(4) Provide a nucleus organization capable of rapid expansion as an operating agency for administration of production and materials controls in the event of a future emergency;

(5) Foster the transition from emergency mobilization efforts to the operations of a free enterprise system;

(6) Except as otherwise provided by law or Executive order, establish the Business and Defense Services Administration as the logical point in Government for representation of the domestic interests of business and industry in their relations with other governmental agencies;

(7) Provide other departments and agencies of the executive branch and the Congress with required information and judgment concerning the viewpoints and interests of business and industry;

(8) Cooperate in assuring consideration of the domestic needs of small business enterprises with the view to strengthening their position in the national economy; (9) Obtain the views and advice of business through the establishment of, and consultation with, industry councils and industry advisory committees, and through cooperation with trade associations;

(10) Encourage efficient and effective domestic distribution of goods and services to further the expansion of domestic markets necessary for optimum utilization of the Nation's productive capacity;

(11) Act as a clearinghouse for Government technological information of interest to business and assist industry in the voluntary standardization of products; and

(12) Cooperate with other agencies of Government in programs to achieve economic stability and growth and with industry in the development of industrial and business programs having as their purpose a sound, prosperous, and expanding economy.

Delegation of authority from the Director, Office of Defense Mobilization is summarized by the following order:

EXECUTIVE OFFICE OF THE PRESIDENT

OFFICE OF DEFENSE MOBILIZATION

Defense Mobilization Order-I-8

Subject: Assignment of Defense Mobilization Responsibilities.
To: The United States Department of Commerce.

I-Gen-DMO-8
February 10, 1954

By virtue of the authority vested in me pursuant to the National Security Act of 1947, as amended; Reorganization Plan No. 3, effective June 12, 1953; the Defense Production Act of 1950, as amended; Executive Order 10480 of August 15, 1953; the Strategic and Critical Materials Stock Piling Act of 1946, as amended; and in order to facilitate the coordination of Federal policies and programs for current defense activities and readiness for any future mobilization, it is hereby ordered:

1. The Secretary of Commerce will be responsible for the development and administration of preparedness measures relating to those industries assigned to him by Executive Order 10480 and Defense Mobilization Orders-I-7 and VII-5. Such preparedness measures should be undertaken within a work program which is consistent with the defense mobilization assumptions and objectives for the Government as a whole. To assure such consistency, the work program will be submitted to the Director of the Office of Defense Mobilization for review. 2. The measures for which the Secretary of Commerce is responsible are as follows: (a) Current administration of the priorities and allocations program under title I of the Defense Production Act.

(b) Development and maintenance of a simplified production control system including the necessary supporting orders and regulations for use in event of stepped-up or all-out mobilization; cooperation with the office of Defense Mobilization and other appropriate agencies in planning other distribution controls related to those under his jurisdiction.

(c) Development of estimates of defense-supporting and civilian requirements and of the materials and facilities needed to supply those requirements under conditions of a stepped-up or all-out mobilization; and the preparation of detailed

studies and analyses of potential mobilization deficiencies for such items together with the problems involved in meeting them.

(d) Analyses of the problems involved in maintaining an adequate mobilization base in defense-supporting industries and recommendations regarding necessary programs.

(e) Current activities relating to the expansion of productive capacity and supply; recommendations for the establishment or modification of expansion goals and the programs needed to meet those goals in order to overcome deficiencies in the mobilization base, screening and making recommendations on requests for rapid tax amortization and for loans and procurement contracts under the Defense Production Act and maintaining the records required to measure progress in achieving expansion goals.

(f) Provides the Office of Defense Mobilization with estimates of requirements of industrial consumption in connection with the stockpiling of strategic and critical materials. Assists the Office of Defense Mobilization in formulating plans for the stockpiling of strategic and critical materials and, to the extent necessary, in the acquisition of such materials and the expansion of domestic sources of supply.

(g) Guidance and leadership to industry in the development of plans and programs to insure continuity of essential production in the event of attack; identification and rating of facilities, including materials, products, processes, and services, based on the relative importance thereof to military and defense supporting production and the essential civilian economy.

(h) Guidance to local dispersion committees, and the review and approval of local dispersion programs.

(i) Development and maintenance of plans to insure the continuity of the essential functions of the Department in the event of attack on the United States. 3. The work program to be undertaken by the Department of Commerce shall indicate the priority and scope of the work to be carried on in each of the areas enumerated above and the industries to be covered. Periodic reports of progress shall be submitted as requested.

4. This order is not intended to affect any delegation of authority heretofore conferred upon the Secretary of Commerce.

ARTHUR S. FLEMMING,

Director.

JUSTIFICATION FOR EXECUTIVE DIRECTION

Included under "Executive direction," are the Administrator, the Deputy Administrator, three Assistant Administrators (w. o. c.) and their clerical and stenographic assistants, and a small administrative staff which provides a coordination of administrative services for the Administration.

The Administrator exercises broad policy and operational direction over all functional activities coming within the jurisdiction of the Business and Defense Services Administration.

The Deputy Administrator acts for the Administrator on all such policy and operational matters.

There are three Assistant Administrators employed on a w. o. c. basis. Each exercises broad policy direction over the activities of certain assigned industry divisions. It is expected that the three Assistant Administrators will be relatively free of operating details so that they might devote themselves to formulation of policy and the solution of broad industry problems. The Assistant Administrators can be likened to company vice presidents operating as a kind of executive committee. It is their job to see that the industry divisions under their jurisdiction are well managed by the Division Directors and that their policies are consistent with overall agency policy. It is the job of the Assistant Administrators to see that all activities, both existing and contemplated, are carried out in such a manner as to make certain that American industry has been consulted at all times and that agency activities are consistent with their recommendations, where feasible. The Assistant Administrators are vitally concerned with the establishment and maintenance of affirmative industry relations.

A small administrative staff coordinates the management activities of the agency in seeing that the overall mission of the agency is carried out in an efficient, businesslike manner. It provides for coordination of budget, administrative, and personnel services which are performed on behalf of the BDSA by the Office of the Secretary. A minimum staff to provide such service liaison activity is required to assure prompt and efficient handling of the agency's administrative affairs.

JUSTIFICATION FOR STAFF SERVICES

Included under this activity are personnel engaged in performing activities on programs which cross all industry divisions. It is necessary for this staff to be organizationally independent although they are in fact operating adjuncts of the programs carried out by the industry divisions. A large number of the programs of the industry divisions are authorized by delegation of ODM. Included among these are the allocation and production controls (defense materials system), recommendations in connection with the stockpiling program, recommendations on requests for certificates of necessity in connection with tax amortization and loan, scrap and salvage activities, postattack and plant protection programs, capacity studies and mobilization requirements studies, and identification of key industrial facilities. These staff services are conducted with the least possible number of people required to do the job effectively. In most instances, one or more of these major programs are handled by one adviser. The work of these advisers is at all times closely coordinated with the Assistant administrators and the operating divisions.

Also included under "Staff services" are six positions for the Office of Small Business, which reports directly to the Administrator of the Business and Defense Services Administration and advises him, as well as the Secretary, the Assistant Secretary for Domestic Affairs, and other officials of the Department, on problems, issues, and services in and for the small business community.

The function of the small business staff is one of coordination of the Department's regular activities for the maximum benefit to small business generally. This function of coordination takes two forms, external and internal.

First, it is the responsibility of this staff to work cooperatively with officials of the Small Business Administration to prevent duplication of projects and expense and to make the facilities, research, reports, statistical data, and publications of the Department available to that agency.

The small business staff will also work with the Treasury Department on taxation studies and with the small business committees of the Congress on behalf of the Department.

Second, it is the responsibility of this staff to coordinate the research, reports, and programs of the several activities of the Department so that such regular functions of service to all business will take into account the position of small concerns and have practical value to them.

JUSTIFICATION OF INDUSTRY DIVISIONS

The 25 industry divisions of the BDSA are the hard core of the Administration. In these divisions, each representing a major segment of American industry, are performed the activities and maintained the facts and knowledge which are required to assure the achievement of military and atomic energy programs by channeling materials and products under the defense materials system, developing a practical mobilization program, integrating defense production and mobilization programs with industry plans and maintaining civilian production and employment on a sound basis, and fostering the transition from emergency mobilization efforts to operation in a free enterprise system.

The functions of the industry divisions are:

(1) Administer the defense materials system and take related actions in support of military and atomic energy programs;

(2) Review and make recommendations to the Office of Defense Mobilization on expansion goals, tax amortization, and domestic loan applications;

(3) Make recommendations on the stockpiling or the disposal of stockpiled strategic materials and equipment in relation to industrial requirements to avoid any adverse effects on the national economy;

(4) Participate in the development of the Government's mobilization base program for the provision of adequate industrial facilities in the event of national emergency;

(5) Provide the mobilization authorities with basic data for use in the idențification and rating of facilities to be protected against the possibilities of enemy damage;

(6) Provide assistance to the Office of Defense Mobilization in regard to participation with industry in postattack planning;

(7) In furtherance of economic stability and growth, provide information and recommend to the Administrator and the Assistant Secretary for Domestic Affairs policies designed to promote industrial expansion and business progress for their

guidance in the determination of policy and in the presentation of business opinion and advice to the executive and legislative branches;

(8) Collect, analyze, and disseminate information on the condition and levels of business activity in specific industries and trades pertinent to the production and marketing of industrial commodities and resources for governmental purposes and as a service to business and trade groups;

(9) Evaluate policies, plans, activities and orders of the Department of Commerce, as well as existing and proposed legislation affecting business, from the standpoint of the workability of these measures in everyday business and industrial operation and report to the Administrator and the Assistant Secretary for Domestic Affairs;

(10) Assess the impact of Government operations insofar as they impinge on the interests of private business and report such assessments to the Administrator and to the Assistant Secretary for Domestic Affairs; and

(11) Assist domestic business in its relations with other departments and agencies of the Government.

JUSTIFICATION OF TECHNICAL SERVICES

The new organizational pattern brings together four activities which have worked along parallel lines without special coordination in the past. Two, trade association and area development, are "staff" operations with broad responsibilities. Two more, commodity standards and technology, are specialized program groups which develop new and valuable information.

The Trade Association Division is one of the most respected activities of the Department of Commerce. This Division, now staffed by 2 professional and 1 clerical assistant, is the Department's focus for contact with the Nation's 16,000 nonprofit business organizations. The Secretary intends to make more use of trade association cooperation in carrying out "service to business." Thus, this "skeleton" organization is faced with an increasing responsibility and workload in the coming fiscal year.

The Area Development Division is the Department's point of contact for nonprofit groups with whom the Department is planning to work more closely than in the past. It is the firm policy of this administration from President Eisenhower down to decentralize Government activities whenever feasible. Within the Office of Technical Services this means more use of State and regional development agencies, and community groups concerned with economic development. In this work, the Area Development Division brings together the data and technical resources of the Department so that they will effectively assist in the industrial and economic growth and diversification of areas.

The Technology Division is the Department's "clearinghouse" for scientific and technical information. This is a two-pronged activity-(a) the assembly and preparation of factual replies to inquiries from business firms and (b) the "release" mechanism for the Government stockpile of new scientific facts which constitute the end products of Federal research. The staff of the National Inventors Council has been placed with this activity since the technical knowledge accumulated by the Technology Division is helpful to the National Inventors Council in their study of new ideas for defense.

The Commodity Standards Division provides direct assistance to industry in the development of voluntary programs aimed at the reduction of waste in materials and effort. It should be noted that this Division is also severely restricted in responding to industry demands because of budget limitations. In fiscal 1948, the unit comprised 60 people; today it is about one-third as large. While this reduction in force was in progress, industry requests for leadership and assistance increased. This backlog, continuing to grow in magnitude, is far in excess of the present personnel and facilities. Thus, the addition of 2 professional and 1 clerical employees requested herewith is imperative.

The cooperation between these four activities provides a reciprocal strengthening of effort. For example, the information assembled by the Commodity Standards and Technology Division will be more effectively channeled to industry through the guidauce of the Trade Association group. Similarly, Area Development's efforts in providing factual data to State and regional groups will benefit through direct links to the other three divisions. Thus, the Office will be able to respond to the Secretary's demand for stronger and better services to business while holding staff to minimum operating levels.

JUSTIFICATION OF FIELD SERVICES

This activity covers the Department of Commerce Field Service consisting of the Office of the Director in Washington, the Administrative Service in Chicago, and 33 field offices located in the following cities:

Responsibility for the direction and supervision of the Field Service is placed with the Office of the Director of the Field Service, who in cooperation with the units of the Department represented by the Field Service, formulates policies and administers field programs. In carrying out these responsibilities, appropriate authority is delegated to the regional directors and the district managers to assure full utilization of the Department's resources in assisting the business public on day-to-day problems in specific areas. The departmental units represented by the Field Service include the Business and Defense Services Administration, the Bureau of Foreign Commerce, and the office of Business Economics. The statistical output of the Bureau of the Census and the technical reports of the National Bureau of Standards represent an important part of the material used by the field offices in their business development programs. Among the non-Commerce agencies represented by the field offices are the Foreign Operations Administration and the Superintendent of Documents.

Exclusive of the offices established for the administration of the National Production Authority program, all of which have since been closed, we normally maintain 42 field offices which number was reduced during the current fiscal year to 33. With the reductions in the number of field offices, as well as personnel, the Department has embarked on a greatly expanded cooperative office program. Under this program, chambers of commerce and similar organizations agree to act as the local representatives of the Department of Commerce in making the information and services of the Department available in local business communities. Currently we maintain 898 such cooperative offices, and increased emphasis will be placed on this program in order to expand and strengthen this service. The proper servicing of a wide network of cooperative offices necessitates the maintenance of properly manned field offices at strategic locations through the United States.

During the current fiscal year the appropriations for the Field Service amounted to $1,965,000 and the estimate submitted herein calls for the same amount.

JUSTIFICATION FOR

The Defense Air Transportation Administration (DATA) is responsible for planning and directing the mobilization of civil aviation resources. In time of peace its function is to assure that in time of war the air transportation facilities of the Nation are adequate and effectively used for national defense and the warsupporting economy. In wartime, it will put these plans in operation.

Most of the detailed plans to carry out DATA policies are worked out by industry-government advisory groups to utilize fully the technical know-how and organization of the air transport industry.

The outline of minimum planning is as follows: (1) allocate transport aircraft between civil and military support uses, (2) detail the military-support civil reserve air fleet, (3) provide the most flexible use of the remaining commercial fleet in a war air service pattern, (4) establish a standby air priorities system to assure that the most important and urgent traffic moves first, and as a guide for reallocation of aircraft to most essential routes, (5) assure a supply of skilled man