EMPLOYMENT OF RETIRED COMMISSIONED OFFICERS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP91-00965R000400280008-9
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 13
• Document Creation Date: December 15, 2016
• Document Release Date: August 27, 2003
• Sequence Number: 8
• Publication Date: April 6, 1960
• Content Type: OPEN

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CONGRESSIONAL RECORD -HOUSE
A motion to reconsider the votes by
which action was taken on the several
motions was laid on the table.
PERMISSION TO SIT-SUBCOMMIT-
TEE NO. 5 OF THE COMMITTEE ON
THE JUDICIARY
Mr. McCORMACK. Mr. Speaker, I
ask unanimous consent that Subcom-
mittee No. 5 of the Committee on the
Judiciary may be permitted to sit on
Wednesday and Thursday afternoon
during general debate.
The SPEAKER. Is there objection to
the request of the gentleman from
Massachusetts?
There was no objection.
CALL OF THE HOUSE
Mr. KLUCZYNSKI. Mr. Speaker, I
make the point of order that a quorum is
not present.
The SPEAKER. The Chair believes a
quorum is not present.
Mr. McCORMACK. Mr. Speaker, I
move a call of the House.
A call of the House was ordered.
The Clerk called the roll, and the fol-
lowing Members failed to answer to their
names :
[Roll No. 411
Addonizio
Edmondson
Morris, N. Mex.
Ashley
Elliott
Passman
Auchincloss
Fenton
Porter
Bowles
Goodell
Powell
Brewster
Granahan
Reuss
Brown, Mo.
Grant
Rhodes, Ariz.
Buckley
Hargis
Rodino
Burdick
Hoffman, Ill.
Rogers, Colo.
Canfield
Jones, Ala.
Rogers,Ma, s.
Casey
Magnuson
Saund
Coffin
Mailllard
Siler
Cooley
Mason
Springer
Curtis, Mo.
Metcalf
Sullivan
Daddario
M'Iler,
Taylor
Dent, Pa.
George P.
Weaver
Diggs
Militken
Willis
Dowdy
Mitchell
Wolf
The SPEAKER. On this rollcall 380
Members have answered to their names,
a quorum.
By unanimous consent, further pro-
ceedings under the call were dispensed
with.
OVERALL LIMITATION ON FOREIGN
TAX CREDIT
The SPEAKER. The unfinished busi-
ness is the question on suspending the
rules and passing the bill H.R. 10087, to
amend the Internal Revenue Code of
1954 to permit taxpayers to elect an
overall limitation on the foreign tax
credit.
The question was taken, and the
Speaker announced that in his opinion
two-thirds had voted in favor thereof.
Mr. GROSS. Mr. Speaker, I demand
the yeas and nays.
The yeas and nays were refused:
So (two-thirds having voted in favor
thereof) the rules were suspended and
the bill was passed.
A motion to reconsider was laid on the
table.
EMPLOYMENT OF RETIRED COM-
MISSIONED OFFICERS
Mr. MADDEN. Mr. Speaker, by di-
rection of the Committee on Rules-I call
No. 63-10
up House Resolution 487 and ask for its
immediate consideration.
The Clerk read the resolution, as fol-
lows:
Resolved, That upon the adoption of this
resolution it shall be in order to move that
the House resolve itself Into the Conunittee
of the Whole House on the State of the
Union for the consideration of the bill (H.R.
10959) relating to the employment of re-
tired commissioned officers by contractors of
the Department of Defense and the Armed
Forces and for other purposes. After gen-
eral debate, which shall be confined to the
bill, and- shall continue not to exceed three
hours, to be equally divided and controlled
by the chairman and ranking minority mem-
ber of the Committee on Armed Services,
the bill shall be read for amendment under
the five-minute rule. At the conclusion of
the consideration of the bill for amendment,
the Committee shall rise and report the bill
to the House with such amendments as may
have been adopted, and the previous ques-
tion shall be considered as ordered on the
bill and amendments thereto to final passage
without intervening motion except one mo-
tion to recommit. -
Mr. MADDEN. Mr. Speaker, I yield
myself such time as I may consume.
(Mr. MADDEN asked and was given
permission to revise and extend his re-
marks.)
Mr. MADDEN. Mr. Speaker, House
Resolution 487 provides for the consider-
ation of H.R. 10959, relating to the em-
ployment of retired commissioned officers
by contractors of the Department of De-
fense and, the Armed Forces, and for
other purposes. The resolution provides
for an open rule with 3 hours of general
debate.
The purposes of the bill are to, first,
attempt to curb, insofar as possible, the
potential for influence, in the field of
military procurement, of retired commis-
sioned officers and active-duty commis-
sioned officers employed by contractors
furnishing anything to the Department
of Defense or an Armed Force of the
United States; second, to make the laws
pertaining thereto equal to all of the
services; and third, to provide exemption
for the five-star generals and admirals
from the law relative to outside employ-
ment of active-duty officers.
H.R. 10959 equalizes for retired offi-
cers of all of the armed services the pro-
hibition against selling to the Depart-
ment of Defense and the Armed Forces.
It also provides that a retired officer may
not sell as the representative of a com-
pany doing business with the Depart-
ment of Defense for a period of 2 years
from the date of his retirement without
losing his retired pay for such period
up to the 2 years that he may engage in
such selling. The only exception Is in
the case of any officer who served. on
active duty less than 8 years and whose
primary duties during his period of active
duty at no time included procurement,
maintenance, or supply. -
Section 2 of - H.R. 10959 will further
lessen the possibility of influence in this
field by limiting outside employment of
commissioned officers on active duty to
those positions which can in no way be
conceived as affecting the procurement
practices or policies of the Department
of Defense or an Armed Force of the
United States. The only exception
6939
thereto is in the case of the five-star
generals and admirals. . -
Those affected by this exemption are
Generals of the Army MacArthur and
Bradley, both of whom are on the active
list of the E rmy but without any duty
assignments and arc employed by organ-
izations which furnish material to the
Armed Forces of the United States.
Section 3 of the bill will repeal the
existing lifetime ban on selling to the
Navy by retired Navy commissioned
officers.
The bill would prohibit selling as a
matter - of principle and as a matter of
law for a period of only 2 years after an
officer retires. -
Congressman HEBERT and the members
of his subcommittee investigating the
procurement operations of the Defense
Department, are to be congratulated for
the outstanding job they have been doing
in exposing some of the questionable
methods of contract letting in our mam-
moth defense program. Having heard
the testimony presented by members of
the Armed Services Committee before
the Rules Committee on H.R. 10959, I am
very much opposed to this bill in its
present form. I am not opposed to the
adoption of a rule as I do 'believe the
members should be given an opportunity
to learn all the facts connected with the
loose methods adopted by leaders in our
Defense Department in granting con-
tracts involving the expenditures of bil-
lions of dollars annually. Congressman
HEBERT'S committee has held extensive
hearings and startling facts have been
recorded in the testimony of wanton
waste and questionable methods used in
negotiating contracts with large indus-
tries who could afford to hire retired mili-
tary officers at fabulous salaries. I un-
derstand that during the 5-minute rule,
Congressman HEBERT and some of the
members of his subcommittee will spon-
sor an amendment to this bill which will
more effectively curb some of the deplor-
able procurement operations of our De-
fense Department. - -
As a Representative in Congress of the
industrial Calumet region, I can say that
during the last dozen years a great num-
ber of small- industries in my area have
been completely estopped from even a
remote consideration of their application
for securing defense contracts by rea-
son of an inside munitions lobby oper-
ated by retired military officers.
. In Drew Pearson's column some time
ago, an article stated that General Elec-
tric, next to Boeing and General Dy-
namics, is the third largest defense con-
tractor in our Government. The article
also stated that in 1958 General Electric
had as high as 35 retired Army, Navy,
and Air Force officers on its payroll at
fabulous salaries. It also stated that
General Electric ranked fifth in the list
of firms employing retired "brass hats."
One of these brass hats was a highly
paid admiral who formerly was Chief of
Naval Personnel and hired some of the
men who were issuing defense contracts
before he retired from the service.
In an article in the February 9, 1960,
Washington Post, it revealed that a
former admiral, after retirement, was re-
ceiving a pension from the Government
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6940 CONGRESSIONAL RECORD -- HOUSE
of $1,072.18 per month in addition to a
$25,000 salary from the Bankers Trust;
$12,000 annually from-Philco; $12,000
annually from Molybdenum Co.; and
$15,000 annually from Champion Paper,
and $2,400 per annum, plus $100 for each
directors meeting from Worthington
Pump Corp.
I am merely mentioning a couple of
the numerous instances where retired
military officers step into fabulous salary
bonanzas after retirement merely be-
cause of their close connections with the
Pentagon and other-defense operations.
I am glad that the Armed Services Com-
mittee is finally taking a definite step to
present legislation that will terminate
this sloppy method of negotiating de-
fense contracts that have cost the
American taxpayers wasted billions in
the last dozens of years. Congressman
HEBERT'S amendment will substitute
criminal penalties instead of the court-
martial trials set out in the committee
bill.
An item in the Washington Post and
Times Herald recently revealed that the
Glen Martin Co., one of the Nation's
largest contractors in the making of vital
missiles, entertained a number of re-
tired and active admirals and Air Force
generals at the swank Cotton Club in
the Bahamas. The paper also recorded
the efforts of the company to deduct this
payola operation from its income tax as
legitimate business expense.
I do hope the Members will remain on
the floor when Congressman HSBERT
presents his amendment to this bill and
listen to his presentation along . with
other members of the Armed Services
Committee who believe that the present
form of H.R. 10959 is more of a skimmed-
milk slap-in-the-wrist piece of legisla-
tion that will not completely eliminate
this deplorable method of negotiating
contracts which involve billions in tax-
payers money every year.
Mr. Speaker, I yield 30 minutes to the
gentleman from Tennessee [Mr. REECE],
and reserve the balance of my time.
Mr. REECE of Tennessee. Mr. Speak-
er, I yield 8 minutes to the gentleman
from Ohio [Mr. BROWN].
(Mr. BROWN of Ohio asked and was
given permission to revise and extend his
remarks.)
Mr. BROWN of Ohio. Mr. Speaker,
this rule makes in order, with 3 hours of
general debate, the consideration of the
bill H.R. 10959, under House Resolution
487 as reported by the Committee on
Rules.
This Is a rather peculiar situation. I
do not think I have ever seen a situation
just like this in the past In connection
with any legislation which has come to
the floor of the House under a rule of this
type.
This rule makes in order the bill, H.R.
10959, which bears the name of Mr.
HsEESRT, of Louisiana. However,- the bill
as it was reported actually was not the
Hebert bill, as originally introduced, and
has been more or less repudiated, may
I say, by the Member whose name it
bears, Mr. HSBERT, who -as you know for
a great many years has been, during the
Democratic controlled Congresses, the
chairman of the special investigating
committee or subcommittee of the Com-
mittee on Armel Services of this House.
During the Republican control of the
House, Mr. HESr;, of Ohio, served in the.
same capacity.
These two men, working with their
subcommittee, named by the Committee
on Armed Services, of course, have done
a great job throughout the years in ex-
posing waste, e:travagance, and some-
times corruptiorn, in connection with de-
fense contracts. By their work they
have saved liters fly hundreds of millions
of dollars for American taxpayers.
Mr. Speaker, this bill was brought to
us in the Committee on Rules after the
Committee on Armed Services of the
.House, under the leadership of its dis-
tinguished chairman, the gentleman
from Georgia [IV r. VINSON]', had made a
great many cha:iges which resulted in
taking out most of the teeth from the
origirial bill-which resulted in destroy-
ing the value of the original Hebert bill.
The gentleman fiom Georgia, the chair-
man of this grea; Committee on Armed
Services, is the friend of all of us. He
has served longer than any other Mem-
ber of the House of Representatives ex-
cept the Speaker of the House. He is
indeed a distinguished Member. The
very fact that th s bill came before the
Committee on Rus es with the Committee
on Armed Services divided within itself
for, perhaps, the, first time since the
memory of man mmneth not to the con-
trary. This alerted some of us In the.
Committee on Rules to look behind the
scenes. I must say, frankly, out of all
fairness to both the chairman, the gen-
tleman from Georgia [Mr. VINSON], and
the gentleman from Louisiana [Mr.
HSBERT], it took considerable pressure on
the part of members of the Committee
on Rules to bring out into the open the
conflict which had gone on between Mr.
HSBERT and his group on the one hand
and Mr. Vnvsow a ad his followers, who
are always large in number in the com-
mittee, on the other.
Mr. Speaker, before I say more, I want
to pay tribute to Chairman VINSON, as
well as to the sub Committee chairman,
Mr. HSBERT, for their past services. Mr.
VINSON is not only. %-great American, he
is a national institution so far as most of
us are concerned, aid he knows full well
how to write legislation. Rather pecul-
iarly, the job that he did, if,I may use
that language, on the original Hebert
bill was quite effective In destroying its
worth, even though he came before our
Rules Committee a ed urged that it be
given a rule and insisted that it was sat-
isfactory as amended.
Incidentally, I bro aght to the attention
of the committee at that time the state-
ments which appear4 td in the committee's
report on this original bill, which showed
that there was a tc tal of 3,353 retired
staff officers altogether. That is on page
18. Then, rather pe uliarly, if you refer
to page 21, when wu get down to these
people who would be affected by this
legislation, and that would only be the
retired officers who were selling to the
Government=just s Ming to the Gov-
ernment and not bet:ig in high positions
in connection with t.iese defense indus-
tries-if you will lock closely-you will
April, 6'
find that engaged in sales, there were
just six officers-just a half dozen.
There might be some other answer, but
we did not get it in the Committee on
Rules from Chairman VINSON if there is
some answer.
Of course if we are only dealing with
six officers we might as well not enact
any legislation. But, as I said a
moment ago, this original legislation did
not seem to be entirely satisfactory to
the chairman after all. I told Chairman
ViNsox frankly I did not think I could
go along with him on the original bill
as amended. He told me there was now
another bill written by the gentleman
from Texas [Mr. KILDAY]. I have -not
had an opportunity to study and analyze
that one as I would like. It is H.R.
11544; and.then I find another bill, H.R.
11576, 32 numbers higher. ' I do not
know the reason why we have these two
bills or what the differences between
them are, but I know they are both quite
different from the original amended
Hebert bill that the chairman brought
to the Rules Committee. That is what
we are voting on now, the original
Hebert bill, as amended, at the sugges-
tion of the Armed Services Committee
and as reported out by that great com-
mittee.
We are not children. Most of us have
been here at least 15 or 16 months, even
if we are freshmen Congressmen, and
some of us have been here a quarter of
a century, and some even longer. We
know, and anybody that has any con-
nection with the Government knows, that
there is something wrong when so many
of these officers are retired and so many
of them immediately go out and get
high paying jobs with industry that is
manufacturing something to sell to the
Government of the United States-that
has to be purchased under contracts
that have to be approved by other offi-
cers-with whom some of these men
served, and perhaps whom they even
promoted before they left the service-
that something is seriously wrong.
Another thing that gripes me is that a
great many of these officers who are re-
tiring and going into industry are upon
retirement found physically incapaci-
tated and are given tax exemption on
their retirement benefits. A poor old
Congressman, who pays at least half of
his retirement costs, it does not make
any difference how unfit he may be, can
not get any tax reduction. He just pays
his taxes anyway. There is a reason
why these things are happening. The
people of America know there is some-
thing wrong. I cannot point a direct
finger at any of it. But I believe the
men who. have investigated these things,
like Mr. HSBERT and Mr. HESS, can tell
you about it and give you the facts and
the cases. ' As far as I am concerned I
resent that somebody thinks I am stupid
enough to swallow the story that there
are only six retired officers who have any-
thing to do with military sales. The
American people will not buy that, either.
These new bills, and the amendments
that will be offered by Mr. HSBERT and
others deserve serious consideration by
this House. -I agree with the gentleman
from Indiana, when he says this is one of
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the most important bills to come before
this Congress in a long time, because the
taxpayers are demanding that we, do
something to out down on this kind of ac-
tivity, and on the huge cost of defense,
all of which reflect these high salaries
that are paid to these men, many of
whom are hired for one reason only, and
that is because of their influence at the
Pentagon.
Mr. HALEY. Mr. Speaker, will the
gentleman yield?
Mr. BROWN of Ohio. I yield to the
gentleman from Florida.
Mr. HALEY. Is there not some pro-
hibition in other departments of Gov-
ernment?
Mr. BROWN of Ohio. Oh, yes. If a
lawyer, who has been employed in a
Government agency, takes any fee to rep-
resent any client before a Government
agency or Department within 2 years
after retirement, he is subject to a crim-
inal penalty. But here we just say, "You
will lose your retirement pay for 2 years."
If you are getting $100,000 per year for
your influence you do not mind losing
$10,000 a year in retirement benefits.
Mr. MADDEN. Mr. Speaker, I yield
10 minutes to the gentleman from New
York [Mr. SANTANGELO].
Mr. SANTANGELO. Mr. Speaker, I
support the Hebert bill insofar as it goes.
I believe the Kilday bill is a milquetoast
approach to a very serious problem. I
believe that there should.be a complete
ban on employment for a period of 2
years if we seek to remedy the situation
and reduce the cost of our military oper-
ation and remove the waste.
This Hebert bill, H.R. 10959, seeks to
eliminate or do away with possible in-
fluence by retired military officers in
obtaining defense contracts. Members
of the House may remember that during
the consideration of the defense appro-
priation bill on June 3, 1959, I introduced
an amendment which provided that none
of the funds in the appropriation bill
could be used to enter into a contract
with any defense contractor which pro-
vided compensation to a retired or inac-
tive military or naval officer who has
been an active member of the Armed
Forces within 5 years of the date of the
enactment of this act.
This amendment was a complete ban
on employment of retired military off-
Pers. It was not a partial ban on em-
ployment of these retired commissioned
officers. It, in effect, prohibited a de-
fense contractor from being paid if it
hired a retired officer, flag or commis-
sioned, who had left the service within
the past 5 years. On that occasion, in
discussing my amendment, I said among
other things on page 8784 of the CON-
GRESSIONAL RECORD that this amendment
is designed to eliminate influence by a
retired military officer above the rank of
colonel and to reduce the cost of our
defense program. It will permit those
who grant procurement contracts to let
them without offending their former
bosses or colleagues.
It has become rather general practice
for high-ranking military officers to ac-
cept important positions in defense in-
dustry after their retirement from active
military service. We have approved the
budget request of $715 million for re-
tired pay of military personnel. Retired
officers receive substantial retirement
benefits. In some cases such officials
take positions with, companies which
have large contracts for the furnishing
of war materiel to the Defense Depart-
ment.
There can be little doubt that this is a
very unhealthy situation and should be
changed immediately. It can have a
very definite effect on contracting poli-
cies and procedures within the Defense
Department. It can result in unneces-
sary expenditures and waste.
Persons within the Department who
may be looking forward to possible em-
ployment within a certain organization
after retirement can display partiality
and favoritism without ever realizing it.
Further, prominent military figures in
retirement can have a great influence
over their former subordinates who are
still in the Department. Contact at so-
cial and professional gatherings between
active and retired officers can provide a
perfectly natural setting for influence
and favoritism.
As you may remember, my amend-
ment, after being approved by a voice
vote, was dramatically defeated by one
vote on a division after the House was
assured that an investigation would be
held by a subcommittee of the Armed
Services Committee headed by the gen-
tleman from Louisiana [Mr. HEBERT].
Such hearings were extensively held and
my statements which I made on June 3
in connection with the defense appro-
priation bill have been borne out fully by
the disclosures and the 'testimony in
those Hebert hearings. I commend the
gentleman from Louisiana [.Mr. HEBERT]
for the wonderful work he did in the
investigation by his subcommittee.
We have seen from the testimony how
extensive has become the practice of hir-
ing retired officers. On pages 8 and 9
of the report of the subcommittee of
the special investigation on employment
of retired commissioned officers by De-
fense Department contractors, we see
the startling disclosure that the 100 big-
gest defense contractors have hired 1,401
retired commissioned officers, which in-
cludes 251 flag or general officers. The
seven defense contractors which have
the greatest number of retired flag and
commissioned officers on their staff are
as follows:
General Dynamics --.--..
Lockheed -----------------
Martin Co ---------------
RCA -------------- ------
General Tire & Rubber
Co-
I.T.T-
Boeing-------------------
De-
fense
posi-
tion
Number
of retired
military
officers
Number
of retired
flag
officers
These retired men are receiving pen-
sions from the U.S. Government, with
the average annual pensions ranging
from $2,400 to $8,400. Some officers re-
ceive more than $8,400 In pension or
retirement benefits. The defense indus-
try annual salaries paid to retired flag
officers range from a low of $5,000 to a
high of $100,000. Approximately 180 of
the 251 retired flag officers receive in
excess of $10,000 salary annually from
these defense contractors. About 25 flag
officers receive more than $25,000 per
year in salary and 8 of them receive over
$50,000 per year in salary from these
defense contractors.
These are, certainly lucrative salaries
for men who have retired and are re-
ceiving pensions. Do you think, gentle-
men, that officers who are looking for-
ward to retiring are tempted to favor
defense contractors with whom they
might join after they retire? Do you
think our procurement policies and our
high military costs are affected by this
temptation? Do you think that flag
officers have no influence on their former
subordinates in obtaining defense con-
tracts for their new employers?
The 1961 hearings on procurement
show that $8 billion to $10 billion worth
of supplies and equipment is declared
surplus by the Armed Forces every year.
To what extent is the $8 billion to $10
billion worth of declared surplus every
year the result of influence peddling in
our procurement policies? For 20 years
the armed services have been saying they
are streamlining and improving their
procedures in procurement, but the $8
billion to $10 billion of declared surplus
and waste still continue, so much so that
the chairman of the Appropriations Sub-
committee on Defense spoke with a feel-
ing of frustration when he said that
what the services say that they are doing
in improving procedures of procurement
was not encouraging to him.
I cannot condone, and I am certain
that this body does not approve the prac-
tice of certain defense contractors in
entertaining at their expense bur high-
est military officers, past or present, in
the Bahamas or in private clubs. The
Hebert subcommittee explored a phase
of this practice and exposed the en-
tertainment by the Martin Co., one of
the largest defense contractors which
does exclusively defense contracts. This
company has hired 63 retired commis-
sioned officers and resists payment of
their income taxes on their excess profits
after the Federal Renegotiation Board
has determined that the Martin Co. for
a period covering 3 years made in excess
of $25 million of excess profits.
I believe the subcommittee has done
an honest job and the gentleman from
Louisiana [Mr. HEBERT] has tried and
sought to bring out an effective bill which
is designed to eliminate influence ped-
dling or any aura of influence peddling.
His bill is more limited than my amend-
ment which I introduced last year to
the appropriations bill. His bill does not
ban the employment of retired officers,
but prohibits the selling by retired offi-
cers to any of the armed services. The
Department of Defense concurs in the
thought that there should be a cooling-
off period. Responsible and high mili-
tary officers agree that there should be
a cooling-off period. The committee re-
port indicates the meaning and intent
of the word "selling," but the bill does
not spell out or give the definition of
the word "selling." The report provides
that any action in the proposal, devel-
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opment, or production of an article is
a link in the chain of selling and would
be banned during the proscribed period.
Congressman HEBERT,- in his original
bill, sought to impose sanctions in two
forms: First, a loss of pension, and
second, imprisonment and fine for vio-
lation of the ban against selling. The
full committee deleted the criminal pen-
alties. To eliminate criminal penalties
or sanctions and to limit penalty only
to a loss of -pension for a period of 2
years is in effect to require a license to
sell with a license fee most likely being
paid for by the defense contractorin the
form of a higher salary to- the retired
commissioned officer. This is no pen-
alty -whatsoever and is a milquetoast ap-
proach. By eliminating the criminal
provision, the full committee has scut-
tled the bill and made the enforcement
provisions ineffective.
I believe that sanctions and penalties
should be placed upon the one who
profits by the violation of law, and that
is the defense contractor. I believe that
where the defense contractor knowingly
permits a retired officer to sell to the
Armed Forces in violation of law that the
defense contractor would forfeit his
rights under the contract which was ob-
tained through the prohibited influence
and would also be prohibited from doing
business with the Government thereafter
for a period of 1 year. However, I would
provide a safety valve and would per-
mit the Secretary of Defense to waive
the forfeiture and prohibition if the Sec-
retary ofDefense thinks that it is in the
interest of national defense that he so
do, but if he does, he must notify the
appropriate Armed -Service Committee
of the House and Senate of the reasons
which compel his action.
Only an effective bill will reduce the
waste and high cost in our military pro-
curement which after all is the major
objective of eliminating influence ped-
dling. The 1961 budget for our national
security is $45,600 million of which $13,-
602 million is for the purchase of air-
craft, missiles, ships, and other military
equipment. We cannot afford the pur-
chase of supplies and equipment which
are wasteful and not usable. Too long
have billions of dollars of military equip-
ment and supplies been declared surplus.
If we want to help our Nation grow
strong, we must get our dollars value for
the dollars we spend. Our Nation and
the taxpayers are prepared to spend bil-
lions of dollars for defense, but they dis-
approve the expenditure for waste and
inefficiency or -influence peddling.
We must take effective action now.
(Mr. SANTANGELO asked and was
given permission to revise and extend his
remarks.) - -
Mr. REECE of Tennessee. Mr. Speak-
er, I yield myself 12 minutes.
Mr.-REECE of Tennessee. Mr. Speak-
er, I am in favor of the rule and I am
in favor of the bill, but I question if the
bill goes far enough to accomplish the
objectives of its sponsors. In my service
on the Armed Services Committee, I had
some opportunity to make some obser-
vations in this area which gave me great
concern. It is with mixed feelings that
I am saying what I do today. I am not
one who carries lightly the responsibili-
ties of membership in this body to
which I came as the' youngest Member
39 years ago.
In what we nt w refer to as World
War I, I had the :Ionor of serving in the
U.S. Army. My duties took me overseas
where active coma at fell to my lot. This
in turn resulted ii my country's honor-
ing me with certa.n awards which I have
always prized more highly than any
other honors which it has been my good
fortune to receive
Upon being firs elected to Congress
in 1920, among my early committee as-
signments was one to the old Military
Affairs Committee, the forerunner of
our present Armed Services Committee
on which I have served also. With the
exception of my ;ood, friend, Chairman
VIN50N, only S ?eaker RAYBURN was
serving in this lody when I was first
elected. During x,11 these years my re-
spect for the armed services has been
high, and my deep attachment to and
regard for our Ai my has never wavered.
With this for a background, I now feel
it is my duty to indict that branch of
the armed services in which I served for
a severe derelietian of duty.
Its part in the one segment of the
missile program that I have studied
indicates a sorry iLnd a sordid role which,
in my opinion, stems from the very
problem with which this legislation is
concerned.
Broadly speaking, that segment of the
Army's missile r rogram which I have
studied and- about which I am speaking
today, the Army's efforts have not been
directed exclusively toward the defense
of our country. They have been directed
almost solely toward benefiting finan-
cial ' ly a few very large corporations who
are in almost complete control of the
Army's missile program. That the pur-
suit of this policy has, or will, benefit
certain highly placed Army personnel
is all too obvious. To this indictment I
wish to specifically exempt the ABMA
project, or pro, ects, headed by Dr.
Wernher von Bra.zn. I also wish to make
plain that I in no way mean to ques-
tion the integrity and good faith of the
Honorable Wilbe., M. Brucker, Secretary
of the Army, with whom I served in the
Rainbow Division.
The facts uncovered show clearly that
these unworthy manipulations have been
carried on in such a manner and at such
a level that, due to the constant pres-
sure of his high office, he could not be
acquainted with all of the sordid ma-
neuvers that hav; come to my attention.
With the limited means and time at
my command, I ]rave been unable to in-
quire intelligently into but one of -the
many Army missile projects; namely, the
Nike system, whi ;h includes Nike 1, Nike
2, Nike-Ajax, Nike-Hercules, and Nike-
Zeus. The facts revealed are appalling.
The Army actually has no control over
this situation. Through means and
methods effective but obscure, the Army
has become the captive of industrial
forces of great lower, particularly Bell
Laboratories aI id Douglas Aircraft.
These controls apparently extended from
the low of lieutenant colonel and civilian
levels up to ar d including both the
former Assistant Secretary of the Army
for Logistics-another term for procure-
ment-Mr. Frank Higgins and his
former deputy, Mr. Courtney Johnson,
who was recently named to succeed him,
and the Director of Research and Devel-
opment, a former Bell Laboratories em-
ployee, Dr. William H. Martin and his
deputy, Dr. Edward C. Whitting.
4n passing from the bottom to the top,
this sinister influence touches a section
of the Office of Chief of. Ordnance, cer-
tain sections of the general staff in
Washington, and certain sections of Red-
stone Arsenal. At Redstone, Nike deci-
sions ceased to be made except with the
concurrence and consent of the above
named great corporations. This in spite
of the fact that the Redstone Arsenal
was charged with the responsibility for
the entire Nike system.
We have a condition existing where no
new material or process can be intro-
duced if it runs counter to the financial
gains presently accruing to the indus-
trial system controllers, in this particular
case, Bell and Douglas. This pressure
from these industrial giants is so great
that the Department of the Army is
captive to them, and by them is almost
wholly controlled. This is true even
when new materials and processes have
produced in prototype an article proven
by the Army's own tests to be superior
to those presently being produced. It
does not matter, either in the Pentagon
or at Redstone, that the using services
charged with the defense of our country
urge the adoption of the new, better and
cheaper materials. This does not weigh
with those in control and in turn con-
trolled. -I was personally told by the
then Assistant Secretary Frank Higgins
himself that the general officer then in
charge ofthe antiaircraft defense of this
country had no say in determining what
weapons would or would not be given him
with which to conduct this defense. And
this is at a time when we are advised by
the military themselves that we stand
in great peril.
That an almost complete monopoly
has been established by Douglas and
Bell, with their subsidiaries, in this par-
ticular field is irrefutable. This goes - so
far that if other organizations can sup-
ply that which Douglas cannot supply,
Douglas will demand, and what is worse,
receive the prime contract. They then,
because they are incapable of doing this
particular work, subcontract to other
organizations and receive the same per-
centage of profit as if they had done
the work themselves. This results in
multiplying the costs to -the Govern-
ment in that this system of prime con-
tracts and of subcontract piled on top
of subcontract sometimes costs the
Government up to 30 percent more for
the product received.
Why and by whose authority has this
shameful -condition -come about? Who
are those responsible for this condition
of affairs? How many hundreds of mil-
lions or of billions of Government money
has been poured into the maintaining of
this monopoly? What has the overall
profit, not only in dollars but in facili-
ties, been to the monopoly holders? In
one instance called to my attention some
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time ago there was a cancellation of a Later, the commanding general awarded the small successful developer,
missile production contract. Subsequent charged with the continental antic.,aft but, as phase 1 was being successfully
to this cancellation, the contractor was defense, recommended by letter the dis- completed, evidence began to mount that
able to declare a million dollar bonus to continuance of the production of the phases 2 and 3 would - be canceled
each of its five principal officers. metal monstrosities, and the incorpora- and that the big industrial system con-
In the case of the Nike-Ajax, which, tion into the entire Nike system of the trollers would finally completely sup-
together with its successors, the Nike- new and more effective Fiberglas. booster. press or at least delay it until they could
Hercules and Zeus, constitute our prin- That was more than 3 years ago, master the production techniques of
cipal defense against incoming aircraft The Army officers and civilian person- Fiberglas.
and air breathing missiles, there are now nel who had brought about this develop- There is in my possession actual data
surrounding all of our great cities hun- ment were elated and urged its imme- that indicates an arrogance on the part
dreds, perhaps thousands, of installa- diate adoption. The dreaded disposal of the monopoly holders that makes them
tions for the firing of these missiles. In problem, this threat to life and property, immune to any questioning.
connection with these installations, there a veritable nightmare to Army's high I have also encountered at Assistant
arose one problem of great magnitude command, had been solved and in a Secretary levels a blandness, a laissez
which the Army recognized but was un- manner that greatly improved the per- faire attitude, repeated promises cyni-
able to solve. formance of the missile. cally made and never kept.
As long as 6 years ago, high officers in This development employed a rela- When we stop to think of what a very
the Research and Development Section tively little known material, Fiberglas, small segment of the whole missile pro-
of the Office of Chief of Ordnance about which neither of the big corpora- gram I am speaking of, and if we apply
realized that the heavy metal booster en- tions in control of the program had to this situation the simple rule of mul-
gine that got the missile into the air much knowledge. Also they had not tiplication, we begin to have some idea
would invariably fall back to earth. succeeded in mastering the processes in- of why our present relative position in
They began to worry because the metal volved. Therefore, if these new units this atomic age is questioned and why
cylinder performing this task might fall went into mass production, the big boys those dedicated men manning our ram-
in the cities' most populous areas. The would not be able to make them. Being parts all over the world are crying to us
public did not know that the heavy unable at the moment to compete, they not to risk destruction in order to in-
booster engine, quite a missile in itself, simply had this new development sup- crease the dividends and resources of
if fired, with or without a warhead, pressed. these huge corporations who hold large
could land on and pierce any building, The developers of the new frangible segments of our Army procurement
thus causing great destruction and loss Fiberglas booster were divided into two agencies captive.
of life. Thus was born what the mili- categories: First, dedicated personnel Inplain language, the actions of those
tary termed "the disposable problem." under military control who were proud responsible for bringing about and main-
The public were led to believe that the of the result of their efforts; and second, taming this condition constitute an al-
Army controlled the selected areas into the small industrial corporation that had most criminal breach of duty and such
which the heavy booster engine would brought to fruition this successful de- persons should be ferreted out and ban-
fall. Actually, the Army did not nor velopment. When both sets of these ished. This will take time and effort,
does not own an acre of ground dedi- developers protested against the tyranny but it is a responsibility our service sec-
cated to this purpose. Had the public that suppressed this scientific advance- retaries should assume regardless of the
known the truth regarding this threat ment, they were promptly treated to cost in time and effort.
to their safety they would have de- what is called "proper discipline." The . Legislation may help in correcting the
manded, and now would demand, that military - controlled personnel . were situation but, in my opinion, it will not
the Army solve this frightening problem. threatened with dismissal or were sent be corrected until the service secretaries
Faced with these facts, the Research to far off places-in Army slang, this is assume full responsibility and devote the
and Development Division of the Office referred to as "banishment"-while the time and effort -necessary to advise
of Chief of Ordnance directed Redstone - protesting small industrial developer was themselves of the condition and assume
Arsenal to procure a booster engine that unofficially blacklisted, all of its con- the responsibility for correcting it.
would disintegrate in the air after sepa- tracts canceled, all of its prepared and (Mr. REECE of Tennessee asked and
rating from the missile proper, approved publicity suppressed, and all was given permission to revise and ex-
Bell Laboratories, Douglas, and others, Army controlled personnel forbidden to tend his remarks.)
then engaged, through subcontractors, in - communicate with them. - Mr. MADDEN. Mr. Speaker, I yield
making very profitably the metal These actions not only constitute a 5 minutes to the gentleman from Texas
boosters at a high rate of production, in- violation of oath of office but, in my [Mr. KILDAY].
formed the Army that no such booster opinion, indicate a near criminal con- (Mr. KILDAY asked - and was given
could be produced. They were wrong. spiracy on the part of highly placed offi- permission to revise and extend his
In 1955 the frangible booster made of cials in the Department of the Army and - rem A .)
Fiberglas, self-destroying and falling certain representatives of industry. . Mr. KILDAY. Mr. Speaker, I want
from the sky like corrt flakes, became a -Because the demand for an improved to make it perfectly clear that the prac-
reality. This was accomplished as a - nonmetallic self-destroying booster con- tice of defense contractors employing
result 'of a small research and develop- tinued to come from so many sources, it former officers of the military services
ment contract issued by Redstone Ar- was decided and agreed upon at a very for the purpose of selling their products
senal to an independent contractor who high level to try it out in a larger field, to the Defense bepartment is not en-
specializes in molded and spun Fiberglas that is,, the Nike-Hercules, but because dorsed or condoned by me. I know of
construction. This corporation, spend- Douglas had not yet mastered the Fiber- no member of the Committee on Armed
ing only a fraction of the moneys allotted glas technique, this decision was held Services who is not now prepared and
to its big competitors for similar pur- in suspension for over a year, and to attempting to put a stop to that prac-
poses, met the Army's rigid requirements, this day the Hercules is, unless a switch- tice. So that the debate that has been
and actually in so doing very greatly over has been made recently, using four. going on here is not quite. germane to
improved the overall performance of the of the old obsolete and easily corroded the situation which exists, as we have
entire missile. Incidentally, although metal boosters needed to get it off the `the parliamentary situation- before us.
given many times as much money, the ground. Thus, for each single error in I join in the request of the gentleman
big competitor never produced a single the Nike-Ajax, there are now four such from Indiana and the gentleman from
acceptable- article. The new Fiberglas errors in the Hercules. Where there Ohio that you listen carefully to what
booster was tested at the Army's proving was a certain amount of additional drag the gentleman from Louisiana [Mr.
ground at White Sands, N. Mex., after or air resistance for the Ajax, caused HEBERT] has to say and his contentions
which it was passed by Board 4, the by the metal booster, this defect-and with reference to the bill that is before
Army's highest testing authority. Red- many others-is multiplied four times us. I also ask that you pay rather close
stone Arsenal then certified this frangible in the Hercules. attention to others of us who may dis-
booster as ready for production and so After 2 years delay and many false - cuss this matter after the rule has been
recommended. starts a small development contract was adopted. I will tell you now what I
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 6944 Approved Fp~?,/A1p/%;d6fi6DP$,"5R000400280008-9 April 6
anticipate the parliamentary situation have the privilege of coming to grips pline shall be divorced from the military
will be. with the issue. and from the courts-martial and placed
We have pending before us a bill by Mr. KILDAY. The Committee on in the Department of Justice and before
the gentleman from Louisiana [Mr. Armed Services never had jurisdiction the U.S. Are you not going too
HEBERT], reported out of the Committee to require a criminal penalty which the far? .
on Armed Services. gentleman proposes. I ; is a matter with- There is another matter to think
That is the bill which the rule makes in the jurisdiction of the Committee on about: A little bit of knowledge is a
in order. At the proper time either the the Judiciary. It is no, within the juris- mighty dangerous thing. There does
chairman of the Armed Services Com- diction of the Committee on Armed not seem to be general understanding of
mittee or I, in accordance with the in- Services. That is the parliamentary sit- what section 1161 of title 10 of the
structions of the Committee on Armed uation. We have beer. accused of writ- 'United States Code involves. It gives
Services, will offer as a substitute for the ing a milk toast bill for having done to the President of the United States
bill reported by the committee the lan-- something we had nc right under the theauthority to drop from the rolls any
guage now contained in H.R. 11576 -rules of the House to do. officer convicted and confined, if he is
offered by me on yesterday. This is the The SPEAKER. The time of the gen- convicted in any tribunal other than a
language which was approved in the tleman from Texas has expired. - court-martial. So if you go by the civil
Armed Services Committee yesterday. Mr. ARENDS. Mr. Speaker, I yield court rule you place-inthehands of the
After.debate of about an hour and a the gentleman 2 addit.onal minutes. President, meaning, of course, the mili-
half, in which the gentleman from Loui- Mr. HEBERT. Mr. Speaker, will the tary departments concerned, not only
the right to punish the guilty officerbut
siana [Mr. HEBERT] participated, and
after rollcall vote, this version was ap-
proved 24 to 10, specifically over the
Hebert version.
The language contained in my bill that
I will offer as a substitute at the proper
time, in prohibiting ,former officers from
working for defense contractors in sell-
ing, is the identical language of the
Hebert bill. It is the language written
by Mr. HEBERT and his subcommittee. I
then attached to it a penalty involving
the forfeitureof retired pay for a. period
of 2 years. The loss is for 2 years re-
y
y connec
e
rect
ficer was d
gardless of when the transaction occurs
immediately prior to his retirement, to any
gentleman yield further? to visit punishment upon his widow and
. Mr. KILDAY. -I yie. d. orphans. Mr. Speaker, there is a great
Mr. HEBERT. -I aln glad the oppor-
tunity came up now. I will read you
this language:
Title 18, United States Code, is amended
by adding a new section as follows:
"SEC. 292. Whoever, being a retired com-
missioned officer of the Uniformed Services
not on active duty, retir, ~d after having com-
pleted 20 or more years -)f active duty, with-
in two years after his rtirement, knowing-
ly sells, or assists in eel ling,- any article; in-
cluding the parts thereof, in which the of-
ears
d within five
t
i
l
an
t
i
y
o
ttee :Defense; or recomuienutk or suggests,
bill of the comm
for the time he was engaged in selling. person in any departme nt or agency of the
I have also added to this bill a new see- Department of Defense, the purchase of any
tion 3, which provides that any retired article or part thereof in which the officer
r
im-
fi
ithi
commissioned officer subject to the Uni-
form Code of Military Justice who vio-
lates any provision of this act shall be
tried by court-martial, and shall upon
conviction be punishable as the court-
martial shall direct. The gentleman
from Louisiana proposes that it be
made a criminal offense under title
ve yea
s
n
was directly connected v
mediately prior to his retirement; or com-
municates in any way with any person in
any -department or agony of the Depart-
ment of Defense in connection with any
article or part thereof manufactured by or
capable of being menu'actured by any per-.
son or corporation frorl whom such officer
receives compensation for services performed
XVIII of the United States Code,,pun- shall be fined not m(?re than $10,000, or
fishable by a fine not in excess of $10,000 imprisoned for not mo.,e than one year, or
11
or confinement for not more than 1 year, both.
or both. So the only issue between us is This language came to my attention.
whether a man is to be tried by a U.S. Mr. KILDAY. I d,) not yield furthe
districtcourt or by court-martial. That on that point. .
Committee on Armed Services who has he cannot yield. I want to prove that
endorsed any of the action detailed by the gentleman's name is on the letter of
the gentleman from New York [Mr. SAN- transmittal. -
TANGELO] or any of the other proposals - Mr. KILDAY. Th ?re is no question
mentioned here. but when this was ruder consideration
Mr. HEBERT. Mr. Speaker, will the many of us did write letters.
gentleman yield? - I think that that is 1 proposal; you
Mr. KILDAY. I yield to the gentle- can probably find 1) more. I do not
man from Louisiana. - - know who wrote it; ". may have written
Mr. HEBERT. The gentleman has it myself; maybe thv staff of the com-
clearly stated the parliamentary situa- mittee, or maybe th l chairman. That
tion. Will the gentleman allow me to get is not the point. Ti.e point I am talk-
before the House an opportunity to have ing about is that we have been pilloried
a vote on that issue? for having failed to do something that
.,o
r not do
u
act upon this bill upon the debate that
appears in the House, the hearings and
the report on the bill, and not those
things that have been written in the
newspapers.
Mr. HEBERT. I hope that is correct,
but I hope nobody raises a point of or-
der against the language in my bill. If
the gentleman raises a point of order
and it is sustained, the House will not
argue it on the merits in much more
detail-unless I can get more time
now-as to why a military man should
be subject to trial by court-martial
rather than in the U.S. district court..
The military authorities have -absolute
jurisdiction over the enforcement of
discipline in every other category. Why
should we now pick out this one cate-
gory and say that this portion of disci-
such time as he may desire to the gentle-
man from Florida [Mr. BENNETT].
(Mr. BENNETT of Florida asked and
was given permission to revise and
extend his remarks.) -
Mr. BENNETT of Florida.. Mr. Speak-
er, I sincerely hopethat this bill, however
amended, will promptly become law in a
form which will effectively protect our
country against the improper influence
activity which has made it necessary.
Although the vast majority of military
personnel on active duty and retired have
done and do a fine job for their country
in every respect, the exceptional or un-
usual cases of abuses have cried out for
the correction we seek in this legislation.
I also hope that the House Judiciary
Committee may soon report favorably
er, I yield - the remainder of my time to
the gentleman from Iowa [Mr. GRossl.
(Mr. GROSS asked and was given per-
mission to revise and extend his re-
marks.) -
Mr. GROSS. Mr. Speaker, I ask unan-
imous consent to speak out of order.
The SPEAKER. Is there objection to
the request of the gentleman from Iowa?
There was no objection.
Mr. GROSS. Mr. Speaker, last week
when the House had under consideration
the $4.2 billion appropriation bill for the
Department of Health, Education, and
Welfare, I called attention to some of
the fellowship grants under the National
Defense Education Act which provided
for studies in music, folklore, jazz, the
theater, the ecology and economics of
flowing water, and a score of other sub-
jects wholly unrelated to national de-
fense. In studying the hearings I also
came across a research grant which is
almost beyond belief. This is in the field
of international research grants, and
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 1960 Approved Fort ft%?_QMR/L6Ro PM1 W000400280008-9 6945'
was in effect as of January 1, 1960. I
was 1 of 10 who voted against the appro-
priation bill and I would like to call this
to your attention, those of you who voted
for the bill. Here is a grant of $33,101
to the Israel Institute of Applied Social
Research, Jerusalem, Israel; the project
is this, and I will read it verbatim from
the record of the hearings:
A test of husband and wife relationship.
The aim is to develop a diagnostic pictorial
test of both intrrpersonal and interpersonal
aspects of the role of relationship of hus-
band and wife. The test should be sensitive
to the perceptions of actual behavior and
norms, and to the consonance perceived be-
tween these.
Mr. Speaker, I find no words to com-
ment further on this utter waste of the
taxpayers' money and I yield back the
balance of my time.
Mr. MADDEN. Mr. Speaker, I yield
2 minutes to the gentleman from Rhode
Island [Mr. FORAND).
(Mr. FORAND asked and was given
permission to revise and extend his re-
marks.)
Mr. FORAND. Mr. Speaker, I ask
unanimous consent to speak out of or-
der.
The SPEAKER. Is there objection to
the request of the gentleman from Rhode
Island?
There was no objection.
Mr. FORAND. Mr. Speaker, yester-
day marked the 25th anniversary of the
social security bills being reported out of
the Ways and Means Committee of this
House.
The social security law I am sure all of
you will admit is a most salutary one
and one that I doubt anybody would
want to see wiped off the statute books.
It has been expanded gradually. I have
been trying-to expand it so as to encom-
pass the health care of the aged.
Three years ago I introduced a bill in
this Chamber for that purpose. In Janu-
ary of 1959 I reintroduced the same bill.
Hearings have been held on it but I am
unable to get it out of my own commit-
tee, the Committee on Ways and Means,
to bring it before the House for a vote.
Therefore, today, the third day follow-
ing the 25th anniversary of the reporting
of the social security law, I have placed
on the Clerk's desk discharge petition
No. 4.
Many, many Members of this House
have been pressing me for action for a
long time. Having exhausted every
means at my command to bring the bill
out for a vote, I had to resort to the
discharge petition. After serving here
for 22 years it is the first time I have
resorted to a discharge petition and to
resort to discharge my own committee
hurts me. But now it is entirely up to
you, the Members of this House. If you
want to vote on health insurance for the
aged under the social security law it is
up to you to sign the petition, If 219
Members sign it I assure you I shall
continue to do my best to get the bill
not only tp a vote but to have it passed.
Mr. MOORHEAD. Mr. Speaker, fear
darkens the lives of millions of our
elderly citizens.
It is the fear, Mr. Speaker, which
comes when one is old and facing seri-
ous illness.
It is the fear which is fed by realiza-
tion that all of the meager savings set
aside to maintain a dignified old age
will be washed away by the expenses of
only one serious illness.
It is a fear made worse when there
are no resources at all to pay for pro-
longed medical care.
Fear is the negative, wasteful type of
emotion we Americans do not like to
talk about. Nevertheless, it is real and
must be recognized. There are times
when a sense of compassionate human-
ity and a sense of what is right and
good for the individual and the strength
of the entire country require us to take
decisive action to remove a particular
fear at its very roots.
On January 6, 1941, in this Chamber
a great American struck out against fear
in a ringing declaration of the four free-
doms aspired to by millions. Two of the
four freedoms that President Franklin
D. Roosevelt called for were freedom
from want and freedom from fear.
Mr. Speaker, our older citizens today
are not free from want-they are not
free from fear.
We can make them free. We have
the means before us now, if we will but
use it, of rescuing millions of our elderly
from their most pressing fear-the fear
of illness which finances cannot meet.
The gentleman from Rhode Island
[Mr. FoaANDI has given us such a means.
He has just prepared a petition which
could discharge from committee and
bring to the floor of the House his bill
providing hospital, surgical, and other
medical benefits for millions of our older
citizens.
I consider myself privileged to be
among the first signers of that petition.
I hope a majority of my colleagues
will sign it, for legislative responsibility,
in its deepest sense, requires that we
debate the Forand bill now.
An outpouring of arguments has
swirled about this question. There have
been millions of words eloquently favor-
able and acrimoniously opposed to the
concept of providing prepaid medical
benefits for the 15 million Americans
most directly affected.
I do not, nor does the author of the
bill, insist that this proposed legislation
cannot be improved. I myself would
like to hear debate on proposals to in-
crease the benefits and reduce the ad-
ministrative costs of the Forand bill the
way automobile collision insurance is
handled. Insurance companies reduce
overhead by providing a $25 deductible
policy for collision insurance. Statistics
show that hospitalization benefits could
be increased from 60 days to 365 days at
the same or less cost if benefits did not
cover the first 3 days of hospitalization
illness.
Such amendments would strengthen
the program actuarially and completely
demolish arguments now used by those
who oppose the bill with the scareword
"socialized medicine."
Mr. Robert J. Myers, chief actuary
of the Social Security Administration,
has submitted to me, at my request, a
memorandum in which he states:
A 3-day deductible would reduce costs by
an estimated 17 percent. An increase in the
maximum duration from 60 days to 180 days
would increase costs by 12 percent and an
increase from 60 days to 365 days would in-
crease costs by 15 percent. Thus, the intro-
duction of a 3-day deductible and an in-
crease in the maximum duration to 365 days
Would result in a proposal that would have
a cost slightly lower than-the original basis.
If such amendments are necessary in
order to pass this legislation, I certainly
would not oppose them, because the im-
portant thing to do is to enact legisla-
tion which recognizes the need and the
moral obligation to take care of it.
There is no doubt that the need exists.
Letters now being delivered by the
thousands to both House Office Build-
ings express this need more eloquently
than can any of us here on the floor
secondhandedly.
In addition to my own regular corre-
spondence on this subject and my meet-
ing with many of the elderly. in my dis-
trict face to face last fall during hear-
ings of a Senate Subcommittee on
Problems of the. Aged in Pittsburgh, I
have added reason to know how vital
the problem of paying for medical care
is to the elderly.
Early in January, after the first ses-
sion of this present Congress had been
well assessed and the second session was.
beginning, I sent to my constituents an
annual report.
At the end of that report I left a
blank space beneath a notation inviting
citizens to check legislative subjects in
which they had the greatest interest.
I did not specifically request replies,
nor did. I provide postage for this pur-
pose. Yet, nearly 2,000 of my constitu-
ents were so interested that they volun-
tarily wrote to me.
On the basis of these replies, social
security clearly emerged as the legisla-
tive subject of greatest interest, with
many of the people saying that, when
they listed social security legislation,
they had in mind passage of the Forand
bill.
My colleagues know well the type of
letters these were:
An 81-year-old widow receiving social
security writes:
By the time I pay rent, insurance, and
medicine, I have little left for food. * * * I
applied for old-age assistance and, because iI
saved enough furniture to furnish a vacant
room, I was told to sell all my possessions
and live in a furnished room with a hot
plate to cook on. * * * Social security does
not suply doctor fees or hospitalization. * * *
My eyes need examined. * * * Anything
you can do will be truly appreciated.
Another writes of the Forand bill:
It will be a blessing to many poor old folks
who cannot afford medical and hospital care.
It will also assure doctors and hospitals of
being paid. * * * You are no doubt familiar
with the racket in drugs being investigated.
* * * It's pretty hard for the poor to pay
as much as 500 percent on drugs as indi-
cated by the * * * investigation.
A retired man in my district wrote of
the plight of the elderly:
These people are badly neglected. They
built this country. I, myself, worked hard
for 12 cents per hour, 10 hours a day and
6 days a week, and raised a family. * * *
How could I possibly have saved any money
to take care of my old age?
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A 72-year-old womanneeding an op-
eration for which she was unable to pay
wrote:
To get public health care I would have to
sign my house over to them and I don't
think this is fair.
A man 78 expressed the need eloquent-
ly when he wrote: -
I need medical attention at times that is
high. Medicine is higher. My $69 doesn't
go for luxuries, I assure you. I pray you can
do something about this. -
How does one answer such letters, Mr.
Speaker? -
Not by words. Words are empty in
such cases. In decency and humanity
we must answer them by action. -
Consider these letters for a moment, or
any other of hundreds and thousands
like them which come in to us.
We learn something here about the
new status of our- elderly. What is this
new position the older citizens occupy?
For one thing, most of them want to
live independently. We have outlived
the era of three and four generations in
the same households.
For another thing, social security and
pension programs are giving our elderly
limited means to live independently, ex-
cept when it comes to meeting medical
expenses. -
Great advances in geriatrics have giv-
en us the key to making old age a more
golden time of life than it has ever been.
Is this key to -be denied millions? Is it
to be given to millions more only in ex-
change for their last scrap of dignity and
modest comfort, in exchange for poverty
and despair?
There is something dreadfully wrong,
morally wrong, Mr. Speaker, in -a system,
which has achieved the greatest stand-
ard of medical care in the world, yet
serves all too many only at the price of
theirentire life savings.
Medical science can do wonders in
making the older years the best years if
we can bring these advances to every
elderly man or woman, husband and wife,
in such a way that their modest retire-
ment income can be left unencumbered
to be spent for food, clothing, shelter,
and small comforts. -
The Forand bill will give this new life
to our aged. It will give them the hos-
pital and nursing home care and the
medical and surgical treatment they
need.
Critics tell us such a program is un-
derfinanced. This argument begs the
question. Let us, all citizens, finance It
at whatever social security payment rate
be required. The savings and peace of
mind will be well worth it for every
citizen.
Critics tell us we lack the hospitals
and doctors for such a program. Mr.
Speaker, we have lacked adequate hos-
pital beds and a sufficient number of
physicians for some years now and it
is about time we build the hospitals and
train the physicians necessary for the
needs of all citizens of whatever age.
This is the very least the greatest nation
on earth can afford.
Critics tell us private Insurance can
meet the need, yet only a mere handful
of insurance companies provide any serv-
ice whatsoever for the elderly and most
elderly can neither afford nor qualify for
private policies.
Critics tell us such a program of bene-
fits will cause peogle to go to the hospital
unnecessarily. Tle simple device of re-
quiring- a $5 or $..5 fee to cover initial
administrative cats and a possible re-
quirement that the program run from
the third day of hospitalization to the
365th would render such complaints as
idle as they are heartless. -
The inexplicable fact remains that the
administration ha 3 proposed nothing to
meet this need.
The administration left its own Sec-
retary of Health, Education, and Wel-
fare, an able mar. of social conscience,
out on a limb anc then sawed the limb
out from under h n by refusing to ap-
prove any plan whatsoever, thereby
compelling the Seretary to sit in pain-
ful silence when - his Department, the
arm of Federal Government dealing
most intimately with matters of health,
was asked for its views. -
If a real program is blocked by the
administrationand the subject-does-find
its way into the c mpaign, it will be as
justified a domes ;ic issue as was ever
placed before the American electorate.
The simple fact is that we need a
forward-looking b. 11 of the Forand type.
I and many o." my colleagues, Mr.
Speaker, stand ready to consider re-
finements, improv(ments, and even com--
promises in this program within the
broad concepts of the Forand bill.
First, however, we must bring this
bill to the House fl. nor.
I hope and prey that there will be
affixed to the petition the 219 signatures
necessary to do th .s.
In the interest o F decency and human-
ity I urge that this be done.
Mr. MADDEN. Mr. Speaker, I move
the previous question on the resolution.
The previous question was ordered.
The SPEAKER. The question is on
the resolution. -
resolution was agreed to.
Mr. VINSON. Mr. Speaker, I move
hat the House resolve- itself into the
f the bill (H.R. '.0959) relating to the
mployment of retired commissioned of-
or other purposes,
-
The motion was : Lgreed to.
Accordingly, the House resolved itself
into the Committee of the Whole House
on the State of tt e Union for the con-
sideration of the bill H.R. 10959 with Mr.
FORAM) in the chair.
The Clerk read t'ie title, of the bill.
By unanimous c 3nsent, the first read-
ing of the bill was dispensed with.
Mr. VINSON. Mr. Chairman, I yield
myself 40 minutes.
(Mr. VINSON risked and was given
permission to revi e and extend his re-
marks.) - -
Mr. VINSON. Mr. Chairman, I con-
sider this one of the most Important
bills that the Howe will consider during
this session; so, therefore, I am bold
enough to respectf illy request the atten-
tion of the membership while I try to
explain the various provisions of this bill
so that it will enable you to reach an
independent viewpoint when the vote
comes. -
. Mr.' Chairman, the subject of the
Improper use of influence by former
Government officers in connection with
Government purchases is not new.
The Congress of the United States has
heard charges, year in and year out, for
as long as I can remember, about ex-
Government officials influencing the de-
cisions of active Government officials.
As a matter of fact, I know of no
words that arouse the ire and wrath of
the Congress to a higher degree than
that of "influence peddling."
Recently, a new allegation has arisen
concerning the employment of retired
military officers, particularly those of
high rank.
These allegations have increased al-
most in direct proportion to the increase
in the defense budget.
Prior to World War IT, the matter
received scant attention, even though a
statute was enacted as long ago as 1896
prohibiting the payment of appropriated
funds to active duty naval officers if
they were employed by any person or
company furnishing naval -supplies or
war material to the Government.
This law also prohibits the payment of
retired pay to retired regular naval offi-
cers who are engaged in selling, con-
tracting, or negotiating for the sale of
naval supplies or war materials to the
Navy Department.
Since 1923, retired Regular Army
officers have been subject to the loss of
retirement pay for the 2 years following
retirement if they engage in selling or
negotiating for the sale of supplies or
war materials to the Department of
Defense.
Because of the various .interpretations
placed upon the word "sell," and the in-
terpretations- placed upon the words
"supplies" and "war materials," these
limitations do not appear to be satis-
factory deterrents to the possible exercise
of improper influence in defense pur-
chasing.
As the defense budgets have grown in
recent years, and as the number of re-
tired officers has increased, more and
more defense supporting industries have
turned to retired military officers for
their aid and assistance in producing the
products so vital to our security.
Today there are about 47,000 Regular
officers of the Army, Navy, Marine Corps,
and Air Force on the retired lists.
In addition, about 5,000 Regular offi-
cers now retire each year.
An increasing number of Reserve offi-
cers with 20 years of active duty to their
credit are also retiring.
The number of Reserve officers on the
retired list will increase sharply in 1961,
20 years after the beginning of World
WarII. -
I mention this because it is Important
that we bear in mind the total number of
retired personnel who may be affected by
whatever legislation we enact.
There are more than 100,000 officers on
'the retired lists-from all sources and all
services, and in all grades, who. would be
affected by this bill. -
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Mr. Chairman, we are dealing with a
highly emotional subject. Every time
the question is raised for discussion;
rumors begin to fly throughout the width
and breadth of Washington concerning
the alleged influence these officers have
on the procurement of defense items.
Last year, when the Defense Appro-
priation Act was" being debated, an
amendment was offered on the floor of
the House that would have barred the
employment of retired officers by de-
fense contractors, and prohibited pay-
ment to those contractors who employed
retired officers within a period of 5 years
after separation from active duty not-
withstanding the type of work they did.
Fortunately, this amendment was de-
feated, but it sounded a clarion call that
the House was again aroused about re-
tired officers of the military services who
are employed in defense supporting in-
dustries.
Many persons are convinced that re-
tired officers influence the sale of defense
items to the Nation and by inference it
is implied that such items are unneces"
sary overpriced, or are tainted in one
form or another.
The Committee on. Armed Services
took cognizance of the fact that this
House wanted a thorough inquiry into
the whole question of the employment of
retired officers by the defense supporting
industries.
I assigned this difficult, complex, emo-
tion-packed subject to the special in-
vestigating subcommittee of our commit-
tee, under the chairmanship of the very
able and distinguished gentleman from
Louisiana [Mr. HEBERT].
The Hebert subcommittee began its
hearings on July 7, 1959. They released
their very thorough final report, which
I approved, on January 18, 1960.
The subcommittee conducted a sur-
vey of 72 of the largest defense support-
ing companies to determine the number
of retired military officers employed by
these contractors.
The survey discolsed that there were
1,426 retired officers employed by these
72 companies. Of these 1,426 officers,
251 were retired generals or admirals.
The subcommittee, in my opinion, did
an outstanding job in analyzing the en-
tire problem.
In fact, no subcommittee could have
worked harder in its effort to bring into
proper perspective all of the complex-
ities surrounding the matter.
The subcommittee filed its report on
January 18, 1960,. and then submitted a
bill to the full committee in order that
the full committee might share its com-
bined judgment with that of the sub-
committee in an effort to present to this
House a recommended solution to the
problem.
Mr. Chairman, we all know what we
are trying to prevent.
We are trying to prevent retired of-
ficers, and particularly retired officers of
high rank, from using their past con-
nections with the military services in
such a way as to influence the selection,
or purchase, by the Government, of an
item manufactured by the company for
whom they work.
Now this is what we are trying to stop.
We are trying to stop influence from
being improperly exercised by retired of-
ficers of high rank.
But note this: The subcommittee, after
inviting every Member of the House to
testify, and after hearing the testimony
of Members and others, did not disclose
a single instance in which an officer, re-
tired from the military service, had exer-
cised influence on someone in Gov-
ernment to the extent that the prod-
uct manufactured by his company was
selected.
No evidence of improper use of influ-
ence was disclosed.
Notwithstanding this, everyone seems
to be in accord that "improper influence"
either exists or comes so close to exist-
ence as to be identifiable.
Even though no case was established-
In. fact, even if no influence has ever been
exercised by any retired officer on the
procurement of any item by any armed
service-nevertheless, it is time for the
Congress to write a law that will make
the improper use of influence by retired
military officers much less likely than
that which may be possible under pres-
ent law.
Our objective, then, is to deflate influ-
ence, publicize its availability, lessen its
marketability, and yet preserve human
dignity and the defense effort.
Now, how do we accomplish these ob-
jectives in the bill before the House
today?
Well, here is what the committee bill,
H.R. 10959, as reported by the Commit-
tee on Armed Services, will do.
First. The bill says that a commis-
sioned officer,-other than an officer who
served on active duty for less than
8 years, who, within 2 years after re-
lease from active duty, for himself or
any other person, engages in any trans-
action the purpose of which is to sell
or to aid or assist in the selling of any-
thing to the Department of Defense shall
not be entitled to receive his retired pay
while employed during this period.
Second. It provides that a retired com=
missioned officer who agrees to accept
compensation from anybody in any
transaction, the purpose of which is to
sell or to aid or assist in selling any-
thing to the Department of Defense,
shall file a statement with the Secretary
of the Department concerned, of the
fact and time of such agreement, to-
gether with such additional information
concerning the duties to be performed in
such transaction as the Secretary may
require.
If there is any change in his status,
after filing this information, he is re-
quired to notify the Secretaries of the
Departments concerned.
Third. Each of the Secretaries of the
Military Departments will be required to
establish an enrollment office for the fil-
ing of the information required by the
proposed legislation.
The information obtained will be open
to public inspection-and this, I might
add, is important.
Finally, a person, firm, or corporation
awarded a defense contract shall, as soon
as the contract has been awarded, ad-
vise the Secretary concerned of all re-
tired military officers employed by said
contractor. The prime contractor is re-
quired to obtain this information from
his subcontractors.
The proposed legislation also provides
that all invitations for bids or proposals
must contain this information.
Any retired officer, or company, who
fails to comply with the provisions of
the proposed legislation will have his re-
tired pay, or contract payments, which-
ever may be the case, suspended until
the information is furnished.
Now, in addition to this, the House
will note that the word "sell" has been
broadened from existing law to include
aiding or assisting in the selling of any-
thing to the Department of Defense.
Existing law is confined to "supplies or
war materiels" and is susceptible to
many interpretations.
Finally, the proposed legislation re-
peals a Navy statute which puts a life-
time ban on the receipt of retired pay
for Navy and Marine Corps officers who
sell naval supplies or war materiel to
the Navy Department at any time after
their retirement.
All retired officers will be subject to the
same 2-year ban after retirement un-
der the proposed legislation if they en-
gage in any transaction, the purpose of
which is to sell or to aid or assist in the
selling of anything to the Department
of Defense.
In the report, we define "selling" as
"all negotiations which bring a contrac-
tor and his representative into contact
with officials of the Department of De-
fense or to the Armed Forces for the
purpose of obtaining contracts from
those Departments for the procurement
of tangibles or intangibles in existence
at the time or to be produced in the
future. The participants in such trans-
actions are a part of that process."
Now what have we accomplished?
First,, we make the laws uniform for
all retired officers.
Today the law is different for the
Navy than it is for the Army and Air
Force, and it is different for the Reserve
than it is for the Regular, even though
their retired pay may be the same.
Second, we say to a retired officer
that for 2 years following retirement or
release from active duty he may not, for
himself or for any other person, engage
"in any transaction, the purpose of which
is to sell, or to aid or assist in the selling
of anything to the Department of De-
fense or an armed force of the United
States."
If an officer, notwithstanding that
caveat, does engage in selling, or aids or
assists in the selling of anything to the
Department of Defense or an armed force
of the United States, he may not draw
his retired pay, for ,2 years following his
retirement, while so employed.
Now that is not all that this bill does.
It also broadens the definition of selling
to include all transactions which result
in contracts with the Department of
Defense.
But beyond that, it requires retired
officers who receive compensation from
any company for any transaction the
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purpose of which is to sell or to aid or
assist in selling anything to the Depart-
ment of Defense or an armed force of
the United States after he enters into
that agreement, to file a statement with
the Secretary of the Department with
which he intends to do businessstating
the fact and time of such agreement and
any other additional information con-
cerning his duties the Secretary may re-
quire.
And this is also true if he engages in
business for himself.
A retired officer after filing this in-
formation is required to notify the Sec-
retaries of the Departments with which
he does business, of any change in his
status.
This will be a permanent requirement,
with no expiration date.
Now this is to be the requirement im-
posed by the proposed law on the re-
tired officer. If the officer fails to com-
ply with this proposed requirement, there
is no question that he can be court-
martialed under the Uniform Code of
Military Justice.
But, in addition to this, the Secretary
of each Department will establish an
office for the enrollment of retired offi-
cers who are requested to furnish the
information I have just mentioned.
Officers now on the retired list within
6 months after this bill becomes law will
be furnished a suitable form upon which
the information required may be sup-
plied.
So far, what I have discussed con-
cerns the enrollment of retired officers
who are engaged in selling, or aiding
or assisting In the sale of anything to
the Department of Defense.
Thus, this is what the law imposes
upon the retired officer.
But the bill also says that any com-
pariy awarded a defense contract shall
advise the Secretary concerned in the
Department of Defense of all retired
military officers employed by said con-
tractor.
.And it even goes further to say that
the prime contractor must obtain simi-
lar information from the subcontractors
and file that information with the Sec-
retary concerned. This requirement will
also be included in all invitations for
bids and proposals.
The retired officer who fails to comply
with the provision of this section can
have his retired pay suspended until the
information is furnished; and the con-
tractor who fails to file the information
can have his contract payments sus
pended until the information is fur-
nished.
We thus deflate influence by pub-
licizing its availability, and as a result,
reduce its marketability.
Now, Mr. Chairman, on Tuesday,
April 5, the Committee on Armed Serv-
ices met in open session.
At the request of the distinguished
gentleman from Texas [Mr. KILDAY], the
committee at that time adopted a sub-
stitute bill, which Mr. KXLDAY will offer
at the conclusion of the general debate
on the bill before the House.
At the same time the committee re-
jected, by a vote of 24 to 10, a substitute
bill offered by Mr. HEBERT, which sought
to impose a criminal penalty, as a part
of the criminal code, upon any retired
officer who engaged in selling within 2
years after retie ement, or any company
who employed such a retired officer.
After rejecting the substitute offered by
Mr. HEBERT, the committee, by a vote of
25 to 8, adopted the substitute bill of-
fered by Mr. KILDAY which was intro-
duced yesterday. and is now H.R. 11576.
The substitute: bill, which Mr. KILDAY
will offer, contains the identical lan-
guage of H.R._10959, which is now before
the House for g(neral debate, except for
three important additions.
Thus, the substitute provides that a
retired officer who engages in any trans-
action, the purpose of which is to sell
or to aid or assist in selling anything
to the Department of Defense within
any time durint; the 2-year period fol-
lowing his releas e from active duty, shall
forfeit 2 years of his retired pay.
Mr. HEBERT. Mr. Chairman, will
the gentleman yield?
Mr. VINSON. -I yield to the gentle-
man from Louisiana..
Mr. HEBERT. Did you not also go
further and ad~)pt the language which
I submitted, and make the act an un-
lawful act?
Mr. VINSON. We made the act an
unlawful act yesterday.
Mr. HEBERT. That is correct. That
was the language of my proposal. You
adopted my wo ^ds, "It shall be unlaw-
ful."
Mr. VINSON. The Armed Services
Committee is indeed fortunate that it
has the benefit of the counsel and ad-
vice of our di tinguished friend from
Louisiana. We profit oftentimes by his
words, and I say that sincerely.
Mr. HEBERT. But you did adopt my
language.
Mr. VINSON. If we did, we thought
it was languag(: that was correct. We
adopt anyone's !anguage, irrespective of
the source, if wE think it is correct. We
reject that, no matter where it comes
from, if we.thinl: it is wrong.
Mr.. HEBERT But you did adopt it.
Mr. KILDAY. Mr. Chairman, will the
gentleman yield?
Mr. VINSON. I yield to the gentle-
man from Texa,.
Mr. KILDA'I. I suppose I should
say, inasmuch is the proposed substi-
tute which the ?:entleman says bears my
name was adopted, that you did adopt it.
Mr. VINSON, That is right.
Mr. HEBERT. -I thank the gentle-
man from Texas very much. It would
be so much simpler if our chairman was
so direct.
Mr. VINSON. I wanted to compli-
ment the gentleman. I did not want
just to say "Yes " That would not have
been sufficient.
The substitute bill adopted by the
committee makes it unlawful for any
commissioned of Icer of the Armed Forces
of the United States, within 2 years
after release from active duty, to en-
gage in any tra isaction, the purpose of
which is to see: or to aid or assist in
the selling of anything to the Department
of Defense.
Now why do we make this unlawful?
Well, we make it unlawful so that
there will be no question that a retired
officer who actually engages in any
transaction, the purpose of which is to
sell or to aid or assist in the selling of
anything to the Department of Defense
within the 2 years following his release
from active duty, subjects himself to the
jurisdiction of a court-martial.
The Uniform Code of Military Jus-
tice, under, article 134, permits the
armed services to court martial a re-
tired officer of a regular component
who brings discredit upon his service.
An officer who commits an unlawful act
under the substitute bill will bring dis-
credit upon his service, and thus subject
himself to court martial under the Uni-
form Code of Military Justice.
Under the bill now before the House,
it would be possible for a retired officer
to be employed for 1 month, in violation
of the law, and only lose 1 month's re-
tired pay.
The substitute bill imposes a clear loss
of 2 years of retired pay upon any retired
officer who, within 2 years following his
release from active duty, engages in any
transaction the purpose of which is to
sell or to assist or.aid in the selling of
anything to the Department of Defense.
The forfeiture under the substitute bill
will be clear; the forfeiture will be mean-
ingful; the forfeiture will mean the loss
of 2 years of retired pay.
And, finally, the substitute bill, to re-
move any doubt, adds a new section 3
which provides that any retired commis-
sioned officer subject to the Uniform Code
of Military Justice who violates any pro-
vision of the proposed legislation shall be
tried by court-martial and, upon con-
viction, shall be punished as the court-
martial shall direct.
Thus, the substitute bill imposes a
clear 2-year loss of retired pay; it makes
a transaction involving the sale of any-
thing to the Department of Defense with-
in 2 years following release from active
duty unlawful; and, finally, any retired
officer who violates such a provision of
law will clearly be within the provisions
of the Uniform Code of Military Justice,
and thus subject to court-martial.
It also contains the identical require-
ments with regard to the enrollment of
retired officers and the publication of
such information as is contained in the
bill now before the House.
Now, Mr. Chairman, I think there is
unanimous agreement on what we are
trying to accomplish.
There are some, I am sure, who will
insist that any retired officer who en-
-gages in selling or assists or aids in sell-
ing anything to the Department of De-
fense following his retirement should be
branded a criminal.
The Committee on Armed Services is
of the opinion that its approach is proper
and effective, and can accomplish the de-
sired result without resorting to criminal
sanctions.
What we are dealing with here involves
a question of morals, and the conduct
of men who, for the most part, have, for
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more than 30 years, held in their hands
the responsibility for the defense of the
Nation.
- If we adopt a law which makes it a
crime we will deny these men hereafter
retired the right to earn a livelihood in
the one field in which they are experts,
because no reasonable, honorable, in-
telligent man will go mountain climbing
on the jagged and unknown edges of the
criminal code.
No intelligent man, and certainly no
honorable man, would consider exposing
himself and his family to the possible
loss of his reputation by being branded
a criminal.
No sensible man will knowingly en-
gulf himself in a rubber-band law that
can be stretched to include him, and
snapped to break him.
The loss of retired pay for 2 years,
the public disclosure of those who are
engaged in selling, exposure to military
court martial, together with the disclos-
ure of those who work for defense-sup-
porting industries is a reasonable, sound
approach to the problem we seek to
solve.
But if we make this law a part of the
criminal code, we will do grave injury
to the defense efforts of the Nation.
These men have a special type of
knowledge that is valuable to our de-
fense effort.
We must protect anything that aids
our defense effort.
But of even greater significance Is the
fact that we will deny to the Nation the
special knowledge that these men have
acquired If we convert this proposal to
a criminal statute.
In our struggle with world commu-
nism, and in this age of galloping tech-
nology, during this transition period
from the conventional field to the mis-
sile era, we can use every ounce of gray
matter that is in the heads of our citi-
zens.
A criminal statute will become an iron
curtain for 2 years to the utilization of
this great talent within these individ-
uals.
We cannot afford to jeopardize our
defense efforts at this critical point in
our history by making it a crime for a
retired officer to be employed by a de-
fense-supporting industry.
The Committee on Armed Services
does recommend that we deprive an in-
dividual of his retirement pay for 2
years if he engages in any transaction,
the purpose of which is to sell or. to aid
or assist in the selling of anything to
the Department of Defense. We do rec-
ommend that he be subject to court-
martial.
But we do not recommend that such
action subject an officer to criminal
sanctions.
The Committee on Armed Services
agrees that we must make every reason-
able effort to deflate any possible use of
influence. We state very clearly, in the
committee substitute, which I have pre-
viously discussed, that an officer who vio-
lates any provisions of the proposed
legislation will be subject to court-
martial.
Mr. Chairman, I do not believe that
any of us wants to injure the security
efforts of the Nation by depriving the
nation, through its defense contractors,
of the services of men who make highly
significant and extremely valuable con-
tributions to our security interests.
Because we sense that there is some-
thing unethical about an officer imme-
diately following his retirement engag-
ing in the actual sale of anything to the
Department of Defense, I think it is
proper that we expose him to court-
martial and the loss of his retired pay
for a period of 2 years should he engage
in that kind of activity.
We all want to stop any possible un-
ethical exercise of influence by retired
officers, and anyone else as far as that
Is concerned, but In our effort to solve
a problem that so far has not been iden-
tified, let us not create another obvious
problem by bringing about an irreparable
break in the defense efforts of the
Nation.
In an effort to solve the headache of
influence peddling, let us make sure that
the solution consists of proper medicine
to eliminate the headache, and not de-
capitation. Both have the same results,
but each employs a different method of
procedure.
Mr. Chairman, we believe that the
substitute bill that will be offered by the
distinguished gentleman from Texas
[Mr. KrLDAY], and which has been ap-
proved by a vote of 25 to 8 by the Com-
mittee on Armed Services, is the proper
solution and the proper approach to this
entire matter. '
We ask the House to support this sub-
stitute bill when it is offered.
Mr. WHITTEN. Mr. Chairman, will
the gentleman yield?
Mr. VINSON. I yield.
Mr. WHITTEN. As the gentleman
knows, I am a member of the subcom-
mittee handling defense appropriations.
As I read this bill the question that
arises in my mind is that the bill is
limited to selling. The gentleman, of
course, is familiar with the instance
where high ranking officers were enter-
tained by the Martin Company in Ber-
muda, high ranking military officers who
may not be selling but who may have
great influence in determination at the
policy level in the Defense Department
as to which company will get which con-
tract. In that case they were Regular
officers. It strikes me that this bill does
not touch a situation which could result
in far greater expense to the country
than the influence of a man who might
actually be selling material. I just won-
der if the gentleman investigated that
feature of it.
Mr. VINSON. The Committee on
Armed Services has an immense amount
of responsibility. We cannot do every-
thing in 1 day at one time. We are
working all the time, when Congress is
in session and when Congress Is not in
session. We will try to look into that
phase. It is a very pertinent question.
I was shocked, we all were shocked,
when these high officials who have the
power to grant contracts began frater-
nizing with officials of the interested
companies.
Government officials must be like
Caesar's wife, above suspicion. That is
probably one reason why I myself do not
accept many engagements. When the
sun goes down I. generally go home and
stay there. I just do not want to be
placed in an atmosphere such as that.
I thank the gentleman for his sug-
gestion. We will try to follow it out.
We will look into it, but we cannot look
into it in this bill right now.
Mr. WHITTEN. If the gentleman will
yield further, does the gentleman believe
our Appropriations Subcommittee should
look into that area with regard to fix-
ing limitations on these funds? That is
our responsibility.
Mr. VINSON. I will say that is not
the way to legislate.
Mr. KILDAY. Mr. Chairman, will the
gentleman yield?
Mr. VINSON. I yield:
Mr. KILDAY. The instance to which
the gentleman from Mississippi refers
involved officers on active duty..
Mr. VINSON. That is right.
Mr. WHITTEN. May I say the point
I was getting was that "selling" in the
bill is a limited and narrow field, and. if
we confine the bill to that we are prob-
ably letting off those whose actions may
have a much bigger effect on the cost of
contracts.
Mr. KILDAY. What I wanted to say
was that adequate authority now exists
for the punishment of persons on ac-
tive duty. Adequate authority exists
with the executive branch of the Govern-
ment to discipline even civilians, as the
Chairman of the Federal Communica-
tions Commission recently learned to the
extent of forcing his resignation; and
the Uniform Code of Military Justice
contains a number of specific provisions
under which the Department can pro-
ceed. The President can proceed in his
own right as Commander in Chief
against an officer on active duty with
practically no limitation on what he
does.
Mr. WHITTEN. I would like to clean
this up.
The point I was making is this: I refer
to the penalties in this bill which, in the
first place, are limited to losing retired
pay for 2 years. If he is getting $100,000
a year in salary that is not important.
Mr. VINSON. He is subject to court-
martial.
Mr. WHITTEN. I quote: "Who is to
sell or to aid or assist in the selling of
anything to the Department." If a re-
tired admiral or general, and there are
some in that category, have sufficient in-
fluence that at the Defense Department
level they can convince them as to
whether they should go for submarines
or for carriers or Bomarcs or go for
another missile, it may be 10 times more
expensive in dollars. But apparently he
would not be covered under this bill.
Mr. VINSON. I think the language is
so broad that it would cause a great many
retired officers to hesitate to ever walk
into the Pentagon again.
Mr. LINDSAY. Mr. Chairman, will
the gentleman yield?
Mr. VINSON. I yield to the gentle-
man from New York.
Mr. LINDSAY. The key word here is
"transaction." Supposing you had a
retired officer who was seeking to obtain
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a contract for research purposes only,
service purposes, but a very lucrative one,
where there are no sales as that term is
generally used. Would this bill cover it?
Mr. VINSON. I would say if the word
"sale" is strictly interpreted, if it.con-
tributed to giving birth to anything, I
would say that it is possible.
Mr. LINDSAY. I have one more ques-
tion, if the gentleman will yield further.
Why is it necessary-and I am really
looking for enlightenment on this-to
broaden this out to a transaction involv-
ing sales in every area? Why would you
not cover the purpose by limiting the bill
to those areas where the retired officer
had previously had some jurisdiction or
responsibility?
Mr. VINSON. We want to stop this
constant talk that there is influence ped-
dling. The country is concerned and
also the Congress, and there must be
some justification because of all this
smoke that -rises every year on this sub-
ject matter, that the time has come to
write some law with teeth in it to stop it,
and the committee has brought in a bill
that can accomplish it.
Mr. GROSS. Mr. Chairman, will the
gentleman yield fora question to clarify
this situation?
Mr. VINSON. I yield.
Mr. GROSS. There is no use to pay
any attention to H.R. 10959, then.
Mr. VINSON. You are correct.
Mr. GROSS. The bill that the gentle-
man now supports Is what, H.R. 11576?
Mr. VINSON. That is right. That is
the bill that the committee yesterday,
25 members in the affirmative and 8 in
the negative, voted out, which will be
offered by the gentleman from Texas
[Mr. KXLDAY] to take the place of H.R.
10959.
Mr. GROSS. H.R. 11576 and the
amendments that the gentleman from
Louisiana will attempt to offer?
Mr. VINSON. I am talking about the
committee bill.
Mr. MEYER. Mr. Chairman, will the
gentleman yield?
Mr. VINSON. I yield.
Mr. MEYER. I would like a little
clarification as to the true objective of
this bill. In connection with the ques-
tion asked by the gentleman from Mis-
sissippi, are we trying merely to prevent
the officers from getting their retirement
pay and also serving in a defense indus-
try, or are we attempting to block any
possibility that there could be charges
made of influence peddling, collusion, or
corruption? What is the real objective?
Mr. VINSON. The real objective is to
stop all that the gentleman is talking
about. That is the real objective.
Mr. -MEYER. Then, how can we do
this if we merely stop him from getting
his retirement?
Mr. VINSON. Because he is also sub-
ject to court-martial, and that can in-
volve a penalty. My recollection is that
the maximum penalty in courts-martial
can run as high as 5 years. Now, I know
this: that, the way things are happening,
oftentimes in a Federal court a man has
a far better chance in that court than
he does before a court-martial. A court-
martial is a -pretty severe thing.
Mr. MEADER. Mr. Chairman, will
the gentleman yield?
Mr. VINSON. I yield to the gentle-
man.
Mr. MEADE] t. Mr. Chairman, first I
may. say that I have the privilege of sit-
ting on a subcommittee of the Commit-
tee on the Judiciary which has been con-
sidering conflict-in-interest legislation
and heard extensive testimony. This is
not an easy fled in which to legislate.
Mr. VINSON That is right; exactly.
Mr. MEADEI 1. My question relates to
the report of ti ;e Hebert committee. As
I recall it, the ?:entleman said that there
were some 1,421; retired officers employed
by 72 defense contractors.
Mr. VINSON That is right.
Mr. MEADE R. And of those there
were some 250 ;;enerals and admirals.
Mr. VINSON. That is right.
Mr. MEADER. Can the gentleman
tell me for wh rt function those retired
officers were ei aployed by those defense
contractors?
Mr. VINSONN. Of course, I do not
know. The questionnaire that we sent
out I had the l privilege of helping draft,
and contributed my limited, mediocre
ability to the shaping of It. We tried to
find out what they were there for and
we got some et:planation of it.
Mr. MEADER. Were any of them
salesmen?
Mr. VINSON. They said they did not
sell. But there is a gray area. It is an
area in which the Congress should legis-
late through this bill. If you pass this
bill you will accomplish something
worth while by stopping, at least, all of
this conversat on and newspaper talk
that something; crooked or improper is
going on in the Pentagon.
Mr. MEADEI t. If the admiral or gen-
eral became a salesman he would be
affected by this bill. But if he were
doing something else, perhaps as presi-
dent of the company, or if he were doing
something concerned with design or re-
search, he would not be touched by this
bill?
Mr. VINSOY. That is the reason I
read the definition of sale.
Mr. BECKEF;. Mr, Chairman, will the
gentleman ylel i?
Mr. VINSOI', I yield to the gentle-
man.
Mr.BECKEFI,. Mr. Chairman, I would
like to associal e myself with my distin-
guished chairman of the Committee on
Armed Service.; and compliment him for
the very able statement he has made.
I might say in conclusion that I have
done this without any persuasion by the
chairman, and willingly from the very
beginning.
Mr. Chairman, I compliment the gen-
tleman, the chairman of my committee,
for the very fl ne way he has presented
the matter ar..d I hope his views will
prevail.
Mr. VINSON. I thank the gentleman
and I trust the House will sustain the
Committee's position. Mr. Chairman, I
move that the Committee do now rise.
The motion w pas agreed to.
Accordingly, the Committee rose; and
the Speaker pro tempore, Mr. WALTER,
having assumed the chair, Mr. FORAND,
Chairman of the Committee of the Whole
House on the State of the Union, re-
ported that thnt Committee, having had
??400280008-9
.R. 10959 )
under consideration the bill ([
relating to the employment of retired
commissioned officers by contractors of
the Department of Defense and the
Armed Forces and for other purposes,
had come to no resolution thereon.
COMMITTEE MEETING DURING
SESSION OF HOUSE
Mr. MULTER. Mr. Speaker, I ask
unanimous consent that the Small Busi-
ness Committee may sit this afternoon
during general debate.
The SPEAKER. Is there objection to
the request of the gentleman from New
York?
There was no objection.
BROADCASTING IN THE PUBLIC
INTEREST -
(Mr. CELLER asked and was given
permission to extend his remarks at this
point in the RECORD.)
Mr. CELLER. In taking the floor
today, Mr. Speaker, I have no intention
to 'condone any of the grave abuses
which have cast discredit on the broad-
casting industry, or to deprecate the
need for remedial legislation. On the
other hand, -I feel that we will do well
if any such legislation is considered calm-
ly, in an atmosphere free from the heat
engendered by some of the more flagrant
disclosures. In this atmosphere there
has been a tendency for wholesale con-
demnation of broadcasters' practices,
whether justified or not. Too often we
are deterred by the Impact of -disclo-
sures of wrongdoing from examining the
total picture and recognizing positive
and significantcontributions in the pub-
lic interest. Yet, unless we evaluate the
entire picture-taking into account the
achievements of broadcasting as well as
its failures-we will be in no position to
legislate effectively in the public interest.
The dark side of the broadcasting pic-
ture is clear to see, and it is an unhappy
fact that the confidence of the American
people in the great broadcasting media
of radio and television has been severely
shaken. This is perhaps an inevitable
consequence of recent broad-scale rev-
elations of rigged quiz shows, of payola
in the exploitation of music, of deceptive
advertising in radio and television pres-
entations,
These revelations come on the heels of
earlier disquieting disclosures by the
Antitrust Subcommittee, of which I am
chairman, concerning seriously restric-
tive practices on the part of. networks
and others in the television broadcasting
industry and a tendency by the Federal
Communications Commission to identify
the functions of its office with the private
interests of those subject to its jurisdic-
tion.
On top of these reflections upon the
morality displayed by some persons in
the broadcasting industry, and upon the
discretion of those charged with the re-
sponsibility for industry regulation, come
charges leveled at the general quality
of broadcast programs. I, too, have
often been impelled to protest the lack of
taste and imagination which sometimes
characterizes broadcast programs.
April 6
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