1951 CONGRESSIONAL RECORD-SENATE 351 Elwyn M. Stimson Richard J. Ofstad . ·. Senator from West Virginia [Mr. KIL­ Albert Arsenault · Julius W. Ireland SENATE GORE] are absent on public business. Frank A. Gunner, Jr. Harold E. Allen The Senator from Tennessee [Mr. KE­ David A. Van Evera Harold G. · Schlender- WEDNESQAY, JANUARY 17, 1951 John V. Kelsey ing FAUVER] is absent by leave of t.he Senate. John F. Corbett Charles E. Hinsdale , rdo). A-4164096, Simon, John Ottmar Behrendt A-9025392, Voiantzi, Ioannis, or Ioannis A-5638913, Pericao, Joao Da Cruz. Probst, or John Ottmar Simons. Vogiatzis or John or Jwannov Bogiantje. A-4917347, Peroulas, George Athanasios, or A-4586164, Singelmann, Emma Catharina. A-6514877, Volodkin, John George. Gerog Peroulis or Peroulos. A-2978714, Singh, Banta, or Banta Singh A-1782036, Vukic, Mate Yerolin, or Mate Y. A-9635859, Philipoom, Jacobus, or Jacobus Sandhu. Vukik. Philipoon. A-6799539, Singh, Agapita. Vera de, or A-5821738, Walter, Andrey. A-4128148, Pina, Sebastiano Lobo, or Leo Agapita Vera-Mesa de Singh. A-7092906, Ways, Israle, or Israel Wais. Lobo Pina. A-1662520, Sissea, John Pantilimon, or A-4793441, Weber, Boris, or Boris Rodwi- A-2654505, Pioli, Pietro, or Guido Tagliont. John P. Sissea or loan P. Sissea. · vitch or Boris Rodsenwitsch. A-9690823, Pires, Jose, or Joseph Pires. A-50466\9, Skimos. John Konstantinos, or A-4089854, Wehby, Malababa, or Mabel A-3113558, Pittas, Antonios J. Ioannis or John Skembos. Wehby (nee Jarishe). A- 5920208, Portolos, Alexandros, or Alex A-9825182, Skorstad, Harold Norman, or A-3799015, Wehby, Farhat, or Fred Wehby Portolos. Harald Skarstad. A-6725069, Westfall, Forest Elgin. A-3416094, Postma, Tjibbe, or Ted Postma. A-4876899, Snoo, Johannes De, or Robert A-1417320, Wever, Joseph, or Joseph A-1327390, Potulski, Bruno Hans or Po- Desmew. Weaver. 1ukski. A-4719578, Sofariu, Alexander Dionise, or A-3567493, Whiteman, James Carlile. A- 2991322, Pous, Francisco Liso, or Fran­ Alex Safar. A-5008544, Wicknig, Willy Arthur, or Wil· cisco Pous. A-3959194, Soichinoff, Sotir, or Sotirios liam Wicking. A-5139014, Pejak, Dusas, or Dane Payock. Doichinis Carulos (alias Sotiris Doichins A-5621809, Wilhelm, Otto Bernhard, or Otto A-7009946, Previto, Joseph, or Joseph John Cora.las). Williams. Previto or Giuseppe Previto. A-7203566, Soyum, Jesus, or Jesus Ed­ A-2488388, Wilson, William Barton. A-1096841, Privitera, Santo. mondson. A-4421512, Wing, Lee. A-6373166, Profus, Aaron, or Aron. Profus. A-7203567, Soyum, Pascual, or Pascual Ed­ A-3130290, Wood, Kerttu Pohja. A-5127776, Puhar, Andre, or Andy Puhar or mondson. A-2130263, Workun, Anton, or Tony or Andre Puhar. A-7203568, Soyum, Gregorio, or Gregorio Anthony Workin or Workman. A-5694835, Puzo, Carmine Filippo, or Car­ Edmondson. A-5353860, Wright, Arthur Smedley. mine Puzo. A-5518362, Spiers, Annie. A-5022006, Yaago, Anton. A-1340505, Ramnath, Lola, or Lala Ram. A-5280366, Spiers, Colman, or Colman A-4261547, Yip, Mary, or Yip Lum Mui. math Jain. Spierer. A-2533819, Young, Mrs. Hung Sum, or Ng A-7581989, Rapeports, Heinrich Chaikel, or A-3416037, Sprude, Edward Jakos. Ye Mui. Heinrich Rapeports. A-6577001, Slawinski, Anna Jadwica. A-5434778, Yovanovich, Tomelco, or Tem­ A-2866349, Ratti, Ignio. A-6577000, Slawinski, Eugenjuz Stanislaw, elco Yvanoff Gargis or Tom Evans (alias A-1944224, Rey, Daniel Tome, or Daniel or Eugene S. Slawinski .. Tomelco Yovanoff Corgis alias Tomerkon Tome Raz. A-6975360, Stathis, Helene Theodorou (nee Georgiou). A-6145160, Rey, Lucio Lopez. Helene Theodorou Gapsanls) . A-3982915, Yun, Eung Pal Yun, or Eung Pal A-2648624, Ribuffi, Francesco, or Frank A-5467398, Struck, Ferdinand Fritz, or Yoon. Ribuffi. Friedrich Steen. A-3416158, Yun, Sang Soon, or Sang Soon A-3074394, Rigas, Emanuel Ioar.nis, or A-2718405, Sullivan, Tatiana (nee Yarema Kum. Mike Rigas. or Tatiana Solovay). A-5535882, Zabala, Rafael Basteguieta, or A-7140844, Ritter, Frank, or Frank Harold A-3228816, Sze, Agnes Chi Chen (nee Lin). Rafael B. Zahala or Rafael Zabela or Ralph Theodor Ritter or Frank Theodor Ritter. PR-909850, Sze, Morgan Chuan-Yuan. Zabala. · A-3843498, Roncevic, Anti Yakov, or Tony A-1188912, Tagliamonte, Ginnaro, or Gen- A-2701568, Zaharia, Dumitru. Roneevich on Ante Roncevic or Tony Jack naro Tagliamonte. A-3906860, Zampas, Charles, or Kyriakos Roncevic or Ante Yakov Roncevic. A-3457399, Tomerias, Bernard John, or Oroilcolou Zampas. A-1019866, Ro~ase, Shaleh, or Shaleh La­ Bernhard John Tomerias. A-3243888, Zampas, Laura, or Dovlad Greg­ haer. A-3739861, Tanaka, Michiko (nee Ikeda). ory Kovouk. A-2522951, Roussos, Loucas Ale:icandros. A-3496620, Tanaka, Tsunezo. A-5333950, Zanikos, Demetrios, or James A-4341666, Ryecroft, Lnlie (formerly Wil· A-5137137, Tarino, Romeo, or Remeo Mag· George. Uam Leslie Bennett) . gio Tarino. A-2653930, Zannakis, Demetrius, or James A-5841824, Said, Ali Mohamed, or Moabsen A-1738959, Taiark.is or Michail Taxiarkis or Zanakis. Furhan Said. Michael Taxiarkis. A-6394967, Zervos, Dionisios Anthon1. 356 CONGRESSIONAL. RECORD-SENArr·E JANUARY 17 A-1706871, Zimmerman, John. ·first session, submits the following report By Mr. RNOWLAND (for himself'. and A-4978968, l;isimos, Sotirios; or Demetrios showing the ·name, profession, and total Mr. NIXON); or James Carras. salary of each :Person employed by it and its S. 528. A bill to confer jurisdiction on the A-4546677, Zopoulos, George. subcommittees for the period from July 1, United States District Court for the Northern A-2074345, Zoumpoulakas, Ioannis Paulo, 1950, to December 31, 1950, together with the District of California to hear, determine, and or John Paul Zoompoulakis or John Zoum­ funds available to and expended by it and render judgment upon certain claims of the poulakis. its subcommittees: State of California; to the Committee on the Judiciary. REVISION AND PRINTING OF SENATE Rate of . By Mr. McMAHON: MANUAL Total S. 529. A bill for the relief of Humayag Dil­ Name and profession gross salary Mr. HAYDEN. Mr. President, from annual received dilian and his daughter, Lucy Dildilian; and the Committee on Rules and Adminis· salary S. 530. A bill for the relief of Gerhard tration I report back favorably, without H. A. Anton Bebr; to the Committee on the Bobo, Virginia, assistant chief clerk. $4, 849. 61 $2, 424. 80 Judiciary. amendment, Senate Resolution 4, and Brawley, H. W., staff director ..... 10, 846.00 5, 423. 00 By Mr. NEELY (by request): ask unanimous consent for its immediate Chrissos, Costas D., clerical assist- ant ...... •...... • 4, 415.10 2, 207. 55 S. 531. A bill to amend section 1537 of the consideration. F aucette, Andrew McO. (1 month, act entitled "An act to establish a code of There being no objection, the resolu· Dec. 1-31, 1950), professional staff law for the District of Columbia," approved member ...... 10, 846.00 903. 85 March 3, 1901, as amended, so as to provide tion

COPPER SHIPMENTS of Commerce finally issued an order which likewise was reliably informed by officials in After denying that exports of copper from barred the transportation or discharge by the National Defense Agency that after they the United States occurred during 1950, the American ships and aircraft of strategic and learned of the extremely large shipments Secretary admitted that one transshipment critical materials destined for countries in they had taken the position that tin plate of copper took place in February 1950 from the Soviet bloc, China, Hong Kong, and waste waste should be placed on the positive J apan through this country and around the Macao. list. world to the Communists in China. He de­ PETROLATUM Ag

In March the House Committee on the had been unable to restore the desired com­ It was taken out in conference.13 The Judiciary made its report on the bill that petition under the Clayton Act, and Congress chairman of the House managers, Mr. Utter­ became the act. Section 2 (b) was then in evidently sought to open the way for effec­ back, before the conference report was substantially its wesent form. The report tive action.11 agreed to by the House, received permission pointed out the draftsmen's purpose to Events in the course of the proposed legis­ to print an explanation of his understanding strengthen the laws against price discrimina­ lation in the Senate and House have perti­ of the proviso. He explained that the proviso . tion, directly or indirectly, through broker­ nence. The Senate inserted the original in­ "does not set up the meeting of competition age or other allowances, services, or absorp­ effective language of the Clayton Act in its as an absolute bar to a charge of discrimina­ tions of costs.8 It commented that the sub­ exact form in the Senate bill. In the same tion under the bill. It merely permits it to section that became section 2 (b) let a seller draft it adopted an amendment similar to be shown in evidence. * * * It leaves it a "meet the price actually previously offered the proviso ultimately enacted (80 CoNGRES­ question of fact to be determined in each by a local competitor." 9 SIONAL RECORD 6426, 6435). In the House, case, whether the competition to be met was The language used in regard to competi­ Representative PATMAN explained his view such as to justify the discrimination given." tion in the bills and in the act seems to have of the dangers in the original proviso.12 The pertinent parts of the statement appear in the margin.14 been based on a recommendation of the Fed­ 11 eral Trade Commission.10 The Commission Id., p. 64: "If the discrimination is 'on account of differences in the grade, quality, 13 or quantity of the commodity sold,' or makes H. Rept. No. 2951, 74th Cong., 2d sess., pp. 8 H. Rept. No. 2287, 74th Cong., 2d sess., 'only due all.owance for difference in the cost 6-7: "The Senate bill contained a further p. 3: "The purpose of this proposed legisla­ of selling or transportation,' or is 'made in proviso 'That nothing herein contained shall tion is to restore, so far as possible, equality good faith to meet competition,' it is not prevent discrimination in price in the same of opportunity in business by strengthening unlawful, even though the effect 'may be to or different communities made in good faith antitrust laws and by protecting trade and substantially lessen competition or tend to to meet competition.' This language is commerce against unfair trade practices and create a monopoly in any line of commerce.' found in existing law, and in the opinion of unlawful price discrimination, and also Discrimi;natory price concessions given to the conferees is one of the obstacles to en­ against restraint and monopoly for the bet­ prevent the loss of a chain-store's business forcement of the present Clayton Act. The ter protection of consumers, workers, . and to a competing manufacturer, to prevent it Senate receded, and the language is stricken. independent producers, manufacturers, mer­ manufacturing its own goods, or to prevent it A provision relating to the question of meet­ chants, and other businessmen. To accom­ from discouraging in its stores the sale of a ing competition, intended to operate only plish its purpose, the bill amends and given manufacturer's goods, may be strongly as a rule of evidence in a proceeding before strengthens the Clayton Act by prohibiting urged by the manufacturer as 'made in good the Federal Trade Commission, is included in discriminations in price between purchasers faith to meet competition'" (see p. 90, id.). subsection (b) in the conference text as fol­ where such discriminations cannot be shown Attention was called to this need. H. Rept. lows: 'Provided, however, That nothing here­ to be justified by differences in the cost of No. 2287, 74th Cong., 2d sess., p. 7: "Some of in contained shall prevent a seller rebutting manufacture, sale, or delivery resulting from the prima facie case thus made by showing · the difficulties of enforcement of this sec­ that his lower price or the furnishing of different methods or quantities in which such tion as it stands are pointed out in the [final commodities are to such purchasers sold and report) of the 1',ederal Trade Commission services or facilities to any purchaser or pur­ delivered. It also prohibits brokerage allow­ chasers was made in good faith to meet an above referred to, at pages 63 and following." equally low price of a competitor, or the ances except for services actually rendered, 12 80 CONGRESSIONAL RECORD 8235: "Mr. and advertising and other service allowances services or facilites furnished by ·a com­ unless such allowances or services are made Chairman, I would like to ask a question of petitor.'" the gentleman from Texas [Mr. PATMAN]. A 14 available to all purchasers on proportionally great many of the industries in Ohio were 80 CONGRESSIONAL RECORD 9418: "In con­ equal terms. It strikes at the basing-point very much in favor of the proviso in the Sen­ nection with the above rule as to burden of m':!thod of sale, which lessens competition ate bill, appearing on page 4, and reading as proof, it is also provided that a seller may and tends to create a monopoly." show that his lower price was made in good 0 follows: "And provided further, That nothing id., p. 16: "This proviso represents a herein contained shall prevent discrimina­ faith to meet an equally low price of a com­ contraction of an ex.emption now contained tion in price in the same or different com­ petitor, or that his furnishing of services or in section 2 of the Clayton Act which per­ modities made in good faith to meet compe­ facilities was made in good faith to meet mits discriminations without limit where tition.' I find that on page 9 of the Patman those furnished by a competitor. It is to made in good faith to meet competition. It bill, beginning in line 14, there appear these be noted, however, that this does not set up should be noted that while the seller is per­ words: 'Provided, however, That nothing the meeting of competition as an absolute mitted to meet local competition it does not herein contained shall prevent a seller re­ bar to a charge of discrimination under the permit him to cut local prices until his butting the prim·a facie case thus made . by bill. It merely permits it to be shown in competitor has first offered lower prices, and showing that his lower price to any pur­ evidence. This provision is entirely pro­ then he can go no further than to meet chaser or purchasers was made in good faith cedural. It does not determine substantive those prices. If he goes further he must do to meet an equally low price of a competitor.' rights, liabilities, and duties. They are fixed so likewise with all his other customers, or Will the gentleman explain the difference in the other provisions of the bill. It leaves make himself liable to all of the penalties of between these two proposals? it a question of fact to be determined in the act, including treble damages. In other "Mr. PATMAN. If the Senate amendment each case, whether the competition to be met words, the proviso permits the seller to meet should be adopted it would really destroy the was such as to justify the discrimination the price actually previously offered by a bill. It would permit the corporate chains given, as one lying within the limitations local competitor. It permits him to go no to go into a local market, cut the price down laid down by the bill, and whether the way further." in which the competition was met lies within 1 so low that it would destroy local competi­ 0 Final Report on the Chain-Store Investi­ tors and make up for their losses in other the latitude alfowed by those limitations. gation, S. Doc. No. 4, 74th Cong., 1st sess., places where they had already destroyed This procedural provisi9n cannot be con­ p. 96: "A simple solution for the uncertain­ their competitors. One of the objects of strued as a carte blanche exemption to vio­ ties and difficulties of enforcement would be the bill is to get around that phrase and pre­ late the bill so long as a competitor can be to prohibit unfair and unjust discrimination vent the large corporate chains from selling shown to have violated it first, nor so long fn price and leave it to the enforcement below cost in certain localities, thus destroy­ as that competition cannot be met without agency, subject to review by the courts, to ing the independent merchants, and making the use of oppressive discriminations in vio­ apply that principle to particular cases and it up at other places where their competitors lation of the obvious intent of the situations. The soundness of and extent to have already been destroyed. I hope the bill. • * • If this proviso were construed which the present provisos would consti­ gentleman will not insist on the Senate to permit the showing of a competing offer tute valid defenses would thus become a amendment, because it would ·be very de­ as an absolute bar to liability for discrimina­ judicial and not a legislative matter. The structive of the bill. The phrase 'equally tion, then it would nullify the act entirely at Commission therefore recommends that sec­ low price' means the corporate chain will the very inception of its enforcement, for tion 2 of the Clayton Act be amended to . have the right to compete with the local in nearly every case mass buyers receive sim­ read as follows: 'It shall be unlawful for merchants. They may meet competition, ilar discriminations from competing sellers any person engaged in commerce, in any which is all right, but they cannot cut down of the same product. One violation ·of law transaction in or affecting such commerce, the price below cost for the purpose of de­ cannot be permitted to justify anotner. As either directly or indirectly to discriminate stroying the local man. in any case of self-defense, while the attack unfairly or unjustly in price between differ­ "Mr. COOPER of Ohio. What does the gen­ against which the defense is . claimed may ent purchasers of commodities, which com­ tleman's proviso mean? modities are sold for use, consumption, or be shown in evidence, its competency as a "Mr. PATMAN. It means they may . meet bar depends also upon whether it was a legal resale within the United States or any Ter­ competition, but not cut down the price ritory thereof or the District of Columbia or below cost. It means an equally low price or illegal attack. A discrimination in viola­ any insular possession or other place under but not below that. It permits competition, tion of this bill is in practical effect a com­ the jurisdiction of the United States.'" This but it does not permit them to cut the price mercial bribe to lure the business of the report was utilized by the House committee below cost in order to destroy their competi­ favored customer away froin the competitor, dealing with the proposed Robinson-Patman tors. I hope the gentleman will not insist and if one bribe were permitted to justify legislation . H. Rept. No. 2287, 74th Cong., on the Senate amendment." (But see pp. another the bill would be futile to achieve 2d sess., pp. 3, 7. 15 and 16, infra~. its plainly intended purposes." 378 CONGRESSIONAL RECORD-SENATE JANUARY 17

II the phrasing. Unlike the original statute~ in each case, raising a question of fact as to Statutory interpretation: This resume of section 2 of the Robinson-Patman Act is whether the competition justified the dis­ the origin and purpose of the original section divided into two subsections. The first, sec­ crimir:a tion. See the conference report, 2 of the Clayton Act and the amendments of tion 2 (a), retained the statement of sub­ House Report No. 2951, Seventy-fourth Con­ the Robinson-Patman Act gives a basis for stantive offense and the series of provisos gress, second session, pages 6-7; see also the determining the effect of this section in a t:eated by the Commission as affording full statement of Representative Utterback, the hearing before the Commission where the justifications for price discriminations; sec­ chairman of the House conference commit­ charge, as here, that a seller during the same tion 2 (b) was created to deal with proce. tee, 80 CONGRESSIONAL RECORD 9418." period of time has sold the same commodi­ dural problems in Federal Trade Commission After that statement, which it should be ties to various purchasers at different prices, pnceedings--specifically to treat the ques­ noted relies upon Mr.· Utterback's interpreta­ is admitted and the defense, the elements of tion of burden of proof. In the process of tion quoted at note 14 of this opinion, the which are likewise admitted, is that the this division, the meeting-competition pro­ Court in the Staley case goes on to say that discrimination was made in good faith to vision was separated from the other provisos, there was no evidence to show that Staley meet an equally low price of a competitor. set off from the substantive provisions of adopted a lower pr_ice to meet an equally Does meeting in good faith a competitor's section 2 (a), and relegated to the position low price of a competitor. Again there was price constitute a complete defense under of a proviso to the procedural subsection, no occasion for this court to meet the present the proviso to section 2 (b) ? Or does the section 2 (b). Unless it is believed that this issue. We think our citation in Staley fact of good faith reduction in price to a change of position was fortuitous, it can be quoted above, shows the then position of this purchaser to meet a competitor's price mere­ inferred that Congress meant to curtail the Court.10 ly rebut the prima facie establishment of defense of meeting competition when it ban­ There are aguments available to support discrimination, arising under the statute ished this proviso from the substantive divi­ the contrary position. No definite statement from proof of forbidden differences in price,15 sion to thl:l procedural. In the same way, the appears in the committee reports that meet­ so as to require under section 2 (a) affirma­ language changes made by section 2 (b) of ing competition is henceforth to be only a tive finding by the Commission that there the Robinson-Patman Act refiect an intent rebuttal of a prima facie case and not a may be injury to competition? Petitioner to diminish the effectiveness of the sweeping full justification for discrimination in price. asserts that good faith meeing of a com­ defense offered by the Clayton Act's meet­ The proviso of section 2 (b) can be read petitor's price is a complete defense. The ing-of-competition proviso. The original as having the same substantive effect as the Commission and the Court of Appeals· take provisos in the Clayton Act, and the pro­ provisos of section 2 (a) . The earlier provi­ the opposite position, with which we visos now appearing in section 2 (a) , are sos are treated by the Commission as com­ concur. worded to make it clear that nothing shall plete defenses. Perhaps there is an implica­ This is our reason. The statutory develop­ prevent certain price practices, such as "price tion favorable to the petitioner's position in ment and the information before Congress differentials • • • [making] • • • Representative PATMAN's omission to state concerning the need for strengthening the due allowance for differences in the cost of the Federal Trade Commission interpreta­ competitive price provision of the Clayton manufacture,'' or "price changes • tion on the floor. See note 12, supra. Act, make clear that the evil dealt with by in response to changing conditions affecting The underlying congressional purpose to the proviso of section 2 (b) was the easy the market for • • • the goods con­ curtail methods of avoiding limitations on avoidance of the prohibition against price­ cerned." But in contrast to these provisions, price discriminations, however, considered discrimination. The control of that evil was the proviso to section 2 (b) does not provide with the more specific matters discussed an important objective of the Robinson­ that nothing "shall prevent" a certain price herein, satisfies us that we should adopt Patman Act. The debates, the Commission's practice; it provides only that "nothing shall the conclusion of the Commission and the report and recommendation and statutory prevent a seller rebutting • • • [a] court of appeals.17 We believe that good changes show this. The conference report • • • prima facie case by showing" a faith meeting of a competitor's price only and the explanation by one of the managers, ce!'tain price practice-meeting a competi­ rebuts the prima facie case of violation es­ Mr. Utterback, are quite definitive upon the tive price. The language thus shifts the tablished by showing the price discrimina:­ poirit. Because of experience under the focus of the proviso from a matter of sub· tion. Whether the proven price discrl,mina­ Clayton Act, Congress refused to continue st::mtive defense to a matter of proof. Con• tion is of a character that violates section 2. its competitive price proviso. Yet adoption sistent with each other, these modifications (a) then becomes a matter for the deter­ of petitioner's position would permit a seller made by the Robinson-Patman Act are also mination of the Commission on a. showing of nationally distributed goods to discrill).i­ consistent with the intent of Congress ex­ that there may be injury to competition. nate in favor of large chain retailers, for the pressed in the legislative history. seller could give to the large retailer a price The Court suggests that former Federal m lo-:ver than that charged to small retailers, Trade Commission cases decided here have Conclusion: In view of the Court's ruling, and couid then completely justify its dis­ treated the meeting-competition clause of we will not enlarge this dissent by discussing crimination by showing that the large re­ the Robinson-Patman Act as being an abso­ other problems raised by the case. We have tailer had first obtained the same low price lute defense, not merely a rebuttal of the said enough to show that we would affirm from a local low-cost producer of competi­ discrimination charge requiring further find­ the decree below in principle, even though tive goods. This is the very type of competi­ ing by the Commission. Reference ls mad~ we should conclude some amendment might tion that Congress sought to remedy. To to Corn Products Refining Co. v. Federal be required in the wording of the order. permit this would not seem consonant with Trade Comm'n (324 U. S. 726) and Federal The Chief Justice and Mr. Justice Black the other provisions of the Robinson-Patman Trade Comm'n v. Staley Mfg. Co. (324 U. S. join in this dissent. Act, strengthening regulatory powers of the 746). In the Corn Products case, dealing Commission in quantity sales, special allow­ with a basing-point scheme for delivered 16 The court's opinion in this case refers, ances, and changing economic conditions. prices, this Court merely said at page 741: page 12, notes 12 and 13, to the opinions of The structure. and wording of the Robin­ "The only evidence said to rebut the prima the Court of Appeals for the Seventh Circuit son-Patman amentlment to the Clayton Act facie case made by proof of the price dis­ in Staley and Corn Products (144 F. 2d and also conduce to our conclusion. In the orig.. criminations was given by witnesses who had 221). But that court reversed its position inal Clayton Act, section 2 was not divided no personal knowledge of the transactions, in the opinion below (173 F. 2d 210, 216). It into subsections. In that statute, section 2 and was limited to statements of each wit­ is fair to assume that reversal was because of str-.ted the body of the substantive offense, ness' assumption or conclusion that the price our opinions in Corn Products and Staley. and then listed, in a series of provisos, various discriminations were justified by competi­ 17 circumstances under which discriminations It is hardly necessary to note that the tion." wisdom of the enactment is not for the Com­ in price were permissible. Thus, the statute And then went on to use the language provided that discriminations were not ille­ mission nor the courts in enforcing the act. quoted at page 12 of the Court's opinion. The Commission recently has advised Con­ gal if made on account of differences in the There was no occasion to consider the effect grade of the commodity sold or differences gress that while "on balance it would be of a successful rebuttal. As authority for preferable to make the good faith meeting in selling or transportation costs. Listed its statement, we there cited the Staley case among these absolute justifications of the of competition a complete defense,'' it "does (at 324 U. S. 746). not strongly urge either view upon the Con­ Clayton Act appeared the provision that That citation included these words at pages "nothing herein contained shall prevent dis­ gress." Hearings before Subcommittee No. 1 752-753: of the House Committee on the Judiciary on crimination in price • • • made in good "Prior to the Robinson-Patman amend­ faith to meet competition." The Robinson­ S. 1008, 81st Cong., 1st sess., June 8 and 14, ments, section 2 of the Clayton Act provided 1949, p. 61. Compare Standard Oil Co. v. Patman Act, however, made two changes in · that nothing contained in it 'shall prevent' respect of the meeting-competition provi­ United States (337 U.S. 293, 311). This state­ · discrimination in price 'made in good faith ment confirmed the Commission's position sion-one as to its location, the other in to meet competition.' The change in lan­ taken in this case. There were other omcials guage of this exception was for the purpose of the Commission who have taken the view • 1G See note 6, supra. of making the defense a matter of evidence adopted by the Court. 1951 CONGRESSIONAL · RECORD-SENATE 379 PROGRAM FOi.-t ACQUISITION OF WOOL rubber in this country if we have to. on November 28 the wholesale price index AND INCREASING GROWTH OF THE The actions announced recently by reached an all-time record high of 171.7. GUAYULE SHRUB . Chairman Small of the Munitions Board At that time I quoted certain figures ·Mr. JOHNSON of Texas. Mr. Presi­ are definitely steps in the right direction. demonstrating that since April 1950 the dent, as chairman of the ·Preparedness He deserves commendation for it. price of burlap had increased 75.6 per­ Subcommittee of the Senate Committee Other agencies could learn from his cent; the price of copper was up 32.6 on Armed Services I want my colleagues exJ.mple. percent; the price of hides was up 50.8 to k!low that we are as ready to com­ Mr. President, I desire now to refer to percent; the price of wool had been mend as we are to criticize. When we another subject. boosted 67 .6 percent; and the price of find something in the defense mobiliza­ The PRESIDING OFFICER. The crude rubber had increased an unbe­ tion program that deserves praise we are Senator from Texas has the floor. lievable 209.5 percent. as willing and anxious to point out that IMPRACTICABILITY OF VOLUNTARY In line with my promise to show again fact as we are to comment upon de- PRICE CONTROLS and again, through facts and :figures, the ficiencies in that program. · Mr. JOHNSON of Texas. Mr. Presi­ impracticability of voluntary · controls Vigorous action to correct deficiencies dent, on August 12 of last year, I pointed during wartime, I ask unanimous con­ and omissions in defense mobilization as out that it would be useless to increase sent to insert at this point in the RECORD soon as they have been ascertained is taxes if prices were permitted to rise to a statement entitled "Military Procure­ praiseworthy indeed. such a point that the tax gain would be ment Price Trends," and a tabulation of The new Chairman of the Munitions erased through the necessity of paying "Military Procurement Prices Before.and Board, Mr. John D. ·Small, has shown continually advancing prices for war After the Attack on Korea," both pre­ that the Board can and will take prompt pareq by the Office of the Secretary of materials. Defense. action. As the committee has recently On September 12, I placed in the REC­ recommended, wool and guayule seed and ORD a tabulation showing how prices had There being no objection, the state­ seedlings have now been placed on the advanced out of all proportion on hun­ ment and tabulation were ordered to be ~trategic and critical materials' list for dreds of essential items. printed in the RECORD, as follows: stockpiling. This action is definitely a On September 22, I cited in the REC­ MILITARY PROCUREM-ENT PRICE TRENDS · substantial step in the right direction. ORD a few of the more flagrant instances: Since the spring of 1950, prices have risen By .taking this step Chairman Small has The increase by 111 percent in the price markedly, particularly after the start of the corrected serious omissions of his prede­ conflict in Korea. The Bureau of Labor Sta­ of crude rubber since the attack on Ko­ tistics wholesale-price index is now at an cessors, and I hope that aggresive pro­ rea; the increase by more than 30 per- grams for acquiring wool and preparing all-time high, reaching a level of 171.7 on . cent, over a period of only ::i, few months, November 28, a rise of 12.3 percent since to grow natural rubber in the United in the price of aviation gasoline; an April 1950 and an increase of 2.5 percent States will finally repair the damage re­ increase from 22 to 42 percent, between during the past 2 months. Many basic raw sulting from inaction over the past 3 April and September, in the price of the materials have increased in price to an even years. cloth from which uniforms are made. greater extent than have finished commod­ The Preparedness Subcommittee's On December 12, I asked the Senate ities, including a number of key commodities first and second reports stressed the need used in the manufacture of items required once more "What are we waiting for?" by the armed services, as shown by the fol­ for growing, or preparing to grow, nat­ and pointed out the alarming fact that ural rubber from guayule within the lowing table: boundaries of the United States. The President's rubber program as reported Price Percent increase to the subcommittee by Mr. Stuart Commodity Unit Symington, chairman of the National April Sept. 8, Dec. 4, April to April to Septem­ Security Resources Board, included the 1950 Septem- Decem- ber to De· 1950 1950 ber ber cember planning and studies on preliminary ------1-----1------actions that should be taken to grow. Burlap ______------______------__ Yard ______Pound ______$0.172 $0. 242 $0. 302 40. 7 75. 6 24.8 natural rubber in this country. I am Copper----- ___ ------______-----___ .184 • 234 .244 27. 2 32. 6 Cotton ______do._------4.3 happy to report that an active program _____ do ______.320 • 407 .412 27. 2 28. 8 1.2 Hides.Crude rubber------______• 210 • 550 .650 161. 9 209. 5 18. 2 ,to increase the available seed needed to _____ do._----~- .242 .330 .365 36.4 Lead ______------_____do ______50. 8 10. 6 grow guayule shrub is under way. In Print .cloth, cotton ______Yard ______.105 .160 .170 52. 4 61. 9 6. 2 Ton ______.140 . 210 . 225 50. 0 60. 7 7.1 addition, test acreages of guayule shrub Steel scrap (Philadelphia) •••• ~----- 24. 000 38. 000 38. 500 58. 3 60.4 1.3 will be set out in various parts of the TinWool. __ tops_------______Pound do ______------• 750 . 990 1. 390 32. 0 85.3 40. 4 ...•..do ______1. 870 3. 020 3. 135 61. 5 67. 6 3. 8 country believed adapted to its growth Zinc. ___ ------.112 .182 .182 62. 5 62. 5 in order to give farmers experience in growing this crop and to make certain what areas and what soils are best suited Due to the existence of fixed price con­ uary 1951 indicates the following price in­ tracts for many items; the rise in basic com­ creases per gallon for normal production: for large production should our supplies modity prices was not fully and immediate­ of natural rubber from the Far East be ly reflected in procurement prices paid by Novem­ curtailed or cut off. the armed services. However, the increase ber 1950 in general price level is being felt more and i My esteeme 1 and hard-working fellow · July 1, average more by the armed services. With the ex­ 1950, quota- Percent committee member, the junior Senator ception of meats, the price of which has tion for increase from Wyoming [Mr. HUNT l developed average January dropped seasonally during the past 2 months, 1951 for the Sena'.;e Armed Services Com­ and a few other scattered items, higher , delivery mittee, long before formation of the Pre­ prices are being encountered in an ever in­ ______paredness Subcommittee, the lamentable creasing number of items. These price rises Grade 115/145 Avgas: and distressing shortage of wool. His are becoming increasingly widespread de· United States Gulf .•• $0.1675 $0.1725 3.0 spite efforts to reduce costs wherever fea­ West coast______.1565 .1775 13.4 early efforts, along with the recent study sible by simplification of specifications and Grade 100/130 Av gas: by the Preparedness Subcommittee ·set United States Gulf ••. .155 .16 3.2 substitution of materials. The recent steel West coast______.144 .165 14. 6 forth in the third report, have been industry wage and price increases will un­ notable contributions which have finally doubtedly lead to further increases . in the moved the defense agencies. prices of many military procurement items. However, normal production is not ade­ One of the key commodities affected by quate to meet current armed services' needs I hope we have time to obtain the wool the Korean conflict has been aviation gaso· for aviation gasoline. Consequently, part of we need. I am sure we are on the right line. Preliminary screening of offers for de· the aviation gasoline supplies of. the armed road in actively planning to grow natur~l livery of aviation gasoline starting in Jan• services are being derived from marginal 380 CONGRESSIONAL RECORD-SENATE JANUARY. 17 production, utilizing materials, plant facili­ It must be recognized that it is difHcult clauses in contracts, etc. Direct price com­ ties, and transportation practices that are to compare prlces at different times for much parisons can best be made on relatively not economtcal under normal conditions. of the materiel procured by the armed serv­ standard-type items that are subject to little As a result, premiums of varying amounts ices because of changes in quantities in­ change in specifications. Such a list of rep­ are being paid for the supply increments volved, changes in specifications, changes in resentative items, indicating procurement furnished from marginal sources, ranging manufacturing methods and processing tech­ prices applicable to each of the services and f?'om 5 to 45 percent, depending upon the niques, resort to marginal producers or to the Armed Services Petroleum Purchasing particular circumstances involved. methods, existence of price redetermination Agency, is contained in the attached table: Military procurement prices before and after the attack on Korea (April 1950, August-September 1950, and October-November 1950)

Price Percent increase or decrease ( -)

Commodity August­ October­ April to April to August- Unit Ap1·il 1950 September November August­ October­ Se8~~~:to 1950 1950 September November November

A. 8. P. P . A.: Fuel oil, f. o. b. tanker: West coast ______------BarreL ______$0. 99 $1. 53 1$2.10 54. 5 112.1 37.3 Caribbean ______--______----___ - ---- _- _____ ------_____ do_----_ --_ 1. 70 1.83 11. 92 7.6 12. 9 4. 9 Motor gasoline, f. o. b. tanker: West coast_ ::. ____ ------_------__ do ______3. 90 4.38 14. 59 12. 3 17. 7 4.8 United States GuJL ______------__ ------_____ do ______3. 59 3.82 14.30 6.4 19. 8 12.6 Diesel fuel, f. o. b. tanker: . West coast_ ___ ------_____ do ______3.33 3. 28 13.65 -1.5 9.6 11.3 . United States Gulf___ ------______-;: ______do _____ ---- 2. 92 3.36 13. 36 15.1 15.1 ..,._., _____ ...... Army: Ambulance, metropolitan, %-ton, 4 by 2------Each ______3, 774. 20 (2) 4, 224. 20 ------11. 9 ------Automobile, sedan, light_ __ ------_____ do ______1, 132. 00 1, 284. 00 (2) 13. 4 ------­ Truck, pick-up, ~ -ton, 4 by 2------_____ do ______952. 62 (2) l,OH. 87 ------6. 5 ------Truck, stake and plntronn, l}~ -ton, 4 by 2------_____ do ______1, 471. 77 (2) 1, 697.13 Water tank trailer, 1-ton------_____ do ______793. 17 914. 76 (2) ------i5:3------~~~~- =::::::::::::: Battery: . 2E ______--______-_- ______------_- --_- _____ do ______9. 15 11. 53 (2) 26.0 2H ______---- __ -- __ ------_------___ ------_____ do ______12. 55 14.58 (2) lG.2 3H ___ --- __ ------_------__ ------_--- _do ______11. 21 15. 84 (2) 14.3 Tire: 6.50 by 20, S,..ply ____ ------_____ do __ ------16.14 20. 46 (2) 26.8 7.50 by 20------_____ do __ ------23. 99 28. 93 33.18 20.6 Bearing bushing______------_ ---- _____ do ____ ---- • 79 ]. 38 (2) 74. 7 Gasket set _____ ------___ -~------____ -______do ______.0849 .12757 (2) 50. 3 Wiring harness_------___ ------______do ______3.12 4.14 (2) 32. 7 Fuel tank _____ ------____ --- _____ do ____ ---- 9.15 12. 75 (2) 39. 3 Sprocket______------_------___ --- _____ do ______15.00 18. 45 (2) 23.0 Nut ______------______------______do ______. 01265 . 0146 (2) 15. 4 Battery assembly hanger_------_____ do ______!l.95 3. 43 (2) Hl.3 Flange transfer brace drum______do ______1. 72 1. 99 (2) 15. 7 Filter oil breather ___ ------_____ do ______1.80 1. 95 (2) 8.3 Carriage bolts __ ------_____ do ______. 0135 . 01533 \2) 13. 6 Steering knuckle as.semblY------_____ -----_~-- --- _____ do ______15. 84 19. 9368 (2) 25. 9 Shaft (automotive)_------_____ do ______22. 77 24. 74 (2) 8. 7 Hood support ______------__ -----_------_---- _____ do ______. 77 .83 (2) 7. 8 Roller bearing ______------~ _____ do ______11. 80 12. 39 (2) 5. 0 Carburetor assembly------______do _____ ---- 22. 709 23. 7115 (2) 4.4 Steering arm _____ ------~------__ --- _____ do ______-- 7. 8178 8. 316 (2) 6. 4 GeneratoI _------_------___ • ------_____ do ____ ----- 52. 63 55. 75 (2) 5. 9 Lumber: Southern pine, No. 2 common ______M board feet .. 66. 00 97. 00 72. 00 47. 0 9.1 -25.8 Douglas fir ______------_____ do ______67. 50 82. 50 882. 50 22. 2 22.2 ...... Bailey bridges ______------Each ______37, 796. 00 51, 792. 00 a 51, 792. 00 37. 0 37. 0 ------Fite hose, cotton, rubber-lined------50 feet ______20.64 23.10 3 23.10 11. 9 11. 9 ------Astrolabe ______• ______• ______-----______Each______• __ _ 1, 200.00 1, 311. 00 81, 311. 00 9.2 9.2 ------Beach tractor------____ ------_____ do ______10, 188.00 10, 840.00 8 10, 840. 00 . 6.4 6.4 ------Storage battery______------__ ------___ ~.do ______9.07 10. 74 a 10. 74 18. 4 18.4 ------Wire rope __ ------Foot__------.1329 .164 3 .164 23.4 23.4 ------·-·- 20-ton trailer _____ ------Each ______3, 287.00 3, 540. ()() •a, 540. oo 8.0 8.0 ------215. 00 270. 00 3 270.00 25.6 25.6 ------~~~~ ~~N~--~==::=:::::::::::::::::::::::::::::::::::::::::::: :::::~~====::::: 5,345.00 5, 735. 00 a 5, 735. 00 7.3 7.3 ------Motor lead cable ___ ------Foot__------. 044 .057 3. 057 29.5 29. 5 ------Barbed wire ___ ------_------_----- ~ ------SpooL ______6.39 7.25 a 7.25 13.4 13. 4 ------Sisal rope ______------_____ ------______Foot__------__ . 03841 .0456 3.0456 18. 7 18. 7 ------1 .0355 (2) .063 --·------77. 7 8~~~· l~~~~i ~o-.-s= ::::::::::::::::::::::::::::::::::::: -Eac~~==:::::::· 68. 50 (2) 95.00 38. 7 ------...... Wire, magnet: . ------(2) No. 28 AWG------Pound ______.47 .625 ------33. 0 ------No. 27 A WG _------: ______do _____ ---- .45 (2) .63 ------40. 0 ------No. 25 A WG------·----- _____ do ______.42 (2) . 57 ------35. 8 ------Fire extinguisher ______------__ -~____ Each_------36.86 37. 98 337. 98 . (2) 3. 0 3. 0 ------.Antenna equipment, RC-292_ ------___ _.. ___ ----- _____ do ______134. 88 144. 88 7. 4 ------Switchbox, BC-658 ______------______do ______10. 05 12. 04 (2) Field wire, WD-1/TT------·----- Mile ______58. 02 68.17 74. 03 ' ~~: ~ ------21:6------8:6 Communications equipment, AN/GRC-26______Each ______(2) 11, 353. 91 12,364. 03 ------8. 9 Radio set: 263. 88 (2) 382. 50 45. 0 6, 080. 92 (2) 5, 901. 66 ·------· ------Battery,tmi::J~-~~-==:::::::::::::::::::::::::::::::~::::::::::: BA-70 ______------=====~g:::::::::_____ do ______------16. 2 ------5.01 (2) 5. 66 ------13. 0 ------Broom, corn _____ ------___ ------___ ------Dozen ______11. 25 12. 53 12. 53 11. 4 11. 4 ------Steel wool __ ------__ Pound __ -----_ .218 .265 .3407 21. 6 56.3 2$. 6 .090 .1201 .1235 33.4 37. 2 2.8 ~~~.~~~~~:-~~~-~~~~::::::::::::::::::::::::::::::::::~ -E"acg~==::::::: .4675 .5875 a. 750 25. 7 60.4 27. 7 Burlap, jute, 40-inch______Yard ______.1711 • 2325 3. 310 35. 9 81. 2 33.3 Sack, burlap, 57 by 50 inches __ ------Each ______. 4170 . 5823 3. 756 39. 6 81.3 29.8 Dish washing, machine model 180DA_ ------~---- _____ do ______1, 454. 52 1, 554. 00 a 1, 629. 06 6. 8 12. 0 4. 8 Paper, typewriter, bond------Ream ______6.435 8.36 a 9. 65 29.9 50.0 15.4 Barrier, waterproof: Type C-1_ - _------Roll ______4.16 4.90 8 5. 22 17. 8 25. 5 6. 5 Type L-2------_____ do ______11.06 11.80 813. 88 6. 7 25. 5 17.6 Type M ------_____ do ______7.45 8. 53 a 9. 35 14. 5 25. 5 9.6 Box, fiber, shipping __ ------Each ______. 82771 1. 241 a 1. 283 49. 9 55. 0 33.4 . E~~~::k;~~~:f ·t:~~ts, white______Pair______.4233 .5246 a,555 23.9 31.1 5. 8 Trousers, cotton, khaki------_____ do ___ ----- • 740 .860 8,968 16. 2 30.8 12. 6 .588 (2) .769 30.8 ------soc:S~~o~~~~hl~;~~~--=::::::::::::::::::::::::::::::::::: ~:~~:::::::::: •.575 . 635 .681 ------ioX 18. 6 7. 2 1951 CONGRESSIONAL :RECORD-SENATE 381 Military procurement prices before and after the attack on Korea (April 1950, August-September 1950, and October-November 1950)-Con.

Price Percent increase or decrease ( - )

Commodity August:.. October­ April to April to August- Unit April 1950 September November August­ October­ Se8~~~~~to 1950 1950 September November November

Army-Continued Cloth: Cotton, chambray,twill, 5-ounce 3-ounce ___ ------______Yard do ______. ' $1. 27 $1. 555 $1. fi4222 22.4 29. 3 5. 6 Wool, lining, 12-ounce ______do ______. 39 . 44 . 4607 12. 8 20. 4 6.8 1. 65 2.05 8 2. 307 24. 2 39. 8 12. 5 ·wool, serge, 15-ounce _____ ----- __ ------______------______do ______Wool, serge, 12-ounce ______------______

1 Represents estimated average of offers received in November for deliveries to start 4 Gasoline, drum, 5-gallon procurement during November 1950 was for· large quantity J anuary 1951. (1,000,000 units), awarded to a single company. ~No procurement during this peried. 6 October 1950 prices. 3 Estimated. Source: Progress Reports and Statistics, Office of Secretary of Defense, Dec. 4, 1950. LEAKAGE OF DEPARTMENT OF DEFENSE patrio tic service he has rendered the Korea. The administration and its MILITARY MESSAGES Nation in exposing the leakage of De· apologists seem to have settled on Gen. Mr. WATKINS. Mr. President, I wish partment of Defense military messages. Douglas MacArthur as the scapegoat. to take a few minutes of the time of the For some time administration apolo· In reference to that campaign, I wish Senate to compliment the junior Senator gists have been searching for a way to · to point out that Gen. Douglas Mac· from Wisconsin [Mr. McCARTHY] for the escape responsibility for the disa.ster in Arthur was not present at Tehran, 382 CONGRESSIONAL RECORD-. 'SENATE JANUARY 17 Yalta, or Potsdam v,hen the foundations I have information to the effect that secret messages, as Mr. Pearson said. Senator for the present disaster in Asia were it is standard practice to attach to clas­ McCARTHY said in a Senate speech last week sified documents the following or simi­ that if Mr. Pearson had quoted secret mes­ laid. Douglas MacArthur had no part in sages he had given aid to foreign countries pulling the rug from under Nationalist lar warning, which is notice of the con­ in efforts to break United States codes. sequences of violations of security: China and in setting the stage for Rus­ SAID HE HAD PERMISSION sian domination of Asia. This document contains information af- Douglas MacArtr.ur went into Korea, . fecting the national defense of the United Mr. Pearson replied in a statement at the not on his own initiative, but on orders States within the meaning of the espionage time that he had been told by the Pentagon laws, title 18, United States Code, sections that it was all right for him to use the mes­ of the 'President of the United States. sages if he changed dates and altered a few It 793 and 794. Transmission or revelation of was on orders from the President that its contents in any :manner to an unauthor­ words. Douglas MacArthur went into Korea ized person is prohibited by law; it is im­ Mr. Pace told the Senator the whole matter with inadequately armed and green perative that the material contained in it is being actively investigated. He said the troops. be treated with the utmost discretion. Army had not given Mr. Pearson any secret When Douglas MacArthur and his Under no circumstances shall possession messages or any messages at all from General fighting men had the Communists on the thereof, or the information therein, be given of the Army Douglas MacArthur's head­ to any personnel other than those whose quarters. run, and could have destroyed them, he Mr. Pace said the Army "did not give Mr. stopped his troops at the thirty-eighth duties specifically require knowledge there­ of. When not in use this document is Pearson permission to publish the secret mil­ parallel, on orders from Washington. chargeable to the custody of an otficer. itary messages you referred to nor any other This gave the Reds time to catch their classified infor ma ti on." breath and reform their disorganized Along with other Members of the Mr. Pearson's December 30 column said in effect that reports from General MacArthur's forces. Uni~e~ States Senate, I am anxiously awa1tmg the outcome of the active in­ headquarters and his intelligence chief Douglas MacArthur refrained from showed the Chinese Red strength in Korea ordering his airmen to bomb enemy vestigation the Army says it is conduct­ was considerably weaker than the general's troop concentrations at the Korean in_g. It· is my hope that the inquiry published statements indicated. border, on orders from Washington. will lead to a court martial and the Mr. Pace's letter was in reply to one Sen­ This allowed the enemy to marshal its subsequent punishment of such military a~or McCARTHY sent him Monday. One ques­ forces and build up its strength without personnel as may have had a hand in tion Senator McCARTHY asked was whether annoyance. · the affair, if a violation of the law has public~tion of the texts of coded messages, occurred. If it should develop that the even with the change of a few words and the Gen. Douglas MacArthur has not been date, would not "materially help enemy ex­ allowed to accept the proffered assist­ information leak was perpetrated by a civilian employee of the Defense Depart­ perts to break United States military codes." ance . of several hundred thousand Chi­ SAYS CODE IS NOT BROKEN nese Nationalist fighting men who are ment, that civilian should be punished to the full extent of the· law. Mr. Pace told Senator McCARTHY that "in willing and anxioi;.s to go into battle this instance it has been established that against communism. This, too, is on I also hope that this incident will tend cryptographic security has not been violated " orders from Washington. to bring into disrepute the kind of "inside but said he was unable for security reaso~s All these things have been done by story" reporting which is all too preva­ to explain why. Washington, from which originates the ~ent these days. That kind of report­ Mr. Pace said the specific matter submitted mg too often finds origin in the privileged to the Judge Advocate General was this ques­ campaign to shift to General MacArthur status of certain types of writers who tion from Senator McCARTHY: "Was not who­ the blame for the military disaster in in reality are not reporters, but propa­ ever handed Pearson those messages guilty Korea. gandists. of a violation of our espionage laws?" General MacArthur is a field com­ Af~er Mr. Pace released his letter Mr. Pear­ These alleged reporters have access in son issued a statement which said the basic mander whose hands are tied by politi­ many of our Federal Government build­ cal strings reaching from his headquar­ fact ~s that_ General MacArthur's press com­ ings, to private dining rooms, and other m~mques m early December reported the ters to the White House, in Washington, hide-aways which are not generally ac­ Chmese to be 1,000,000 strong, but his cables to Lake Success. cessible to the working press. In return to the Pentagon gave the Chinese strength The junior Senator from Wisconsin for this privileged status they too often as only about 100,000. He added: in his exposure of the source of the in~ lend themselves to opinion peddling "Publication 3 weeks after the retreat ob­ formation which has formed the prin­ viously could violate no security nor endan­ rather than news reporting. ' ger American forces. cipal basis for the MacArthur smear is Mr. President, it seems to me that this pulling up and exposing the very t~p­ "Senator McCARTHY seems much more in­ episode is a proper subject of investiga­ terested in getting at me than in getting the root of the campaign to discredit Mac­ tion by either the Judiciary Committee true facts to the country." Arthur. In doing this, the junior Sen­ which has jurisdiction of espionage mat~ ator from Wisconsin has had the cour­ PRESIDENTIAL POWER TO DEPLOY ters, or by the Armed Services Com­ TROOPS ABROAD age to go to the mat with one of the mittee. Nation's most powerful columnists. He I request unanimous consent to have Mr. MUNDT. Mr. President I shall has found that this columnist had ac­ printed at this point in the RECORD, as today det~in the Senate but bri~fly, but cess to, and quoted excerpts from, clas­ a part of my remarks, the Associated I should llke to call attention to the fact sified military communications from Press story about this matter. The ac­ that while we are engaged in. what the our commander in the field to his supe­ count is taken from the Saturday, Jan­ country generally considers and accepts riors at the Pentagon. Those messages uary 13, 1951, issue of the New York as a great debate on foreign policy, it is concern the strength of the forces now Herald Tribune. unfortunately true that considerable overwhelming our troops in Korea. There being no objection, the article amounts of time and attention and study After their leakage those classified mili­ was ordered to be printed in the RECORD have had to be devoted in the United tary messages were largely used a·s the as follows : , States Senate to a collateral issue not basis for the smear campaign against directly connected with foreign policy· MacArthur. ARMY INQUIRES INTO SOURCE OF PEARSON'S DATA-PACE, ANSWERING MCCARTHY, SAYS that is, the determination of a constitu~ Both General MacArthur and · his COLUMNIST QUOTED FROM SECRET MESSAGES tional question concerning the right or staff were held up to ridicule and cen­ WASHINGTON, January 12.-The Army said propriety of the President, as Com­ sure on the allegation that their intelli­ today the Drew Pearson column of Decem­ mander in Chief, to send forces abroad gence services were inaccurate and ber 30 contained "quoted excerpts from clas­ without consultation with Congress and otherwise faulty. sified (secret) messages," and an investiga- consent by Congress. Thus it was insinuated that General tion is being made. · It occurs to me, since we hear almost MacArthur and many of his closest ad­ In a letter to Senator JOSEPH R. McCARTHY.­ every day impassioned appeals from the visers were uninformed and incompe­ Republican, .Wisconsin, Secretary of the Democratic side of the aisle and from tent. · It was insidiously hinted that Army Frank Pace also said the matter is be­ the officers uptown that we should have ing submitted to the Judge Advocate Gen­ MacArthur and his aides were confused eral, the Army's top legal officer. national unity and national cooperation, ~s to the exact number of the oppos­ Mr. Pace made the letter public. It was in that the one man in the United States mg forces, and that because of this con­ response to a. demand from Senator Wh? is prepared today and equipped to fusion our troops were led into defeat in McCARTHY to know whether material in the strik.e a tremendous blow for unity is Korea. · Pearson column was in :fact quoted from President Harry S. Truman, in his posi· 1951 CONGRESSIONAL RECORD-SENATE 383 ti on as Commander in Chief. He alone Mr. MILLIKIN. It says so in exact use of the Army and the size of the can put an end to this collateral debate, words. We do not have to draw impli­ Army when they included the 2-year which is consuming so much time that cations. It also says we have the power limitation upon appropriations for the actually we have had very little oppor­ to declare war. This carries its own Army of the United States? By that tunity as yet to get down to the very implications of very wide scope, inclusive provision the chief executive, ·who is the important matter of building a construc­ and exclusive. We also have the power Commander in Chief and treated really tive, positive foreign policy. to raise and support armies. We also as a part of the Army, was precluded Most of our time has been devoted to have the power to provide and maintain from obtaining sufficient, funds in ad­ a determination of what we are going to a navy, and we also have the power to vance to enable him to use the Army in fight witll, rather than what we are going provide for organizing, arming, and dis­ any way he desired. to fight for . . It seems to me that until ciplining the militia, and for governing Mr. MUNDT. The junior Senator and unless we determine what we are go­ such parts of it as may be employed in from Michigan has put his finger on a ing to fight for and what our outline of the service of the United States. While very pertinent point. Unquestionably foreign policy might :properly be, we can­ the President has a vast field of im­ that was one of the facts which moti­ not very well determine ·what is going to plied power, arising out of the fact that vated our constitutional father in estab­ be required to fight with. One precedes the Constitution makes him our Chief lishing that provision. the other and, once we have determined Executive and our Commander in Chief, Mr. MILLIKIN. Mr. President, will what we are going to hght for, we then the Congress also by the express terms the Senator further yield? come to the problem of how we are going and implication of the Constitution, Mr. MUNDT. I am happy to yield to to raise and equip the army, and of how which I have mentioned, is not without my distinguished colleague. it is to be commanded. armor in this debate or in action to be Mr. MILLIKIN. I take a rather lib­ Only the President, I submit, Mr. Pres­ proposed or·taken. eral view of the President's powers. I sident, has the power to put an end to Mr. MUNDT. I thank the Senator would not for a moment try to circum­ this debate. I think it could be argued very much for his contribution, and I scribe them. But, by the same token, rather persuasively from the President's think it should be clear to all students we are also entitled to a rather liberal point of view, as some of his friends are of the Constitution that the constitu­ view as to our express and implied powers endeavoring to argue, that the Com­ tional founders were much more meticu­ under the Constitution. I have made a mander in Chief under the Constitution lous and much more comprehensive in rather careful study of the Constitution of the United States has a considerable reposing in the Congress those specific and have found nothing in it which con­ degree of power to order the troops of controls we have in connection with the tains any prohibition against the use the country to serve where he thinks Army and our military forces than they of common sense or of constructive co­ their service is important and necessary. were in regard to the implications they operation between the so-called inde­ That constitutional reference or right made in the direction of the power of pendent branches of the Government. I has been argued almost since the be­ the Commander in Chief. thought it was a shocking and a very ginning of time. in the United States; Mr. WATKINS and Mr. FERGUSON foolish thing when the President said and some Presidents, having been a lit- . addressed the Chair. that he was willing to go to the people tle more high-handed and headstrong Mr. MUNDT. I yield first to the Sen­ on this issue. The issue went to the than others, have taken more advantage ator from Utah. people last November. But if he wishes of it than others. Some Presidents, Mr. WATKINS. I note the Senator it that way, he may go again to the peo­ more interested in national unity and said the Congress would have power to ple, but I think the result will be the considering the position of · Congress curtail these operations, by the control same, or even worse for him. I hope more adequately, have refrained from of the purse in providing for the Army, the President will come to realize that acting in any way that might be con­ Is it not a fact, however, that such con­ there is no prohibition against his acting strued as a defiance of Congress. trol means very little, if the President in honest cooperation with the Congress, ' I submit that it can also be argued goes ahead and orders our troops into so that we can work these things out very persuasively from the congressional situations in a manner which brings on without any conflict of constitutional point of view that the Constitution im­ a war? poses upon us, as a Congress, certain Mr. MUNDT. That certainly is true, jurisdiction, or assuming-- very significant controls as to where of course, because in such situations as Mr. MUNDT. The Senator is antici­ troops are to be sent and as to how they the one we have now in Korea, it is un­ pating precisely why I took the floor this are to be deployed, because we, and we thinkable that any Congress will refuse afternoon. That is exactly the thing I alone, are charged by the Constitution to· appropriate the money required to am recommending to the President, that with the right to raise and equip and complete the task in which we are en­ instead of taking this headstrong atti­ supply the military forces and to appro­ gaged and to protect our troops in the tude, this royal and superior attitude of priate the essential money. So if we have fighting theater. utterly defying the Congress, of register­ on the one hand a high-handed, head­ Mr. w ATKINS. In other words, if tng his contempt therefor and saying strong President, looking constantly for our troops are actually engaged in com­ that he will carry the issue to the people, increasing personal power and trying to bat, if our boys are on the battlefield there is a simple, respectable, logical, decrease steadily the importance of the fighting, or even our Navy and our Air and persuasive course he can take by em­ Congress, it is possible, of course, to Force, it is unlikely then that the Con­ ploying the rule of common sense and stymie and stalemate the entire foreign gress would reverse itself and try to con­ saying, "We are working together as a policy debate, while the constitutional trol the President in his actions by de­ Government comprised of coordinate question is argued till the cows come nying appropriations to furnish our branches, and the President and the home, or to the end of the congressional troops, our Air Force, and our Navy with Congress must move forward together, session. necessary equipment for the fighting, rather than fighting and quibbling about Mr. MILLIKIN. Mr. President, will and the additional troops to support constitutional powers." the Senator be good enough to yield? them in whatever action they are under­ Mr. FERGUSON. Mr. President, will Mr. MUNDT. I am happy to yield. taking or are compelled to undertake in the Senator yield? Mr. MILLIKIN. The Senator has al­ order to save their lives, and to save, so Mr. MUNDT. I yield. ready touched on it in part. The powers to speak, the face of the United States. Mr. F'ERGUSON. The Senator from of Congress are not limited to a single Mr. MUNDT. Under such conditions, Michigan did not have in mind that control over the subject matter. There I would say it is not only unlikely, but un­ Congress had the power to designate are four or five specific controls over our thinkable that Congress would take such where the Armed Forces would fight and military establishments provided by action. exactly when they would fight. Rather, the Constitution. One is the power to I now yield to the Senator from Michi­ in view of these provisions of the Con­ provide for the common defense. That gan. stitution relative to the limitation upon has no limits. It is our responsibility. Mr. FERGUSON. Is it not true that the term of appropriations for the mili­ It is our grant of unlimited power. the framers of the Constitution had in tary, he had· in mind that certain limi­ Mr. MUNDT. The Senator is exactly mind that both Houses of the Congress tations do exist in this field which apply cor.i-ect. were to have something to say about the to both the Congress and the Executive. 384 CONGRESSIONAL RECORD-SENATE JANUARY 17 As a result of those limitations the Presi- . is not· going to involve the United States ' subject, he could certainly go so far as dent and Congress, in eflect, would have and its troops in foreign actions abroad to say that, as a matter of policy if not to work as a team in using the Armed without conferring with Congress and of constitutional law, he would not move Forces of the Nation. · Such cooperation securing its prior consent; that before without the instructions of Congress. overcomes any-inherent danger of any making commitment to send American Mr. MUNDT. Precisely. That is the one man, connected with the military, troops to Europe to implement the Atlan- . point at issue today. as the President is by reason of his status tic .Pact or to patrol the boundaries of Mr. MILLIKIN. I voted for the North as Commander in Chief, obtaining from Europe he will seek and secure approval Atlantic Pact. the people large appropriations in order by Congress. Mr. MUNDT. So did I. that he might use the military in the Then there would be no cause for this Mr. MILLIKIN. I never would have future in any way he saw fit. constitutional debate, Mr. President. dreamed of voting for it had we not re­ By placing these ·provisions in the Then we can move forward as a team. ceived assurance that Congress would Constitution, ihe framers were remind­ Then we can move forward, each trust- _ retain control over the size and general ing the President and the Congress of ing the other. use of the forces. their accountability to the people of If, on the other pand, by the verdict Mr. MUNDT. We sought and received America in whom the sove:eign power to be recorded in the Senate next week clear-cut assurances then that we would actually resides. Neither the President the President's side wins--suppose that be consulted now. nor Congress has tlie right to take from by cracking the whiplash over the backs Mr. MILLIKIN. I think w~ should be the people the powers bestowed upon of Democratic Members he should have careful not to press the President to them in recognition of certain inalien­ enough votes to send the Wherry meas- wher.e he can rightfully take the position able rights. When both the Congress ure to the Committee on Foreign Rela- that "I, as the trustee of Presidential and the President recognize those rights tions, where it will be as dead as Ban- - powers, have no right to yield my own as the keystone of our liberties in Amer- · quo-is that going to satisfy the coun- powers, and you should not ask me to do ica, there will be no trouble between try? Is that going to satisfy those of us so, while at the same time asking that I Congress and the President. We will do who vote in opposition? Is that going respect your constitutional powers." But the things that are morally right for to allay any fear or dissipate any sus- if we limit it to the North Atlantic Pact the people of America and we will take picion? Or will it be simply a red warn- we are on sound ground, and he should the advice of the people in connection ing sign to the country that here is a · be the first to ·recognize it. with what the people think is actually · man who is determined to rule by Execu- Mr. MUNDT. That is correct. If he morally right. tive fiat, that here is a man who wants initiates that kind of move tQward na­ Mr. MUNDT. That is correct. I to defy Congress, who was able to Pi- tional harmony and unity and the r.esto­ rather think that if we could bring· out geonhole the resolution so that we can- ration of public confidence, it is much of the archives of the past, spokesmen not move forward, and so he can send better than beipg compelled to do it by from the days of the writing of the Con­ the boys now being recruited any place, some kind of congressional resolution. stitution they would be amazed and ap­ anywh2re, at any time, by Executive fiat, Mr. MILLIKIN. I believe the Senator palled to find this country, in this haz­ and with a royal wave of his hand? Is has made a very valuable contribution ardous time, concentrating on a debate that going to give us national unity? to the debate. as to whether the President or Congress I think not, Mr.· President. :Mr. MUNDT. I thank ·the ·Senator. alone is to have the ·control of the · Suppose, on the other hand, those of I conclude with the statement that under armies of the United States. I think,· us who support the resolution win; sup- present conditions the only court of by the very manner in which the framers pose we are able to influence enough sup- competent jurisdiction for rendering a of the Constitution . approached the . porters from the other side and among satisfactory and enduring verdict as to problem, they expected Congress and reluctant associates on our side, to win · whether or not the President's positlon the President to work, in the words of by a narrow margin. What does that with regard to troops and their move­ the junior Senator from Michigan, as a accomplish? Where does that leave us · ment is correct, or whether the congres­ team. Certainly I see no basis for the in the public viewpoint? We have the sional position is correct, is the court White Fouse and the State Department satisfaction, I suppose, of defeating the · of public opinion. That court does not calling upon the Nation for unity and President in a proposal which he should . convene until November 1952. In the upon Congress for cooperation, in one never have made. We have cautioned meantime we have conditions to meet breath, if, in the next breath, the Presi- · him that the Congress is still on the and we have problems to solve. we dent at a press conference says, "We job, and even more on the job than it should be debating in all sincerity the propose to defy Congress. We :1ave the was 2 years ago at this time. But I think formulation and proclamation of a for­ power to send troops anywhere we want that is not a very happy answer, either, eign policy which our fellow citizens and to, and at any time, and we are going to because we do not know whether he is our friends abroad can understand. exercise that power. If Congress tries to going to follow that resolution. Suppose Certainly we have no such policy as of exercise any power to the contrary I will he should ignore it? Then what would today. We have no such proclamation. carry the issue to the country." happen? I venture .to say that no Senator could I think that would be an amazing Does anyone think the Congress of the stand on the floor of the Senate and ex­ spectacle to the men who wrote the Con­ United States is going to impeach the plain in a 1-minute speech or in .a 10- stitution. President while Congress is comprised of hour speech what our American foreign If the President proposes to adhere to a majority of his own party members? policy is toward Asia. We do not have that viewpoint, we can continue such a If we should, would that strengthen us any policy toward over half the people debate throughout the session of the in the eyes of foreign nations? I think in the world. We have a day-to-day, Congress. We in Congress have certain not. catch-as-catch-can series of frightened inalienable rights, and we would be dere­ Mr. MILLIKIN. Mr. President, will and frightening reactions to something lict in our responsibility to the people the Senator yield? that the Russians are saying or that the who sent us here unless we maintain Mr. MUNDT. I yield. Russians are doing. What the world control over the purse strings and un­ Mr. MILLIKIN. I should like to sug- needs and what America needs is a clear less we maintain the right to declare gest that I think the President will be American foreign policy, brought about war, and the right we possess in con­ duty bound to maintain his own consti- by a meeting of minds in honest debate, nection with the recruiting and supply­ tutional powers and. that he would not, which foreign policy, when it is pro­ ing of troops. and I think he should not, make any kind claimed, will be as easily understood as So I suggest an easy answer to the of a statement that would perp.etually the Monroe Doctrine was understood in predicament in which we find ourselves. limit his own constitutional powers. its day, It should be as clear, precise, I propose that President Truman, be­ But he certainly could say that so far cogent, positive, and courageous. We tween now and the time we intend to as implementation of the North Atlantic should have such a foreign policy, tn­ vote upon this issue next week, proclaim Pact is concerned, in connection with stead of continually and perpetually be-. to the country that the constitutional which we were told, in debate, that there ing bound by the kind of policy we have debate is over, that he, as the President, would be congressional control over the to~ay, which is little more than a series 1951 CONGRESSIONAL -RECORD-HOUSE 385 of belated reactions to something which ter is clear in its statements, because the Kremlin initiates, what Pravda or it is cogent, because it is analytical, HOUSE OF REPRESENTATIVES Izvestia says, or what the Communist because it is objective, because it is ex- · conspirators and transgressors do or say. actly in line with the remarks just made WEDNESDAY, JANUARY 17, 1951 Certainly somewhere in the world by the senior Senator from South Da­ The House met at 12 o'clock noon. there is an American position. We ought kota [Mr. MUNDT], and because it brings · · The Chaplain, Rev. Bernard Bras­ to be able to arrive at an American for­ back to our minds the necessity of re­ kamp, D. D., offered the fallowing eign policy. As Americans we have re- . verting to history and to the precepts prayer: sponsibilities. We have a responsibility of others in days gone by, I desire to in this world as Americans, as members read the letter into the Record at this 0 Thou God of infinite love and mercy, of a global community, and as believers : time: who art always seeking to guide and in freedom, which we should be willing PORTLAND, OREG., direct us into the nobler ways of life, to develop, and to the development of December 13, 1950. help us to interpret all Thy righteous which we should be willing to devote our The Honorable GUY CORDON, commands and judgments as gracious time and talents, free from the contro­ Senator ftom Oregon, Senate Office invitations to follow the paths which Building, Washington, D. C. Thou hast marked out for us. versy of whether the President of the DEAR SENATOR CORDON: It is frequently United States can get by with defying stated that our Senators and Representatives Grant that we may see more clearly Congress, or whether Congress, on the in Congress welcome individual views of that Thou art not commanding or ex­ other hand, can get by with defying the the citizenry. With this in mind, I take pecting our finite minds to comprehend President through its hold on the purse the liberty of writing you about the serious fully Thy divine will and Thy dealings strings. dilemma facing our Nation. with us, but that Thou art calling us to If the President will speak out and re­ The first half of this twentieth century pre­ trust and obey Thee faithfully. move the problem from present consid­ sents a strange contrast. It witnessed great We pray that Thou wilt help us to attainments by the United States in ma­ understand that the measure of our eration by making a plain and definite terial well-being and also in that spiritual declaration that he will not move into stature which overcomes racial hatreds, and faith and obedience is the measure of this Atlantic community with any pro­ gives succor to the oppressed and respect our wisdom and strength and peace. posal with respect to American troops to the minority. Inspire us daily with a larger faith and without consultation with Congress in But on a global scale, the half century a deepening assurance that there is no advance, and without first securing ap­ has been one of the most violent and de­ crisis which we cannot face, and· no proval of Congress for his actions, we structive in the hist0ry of man. Our Nation hardship which we cannot endure when can devote ourselves to these tremendous became engulfed in two world wars, and our minds an<;l hearts are stayed on Thee and urgent problems of writing, prepar­ on bot1'. occasions emerged victorious but and when we place our hands in Thine. ing, developing, and supporting a foreign lacked the statecraft to win the peace. · In Christ's name we bring our peti­ We are now being drawn into another tions. Amen. policy which the world, the people at vortex of global violence. Our competent home, and the boys :fighting in Korea generals have in recent weeks been assigned The Journal of the proceedings of can understand. well-nigh impossible tasks; and our gaIJant Monday, Janul'l,ry 15, 1951, was read and Then we can start talking about how troops have ridden into the Valley of Death, approved. to raise an army, at what age boys shall as did the Light Brigade at Balaklava, be­ be called up for service, under what cause "someone has blundered". COMMITTEE ON VETERANS' AFFAIRS methods they are to be called up, how There is talk of bipartisan policy or the Mr. RANKIN. Mr. Speaker, I ask· lack of it. Let me pose a simile. A ship to train them, where to send them, and is steered fly its captain, upon whose com­ unanimous consent that as chairman of how to equip them. Then we can start petency rests the fate of passengers and the Committee on Veterans' Affairs I may talking about the problem of :financing crew. But the captain does not guess at have until 12 o'clock tonight to file a re­ our effort, how to get the money, and the stars nor make emotional judgments port on the bill H. R. 1. how to raise the taxes. Then we can on navigation. He must operate on proven The SPEAKER. Is there objection to start talking about the immediately im­ principles. the request of the gentleman from Mis­ portant problems of how to mobilize our In our American captaincy on foreign sissippi? economy, and how to get ready. That seas there are two outstanding and historic There was no objection. principles of navigation in United States is what we should be doing, instead of statecraft. These were set down and proven AMENDING CHAPTER 26 OF THE INTERNAL constantly acting as though the Presi­ by George Washington and Theodore Roose­ REVENUE CODE dent were waging war on Congress, or velt. Sound and solid today as when origi­ Congress waging war on the President. nated, they are: Mr. DOUGHTON. Mr. Speaker, I ask It is a situation for which the President 1. Avoid foreign entanglements. unanimous consent for the present con­ must assume full responsibility, having 2. Speak softly and carry a big stick. sideration of the joint resolution (H. J. told the country, "I will defy the Con­ There is plenty of latitude in these pre- Res. 73) amending chapter 26 of the In­ gress, if need be, and send troops to any cepts to cover the cha·nges of time and his­ ternal Revenue Code. place at any time I choose." Having de­ tory and -to meet new responsibilities. The Clerk read the title of the joint Washington's precept does not adjure resolution. clared this forensic war, he is the man against foreign dealings or interests, but to call it off. We would then be able to against entanglement. Theodore Roosevelt The SPEAKER. Is there objection to settle down to a consideration of much believed in a strong voice in international the request of the gentleman from North more urgent business if the President affairs, but he adjured against a loud mouth Carolina? were to make the declaration I suggest. and too little power. Mr. MARTIN of Massachusetts. Re­ Then the public would have confidence These precepts remain the wise formula serving the right to object, Mr. Speaker, that we are moving -forward as a team, upon which our Nation achieved its sound I do not like to have all this legislation and that we are moving forward as a position in the world. coming up by unanimous consent, partic­ government of coordinate branches, in­ As a citizen of Oregon, I urge you to do ularly when there has been no oppor­ your utmost to reestablish these proven prin­ tunity to consider these measures. stead of competitive branches. Were we ciples as a guide to our bewildered state­ to do so, certainly we would present a craft, to the end that America may again Therefore, it not having been brought to stronger front to the enemies of free­ earn the admiration of the world. my attention that unanimous consent dom, regardless of what foreign policy Respectfully yours,, would be asked today to bring up this we eventually decided upon. JAMES T. WYATT. bill, I shall be obliged to object, until that rule has been complied with. PRECEPTS OF OTHER DAYS AS A GUIDE RECESS Mr. DOUGHTON. This bill has the FOR ACTION-LETTER FROM JAMES T. Mr. JOHNSON of Texas. I move that support of all the departments con­ WYATT the Senate stand in recess until 12 cerned. It has the unanimous approval Mr. CORDON. Mr. President, under o'clock noon tomorrow. of our committee. date of December 13, 1950, I received a · The motion was agreed to; and