Part 47

Now do you think it is any different in connection with the independent jurisdiction of these Government Departments, from the independent services of the Army?

They talked in the past about Interdepartmental Boards, to correct this old chaos, when they had no Executive leadership. An effort was made from time to time by Interdepartmental Boards, acting as a committee without relinquishment of the independent authority represented to undertake some of these reforms, the necessity of which everybody saw. Nothing was ever done to amount to anything. Why? They would meet together and talk and outline the situation and necessity for action until some question came up where somebody was going to lose control of something or a part of his jurisdiction by some coordinated action for the benefit of the whole Government. Then immediately the whole thing died out and nothing was accomplished practically by any Interdepartmental Board, where anything vital had to be given up by one of the independent members of it, whose jurisdiction and power would be cut down in the interest of the common plan of the Government.

When the President of the United States assumed this central control of routine business, he did what any man would do in connection with a private corporation; he called together in conference the business administration,—everybody connected with the business of the Government as head of department or independent establishment—Cabinet Officers correspond to Vice Presidents in a business corporation. Of necessity they had allowed this disgraceful system of chaos and extravagance to go on. It was not their fault any more than it is the fault of you gentlemen, who have been running along independent lines, because you were not joined together in a system operating under a central authority. We all were properly subject to the indictment of loose business methods because the President of the United States had not imposed a unified plan and system over us nor had he created the machinery by which this plan would be carried into effect, as he has since done.

In connection with surplus supplies, every department formerly was selling its supplies in the open-market, and other departments were buying the same kind of supplies in open market. In a number of cases speculators would come and buy our public sales material from one department to sell it to another department at two or three times the price. Real estate was being leased in cities right along from private owners, when the Government had vacant property to rent. This was the custom also in connection with motor transport. If any Department wanted something moved and did not have motor transport, it would go out and hire motor transportation. There was no machinery by which the empty motor trucks and idle men of the other departments could be used.

When goods were to be shipped, everybody would route them as they pleased. There was no unified central authority which could deal with the services as a whole as regards the classification of freight and the whole transportation question.

The same thing existed in the making of contracts.

The same thing existed in Government purchasing. There was competition between the Departments, the Departments themselves not being coordinated. In the Treasury Department alone we found 18 separate points of purchasing activity. Everything was run in Government business as if it was composed of 41 separate corporations. How were things changed for the better? It is all simple enough. It all depended on the President because he alone had the authority to impose the methods of coordinating and controlling this great general business, just as he is coordinating these great activities here today through this Board, presided over by his appointee, General Sawyer, a co-ordinator.

The plan which the President adopted was simple enough,—just what would be done in any business organization—without asking for any additional legislation for additional employees, but by simply taking from the body of the employees, officials of the United States, those men especially qualified by knowledge and experience to act as his agents, and then creating the machinery through which they could transmit his policy and plan of unified business to the general organization.

It is the simplest thing in the world, and the only possible objection I have ever heard was urged the other day where it was said that the detail of Army and Navy Officers for this central work by the President might not result in giving him the benefit of absolute impartiality of judgment because of their former connection with the War and Navy departments. That nonsense!

For instance, in my bank,—supposing I wanted to take a man from the Discount Department, from the Foreign Exchange Department, or the Real Estate Department,—what folly to say that I would be justly afraid that he would not be my loyal and faithful agent in the imposition of a plan for the interest of the institution as a whole because of his former connection with those departments of the bank. What folly to say that the President of the United States with all his power over personnel can not receive from men detailed for co-ordinating work the same loyalty as he would receive from men appointed from the outside to come into this complex machine. And I say now that the plan must stand or fall upon that proposition. Regarding Colonel Smither, the Chief Coordinator, or Commander Stanley, or any of these men who have been connected with the Army or Navy,—so far as this work is concerned, as agents for the President of the United States, they are as independent as if they had never been in the Army or Navy. If anybody thinks they are not, let us give him an example. We have not found anything but cooperation from the heads of these departments and the heads of these services because their personal interests lie parallel now with the unified plan of the government since the President of the United States to whom they are responsible, is behind that plan.

If the President becomes indifferent,—if he loses his eyes, and ears and fingers in matters of routine business in the shape of the Chief Coordinators of the Boards,—if he lets them drift, immediately there will come the effort from you and everybody else to pull to pieces this coordinating machinery which alone is able to impose a unified plan upon the governmental business.

Now why is it necessary for you to accept, without mental reservation, the necessity of the existence of this coordinating board under which you act and the authority of the Chief Coordinator of that board as representing the President? Let me say in connection with this that the rights of the independent departments and establishments are jealously regarded under these executive orders.

What I want to impress upon the minds of all is the necessity of these co-ordinating boards to enable you to do your work properly.

Take it in ships. In coordinating shipping transportation, you have got to have Mr. Weeks, Mr. Denby and Mr. Lasker in contact in connection with a decision involving the economical use of ships. How can anybody get them together without the authority of the President? Suppose I was expected to call them together without the authority of the President. I would go to Mr. Weeks for example and wait until the Senators were through seeing him, and then perhaps because of his personal friendship persuade him to go over with me to see Mr. Denby. When we had seen Denby how could we get the two together with Lasker? You could not get anywhere in this co-ordinating work without a delegated authority from the President to compel contact between high officials.

In connection with this great work of yours in which you spent last year three-fourths of a billion dollars, you cannot have it run right without the existence of this co-ordinating Board,—without that authority to make a bird’s-eye view of the whole situation,—without that authority to say why this building, for example, is unnecessary, because there exists a superfluity of this sort of building in another department. What’s the use of endeavoring to catalogue those activities in which there is duplication, in which you have got to have the bird’s-eye view, and would never get proper action taken, unless you have in existence this Board created by the authority of the President!

In connection with the rights of your department, for instance, there is preserved for you at all times in connection with the coordinating order of the Federal Board of Hospitalization, a right of appeal to the President of the United States. If this Coordinating Board interferes to such an extent with the plans of your unit that you think the disadvantage so great that it counterbalances the beneficial effect to the government as a whole, the right of appeal to the President is with you. But for the first time in the government, as you know, there will be presented to the President by the Chief Coordinator the interests of the government treated from the standpoint of the Coordinating Board, so that the President of the United States in making his decision on your matter has the strongest possible statement of the needs of the unit from you, and the strongest possible statement of the needs of the government as a whole from the President of the Board. But the final authority, of course, is in the President of the United States and he will exercise it. In all of these orders the right of the head of the independent unit to a proper examination, by the supreme authority, of his plan is preserved, and it has been so in connection with all of these coordinating agencies and with the Director of the Budget.

Let me tell you something as to the spirit of cooperation shown. I have never had a contest before the President with a cabinet officer or head of a department in connection with a coordinating action. I have never had one for this reason. Take in connection with the transfer of ships,—we have independent agencies for the examination of conditions. We have the right, as agents of the President, of obtaining information from any bureau chief or head of a department.

We have, through Colonel Smither’s wonderful organization of course, the means for securing essential knowledge about these things.

Regarding ships,—we asked the Navy the other day for a couple of mine sweepers for the Coast and Geodetic Survey. They refused. That was always the case in the old days. Of course, everybody looks out for the interest of his own department. Well I called over one of the Assistant Secretaries of the Navy, and gave him a bird’s-eye view of the situation.

They had 49 mine sweepers; and they were going out of commission. If they went to the Coast and Geodetic Survey, they would be kept in commission and would not deteriorate so rapidly. What is more, if they didn’t go to the Geodetic Survey, the United States would have to ask for a million dollars to build new ships.

That matter was taken back and proper attention given to it with this knowledge of the whole situation and the Secretary of the Navy joined in the request that the ships be transferred.

It was not the Secretary of the Navy who had really been responsible for the first decision. It was some fellow along down the line, without the bird’s-eye view, who has been safe for a hundred years from the eye of a central authority, thinking in terms of the whole government—doing what he believed his duty, I admit, in directing things for the best interests of his unit, but who, without the bird’s-eye view would have thrown the Government into an unnecessary expense of a million dollars.

It then developed when the Coast and Geodetic Survey people went to get the mine sweepers, that they were in process of repair; that the engines were disassembled. Now the Coast and Geodetic Survey had no appropriation available for repairing work and so the Navy said, “We won’t spend our money on those ships.”

“Why?”

“Because the President of the United States told us to be economical.”

Now supposing there had not been in existence an agency acting under the President, such as the one here presided over by General Sawyer which could see what was really involved in that action on the part of the head of that subordinate unit of the Navy. Because the Navy wanted to save a repair bill of $10,240.00 the Government would have spent unnecessarily $1,000,000 for new ships. Do not think that was an unusual case! It was almost always so in the old days.

Now nobody has been more anxious than the Secretary of the Navy to cooperate in those matters but he must have information,—and you must have the information,—to enable one to cooperate. All that was necessary for me to do was to write to the Secretary of the Navy, that unless these ships were repaired out of the Navy appropriation at a cost of $10,240 we would have had to ask for a million dollars appropriation for new ships. But what if that information had not been given?

The existence of these agencies is necessary to enable this Government to be run on a business basis. I have given you a simple illustration in connection with the ships. We transferred thirteen ships with the acquiescence of the heads of the departments concerned by simply developing the bird’s-eye view of the situation without ever taking the matter up with the President, except for the issuance of the Executive order by agreement.