Senator PAYNE. Mr. Chairman, I think in fairness to the witness, that perhaps that statement of Secretary Weeks might be read for his benefit, to see if he is in agreement with it. If he has not seen it, it is a little unfair to ask whether or not he is in accordance with that same statement.

The CHAIRMAN. I hope we are not going to get to the point in this administration where every witness that comes up here has to say exactly the same thing, and has to be in exact agreement with every other witness. If we do, then I think we might as well have 1 instead of 8 or 10 or 12 Cabinet members. If they are all going to agree before they come up here and simply sit there and act as parrots and say, "Well, we agree with what the other fellow says."

I do not quite get the reasoning behind that sort of thing, because I think this gentleman ought to have the right to speak his own thoughts and give his own ideas, and his own expression. He ought to stand on his own feet and not be bound by anything that Mr. Weeks or anybody else said.

I do not quite understand that sort of management or that sort of arrangement or that sort of policy. Now, maybe it is good, but if we are going to have that sort of thing, then let us just have one witness from the administration come up and save all this time and effort. Let him come up and say, "This is our program," period, and let it go at that.

I thought we were holding hearings for the purpose of getting the benefit of the best thinking of as many people as we possibly could. Now, maybe I am wrong.

Senator BENNETT. Well, the reason I projected this into the discussion is that when we come into executive session to consider this bill, I wanted to make absolutely sure that if it were said that Secretary Weeks testified thus and so, and he was contradicted by the Secretary of the Interior, that both of them, in effect, knew what the possible implications of their testimony would be.

There was a good deal of discussion in this committee, in an attempt to persuade Secretary Weeks yesterday to retreat from his position that civilian allocations were not necessary under the present circumstances. I thought the Senator from New York was proceeding to develop that same point of view today. Since we devoted so much time to it yesterday, I was anxious to make it perfectly clear—I am not trying to put words in the Secretary's mouth. I am simply trying to clear up in my own mind what his position is, and to point out that there might be an implication that these two members of the Cabinet were in disagreement on this rather vital subject.

The CHAIRMAN. I see no wrong with them being in disagreement, because we have got to settle the matter in the Congress and pass the legislation.

My observation all my life has been that it is a good idea to be in disagreement, in order to bring out the best, in order to accomplish the most, because I think the most dangerous man in any organization, and that goes for the Government, and the Cabinet, is a "yes man,” a man who agrees with what everybody else says.

Here is what Mr. Weeks said:

To so restrict the use of title I powers to military production, repeal is recommended of sections 701 (c), 714 (f) (3), and 714 (f) (4) of title I of the Defense Production Act, and the addition of a new section reading:

"The powers granted in section 101 shall not be used to control the general distribution of any material in the civilian market unless the President finds (1) that such material is a scarce and critical material essential to the national defense, and (2) that the requirements of the national defense for such material cannot otherwise be met without creating a major dislocation of the normal distribution of such material in the civilian market to such a degree as to create general hardship."

I think that is what you said.

Secretary MCKAY. That is right.

The CHAIRMAN. Let us make sure we all understand what Mr. Weeks said, and what you said.

I understand it to mean that you want the war effort or defense to get all they need first.

Secretary MCKAY. Yes, sir.

The CHAIRMAN. And whatever is left over you will not ration among the civilian users unless the absence of rationing will create a severe hardship upon the economy.

Secretary McKAY. That is correct, sir.

Senator LEHMAN. I want to point out that Secretary McKay said the following, on page 3:

My view that the defense-supporting programs for which I have responsibility will require use of materials controls-is based, of course, on these assumptions: (1) the present size and pace of the mobilization-readiness program will not change significantly: (2) the prevailing economic situation, in which overall supply and demand for goods and services are in substantial balance, will continue.

Now, I very much hope that these assumptions by the Secretary of the Interior will be proven to be correct, and that it will continue. But I do not know. I think there is grave danger that it will not, as grave danger as I believe our mobilization readiness program will change significantly because of conditions over which we have no control.

And, secondly, if that happens, then I certainly feel that there will be an imbalance between the supply and demand for goods and services.

Under those conditions, I think if you start to allocate a large percentage of your scarce materials for defense purposes, leaving only a very small percentage, or a relatively small percentage, for civilian use, I feel that, of course, recognizing the priorities that must be given to defense activities, unless you simultaneously allocate what is left over among the civilian producers after your defense needs are met, you are going to do a very serious injustice to a great many civilian users in this country. Under those circumstances I believe that the little fellow is always going to get the short end of the deal, and will suffer very heavily.

Therefore, I think that then there is, under emergency proclamation by the President, the need to allocate materials. That which is left over, after defense allocation, should also be allocated fairly and equitably among the civilian producers and users.

Secretary MCKAY. Senator, I did not get your question clearly the first time.

I believe that the economy today is such that we could allocate materials for direct defense, programs and that sufficient materials will be available for the certain economy, including the little fellow, without the use of allocation power. I am a free enterprise man, and do not like regimentation. For that reason, I am willing to take a

chance to see if it does not work. Now, if it does not work, and we are running into trouble here because of changes in the defense program and other circumstances, we can always go back to the use of these powers but only in the event of a real emergency.

The CHAIRMAN. In other words, you do not want to see it used. You do not believe in it, unless it is absolutely 100 percent necessary. If it is necessary, then you want the authority to do it.

Secretary MCKAY. Yes, the authority to do it, and do it fast. Senator LEHMAN. May I say this. I am going to take just one scarce commodity, and that is copper. Let us assume that under a very greatly increased mobilization effort, 50 percent or 60 percent or more of the available copper is used for defense and it probably would be leaving only a relatively small amount. Then, I believe that such manufacturers as the automobile companies would have a very great advantage over the little fellow, who also needs copper, the little fellow who makes copper pipe, or some kind of electrical appliances. I think he would be under a very great disadvantage, unless he was assured of his fair portion of supplies left over, after the defense effort. I think he would certainly be called upon to make a great sacrifice, and he very probably would be put out of business.

The CHAIRMAN. I can agree with the Senator, and I think the recommendations made by both Mr. Weeks and Mr. McKay here, in the language that they have suggested, and in the language that is in the bill at the moment, does give ample protection to the very thing you are talking about, providing, of course, the authority is used if it is needed to be used.

I have no fear that this administration is not just as much interested in the welfare of the people, as any other administration or any other group of men. That if conditions arise and make it necessary to use controls, as much as they dislike them, as a matter of being great believers in the private-enterprise system I feel they will use them. I am confident of that, and that is all we are endeavoring to do in this legislation. When they do not need to be used, we hope they will not use them; and when they are needed, we hope they will be used.

That is the position I am sure of every member of this committee, and I am certain it is the position of the administration. They do not want to use them if they are not needed. They do not want to do anything that is not necessary. But, if it is necessary, then they do want the authority to proceed, and proceed immediately. If they do not have that authority under existing legislation, I am sure they would be the first to come to Congress and ask for it.

I am confident that that is the position of the administration, and I know it is the position of this committee, and I know it is the position of Senator Lehman. We are vitally interested in the welfare of all the people, and we are going to continue to be vitally interested in the welfare of all the people, but we are not going to impose upon them unnecessary restraints and controls when they are not needed. The question arises as to how best to write the legislation to do that. We do have 2 or 3 controversial points in that respect, but I think we can resolve them and work them out. But, let me say this: I think it is good that men say, "Well, now, is that needed?" and, "Is there not a better way to do it?"

"Maybe we had better go carefully. Maybe it is not the thing to do."

I have no objections to that at all. I think it is very helpful, not only to Congress but in the administration and in business. I think it is very, very helpful.

However, there is a time that comes, of course, when you must either go home, or leave home, meaning that there is a time that comes when this committee, of course, must say yes or no. There is a time. that comes when you in the executive branch have to say, "Well, we have got to do something and do it quick.'

I think we are all interested in the same thing. I think when we get through with this legislation, that it will be rather satisfactory to everybody. At least I hope so.

Mr. Secretary, I wonder whether it would be possible for you to supply for the record a summary statement, and breakdown by size, purpose, and possibly material, your exploration and development loan program.

Also, I would like to have a more detailed explanation of how the accelerated amortization program was used in the development and expansion of mineral and metal supply, both domestically and foreign. Secretary MCKAY. I would be more than happy to supply you with that material.

(The material referred to follows:)

USE OF FINANCIAL AIDS AND INCENTIVES IN PROGRAMS OF DEFENSE AGENCIES UNDER JURISDICTION OF THE SECRETARY OF THE INTERIOR

The statements and tables which follow show, for each of the defense agencies under the jurisdiction of the Secretary of the Interior, the nature and extent of use of the financial aids and incentives available under title III of the Defense Production Act in connection with the respective programs. Although the authority to issue necessity certificates for accelerated tax amortization is derived from section 124A of the Internal Revenue Code, rather than from the Defense Production Act, the use of this form of incentive to defense-supporting industrial expansions has been so extensive that tables pertaining to it are included.

MINERALS EXPLORATION PROGRAM

Utilizing the powers and borrowing authority provided by title III of the Defense Production Act, the Defense Minerals Exploration Administration conducts a program to encourage exploration for and development of critical and strategic minerals and metals in the United States, its Territories and possessions. Under this program, the Government participates with private parties in the cost and risks of exploration projects, to the extent of 50, 75, or 90 percent of the cost of the project, depending upon the mineral or metal being sought.

If the DMEA certifies that a discovery or development has been made as a result of such a project, the operator is obligated, in the event that minerals are produced within 10 years from the date of the contract, to pay royalties to the Government out of net proceeds from sales until the total amount contributed by the Government is paid, or 10 years have elapsed, whichever occurs first. The volume and disposition of applications from private operators for contracts under this program through February 1953 are indicated below:

Status of applications for exploration assistance through February 1953 Applications approved and contracts executed..

Applications denied...

Applications withdrawn.

Applications in process.

Total number of applications received..........

462

722

310

230

1, 724

The status and value of, and the amount of Government participation in, the 462 contracts which had been executed as of February 28, 1953, are presented in the attached table A, which also shows distribution of contracts by metals and minerals being sought.

Through February 28, 1953, 26 exploration projects have resulted in certifications of discovery or development. Data concerning these projects, as well as others which have been terminated, are presented in the attached table B.