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Commerce Department officials, in appraising the price situation, expect price drops by next fall on a number of items that, in the Department's opinion, have advanced too much. It believes foods, cotton goods, shoes, lumber, paint, drugs, leather, fats, and oils are in line for substantial corrections. It is understood that the Department also expects smaller declines for automobiles, consumer durable goods in general, woolens and worsteds, furniture and house furnishings, iron and steel products, paper, pulp, grains, and livestock.

Some economists believe that as far as retail prices are concerned the best hope is that they will come to rest 20 to 30 percent higher than what used to be considered "normal."

We are still in a pronounced seller's market in most commodity categories, especially consumer durable goods. Prices continue high and deliveries are, in most cases, long delayed. Our purchasing policy has been on a hand-to-mouth basis for most commodities excessively priced, and, on a number of occasions, we have rejected bids because of excessive prices, or because of absence of a firm price that is reasonable under present market conditions. No volume purchases are being made on the current chaotic market. We are not only price conscious but also quality conscious. Typical of this policy is the office circular issued by the purchasing officer to all departments in the matter of procurement of lumber. Lumber prices are fantastically high, and no doubt some buyers are responsible for this price strength. Prices today on some plywoods are three times as high as the prices were under OPA controls. Most seasoned hardwoods are at a premium and are very scarce. We agree with the monthly letter of the National City Bank of New York, which advocates :

The remedy for price increases that threaten stability is to buy less, not to do things that will push them up further.

Here is the circular, No. 959, that was issued on March 14, 1947. would like to submit that for the record. (The circular is as follows:) GOVERNMENT OF THE DISTRICT OF COLUMBIA,


March 14, 1947. CIRCULAR No. 939 Subject: Purchase of lumber. To Heads of Departments:

Lumber prices are fantastically high, and no improvement in the present situation is indicated in the near future. Some buyers are partially responsible for this situation, as payment of premium prices strengthens the market and keeps prices high. Some plywoods, for example, are selling for three times the price under OPA.

We suggest a studied buying policy. Only purchases on a "hand-to-mouth" basis to meet important needs, which can be justified, should be considered for the time being. This applies to all purchases of lumber, whether coming under the heading of purchases under $100 or otherwise.


Purchasing Officer, District of Columbia. Mr. BRENNAN. I am prepared to furnish any additional details the committee would like to have as to the various commodities the District buys.

Senator Cain. That is a very worth-while statement, Mr. Brennan, and let me ask: Do I understand correctly that the statute under which you are able to operate limits the personnel you can employ?

Mr. BRENNAN. No; it does not.

Senator Cain. I just misunderstood and I wanted to get that straight.

Outside of your purchasing problem, which confronts all of us in America, you have no difficult problems at the moment? Your appropriations, requested, which are generally larger than they were a year ago, and only for the reason of these pay increases, is your only problem?

Mr. BRENNAN. Well, I do have one problem. It deals with a matter that the committee probably cannot help on. It has to do with certain reallocations.

I have a new technical assistant who, before he came with us, was making around $7,000 a year. He was with a large manufacturer, and being a new man he was released. He took this position in my office and is doing remarkably well.

His classification is CAF-9. I do not know how much longer I will be able to keep him. I did ask for a higher salary, but I was denied it by the Civil Service Commission.

Senator Cain. We have no way of helping there. Mr. BRENNAN. That is the only thing troubling me today. I would like to keep this man.

Senator Cain. I might ask a question there for a point of information. This man works for you?

Mr. BRENNAN. He is the technical assistant.
Senator Cain. Technical assistant to you?
Mr. BRENNAN. Yes, sir.
Senator Cain. He is your employee?
Mr. BRENNAN. Yes, sir.

Senator Cain. How does it happen, therefore, that your Commissioners, if they saw fit, could not approve that?

Mr. BRENNĂN. The Commissioners did approve.
Senator Cain. And then where does it go from the Commissioners!
Mr. BRENNAN. To the Civil Service Commission.

Senator Cain. I presume the reason for that is that this man fills a certain designation. You give him a number?

Mr. BRENNAN. Technical assistant, CAF-9.

Senator CAIN. And technical assistants, under the Civil Service, are paid a salary from a minimum to a maximum, and the figure you have requested is in excess of that maximum ?

Mr. Brennan. I had asked for a lifting of the grade CAF-9 to P-4, which would put him in the next salary range.

Senator Cain. Well, I still do not quite understand that. You do not, therefore, appear to have sufficient jurisdiction to determine what you want your employees to become.

Mr. BRENNAN. Well, under the operation of the Classification Act, you file a form and describe the duties of the position and give the present classification and the recommended classification with justification therefore. Hearings are held by the District Personnel Board, and then the papers are transmitted through the Commissioners to the United States Civil Service Commission.


Senator Cain. And their determination was that the job did not justify the classification request !

Mr. BRENNAN. Yes; after investigation by one of their investigators.

Senator Cain. Yes; well, I would have no comment to make in response to that, for that is not my responsibility.

Mr. BRENNAN. Well, that is what I said.
Senator CAIN. Yes.
Mr. Jackson, do you care to ask any questions?
Mr. Booch, representing Mr. Horan on the appropriations side?
No questions?
Thank you very much.
Mr. BRENNAN. Thank you, sir.

Senator Cain. It now appears our hour of adjournment, within a minute, anyway.

I am hopeful that Mr. Bates will be back tomorrow morning, for many reasons, only one of which is his desire to listen to the problems of the school system of the District.

Commissioner Mason. I was going to ask, Mr. Chairman, do you want to start with the schools in the morning or the Engineering Department?

Senator Cain. I think it would be a favor to Mr. Bates were we to be able to start with the schools.

Commissioner Mason. With the schools.

Senator Cain. And I should be delighted to apologize to the Engineers for a seeming discourtesy which was not intended. We had hoped to get to them today, but I think all of us recognize their testimoney is likely to take some time.

Commissioner Mason. They are all battle soldiers, and they take that in stride.

Senator Cain. Thank you.

If there are no comments from those in the chamber, we will stand adjourned until 10 o'clock tomorrow morning.

(Thereupon, at 11:45 a. m., an adjournment was taken until 10 a. m., Wednesday, March 26, 1947.)

(Statement later received for the record from the Purchasing Division.)

Purchasing Division

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1939: A decrease of one employee is occasioned by transfer of a position, CAF-3, multilith operator and cameraman, to the Division of Printing and Publications.

1943: An increase of two employees is accounted for by the addition of one CAF-3, requisition checker, and one CAF-2, purchase-oriler writer.

1944: A decrease of one employee is occasioned by reduction of the number of employees, CAF-2, operatiog the purchase-record desk from two employees to one employee.

1946: A decrease of one employee is occasioned by transfer of a position, CAF-9, Chief, Division of Printing and Publications, to the Executive Office.

In increase of two employees is occasioned by the addition of one position, CAF-7, liaison officer, Surplus War Property, and one position, CAF-2, purchase. order writer.







Washington. D. C. The joint subcommittee met at 10:05 a. m., pursuant to adjournment, in the Senate District Committee Room, the Capitol, Washington, D. C., Senator Harry P. Cain (chairman of the joint subcommittee) presiding.

Present: Senator Cain, Representatives Bates (cochairman of the joint subcommittee), and Klein.

Present also: Parker L. Jackson, Special Adviser to the House Committee on the District of Columbia.

Senator Caix. Come to order, please, gentlemen.

Mr. Bates has returned to act as cochairman with me, representing the House, on their fiscal subcommittee of the District Committee.

We are privileged to have with us this morning, Mr. Walt Horan, who is chairman of the Fiscal Subcommittee of the District of Columbia Appropriations Committee of the House. He, through Mr. Booch, has been cooperating since the hearings began, for Mr. Booch has been with us every day, and we are delighted to have Mr. Horan this morning, and I think, Walt, you would like to make some comments prior to the time we begin.

Mr. HORAN. Yes, I would.

Senator Cain. Would you be kind enough to come over and sit on this side of the table so that you may be seen by those who are here.




Mr. Horan. Mr. Chairman, I have naturally been following your proceedings over here with a great deal of interest. I am very proud of the Nation's capital and want it adequately treated.

I said in a news release last Sunday that I felt that a Federal budget of $100,000,000 or $200,000,000 for the Nation's capital running expenses was not out of order.

I see here a statement on school teachers' salaries which, I think, are subject to adjustment.

I have to drive through the District on my way to the Capitol every morning and I know that Engineer Commissioner Gordon Young's plans for the District have a good deal of merit in them.


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