Materials announced as acceptable in barter transactions for the supplemental stockpile on specified dates, July 1, 1956, through Mar. 27, 1962-Continued

On Dec. 9, 1959, a special announcement was made for offers of Indian metallurgical
manganese ore and/or ferromanganese produced from Indian ore.

On Jan. 7, 1960, a special announcement was made for offers of Turkish metallurgical
chrome ore.

On Apr. 7, 1960, USDA announced that ferrochrome processed from chrome ore origi-
nating in Turkey would also be acceptable under the announcement of Jan. 7, 1960.

On July 15, 1960, a special announcement was made for offers of tungsten carbide
powder to be processed domestically from ore originating in friendly foreign countries.
A special barter announcement was made on Oct. 14, 1960, for offers of ferromanganese
produced in Chile from Chilean ores or ores produced in friendly countries.

Beryllium metal and oxygen free high conductivity copper were added to the list of
eligible barter materials on Sept. 12, 1961. The announcement specified that the beryl-
llum metal must be processed in the United States, while oxygen free high conductivity
copper could be processed either in the United States or in friendly foreign countries from
ores originating in friendly foreign countries.

MATERIALS ACQUIRED FOR THE SUPPLEMENTAL STOCKPILE
WITHOUT PUBLIC ANNOUNCEMENT

The following materials were acquired for the supplemental stockpile by conversion
to a barter basis of strategic stockpile and DPA cash contracts:

Metallurgical manganese ore and rare earth sodium sulphate were accepted under a
government-to-government agreement between the United States and Brazil signed on
Jan, 6, 1961, This was in final settlement for wheat delivered to Brasil In 1904 by the
United Bistes under an agreement between the two countries on AOR. 20, 1054

Mr. COBURN. Mr. Rawlings, does the barter program include barter for any materials that are not on the strategic and critical list? Mr. RAWLINGS. Yes, sir, it does.

It provides, in conjunction with other agencies, for barter procurements of nondefense materials or for military items, as distinguished from the strategic and critical materials.

We may acquire those and turn them over to the other agencies on a reimbursable basis.

Mr. COBURN. Such as the Department of Defense?

Mr. RAWLINGS. Department of Defense. We have done some for Atomic Energy Commission.

I think we took some asphalt once for Public Roads, fertilizers under the aid program, and they reimbursed us.

Mr. COBURN. I have no further questions, Mr. Chairman.

Senator SYMINGTON. Senator Thurmond?

Senator THURMOND. No questions.

Senator SYMINGTON. Senator Bush?

Senator BUSH. Mr. Chairman, I have no questions of the witness, but before another witness is called, I would like to address the chairman and the committee very briefly.

Senator SYMINGTON. Thank you, Mr. Rawlings.

Senator BUSH. Mr. Chairman, I have received this morning a letter signed by Mr. Charles F. Barber, who is vice president and general counsel of the American Smelting & Refining Co., 120 Broadway, New York. He lives in Greenwich, Conn.

He writes me as from there:

DEAR SENATOR BUSH: As an officer of one of the important domestic producers of lead and zinc, I have been exceedingly concerned by suggestions which have been made in the course of the current stockpile hearings that the purpose and effect of the stockpile purchases of lead and zinc carried out during the period 1954-57 pursuant to the instruction from President Eisenhower were concealed from Congress and the public.

I was dismayed earlier this week to see the New York Times, in an editorial, lending support to this view.

As you undoubtedly know from your own experience, this is squarely contrary to fact. To document this, we have assembled a brief memorandum reviewing contemporaneous materials from the public record. A copy is enclosed for your information. As this memorandum shows, the stockpile program for lead and zinc was instituted as a result of a deliberate policy decision by President Eisenhower and as an alternative to tariff increases which had been recommended by the Tariff Commission.

I feel that it is important that this be understood so that an environment conducive to a careful appraisal of all the factors involved will prevail at such time as any legislation modifying existing procedures for disposal of metals acquired for the stockpile may be under consideration.

Yours sincerely,

CHARLES F. BARBER.

He enclosed a memorandum entitled "The Public Record on Lead and Zinc Stockpiling," in which he quotes, in part, from that editorial in the New York Times, and he goes on to speak of the program being announced by President Eisenhower on August 23, 1954, in identical letters to the chairmen of the Senate Finance Committee and the House Ways and Means Committee, explaining his decision not to implement the recommendations of the Tariff Commission for an increase in the duty on imports of lead and zinc, and he quotes from that letter somewhat extensively.

Secondly, he speaks of the nature and effect of the program being described to the Senate Finance Committee by the U.S. Tariff Commission on July-in July 1957-and he quotes from that.

Thirdly, he says the stockpiling program was reviewed in hearings before the Committee on Ways and Means, House of Representatives, on H.R. 8257, and other bills, on August 1 and 2, 1957, and quotes the Under Secretary of the Interior at that time.

Fourthly, the stockpile program, he said, was reviewed by the Tariff Commission in the course of hearings on lead and zinc which were held in November 1957, and he submits an appendix which deals with that review.

He also refers to the Senate Interior Committee having heard testimony on stockpiling of lead and zinc in 1958.

And, finally, the stockpiling program, he said, was reviewed in connection with the hearings on lead and zinc before the Tariff Commission in January 1960.

And he presents annexes to this memorandum which go into detail regarding these various elements of testimony.

Mr. Chairman, as long as this matter was discussed at the last Friday hearings and the New York Times editorial was inserted at that time, I should like to submit this letter with the memorandum and the supporting data to the chairman and counsel with the request that this be included in the record of last Friday, where it seems to me it would be appropriate to be placed in the record.

Senator SYMINGTON. We will place it in the record at this point. Senator BUSH. Not in Friday's record?

Senator SYMINGTON. I do not know what the custom is on that. If it did not come up on Friday, it would still be part of the record if we put it in today.

Senator BUSH. If the chairman prefers to have it in today's record. that is all right with me.

Senator SYMINGTON. It would be all right with me to do it on Friday.

Senator BUSH. Whichever is convenient to the chairman and counsel is satisfactory to me.

Senator SYMINGTON. Whatever the rules of the full committee are, I will say to the Senator from Connecticut we will be glad to observe them.

(The document referred to is printed on p. 1284.)

Senator SYMINGTON. I would ask this question:

Did the Senator get from this letter the inference that purchases of lead and zinc were not secret for the stockpile?

Senator BUSH. I get from the letter that the policy, the whole policy, there was nothing secret about the policy, and that it was repeatedly stated in open meetings before various committees of the Congress and by various authorities of the Government including the Tariff Commission and the Under Secretary of the Interior.

So I would say one might justifiably draw the conclusion that there was no secrecy about the fact that we were accumulating a tremendous stockpile and just how we were doing it.

Senator SYMINGTON. I am glad to have the Senator's introduction, but we have already placed in the record documents which show, with

respect to a tariff, that there was major disagreement within the administration.

As I remember it, Secretary of the Treasury Humphrey was for an increase in the tariff; the Secretary of State, Mr. Dulles, was against an increase; and the President supported the Secretary of State.

It does happen, and I believe the company that the Senator read a letter from, an officer, is that correct

Senator BUSH. Yes, sir, the vice president and general counsel of the American Smelting & Refining Co.

Senator SYMINGTON (continuing). They said in an executive meeting their representative stated they had a good idea of what the stockpile requirements were.

Also, the aluminum people said they had a good idea.

On the other hand, the head of Climax Molybdenum testified he never knew what the objectives were for molybdenum in the stockpile. It has been rather difficult to find out just what was known, especially when there was disagreement in the metal trade. Naturally, that would extend even further among the general public.

I am told by staff that purchases were not secret. It was the objectives that were secret, and the buying against those objectives, which, as has been developed, constantly changed in amount of objective.

In this connection, counsel submitted and I would like to make part of the record a statement about prices. There have been criticisms of this committee's efforts to develop the facts on the ground it might affect the markets. I would like to read this memo as of June 30, 1962, signed by Mr. Coburn.

The price on aluminum, January 1, 1962, was 24 cents a pound. The price June 21, 1962, is 24 cents a pound. That is to me especially a surprise because of the sharp break in the stock market.

Copper, the price January 1, 1962, was 30.6 cents a pound. Copper price June 21, 1962, was the same, 30.6 cents a pound.

Lead, the price January 1, 1962, was 10.25 cents a pound. January 5 of 1962, it was 10 cents a pound. February 1, 1962, 9.75 cents a pound. On February 9, 1962, it was 9.5 cents a pound. That was before these hearings started. June 21, 1962, 9.5 cents a pound.

Zinc, January 1, 1962, 12 cents a pound; April 2, 1962, 11.5 cents a pound; June 21, 1962, 11.5 cents a pound.

Rubber, about a quarter of a cent a pound higher on June 1, 1962, than on January 1, 1962.

I only mention those because we would not want this committee to be having any major effect on the market, especially as the President has consistently reiterated it was his intention to see the disposal orderly. I will be glad to put into the record, in connection with whatever the rules are, the letter from the Senator from Connecticut.

Senator BUSH. I am very glad to hear these figures. I hope this does not indicate that the stockpile has been supporting the market through this time.

Senator SYMINGTON. That is something I would rather have other people decide, after we have made the full record.

Senator BUSH. I was not asking the chairman to comment. I just expressed the hope, knowing how abundantly we supplied the stockpile, that we have not been supporting those markets.