Mr. DIRKSEN. What was the highest price up to May 27, 1941, or the middle of May 1941? What would be the peak price for used tonnage?

Admiral LAND. I do not know from memory.

LETTER OF ADMIRAL LAND TO COMPTROLLER GENERAL

Mr. DIRKSEN. I wonder if you could furnish for the record a copy of the letter you wrote to the Comptroller General asking for modification of his ruling?

Admiral LAND. Yes, sir.

(The letter referred to is as follows:)

Hon. LINDSAY C. WARREN,

Comptroller General of the United States.

DECEMBER 31, 1942.

DEAR MR. WARREN: In your letter of November 28, 1942, concerning the application of section 902 of the Merchant Marine Act, 1936, your answers to the questions contained in my letter of November 24, appear to be predicated upon the opinion that section 902 became operative on September 8, 1939, by reason of the President's proclamation of limited national emergency issued on that day. Your opinion that the limited national emergency "was such a state as was contemplated by section 902 (a) with respect to the requisitioning of vessels," and that "the conditions set out in said section 902 (a) as necessary for the lawful taking of a private vessel existed as of September 8, 1939," pervades and appears to control all of your conclusions.

A careful review of executive, legislative, and administrative action on and after September 8, 1939, indicates that such a conclusion is in conflict with the interpretation placed upon the proclamation by the Chief Executive, with various acts of Congress, and with explicit statements by Members of Congress, including the chairman of the Committee on Merchant Marine and Fisheries of the House of Representatives and other members of that committee.

In view of the importance of this question, the matters reviewed are set forth herein for your further consideration.

I. THE PROCLAMATION OF SEPTEMBER 8, 1939

The proclamation of September 8, 1939, which you have described as being "commonly known and spoken of as the proclamation of a limited national emergency," and which the President himself so characterized in his proclamation of unlimited national emergency dated May 27, 1941, reads as follows:

Whereas a proclamation issued by me on September 5, 1939, proclaimed the neutrality of the United States in the war now unhappily existing between certain nations; and

"Whereas this state of war imposes on the United States certain duties with respect to the proper observance, safeguarding, and enforcement of such neutrality, and the strengthening of the national defense within the limits of peacetime authorizations; and

"Whereas measures required at this time call for the exercise of only a limited number of the powers granted in a national emergency :

"Now, therefore, I, Franklin D. Roosevelt, President of the United States of America, do proclaim that a national emergency exists in connection with and to the extent necessary for the proper observance, safeguarding, and enforcing of the neutrality of the United States and the strengthening of our national defense within the limits of peacetime authorizations. Specific directions and authorizations will be given from time to time for carrying out these two purposes.”

Attention is invited to the terms of the proclamation itself, stating (1) that "measures required at this time call for the exercise of only a limited number of the powers granted in a national emergency,” and (2) that “specific directions and authorizations will be given from time to time for carrying out these two purposes" (i. e., neutrality and national defense).

The proclamation did not purport to be self-executing. As will more fully appear hereinafter, it was in fact supported by specific directions and authorizations in the only instances wherein it is known to have been effective.

The United States Maritime Commission received no direction or authorization during the entire period of the limited emergency (from September 8, 1939, to May 27, 1941), either as to section 902 of the Merchant Marine Act, 1936, as amended, or to section 37 of the Shipping Act of 1916, as amended (which is also operative "during any national emergency, the existence of which is declared by proclamation of the President"), or as to any law or duty within the scope of its administration.

II. EXECUTIVE ACTION

Following the issuance of the proclamation of limited national emergency of September 8, 1939, the President issued a series of Executive orders. Three of these orders, issued on the same day as the proclamation, referred to the proclamation in opening the premises upon which the President invoked certain statutory powers. Executive Order No. 8244 (4 F. R. 3863) authorized an increase in the strength of the Army. Executive Order No. 8245 (4 F. R. 3863) authorized increases in the enlisted strengths of the Navy and Marine Corps. Executive Order No. 8247 (4 F. R. 3864) authorized increases in the personnel of the Federal Bureau of Investigation of the Department of Justice. On September 18, 1939, the President issued Executive Order No. 8254 (4 F. R. 3983) authorizing increases in the personnel and facilities of the United States Coast Guard, Treasury Department. The opening premise in each of the four Executive orders above-cited is as follows:

"Whereas a proclamation issued by me on September 8, 1939, proclaimed that a national emergency exists in connection with and to the extent necessary for the proper observance, safeguarding, and enforcing of the neutrality of the United States and the strengthening of our national defense within the limits of peacetime authorizations."

On September 21, 1939, the President addressed a joint session of the Senate and the House of Representatives, convened in extraordinary session. In his address, the President said (see Congressional Record, vol. 85, pt. 1, pp. 11 and 12):

"In respect to our own defense, you are aware that I have issued a proclamation setting forth ‘a national emergency in connection with the observance, safeguarding, and enforcement of neutrality and the strengthening of the national defense within the limits of peacetime authorization.' This was done solely to make wholly constitutional and legal certain obviously necessary measures. have authorized increases in the personnel of the Army, Navy, Marine Corps, and Coast Guard, which will bring all four to a total still below peacetime strength as authorized by the Congress.

I

"I have authorized the State Department to use, for the repatriation of Americans caught in the war zone, $500,000 already authorized by the Congress.

"I have authorized the addition of 150 persons to the Department of Justice to be used in the protection of the United States against subversive foreign activities within our borders.

"At this time I ask for no other authority from the Congress. At this time I see no need for further Executive action under the proclamation of limited national emergency."

In connection with the President's use of Executive action, it is significant to note that statutory powers were invoked from time to time under specific findings of emergency in terms of the specific statutes invoked. For example, see Executive Order No. 8246 (4 F. R. 3863), dated September 8, 1939, making funds available for the protection of American citizens in foreign countries. This Executive order quoted the terms of the Department of State Appropriation Act, 1940 (53 Stat. 890), and contained a specific finding that “an emergency exists endangering the lives of American citizens in foreign countries within the meaning of the said act." Further illustrations are contained in Proclamation No. 2361, dated September 11, 1939 (4 F. R. 3889), suspending the operation of title II of the Sugar Act of 1937, and Proclamation No. 2378, dated December 26, 1939 (4 F. R. 4941), declaring that the emergency found in Proclamation No. 2361 had ceased and revoking the suspension order.

Another Executive order issued by the President on September 8, 1939, tends to emphasize the limited character of the national emergency declared by proclamation on that day. Executive Order No. 8248 (4 F. R. 3864), dated September 8, 1939, established the divisions of the Executive Office of the President and defined

*

(3)

*

their functions and duties. This Executive order was based upon the authority of the Reorganization Act of 1939, and provided in part as follows: "There shall be within the Executive Office of the President the following principal divisions, namely: (1) 4 (5) and (6) in the event of a national emergency, or threat of a national emergency, such office for emergency management as the President shall determine."

*

*, (2)

On May 25, 1940, the President issued an administrative order (5 F. R. 2109) establishing the Office for Emergency Management in the Executive Office of the President and prescribing regulations governing its activities. This administrative order opens with the premise "Whereas I find there is a threatened national emergency." The order then establishes the Office for Emergency Management and directs it to assist the President in the clearance of information with respect to the measures necessitated by the threatened emergency.

Further indication of meticulous care on the part of the Chief Executive in specifying the emergency powers invoked by him is contained in Proclamation No. 2412 (5 F. R. 2419), dated June 27, 1940. The purpose of this proclamation was to provide Executive consent to the exercise, with respect to foreign and domestic vessels, by the Secretary of the Treasury and the Governor of the Panama Canal, of powers conferred upon them by section 1 of title II of the act of Congress approved June 15, 1917 (40 Stat. 220; U. S. C., title 50, sec. 191), which provided as follows:

"SECTION 1. Whenever the President by proclamation or Executive order declares a national emergency to exist by reason of actual or threatened war, insurrection, or invasion, or disturbance or threatened disturbance of the international relations of the United States, the Secretary of the Treasury may make, subject to the approval of the President, rules and regulations governing the anchorage and movement of any vessel, foreign or domestic, in the territorial waters of the United States * *"

*

In order to establish the necessary consent, the President issued the proclamation cited above, reaffirming the proclamation of September 8, 1939, and further declaring "the existence of a national emergency by reason of threatened disturbance of the international relations of the United States." The opening premises of this proclamation, coming as late as June 1940, are believed to be particularly significant:

"Whereas a proclamation issued by me on September 8, 1939, proclaimed that a national emergency existed in connection with and to the extent necessary for the proper observance, safeguarding, and enforcing of the neutrality of the United States and the strengthening of our national defense within the limits of peacetime authorizations, and that specific directions and authorizations would be given from time to time for carrying out these two purposes; and

"Whereas the continuation of the conditions set forth in said proclamation of September 8, 1939, now calls for additional measures within the limits of peacetime authorizations."

Attention is drawn to the care with which this proclamation reiterates "that specific directions and authorizations would be given from time to time for carrying out" the proclamation of September 8, 1939, and to the further statement that conditions then existing called for additional measures under the terms of that proclamation.

In view of the facts (1) that the September 8, 1939, proclamation of limited national emergency expressly provided that specific directions and authorizations would be given for carrying out its purposes; (2) that specific directions and authorizations were contained in a series of Executive orders following the proclamation by hours or days; (3) that the President, in addressing the extraordinary session of Congress on September 21, 1939, reviewed the measures invoked by him and declared that there was no further need at that time for Executive action under the terms of the proclamation; (4) that other proclamations and Executive orders indicate a clear distinction between the limited emergency declared by the September 8 proclamation and a national emergency in the usual sense of the term (witness the references on September 8, 1939, and May 25, 1940, to the "threat of national emergency" and "threatened national emergency"); and (5) that in June 1940, the resident explicitly reaffirmed his intention to adhere to "specific directions and authorizations" for carrying out the purposes of the proclamation of September 8, 1939, it would 81710-43-47

appear that the absence of specific directions or authorization to the Maritime Commission with respect to the powers to be exercised by it "during any national emergency by proclamation of the President," as provided by section 902 of the Merchant Marine Act, 1936, as amended, and section 37 of the Shipping Act of 1916, was conclusive evidence that such powers had not been invoked.

III. ADMINISTRATIVE ACTION BY THE COMMISSION

In all of its administrative interpretations, the Maritime Commission has held to the view that the powers available to it in the event of a national emergency were no operative by virtue of the proclamation of September 8, 1939. At that time, two sections of the Merchant Marine Act, 1936, as amended, and one section of the Shipping Act of 1916 contained provisions which would have become operative by a proclamation of national emergency. Under the terms of section 902 (a) of the Merchant Marine Act, 1936, as amended, it is made lawful for the Commission to requisition vessels "whenever the President shall proclaim that the security of the national defense makes it advisable or during any national emergency declared by proclamation of the President." Section 510 (g) of the same act prohibits the use for commercial operation of any obsolete vessel acquired by the Commission or in its laid-up fleet (which vessel is or becomes 20 years old or more), except that any such vessel "may be used during any period in which vessels may be requisitioned under section 902 of this act." Under the terms of section 37 of the Shipping Act of 1916 certain types of sales, leases, mortgages, or charters of vessels automatically become unlawful and subject to severe criminal penalties "when the United States is at war or during any national emergency, the existence of which is declared by proclamation of the resident.”

The question as to section 37 of the Shipping Act of 1916 was twice considered and ruled upon by the General Counsel of the Maritime Commission. The two opinions were dated September 22, 1939, and January 9, 1941, respectively. In the first opinion, the General Counsel said:

**

It is true that the provisions of section 37 might be invoked by the proclamation by the President of any national emergency' without expressly referring to said law. However, by said proclamation and the subsequent specific directions issued pursuant thereto, it is believed the President has no definitely limited the extent of the national emergency therein proclaimed as to make clear that it was not intended by the President to apply to, and does not apply to, said section 37 of the Shipping Act, 1916, as amended."

The same position was taken regarding section 510 (g) of the Merchant Marine Act, 1936, as amended, as noted in the following excerpt from a letter addressed by the Chairman of the Maritime Commission to a member of the United States Senate under date of April 6, 1940. The purpose of the letter was to explain why the Maritime Commission was unable to sell its laid-up fleet in the absence of congressional action or a Presidential proclamation of unlimited national emergency:

"Reference is frequently made to the Commission's laid-up fleet of which there are about 109 cargo vessels of wartime construction. This fleet is primarily a war reserve' and action taken by the Congress in August 1939 sterilized this fleet insofar as vessels in the fleet are 20 years of age or older. There are at this time about 20 of these vessels which are not so sterilized as they have not yet reached the 20-year age limit. With the exception of these 20, action by the Commission is restricted by statute except as outlined in the Merchant Marine Act, of 1936, as amended, particularly inviting attention to section 902 which requires a Presidential proclamation to release this fleet as outlined in this section. Any other general action with regard to the release of this fleet would require congressional authority."

With respect to section 902 (a), the Commission's interpretation of the effect of the September 8 proclamation was likewise reported to the Congress when the Commission on April 16, 1941, filed a report with the Committee on Merchant Marine and Fisheries of the House of Representatives in support of Congressman Oliver's bill (H. R. 4088) which was intended to grant the Commission power to purchase and charter vessels, a power that would have been in existence if section 902 (a) had been operative under the September 8 proclamation. This report said in part (see H. Rept. No. 440, 77th Cong., 1st sess., p. 9):

"Under existing law, the Commission is not authorized to procure vessels by charter. Under title VII of the Merchant Marine Act, 1936, as amended, the Commission may charter out vessels owned by the Commission, under certain conditions and for use in essential trade routes, and may operate certain of its vessels under specified conditions when it is unable to sell or charter them for operation in essential trade routes. The Commission has a limited authority to purchase vessels (constructed in the United States) under section 215 of the Merchant Marine Act, 1936, as amended, for use on essential trade routes. The Commission would have authority to acquire and operate vessels owned by United States citizens under section 902, as amended, of the 1936 act, but this section is not operative until the President proclaims that a national emergency exists or that the security of the national defense makes advisable the requisition or purchase of such vessels."

In its administrative actions the Maritime Commission has consistently followed the interpretation that its emergency powers did not become operative under the proclamation of September 8, 1939. These actions were taken in the usual course of business. They bore no relation to any controversy. On the contrary, the Commission, on more than one occasion, reported the situation to the committees of Congress in support of supplementary authority with which to meet the needs of changing conditions.

IV. LEGISLATIVE ACTION

The action of Congress in shaping and adopting further enabling legislation relating to the merchant marine, and the approval by the President of such laws are believed to be further evidence of the correctness of the Commission's view that section 902 did not become operative under the proclamation of September 8, 1939. Cited herein are certain steps in the development of the following laws: (1) Public Resolution No. 74, approved May 14, 1940; (2) Public Law No. 101, approved June 6, 1941; and (3) Public Law No. 173, approved July 14, 1941.

A. Public Resolution No. 74.

As heretofore noted, the laid-up fleet had been sterilized by the provisions of section 510 (g) of the Merchant Marine Act, 1936, as amended. (The exact provisions of this subsection are set forth hereinafter as part of another quotation.) Although this provision became law by the act of August 4, 1939, events following the outbreak of war led to a demand within less than a year thereafter for the Commission to place the laid-up fleet in operation. Section 510 (g) authorized the use of the laid-up fleet "during any period in which vessels may be requisitioned under section 902," but the Commission had taken the position that section 902 was not operative, and that section 510 (g) was therefore still in effect, as indicated in the letter from the Chairman of the Maritime Commission to a Member of the United States Senate, dated April 6, 1940, hereinabove quoted.

On April 9, 1940, Mr. Buck, of California, introduced in the House of Representatives House Joint Resolution 509, reading as follows:

"Resolved by the Senate and House of Representatives of the United States of America in Congress assembled, That section 510 (g) of the Merchant Marine Act, 1936, as amended (restricting the use of vessels in the laid-up fleet of the Maritime Commission), is hereby suspended until the proclamation heretofore issued by the President under section 1 (a) of the Neutrality Act of 1939 is revoked."

Thereafter, Mr. Buck explained the joint resolution to the Committee on the Merchant Marine and Fisheries of the House of Representatives in the following language:

"The purpose of the resolution which I originally introduced was to repeal section 510 (g) of the Merchant Marine Act of 1936, as amended, which provides as follows, and for the information of the committee I should like to read that subsection:

"(g) An obsolete vessel acquired by the Commission under this section which is or becomes 20 years old or more, and vessels presently in the Commission's laid-up fleet which are or become 20 years old or more, shall in no case be used for commercial operation, except that any such obsolete vessel, or any such vessel in the laid-up fleet may be used during any period in which vessels may be requisitioned under section 902 of this act, as amended, and except as other