Mr. KEATING. Good.

Mr. WALDEN. In this connection and at this juncture, I wish to introduce into the record and read part of a letter from Bernard L. Orell, Director of the Forest Products Division to Mr. C. T. Gray, president of Stockton Box Co., Inc., and I will show you this letter after I read this. I don't really have to show it to you because this confirms your statement.

Your Point 3, "Government Operation of Sawmills and Box Factories," is something that the Forest Products Division is already working on. The Business and Defense Services Administration has already received the assurance of the Defense Department of sitting down with us and looking this matter over carefully so that they can get out of facets of business without hampering their activities. There is a valid reason in some instances, but no attempt has been made to justify their participation in the lumbering business.

Does this confirm your statement that one of the efforts of the Forest Products Division was to get the Government to get out of this activity?

Mr. HONEYWELL. That is correct.

Mr. WALDEN. Let me show you this letter.

This is a letter dated November 6, 1953, from George M. Fuller, vice president of the National Lumber Manufacturers Association, to Mr. James M. Owens, Assistant Director, Lumber and Wood Products, Forest Products Division, BDSA, which reads as follows: Was Mr. Owens Assistant Director of Lumber and Wood Products, Forest Products Division?

Mr. HONEYWELL. Yes.

Mr. WALDEN. Whether he received this letter or not you cannot testify.

DEAR JIM: The attached copies of correspondence are self-explanatory, and in response to your request that we get some bidders for timber and logs at Eglin Field so the Air Force will not be able to use a lack of bidders as an excuse for not abolishing their sawmill operation at that base. Best regards

And then it is signed. Is one of the activities of BDSA in getting the Government out of the sawmill business to urge upon the trade associations that they get bidders for these logs so the Government would have no excuse for staying in the operation?

Mr. HONEYWELL. I think that would be very appropriate action. Mr. WALDEN. On the part of BDSA?

Mr. HONEYWELL. On the part of BDSA.

Mr. WALDEN. Would you give me back my document, please?

Mr. HONEYWELL. Sure. May I call your attention to the fact that Mr. Owens is a career employee of BDSÅ?

Mr. KEATING. It is the policy of the Department of Commerce and of this administration where possible to get the Government out of competition with private business; isn't it?

Mr. HONEYWELL. Yes, sir.

The CHAIRMAN. Nobody is making a criticism of that.

Mr. KEATING. Then why are we having all this shouting?

The CHAIRMAN. We are trying to find out the purposes of this organization.

Mr. FINE. We want to know who profited from this conduct, whether these WOC's profited.

Mr. WALDEN. In order to get the Government out of business, BDSA or its representatives would recommend to the trade associations that they get bidders for these logs so the Government would have 110 excuse to stay in business.

Mr. HONEYWELL. That is right.

Mr. WALDEN. I will introduce this into the record together with some attachments indicating the companies to which one of the members wrote on behalf of the trade association and indicating their activities. I will read part of a letter to Mr. George Fuller, National Lumber Manufacturers Association, October 29, 1953, from the AlgerSullivan Lumber Co., and it says:

Following our telephone talk of October 27 about the Eglin Base, we contacted 4 of our friends in this area and, with their help, we have gotten approximately 20 names of operators that should be interested in bidding on logs and on timber either on the reservation or at Eglin Base gates. We are writing all of these people and enclosing with the letter a memorandum as per attached copy.

The folks that we have discussed this with will write the commanding officer, sending a copy to you, and of course, a number of them will naturally contact Representative Sikes and Senator Smathers.

We are reasonably certain that you will get enough action on this so that the commanding officer cannot say that there are not people in this area interested in bidding on logs. If there is anything further we can do, we will be pleased to hear from you.

The CHAIRMAN. That will be received in the record with the attachments.

(The document referred to is as follows:)

Mr. JAMES M. OWENS,

NOVEMBER 6, 1953.

Assistant Director, Lumber and Wood Products, Forest Products Division, Business and Defense Services Administration, Department of Commerce, Washington, D. C.

DEAR JIM: The attached copies of correspondence are self-explanatory, and in response to your request that we get some bidders for timber and logs at Eglin Field so the Air Force will not be able to use a lack of bidders as an excuse for not abolishing their sawmill operation at that base.

DEAR MR. FULLER: Following our telephone talk of October 27 about the Eglin Base, we contacted 4 of our friends in this area and, with their help, we have gotten approximately 20 names of operators that should be interested in bidding on logs and/or timber either on the reservation or at Eglin Base gates. We are writing all of these people and enclosing with the letter a memorandum as per attached copy.

The folks that we have discussed this with will write the commanding officer, sending a copy to you, and, of course, a number of them will naturally contact Representative Sikes and Senator Smathers.

We are reasonably certain that you will get enough action on this so that the commanding officer cannot say that there are not people in this area interested in bidding on logs. If there is anything further we can do, we will be pleased to hear from you.

Yours very truly,

L. F. NELSON, Sales Agent.

OCTOBER 28, 1953.

COMMANDING OFFICER,

United States Air Force Proving Grounds,

Eglin Field, Fla.

DEAR SIR: We understand from late news release that there may soon be released for sale stumpage and/or logs from the Eglin Field area under your jurisdiction.

We would be pleased to learn of such a decision as we would be interested in making bids on any timber you would have to offer from time to time. If and when this is effected, please put our name on your mailing list.

Our mill operates at Milton, Fla., and because of large landowners, the United States Air Force and Navy training areas held from the market, the supply of logs is insufficient to operate economically. Although we could not hope to be the successful bidder at each letting it would enable us at times, or other sawmill operators to provide greater employment in these west Florida counties. Trusting favorable action will be taken in this matter and awaiting further news releases, we are,

Yours very truly,

SANTA ROSA LUMBER CO.,

By WILLIAM S. Rosasco, Jr., President.

FLORIDA

Caryville:

V. E. Garner Lumber Co.

Hoges & Arnold Lumber Co.

Chipley:

Everett Bros. Co.

Yellow Pine Lumber Co.

Crestview:

Fleming & Sterling, Box 34

H. L. Foster-Milligan Saw Mill Co.

De Funiak Springs:

Goodwin Lumber Co.

Hill Lumber Co.

Niceville:

Bay Lumber Co.

Pensacola :

Abbott Lumber Manufacturing Co.

Bagdad Lumber & Export Co., B. M. Henderson, Box 710

Santa Rosa Lumber Co., care of William Rosasco, Sr., 50 West Brainerd

V. E. GARNER LUMBER CO.

Caryville, Fla.

OCTOBER 29, 1953.

DEAR SIRS: With this letter we are enclosing a memorandum giving information on the production of lumber and timber by the Government at several bases and, in particular, Eglin Field. We, with the assistance of regional and national organizations, as well as our Congressman and Senator, have been endeavoring to have the Government cease the operation of such units and to get out of competition with private industry. This memorandum gives full information as to the procedure and we believe that, if you are interested in bidding on Government logs, now is the time to take action. We hope that you will see fit to contact the commanding officer at Eglin Field, sending copies to those mentioned in this memorandum. It will be helpful to the smaller operators and to the industry if you will do this.

We would be glad to hear from you as to your intention.
Yours very truly,

THE ALGER-SULLIVAN LUMBER CO.,
Sales Agent.

THE ALGER-SULLIVAN LUMBER CO., CENTURY, FLA.

Sale of timber and/or logs from Government lands to private operators versus Government-operated milling units in competition with private industry Prior to World War II, timber was marked on Government lands and sold to private operators to be produced into lumber and sold as such. However, a change came about during the war, partly because lumber was scarce, but primarily for the reason that the administration was endeavoring wherever possible to set up industries of all types in competition with private industry. This was particularly bad in the lumber business in the South for the reason that there is not sufficient timber available for the smaller operators for continuous operation, and by virtue of lost time created an excessively high cost and, of necessity, labor lost much time. The military owns substantial acreage in the South and we learn that there are milling units on several of the bases producing lumber and timber and, in some cases, on reservations such as the Air Force Base at Eglin Field, where good longleaf timber is available, they are not getting proper utilization. We are told that some of this high-quality longleaf stock is being put into boxing and crating materials where low-grade lumber may have been used. This is just one illustration of bad practice.

For several years the National Lumber Manufacturers Association, our own Southern Pine Association, and our Congressman Sikes and Senator Smathers have been working desperately in an effort to stop production of lumber by the Government on these reservations in competition with private industry.

Within the last few days we have had letters from Congressman Sikes and Senator Smathers of happenings in Washington which are encouraging. On Tuesday, Mr. George Fuller, of the National Lumber Manufacturers Association, Washington, phoned confirming the information given us by Congressman Sikes and Senator Smathers and giving us a little of the inside information concerning operations on the several bases. It would appear now that it is an opportune time for the lumbermen to take advantage of an opportunity which we hope will soon present itself.

You are interested in the Air Force Base at Eglin Field, which has operated milling units for some several years and, in the last few years, expanded, installing kilns, planing-mill facilities, etc. We are told they are now producing approximately 30,000 feet a day and the lumber is being used on the base and on nearby bases, such as Tyndall, Brookley, etc. Naturally the commanding officers on these bases want to continue these units and they are using every excuse possible-such as hazard over firing ranges and the undesirability of having private industry logging from bases on which jets are operating. Pressure is being brought to bear whereby it seems probable that these milling units may soon cease and the Government will log from these reservations timber that is marked to be removed and on a bid basis will be sold at the gates of the Air Force Base at Eglin Field.

Mr. Fuller is interested in having those operators who are desirous of purchasing logs at the gates of Eglin Field to write the commanding officer of the base and tell him of their interest and it would be good, when you address the commanding officer, if you would send a copy of your letter to the following:

Mr. George Fuller, National Lumber Manufacturers Association, 1319 18th Street NW., Washington, D. C.

Southern Pine Association, National Bank of Commerce Building, New Orleans, La.

Hon. Robert F. Sikes, House Office Building, Washington, D. C.

Hon. George A. Smathers, Senate Office Building, Washington, D. C.

In writing the commanding officer, naturally, it may be well to mention the location of your milling operation and, if you lack timber for continuous operation, so state, mentioning at the same time that it will give your men, in the event you are a successful bidder, full-time employment.

We hope you will find this of interest and that you will promptly address the commanding officer following the suggestion set out in this memorandum. We will be interested in learning of your intention.

OCTOBER 29, 1953.

THE ALGER-SULLIVAN LUMBER CO.

At this juncture, Mr. Chairman, I would like to introduce in the record a memorandum dated October 29, 1953, for the Assistant Secretary of Defense (Supply and Logistics), with respect to operations by the Air Force of logging and saw mill operations with particular reference to Eglin Air Force Base. It is signed by Roger Lewis, Assistant Secretary of the Air Force:

Eglin Air Force Base. The Eglin Reservation has been under a forestry management plan for the past 43 years, with an annual timber cut of 2,800,000 board feet. Harvesting and milling of the timber is presently being performed by Air Force civilian personnel. All of the milled lumber is being utilized by the Air Force. Previous review of operating costs indicated that the lumber was being made available to the Government at a material saving over purchase of similar types of lumber through commercial facilities.

The mission of the installation involves the use of live ammunition during highly classified training and testing programs. Therefore, the restrictions which would have to be placed on a commercial enterprise to safeguard security information and insure the safety of logging crews, would make their harvesting activities uneconomical.

Similarly, I would like to introduce and read into the record a memorandum for the Assistant Secretary

The CHAIRMAN. That implication from this, is it not, that the Air Force was opposed to the action of your organization?

Mr. HONEYWELL. Not as far as I know, no, sir.

The CHAIRMAN. It says that the operation you recommended would be uneconomical.

Mr. HONEYWELL. It is their privilege to make the final decision. It is the responsibility of the Department of Defense.

The CHAIRMAN. It spoke also about it being against national security to let this operation be done by a commercial interest.

Mr. KEATING. I don't believe the commercial firms will impair national security. It is the same old story of any outfit in Government that has been doing something they want to keep on doing. They have people whose jobs are to be protected. They get into this habit of running something on their own and they want to continue to do it, and it takes all kinds of pressure from the top to make a change, which I understand is being exerted, and I am in sympathy with the effort to get them out of a lot of these activities that people never associate with that particular agency. People think of the Air Force as flying airplanes, not running sawmills.

The CHAIRMAN. The letter speaks for itself, whatever it may imply. Go ahead.

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