we were making by the hundreds and thousands, but of a different size, and of somewhat different specifications and requirements. One of the members yesterday asked a question right along that line; and I will say that if, in the next war, the Cadillac Co., of which I was later president-I was not at that time; I was general manager of the Cadillac Co. when we entered the war-if a factory like that were called upon to make busses to carry 35 or 40 people, we would have to make an entirely new layout of our factory. There would be what we would call a great deal of paper work, work that can be done only after you know what you are going to do; and if our factory or any one of our factories were selected to make some war materials under this method of educational orders we could save a good deal of time by having made out on paper, if you please, the layout of the factory for the making of the new larger or different parts. Even though it were an automobile, it would require a great deal of time to plan how you would best use your facilities. I think I am safe in saying that if this bill should become a law, and the War Department should ask us to take educational orders, there is hardly a corporation in the entire Automobile Chamber of Commerce but that would say to the War Department, "Please make your order as small as will give us the experience to enable us to be most efficient during the war. As an evidence of the matter of profits, which was mentioned, I might cite the fact that when the war ended the Buick Co. requested the War Department-the department which was asking for aviation motors-to cancel the balance of their order, and they struck a balance, and did not make a single motor after that day. It was not a profitable thing in the sense that many have thought it was. So much has been said that I do not believe that I ought to take your time to repeat any of it; but I shall be glad to answer any questions. The CHAIRMAN. If you want to file any statement, you may file it with the reporter. If there is nothing further, thank you very much. I find that Mr. Glover and Mr. Sewall had to leave. We will hear Mr. Gall now. Mr. GALL. Mr. Chairman, I am here in the city, and I shall be glad to defer to Mr. Curtis or some one from out of the city, if you please. The CHAIRMAN. Mr. Curtis is the last one. If you will make your statement very brief, we will hear Mr. Curtis, and then we will conclude the hearing. STATEMENT OF JOHN C. GALL, ON BEHALF OF THE NATIONAL ASSOCIATION OF MANUFACTURERS Mr. GALL. I represent the National Association of Manufacturers. Mr. Chairman, I hesitate to make even a brief statement after the very complete presentations that have been made. I will confine myself mostly to putting into the record a few documents which I have here, with just one or two comments. The CHAIRMAN. Very well. 31115-29-6 Mr. GALL. The National Association of Manufacturers have been very much interested in this proposal. In 1926 we had a meeting in New York on industrial preparedness. That was attended very widely by the manufacturers, and was presided over by Gen. Guy Tripp, whom you, perhaps, recall as the chairman of the board of the Westinghouse Co. Judge Gary was also present. I mention that because both of those gentlemen have now left the ranks of industry, as you know; and it emphasizes, I think, a point which was made yesterday-that so many of these people who got wide information and education, as it were, in the past war, will not be available in case of future emergencies. We formed a committee on industrial preparedness at that meeting; and that committee, of which General Tripp was the chairman, in due course presented a report which was adopted by the National Association of Manufacturers. I wish to submit that report for the record, Mr. Chairman. It is very brief; and I call attention particularly to the fifteenth finding of fact and to the third recommendation in that report. The third recommendation is an endorsement of such a proposal as you have before your committee. (The report referred to is as follows:) PRELIMINARY REFORT OF THE NATIONAL ASSOCIATION OF MANUFACTURERS COMMITTEE ON INDUSTRIAL PREPAREDNESS FINDINGS 1. Continued prosperity in America is dependent upon assurance of enduring peace. 2. America's most recent experience indicates that the surest guaranty of peace is a readiness to defend the national sovereignty, i. e., preparedness. 3. The foreign policy of America involves no dreams of conquest nor any aggressive action toward any foreign power whatsoever, and, therefore, preparedness in America connotes only defensive measures. 4. America maintains, in proportion to national wealth guarded, the smallest standing army of any of the 50 principal countries of the world. In proportion to population whose peace and prosperity are at stake America likewise maintains the smallest Regular Army, even smaller than that allowed Germany by the treaty of Versailles, which was specifically intended to render her impotent as a military power. 5. Preparedness, on an efficient and economical basis, requires years for complete achievement and unremitting attention for its proper maintenance. Hastily improvised preparedness is needlessly wasteful of human life and unnecessarily expensive. 6. Unpreparedness has failed dismally in ever keeping America out of war. Proper preparedness, however, according to the best military opinion, might conceivably have precluded the necessity for American participation in the World War, and, in any event, would have shortened the duration of the conflict which cost a million dollars an hour for over two years. 7. Prior to the World War, preparedness was taken to mean only plans for the mobilization of man power, failing to take into consideration the fact that mobilized man power unless adequately supported by munition power was entirely ineffective. 8. The great demonstrated lesson of the World War was the fact that America, relying solely on her own resources, could organize and train troops at a rate which far exceeded the capacity of the country to arm and equip them; further, that the rate of manufacture of noncommercial articles of ordnance was the controlling factor of the entire war program. 9. Practically all the knowledge needed to organize and employ an expanded army is automatically maintained by the peace-time activities of the country with the all-important exceptions that— (a) Knowledge of the use of arms, and (b) Knowledge of the manufacture of arms must be stimulated in times of peace in order to be available adequately and promptly in event of emergency. 10. It is contrary to the traditional policy of America to maintain an extensive civilian industry devoted primarily to the manufacture of ordnance, and it is improbable that America will ever look with favor on measures intended to encourage the growth of a civilian industry dependent upon the manufacture of war material for its profits and existence. 11. Under existing conditions, the Ordnance Department of the Army, for example, while possibly adequate for such development work and such production in restricted quantities as may be necessary during peace times, is deficient in commissioned personnel when considered as the nucleus of knowledge around which must be built the tremendous industrial machine which, in the event of war, requires a preponderant proportion of the entire industrial war effort. 12. Commissioned officers of the Army appear to be available to the number 1,700, devoted exclusively to mobilizing man-power or problems involved in the use of arms, whereas but 24 have to date been assigned to the far greater and more difficult task of educating industry in the manufacture of arms. 13. The present program for national defense is, therefore, out of balance to a critical degree, due to the wide disparity in the attention now being devoted to problems involving mobilization of man power, as contrasted with the attention being devoted to problems involving the mobilization of munition power-particularly in the noncommercial classes such as ordnance and aviation material. 14. Due to the wise recommendations of the Morrow Board, now being carried into effect by appropriate legislation, the problem of aviation material is proceeding toward ultimate solution, while leaving the problem of securing ordnance material as the crucial question in considering national defense to-day. 15. What America needs most at present is a greater knowledge of ordnance manufacture and all artificial obstacles to the acquirement of this knowledge by American industry should be removed forthwith and every effort made through legislative enactment to stimulate the acquirement of this vital knowledge. 16. In this connection attention is invited to the fact that in order to build up the American aircraft industry for the purposes of national defense, the Morrow Board states, on page 29 of their report, as follows: "We recommend that: * * * "(4) Government competition with the civil industry in production activity be eliminated except in those projects impractical of realization by the civil industry. * * This wise recommendation has been adopted as the permanent policy of the War Department. It will obviously tend to spread to the commercial world a knowledge on the design and manufacture of airplane material and render the solution of the aircraft problem immeasurably easier. The same reasoning should apply to the ordnance problem. 17. The present plans of the War Department for mobilizing industry for the production of ordnance in the event of emergency are excellent in every particular, and if carried through to conclusion in all particulars will not only shorten the duration, and therefore the cost of a possible future conflict, but by strengthening our defences, will actually make the possibility of America being involved in war more and more remote in direct ratio with their degree of completeness. 18. Of the elements of industrial mobilization, the determination of requirements, both as to quantities and dates wanted, and the preliminary allocation of requirements to existing facilities, have been completed in a most effective manner. The actual completion of emergency production plans by ordnance reserve plants with the degree of accuracy and detail necessary to permit them to be used as the basis of determining probable schedule of output, as well as secondary requirements for buildings, equipment, raw material, etc., is a task of consilerable magnitude for each factory involved. 19. Existing obstacles to the completion of emergency production plans are due largely to the scarcity of trained ordnance officers available for assignment to specific plants, to supply necessary technical data and otherwise assist manufacturers in this exacting work which is expected to be done without direct remuneration from the Government. 20. The ordnance problem is the crux of national defense to-day, inasmuch as our citizens can be called to the colors ever so smoothly, can be housed and clothed and fed ever so completely, can be paid ever so generously, and furnished with all the care that surgical, medical, and dental science can afford, and yet will not become soldiers until they are furnished with the tools of their trade, viz, ordnance. 21. Ordnance is, of course, but one of several essentials of a modern army, but all the others are present in adequate supply or can be obtained in much less time than that required for the production of ordnance which, therefore, becomes the controlling factor of the entire program for national defense. RECOMMENDATIONS In order to provide a greater reservoir of knowledge for the solution of problems involved in the mobilization of munition power, particularly the noncommercial phases thereof such as the manufacture of ordnance, the committee on industrial preparedness of the National Association of Manufacturers recommends: (1) That the National Association of Manufacturers indorse the organization of the proposed "munitions battalion" as described by the Hon. Hanford McNider, the Assistant Secretary of War, at the annual meeting of the association held in New York City on October 7, 1926; that the necessary appropriation of Federal funds for the purpose of training annually 400 college students, who have satisfactorily completed at least three years of their courses, in the elements of military science and tactics, and in addition in the basic procurement problems of the Army, be urged upon the Congress now in session; and that, due to the need for immediate action in the premises, Hon. Frank A. Scott, during the war chairman of the War Industries Board. be requested, subject to the approval by your board of directors, to present to the President of the United States the recommendations of the association in this connection. (2) That the Ordnance Department of the United States Army be progressively increased over a period of years, in order to provide personnel of a proper degree of permanency equipped with the vitally important knowledge of the design and manufacture of ordnance,' necessary to permit present plans for industrial preparedness to be carried to a successful conclusion. (3) That the provisions of section 5a of the national defense act approved June 3, 1916, as amended by the act of June 4, 1920, to the effect that He (the Assistant Secretary of War) shall cause to be manufactured or produced at the Government arsenals or Government-owned factories of the United States, all such supplies or articles needed by the War Department as said arsenals or Government-owned factories are capable of manufacturing or producing upon an economical basis," be rescinded and that legislation be secured permitting the placing of educational orders" with commercial manufacturers for the production of noncommercial articles of ordnance with due consideration for knowledge of the art acquired rather than as at present, upon a competitive basis as to price. 66 GUY E. TRIPP, Chairman. Mr. GALL. We had hoped to get our committee together, Mr. Chairman, and have them here at this meeting, but Col. James L. Walsh, who is on the committee, was prevented at the last moment from coming. You, perhaps, remember him as the chief of the New York ordnance district. Colonel Walsh wired me a statement yesterday, which I will put into the record without reading, but which states the position both of the committee on industrial preparedness of the association and of the association itself on this bill, which we thoroughly indorse. (The statement referred to is as follows:) STATEMENT BY COL. JAMES L. WALSH ON BEHALF OF THE COMMITTEE ON INDUSTRIAL PREPAREDNESS OF THE NATIONAL ASSOCIATION OF MANUFACTURERS According to President Coolidge's Armistice Day speech, the ultimate cost of the World War to our taxpayers will be $100,000,000,000, or nearly one-half the total national wealth of the United States on the day we entered the war on the side of the Allies. This means that we were incurring indebtedness at the rate of $171,000,000 per day, day in and day out, for over a year and a half. This colossal waste of our capital could probably have been avoided to a considerable extent by proper preparedness, particularly in the mobilization of industry. Where we fell down was in providing the vast quantities of munitions required in modern warfare, particularly the noncommercial articles, such as ordnance and aviation material. The Nation knows perfectly well how to house men called to the colors, to feed them, to clothe them, to transport them, to provide the quickest and most accurate means of communication by telephone, telegraph, or radio; to surround them with the best of medical, dental, and surgical care, because these war-time functions have parallel peace-time activities which serve to keep alive the necessary knowledge which must be immediately available in the event of emergency. Due to the epoch-making flight of Lindbergh and his like, the question of providing airplanes for an expanded army is well on its way toward solution. More students are enrolled in the aeronautical engineering course in Massachusetts Institute of Technology than in any other engineering course. With all these problems reasonably well in hand, there is still a fatally weak link in our whole chain of national defense, because the Nation does not know how to arm its manhood. Under the present restrictive clauses of the national defense act, civilian manufacturers are in effect prohibited from acquiring practical production experience in the manufacture of essential noncommerc al articles of ordnance which they would be required to manufacture in tremendous quantities in the event of war. Hon. John M. Morin will remember that during the World War Congress provided for all Army purposes cash appropriations of $24,000,000,000 and contract authorizations of approximately $9,000,000,000. Nearly half of this tremendous total was for ordnance purposes. On a dollars-and-cents basis the ordnance problem was therefore about three and one-half times as large as the whole Navy job. The object of H. R. 450 is to permit civilian industry to educate itself without profit to itself for its huge war-time job, and thus save the unnecessary delays in getting into production which character zed our latest improvised attempt to hook up the industrial war machine. According to President Coolidge's own figures, we can save future taxpayers $1,000,000,000 for every six days by which we can shorten by proper preparedness the duration of any similar conflict of the future. American industry, as represented by the National Association of Manufacturers, respectfully urges that it be given its rightly chance to prepare for its war-time duties. Mr. GALL. Lastly, I will put into the record the complete personnel of our committee on industrial preparedness, of which Mr. B. L. Winchell, of the Remington-Rand Corporation, is the chairman. (The matter referred to is as follows:) COMMITTEE ON INDUSTRIAL PREPAREDNESS, NATIONAL ASSOCIATION OF MANUFAC TURERS Chairman, B. L. Winchell, Remington-Rand Co., New York City. Col. James L. Walsh, Detroit Guardian Bank, Detroit, Mich. John J. Carty, American Telephone & Telegraph Co., New York City. W. F. Dixon, Singer Manufacturing Co., Elizabethport, N. J. John C. Jones, Cochrane Corporation, Philadelphia, Pa. Robert P. Lamont, American Steel Foundries, Chicago, Ill. R. K. LeBlond, R. K. LeBlond Machine Tool Works, Cincinnati, Ohio. J. W. Lieb, New York Edison Co., New York City. A. L. Salt, Graybar Electric Co., of the Western Electric Co., New York City. F. A. Scott, Warner & Swasey Co., Cleveland, Ohio. H. D. Williams, Ptitsburgh Steel Co., Pittsburgh, Pa. A. H. Woodin, American Car & Foundry Co., New York City. Mr. GALL. I should like also to insert in the record, if I may, a few brief extracts which I made from the Kernan report, which was |