Compania Minera Huehuetenango, lead contract---. Comparison between Federal assistance extended to foreign min- Consolidated Copper Mines. 310, 334 23 470 Contracts issued to date, Contract Negotiations Division, De- Defense of the United States sealanes in the event of a third Domestic copper contracts_-_-_ 469 Dumping and break in lead and zinc market (statement of John 468 Duty-free stockpile purchases. 128 Duty paid on tungsten sold to industry-- 130 ECA, MSA authorizations for procurement by commodities and 457 ECA, MSA loans. 293 ECA, MSA procurement authorization of materials sent abroad 456 ECA, MSA table of funds given to foreign nations for purchases__ 455 Economic Cooperation Authority-Mutual Security Agency funds 455 Fiscal year 1954, MSA authorizations by area of source, July General conditions for strategic and control materials and services 236 Granby Consolidated Mining, Smelting & Refining Co. of Canada__ 244 170 Howe Sound Co 489 Hudson Bay Mining & Smelting Co., Ltd.. 327 Impossibility to get critical materials from abroad in time of war 2 300 Present and proposed Air Force strength____ 569 tion-Cumulative ECA and mutual defense assistance program, 456 Procurement authorizations by commodity group and area of 457 Purchase for foreign-operations administration__ 31 Purchases for resale by Emergency Procurement Service__ 32 86 Appendix B.- Annual report of financial condition and operations, defense 608 Appendix E.-Federal Property and Administrative Services Act of 1949, as amended, with analyses and index, of the, General Services Adminis- STOCKPILE AND ACCESSIBILITY OF STRATEGIC AND CRITICAL MATERIALS TO THE UNITED STATES IN TIME OF WAR WEDNESDAY, SEPTEMBER 23, 1953 UNITED STATES SENATE, COMMITTEE ON INTERIOR AND INSULAR AFFAIRS, The committee met at 9:15 a. m., pursuant to adjournment, in room 414, United States Courthouse, Seattle, Wash., Senator George W. Malone (chairman) presiding. Present: Jerome Alderman, chief counsel for the subcommittee, George Holderer, subcommittee staff engineer, Thomas F. Flynn, Jr., subcommittee assistant counsel, and Richard G. Sinclair, subcommittee accountant. The CHAIRMAN. The meeting will be in order. This hearing has been called for the purpose of carrying out Senate Resolution 143, 1st session, 83d Congress. (See appendix.) This resolution directs the Interior and Insular Affairs Committee to conduct an investigation and to study the accessibility of critical raw materials to the United States during time of war, also to assure the availability of supplies of such critical raw materials adequate for the expanding economy and the security of the United States. At this point, I would like to place in the record a list of strategic and control materials. It will appear in the appendix at page 796. STOCKPILE ACT Public Law 520 which is popularly known as the Stockpile Act was passed by Congress on July 23, 1946. The intent of the Congress in the enactment of this legislation was to build up a reserve of strategic and critical materials sufficient to tide this country over in case of an emergency. This act particularly provided "that the natural resources of the United States in certain strategic and critical materials being deficient or insufficiently developed to supply the industrial, military, and other needs of the country for common defense, that it is the policy of Congress and the purpose and intent of this act to provide for the acquisition and retention of stocks of these materials, and to encourage the conservation and development of sources of these materials within the United States, and thereby decrease and prevent wherever possible the dangerous and costly dependence of the United States upon foreign nations for the supplies of these materials in the time of national emergency. "BUY AMERICAN ACT" CIRCUMVENTION The act further provided that we "Buy American." My attention has been called to the fact that despite the congressional mandate to buy American it was circumvented by edict of President Truman when he signed the Stockpile Act. When President Truman approved the Stockpile Act he issued a statement in which he said that it was only because of the overriding importance of the act that he was able to overcome his reluctance in signing a bill with the "Buy American" act provision. He pointed out that there can be exceptions to the rule in "Buy American" and he enunciated a policy to circumvent the "Buy American Act" in the following words: "This provision clearly indicates that the stockpiling program should not be used as a means of general subsidization to those domestic producers who otherwise could not compete successfully with other domestic or foreign producers." Further that "It is the policy of this Government to work for international action to reduce trade barriers." ECONOMIC APPROACH TO WEAKEN NATION The committee intends to examine into the background and the origin of the policy followed by President Truman as well as to study the effect that it had on our security and development of the domestic sources for strategic materials. I am certain that President Truman was not aware that his policy originated in the minds of people who did not have the best interests of the United States at heart. There have been two approaches to defeat our Nation. One is political which is being investigated by several committees in the House and the Senate, and the second is economic. This has been the more subtle, insidious, and effective effort. Studies made by the committee staff indicate that certain known subversive elements in the Government, in high places in the Treasury Department and other agencies, originated the erroneous theory that the United States is a have-not nation. It was their plan and project to make the United States dependent upon foreign sources of supply which in time of war would fail us and make us vulnerable and defenseless. Informed experts have stated that it would take our domestic raw material sources 3 to 5 years to come into production, and by that time the war may well be lost. These elements have succeeded in planting in the minds of most of the people in the United States the widespread publicity and with the aid and assistance of well-meaning ill-informed persons that our natural resources have been exhausted, that we must obtain our strategic materials from across the oceans, that we must aid and assist foreign exploration and expansion of the production of raw materials abroad, that we should discourage domestic production and exploration for new ore bodies and sources of strategic and critical materials. IMPOSSIBILITY TO GET CRITICAL MATERIALS FROM ABROAD IN TIME OF WAR Well-known and authoritative experts agree that in time of war it will be almost impossible, or at the best so costly in ships and men as to make it prohibitive, to ship strategic, critical, and essential materials for war across either major ocean from Europe, the Mediterranean, Africa, the Far and Near East, and Australia. Well-known strategists and tacticians contend that sources for strategic materials in these areas will be denied to us because they are within easy bombing range of our principal potential enemy, the U. S. S. R., and its satellites. Another consideration is that some nations who are presently |