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Fbom Secretary Op Treasury To Chairman Smith
Treasury Department,

Washington, April S, HK&.

jft i > Kar Me. Chairman: Under date of March 18, Secretary Mellon .Hj(|r,,K!^«-«:l to you a letter giving his views on H. R. 0826, being the bill to cover the Boulder Dam project on the Colorado River. In comnn***^ * lug on the fiscal policy In the original bill Secretary Mellon augm-at^*! a more flexible method of handling than the bond issue provi«l«»«* in tne original bill, and at your request I am herewith submittinc- "draft of the legislation carrying out the suggestion made by Se-or-*?-tary Mellon in his letter of March 18.

Th« ff urpose of this suggestion is to create a fund which will be cliarg*»€Jl with the cost of construction, plus interest during construction. ii x» «1 Into which all revenues from the project will flow, and from w Inich appropriations for operation and maintenance will be made. The fund will also be charged with current interest, and any

nel <-ar«^ Ings of the project, after operation, maintenance, and Interest, will L>e icturned to the Treasury and used for debt reduction. The Trrasur-y is given complete flexibility in handling the financing by the I'alhxl £3 tales of the cost of the project.

"CTo »agress adopts the project, the suggestions I have made are Quite m- «r> »-kable from the Treasury's standpoint. "^^ «?ry truly yours,

Garrard B. Winston, Acting tiecretary of the Treasury, Hor» _ _-Xomso.N T. Smith,

«—~Muiirman Committee on Irrigation and Reclamation,

House of Representatives.

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TENTATIVE SUBSTITUTE FOR SECTION 2 OF H. R. 9828

SC"- S- (a) There is hereby established a special fund to be known '•TM«* *" Colorado River dam fund" (hereinafter referred to as the '***•* "> , and to be available, as hereinafter provided, only for carry***•» *-" the provisions of this act. All revenues received In carrying provisions of this act shall be paid Into, and expenditures shall a out of, the fund, under the direction of the Secretary of the

•• "•«» XT'.

. -- * "-*""' fce Secretary of the Treasury Is authorized to advance to the nmo»" *'*~«im time to time and within the appropriations therefor, such ,ag ** *" ** as the Secretary of the Interior deems necessary for carry.,.„•»-. ** t the provisions of this act, except that the aggregate amount of ***i"v-ances shall not exceed the sum of $125,000,000. Interest at of 4 per cent per annum accruing during the year upon the advanced and remaining unpaid shall be paid annually fund.

In the fund advanced under subdivision (b) shall be only for expenditures for construction and the payment of during construction upon the amounts so advanced. No out of the fund shall be made for operation and main cxcept from appropriations therefor.

The Secretary of the Treasury shall charge the fund as of of 30 in each year with such amount as may be necessary for .- payment of Interest on advance made under subdivision (b) at the rate of 4 per centum per annum accrued during the year upon the amounts so advanced and remaining unpaid, except that If the fund Is insufficient to meet the payment of interest the Secretary of the Treasury may, in his discretion, defer any part of such payment, and the amount so deferred shall bear Interest at the rate of 4 per cent per annum until paid.

(e) The Secretary of the Interior shall certify to the Secretary of tue Treasury at the close of each fiscal year the amount of money in the fund in excess of the amount necessary for construction, operation, and maintenance, and payment of Interest. Upon receipt of each Mich certificate, the Secretary of the Treasury is authorized and directed to charge the fund with the amount so certified as repayment of the advances made under subdivision (b), which amount shall be covered into the Treasury to the credit of miscellaneous receipts, and shall be available for the purposes specified In subdivision (g).

If) In order to make the advances to the fund, the Secretary of the Treasury may. If he deems advisable, exercise the authority granted by the various Liberty bond acts and the Victory loan act, as amended anil supplemented, to Issue bonds, notes, and certificates of indebtedness of the United States, and any bonds so issued shall be dlsregardnl in computing the maximum amount of bonds authorized by ttectiun 1, of the second Liberty bond act, as amended.

(g) The Secretary of the Treasury is authorized and directed to u«e. upon such terms and conditions as he may prescribe for the payment, redemption, or purchase, at not to exceed par and accrued Imprest, of any bonds, notes, or certificates of Indebtedness of the United States, the money covered into the Treasury under subdivisions (e) in repayment of the amounts advanced.

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ACT AUTHORIZING THE- APPOINTMENT OF COMMISSIONERS

[Public—No. 50—67th Congress] An act (H. R. 6877) to permit a compact or agreement between the

States of Arizona, California, Colorado. Nevada, New Mexico, Utah,

and Wyoming, respecting the disposition and apportionment of the

waters of the Colorado River, and for other purposes

Whereas the Colorado River and its several tributaries rise within and flow through or from the boundaries between the States of Arizona, California, Colorado, Nevada, New Mexico, Utah, and Wyoming; and

Whereas the territory Included within the drainage area of the said stream and its tributaries is largely arid and in small part Irrigated, and the present and future development necessities and general welfare of each of the said States and of the United States require tha further use of the waters of said streams for Irrigation and other beneficial purposes and that future litigation and conflict respecting the use and distribution of said waters should be avoided and settled by compact between said States; and

Whereas the said States, by appropriate legislation, have authorized the governors thereof to appoint commissioners to represent said States for the purpose of entering into a compact or agreement between said States respecting the future utilization and disposition of the waters of the Colorado River and of the streams tributary thereto; and

Whereas the governors of said several States have named and appointed their respective commissioners for the purposes aforesaid and have presented their resolution to the President of the United States requesting the appointment of a representative on behalf of the United States to participate in said negotiations and to represent the interests of the United States: Now, therefore,

Be Uenacted, etc., That consent of Con.cress is hereby given to the States of Arizona, California, Colorado, Nevada, New Mexico, Utah, and Wyoming to negotiate and cuter into a compact or agreement not later than January 1. 1023, providing for an equitable division and apportionment among said States of the water supply of the Colorado River and of the streams tributary thereto, upon condition that a suitable person, who shall be appointed by the President of the United States, shall participate in said negotiations as the representative of and for the protection of the Interests of the United States, and shall make report to Congress of the proceedings and of any compact or agreement entered into, and the sum of $10,000, or so much thereof as may be necessary, Is hereby authorized to be appropriated to pay the salary and expenses of the representative of the United States appointed hereunder: Provided, That any such compact or agreement shall not be binding or obligatory upon any of the parties thereto unless and until the same shall have been approved by the legislature of each of said States and by the Congress of the United States.

Sec. 2. That the right to alter, amend, or repeal this act is herewith expressly reserved.

Approved, August 19, 1921.

Colorado River Compact, Signed At Santa Fb, N. Mix., Novembeb

24, 1022

The States of Arizona, California, Colorado, Nevada, New Mexico, Utah, and Wyoming, having resolved to enter into a compact under the act of the Congress of the United States of America, approved August 19, 1921 (42 Stat. L., 171), and the acts of the legislatures of the said States, have through their governors appointed as their commissioners: W. S. Norviel for the State of Arizona, W. F. McClure for the State of California, Delph E. Carpenter for the State of Colorado, J. G. Scrugham for the State of Nevada, Stephen B. Davis, Jr., for the State of New Mexico, R. E. Caldwell for the State of Utah, Frank C. Emerson for the State of Wyoming, who, after negotiations participated In by Herbert Hoover, appointed by the President as the representative of the United States of America, have agreed upon the following articles.

Article I

The major purposes of this compact are to provide for the equitable division and apportionment of the use of the waters of the Colorado River system; to establish the relative importance of different beneficial uses of water; to promote Interstate comity; to remove causes of present and future controversies; and to secure the expeditious agricultural and Industrial development of the Colorado River Basin, the storage of its waters, and the protection of life and property from floods. To these ends the Colorado River Basin is divided into two • basins, and an apportionment of the use of part of the water of the Colorado River system Is made to each of them with the provision that further equitable apportionments may be made.

ART1CLH II

As used In this compact:

(a) The term "Colorado River system" means that portion of the Colorado River and its tributaries within the United States of America.

(b) The term "Colorado River Basin" means all of the drainage area of the Colorado River lyatem and all other territory within the United States of America to which the waters of the Colorado River system shall be beneficially applied.

(c) The term "Sbites of the upper division" means the States of Colorado, New Mexico, Utah, and Wyoming.

(d) The term "States of the lower division" means the States of Arizona, California, and Nevada.

(e) The term "Lee Ferry" means a point In the main stream of the Colorado Hiver 1 mile below the mouth of the Paxla River.

(f) Tbe term "upper basin" means those parts of the States of Arizona, Colorado, New Mexico, Utah, and Wyoming within and from which waters naturally drain into the Colorado Elver system above Lee Ferry, and also all parts of said States located without the drainage area of the Colorado River system which are now or shall hereafter be beneficially served by waters diverted from the system above Lee Ferry.

(g) Tbe term "lower basin" means those parts of the States of Arizona, California, Nevada, New Mexico, and Utah within and from which waters naturally drain Into the Colorado River system below J.ce Ferry, and also nil parts of said States located without the drainage urea of the Colorado Kivcr system which are now or shall hereafter be beneficially served by waters diverted from the system below Lee Ferry.

(h) The term "domestic use" shall include the use of water for household, stock, municipal, mining, milling. Industrial, and other like purposes, but shall exclude the generation of electrical power.

ABTICLB III

(a) There Is hereby apportioned from the Colorado River system In perpetuity to the upper basin and to the lower basin, respectively, the exclusive beneficial consumptive use of 7.500,000 acre-feet of water per annum, which shall Include all water necessary for the supply of auy rights which may now exist.

(b) In addition to the apportionment In paragraph (a) the lower basin is hereby given the right to increase Its beneficial consumptive use of such waters by 1,000,000 acre-feet per annum.

(c) If, as u matter of international comity, the United States of America shall hereafter recognize In the United States of Mexico any right to the use of any waters of the Colorado River system, such waters shall be supplied first from the waters which are surplus over and above the aggregate of the quantities specified in paragraphs (a) and (b) ; and If such surplus shall prove insufficient for this purpose, theu the burden of guch deficiency shall be equally borne by the upper basin and the lower basin, and whenever necessary the States of the upper division shall deliver at Lee Ferry water to supply one-half of the deficiency so recognized In addition to that provided in paragraph (d).

(d) The States of the upper division will not cause the flow of the river at I^ec Ferry to be depleted below an aggregate of 7!>,000,000 acrefeet for any period of 10 consecutive years reckoned In continuing progressive series beginning with the 1st day of October next succeeding the ratification of this compact.

(e) The States of the upper division shall not withhold water, and the States of the lower division shall not require the delivery of water, which can not reasonably be applied to domestic and agricultural uses.

(f) Further equitable apportionment of the beneficial uses of the waters of the Colorado River system uuapportloncd by paragraphs (a), (b), and (c) may be made In the manner provided in paragraph (g) at any time after October 1, 1963, if and when either basin shall have reached its total beneficial consumptive use as set out in paragraph (a) and (b).

(g) In the event of a desire for a further apportionment as provided In paragraph (f) any two signatory States, acting through their governors, may give Joint notice of such desire to the governors of the other signatory States and to the President of the United States of America, and it shall be the duty of the governors of the signatory States and of the President of the United States of America forthwith to appoint representatives, whose duty it shall be to divide and apportion equitably between the upper basin and lower basin the beneficial use of the uuapportioncd water of the Colorado River system as mentioned In paragraph (f), subject to the legislative ratification of the signatory States and the Congress of the United States of America.

AKTICLB IV

(a) Inasmuch as the Colorado River has ceased to be navigable for commerce and the reservation of its waters for navigation would teriouslv limit the development of its basin, the use of its waters for purposes of navigation shall be subservient to the uses of such waters for domestic, agricultural, and power purposes. If the Congress shall not consent to this paragraph, the other provisions of this compact shall nevertheless remain binding.

(b) Subject to the provisions of this compact, water of the Colorado River system may be Impounded and used for the generation of electrical power, but such impounding and use shall be subservient to the use and consumption of such water for agricultural and domestic purposes and shall not Interfere with or prevent use for such dominant purposes.

(c) The provisions of this article shall not apply to or Interfere with the regulation and control by any State within Its boundaries of the appropriation, use, and distribution of water.

ARTICLE V

The chief official of each signatory State charged with the administration of water rights, together with the Director of the United States Reclamation Service and the Director of the United States Geological Survey, shall cooperate, ex officio—

(a) To promote the systematic determination and coordination of the facts as to flow, appropriation, consumption, and use of water In the Colorado River Basin, and the interchange of available information in such matters.

(b) To secure the ascertainment and publication of the annual Sow of the Colorado River at Lee Ferry.

(c) To perform such other duties as may be assigned by mutual consent of the signatories from time to time.

ARTICLE VI

Should any claim or controversy arise between any two or more of the signatory States: (a) With respect to the waters of the Colorado River system not covered by the terms of this compact; (b) over the meaning or performance of any of the terms of this compact; (c) as to the allocation of the burdens incident to the performance of any article of this compact or the delivery of waters as herein provided; (d) as to the construction or operation of works within the Colorado River Basin to be situated in two or more States, or to be constructed in one State for the benefit of another State; or (e) as to the diversion of water In one State for the benefit of another State, the governors of the States affected upon the request of one of them, shall forthwith appoint commissioners with power to consider and adjust such claim or controversy, subject to ratification by the legislatures of the States so affected.

Nothing herein contained shall prevent the adjustment of any such claim or controversy by any present method or by direct future legislative action of the Interested States.

ABTICLB VII

Nothing in this compact shall be construed as affecting the obligations of the United States of America to Indian tribes.

ARTICLE VIII

Present perfected righu to the beneficial use of waters of the Colorado River system are unimpaired by this contract. Whenever storage capacity of 5,000,000 acre-feet shall have been provided on the main Colorado River within or for the benefit of the lower basin, then claims of such rights, If any, by appropriates or users of water In the lower basin against nppropriators or users of water In the upper basin shall attach to and be satisfied from water that may be stored not in conflict with Article III

All other rights to beneficial use of waters of the Colorado River system shall be satisfied solely from the water apportioned to that basin in which they are situate.

ABTICLB IX

Nothing In this compact shall be construed to limit or prevent any State from Instituting or maintaining any action or proceeding, legal or equitable, for the protection of any right under this compact or the enforcement of any of its provisions. Abticlb x

This compact may be terminated at any time by the unanimous agreement of the signatory States. In the event of such termination, all rights established under It shall continue unimpaired.

ABTICLE XI

This compact shall become binding and obligatory when It shall have been approved by the legislatures of each of the signatory States and by the Congress of the United States. Notice of approval by the legislatures shall be given by the governor of each signatory State to the governors of the other signatory States and to the President of the United States, and the President of the United States Is requested to give notice to the governors of the signatory States of approval by the Congress of the United States.

In witness whereof the commissioners have signed this compact In a single original, which shall be deposited In tbe archives of the Department of State of the United States of America and of which a duly certified copy shall be forwarded to the governor of each of the signatory States.

Done at the city of Santa Fe, N. Mex., this 24th day of November, A. D. 1022.

W. S. NOBVIEL.

W. F. McCLUBB. Delph E. Cabpenteb. J. G. ScnncHAii. Stkphzn B. Davis, Jr. R. E. Caldwell. Frank C. Emkbson. Approved:

Hehbebt Hoovm.

THE BOARD OF APPEALS AND MHWCAI. ADMINISTRATION OF THE VETERANS' BUREAU

Mr. CHALMERS. I ask unanimous consent, Mr. Speaker, to speak for two minutes.

The SPEAKER. Is there objection?

There was no objection.

Mr. CHALMERS. Mr. Speaker and Members of the House, I desire to correct the Record in the remarks I made as reported on page 8347 by inserting "medical" before "administration." I have no criticism to offer to General Hiries's management of the Veterans' Bureau. I believe General Hines is endeavoring to give justice to the veterans and at the same time represent the interests of the taxpayers. My criticism was directed against the hard-boiled methods of the board of appeals and medical ndvisers. All of the cases I have appealed to the board of appeals in the last seven years I have never had a reversal of the regional rating board in a single case. It seems to me that tbe medical mental attitude is too strict. They place too strict a construction on all cases referred to them. Why, even in the dock the prisoner has the benefit of the doubt. It seems to me that hi these aggravated cases, where it is necessary for either the Federal Government or a private institution to assist the veteran and his dejiendents, if there is a doubt the veteran should have the benefit of It.

I have a case in hand in my district where a young man who offered his life for his country, and did his bit overseas, is now totally disabled in a sick ward in the National Military Home hi Day tun, Ohio, and his family is dependent upon county help in one of the counties irt my district. When this veteran's case was appealed to the board of appeals in Chicago we received an adverse decision. I then asked for a reopening of his case in the Cincinnati regional office. I filed medical testimony from Dr. H. M. Montgomery, Dr. C. B. Fiuefrock, and Dr. C. J. YeLsley, three of the most prominent and efficient medical authorities in northwestern Ohio, and yet this very day I have had n letter from the regional manager declining to reopen this case. This veteran's wife and children are residing on a farm near Port Clinton, the county seat of Ottawa County. The brave little wife and mother is attempting to keep the family together, while her husband is a totally disabled case and in the Dayton hospital. I consider that while this boy's dependents are a county charge in my district it is a personal reflection upon me. I propose to appeal this case to Washington and fight it to a successful finish, if possible. That will take months. In the meantime how will the family exist? Their only resource is public and private charity. I consider that this is not only a reflection upon me, but upon the Federal Government. I want to thus forcibly call this case, which I suppose is typical of thousands, to your attention and at the same time charge the medical rulings of the Veterans' Bureau in interpreting legislative enactment as being too strict and not friendly enough to the veteran.

The SPEAKER. Without objection, the Record will be so corrected.

There was no objection.

Pensions

Mr. W. T. FITZGERALD. Mr. Speaker, I ask unanimous consent to take from the Speaker's table H. R. 10159, granting pensions and increase of pensions to widows and former widows of certain soldiers, sailors, and marines of the Civil War, and for other purposes, with Senate amendments, disagree to the Senate amendments, and ask for a conference.

The SPEAKER. The gentleman from Ohio asks unanimous consent to take from the Speaker's table House bill 101D9, with Senate amendments, disagree to the Senate amendments, and ask for a conference. Is there objection?

There was no objection.

The SPEAKER. The Chair appoints the following conferees: Messrs. W. T. Fitzgerald, Elliott, Beebs, Lozier, and UnderWood.

Speaker Pro T1jmpore For To-morrow

The SPEAKER. The Chair designates the gentleman from Louisiana, Mr. Aswell, to preside at the memorial exercises to-morrow.

ORDER or BUSINESS

The SPEAKER. Under the special order of the House the Chair recognizes the gentleman from Alabama [Mr. Almon] for 15 minutes.

Mr. RANKIN. Mr. Speaker, I make the point of order that there is no quorum present.

The SPEAKER. The gentleman from Mississippi makes the point of order that there is no quorum present. Evidently there is no quorum present.

Mr. TILSON. Mr. Speaker, I move a call of the House.

A call of the House was ordered.

LXIX 539

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The SPEAKER pro tempore (Mr. Snell). Three hundred Members have answered to their names, a quorum.

On motion of Mr. Tilson, further proceedings under the call were dispensed with.

CONFERENCE REPORT—AGRICULTURAL SURPLUS CONTROL BILL

Mr. HAUGEN. Mr. Speaker, I submit a conference report on Senate bill 8iK>r>, to establish a Federal farm board to aid in the orderly marketing and in the control and disposition of the surplus of agricultural commodities in interstate and foreign commerce, for printing in the Record.

MUSCLE SHOALS

The SPEAKER pro tempore. Under the special order of the House the Chair recognizes the gentleman from Alabama [Mr. Almon] for 15 minutes.

Mr. ALMON. Mr. Speaker, there is in Washington now and has been for several days the greatest lobby, representing the greatest and most vicious trust that ever existed in America. They are here by the scores. The lobby that sent the power investigation resolution to the Federal Trade Commission did not compare with the lobby here to-day against the best interests of American farmers.

There is on the calendar—and I will explain why I have asked for this short time—the Muscle Shoals bill, which will be considered on next Wednesday. I did not have an opportunity to make any remarks concerning it on last Wednesday, and I will probably not be given an opportunity to say anything about it next Wednesday.

There is a great hue and cry going up from that lobby that the Government is going into business in competition with private capital and that it is unreasonable, unfair, and undemocratic. I want to tell you, my friends, that the Government is already in business at Muscle Shoals. You voted $120,000.000 there. This great nitrate plant, one of the largest in tbe world, was built during the war and finished just as the war ended, and when it was finished it was 100 per cent in point of quality and production. Seventeen million dollars had been spent on the foundation of Dam No. 2 on which to build this great dam. and since the change of administration $30.000.00(1 more has been expended in the completion of that greatest dam and power development anywhere in the world. Since it was completed about two years ago the Government has been there in business operating this power plant.

The Government has been operating it for the benefit of a member of this great Water Power Trust, the Alabama Power Co. That company is taking that power at 2 mills per kilowatt and selling it to me and other people in Alabama for use In our homes for lighting purposes at a rate as high as 10. Of course, they give a better rate for industrial purposes, and where electric ranges are used. Government operation at Muscle Shoals would be nothing new. The Government is now operating the Panama Canal, Shipping Board, United States Fleet Corporation, Mississippi and Warrior River Barge Line, the Post Office Department, arsenals, the ship and navy yards, and parcel post, and is in business in many other ways.

If Congress adjourns without doing anything, the Alabama Power Co. will continue to be the sole beneficiary of this great development.

The fertilizer people say the Government ought not to make fertilizer there. Why? After the war was over the officers of the Government tried to get the fertilizer industry of this country to take over this development. They scorned the Idea. The power people would not take any interest in the dam and would not take any steps to complete it. The fertilizer people said:

We will not have anything to do with the Muscle Shoals nitrate plant. It is of no value. The entire plant there is obsolete.

The country has been flooded for two or three years with propaganda to the effect that the cyanamide process for the flxation of atmospheric nitrogen is obsolete. I knew this was not true, but I wanted first-hand information to give you when Congress convened, and I went over into Canada last summer and visited a plant exactly like the one at Muscle Shoals, using the same process. It is not so large and is not as good a plant, but It has been in operation continuously since 1909, doing a good business and paying the stockholders satisfactory dividends.

I have secured information in regard to plants in Germany and other Europeaa countries using the same kind of process. They also have plants using the synthetic process, and all the plants in Germany and In the other European countries that were built for wur purposes are now being used for the benefit of agriculture, and so successfully that there is no longer any importation of Chilean nitrates Into those countries. On the contrary, they have become large exporters of nitrates and fertilizers, and the American farmer to-day is buying fertilizer imported into this country from Germany.

The plant at Muscle Shoals is the only air-nitrogen plant in the United States. There is but one other on the Western Hemisphere, and that is at Niagara Falls, in Canada. The cyanamide plant at Muscle Shoals Is the only one anywhere that is' not in operation.

There is not a single dollar of private capital Invested in the United States In the manufacture of air nitrogen for the benefit of agriculture. The great plant in West Virginia and the great plant under construction at Hopewell, Va., using the synthetic process, are not expected to manufacture one pound of nitrogen that will be used in the manufacture of fertilizer. It will be used for explosives and for other industrial purposes.

A similar plant across from Niagara Falls is making nitrogen and selling some of it, to the fertilizer mixers in America for 7 cents a pound—pure nitrogen—and they are paying 20 cents a pound for nitrogen from Chile. They put it all together, nflx it up, and sell it to the poor fanner and get as much for the 7-cent cyanamide nitrogen as they do for the 20-cent nitrogen. This is one illustration of how they are treating the farmer.

They say this method is obsolete. Let me tell you what is obsolete and antiquated. It is the method of the fertilizer industry in this country. That great and good man, Milton Whitney, up to a short time ago Director of the Bureau of Soils of the Department of Agriculture, in the hearings on the Ford offer, said that the great trouble with the fertilizer industry in this country is that it is antiquated and out of date. They are nothing but a lot of fertilizer mixers. They buy every pound of nitrogen, every pound of potash, every pound of phosphate, mix it up, and send it to the farmers. They get nearly all of their nitrogen from Chile, and the first payment is $12.53 to the Chilean Government as an export duty. They have to pay the freight rates on this for 6,000 miles, and then what does the farmer get? He gets 16 per cent of nitrogen and 84 per cent of dirt. I can get dirt down in my country for $5 an acre, but under this scheme they are paying the enormous price of $64 a ton for Chilean dirt and passing it on to the farmers. Whnt does this amount to? Eleven million dollars is what the hard-worked and distressed farmers of the Nation are paying to this foreign monopoly.

If this Morin bill brings about competition with anybody, my friends, it will be competition not with private American capital but competition with a foreign monopoly, the Chilean Nitrate Corporation. [Applause.]

These people do not cure. It seems the National Fertilizer Association does not cure. So long as they can get it imported into this country and pass the cost on to the farmer it is all well and good.

They complain about Muscle Shoals being so far away. Six thousand miles from here is where they are getting it now, but they say it would be terrible for the American farmer to have to i>ay freight on a little nitrogen from Muscle Shoals, Ala.

Muscle Shoals is as well located as the Government could place it. It is probably nearer the center of that part of the country using the most fertilizer than any other place, and it is also well located from the standpoint of national defense. It is a long way from the Gulf and the Atlantic coasts, and if a foreign enemy should ever undertake to Invade this country. Muscle Shoals is well fortified.

In 1916 we enacted a law to build this plant for two fundamental purposes, one to make explosives In time of war and the other to manufacture fertilizer for the benefit of American agriculture in peace times.

What will happen if it stands there idle? If we get into another war 40 or 50 years from now, standing idle or In a stand-by condition, costing the Government $300,000 a year for maintenance, it would be rusted out and obsolete.

The fixation of atmospheric nitrogen is a comparatively new science, and it is one that is being improved on from day to day, and unless you put the plant into operation during peace times it will be of no value for national defense.

Everybody agrees that the Government must keep it, and under the Morin bill we simply provide for the organization of a Government-operated corporation. The President appoints five directors, with the consent and approval of the Senate. They appoint a manager and an assistant manager. They are selected by the President and report to Congress every year, and it will be operated Just like a private corporation, except in private corporations the directors are appointed by the stockholders and report to the stockholders. If this bill passes and President Coolidge succeeds in finding five business men qualified to do the Job, there is not any reason why it should not be a great success.

If it is not, Congress can discontinue it in a year. If it is a success, everybody will be satisfied. We have been trying for eight years to have private operation. Many bills have been, offered here. We passed the Henry Ford bill through the House for private operation. All offers for private operation have been rejected. It is now Government or nothing.

Let me remind you that this same fertilizer lobby was here lobbying against the Henry Kord offer. That was for private operation. So you see it is competition they are opposed to and it makes no difference whether it Is Government operation or private operation. They do not want anybody to go into the fertilizer business at Muscle Shoals. They are afraid they will make a better grade of fertilizer and that it will reduce their prices.

Why are they so concerned about Government operation? If these fertilizer companies were taking any interest in building nitrate plants in the United States to relieve the distressed farmers of the country of the burden of the foreign Chilean monopoly there would be less Justification for the Government operating the plant. So long as they take no steps to get for the farmer a better and cheaper grade of fertilizer we are Justified in operating our own plant Congress said in 1916 that this was lor the purpose of making fertilizer in peace time, and we are only doing Just what Congress directed in 1916 should be done.

Now this fertilizer lobby is making a great plea for the poor farmer who can not pay cash for his fertilizer. Yon all remember the way they sell fertilizer to the farmer who can not pay cash. They charge him about $8 a ton more on time between planting and gathering the crop and 8 per cent interest in addition. Now they come and make a great appeal for the poor farmer that can not pay cash. They complain because the Government proposes to give away 5 per cent of the product for experimental purposes. They do not think that is right.

You see this fertilizer lobby hanging around here. There were so many in the gallery the other day they called it the fertilizer gallery. [Laughter.] They were here in crowds; and Charles J. Brand, the leader of it, was formerly a director of the bureau of markets in the Department of Agriculture, and it is said they had to abolish that department to get rid of him. That was one of the most valuable bureaus we had in the department.

When the roll was called the other day and it was decided to adjourn and give them another week's time for the lobby to work against the bill, this fertilizer crowd all scattered anil clapped their hands and Brand Jumped up and said, "Come on, boys, meet me at 283, the Mayflower Hotel." It is said they have almost a whole floor there, at that magnificent and expensive hotel, although they say they arc losing money. The enormous expense of this lobby will no doubt be passed on to the poor farmer.

The SPEAKER pro ternpore. The time of the gentleman has expired.

Mr. ALMON7. Mr. Sneaker. I ask for 15 minutes more.

The SPEAKEH pro toiupore. Is there objection?

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There was no objection.

Mr. ALMON. Mr. Speaker, there are three bills to be voted

°d next Wednesday afternoon. I think we have plenty of votes

1(1 Pass the Morin bill if the friends of the farmer will come here

*irt remain and stay on the job until the last roll is called.

J have been voting for farm relief ever since I have been a

Memlier of this House. I voted for the McNary-Haugen bill

to 1!K>4 and again in 1926 and again in 1028. I voted for the

h'tigation projects. Your arid lands needed water. Almost

every section of the country is now needing and buying fertilizer

JiJH] is calling for a better grade and cheaper fertilizer In order

to replenish the soil.

J'ou all ought to be interested In this, because agriculture is the basic industry of this country. When that prospers all the People prosper. When that suffers the whole citizenry suffers it. The Norris bill passed the Senate providing for Govoperations through the Department of Agriculture, $10,000,000. The idea of turning a great industrial like this over to a Government bureau. That bureau 2-ss every four years, and sometimes the Secretary of Agrihas been changed oftener than once in four years.

is another bill, the Morin bill, providing a real Govit operating corporation. After that bill had been rea few days ago our good friend Mr. Snell, from New Yorl^:, «^hairman of the Kules Committee, now in the chair, put in a t»ill providing for Government operation by the same bureau and f<^ T experimentation. Air nitrogen has long since passed the

stage.

not know who wrote my friend Snell's bill. Of course, as tl»c» chairman of the Committee on Rules he has not the time to w j~i t:e such a bill as that. It takes an expert. If Tom Martin, the irn-^sident of the Alabama Power Co., or some other power com i^a^ny attorney, did not send it to Mr. Snell, then I have nimlt? ^b. very poor guess. There is not a pound of fertilizer in it. If tx^y friend Mr. Snei.l's bill ever passes, there will not be a of fertilizer made, and the $47,000,000 of the people's that went into that dam and the power house will go into nds of the Alabama Power Co. for all time, and they will to put these prices on the people. They have not rethe prices on power one penny since they began buying at 2 mills per kilowatt from the Government at Muscle

- I live within C miles of that dam, and I pay as much

as anybody down in Mobile, or anywhere else in that of the country, not know whether we get that power. It goes into the

- They tell the Public Utilities Commission of Alabama

can not reduce their rates by reason of getting this at 2 mills per kilowatt-hour, and if this Congress adwithout passing some legislation, they will continue to benefits of it. They take only a small part of the <~y of the plant and the balance runs to waste.

very fond of my friend Snell. He came down to Shoals at my invitation. I told the folks down there great and good man he was, and what a power he had House. They all got interested. I had my colleague ^nkhead to come up to meet his chairman of the Rules ittee. We met Mr. Snell at the depot of my home, Tus*., with a brass band and gave him a great banquet. We t»ve him an old-fashioned southern barbecue, and he said * *•« was entertained with hospitality that no other people extend like the southern people. He made a speech. !• ~«-:iced him, of course. I told what a great man he was, a power he was in the House. I told them that he up here and do anything that he wanted to about • Shoals. Mr. Bankhead indorsed all I said about Mr. and added some. [Laughter.] He made a great speech, course, told my friends and neighbors what an able and Congressman they had. [Applause.] He made a jErricultural speech, a farmers' speech, and I believe my is interested in the farmer. He made a great speech *- ^a effect: "Now, this thing has been dragging along too If I had known how it was going, I would have come iere earlier. It is a shame and a disgrace. It is a re.Jti on Congress that this plant is not put into operation •kxat that power is not sold for what it is worth." ^ __ MOORE of Virginia. Could the gentleman tell us what

Snell said?

-_ ALMON. He said, "I am in favor of private operation
> =3 plant. I think the Government ought to lease it, and
can not get a satisfactory lease, then I am in favor ot
^""toment operation." [Applause.] I reminded him of that
this Morin bill caine up, but he said, "Oh, I meant the
kind of Government operation." [Laughter.] The ques-
ts* whether this bill is right or whether his bill is right
r- WKIGHT. Is the Snell bill a fertilizer bill}

[graphic]
[graphic]

Mr. ALMON. No; It is a water power bill, pure and simple. There is not au ounce of fertilizer in this bill. The bill under consideration was sent here by a Committee of Twenty-one, headed by my friend Mr. Mobin, of Pennsylvania, chairman of the great Committee on Military Affairs. Let me read the names of the members on that committee: There is Mr. Mobin, of Pennsylvania, who is the chairman; there is Mr. Frank James, of Michigan; Mr. Wurzbach, of Texas; Mr. Ukece, of Tennessee; Mr. Speaks, of Ohio; Mr. Waikwkight, of New York; Mr. FurLow, of Minnesota; Mr. Johnson, of Illinois; Mr. Huohes, of West Virginia ; Mr. Hoffman, of New Jersey; Mr. Quin, of Mississippi; Mr. Fisheb, of Tennessee; Mr. Weight, of Georgia; Mr. Gabbett, of Texas; Mr. Mcswain, of South Carolina; Mr. Boylan, of New York; Mr. Hill, of Alabama; and Mr. ChapMan, of Kentucky—18 of the good and strong men of the House. The most of these 18 members who wrote this bill have given this subject 8 years of faithful and efficient study. Colleagues, stand by your committee. [Applause.] They have turned down all of these private bills on the grounds that they did not protect the interests of the Government. I want all of you gentlemen to be here on next Wednesday afternoon and stay here and pass this bill. [Applause.]

I see from the propaganda that is being resorted to by the opposition of this measure that the bill does not have the approval of the representatives of certain farm organizations. That may be true, but it does not mean that if the farmers themselves had an opportunity to know just what this bill means they would not indorse it almost unanimously. The legislative representatives of the farm organizations opposing this bill do not represent the views and best interest of the farmers themselves. Some of these representatives say they are opposed to Government operation. I did not favor Government operation of Muscle Shoals until I found it was that or nothing. What does the farmer care whether his fertilizer is made by the Government or a private corporation provided he gets it cheaper and a better grade or quality In a concentrated form, and saves millions of dollars In freight rates on fertilizer containing only about 12 per cent plant food. This bill simply means that the Government is to make fertilizer at Muscle Shoals and sell it direct to the farmers and farm organizations at actual cost of production, and without interest on the Government investment for the first five years, and then only 4 per cent per annum on money hereafter paid in as capital stock.

Chile nitrate costs $47 per ton. Same amount of nitrate in cyanamide can be produced at Muscle Shoals for $23.56, with power that Government is now selling Alabama Power Co. for $3.35.

1 wonder how any Member of this House, especially one representing an agricultural district, could defend his vote against this bill. I would dislike very much to undertake to defend such a vote before a constituency of intelligent farmers such as I represent, and such as my colleagues from agricultural districts represent. We owe it to ourselves, to the Government, and to the farmers of America to pass this bill.

This same power and fertilizer lobby was here six years ago opposing the Ford bill which provided for private operation at Muscle Shoals. Examine the hearings on the Ford bill and your letter files, of you who were here at that time, and you will find that they were making the same claims. That is that Ford would put them out of business. The power monopoly feared Ford as a competitor. They knew that he would demonstrate to the public that the people were paying extortionate and unreasonable prices for power. The Fertilizer Trust did not want Ford as a competitor in the fertilizer business. They knew that he would reduce the price of fertilizer and make a better grade. So it, is not Government operation but competition that they fear and oppose. [Applause.]

Mr. Charles J. Brand, secretary-treasurer National Fertilizer Association, has flooded the Members of Congress with publications for the past 30 days. One of hi.s complaints is that under the Morin bill fertilizer is to be sold for cash, and that would inure to the detriment of the poor man who can not pay cash. They charge the man who buys on time about 15 per cent more than for cash, and 8 per cent interest additional. No doubt many farmers who buy on credit now would be able lo pay cash if they could get the fertilizer for about one-third less than existing prices. As a further evidence of their interest in the farmer they object to that part of the bill which authorizes the Government to donate to the farmers 5 per cent of the products of the plant for experimental purposes. I wonder if they object to what the Government is doing in the way of furnishing farmers information through agricultural yearbooks, farmers' bulletins, and assistance rendered through the Bureau of Animal Industry in teaching farmers how to treat their livestock and improve the breeds. Is It not just as im

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