I trust the staff will get up the necessary information on what amortization laws there were in connection with these industries that might be developed.

I also want to place in the record, at the request of Senator Robertson, a letter from John S. Jenkins & Co., of Norfolk, Va. It too, will be placed in the appendix.

Mr. Attorney General, there is one question I would like to ask you. Senator CAPEHART. May I place something in the record?

The CHAIRMAN. Certainly.

Senator CAPEHART. I wish to place in the record a comparison of the Defense Production Act of 1950 with postwar Presidential requests as reflected in the Spence bill, H. R. 2756, 1949, and the Barkley bill, S. 2910, 1948. This shows the comparison between this present bill and bills that have been introduced to do similar things in peacetime. The CHAIRMAN. Without objection, it will be placed in the appendix.

Senator CAPEHART. And, Mr. Chairman, I wish to place in the record a comparison of the Defense Production Act of 1950 with World War statutes and Executive orders.

The CHAIRMAN. By whom was that prepared? I want the record to show the committee staff

Senator CAPEHART. Show that it was prepared at the instance of Senator Capehart.

The CHAIRMAN. Without objection it too will be placed in the appendix.

Mr. McGrath, I want to ask one question while you are here: There has been discussion about the use of the word "facilities" in the seizure section of the bill, title II, in which it has been stated that that word would permit the President, if necessary, to seize farms.

Of course, we all know it was not intended to do such a thing as that, and I certainly feel that way. I wonder if you in the Justice Department could think this over, and let us know sometime this afternoon or tomorrow morning if you have a substitute word that would negate any thought of such a thing, because we have no such thought.

Mr. McGRATH. Mr. Chairman, there is no provision in the bill for the operation of farms, and of course I can imagine a situation where a large dairy farm might become a facility that was needed in a particular area, to service a camp or something of that kind, but the word "facilities" is a well-recognized word in law, and I think it is quite plain what it means.

I doubt that you could find a better word to describe an over-all situation. I had heard that there was some concern in the committee about this word.

The CHAIRMAN. We thought it spelled out too much, and would give powers of too great a nature.

Mr. McGRATH. I refer to the Black's Law Dictionary definition of the word "facilities," which I think would clarify in your minds a great deal of the doubt that you may have. It defines "facilities" asThat which promotes the ease of any action, operation, transaction, or course of conduct. Webster. In a statute giving the Public Service Commission control over the service and facilities of public service companies, "facilities" means something owned by or under the control of a public utility. Borough of Swarthmore v. Public Service Commission (277 Pa. 472, 121 A. 488, 489). The term

denotes inanimate means rather than human agencies. Sloss-Sheffield Steel & Iron Co. v. Smith (185 Ala. 607, 64 So. 337, 338).

Also, a name formerly given to certain notes of some of the banks in the State of Connecticut, which were made payable in 2 years after the close of the war of 1812. Springfield Bank v. Merrick (14 Mass. 322).

Senator CAPEHART. Mr. Attorney General, I would like to discuss with you, if I may, just a few minutes, title II, "Authority to requisition."

The purpose of that title, of course, is to give the President, the Government, the right to get all the materials that they need in the war effort as quickly as they can secure them.

Now, I haven't any quarrel with giving the Government the right to requisition or take over any materials that they need, inclusively, for the war effort, meaning that if someone has ordered 10,000 tons of copper and the Government needs it for the war effort, they should have the right to go and get it, by paying the fair market price for it. I don't think anyone can quarrel with that particular feature of title II.

Now, my question is: As far as facilities are concerned, and I think that the term "facilities" in this bill means manufacturing plants and processing plants, and physical properties-it might be broad enough to include a farm, but I am certain that was not intended, though it nevertheless might well do it-wouldn't it be in the best interests of the country if that section was rewritten so that the Government could take over only facilities if it was going to use them in the war effort; meaning take it over for the exclusive use of the military, because you must admit that the title itself is so broad that the President could take over, if he wanted to, every facility in the United Sates, and my point is giving him the unlimited right to take over materials that may be needed in the war effort.

Mr. MCGRATH. It is limited in the section, Senator, to national defense needs. He can't take it for anything but national defense needs. Senator CAPEHART. Then what do we mean by "national defense"? That, to me, is broad, in the light of the declaration of policy in this bill. I might read it. I don't know that it is necessary, but let's read the close of it:

It is the intention of the Congress that the President shall use the powers conferred by this act to promote the national defense

Title II reads:

Whenever the President determines that the use of any equipment, supplies, or component parts thereof, or materials or facilities necessary for the manufacture, servicing, or operation of such equipment, supplies, or component parts, is needed for the national defense

so that he can take these matters only where they are needed as component parts of a national defense or manufacturing process.

For some reason the President, of course, does not want to declare a national emergency, and we are not going to argue the merits or demerits of that at the moment. The only way this bill will ever end, of course, is when it expires; that is when it terminates on June 30, 1952.

Now, under the War Powers Act, and all those things that you described this morning automatically terminate 6 months after the war ended, many of them.

Now, we have always had national defense, and we always will have national defense, and therefore the only way that you can terminate any of the powers in this bill is by Congress, or at the end of 2 years. My point is that at the end of 2 years you might make as good a case for this bill as you can now, and if you do, of course, it may be that it should be passed, but I am asking you, as the Attorney General of the United States, insofar as facilities are concerned here—and I think we both agree that means manufacturing facilities and processing that we be more specific, and simply state that they can only be used, and then set up some method in this particular title for returning the facilities to the original owners when the emergency is over, rather than going on forever here under the name of national defense, which will be with us forever, as it always has been with us. Now, I think if that can be done in that title, I don't think it will weaken the title any, and I think it will give the protection that the people are enitled to.

Mr. McGRATH. I am advised, Senator, that such a provision was in the 1941 act, and I see no reason

Senator CAPEHART. That was in the 1941 act; that is right.

Mr. McGRATH. I see no reason why it would weaken this bill in any way. It might be an improvement. Offhand, I think of no objection. The CHAIRMAN. I understood in the 1941 act you were talking about facilities?

Mr. McGRATH. About return of property..

Senator CAPEHART. Title III, "Expansion of productive capacity and supply." I haven't any quarrel with that title except that I would like to see added to that, if possible-and I question whether it can be done here or not, it may have to be done on the revenue bill—and that is that we return to the old 5-year amortization plan that we had in World War II, called the certificate of necessity. I think it will strengthen that title, and help get the production that we want. Now, you might tell us whether or not you think that such a provision could be added to this bill.

Mr. McGRATH. I would strongly favor such a provision, Senator, and I always have felt that way; that power ought to be vested, I would think, in the Secretary of the Treasury to make amortization agreements with industry in an expanding era of this kind.

Senator CAPEHART. We had it in World War II, these necessity certificates, and anyone who cared to use his own money to build facilities

Mr. MCGRATH. There is no question about its desirability, but I am of the opinion that it is a fiscal matter, and it ought to go in the fiscal bill and not here.

Senator CAPEHART. You think we could not add it?

Mr. McGRATH. You could add it if you wished to, but I think it fits better into the appropriation bill.

Senator ROBERTSON. You mean the tax bill?

Mr. McGRATH. The tax bill; yes.

The CHAIRMAN. Why not let this committee approve such a section and send it to the Finance Committee to be attached to the present tax bill?

Mr. McGRATH. I discussed this with the Secretary of the Treasury, and I think I can speak for him in this regard. I think he would wel

come powers of that kind. It shouldn't be spelled out in too much detail.

I think you could give discretionary power to the Secretary of the Treasury to make amortization agreements with industries, because one type of amortization might be desirable in some instances, and something quite different for another type of industry.

The CHAIRMAN. With the permission of the committee, we will do that. We will take that matter up, if it is agreeable, and then submit the recommendations in view of this price control bill and facilities expansion bill to Senator George, and ask him if he will put it on the present tax bill when we write it up.

Senator CAPEHART. Title IV: With respect to this title don't you think that all we need at the moment is to return to so-called regulation W during World War II? Why is it necessary to force every person in the United States who sells anything on two or more payments to secure a Federal license to do so?

Mr. McGRATH. I don't think I am competent to pass on that, Senator. It is not a legal problem, and I think you should get advice from the Secretary of Commerce, and probably the Secretary of the Treasury who is charged with credit controls, and from Federal Reserve.

Senator CAPEHART. All right; I appreciate that you are the Attorney General and not the Secretary of Commerce.

Take section 508: Does the last sentence on page 26, beginning with line 2 and ending with 8; does that in any way conflict with section 2 of the Clayton Act, and the Robinson-Patman Act?

Mr. McGRATH. Page 26, line 2

Senator CAPEHART (reading):

No person shall discriminate against orders or contracts to which priority is assigned or for which materials or facilities are allocated under title II— that is a misprint; it should be title I—

of this act or under any rule, regulation, or order issued thereunder, by charging higher prices or by imposing different terms and conditions for such orders or contracts than for other generally comparable orders or contracts, or in any other manner.

Mr. McGRATH. Mr. Stedman is with me this morning, from the Antitrust Division, and would be familiar with any conflict. I see none, myself, and he advises me that he sees none.

Senator CAPEHART. You don't see any conflict there with the Clayton Act, or the Robinson-Patman Act?

Mr. STEDMAN. Senator Capehart, we have not analyzed this particular provision in detail in relationship to the antiprice discrimination laws. In general, what it attempts to do is to set forth a requirement that you follow the usual procedures with respect to these particular orders the same as you would if these orders were not involved, and it imposes a further injunction which supports and complements the Robinson-Patman and the Clayton Act provisions rather than being

in conflict with them.

Now, as I say, it has not been analyzed in detail from that standpoint. Senator CAPEHART. Would you analyze it carefully when you get back?

Mr. STEDMAN. I would be glad to, and we will give you a letter on it.

Senator CAPEHART. Because I would say this: that it might be well to amend this section at the second sentence there and substitute therefor the following.

Nothing contained in this act or any other Federal act shall be construed to authorize the establishment by any office or agency of the Government of maximum prices for any materials; Provided, That the term "prices for any materials" shall not be construed to include rents for housing accommodations.

Will you check the wording that I have just given you, and see whether or not it would strengthen the antitrust laws, and the Robinson-Patman Act?

Mr. STEDMAN. I would be very glad to.

Mr. McGRATH. It is recognized there will have to be some relaxation of the antitrust laws if the Government is going to allocate materials and orders, but I think that the act as drawn pretty amply protects those laws.

No act can be done except with the knowledge and approval of the Attorney General, and then only by request of the President 'himself, or by one person to whom he may delegate that authority.

Senator CAPEHART. Isn't the weakness of the act, and the weakness of doing that, that it leaves it entirely up to the discretion of the President of the United States; that he may relax it for one group, and fail to relax it for another group; and is there any way that that can be avoided?

Mr. McGRATH. That is pretty hard, because you don't know where your allocations will have to go. There must be a finding, of course, that it is necessary in the national defense to have a relaxation.

Senator CAPEHART. And there, again, we are up against this problem of that particular feature remaining in the bill as long as there is a bill, with no yardstick as to when the emergency is over, or when the war is over.

Mr. MCGRATH. Well, we had no difficulty with it during the Second World War, and the provisions were much the same as they are here. The provision is set forth here that as soon as the necessity for the allocation is past they revert to their status under the acts, so I don't anticipate much trouble; but we will prepare a memorandum for you on that whole subject.

Senator CAPEHART. This bill does not terminate until June 30, 1950, or until such earlier time as the Congress by concurrent resolution of the President may designate.

In that respect, I would like to ask you this question: Would your have any objection, Mr. Attorney General, if the section 502 was amended to say that it covered specific chapters, reading that the Congress could terminate any specific portion or chapter of this bilf without having to terminate the entire bill?

Mr. FORD. Congress would have the authority to do that, anyway? Senator CAPEHART. They could do it by an act, but not by concurrent resolution; could they?

Mr. FORD. I think the bill is an integral part. I don't think you can pick out one section and pick out another.

Senator CAPEHART. Congress, if they wanted to, could so write the bill; could they not?

Mr. FORD. Čertainly they could.