ponents of automotive vehicles manufactured in the United States today come from such smaller manufacturers who in fact deserve, and in informed circles are accorded, the lion's share of the credit for the over-all advancement of engineering in the automotive field. Military authorities have conceded that most of the inventive contributions that made possible the winning of World War II came from the smaller people of industry.

All of our so-called big industries are supported by a vast understructure of thousands of smaller manufacturers and producers extending, step by step, to all our basic industries. Each of these smaller units of production is stimulated to hard-to-win advancements in its techniques, and in improvements in its products, by a hope of financial reward for service rendered. In this vital area from which most of the productive strength of our Nation comes, the producer asks only for a fair opportunity to outinvent and outperform his competition. He does not carry a mendicant's tin cup, or a bottomless barrel. He pays heavy taxes. He asks no hand-outs from Government. As a modest example, my own research, development, and manufacturing corporation, although supplying critical military products to Government, without once failing to meet a creative, an engineering, or a production requiring of Government, has never accepted from Government any money for research or developmental purposes.

But the smaller manufacturer does ask that Government refrain from subjecting his operations to interferences by tax-supported planners volunteering from the field of professedly prodigious intellects comfortably preoccupied with observations of the labors of others, including the Almighty, and with stimulating speculation as to how everything might be better done. Such intellects, you may have noted, court little criticism from those who have learned, as must be learned, the hard way, what it takes to get things done.

When the planner moves in, with grants of power by Government to interfere with the normal exercise of the essential functions of competitive industry, two unalterably opposed concepts collide. Neither can team successfully with the other. Resultant industrial stagnation must eventually dry up about everything of value in our economy-even the source of the tax money which supports the planners.

I know how men of smaller industry must appreciate the solicitous attitude on the part of the Committee on Labor and Public Welfare reflected in its report on Senate bill 247, in the following paragraph:

Spokesmen for industry have revealed that more than 150,000 industrial establishments have no basic research facilities whatever, and that those establishments are pursuing goals which are peculiar to their own interest, without proper coordination with the general basic research problems of the Nation. [The emphasis is supplied.]

The bill mentions the word "correlation" but does not contain the word "coordination." The testimony indicates an understanding that these two words may be used interchangeably. Any difference in the meaning of the two words is much narrower than differences frequently bridged in justifying administrative policies of governmental agen

cies.

Within those 150,000 industrial establishments perhaps are to be found most of the significant achievements in applied research. And

out of industry as a whole, if facilities of universities and other research institutions employed from time to time by industry on special assignments are included, no doubt has come much advancement in basic research unless such research is presumed to include only the most profound explorations in the realm of the sciences. In testimony relating to Science Foundation legislation it has been stated, however, that it is difficult to draw the line between basic and applied research.

As to industrial establishments pursuing goals which are peculiar to their own interest, is that not the type of pursuit through which our advancements come? And is it possible, or desirable, to attempt, through a single governmental agency, "correlation"-which implies control-"with the general basic research problems of the Nation"?

Would it not be equally practicable to undertake to correlate all industrial functions and activities, which would mean the complete elimination of competitive factors and the complete domination, or absorption, of industry by government? Would not the proposed correlation of industrial research lead inevitably to such absorption by government, not only of research but of industry itself? And, again most seriously, may we not ask whether that is, in fact, the submerged purpose of these bills?

In a recent conversation with a representative of one of our largest industries, on the subject of this Science Foundation legislation, it was stated by that representative to be his belief that within about 6 months after the enactment of such Science Foundation legislation there would arise within industry a tremendous uproar of protest and a futile hope for relief from the consequences of such departure from sound American traditions. Perhaps because of limitations imposed by responsibilities to interests exposed to governmental mechanizations, the gentleman expressed total inability to raise his voice in these hearings. Most men of industry have been found to have heard only vaguely about the National Science Foundation bills and to have been spared any considerable understanding of their serious import. As an example of the obviously studied unfrankness of H. R. 12 may we examine whether the bill in fact provides for authority to confiscate patents, research facilities, and plants? Under the heading "Authority of Foundation" section 11, we find:

** **

The Foundation is empowered to do all things necessary to carry out the provisions of this act, and without being limited thereby, the Foundation is specifically authorized (e) to acquire by purchase, lease, loan or gift, and to hold and dispose of by sale, lease, or loan, real and personal property of all kinds necessary for, or resulting from, scientific research.

Of course, including patents.

May we at this point submit for the consideration of the committee an opinion rendered to National Patent Council, by Richard S. Melvin, legal adviser to the Council, which opinion reads in part as follows:

It is necessary, before any agency of the United States Government exercises the right of eminent domain and condemnation proceedings, that it have authority in some act of Congress, giving it that power. This power does not need to be set out definitely and specifically, but, as has been held, legislation authorizing the acquisition by the Government of lands for public use will, where such construction is possible, be construed as authorizing the Government to acquire such lands by the exercise of the power of eminent domain. (Albert Hansen Lumber Company v. U. S. (261 U. S. 581, 67 L. ed. 809, 43 S. Ct. 444.) Since H. R. 12 at section 11 (e) grants the National Science Foundation the right to

acquire property, the doctrine of the Hansen case would be applicable even though the language is "acquire by purchase, lease, loan, or gift," and the National Science Foundation would have the power of eminent domain.

This supports the contention that, under the provisions of H. R. 12, if enacted, the director of the Foundation could arbitrarily acquire, by condemnation, real estate, buildings, facilities, patents, patent rights, drawings, and other property relating to research, with the question of compensation entirely beyond control of the owner of the property condemned.

It is not understood that many of the proponents of the bill have given it, publicly, any such interpretation. However, it may be noted on page 62 of the record of the hearings on H. R. 6007, dated June 1, 1948, that George E. Folk, an eminent lawyer, testified in part as follows as to that bill, identical in text to H. R. 12:

Therefore the Foundation would be authorized to acquire, in any manner whatsoever, patents necessary for scientific research or development or resulting from scientific research or development. Surely no such unlimited power of condemnation of patents was intended to be placed in the Foundation.

Perhaps as a covering afterthought, there is appended to section 12 (a) under the title "Patent Rights" the following:

Provided, however, That nothing in this act shall be construed to authorize the Foundation, by any contractual or other arrangement, to alter or modify any provision of law affecting the issuance or use of patents.

This provision has been perhaps as fully effective as could have been intended. Some men high in the profession of patent law have referred to this provision, erroneously, as giving them every desirable assurance that the patent system, as it functions in our economy, would not be disturbed by anything contained in H. R. 12. It seems there could be no more impressive proof of the high responsibility carried by the honorable members of this important committee for study of the submerged potentials of this bill for seriously disruptive economic reper

cussions.

With another and superpowered governmental agency engaged in the pooling of patent rights of import to industry, added to the long roster of such already established agencies, what must industry think, and feel, as to its chance to retain any autonomy related to research and invention? Astounding practices in the manipulation of such agencies' cartels of patents are reported, with conclusive documentation, under the heading "Sauce for the gander-what for the goose?" beginning on page 13 of the exhibited transcript of my address of March 11 to Dayton Patent Law Association.

And I would like respectfully to suggest to the members of the committee that, if nothing else, they read that very significant documentation which shows the treatment, definitely, in their own words, on their own letterheads, that other agencies of Government, including the military, are giving to the pooling of patents and the exercise of the powers of those pools in their dealings with industry. I think you will find it a rather shocking revelation.

That is beginning on page 13 of the exhibited transcript of my address of March 11 to the Dayton Patent Law Association, if you would care to refer to it.

And might inquiry be made as to whether it is regarded as within the authority and duty of your committee to examine the extent to

which H. R. 12 and related bills would subvert the intent of the Constitution of the United States? Attention of your committee is directed to sections (5) and (6) of National Patent Council's communication to the Department of Commerce, Office of Technical Services, under date of October 9, 1947, beginning on page 17 of the transcript of the exhibited Dayton address. Those sections read as follows:

(5) A patent grants only a negative right. That right is to exclude others, for the limited period of 17 years, from manufacture, sale, and/or use of the invention-at the will of the patent owner, and to any extent he may desire.

"(6) When our Government, which is presumed to be the entire citizenry, acquires a patent, that patent by every constitutional intent automatically expires, because there is none left to exclude. To hold differently is to hold that our Government has become a competitive device imposed upon the citizen and deriving its power arbitrarily from a source apart from any formalized expression of the will of its people. The Government, which has granted the patent, in presuming to own it, places itself in the untenable position of having vested in itself, without authority, a right which clearly, by constitutional intent, can be possessed only by the citizen.

While the attention of your committee is directed particularly to the above-quoted sections, it is suggested that you read that portion of the transcript beginning on its page 16 under the heading "Power planners scorn Constitution."

The above-quoted challenge of the constitutionality of ownership of United States patents by the United States Government has not been questioned by any authority. It has been supported unequivocally by eminent lawyers including, according to advice of the Office of Technical Services, lawyers of Government to whom the question was referred.

There perhaps has been no more flagrant flaunting of the Constitution by agencies of Government itself than the persistance of such agencies in acquiring, pooling, and manipulating patents and patent rights. That Government which decries cross-licensing, agreements to assign improvement patents, exchanges of know-how under patent licenses and selective and restrictive licenses, proceeds, as above documented, to do all these things which it would forbid the citizens to do. The distinction is that the citizen in doing them is well within constitutional intent and the framework of our laws. Government, in doing these things, and in its every act of pretended ownership of a patent, operates in scornful contravention of the clear intent of the Constitution.

Could not this committee as such decline to report out H. R. 12, or any similar bill with such provisions relating to patents, on the ground of clear unconstitutionality-and then could not the members of the committee cause to be drafted, and introduced under their sponsorship, a bill having the effect of restoring to the public its constitutional right to enjoy, fully and unconditionally, all patent rights once acquired by Government?

By what concept of consistency does H. R. 12 provide that no provision thereof shall disturb our patent laws and at the same time provide for Government ownership of patents in contravention of the clear intent of our Constitution?

During the past 15 years we have seen our patent system, and the incentive provided thereby seriously weakened by extraneous applications of subversive doctrines, without any substantial changes in the patent laws themselves. The ideologies that induced such sabotage of

our patent system are now rather well understood, as to their objecties and as to their source.

In this Science Foundation bill, H. R. 12, and related bills under consideration by this committee, there would be exerted upon our patent system a subversive extraneous influence perhaps more sinister than any as yet imposed upon it by agencies of Government. While other agencies of Government are attempting to exercise, presumptuously, similar powers with relation to the absorption of patents by them, it is obvious that the proposed foundation, with its over-all penetrations of industry and with its tenacles formed through unlimited numbers of scholarships presumably feeding patent pools of Government, would establish much more comprehensive, and steadily intensifying, pressures toward diminishing inventive and productive activities throughout private industry.

In my statement filed with the Senate Patents Committee under date of October 23, 1942, here offered as an exhibit, there appears the following paragraphs:

(This exhibit is on file with the committee.)

In times of confusion talented talkers have seemed able always to find exciting words and enticing theories with which to disable the patient builders of a nation and perhaps innocently to destroy that nation itself-more spectacularly perhaps than those talkers could find for themselves the tedious ways in which to help their neighbors build.

If we permit ourselves to be talked into disabling our patent system and thus dishearten the most vital volunteer force ever to serve America-that inventive force without which America could never have grown strong-I think we may some day ask the Japanese to yield to us for all time their standing as the world's leading exponents of hara-kiri.

Should we not instead religiously maintain adequate incentives in our patent system and devote our thought and energies to improving and supporting that system to make it even more productive of inspiration for inventors and of resultant benefits to all our people?

Then let's keep intact also the inducements which for so long have inspired men of management who, under our free-enterprise system, have performed so well in directing men, money, and machines toward serving our public with the fruits of invention.

Make those men manage fairly, but keep them inspired and free to carry us ahead in world competition, in peace or in war.

If we must have a National Science Foundation, which is doubted seriously, why not limit its authority and its operations, to the correlation of research activities of other governmental agencies? Why not first test its ability to correlate research activities of the Army, the Navy, and the Air Forces, not to mention the Marines, remembering that correlation, to be effective, requires absolute control. Without such control attempts at correlation must serve only to create confusion.

It would be interesting to observe the reactions of the hard-bitten "brass" of our respective Military Establishments to attempt to fasten upon them such controls, operated perhaps by astronomers, psychologists, and other academic specialists.

It perhaps should be noted that the Military Establishments conducting basic research include the Office of Naval Research, said by the Steelman report to the President, dated September 27, 1947, page 56, to be "supporting about 600 basic research projects in more than 150 colleges, universities, and other nonprofit institutions," at a total cost approximating $21,713,678, covering the fiscal year 1947.