The Open Door

For weeks, Defense Mobilizer Charles E. Wilson has been besieged by Congressmen from "distress" areas like Detroit to do something about the unemployment created by lagging defense orders amid civilian cutbacks. At the same time, small businessmen have been clamoring for a bigger share of defense work. Last week the Administration gave in to the political pressures and issued two orders that scandalized and alarmed many a Congressman.

P: Wilson authorized defense procurement agencies to channel orders to areas where there is a manpower surplus, and pay higher prices, if necessary, to get the arms made. He set up procedures whereby entire industries (e.g., New England textiles) may be declared in a "depressed condition" and given precedence in Government buying.

P: Small Defense Plants Administrator Telford Taylor, newly endowed with powers wrested from Secretary of Commerce Charles Sawyer, announced that even where competitive bids are required on defense contracts, the procurement agencies have been empowered to ignore the lowest bid, if necessary, to give small business what he considers its fair share.

To Congress, already protesting waste in defense spending, both moves seemed to open wide new doors of extravagance and favoritism. At the very least, they meant a subsidy to some holders of defense contracts. Southerners complained that Wilson's "distressed industry" plan might wipe out the booming South's competitive edge over New England textiles. Cried South Carolina's Senator Burnet R. Maybank, whose Senate-House "watchdog" committee launched an immediate inquiry: "I am not going to sit here and preside over the liquidation of the Southern textile industry." Added South Carolina's Governor James F. Byrnes: "It's nothing but a subsidy to reward the imprudent manager."

The two plans, no matter how well-intended, had a suspicious look in an election year. Badly used, they could easily turn the defense program into a gigantic pork barrel. In any case, they would boost the cost of an already inflated arms program.

Last week DPAdministrator Manly Fleischmann found that the armed services had allocated 20 million more pounds of aluminum than they could use under the "stretch-out" arms program. He granted an extra 1,000,000 Ibs. for the auto industry. As a result, the industry, which had been authorized to turn out 930,000 cars in the second quarter but allowed only enough copper and aluminum for 800,000, hoped it might be able to boost its production closer to the authorized quota.

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