COMMITTEE ON SMALL BUSINESS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP78-03985A000900040012-2
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 5
• Document Creation Date: December 12, 2016
• Document Release Date: November 19, 2001
• Sequence Number: 12
• Publication Date: February 3, 1953
• Content Type: OPEN

Approved Foggy
Hunter
Hyde
Ikard
Jackson
James
Jarman
Javlts
Jenkins
Jensen
Johnson
Jonas, Ill.
Jonas, N. C,
Jones, Mo.
Jones, N. C.
Judd
Karsten, Mo.
Kean
Kearney
Kearns
Keating
Kelley, Pa.
Kelly, N. Y.
Keogh
Miller, N. Y.
Mollohan
Morano
Morgan
Morrison
Moss
Multer
Mumma
Neal
Nelson
Nicholson
Norblad
Oakman
O'Brien, Ill.
O'Hara, 111.
O'Hara, Minn.
O'Neill
Osmers
Ostertag
Passman
Patman
Patten
Patterson
Kersten, Wis. Pelly
Kilburn Perkins
Kilday Pfost
King, Calif. Philbin
King, Pa. Phillips
Kirwan Pillion
Klein Poage
Kluczynski Poff
Knox Polk
Krueger Poulson
Laird Powell
Landrum
Lane
Lanham
Lantaff
Latham
LeCompte
Lesinski
Long
Lovre
Lucas
Lyle
McCarthy
McCormack Rhodes, Ariz.
McCulloch Rhodes, Pa.
McDonough Richards
McIntire Riehlman
McMillan
McVey
Machrowicz
Mack, Ill.
Mack, Wash.
Preston
Price
priest
Prouty
Badwan
Rains
Ray
Rayburn
Reams
Reed, Ill.
Reed, N. Y.
Rees, Kans.
Rivers
Roberts
Robeson, Va.
Itobsion, Ky.
Rodino
Madden Rogers, Colo.
Magnuson Rogers, Fla.
Mahon Rogers, Mass.
Mailliard Rogers, Tex.
Marshall Rooney
Martin, Iowa Roosevelt
Matthews Sadlak
Meader St. George
Merrill Saylor
Merrow Schenck
Metcalf Scherer
Miller, Calif. Scott
Miller, Md. Scrivner
Miller, Nebr. Scudder
NAYS-5
Secrest
Seely-Brown
Selden
Shafer
Sheppard
Short
Shuford
Sieminski
Sikes
Simpson, Ill.
Simpson, Pa.
Small
penc
prijy
Stanley
Steed
Stringfellow
Sullivan
Sutton
Taber
Talle
Taylor
Teague
Thomas
Thompson, La.
Thompson,
Mich.
Thompson, Tex.
Thornberry
Tollefson
Trimble
Utt
Van Pelt
Van Zandt
Velde
Vinson
Wainwright
Walter
Wampler
Warburton
Watts
Weichel
Westland
Wharton
Wheeler
Whitten
Wickersham
Widnall
Wier
Wigglesworth
Williams, N. Y.
Willis
Wilson, Calif.
Wilson, Ind.
Wilson, Tex.
Winstgad
Withers
Withrow
Wolverton
Yorty
Young
Younger
Zablocki
Mr. Harrison of Wyoming with Mr. Shelley.
M. O'Konski with Mr. Moulder.
Mr. Reece of Tennessee with Mr. Donohue.
Mr. Stauffer W'th Mr. Fogarty.
The re of the vote was announced
as al vo ecorded.
COMMITTEE ON SMALL BUSINESS
Mr. LATHAM. Mr. Speaker, I call up
.House Resolution 22, and ask for its im-
mediate consideration.
The Clerk read the resolution, as
follows:
Resolved, That, effective January 3, 1953,
there is hereby created a select committee
to be composed of 11 Members of the House
of Representatives to be appointed by the
Speaker, one of whom he shall designate as
chairman. Any vacancy occurring in the
membership of the committee shall be filled
in the manner in which the original appoint-
ment was made.
The committee is authorized and directed
to conduct a study and investigation of the
problems of small business, existing, arising,
or that may arise, with particular reference
to (1) whether the potentialities of small
business are being adequately developed and,
if not, what factors have hindered and are
hindering the normal operation of estab-
lished small business and/or its development
and enterprise; (2) whether agencies, depart-
ments of the Government, or Government-
owned or controlled corporations are prop-
erly, adequately, or equitably serving the
needs of small business; (3) whether small
business is being treated fairly and the
public welfare properly and justly served
through the allotments of valuable materials
in which there are shortages, in the granting
of priorities or preferences in the use, sale,
or purchase of said materials; and (4) the
solution of the problems of small business
during the continuance of the existing na-
tional emergency.
The committee may from time to time
submit to the House such preliminary re-
ports as it deems advisable; and prior to
the close of the present Congress shall sub-
mit to the House its final report on the
results of its study and investigation, to-
gether with such recommendations as it
deems advisable. Any report submitted
when the House is not in session may be
filed with the Clerk of the House.
For the purposes of this resolution the
committee, or any subcommittee thereof, is
authorized to sit and act during the present
,Congress at such times and places, whether
or not the House is sitting, has recessed, or
has adjourned, to hold such hearings, to
require the attendance of such witnesses and
the production of such books, papers, and
documents, and to take such testimony,
as it deems necessary. Subpenas may be
issued under the signature of the chairman
of the committee or any properly designated
chairman of a subcommittee thereof, or any
member designated by him, and may be
served by any person designated by such
chairman or member. The chairman of the
committee or any member thereof may ad-
minister oaths to witnesses.
Mr. LATHAM. Mr. Speaker, I yield
30 minutes to the gentleman from Vir-
ginia [Mr. SMITH].
Mr. Speaker, I do not think that this
resolution requires any extended debate
or discussion. It is merely an extension
of the Small Business Select Committee
of the House. The provisions are exactly
the same as those that were written into
the law last year.
time,
Mr. SMITH of Virginia. Mr. Speaker,
as the gentleman from New York has so
aptly said, this resolution merely extends
the Small. Business Committee that has
been in operation in the last several Con-
gresses.
I have no requests for time over here.
I think the House is unanimously in fa-
vor of this committee. If the gentleman
from New York desires to move the pre-
vious question, I yield back the balance
of my time.
Mr. LATHAM. Mr. Speaker, I yield
3 minutes to the gentleman from New
Jersey [Mr. CANFIELD].
Mr. CANFIELD. Mr. Speaker, it gives
me a great deal of pleasure to add my
voice in support of House Resolution 22
reestablishing the Select Committee on
Small Business of the House of Repre-
sentatives. This committee, in my opin-
ion, has performed outstanding service
for the small businessmen of the United
States. The work of the Small Busi-
ness Committee on the materials prob-
lem alone would warrant its reestablish-
ment by this House. In fact, the com-
mittee has not only rendered yeoman
service in the solution of the problems of
small business in the field of materials
but has performed equal service in prac-
tically every phase of business activity.
Whether the problem be one of securing
a fair share of Government contracts, or
whether it be financing, or whether it
be an effo t to secure equality, of oppor-
tunity and basic justice in the problems
of small business, the Small Business
Committee has never faltered in its ob-
jective to render maximum service.
I would like to call the attention of this
House to the work of the Small Business
Committee in the field of economic con-
trols set up under the Defense Produc-
tion Act. The field hearings of the com-
mittee provided a forum for small-busi-
ness men when no other competent
forum was available. The Small Busi-
ness Committee, I believe, held some
thirty-odd hearings in every geographi-
cal section of our country. The hearings
were informal and provided an atmos-
phere of friendliness and cooperation
which the small-business man welcomed
enthusiastically. Here he was able to tell
of his problems in connection with price
controls, wage controls, salary controls,
materials controls, credit controls, or any
other problem which impeded his prog-
ress in the business world. These hear-
ings were not empty gestures. The com-
mittee came back to Washington and
started to work on the problems present-
ed at the hearings. I know first-hand
that the record was carefully analyzed
and that the problems were taken up
with the appropriate agencies and that
recommendations were made to the Con-
gress, many of which were enacted into
law. I know of this first-hand because
of my many, many contacts with the
committee, and I have been greatly
pleased with the thorough and business-
like manner in which the committee
tackled the problems of small business.
Hebert Mason
NOT VOTING-38
Abbitt Fernandez O'Brien, N. Y.
Barden Fogarty O'Konski
Barrett Green Rabaut
Bonner Harrison, Wyo. Reece, Tenn.
Boykin Jones, Ala. Riley-
Buckley Kee Sheehan
Chelf McGregor Shelley
Chiperfield Miller, Kans. Stauffer
Cooley Mills Vorys
Dondero Moulder Vursell
Donohue Murray Wolcott
Durham Norrell Yates
Ellsworth O'Brien, Mich,
So the bill was passed.
The Clerk announced the following
pairs
Mr. Chiperfield with Mr. Cooley.
Mr, McGregor with Mr. Riley.
Mr. Vorys with Mr. Yates.
Mr. Sheehan with Mr. O'Brien of New York.
Mr. Dondero with Mr. Rabaut.
Mr. Wolcott with Mr. Buckley.
Mr.. Vursell With Mr. Green.
Mr. Ellsworth with Mrs. Kee.
?
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Now, may I inject a more personal
equation into this statement. I have, as
TABLE 1.-Size of firms according to number
of employees (1947)
I know a majority of the Members of
this House have also done, called upon
the Small Business Committee for help
on the individual problems of many of
my small-business constituents. It has
been a source of gratification to me to
-find that these individual problems re-
ceived immediate and intelligent atten-
tion. In every instance when I have
called upon the committee for assistance,
it has been rendered cheerfully and with
a degree of promptness that was most
commendable. Moreover, in practically
every instance a solution for the individ-
ual problem was found.
As I stated in the beginning of these
remarks, Mr. Speaker, I am more than
happy to add my voice in support of
House Resolution 22. I wish the Select
Committee on Small Business of the
House of Representatives in the Eighty-
third Congress. every success. Many
problems of small business are continu-
ing ones and need the ever-watchful eye
of this committee to secure the proper
treatment for the small-business man
everywhere. I have every confidence
that the committee will accept its re-
sponsibilities and perform its duties in a
manner which will reflect credit upon
the entire membership of this House. '
(Mr. CANFIELD asked and was given
permission to revise and extend his
remarks.)
Mr. LATHAM. Mr. Speaker, I yield
such time as he desires to the gentleman
from Colorado [Mr. HILL].
Mr. HILL. Mr. Speaker, the Select
Committee on Small Business is pri-
marily a service committee which coop-
erates with Members of Congress in solv-
ing individual problems of small business
firms arising in the various districts.
This program not only assists the-mem-
bers but enables the committee to secure
a cross-section picture of the problems
which affect all small business.
The Select Committee on Small Busi-
ness, in its final report in the Eighty-
second Congress, has stated the concept
of small business and many of the prob-
lems confronting persons engaging in
small business today. From that report
I have extracted the following remarks-
I am sure the membership of the House
will :find them interesting:
The great majority of American business
firms, are small. Excluding agriculture, the
Bureau of Census estimated that there were
at the close of 1951 a total of 3,991,200 busi-
ness firms in operation in the United States.
Of these, approximately 1,686,000 were in
retail trade; 855,000 were in service indus-
tries; 366,000 were in construction; 349,000
were In finance, insurance, and real estate;
303,000 were in manufacturing; 204,000 were
in wholesale trade; and the remainder were
In mining, transportation, communications,
and miscellaneous industries.
On the basis of 1939 figures, only 3.5 per-
cent of the retail stores had annual sales in
excess of $100,000. More than half had sales
below- $10,000. Over 1,600,000 units, 91 per-
cent of the total, employed fewer than 100
persons. Only about 100,000 of these firms
were incorporated.
In manufacturing, the distribution in 1947
of 240,881 firms according to number of
employees was as follows:
Number of
employees
Number
of estab-
lishments
Number
of em-
ployees
(000)
1 to 4____________
6 to 9--_________
10 to 19__-_______
20 to 49_-________
50 to 99_--_______
100to 249_______-
'l50 to 499___-____
500 to 999_______-
1,000 to 2,499____-
2,500 and'over----
70,384
46,622
40,045
40, 016.
18, 672
14, 323
5, 555
2,729
1,431
504
240, 881
101.0
310.9
561. 9
1,243.8
1,300.8
21228.7
1,929.9
1, 869.4
2,146.1
2,541.8
Nwn-
her of
estab-
lish-
ments
Num-
her of
em-
ployees
29.2 1.1
19.4 2.2
10.9 3.9
10.6 8.7
8 9.1
0.9 15. 0
2.3 13.5
Li 13.1
6 15.0
2 17.8
103.0 100.0
NOTE.-The number of employees shown is an average
for the year.
Sources: Bureau of the Census; computations by the
Conference Board.
It thus appears that only about 500 firms,
two-tenths of 1 percent of the total, em-
ploy 2,500 or more persons. Only about-
4,200 firms employ 500 or more. These con-
stitute only about 2 percent of the total.
MILITARY PROCUREMENT
There is a strong tendency in a period of
industrial mobilization for Government pro-
curement to favor the large firm. over the
small. During World War II, 51 percent
of all prime Qpntracts went to 33 corporations,
each of which received $1,000,000,000 or more.
The need for large physical resources, engi-
neering skill, ability to experiment, and over-
all productive capacity encourages the utili-
zation of the larger firms. Procurement of-
ficials follow the line of least resistance and
concentrate the placing of contracts with a
few large producers and allow the prime con-
tractors to deal with the smaller concerns
on a subcontracting basis. The larger-con-
cern is in addition much better equipped
to handle negotiations with the Government
than the small enterprise.
This tendency to utilize the large concern
has many indirect effects that work to the
hardship of small business. New plants are
built and existing facilities expanded under
especially favorable ' circumstances, fre-
quently at Government expense. In World
War II the 250 largest corporations operated
79 percent of all new plant facilities built
with Federal funds and operated by private
industry. The prime contractor is given
first claim to scarce materials which he doles
out to his subcontractors. Asquisition of
new capital is facilitated by Government
loans. Virtually every aspect of Government
procurement during periods of defense mo-
bilization imposes undue hardships on small
business.
PRICE AND WAGE CONTROLS
The controls necessary to mobilize indus-
try effectively also frequently place small
business at a competitive disadvantage. It
is very difficult to avoid leaving scars on our
economy, the deepest of which appear on
small business. Regulations such as those
controlling prices, wages, and the utilization
of scarce materials are themselves violative of
the principles of free enterprise. The fact
must never be forgotten that although they
may be necessary for the safety of the court-
try, they do mean a definite even though
temporary departure from free competition.
Unless great care is exercised in framing
regulations, therefore, serious damage may
be done to small business. Many instances
can be cited to illustrate this. Numerous
price regulations, for instance, have con-
tinued unfair trade practices in determining
prices. The dangerhere is in perpetuating
February
what can become a serious threat to com-
petition. Again, several price regulations
have endorsed follow-the-leader practices.
In fact, the general ceiling price regulation
ties the price of a seller of new commodities
to those of the most closely competitive
seller. Several regulations have established
ceilings on the basis of maintained resale
prices. Unless price relationships are care-
fully adjusted, price squeezes appear at vari-
ous stages of the 'productive process.
SCARCE MATERIALS
Likewise in the area of control of ma-
terials, the small firm is placed in Jeopardy.
The basic fact is that a free market in these
materials ceases to exist once an elaborate
scheme of control such as the Controlled
Materials Plan is instituted. Furthermore,
the practice of channeling many materials to
subcontractors through prime contractors
gives the latter the power of life or death over
the small-business man who becomes de-
pendent on his large prime contractor for
the materials necessary to remain in oper-
ation, Unless checked, material controls
generally encourage integrated operation, af-
filiations with large concerns, and favoritism
in the placement of orders. All of these en-
hance the power of the large suppliers.
TAXATION
In normal times the typical small firm
depends upon the savings of the owner for
its inception and upon the earnings of the
company for future development of the
business. The impact of high tax rates on
current business earnings has not only af-
fected the operating position of the small
concern with regard to the defense period,
but may impair its future status. The high
surtax on low levels of corporate earnings
and the excess profits tax have hindered
small concerns in their accumulation of suf-
ficient funds from profits to finance work-
ing capital and investment requirements.
In many ways the small business bears a
greater tax burden than the large concern.
While some recognition has been made in
the tax laws of the financial difficulties of
small business, additional revisions are
needed to erase tax inequities and to remove
the relatively large tax burden imposed on
small enterprises.
SMALL BUSINESS AND THE COMPETITIVE SYSTEM
The essence of the American economic sys-
tem of private enterprise is free competition.
Only through competition can a free market,
free investment opportunity, free entry into
industry-in a word, free enterprise-survive.
This has long been the basic principle of
American governmental policy toward indus-
try and was stated succinctly in a recent
Supreme Court opinion, which said, "The
heart of our national economic policy long
has been faith in the value of competition."
Competition is the basic regulator of eco-
nomic activity and the only device that en-
ables us to avoid complete governmental
regimentation.
Small-business enterprise prolddes the
most fertile soil in which healthy competi-
tion may flourish. Small and independent
business supplies the strength and vigor so
necessary to the growth of our competitive
forces. There is no better assurance of'our
ability to maintain competition than a flour-
ishing community of small and independent
business enterprises. Any development
which makes it more difficult for efficient
small firms to survive strikes a blow at
competition.
Just as small business provides a favorable
economic climate for the development of
healthy competition, so competition is the
greatest safeguard for small business. Small
business needs freedom of entry into new
industries and occupations. It demands
freedom to start and freedom to grow. It
is dependent on personal initiative and the
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Individual judgment of its owner. It must
be free of controlled prices and restrictive
practices of all kinds.
LEGISLATION AFFECTING SMALL BUSINESS
As the role of Government becomes. more
and more intimately connected I with the
operation of American business, the impor-
tance of Federal agencies concerned with
small business has proportionately increased.
Today the Reconstruction Finance Corpora-
tion, the Small Defense Plants Administra-
tion, the National Production Authority, the
Economic Stabilization Agency (OPS, WSB,
SSB), the Defense Production Administra-
tion and the Munitions Board, among others,
are affecting the operation of every small
business, and especially so if a particular
business deals with the Government in its
tremendous- procurement program.
Through the years the Congress has taken
a direct and specific interest in small busi-
ness and its problems, dating back to the
earliest tariff laws and to such fundamental
antitrust legislation as the Sherman Act of
1894: Over 80 bills were introduced in the
Eighty-second Congress having a direct bear-
ing on antitrust, monopoly, or small busi-
ness. That this Congress saw fit to con-
sider very few of the proposals presented to
it, and to actually enact even fewer, does pot
necesasrily indicate it disinterestedness on
the part of Congress nor a lack of impor-
tance of the measures themselves. But it
does indicate that many problems worthy of
solution remain unsolved,
(Mr. HILL asked and was given per-
mission to revise and extend his
remarks.) .
Mr. LATHAM. Mr. Speaker, I yield
such time as he may desire to the gen-
tleman from Colorado [Mr. CHENO-
WETH1.
Mr. CHENOWETH. Mr. Speaker, I am
happy to support the resolution continu-
ing the Select Committee on Small Busi-
ness. I feel that this committee in past
years has done a good job and there is
a definite need for its activities at the
present time.
I am happy and proud to note that
my distinguished colleague from Colo-
rado [Mr. HILL] is to be the new chair-
man of this important committee. Mr.
HILL has served on this committee for
many years and has been a most active
and prominent member. I am sure that
under his able direction this committee
will be of eyen more service to the small-'
business man of the country.
It should be obvious to everyone that
the small-business man is in need of all
of the assistance we can give him. Dur-
ing a period like this, when huge pur-
chases are being made for our military
services, it is natural that most of these
purchases are made from large com-
panies, It is much easier for a procure-
ment officer to make a purchase from
one company, than it is to buy the same
amount from 10 small companies. How-
ever, in the interest of protecting the
economy of our Nation, I feel that more
attention should be given to the small
concern so that he may participate in
this program. I am hoping that the
committee will give more study to this
problem in the coming months, to the
end that the smaller contractors and in-
dustrial plants may receive a greater
share of the defense purchases.
(Mr. CHENOWETH' asked and was
given permission to revise and extend his
Mr. 'GROSS: Mr. Speaker, I rise in
support of the resolution.
According to latest official figures, 100
large, favored corporations have cor-
nered 62 percent of the dollar value of all
military contracts let in the continental
United States.
At the tail end of this situation, small
business is receiving only 19 to 24 percent
of the dollar value of such military con-
tracts.
. These official figures document the vir-
tual freeze-out of small business in re-
cent years, . and make clear the need
for a watchdog committee in the interest
not only of small business but of the tax-
payers.
Look at Munitions Board Report 3-A.
Here we see that an astounding average
of about 80 percent of the. dollar value
of all military contracts are negotiated
or cost-plus instead of let on a com-
petitive basis. As I have said before in
this House, how can the taxpayers obtain
dollar-for-dollar value, much less any
bargains, without competitive bidding?
If the House Select Committee on
Small Business can channel into com-
petitive bidding even one fair-sized con-
tract, slated to be dished out on a juicy
negotiated or cost-plus basis, it will save
so much, over and above the cost of its
existence under this resolution,. that it
will amount to a gilt-edge investment
for the taxpayers.
Let us keep this committee in business,
and, in so doing, provide at least an op-
portunity to derail some of these nego-
tiated, cost-plus gravy trains which
make hamburger out of small business
and the taxpayers.
Mr, LATHAM. Mr' Speaker, I move
the previous question on the resolution.
The previous question was ordered.
The resolution was agreed to.
A motion to reconsider was laid on
the table.
The SPEAKER. Pursuant to the pro-
visions of House Resolution 22, Eighty-
third Congress, the Chair appoints as
members of the Select Committee To
Conduct a Study and Investigation of
the Problems of Small Business the fol-
lowing Members of the House: Mr. HILL,
Colorado, chairman; Mr. RIEHLMAN, New
York; Mr. SEELY-BROWN, Connecticut;
Mr. MCCULLOCH, Ohio; Mr. SHEEHAN, Illi-
nois; Mr. Ho4MER, California; Mr. PAT'-
MAN, Texas; Mr. EvINS, Tennessee; Mr.
MULTER, New York; Mr. YATES, Illinois; mous-consent request, I take it that un-
Mr, STEED, tklahoma. 'der a reservation of objection with re-
spect thereto brief remarks might be
PROVIDING FOR, AN UNDER SECRE- made and extensions of remarks might
be made if that be deemed desirable.
TARY OF STATE (FOR ADMINIS- Mr. RICHARDS. Mr. Speaker, I just
TRATION) want to point out that there is no disk-
Mr. SMITH of Wisconsin. Mr. Speak-
er, I move that the House resolve itself
into the Committee of the Whole House
on the State of the Union for the con-
sideration of the bill (S. 243) to amend
Public Law 73, Eighty-first Congress,
first session (63 Stat. 111), to provide for
an Under Secretary of State (for Ad-
ministration).
The Clerk read the title of the bill.
Mr. fIALLECK. Mr. Speaker, will the
gentleman withhold his motion for a without prolonging debate, I will cer-
moment? tainly be willing to cooperate.
819
Mr. SMITH of Wisconsin. Yes.'
Mr. HALLECK. Mr. Speaker, I ask
unanimous consent to address the House
for 1 minute.
The SPEAKER. Is there objection to
the request of the gentleman from In-
diana?
There was no objection.
Mr. HALLECK. Mr. Speaker, the
matter that is before us is here under a
unanimous-consent agreement entered
into the other day for the considera-
tion of the measure under the ordinary
rules of the House. Unless there are
Members who desire to make some re-
marks in respect to this bill, it occurs
to me that, since the bill, as I understand,
was unanimously reported by the Com-
mittee on Foreign. Affairs, it could be
passed under a unanimous-consent re-
quest for its immediate consideration.
Mr. SMITH of Wisconsin. I have no
objection to that procedure. The bill
was unanimously reported by the Com-
mittee on Foreign Affairs. It relates to
the authorization of the appointment of
an Under Secretary of State.
Mr. HALLECK. I see here the gentle-
man from South Carolina [Mr. RICH-
ARDS], who I know, is interested in the
matter. He is the ranking Democrat of
the committee. - I wonder if he would
express his wishes in respect to the mat-
ter. I would assume, of course, Mr.
Speaker, that anyone desiring to extend
his remarks in connection with this
measure could extend them at this point
in the RECORD.
- Mr. RICHARDS. I have no disposi-
tion to object to such a unanimous-con-
sent request.
Mr. RAYBURN. Why does not the
gentleman from Indiana make a unani-
mous-consent request that the bill be
considered in the House as in the Com-
mittee of the Whole. That would obvi-
ate the rule matter, and anyone who de-
sires to offer an amendment by way of.
striking out the last word would be able
to do so in the House as in Committee
of the Whole, and it would obviate gen-
eral debate also.
Mr. HALLECK. May I say to the gen-
tleman from Texas, if we adopted that
procedure, although I take it there would
be no objection if someone would object,
then we would be faced with the necessity
of keeping 218 Members here in order to
maintain a quorum. If I put the unani-
position on my part as ranking minority
member of the Committee on Foreign
'Affairs to oppose this bill, but I do feel
that the House should know what it is
doing. I feel that the House should be
informed as to the action taken by the
Committee on Foreign Affairs and why
our committee took that action because
this is a pretty important matter. If
there is any way under regular parlia-
mentary procedure that I can call a few
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 820 Approved For R eb & J f1 MRR CR- 8-030 0900040012-2 February 3
Mr' SMITH of Wisconsin. Mr. Speak- Mr. SMITH of Wisconsin, There You are not setting up a new job. for
er, I renew my motion. would be one additional. $17,500 a year without setting up a whole
The SPEAKER. The question is on Mr. GROSS. How many Assistant new echelon. The gentleman knows
the motion of the gentleman from Wis- Secretaries of State? that.
consin [Mr. SMrrx]. Mr. SMITH of Wisconsin. There are Mr. SMITH of Wisconsin. The testi-
The motion was agreed to. 10. mony we have had does not indicate that.
Accordingly the House resolved itself Mr. GROSS. It is here proposed to Mr. JUDD. Mr: Chairman, will the
Into the, Committee of the Whole House create another Under Secretary of State, gentleman yield?
an the State of the Union for the consid- to be paid $17,500.. How much more in Mr. SMITH of Wisconsin. I yield to
eration of the bill (S. 243) to amend Pub- clerical help will be asked to support the gentleman from Minnesota..
lie Law 73, Eighty-first Congress, first this office? Mr. JUDD. Was not the testimony
session (63 Stat. 111), to provide for an Mr. SMITH of Wisconsin. No more. before our committee that the new Sec-
Under Secretary of State (for Adminis- As a matter of fact, the office of Ambas- retary said that the Secretaries were so
tration), with Mr. KEATING in the chair. sador at Large which Mr. Jessup held harassed by administrative matters that
The Clerk read the title of the bill. has been abolished. That was a $25,000 they did not get , chance to study mat-
By unanimous consent, the first read- job. This position pays $17,500, so that ters of organization, which is the first
ing of the bill was dispensed with. from a monetary standpoint we are sav- job we want to think about; for efficiency.
Mr. SMITH of Wisconsin. Mr. Chair- ing money on this operation. He asked for this man temporarily to go
man., I will not take up much of the time Mr. GROSS. So that by the creation in there and take a fresh look at the De-
of the Committee except to explain the of this job and by the elimination of partment. He was convinced that if this
bill briefly. This matter is before us in the other job we would be saving the were done, we could reduce many opera-
the form of a bill passed by the other magnificent sum of $5,000, approxi- tions of the Department. If personnel in
body. It was passed by the Committee mately? the Department is to be reduced, an ex-
on Foreign Affairs with an amendment. Mr. SMITH of Wisconsin. It is a pert should be brought in to make a care-
This bill amends Public Law 73 of the saving. ful study, rather than depend on people
Eighty-first Congress to authorize the Mr. GROSS. A very small saving. who are involved in it to clean up them-
appointment by the Secretary of State Mr. SMITH of Wisconsin. I think this selves.
of an Under Secretary of State for Ad- is a position that should be created to Mr. SMITH of Wisconsin. That is
ministration. There would be the See- insure more efficient administration. exactly right. Testimony before or com-
retary of State, the Under Secretary, and Mr. GROSS. I will say to the gentle- mittee showed that the Secretary was so
then this additional Under Secretary. man that I thought. the Republican Party absorbed in policy questions that he could
His responsibility would be comparable to was out to eliminate a lot. of jobs instead not study administrative _ programs.
a general manager of the Department. of creating jobs. As far' as I am con- That is the testimony on the part of the
In other words, he would have jurisdic- cerned, I am opposed to it. men who are presently in the Depart-
tion over the personnel, and over the Mr: SMITH of Wisconsin. May I re- ment.
internal operations of the Department. mind the gentleman that the office is for Mr. GROSS. Mr. Chairman., will the
The request for this additional Under 2 years, unless the Secretary determines gentleman yield?
Secretary comes as a result of a condi- that the job has been done before that. Mr. SMITH of Wisconsin. I yield.
tion which has been recognized by the Mr. ROONEY. Mr.,Chairman, will the Mr. GROSS.. Who is the expert who
public over the years, namely, that there gentleman yield? is supposed to be hired to fill this job?
is need for a close look at the organza- Mr. SMITH of Wisconsin. I yield to Mr. SMITH of Wisconsin. I can only
tion and operation of the State Depart- the gentleman from New York. repeat from hearsay: 'A gentleman by the
meat. Mr. ROONEY. I would like to ask the name of Lourie.
What the committee amendment does gentleman whether or not this new em- Mr. JUDD. Donold Lourie, president
is merely to determine the line of suc- ployee at $17,500 a year is to have a sec- of the Quaker Oats Co., in the gentle-
cession. Policy matters will be handled retary or is he to work without one? man's own district.
by the Under Secretary-not the individ- Mr. SMITH of Wisconsin. I suppose Mr. GROSS. In my district, but does
ual who will occupy this new position of he is to have one. being president of the Quaker Oats Co.
Under Secretary for Administration. Mr. ROONEY. How many? qualify him to be Under Secretary of
Among the responsibilities of the new Mr. SMITH of Wisconsin, I do not State?
Linder Secretary will be the review, eval- know. Mr. JUDD. No; but he has demon-
uation, and operation of the loyalty and Mr. ROONEY. Does not the gentle- strated the qualities to be a successful
security programs. He will make a care- man realize that under the provisions administrator of a large establishment.
ful examination of the budget to assure of this pending legislation you are set- Mr. ROONEY. Mr. Chairman, will
that it is adequate but not excessive. ting up a whole new echelon in the State the gentleman yield?
He will assure the coordination of the Department, to do work that was for- Mr. SMITH of Wisconsin. I yield.
Technical Cooperation 'Administration merly done by one man? Mr. ROONEY. Will the gentleman
and the International Information Ad- Mr. SMITH of Wisconsin. Unfortu- assure the House that the filling of this
ministration with related programs of nately it was never done. new position by an officer from Quaker
the Department and with other agencies. Mr, ROONEY. What was never done? Oats is not going to require the employ-
The committee was unanimous in feel- Mr. SMITH of Wisconsin. The De- ment of additional personnal in the De-
Ing that the Secretary of State ought to partment is in a mess. We have heard partment of State to work under him?,
have this additional office. In these crit- all about this mess. Mr. SMITH of Wisconsin. I am go-
Ical days it is necessary for the Secre- Mr. ROONEY. Well, the Department ing to leave that to the Appropriations
tary to be away about 50 percent of the is now in the hands of the gentleman's Committee.
time. In his absence the Under Secre- party. We shall see what mess there is. Mr. ROONEY. But the gentleman
tars is called upon to act in his place. But we are talking about setting up an wants to authorize this man to have a
This second Under Secretary would not entirely new echelon in the State Depart- desk at $17,500 a year to do work that
deal in matters of policy. His will be a ment. May I ask the gentleman whether has been carried on by one man.
purely administrative job. or not this is pursuant to the recom- Mr. SMITH of Wisconsin. He will
Mr. GROSS. Mr. Chairman, will the mendations of the Hoover Commission, have the desk that Mr. Jessup had.
gentleman yield? or whether or not it is contrary to the Mr. RICHARDS. Mr. Chairman, I
Mr. SMITH of Wisconsin. I yield to recommendations made by the Hoover want. to say for the benefit of the com-
the gentleman from Iowa. Commission. mittee that I intend to support this bill.
Mr. GROSS. Does that mean now Aft. SMITH of Wisconsin. I cannot I think the committee knows what it is
that there are only two Under Secre- answer that question because the mat- "doing. I have an idea that if this bill
taries of State? ter was not discussed, but this does not had come up last year you would have
Mr. SMITH of Wisconsin. There is call for more money. It is within the really heard something in this House.
only one. appropriations as they exist today. As a matter of fact, this bill does some-
Mr. GROSS. And there would be one Mr. ROONEY. The gentleman says thing for the new President and the new
additional? the job does not call for more money? Secretary of State, both fine, patriotic
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