program. And of course you gentlemen do not mind my saying that when we started in this Maritime Commission program you did not have anything on the Gulf coast.

Mr. STARNES. That is what I want to bring out. We had nothing on the Gulf coast at that time and the Commission has helped to build the industry up down there?

Admiral LAND. We have tried to and have tried to distribute this burden throughout the United States. Of course, I think we have succeeded. I do not mean to say we have satisfied everybody; God knows that is not in the picture; but we have done a job that, frankly, I do not apologize for, in the distribution of the work. In individual cases, we have had an awful lot of trouble trying to explain; but if you will look at the picture, look at the facilities, look at the housing, power, transportation, and then go behind those and find the financial structure that backs these things, I think you will find that the most of them are pretty sound. We may have some "lemons" in this; in fact, on the small fry, we have had to cancel some contracts we thought were sound, because they could not come through financially; but, on the major program, that is not the case. We have only one doubtful case in the whole major program picture right now.

KAISER-TODD SHIPBUILDING CO.

Mr. STARNES. Is there anything to the report that one contracting or constructing company has practically a virtual monopoly on the business of repairing, building, etc., in the Pacific Northwest?

Admiral LAND. That, as a generic statement, might be considered to be the case; but, broken down, it is not correct. Because, in each case, the companies are subdivided. You are speaking of the KaiserTodd outfit?

Mr. STARNES. Yes.

Admiral LAND. They have the major interest in Seattle; they have the major interest in Tacoma; they have the major interest in Portland. But in Tacoma, for example, I think that is a straight Todd show, and was started before the emergency program came along. I do not know about Seattle; that is wholly Navy except for the repair yard. As far as I know, that is straight Todd. That was started for the emergency.

In the Pacific northwest, the Commission is concerned with the Seattle-Tacoma plant at Tacoma-a Todd outfit, and with the Oregon Shipbuilding plant at Portland-a Todd-Kaiser outfit but Kaiser managed. They came from "The Six Services Company" or "The Six Companies" which built many engineering projects of great magnitude. They have the administrative and executive brains and the kind of equipment you need for plant facilities; and coupled with that there is the Todd brains, which are the shipbuilding brains.

There has been criticism, and the statement you made has been put before the Commission a dozen times, but I invite the attention of you gentlemen to the fact those are the people who are delivering the goods. They have finished the first ship and it is in commission; they are finishing the other ships and they are going to be in commission, and they are doing the best job.

THEY PRODUCE RESULTS- -COMPLETED SHIPS

Mr. FITZPATRICK. You are looking for results?
Admiral LAND. I am.

Mr. FITZPATRICK. Not for favoritism?

Admiral LAND. I am looking for completed ships. I have stopped worrying about launchings right now; I want completed ships. In order of merit to date:

No. 1 is Oregon Shipbuilding Co. at Portland. That is a ToddKaiser outfit. No. 2 is California Shipbuilding Co. at Los Angeles; that is a Todd-Kaiser outfit.

Mr. STARNES. That outfit, however, was also given the benefit of stronger financial support in the form of Government loans than any other?

Admiral LAND. I do not think so. It had nothing to do with Government loans, so far as I know. We did not have defense contracts; we had facility contracts. So far as I know, I do not think they got a single Government loan.

Mr. STARNES. From any source whatsoever?

Admiral LAND. Not to my knowledge. In all of these new yards we have two contracts; we have a facilities contract, which is negotiated, controlled by ourselves; then we have a shipbuilding contract which is also controlled and negotiated by the Commission. But the facilities contract follows the standard form as set up by O.P.M. when it first came into being, called the National Defense Council. And, with small modifications, we have followed that all the way through with the new shipyards.

Recently, on the small shipyards, we have gone into what we call "Defense Plant Corporation loans" and I do not know which is the better method of procedure. Of course, the Government, in the long run, is going to pay for this; there is no question about that, because you know Jesse Jones takes care of his corporation and is not going to lose a nickel. The Maritime Commission is going to be stuck for whatever the loss is there. Of course, we are leasing the property; we do not buy any property, but the machinery is bought and we will inherit those facilities unless somebody wants to buy them. But, on either basis, we are following the standard forms set out by the Defense Council and the way was paved by the Army and Navy so, as we came along, we thought we made a few improvements here and there. I do not know whether anybody else would agree with that, or not, but that is what we have done.

TRAINING OF SHIP PERSONNEL

Mr. STARNES. How are you getting along with training personnel? I was very much interested in that program and have followed it through as best I could.

Admiral LAND. By the end of 1943, we will have available, trained, 3,500 deck officers and engineers, and 15,000 seamen. There is something in my statement that gives that, but I thought you would rather have the high spots.

Now, we expect to put in commission, in the calendar year 1942, somewhere between 500 and 600 ships. We expect to do the same thing in 1943. That is a total of 1,200 ships in those 2 calendar years. They will require from 30 to 35 men per ship, and 6, 7, or 8 officers. Multiply that by 600 per annum, and you will see we must get something like the 15,000 to 18,000 men required for these ships in each of the 2 years. Of course, we have some men trained now; but with the training program and with the steps being taken by the Maritime Commission-in fact, there is 1 complete agency set up just for this purpose we think we are going to take care of this problem. As a matter of fact, as we left the office this morning, there was on the docket the question of whether we would take over, for training purposes the charters of 2 ships belonging to the Eastern Steamship Co. Due to the fact this declaration of war has made this more urgent than it was 48 hours ago, I imagine the Commission will approve that and we will take control of those to increase the training program that I have given you here.

Mr. Knight here can give you the details much better than I can, but those are the high spots.

Mr. STARNES. Is the training program coming along satisfactorily, Mr. Knight?

Mr. KNIGHT. Yes, sir; I would say so. We have had to step it up about three times, as we increased the number of ships under contract, and this morning we are adding two more training ships, we hope, which will give us an added capacity for about 350 more officers every four months and about 600 more seamen every six months, so that over a period of a year, that would be about 1,000 more officers and about 1,200 more seamen in addition to anything we have had before.

Mr. STARNES. What has been your main difficulty in initiating and carrying along the training program up to the present time, and what do you consider your major drawback?

Mr. KNIGHT. The initial difficulty we had when we were starting the program was that it was a peacetime proposition and not an emergency proposition, so we had opposition from organized labor. I am glad to say that this has been entirely overcome voluntarily on their part, because they are assisting us in every way they can now. They are now finding they have to have the men and they are on record with us as being willing to take into their unions all of the men we have in training for positions on vessels which they have under

contract.

We have accomplished everything we set out to accomplish on the basis of the program we had outlined; but, as I say, we have had to step that up about three different times.

Mr. STARNES. Due to the emergency, of course, you are going to have a continuously expanding program all along?

Mr. KNIGHT. We are set up to give 6 months' training to a seaman. That makes him a rated man; either an able seaman or a qualified member of the engine department. That is the only way he can become a rated man. An ordinary seaman and wiper does not need any experience. Of course, we are trying to train about half the number of men that are required on the ships. The other half can be supplied from untrained men if necessary.

Now, if we reduce the time of training to less than 6 months, we won't be able to make him a rated seaman unless the Bureau of Marine Inspection reduces its requirements, but we will be able to make him a trained seaman, and we can double the capacity_by reducing the time for training. That we do not want to do unless it is absolutely necessary.

Mr. FITZPATRICK. And organized labor is cooperating with you? Mr. KNIGHT. Absolutely.

Mr. STARNES. I am glad to hear that, because they opposed it in the beginning.

Admiral LAND. Yes, they did, and on the west coast, at one time, they blacklisted and blacklegged the graduates.

I would like to supplement what Mr. Knight has said. We have had the finest cooperation from Mr. Jones, the Secretary of Commerce, and from Commander Field, Director of the Bureau of Marine Inspection and Navigation, in making necessary short cuts as to training; for example, as you know, the Naval Academy is now graduating two classes a year. We all know that a 4-year course is better; but, in a case like this, we can get away with it, and that is what we are doing; but we do not want to do it unless necessity forces us to do it. But we have had the best cooperation from them and fine cooperation from the Congress, and we recently got through a bill which you gentlemen passed, which is going to help the general situation; not so much the personnel, but it amounts to the same thing. But where an emergency arises, you can at least wink at something or other, whether it is an extra boat or an extra raft, or something like that, and take a chance. And, after all, we have to take chances in war. Mr. FITZPATRICK. Is the Merchant Marine Academy cooperating? Admiral LAND. Oh, yes, splendidly, as far as I know. Mr. KNIGHT. They certainly are.

Mr. STARNES. I want to commend you on this particular program, because I thought it was a far-seeing idea. It should guarantee the operation of a successful and profitable merchant marine after the emergency has passed.

Admiral LAND. It is just as important as ships.

Mr. STARNES. Absolutely, and I commend you for the foresight and energy with which you set about the task, and I am glad to hear those who once opposed the initiation of this program are now cooperating.

USE OF SMALL SHIPBUILDING COMPANIES

Mr. HENDRICKS. Admiral, I have not heretofore been a member of this subcommittee and, of course, do not know as much about the program as I should, and there are one or two questions I would like to ask.

What are we doing about small shipbuilders? For instance, it is not so small, but are you familiar with Lykes Shipbuilding Co. in Tampa, Fla?

Admiral LAND. Yes, sir.

Mr. HENDRICKS. Are they building ships for the Maritime Commission?

Admiral LAND. The Tampa, Fla., Shipbuilding Co., which was started up by the Maritime Commission, has been taken over by

the Navy and is completely in the Navy's hands. That is a yard we started from scratch and you know the heck of a time we had when we started it.

Mr. HENDRICKS. Cannot you make use of the smaller companies, even though they just build one or two boats, for instance, shipbuilding companies that build yachts? In my own district, at Daytona Beach, we have two shipbuilding companies, the Howard Boat Works and the Daytona Beach Boat Works. I think the Daytona Beach Boat Works have a contract with the Government-I do not know whether with the Maritime Commission or not-for the building of defense ships.

Admiral LAND. It is with the Navy.

Mr. HENDRICKS. But the Howard Boat Works does not have much and I am just wondering if you could make use of them for building small ships.

Admiral LAND. So far as the Maritime Commission is concerned, no; because we do not go in for the building of small boats. So far as the Navy is concerned, yes, because you gentlemen just passed that appropriation for $300,000,000 this month to get the Navy a whole flock of small boats by purchase, construction, or otherwise. The Army also is in the market for small boats and there is not any question in my mind but what all hands are going to be in here for using what we called, in the last war, "spit boxes," and which won't be worth much of anything to anybody when the war is over.

Mr HENDRICKS. In other words, those two companies are not building ships for the Maritime Commission?

Admiral LAND. No, sir; they are not.

Mr. HENDRICKS. I only mention those two, but I know there are others all up and down the coast.

Admiral LAND. I want to say, in answer to that question, we have enough shipbuilding plants going in these United States today so far as number of ways are concerned, because the Maritime Commission laid down a conservative program of two ships per way per year. Now, any good shipbuilder, after his first ship, any one of them, can build three, and the better ones four a year; so that you can increase, overnight, the shipbuilding capacity of these United States by 50 to 100 percent. That is, in shipbuilding capacity, so far as your ways are concerned. But you cannot increase overnight the capacity to turn out completed ships, because you have not the steel, you have not the skilled personnel, you have not the white-collar brains, you have not the machine tools, and you have not, most important of ail, the propulsive machinery. But do not run away with the idea there are not plenty of shipbuilding plants in these United States today.

SATISFACTORY RESULTS OF SHIPBUILDING

Mr. HOUSTON. But you are pretty well satisfied with the specific results that are being obtained and the way you are going along at the present time?

Admiral LAND. I think they are doing a splendid job and I think they deserve the support of the country and the whole shipbuilding fraternity. As I said, the velvet we had was lost on account of strikes, but I hope and pray from now on there won't be any more of them.