Herbert Hoover: The Man and His Work

by Vernon L. Kellogg

We shall yet be faced with the question of demobilizing a considerable part of this fleet into private hands, or frankly acknowledging that we operate it for other reasons than interest on our investment. In this whole problem there are the most difficult considerations requiring the best business thought in the country. In the first instance, our national progress requires that we retain a large fleet under our flag to protect our national commercial expansion overseas. Secondly, we may find it desirable to hold a considerable government fleet to build up trade routes in expansion of our trade, even at some loss in operation. Thirdly, in order to create this fleet, we have built up an enormous ship-building industry. Fifty per cent of the capacity of our ship yards will more than provide any necessary construction for American account. Therefore there is a need of obtaining foreign orders, or the re

duction of capacity, or both. I believe, with most engineers, that, with our skill in repetition manufacture, we can compete with any ship builders in the world and maintain our American wage standards; but this repetition manufacture implies a constant flow of orders. It would seem highly desirable, in order to maintain the most efficient yards until they can establish themselves firmly in the world's industrial fabric, that the Government should continue to let some ship construction contracts to the lowest bidders, these contracts to supplement private building in such a way as to maintain the continuous operation of the most economical yards and the steady employment of our large number of skilled workers engaged therein.

When we consider giving orders for new ships, we must at the same time consider the sale of ships, as we cannot go on increasing this fleet. When we consider sale, we are confronted with the fact that our present ships were built under expensive conditions of war, costing from three to four times per ton the pre-war amount, and that already any merchant, subject to the long time of delivery, can build a ship for seventy-five per cent of their cost. It would at least seem good national policy to sell ships today for the price we can

contract for delivery a year or two hence, thus making the government a reservoir for continuous construction.

We could thus stabilize building industry to some degree and also bring the American-owned fleet into better balance, if each time that the government sold three or four emergency constructed cargo vessels it gave an order for one ship of a better and faster type. This would make reduction in our ship-building steadier and would give the country the type of ships we need.

Our joint engineering committees have examined with a great deal of care into the organization of and our expenditure on public works and technical services. These committees have consistently and strongly urged the appalling inefficiency in the government organization of these matters. They report to you that the annual expenditure on such works and services now amounts to over $250,000,000 per annum, and that they are carried out today in nine different governmental departments. They report that there is a great waste by lack of national policy of coördination, in overlapping with different departments, in competition with each other in the purchase of supplies and materials, and in the support of many engineering staffs.

They recommend the solution that almost every civilized government has long since adopted, that is, the coördination of these measures into one department under which all such undertakings should be conducted and controlled. As a measure practical to our government, they have advocated that all such bureaus should be transferred to the Interior Department, and all the bureaus not relating to those matters should be transferred from the Interior to other departments. The Committee concludes that no properly organized and directed saving in public works can be made until such a re-grouping and consolidation is carried out, and that all of the cheeseparing that normally goes on in the honest effort of Congressional committees to control departmental expenditure is but a tithe of that which could be effected if there were some concentration of administration along the lines long since demonstrated as necessary to the success of private business.

Another matter of government organization to which our engineers have given adhesion is in the matter of the national budget. To minds charged with the primary necessity of advance planning, coördination, provision of synchronizing parts in organization, the whole notion of our hit-or-miss system is repugnant. A bud

get system is not the remedy for all administrative ills, but it provides a basis of organization that at least does not paralyze administrative efficiency as our system does today. Through it, the coördination of expenditure in government department, the prevention of waste and overlapping in government bureaus, the exposure of the "pork barrel," and the balancing of the relative importance of different national activities in the allocation of our national income can all be greatly promoted. Legislation would also be expedited. No budget that does not cover all government expenditure is worth enactment. Furthermore, without such reorganization as the grouping of construction departments, the proper formulation of a budget would be hopeless. The budget system in some form is so nearly universal in civilized governments and in completely conducted business enterprise, and has been adopted in thirty of our States, that its absence in our federal government is most extraordinary. It is, however, but a further testimony that it is always a far cry of our citizens from the efficiency in their business to interest in the efficiency of their government.