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-25 October 15, 19b3« Dear Miss Perkins: As the suggestion was made at the meeting on Thursday with Mr* Justice Byrnes that I send to those present copies of the material I had furnished to him on the reconversion problem, X am enolosing for your information the two documents. One, as the covering letter indicates, wai prepared by a conaittee representing the Board of Governors and the Conference of Reserve Bank Presidents• the other was issued by the Automotive Council tor War Production and, as you will note, nas not for publication* Sincerely yours, Miss Frances Perkins, Secretary of Labor, Washington 25, D. G. Enclosures 2 Identical letter sent to: Messrs. Knox, Crowley, Bell, George L. Harrison, C. E. Wilson (TIVPB), Coy, Biddle, Ickes, Jesse Jones, Baruch and Judge Rosenman, With Contraots and Finance Bulletin #56 AUTOMOTIVE COUNCIL R)R WAR PRODUCTION New Center Building, Detroit, Michigan October 13, 19U3 Hon. Lindsay C. Warren, Comptroller General of the United States, General Accounting Office, Washington, D. C, Dear Mr. Warren: We appreciate the opportunity you afforded us this morning to lay before you our viewpoint on the important problem of the procedures which are to govern the termination of war contracts, and -tiie consequent settlements to be worked out. This matter, we understand, is currently receiving the consideration of your office, of the several military services of the Government, and of the Congress. We are aware, in a general way, of the controversial aspects of this situation, and we are deeply concerned that a correct solution be arrived at promptly. We suggest the public interest demands that after adequate investigation settlements of war contracts, final and binding on all parties, shall be made on a basis that is fair and equitable, Tho Government interest, of course, requires that settlement commitments of its representatives may subsequently be subject to some sort of audit as a protection against fraud, a function which your office has customarily performed in the past. It does not soem feasible, in our opinion, to subject tho business judgment used by government representatives in effecting settlements to audit or review without injecting into the settlement an intolerable element of uncertainty. It is paramount in the public interest that these settlements bo arrived at promptly, and that in the absonce of fraud, tho settlements reached be final and conclusive, if tho reconversion of industry to civilian peacetime pursuits is to be accomplished without a concomitant period of industrie.1 stagnation comparable to that prevailing in tho depths of the worst depressions this country has ever exporioncod. Our experience with General Accounting Office audit procedures now in effect is tho basis for our opinion that if they wore to be generally applied to a problom of tho magnitude which will be created by tho contract terminations at the end of this war, they would constitute an insuperable obstacles to the rosumption of wido scalo industrial activity within roasonablo time. Our call upon you this morning was for tho purpose of registering this opinion with you. Wo recognize and support the essential function which your office performs, but if it is to be exercised over tho ontiro range of war contract terminations* adaptation of the agonoyfs administration to a basis which will deal succossfully with audit problems of the magnitude now confronting us is essential if this country is to escape a more or loss prolonged portod of economic chaos at the end of the warf Hon» Lindaay C. Warren t Page 2 We appreciate the sympathetic consideration you indicated you were prepared to give to our concerns, whith are intensely practical. Our shops, and the shops of the multitude of suppliers serving us in our war efforts, must be promptly cleared of government materials and facilities, and final financial settlements must be effected without delay, before civilian industrial aativity can be resumed. It is not our purpose in this letter to deal in any detail with this enormously complicated subject, but we do most earnestly urge its importance upon you, and upon all other branches of the Government who bear the responsibility of dealing with one aspect or another of it. Such practical experience as we have had in handling business problems of this sort continues to be at the service; of your office and all other Govern^ mental agencies interested in this probiom. We are confident if all parties at interest, governmental as well as industrial, apply themselves to this problem, the correct solution will be found. Very truly yours, (Signed) Jas. H. Marks E, R.T Breech K. J, Asmersiftn Vf. F» Armstrong B. E, Hutchinson Members Contract Termination Committee
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