The CHAIRMAN. Have you talked to Mr. Courtney about the bill? Mr. BLOCHER. No, sir.

The CHAIRMAN. Have you seen the last three bills that were introduced?

Mr. Blocher. Yes, sir. The CHAIRMAN. When did you see them? Mr. BLOCHER. Yesterday. The CHAIRMAN. Have you read them carefully? Mr. BLOCHER. Yes, sir. The CHAIRMAN. That is all. Have you any questions, Mr. Lipscomb?

Mr. LIPSCOMB. I believe the three questions Mr. Osmers is asking are incorporated in 9890; isn't that right?

The CHAIRMAN. That is right.

Mr. OSMERS. The critical question, the most important one of the three questions is the one concerning the place in the Government where business may take its case. Mr. Blocher by endorsing 8832 must have discussed in good detail with his organization one of the three questions, which is that dealing with the place in the executive establishment where business and industry may take their complaints.

Mr. BLOCHER. I would like to make one statement. We have in our business some connection with Joint Committee on Printing, since some of our members are in the printing business as well as the blueprinting business, and we have had some experience and know that that type of place to report is very helpful to our industry. They have helped us to some degree.

The CHAIRMAN. Your organization has advocated a reduction in taxes; have you not?

Mr. BLOCHER. Yes, sir.
The CHAIRMAN. And in Federal activities; have you not?
Mr. BLOCHER. Yes, sir.

The CHAIRMAN. You want a simplification as much as you can get it; do you not?

Mr. BLOCHER. That is correct.
The CHAIRMAN. All right. That is all. The next witness,
Mr. WARD. Mr. Seegmiller.

Mr. OSMERS. Mr. Chairman, before we have the next witness, there is a telegram and a couple of statements that I would like to ask leave to put in the record.

The CHAIRMAN. Surely.

Mr. OSMERS. One is from W. C. Birthright, general president of the Journeyman Barbers and Hairdressers International Union. He says:

The Journeyman Barbers and Hairdressers International Union representing 80 percent of the trade urges you to report H. R. 8832 favorably. PX barber shops offer unfair competition in many places. H. R. 8832 would create the medium that could correct a grave injustice.

The CHAIRMAN. I have a number of those which came in, I believe, a year or more ago from the Southwest and down in Alabama, where they have a PX competing with these people--not only the barbers, but novelty people and everybody else.

Mr. Osmers. That is one from the general president of the Journeyman Barbers and Hairdressers International Union. I would suggest that we put that one in.

I have another telegram from Mr. L. M. Raftery, general president of the Brotherhood of Painters, Decorators, and Paperhangers of America, wherein he says:

I have your wire expressing desire that our organization testify Friday, July 16, 10 a. m., at hearing, room 1501, New House Office Building, on H. R. 8832, Anti-Government Competition Act. Regret that press of business in connection with our brotherhood's approaching national convention and other matters makes it impossible for me to be in Washington on July 16. As your wire indicates, large number of witnesses will submit testimony. Sincerely trust representative presentation on questions affected by H. R. 8832.

I have a letter from the Marking Device Association addressed to the chairman, and another statement from the Metal Treating Institute.

Also a statement here, Mr. Chairman, that I would like to ask unanimous consent that it be made a part of the record, which is a statement from Congressman Stauffer, of Pennsylvania.

The CHAIRMAN. Without objection, it will be made a part of the record and filed. (The documents referred to are as follows:)


Evanston, Ill., July 14, 1954. Hon. CLARE E. HOFFMAN, Chairman, Government Operations Committee,

House of Representatives, Washington 25, D. C. DEAR MR. HOFFMAN: In response to your telegram, I am glad to give you a statement regarding Government competition in the marking device field.

It is impossible, in the short space of time allocated, to provide you with complete documentation, but I assure you we have such in our files and I am enclosing a few representative ones.

Ours is a small industry, but it's an important industry and has been declared essential to 2 wars and 1 police action. Marking and identification has been recognized by all branches of the Government as being necessary for proper distribution of ordnance. The problem then becomes one of whether or not our industry can provide proper service, or whether it is necessary for the Government to go into the business of making rubber stamps and rubber printing plates in order to provide some service which we cannot offer. In every case where we have had an opportunity to investigate Government facilities manufacturing rubber stamps or rubber printing plates, we have never been able to find any justification for the Government being in business. The stories, that it is neces. sary to provide service and quick action which our industry cannot furnish, are completely without foundation and have been so proven whenever we have had a chance.

We have in our files a number of copies of various requests for materials and supplies for federally owned and federally operated facilities for the manufacture of rubber stamps, printing plates, or other marking devices. This list includes the United States Department of Agriculture Soil Conservation Service in Indianapolis, Ind.; United States Naval Missile Test Center, Point Mugu, Calif.; National Fireworks Ordnance Corp., Shoemaker, Ark.; Procter & Gamble Defense Corp.; Milan Arsenal, Milan, Tenn.; and many others. Those mentioned are just a few of the requests received thus far this year.

We also call your attention to the Government printing and binding regulations, published by the Joint Committee on Printing of the Congress of the United States, No. 6, dated July 1, 1953. Calling your special attention to page 3, authorizing the manufacture of rubber stamps or rubber printing plates under the class B printing plants. These particular plants represent the most outstanding instances in which the Government has undertaken the manufacture of products formerly produced by the marking-device industry,

On page 22 of the same pamphlet you will find a list of the class “B” printing plants which would ordinarily purchase their materials for marking from the small businesses which our industry represents. The great majority of these Air Force bases listed on page 22 are near some town which has a rubber-stamp plant. There is no obvious reason why these Air Force installations should not patronize these industries closest to their location if they wish effective and fast service.

We are also submitting a copy of a letter from the Assistant Secretary of Defense, signed by C. F. Thomas to Senator Saltonstall, containing what we believe to be misleading and incorrect statements. An appropriate refutation is attached thereto. In essence, this letter by Mr. Thomas indicates that the necessity for speed in the use of rubber printing plates prohibits private enterprise from manufacturing the necessary item. This we cannot see to be true, however, because the markings on all Government boxes need blueprint specifications prior to the manufacturing of the printing plates. These blueprints are usually made some weeks or months in advance of the actual packaging and shipping of the particular supplies in question. If all of the offices involved were operating efficiently, then there should be ample time to distribute these blueprints to the manufacturers of rubber printing plates outside the Government offices.

An underlying assumption seems to be that because the Government has authorized numerous printing plants at various Air Force bases and defense departments throughout the United States, the establishment of the same, therefore, is above question.

It is because of this philosophy that we desire to strike at the heart of the Government performing industrial services.

We call your attention, too, to the Department of Commerce pamphlet MC39C, covering the 1947 census of manufacturers. What is shown is the total number plants, personnel, volume of business, etc., as of 1947.

We conduct a survey of our industry and, projecting this monthly survey on a yearly basis, we believe we have about a $50 million industry, of which probably $30 million represents rubber stamps.

We also present a brochure of our industry which clearly shows all of the various products and services offered in peace and war. This gives only an indication of the immensity and complexity of the fields covered by skilled and experienced personnel in our industry.

We also offer our 1954 membership roster of the association which gives you the names and location of various members who comprise at least 90 percent of our total industry, both manpower and dollars and cents volume. You will find here ample distribution of facilities throughout the country. We are also enclosing a resolution, which has been adopted by the Marking Device Association at their various district meetings throughout the year, decrying the present state of conditions brought about by Government entry into our industrial field.

In 1952, we had the privilege of appearing before the subcommittee of the Committee on Expenditures in the Executive Department of the House of Representatives, meeting in St. Louis, Mo. This, at that time, was called the Bonner committee.

We would refer you to this report wherein we have given a complete and documented story of Government competition with our own facilities at that particular time. Our report starts on page 157 and continues to page 191.

We believe that our industry is capable of maintaining fast and efficient service to all the armed services and Federal agencies desirous of obtaining rubber stamps or other marking devices. The unnecessary duplication of operations by Government agencies, given evidence hereto, is wasteful activity from the point of view of both equipment and manpower. It deprives the Government of exper enced industrial services given by our industry which possesses the knowledge to manufacture better quality items less expensively. Furthermore, we ask why is it necessary to invade the premises of this scope of small business to deprive these skilled workers of their livelihood, and also use these same taxpayers' money to set up plants in competition with them?

We hope that we have given you sufficient information to enable you to take proper action upon the Anti-Government Competition Act now before the House of Representatives.

We appreciate your consideration and assure you of our desire to cooperate at all times. Sincerely yours,

John SCHWEIZER, Chairman, Committee on Government Competition.

Elmer F. WAY, Secretary and General Manager, Marking Device Association.


FROM THE STATE OF PENNSYLVANIA Mr. Chairman, I appreciate very much this opportunity to present a statement to this committee on H. R. 8832 known as the Anti-Government Competition Act.

Government competition with private enterprise is contrary to every concept of our free-enterprise system and cannot be justified in any way, except in rare cases of national emergency or unavailability of products from private enterprise. It is particularly harmful to small business and it is in this connection that I wish to call the attention of the committee a situation in my own district.

Piezo electric quartz crystals are used in the field of communications, electric counters and calculators, tiuring devices and so forth, and are very necessary in this field. In times of rational emergency or war large quantities of these crystals are used by the Armed Forces. The manufacture of Piezo electric quartz crystals in this country originated in my aistrict at Carlisle, Pa. Over a period of years the companies engaged in this business have built up their plants and developed special equipment used in the manufacturing process. Due to a scarcity of crystals in the Second World War, the Government purchased equipment from these manufacturers for use by the Armed Forces for their own manufacturing operations.

Ás is usual in the case of Government competition with private enterprise, the practice of manufacturing crystals has been continued by certain branches of the Armed Forces. In addition, the Government either loaned or financed equipment for a number of companies which came into the field during World War II, and these companies have continued their operations.

Following the war, the demand for crystals dropped off materially and today, the old-line companies are suffering from Government competition and from the competition of manufacturers financed by the Government. The companies in my district may be forced to close their operations which, in my opinion, is contrary to the best interests of the country and our whole defense setup.

I am sure there are other instances which duplicate the experience the crystal manufacturers at Carlisle, Pa., but to relate them would only add to a record already filled with such incidents.

I was very glad to learn that your committee had taken this matter under consideration and that a bill had been prepared to at least make a start in removing this threat to our private-enterprise system. I heartily endorse H. R. 8832.



Mr. SEEGMILLER. Mr. Chairman, the events of the last few days have prevented me from preparing a statement. I would like to make a 3-minute oral summary, with your permission, and file a statement next week.

The CHAIRMAN. You do not need to. You tell us about it today and we will not be waiting for it.

Mr. SEEGMILLER. In very summary fashion I would like to tell

you then

The CHAIRMAN. What I am trying to get at is, I do not want to duplicate your statement.

Mr. SEEGMILLER. No, there will not be any duplication.

I am Keith L. Seegmiller, executive secretary of the National Association of County Officials. Our association is made up mostly of county commissioners and supervisors of the Nation's 3,050 counties.

We are interested in the phase of these bills before the committee that has to do with tax exemption on Federal property.

H. R. 8832 contains a sentence that summarizes our interest very well. It says that it further deprives the people of the opportunities for private employment and enterprise and thereby reduces the ability to pay taxes, without which the Government cannot exist. This is one phase of the broader problem of Federal tax exemption on its property.

The tax-exempt status of Federal property, of course, we have always had with us, and for a good many hundreds of years or more it did not impose much of a burden on the State and local governments. However, the increasing acquisitions of property by the Federal Government during the past score of years primarily has made this burden very substantial and increasingly acute until those of us in our association along with a good many other representatives of local government have been complaining bitterly about it for at least a decade.

Our principal objective has been to get payments in lieu of taxes on federally owned property. But an accompanying objective has been to get the Federal Government out of the ownership of property which we think is excess for Federal purposes.

I take it that is the matter before this committee this morning primarily, as far as we are concerned.

We do feel a lot of business property owned by the Federal Government, and a lot of personal property as well as real property should be subjected to taxation, since it demands the same protection from our county court houses by way of police protection, and fire protection, and school services for children of the people who work in the plants, as any other private property. We have a good many illustrations we can cite, but I will not be specific on that.

Just a typical one is that of a big plant in which there is both personal and real property which brings into the jurisdiction a few thousand extra people. It crowds the schools and crowds the highways and makes extra demands on our police and health services, and still pays no extra taxes.

We are careful to qualify our statements by saying that we have no interest at all in circumscribing the legitimate functions of the Federal Government. We know the Federal Government must own property, and we know it has important functions to perform. We would be the last in the county courthouses to suggest that the Federal Government cease property ownership in any way that would substantially curtail its legitimate and proper functions. But I believe we would like to be among the first to say that in many instances the Federal ownership has gone beyond that necessary for legitimate Federal functions, and in those instances we would like to see the Federal ownership removed and get the property back on the tax rolls.

With that much of a brief statement I would like to say that we endorse the objectives of these bills before the committee this morning. I have not examined them enough to endorse specifically any particular one, but the objectives we do endorse.

I would like to go on record with that much, if you please, Mr. Chairman. I have nothing further to say here.

The CHAIRMAN. Mr. Osmers.

Mr. OSMERS. Mr. Seegmiller, the Federal Government owns an amazingly high percentage of the land in the country, and I suppose it falls into 3 or 4 different categories, It falls into military installations, national parks and forests, Federal office buildings, and so on. Then it also gets into that quasi-private field where they have either built or leased buildings which are operated by private business for the manufacture of some item that is used by the Government.

For example, in my own congressional district the Navy Department came along on the Hudson River with an invaluable piece of waterfront

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