A BILL TO HELP CURB MISMANAGEMENT AND WASTE IN THE EXECUTIVE DEPARTMENT

The SPEAKER. Under previous order

of the House, the gentleman from Ohio of the House, the gentleman from Ohio [Mr. BETTS] is recognized for 15 minutes. Mr. BETTS. Mr. Speaker, a favorite subject of criticism by Members of Congress is waste, inefficiency, and mismanagement of public funds. Yet, few of these attacks include proposals for work

able solutions to reduce uneconomical and inefficient practices. Today I am introducing a bill which goes to the source of these problems and will provide improved procedures to ferret out the individuals or administrative practices underlying misuse of our tax dollars. Here are the principal objectives of this legis

lation:

First. To require publication in General Accounting Office reports of the names of Government employees personally responsible for failing to comply with the laws or administrative procedures in spending public funds after this has once been reported by the Comptroller General to the appropriate agency head. Second. To require that before 1 cent of taxpayers' money can be spent by a newly established Federal agency, the head of that agency must consult with the Comptroller General to become well acquainted with requirements for the disbursement of funds and contracting procedures.

Third. To suspend funds from all agencies whose accounting systems have not been approved by the General Accounting Office within 2 years after passage of the bill, and requiring all new agencies to meet these approved standards within 2 years after they begin operation.

Fourth. To require that every agency which receives General Accounting Office recommendations because of findings of mismanagement of funds must submit to the Bureau of the Budget a report of corrective action to prevent recurring waste.

Now let us consider the provision to require the Comptroller General to publish the names of persons responsible for improper handling of public funds.

First, it is a basic concept of American Government that all activities of public employees should be open to inspection, excepting only those of a purely personal nature or involving the national security. Accordingly, persons charged with the authority to disburse public funds should be publicly held accountable for their actions. To hide by anonymity or pass the buck through the "chain of command" is a great disservice to the American people. It is with this in mind that I submit the Comptroller General should publish the names of persons whose fiscal or legal decisions have cost the taxpayers unnecessarily through inefficient operations.

I believe in rewarding those in Federal service whose suggestions and good judgment merit recognition. Through the Government Employees' Incentive Awards program, 67,731 awards, averaging $36, were given for superior job performance in 1964. More than 118,800

suggestions were adopted with awards averaging $40 presented to many thousands of officials. If such an expansive program can be conducted for promoting good work, surely it is only proper to seek to identify and obtain disciplinary action or dismissal, where justified, for those failing in judgment, training, or intent, to meet the standards of responsibility with which they are

charged.

The Comptroller General presently has the basic authority for access to records of Government agencies but does not regularly publish the names of individuals involved in deficiencies in his periodic reports. However, former Comptroller General Campbell believes it desirable to identify these decisionmaking personnel and has stated this in a letter addressed to me on March 18, 1965:

In order to achieve for the Congress and from our findings, it is our policy not only the agency involved the greatest benefits to clearly demonstrate the existence of deficiencies and their actual or potential adverse effects, but also to determine, insofar as practicable, the underlying causes. this respect, we consider it desirable to closely relate the deficiencies we find, not only with the specific practices and procedures, but also with the organizational units and individuals who are responsible for the existence or occurrence of the deficiencies since we feel that there is no substitute for a strong sense of personal responsibility in conducting the Government's affairs.

The legislation I propose requires that when the Comptroller General finds that a particular Government employee is not complying with the prescribed procedures for dispensing funds, property, or assets for which he is responsible, this information must be called to the attention of the head of his department or agency. If, in a subsequent audit, the Comptroller General finds the same individual guilty of the same or similar deficiencies and corrective or disciplinary action has not been taken against him, then the name of this individual shall be published in the General Accounting Office reports on that agency. With the names of such persons and a documented report on the deficiencies involved, appropriate committees of Congress can conduct investigations, draft new legislation, or otherwise determine what action is needed to wise determine what action is needed to rectify these situations.

This bill goes to the heart of a great many of the wasteful practices which are often repeated. I believe it is essential that every accounting system must be adequate to properly and prumust be adequate to properly and prudently dispense Federal moneys in accordance with statutory provisions and good business practices. My bill will require executive departments and agencies to bring their accounting procedures into conformity with the Budget and Accounting Procedures Act within 2 years. This 2-year limitation will also apply to This 2-year limitation will also apply to all new agencies. If a department fails all new agencies. If a department fails to comply, all expenditures of public funds must cease until the Comptroller General approves the agency's accounting system.

Mr. Speaker, when we talk about Federal spending over a period of years we are referring to astronomical figures in the hundreds of billions of dollars. We the hundreds of billions of dollars. We

should also not overlook these facts: In 1963, the Comptroller General presented evidence of potential savings of $218,380,000 and for 1964 the figure was $294,323,000. When we speak of accounting systems we are speaking of 128 such systems within the civil departments and agencies subject to General Accounting Office approval. These agencies have had more than 14 years to improve and modernize their accounting systems. Look at the results: Only 41 complete systems and parts of 15 others had been approved through May 1964. Last year the Comptroller General made the following statement regarding the delinquencies in improving their systems:

In the nearly 14 years that have gone by *** the number of executive agency accounting systems that have been modernized, improved, and brought into conformity with the requirements of law and the broad principles and standards prescribed by our office is disappointingly small.

This bill would require that all agencies receiving Government Accounting Office recommendations for improved procedures or policies submit a report to the Director of the Bureau of the Budget on whether the agency has complied with the recommendations and, if not, why. The President has pledged his administration will fight waste, so, through this bill, the Director of the Bureau of the Budget must review the progress of executive departments and agencies to eliminate recurring waste. A compilation of the reports to the Director of the Bureau of the Budget will be submitted to Congress annually for review, particularly by the Government Operations Committee and Appropriations Commit

tee.

While a basic problem in any government is the ability and judgment of personnel at every level of decisionmaking, the administrative officer should be quick to take remedial action when a Government Accounting Office recommendation is brought to his attention. Presently, except for the initiative taken by an Administrator and the encouragement in that direction contained in the Bureau of the Budget's Circular No. A-50 of April 1, 1959, little coordination or control is maintained over recurring waste.

We

The President, in his far-reaching legislative program, has proposed a number of completely new agencies, and at least one new Cabinet department. I believe the Congress has a responsibility beyond simply criticizing Government officials after waste has been discovered. should build, develop, and reinforce administrative practices to keep newly hired officials in full and accurate compliance with the statutes under which new Government establishments must operate. The heads of all new agencies are required to consult with the Comptroller General on principles, standards, and related requirements for accounting and legal disbursement of public funds in my bill. This procedure is mandatory because only by a thorough review of the contracting and expenditure systems can an accounting system function with minimum difficulty and maximum efficiency.

Abundant examples to document the need for this bill are available to my

colleagues and the American people. I simply refer you to any annual report of the Comptroller General, the Comptroller General's periodic reports to Congress, and various hearings and reports of the House and Senate Government Operations Committees.

Consideration of this measure is timely today because as the first session of the 89th Congress prepares for adjournment, such a bill can be studied by Members this fall and appropriate committees and executive agencies. When we return in January with a full session ahead, necessary analysis and reports can be completed, and, I would hope, hearings held on this and other related measures.

SERIOUS CONDITION OF PRIVATE SHIPYARDS IN THE NEW YORKNEW JERSEY AREA

The SPEAKER. Under previous order of the House, the gentleman from New Jersey [Mr. DANIELS], is recognized for 60 minutes.

Mr. DANIELS. Mr. Speaker, the New York-New Jersey port has been hard hit in recent years. In the last few years we have seen the closing of not less than four private shipyards in addition to the Brooklyn Navy Yard.

It is fairly obvious what the economic loss to our part of the Nation has been. We have suffered greatly from these closings, and in my opinion, the security of the United States has not been well served by this paralysis which has hit the largest port in the United States.

After the announcement of the closing of the Todd Shipyard in Hoboken, on the New Jersey side of the Hudson, the New York-New Jersey congressional delegation met and formed a committee to aggressively seek repair work as a substitute for some of the shipbuilding work which we would no longer receive. The very able gentleman from New York, the beloved dean of the House, the Honorable EMANUEL CELLER and I were elected cochairmen of the group.

Last spring, my colleague, Hon. JOHN M. MURPHY-representing Mr. CELLER— and I, along with a large number of representatives from labor and management, met with Secretary of the Navy, Paul H. Nitze, at his office at the Pentagon. We were given every assurance that we would be given every consideration.

Just how much consideration we have received can be gleaned by the following amount of repair work which our private yards have received since our meeting with Mr. Nitze on April 26, 1965.

From April 26 to June 23, 1965, our private yards received the magnificent total of $138,000 for repair work done on four destroyers, a minesweeper, an auxiliary ship, and subcontracted work relating to the overhaul of the aircraft carrier, U.S.S. Intrepid. Surely, this amount of work divided among five shipyards is not going to go very far toward alleviating our serious difficulties caused by the shutdown of the Brooklyn Navy Yard and the private yards in our port.

This week, insult was added to injury, when the Maritime Administration announced that our shipyards would be

passed over for repair work being done passed over for repair work being done on federally owned ships which are being taken out of the so-called mothball fleet for use by the Navy's Military Sea Transportation Service in connection with the current buildup in Vietnam.

Six ships are being reactivated from the mothball fleet which is located at Jones Point up the Hudson River.

Last week the Maritime Administration announced the reactivation of all of these ships would not be done in the New York-New Jersey facilities.

It was originally announced that only four of these ships would be refitted in four of these ships would be refitted in our local shipyards. After a storm of protest was raised over the weekend from alarmed labor leaders, spokesmen for management and officials of the Port of New York, the Maritime Administration backed down, stating that only one ship would be taken from the Port of New York. This ship, the Denison Victory, is already at the Sun Shipyard in Chester,

Pa.

Mr. Speaker, the cost for renovating each of these ships runs to about $300,000. In view of our severe unemploy000. In view of our severe unemployment situation, we cannot afford to lose even one of these ships.

Last week Capt. Thomas A. King, Director of the Atlantic coast district of the rector of the Atlantic coast district of the Maritime Administration, stated that repair work could not be done because we lack the facilities.

Mr. Speaker, if there were some substance to the statement of Captain King that we are not able to handle the repair work in question, then our cause would not be the legitimate one that it is. The fact of the matter is that we have all sorts of ship repair facilities available sorts of ship repair facilities available which are not presently being used. In my own district alone, the Bethlehem Steel Yard in Hoboken could handle all the work being done in connection with the work being done in connection with the ships being reactivated from the the ships being reactivated from the Jones Point reserve fleet. And, there are other yards in the port which are equally other yards in the port which are equally capable to perform the work in question. capable to perform the work in question.

Mr. Speaker, our workmen are highly skilled. They have learned the shipbuilding trades by means of years of experience. Their experience and skill is a vital national asset in times of intera vital national asset in times of international peril. During World War II and national peril. During World War II and the Korean conflict our skilled workmen performed shipbuilding miracles.

The Bethlehem Yard in Hoboken could employ 12,000 men if it were running at full capacity. Today this great shipyard employs only about 1,000 men. The Todd Shipyard also in Hoboken now has only about a score of men still working. Its final demise is scheduled for December.

We have the yards, we have the skilled workers. In fact, we have everything except the work. Why has the Maritime Administration chosen to follow the Navy's lead in abandoning the New YorkNew Jersey port to its fate? This, Mr. Speaker, is the question which we in the New York-New Jersey delegation demand to know.

I can only say, Mr. Speaker, that if this decision is not countermanded, the this decision is not countermanded, the conclusion is inescapable. The administration has broken faith with us. We in the New York-New Jersey delegation have gone down the line with the administration on matters which are geo

graphically remote from our part of the Nation. We have loyally supported farm programs and aid to Appalachia because we felt that these programs were good for the Nation even though they do not benefit directly the people of our area. But if we are asked to support programs to aid every part of the United States and then see a major industry in our area, which has long been in decline because of the shortsighted Navy policies, treated with contempt, then I say, Mr. Speaker, it is time that those who are responsible for making administration policy learn that charity begins at home. Mr. CAHILL. Mr. Speaker, will the gentleman yield?

Mr. DANIELS. I yield to the gentleman from New Jersey.

Mr. CAHILL. Mr. Speaker, I would like first of all to commend the gentleman for his interest in this very vital matter that is of great interest not only to the shipyards of New Jersey and New York but also to the entire country. The gentleman I know has had an abiding and continuing interest in the welfare of shipbuilding in New Jersey. I know that the gentleman has been most cooperative in the efforts I have tried to expend in bringing new work to the private shipbuilding yards in New Jersey. I would like to say to the gentleman that I share his views. I believe that the time has come when the responsible Government agencies must recognize that if the private yards in the New York-New Jersey area are to continue in being they must receive their fair share of all Government contracts, whether it be in the form of new shipbuilding awards or, as the gentleman is pointing out, in major repair work.

I think the gentleman recognizes that one of the leading private yards in the country, the New York Shipbuilding Corp., is located in my district and employs a great many men who are residents of the district represented by the very distinguished and able gentleman from New Jersey [Mr. McGRATH].

Mr. Speaker, I know that the gentleman from New Jersey [Mr. McGRATH] has in the past and is now exerting a great deal of his personal effort in a cooperative effort with me in trying to aid this shipyard.

Mr. Speaker, for the information of our colleagues I would like to point out that the enrollment, the employment rolls, in that yard which have approximated 10,000 men for the past many years, have now been depleted to approximately 3,000. This has been occasioned by the inability of the yard to obtain any new contracts for the construction of ships or to be the recipients of any awards for major repair work. Therefore, I can recognize, as well as any Member of this House, the anxiety of the Member in the well for the yards in his

area.

Mr. Speaker, I know that the men and management and labor who are dependent upon these yards for their sustenance, as well as the people of his district, should be very grateful to the gentleman for bringing this to the attention of the House.

In closing, Mr. Speaker, I would like to say to the gentleman I hope to bring

to the House within the next few days legislation which will create a study commission for the purpose of investigating as to what we can do to aid the private shipbuilding industry in this country. Once again, Mr. Speaker, I commend the gentleman and congratulate him and assure him of my continuing cooperation in his endeavors to aid the yards in the State of New Jersey.

Mr. DANIELS. I want to thank the gentleman for his contribution. Mr. RODINO. Mr. Speaker, will the Mr. Speaker, will the gentleman yield? Mr. DANIELS. I yield to the gentleman from New Jersey.

Mr. RODINO. Mr. Speaker, I want to commend the distinguished gentleman from New Jersey [Mr. DANIELS] for the initiative which he has shown in this effort. Again, the gentleman demonstrates that he not only represents the people and the best interest of his constituency, but in doing so he serves the

gentleman from New Jersey now in the well.

Mr. Speaker, since coming to the Congress I have worked with the gentleman from New Jersey [Mr. CAHILL] in connection with similar problems with reference to the New York Shipbuilding Co. at Camden as many of the workers in that yard live in the Second Congressional District which I have the honor to represent.

Mr. Speaker, I want to commend the gentleman from New Jersey [Mr. DANIELS] for his efforts on behalf of the private shipbuilding industry in New Jersey and on behalf of the Nation for his efforts in this regard and I pledge my continued assistance in behalf of his great efforts.

Mr. MURPHY of New York. Mr. Speaker, will the gentleman yield? man from New York. Mr. DANIELS. I yield to the gentle

Mr. MURPHY of New York. Mr.

The gentleman from New Jersey knows as well as I know we are losing the New York Naval Shipyard at Brooklyn. We know that facility employed at the beginning of this year almost 10,000 people. We know it is phased down to an employment level of about 6,000 at the present time. So we know there is ample skill in the port of New York to participate in this ship revitalization from the reserve fleet.

I think the Maritime Administration should compare their correspondence with the Department of the Navy. I would like to refer to some correspondence I had with the Navy as it affected the port of Philadelphia recently. I had written to the Bureau of Ships, Admiral Brockett, and knowing at one time there were about seven destroyers that were going to be put in the mothball fleet in the James River, Pa., I felt because of the

called the attention of the House of Representatives to this matter, and I want to associate myself with him and offer him every cooperation and assistance that I possibly can put forth, along with, know, the balance of the congressional delegation from New Jersey who join the gentleman in this effort.

Mr. DANIELS. I thank the gentleman.

Mr. PATTEN. Mr. Speaker, will the gentleman yield?

Mr. DANIELS. I yield to the gentleman from New Jersey.

Mr. PATTEN. Mr. Speaker, I should like to associate myself with the remarks of my colleague from New Jersey. The gentleman from Hudson County has made a very strong presentation. I am in full agreement with him that we in the New York-New Jersey area have not been getting proper consideration from the Navy Department and the Maritime Administration.

We are asked to go to bat for every other part of the United States. And let me say, Mr. Speaker, that I have no quarrel with these other sections of the United States. But once in a while, we would like a little consideration ourselves. It is nothing short of an outrage for the Maritime Administration to charge that our shipyards are not capable of doing the repair work on these ships that are being reactivated as a result of the Vietnamese crisis. There is no part of the United States where skilled labor is more readily available. As the gentleman from New Jersey just said so well, we proved what we could do in World War II and during the Korean crisis. We have serious unemployment situations in New Jersey and I cannot continue to support administration policies while the Navy Department and the Maritime Administration pursues policies which are designed to produce poverty in New Jersey.

Mr. McGRATH. Mr. Speaker, will the gentleman yield?

Mr. DANIELS. I would be pleased to yield to the gentleman from New Jersey. Mr. McGRATH. Mr. Speaker and Members of the House, I also want to associate myself with the efforts of the

man's colleagues from the State of New Jersey in paying tribute to the gentleman from New Jersey [Mr. DANIELS] for his leadership in pointing out what may be an oversight but which actually is turnthe entire New York port area is coning into a prejudicial situation insofar as

cerned.

Mr. Speaker, the gentleman from New other colleagues of mine from the State Jersey along with his colleagues and of New York have met on several occasions over the past 3 years with the Secretary of the Department of the Navy. We have met with industry leaders. We have met with the labor union leaders in an effort to try and arrive at some concerted action to insure that the port of New York ship repair and shipbuilding industry is not discriminated against. Also, most recently I received communications from the presidents of the New York-New Jersey Drydock Associations.

His latest communication pinpointing the information so far as New York and New Jersey are concerned appears in this program addressed to Capt. Thomas A. King, Director, Atlantic Construction District, Maritime Administration, U.S. Department of Commerce, 45 Broadway, New York City, and reads as follows:

Times on August 26, 1965, concerning the Your statement appearing in the New York possibility that work assigned to the port of New York by MARAD might be sent to another port because of "restricted drydock and other shipyard repair facilities in this port" has caused deep concern and protest among the members of the New York & New Jersey Drydock Association.

ship repair work in this port, partially atIn view of the already existing shortage of tributable to Government policy, we would expect every opportunity be given to existing ship repair yards located here to repair ships currently or in the future being brought from the Hudson River reserve fleet or other reserve fleets.

Allocation of ship repair work to the port of New York has long been sought and will aid the already stricken industry here as well

as help to preserve the skilled manpower

pool.

shortage of work in the New York area they might be able to divert some of the York yards bid on the mothball deYork yard. If they would let the New stroyers it might be that the New York yards could quote a figure, which would Philadelphia to New York, and still win include the towing of the ship from

some work.

Admiral Brockett stated as follows:
DEPARTMENT OF THE NAVY,
BUREAU OF SHIPS,
Washington, D.C.

Hon. JOHN M. MURPHY,
Washington, D.C.
House of Representatives,

MY DEAR MR. MURPHY: Your letter of

August 14, 1964, mentioned that seven destroyers in the Philadelphia area are scheduled to be mothballed, and requested advice yards bidding for this work and absorbing as to the possibility of New York private

the towing charges to and from New York in their bid prices.

Five destroyer-type ships (three destroyers (DD) and two escort vessels (DE)) currently are scheduled for inactivation in the Philadelphia area. The usual practice is to have the major portion of such inactivations performed by the reserve fleet group located at the appropriate berthing site, with the assistance of ships' forces. In this case the Philadelphia group, Atlantic reserve fleet, is the group assigned. Some industrial assistance will be required, on an intermittent basis, during the period of inactivation. This assistance will be obtained by contracting with a private yard or yards. Ships' forces will be supervised and assisted by personnel of the Philadelphia reserve fleet group. Much of their work will be performed concurrently with the work performed by contractor employees.

Performance of this work at a site far removed from the home station of personnel in the Philadelphia reserve fleet group would hardship. entail considerable expense and personal The foreseeable added costs of such an arrangement, including towing charges which you mentioned, would severely limit the ability of New York private yards to compete for this work. Also, award of this work to New York firms would, of course, constitute a significant drop in the very limited workload available for award to private yards in the Fourth Naval District.

In view of the foregoing, it does not appear to be practical to invite New York private yards to bid for this work.

Sincerely yours,

W. A. BROCKETT.

I hope the Maritime Administration will take that same attitude that the

Navy took when we tried to activate some ships from the Hudson River reserve fleet.

Let us not send all of these ships down at once to the port of New York and say bid on them, lest we develop another situation which developed in the past, and that is when we had an emergency situation or some emergency developed where ships had to come out of the reserve fleet. There were some repair yards that were not repair yards. They were known as bicycle shops in the industry, or marginal yards that had not been doing work over a period of time. They actually took the work away from bona fide yards that were contributing to the economic and labor prosperity of the area throughout that period.

I would also like to include for the RECORD another letter I received from the Department of the Navy which is an answer to an inquiry I made to them as to the allocation of work in the New York area.

I asked them to break down the contract awards by shipyards and give me a total figure as to just how much work had come into the New York area, particularly in this period when the New York Naval Shipyard was being phased out.

As the letter reveals, the total awards amounted to $100,789. That total is broken down among the yards and I will name just a few of the yards here.

The award to the Tickle Yard was $2,245 to work on the Parker, the destroyer.

The Todd Shipyard had a $2,527 job for work on another destroyer, the

DeLong.

The Brewer Dry Dock Co. received three shipyard awards for auxiliary ships-the Allegheny, the Fulmer, and the Harris which amounted to $4,780,

$1,600, and $2,485 respectively.

Mr. Speaker, this is chickenfeed when we come to analyze the hundreds of millions of dollars that the Navy Department spends in the repair business as well as in the construction business.

We in the 3d Naval District think that is an inflated figure so far as the ship repair and new ship construction figures are concerned in comparison with other naval districts because we have virtually all of the nuclear submarine construction taking place in New London. That is a very expensive program. So that from the construction and repair dollar that is attributed to the 3d District we can actually take and eliminate that New London and nuclear business and see that there is not much left for the port of New York that has always been a preeminent and very busy and active Navy shipyard area.

The letter I have referred to is as follows:

DEPARTMENT OF THE NAVY,

OFFICE OF THE SECRETARY, Washington, D.C., August 11, 1965. Hon. JOHN M. MURPHY, House of Representatives, Washington, D.C.

MY DEAR MR. CONGRESSMAN: Your letter of July 27, 1965 requested a breakdown of the amount of repair work awarded to the five

ance to you.

Sincerely yours,

GRAEME C. BANNERMAN,
Assistant Secretary of the Navy.

I would also like to call attention to another situation that we have that I brought to the attention of the Navy in 1963 and that was with the advent of the Savannah nuclear powered merchant ship which went on the high seas at that time as a demonstration project. When we analyzed the impact that that had and the fact that it is now going into commercial use and also the fact that we had so many nuclear submarines, I think we now have about 30 nuclear submarines in active service, I wrote to the Navy asking them to train people in the This corNew York Naval Shipyard. respondence of mine is dated in 1963 before any decision was made to close any shipyards. I asked the Navy in my letter to train personnel at the New York

Naval Shipyard so that the yard would be capable of doing nuclear powered and reconversion work and also to include private industry or invite private industry to send certain technicans to become qualified for nuclear repair work.

My communication from the Navy Department said that the Navy had adequate facilities to repair nuclear vessels and that they were not going to expand their facilities at all.

Mr. Speaker, that letter is as follows: DEPARTMENT OF THE NAVY, OFFICE OF THE SECRETARY, Washington, D.C., November 6, 1965. Hon. JOHN M. MURPHY, House of Representatives, Washington, D.C.

MY DEAR MR. CONGRESSMAN: This is in reply to your letter of October 23, 1963, in which you referred to our earlier correspondence concerning your proposal that personnel ́in the New York area be trained for work on nuclear-powered ships. You indicated that you would like to discuss this matter with me personally.

I appreciate your interest in maintaining a satisfactory ship construction and repair capability in the New York area. As indicated in my letter of July 8, 1963, to you, we consider we now have adequate nuclear ship

construction and repair capability in being. However, I shall be pleased to discuss this matter with you. It is suggested that your office communicate with Capt. Douglas C.

Plate, U.S. Navy, of my office (telephone: code 11, extension 63452) to arrange a mutually agreeable time. Sincerely,

KENNETH E. BELIEU, Assistant Secretary of the Navy. Mr. Speaker, I think we know and can see the long-range trend in cheap commercial power on the high seas is going to be in the nuclear reactor field. I think that is shortsighted on the part of the Navy.

Mr. Speaker, I would also like to refer to a telegram sent by the Brooklyn Chamber of Commerce and signed by Mr. John C. Hilly, president, to Capt. Thomas A. King, director of the Atlantic Coast District, U.S. Maritime Administration.

He just begins to approach a point that was brought up recently by the Senate Appropriations Committee when they were going to amend the naval appropriations bill so that no vessels that would be combatant vessels or vessels belonging to the U.S. Navy could be built in any yard other than U.S. yards. That telegram is as follows:

BROOKLYN, N.Y.,

August 26, 1965. Capt. THOMAS A. KING, Director, Atlantic Coast District, U.S. Mari

time Administration, New York, N.Y.: The Brooklyn Brooklyn Chamber Chamber of Commerce wishes to go on record as being unalterably opposed to any action by the Federal Government in diverting ship repair work from the port of New York on the spurious grounds that the port is lacking either the

facilities or the skilled labor to handle such work.

There are few, if any, harbors in the United States with a more complete and diversified range of ship repair facilities than are available here. Further, we question the logic of any statement contending that there is a shortage of shipyard manpower when the current level of employment in the shipyards in this port is only a fraction of what it was at the time of the Suez crisis. It is true that many former shipyard workers have perforce found employment in other industries be

cause of the uncertain nature of this busi

ness in recent years. But it is equally true that many of these skilled craftsmen would be willing to return to these yards if they had

some assurance that their employment would not be subject to the vagaries of Federal policies seemingly bent upon favoring shipyards in other ports at the expense of the port of New York.

We join Brooklyn Borough President Abe Stark in decrying this diversion of work needed by our yards here, and make special note of the fact that the borough of Brooklyn, once a thriving shipbuilding and ship repairing center, has been reduced by this type of attrition to its present lowly state, and that even the few remaining yards here and their employees are threatened by continued diversion from the port of ship repair work essential not only to these yards but also to the national security.

JOHN C. HILLY, President, Brooklyn Chamber of Commerce.

Mr. Speaker, of course, the Secretary of Defense made his reply to Senator HAYDEN and in essence he stated that about $9 billion of defense production for Great Britain was going to be purchased in American factories in the United States and would represent about $1 billion worth of profit to American industry and that to tie the hands of the executive department and not permit them to buy some things from Great

Britain would in effect cancel more than the like amount of business America was handling.

I should like to include at this point the statement of the Secretary of Defense to the Senate Appropriations Committee.

The statement is as follows:

THE SECRETARY OF DEFENSE,
Washington, August 17, 1965.

Hon. CARL HAYDEN,
Chairman, Committee on Appropriations,
U.S. Senate

DEAR MR. CHAIRMAN: I am writing in connection with your consideration on Wednesday, August 18, of the proposed amendment to the defense appropriations bill which would impose an absolute prohibition on the purchase of ships abroad.

During the past 4 years, our Government has taken orders for the sale to foreign governments of over $9 billion of U.S.-manufactured defense products. These orders will provide over 1 million man-years of employment for U.S. labor and produce almost $1 billion in additional profits to U.S. industry. Of even greater importance to our Government, the sales will bring 9 billion in dollar payments as a partial offset to our adverse balance of payments. These are unsubsidized sales: They are the result of actions taken personally by Presidents Kennedy and Johnson and Secretaries Dillon, Fowler, McNamara, and Vance. They are good for U.S. labor, good for U.S. business, and essential

to our Nation.

Recently Mr. Vance and I participated in negotiations with the British Government which led to firm orders for the sale of almost a billion dollars of U.S.-manufactured equipment and options for the sale of several hundred million more. Because these orders required the approval of the Prime Minister and the British Cabinet and because they

resulted in the cancellation of the British TSR-2 fighter aircraft program and the elimination in that one program of over 22,000 jobs in the United Kingdom, the British asked that we agree to buy a small amount of defense products from their industries. I stated we could give no such assurance. They then modified their request and asked that we agree as a matter of principle to consider the procurement of certain defense items from British suppliers when such suppliers were fully competitive in terms of quality and costs with U.S. manufacturers. This we agreed to do. To date, under this

arrangement, we have procured nothing from British firms and I do not anticipate that in the future we would procure from the United Kingdom as much as even 10 percent of our sales to them. For us to achieve those sales, however, it is absolutely essential that we have the right to make such procurements when these can be justified on the basis of competitive standards of quality and cost. Such procurements are entirely consistent with the Buy American Act which requires the Government to procure from U.S. manufacturers except where the national interest will be better served by buying abroad. At present, I am insisting that the Defense Department procure its equipment

and services from U.S. manufacturers when

ever this can be done at a price not in excess of 50 percent above the price offered by foreign manufacturers-I plan to continue that policy except in those isolated cases where the national interest requires other action. The proposed amendment to the defense appropriations bill would prohibit such exceptions in the national interest and almost surely would result in the cancellation of British orders from U.S. manufac

turers.

I strongly urge you to vote against the

amendment.

Sincerely,

ROBERT S. MCNAMARA.

Bayonne, Jersey City, and Hoboken, contributes in a tremendous way to the great commerce operations which help to make our Nation the most affluent power in the world today.

Mr. Speaker, I ask unanimous consent to revise and extend my remarks and include extraneous matter.

The SPEAKER. Is there objection to the request of the gentleman from New York?

There was no objection.

Mr. DANIELS. I compliment the gentleman from New York for his contribution. I am personally aware of the great tion. I am personally aware of the great interest which he has displayed in this problem over the past few years while problem over the past few years while he has been a Member of Congress. He has worked with me in an effort to try has worked with me in an effort to try to find some solution to the problems to find some solution to the problems which face our shipyards. I am sure he will agree that we not only have the necessary capacity, the drydocks, but also have the necessary skilled workmen to do the job which the Navy and the Maritime Administration require at the present time on these ships which are presently being released from the mothball fleet.

I thank the gentleman from New York for his contribution in this matter today. Mr. GALLAGHER. Mr. Speaker, will the gentleman yield?

Mr. DANIELS. I am happy to yield to the gentleman from New Jersey.

Mr. GALLAGHER. I should like to join with the gentleman in spotlighting join with the gentleman in spotlighting this critical problem for the New York this critical problem for the New York and New Jersey port.

I listened to the remarks of the distinguished gentleman from New York [Mr. MURPHY], and I certainly concur with him.

I should like to compliment my distinguished colleague from New Jersey for the great leadership which he has given in the Congress by spotlighting this very serious problem. I know from personal experience of the work the gentleman has done in behalf of the ship repair and shipbuilding industry in the New York and New Jersey port. Once again, the gentleman is doing a great service for the district and for our State by pointing up a very serious oversight on the part of the Maritime Administration.

Mr. Speaker, the New York-New Jersey port area has always been recognized as one of the main and vital commercial and military ports of call in the world. Ships flying every flag and trucks from every State in the Union load and unload daily. The New York

But while remaining a prosperous port, the New York-New Jersey area has been sustaining a great decline in another vital and necessary area; namely, ship repair and refitting. In the years since World War II New York-New Jersey concerns dealing in repair and drydock services have been steadily operating at a loss. In 1944 at the peak of wartime a loss. production area ship repair businesses employed 46,000 persons. In 1949, the peacetime peak, New York-New Jersey port area concerns employed 6,000 men. This in itself was quite a drop. However, the trend has continued and in 1964 the figure had dropped to 2,500 men employed. I think these figures accurately reflect the drastic decline in ship repair and refitting in the area.

Of course, the reasons for this decline are many and varied. One reason could be that the United States has fallen from prominence in the shipping industry and much of our seagoing trade has been taken over by foreign operators. ship repair and refitting facilities in the However, one of the main reasons that ing results from the Federal GovernNew York-New Jersey area are declinment's failure to distribute contracts to area concerns. In 1964, of the $9 billion allocated for ship repair and refitting by the Department of Defense, only $272 million in contracts went to yards in New York and New Jersey. This figure represents a little over 3 percent of the total.

It seems strange that one of the largest ports in the world and a port area coneffort should receive 3 percent of the tributing a great deal to our defense repair and refitting work. An example of the importance of this area is the Bayonne Navy Yard which is in the port authority area. This yard has been designated Military Ocean Terminal for the Eastern Area, Military Traffic Management and Terminal Service. Bayonne will become the focal point of troop and cargo operations for the entire 23 Eastern States.

The case which has been receiving the greatest publicity in the past week concerns the one ship from Jones Point which has been sent to Chester, Pa., to be recommissioned and this case is only an example of the Maritime Administration's neglect of the New York-New Jersey repair operations. This example points up the reason why these area concerns are declining.

I have been assured by representatives of the interested parties that the yards in Hoboken could easily complete the work of refitting these six mothball fleet ships, not just five of them. I see no logical reason for going to the expense and trouble of towing these ships away from the area when facilities exist close at hand to complete the job.

The present war which we are engaged in in Vietnam is only one example of the need for the United States to keep in full and efficient working order the ship