by Federal court.
The hearings by Senator Tobey's
group revolved around an agree
ment by the RFC to extend its
B. & o. loan from 1914 to 1865.
Testimony brought charges and
denials that the RFC engineered =
fraudulent bankruptcy" of the
B. IL o.
Tentative Report Drafted.
The inquiry was recessed carly In
May with tentative plans for a re-
opening later. Meantime, q tenta-
tive report was drafted.
Senator Tobey's demand for its
immediate publication followed
weekend reports that the subcom-
mittee had met in his absence
shortly before Congress recessed
last month and decided against re-
leasing the findings.
From his home at Temple, N. H.,
last night. he wired other members
Of the subcommittee that his wife's
illness took him from Washington
Nv cA2O dQOSO.
II had no notice of the meeting
although I am advised that Recon-
finance officials had ad-
vance notice and were outside
the committee room in advance of
and during the meeting.
Against Withholding Report.
Had I been present, would of
course have fought any move to
keep the contents of the report from
the taxpayers who have, through
the Reconstruction Finance Corp,
$50, 100000 of their money in the
hands of the Baltimore 81 Ohio tied
up in long term loan.
Il am advised that despite the
fact that the American people have
been deprived Of knowledge OF the
contents of the report, yet certain
Baltimore g. Ohio and Reconstruct
ton finance Corp. officials gained
access thereto, and attempted by
unusual and, IN my opinion, un-
ethical means to keep its contents
from being made public.
"As chairman of the subcom-
mittee resent the tactics employed
by the railroad and by the govern
mental agency representatives and
I will not play into their hands by
concealing the report from the
people.
Accordingly, I propose that the
report be made available to the
press at once"
In Washington Mr.. Goodloe,
commenting to reporter on Sena-
tor Tobey's telegram, said:
II was reliably advised that In
the closing days Of the Congress
Mr.. Tobey had sent down here q
72-page report on the subcom-
mittee's inquiry into RFC financing
Of the B. & O., questioning legality
of the transaction on the same
grounds that had been passed on
by the court in which the line was
reorganized.
IT wrote q letter to every mem
Der Of the subcommittee pointing
out that in the rush of the session.
end they were unlikely to be able to
read such document, much less to
form a considered opinion on 1t, and
urging them not to sign such
report unless they had studied it
and concluded they agreed with it.
IT that Is unethical, I plead
guilty"
In Baltimore, r. B. White, presi-
dent Of the railroad, declined COM
ment.