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MOBILIZATION AND DEMOBILIZATION PROBLEMS

THURSDAY, AUGUST 3, 1944

UNITED STATES SENATE,

COMMITTEE ON MILITARY AFFAIRS,

Washington, D. C.

EXECUTIVE SESSION

The committee met, pursuant to call, at 10 a. m., in the committee room of the Committee on Military Affairs, United States Capitol, Senator Robert R. Reynolds (chairman) presiding.

Present Senators Reynolds (chairman), Johnson, Hill, Kilgore, Murray, Austin, Gurney, and Revercomb; also Senator Taft.

Also present: Members of the staffs of the committee and the Kilgore and Murray subcommittees.

The CHAIRMAN. Gentlemen, we have the honor and pleasure to have with us this morning our distinguished colleague, the Senator from Ohio, Senator Taft.

STATEMENT OF SENATOR ROBERT A. TAFT, OF OHIO

Senator TAFT. Senator, I came down here on the surplus property bill, which the Small Business Committee was working. Senator Stewart is chairman of the subcommittee. Unfortunately, he will not be here until tomorrow. The bill will be in shape by Monday certainly. It covers only the question of disposition of surplus property. It has been quite carefully worked out. In your consideration of the other bills-I think you have about four-this one should receive careful consideration because I think it is worked out very well. I think it defers from the others, I am not quite certain. There is a preliminary report of the subcommittee which contains a draft of the bill, but there are a number of revisions that should be made which we have discussed. I would rather not present the bill in quite its present form, but it will be ready certainly by Monday. The CHAIRMAN. All right, Senator.

Senator MURRAY. The surplus property bill which the Senator has mentioned has been given very considerable study, but it requires some further work, and I think we will have it ready by Monday. I think the surplus-property matter should not be taken up until that time, to give us an opportunity to have that bill here.

Senator KILGORE. May I ask a question, Senator? The thing came to my attention, and I wonder if you have given it consideration. The cities were highly discriminated against in that they could only purchase property at a 25-percent discount on its initial cost, which in most cases was rather excessive for normal prices, whereas a speculator could get it at 20 or 25 percent of its initial cost and then sell it back to the cities at a handsome profit.

Senator TAFT. This is the provision of that bill:

The Administrator may prescribe regulations providing for the disposition of surplus property to State, municipalities, political subdivisions, and tax-supported institutions as follows: Surplus property as provided by the Government for classrooms

etc

any surplus property may be sold or leased to State, municipalities, political subdivisions, at 50 percent of the sale or lease value thereof, as the case may be.

There was some criticism or discussion of that, as to whether it should not be broadened in some manner. It may be disposed of at 50 percent of whatever the appraised value is.

Senator KILGORE. The point I make is, unless that is the lowest, if it does not sell at that price, then a speculator can buy it at a much cheaper price.

Senator TAFT. I assume you can make your appraisal pretty well down and then it would be 50 percent of that. I thought it ought to be extended to a certain extent to charitable hospitals and private institutions that were established strictly for charitable purposes. Those were some of the matters that we were hoping to amend by the next time. No doubt you have been deceived by letters from all kinds of people, particularly schools, wanting a great deal of the equipment, and so forth, which I think may be perfectly all right in the case of public-supported institutions, and others might have a preference, or something of that kind.

The CHAIRMAN. Senator Kilgore, I understand you have a witness here this morning.

Senator KILGORE. Not until the Murray subcommittee reports. I just asked Mr. Latimer to come in.

The CHAIRMAN. I thought you had a witness here now.

Senator KILGORE. No; I am waiting for the Murray subcommittee report.

The CHAIRMAN. We have a quorum here, gentlemen. I think we might as well begin.

Senator JOHNSON. Begin with what, Mr. Chairman?

The CHAIRMAN. The consideration of the business before us. We have this revised bill of August 3, and I will ask the reporter to insert it in the record at this point.

TEXT OF THE UNNUMBERED BILL, DATED AUGUST 3, 1944, WHICH WAS SUBSEQUENTLY SUBMITTED TO THE SENATE AS S. 2061

[SUBCOMMITTEE PRINT No. 2, AUGUST 3, 1944]

A BILL To provide a national program for war mobilization and post-war adjustment

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

TITLE I-GENERAL PROVISIONS

SEC. 101. The Congress hereby declares that the objectives of this Act are(a) to facilitate maximum war production during the war and to expedite the transition from war to peace;

(b) to achieve full employment, rising standards of living, and effective utilization of the Nation's resources during the period of transition from war to peace, and thereafter; and

(c) to provide for the development of unified plans and projects and adequate machinery to ahieve the foregoing objectives.

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