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A complete statement of loans made by the board may be found on pages 617 and 618 of the hearings.

Division of cooperative marketing: This division was transferred by Executive order from the Department of Agriculture to the Federal Farm Board. The nature and extent of its activities and their relation to the other work of the board is indicated in the following excerpt from the hearings:

Mr. CHRISTENSEN. Mr. Chairman, if I may add a word to what Mr. Legge has said, I would like to say this: Mr. Legge referred to the loan activities, and you might say they are only one activity of the Federal Farm Board to the carrying out of the purposes of the act. The activities of the division of cooperative marketing are directed toward the unorganized areas, as well as the areas where the farmers have organized small cooperatives but have not been able to make them operate effectively because of lack of proper set-up locally, or because of lack of coordination of their activities with other units.

That division was developed in the Department of Agriculture during the last three years under the authority of the act passed by Congress in 1926, and in this division for the first time a program of research and investigational work in the field of cooperative business has been developed. It is this personnel which has now been transferred to the Federal Farm Board, which is devoting its time to assisting groups to organize, and assisting the organized groups to perfect their organization set-up, operation procedure, and merchandising program along more effective lines.

With the aid of the staff of specialists in the division of cooperative marketing, which is more the field contact of the board, as contrasted with the loan division, which is primarily an internal operating unit, the members of the board are developing these set-ups and programs with the various commodity groups throughout the country.

It is because of the heavy demands on the board for advisory work of this kind that we have asked for an increase of $110,000 in that particular division, so that that personnel can be expanded.


The last appropriation for this activity was in 1925, and was in the sum of $50,000. The unexpended balances have been reappropriated from year to year, but a direct appropriation will be needed for the fiscal year 1931, which the Budget has estimated for in the sum of $22,220. In view of the fact that the board's average annual expenditure for the past five years has been $10,000, the committee believed it would be safe to cut the estimate for next fiscal year in the sum of $5,000, which it has done.


The Budget increase of $5,750, to effectuate salary increases due to reallocations, has been granted. Otherwise the approriation for the fiscal year 1931 is in the same amount as for the current year.

Last year 10 additional employees were granted for the purpose of enabling the commission to make a more thorough policing of the accounts of power companies operating under license from the Federal Power Commission. This work is important for the reason that the Federal power act permits the Government, at the end of 50 years, to recapture any power project by reimbursing the licensee in the sum of its actual net investment. The law charges the commission with the responsibility of prescribing methods of accounting and enforcing same, together with other work incident to the policing

of accounts, with a view to preventing so-called "padding" of capital accounts on the part of licensees.

The executive secretary of the commission disclosed that the accounting work is in arrears to a considerable extent. In only about 25 cases has the question of cost been settled. These are mostly small projects aggregating a total investment of about $21,000,000. In 12 other cases, aggregating about $115,000,000, the auditing work has been completed. In 10 other cases, involving an investment of $55,500,000, the statements of cost have been partially audited. The remaining projects, numbering about 25, with an estimated investment of $187,000,000, have not had their accounts audited.

The hearings disclose a pronounced difference of opinion between the secretary of the commission and the head of the accounting division as to the best method of prosecuting the accounting work. The latter is of the opinion that the commission should have its own staff of specially trained accountants for auditing the accounts of the major companies, farming the work out to other departments only in the case of the smaller and unimportant projects. The executive secretary thinks the commission's present accounting force should not be augmented and that other Government departments should be called upon to perform the work. This question of policy was gone into by the committee to considerable length. The opposing views of the disagreeing officials may be found on pages 383 to 454, inclusive, of the hearings.

A complete summary of the activities of the commission since 1921 and a statement of the total electric generating capacity of plants operating under Federal Power Commission license may be found on pages 454 and 455.


At the time the regular annual Budget was submitted to Congress, the law provided that on and after January 1, 1930, the administrative functions of the commission would pass to the Department of Commerce, leaving the commission a purely appellant body. On this basis, the Budget submitted an estimate totaling $168,610, to care for the work of the commission for the fiscal year 1931. On December 18, 1929, an act was approved extending indefinitely the life of the commission as an administrative body. This situation necessitated an entirely new Budget estimate, which was submitted in due course, and which provided a total of $375,000. The Bureau of Efficiency had made a study of the needs of the commission and recommended an organization considerably below that allowed by the Budget Bureau. The committee delegated one of its own members to visit the offices of the commission for the purpose of making an independent survey. The total amount recommended in the accompanying bill, namely, $450,000, is $79,205 below the estimate of the commission and $75,000 above the Budget estimate.


The Budget estimate of $1,437,460 for the Federal Trade Commission is an increase of $147,700 over the amount available for the current year. Added duties imposed by congressional work, trade

conferences, stipulation work, and false advertising work are the projects necessitating the increase in the appropriation.

The following excerpt from the hearings indicates the congressional inquiries now ordered or under way:

The commission has under way and is directed to make special inquiries, as follows:

Utility corporations, Senate Resolution 83, Seventieth Congress, first session. Newsprint paper, Senate Resolution 337, Seventieth Congress, second session. Cottonseed prices, Senate Resolution 136 and Senate Resolution 147, Seventyfirst Congress, special session.

Peanut prices, Senate Resolution 137, Seventy-first Congress, special session. Electrical energy, Senate Resolution 151, Seventy-first Congress, first session. Chain stores, Senate Resolution 224, Seventieth Congress, first session. Bread and flour, Senate Resolution 163, Sixty-eighth Congress (awaiting court action for further report).

Work on cottonseed and peanut prices and electrical energy, Senate Resolutions 136, 139, 147, 151, Seventy-first Congress, special session, can not be properly undertaken until funds are made available to employ the additions to the force needed to handle the work and to provide for necessary traveling expenses.

Since the organization of the commission 100 trade-practice conferences have been held, 45 of which were held during the last calendar year. These conferences have for their object the voluntary elimination by the industries of unfair and harmful trade practices.

Utility corporations inquiry: The following excerpt from the hearings indicates the progress of the commission on the inquiry pertaining to public-utility corporations:

Mr. JOHNSON. As the new year begins, the commission has completed its inquiry into the propaganda phase of Senate Resolution 83, and will soon begin hearings on the financial aspects of the investigation.

At the present time the utility associations are presenting their own evidence on the propaganda phase. The hearings on the financial part await the conclusion of the utilities' own presentation.

Approximately 150 witnesses have taken the stand since the first hearing in March, 1928, while about 4,500 exhibits have been introduced, and 8,200 pages of testimony taken. Eighteen interim reports of progress have been made regularly to the Congress, but no findings of fact have as yet been reported by the commission.

Chain stores: Slow progress is reported in the chain-stores investigations, due to "inability to hire enough people to do the work."


Salaries: The Budget increase of $34,400 has been granted, to provide a few additional employees for preaudit work. This work consists of auditing the accounts before their payment instead of subsequent to their payment as has been the practice. The preaudit is the final audit and for that reason requires greater accuracy and a higher grade of employees. The increased amount will not permit extension of the preaudit to all disbursing officers located in Washington. Much larger appropriations will be required before this can be accomplished. The preaudit saves through eliminating or reducing the work of administrative audits in the departments and also, in the saving of funds that are improperly paid out of the Treasury and are not recovered except without, in many cases, effort and expense and the lapse of considerable time.

Contingent expenses: The reduction of $62,000 in this item is due to the transfer of $54,000 for the purchase of tabulating cards to

the printing and binding appropriation, and an actual cut of $8,000 in the item.

Printing and binding: The increase of $63,000 in this item is an actual increase of only $3,000. The purchase of tabulating cards, transferred from the contingent expenses appropriation, amounts to $54,000, while $6,000 of the increase is occasioned by the discontinuance next year of the practice of crediting the appropriation with the proceeds of the sales of used cards. Such proceeds will hereafter be turned into the Treasury as miscellaneous receipts.


No Budget increases were submitted for the housing corporation. The Budget estimate of $250,000 for the Government hotels for the fiscal year 1931 has been eliminated from the bill, for the reason that the Public Buildings Commission has ordered the razing of the buildings immediately after July 1. The work of landscaping these areas will begin immediately, with a view to having the park between the Union Station and the Capitol fully developed by the date of the Washington Bicentennial.

The Housing Corporation has been, for some time, in the process of liquidation. There are balances due on properties sold of $2,142,821.82. Unsold real estate, with the exception of two dwellings, consists of 247 parcels of unimproved ground, principally vacant lots. The committee believes this bureau could well be abolished and its holdings transferred to the Treasury Department for final liquidation.


Regulating commerce: A Budget increase of $86,620 for this activity has been granted. The increase is necessitated by an accumulation of the work of examining accounts of carriers to determine net income subject to recapture and by the refrigeration investigations.

Safety of employees and travelers: A Budget increase of $7,860 has been granted for this work.

The total number of persons killed in 1927 was 6,382, and in 1928, 6,144, a reduction of approximately 200. The total number injured in 1927 was 42,603, and in 1928, 37,387, or a reduction of approximately 5,000.

Valuation of the property of carriers: The committee has disallowed the Budget increase of $1,007,313 in this item. This action was taken for the reason the committee was convinced the estimate had not had the proper Budget consideration. Subsequent to its presentation to the Budget, the committee has learned, a radical change of procedure from that contemplated when the matter was before the Budget was decided upon by the commission. This change of procedure, it is believed, will of necessity materially modify the appropriation need. While it is possible the commission will require some increase in this appropriation for 1931, the committee believes the amount of the increase should be arrived at by the Budget in the light of the change of policy on the part of the commission, and an estimate submitted therefor.


The Budget estimate of $60,000 for this memorial has been granted, under authority of the act approved February 25, 1929 (45 Stat. 1300). This act provides for Government cooperation in the creation of the memorial, which is to consist of the figures of Washington, Jefferson, Lincoln, and Roosevelt to be carved on the gigantic scale of men 465 feet in height upon the granite face of a mountain located in the Harney National Forest in the State of South Dakota. The act authorizes Federal cooperation on a 50-50 basis, but not to exceed a total of $250,000 for the Government's share. A previous appropriation of $100,000 has been made for this item.


There is a Budget increase of $21,000 to care for the rapidly increasing work of the committee. This augmentation of work is indicated by an increase of 50 per cent in the number of reports distributed last year as compared with the year previous. This reflects a general increased demand from the aircraft industry for the help of the committee.

The sum of $375,000 is provided for the completion of the $900,000 full-size wind tunnel authorized and begun last year. The construction of a hangar, to cost $60,000 is also provided for.


The bill carries the Budget estimate of $1,000,000 for loans to Porto Rican planters damaged by the hurricane of 1928. On the 1st of January, 1930, it was estimated that $1,840,000 would have been deposited in banks to the credit of borrowers.


Salaries: The Budget increase of $396,639, included in the bill, is for additional personnel due, partly, to the taking over of the Southern Railway Building and the new Internal Revenue Building, and to salary increases under the classification act, for which $10,000 is estimated.

General expenses: The Budget increase of $306,940 is due, principally, to the taking over of the Southern Railway Building and the new Internal Revenue Building.

Washington Monument Grounds: $30,000 of the funds appropriated under this office for 1930 and 1931 have been made available for preparing plans and estimates for the improvement of the Washington Monument Grounds to conform to the Lincoln Memorial Grounds and the approved plans for the Mall.


The bill includes the Budget estimate of $100,000 for this commission, $10,000 of which is for administrative expenses and $90,000 for expenses of moving various Government departments and bureaus. into new buildings that will become available during the next fiscal year.

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