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__C44th1__
ANNUAL

REPORT
of the Secretary
of Commerce

U. S. DEPARTM ENT
OF COMMERCE

1956

A */
H i

44 th A N N UA L

REPORT
of the Secretary
of Commerce

U N ITED STATES
GOVERNM ENT P R IN T IN G OFFICE
W ASHINGTON : 1956

U. S. DEPARTMENT OF COMMERCE
Creation and Significance
The Department of Commerce was designated as such by the
act of Mar. 4, 1913 (37 Stat. 736; 5 U. S. C. 611), which
reorganized the Department of Commerce and Labor, created by
the act of Feb. 14, 1903 (32 Stat. 826; 5 U. S. C. 591), by
transferring out of the former department all labor activities.
The Department seal of blue and gold is crested by the American
bald eagle denoting the national scope of the Department’s
activities; the ship symbolizes commerce; the lighthouse repre
sents guidance from the darkness, translated as commercial
enlightenment; the blue denotes uprightness and constancy; and
the gold denotes purity.
The statutory functions of the Department are to foster, promote,
and develop the foreign and domestic commerce, manufacturing,
shipping, and transportation facilities of the United States. Re
lated functions subsequently have been assigned to or removed
from the Department from time to time by legislation or Executive
order; however, the purposes have remained substantially the
same as those for which the Department was established.

For sale by the Superintendent of Documents, U. S. Government Printing
Office, Washington 25, D. C. Price 30 cents

CONTENTS
O rganization Chart______________________________________
O fficials of the D epartment--------------------------------------------T ransmittal and Statement by the Secretary of C ommerce.
Review of the National Economy_________________________
United States Foreign Trade Developments________________
I mmediate O ffice of the Secretary-----------------------------------Business Advisory Council-----------------------------------------------Office of the General Counsel____________________________
Office of Public Information_____________________________
Office of Strategic Information___________________________
O ffice of the Assistant Secretary for Administration_____
Office of Administrative Operations_______________________
Appeals Board_________________________________________
Office of Budget and Management------------------------------------Office of Personnel Management__________________________
Office of Publications___________________________________
O ffice of the U nder Secretary__________________________
Coast and Geodetic Survey_______________________________
Patent Office___________________________________________
National Bureau of Standards____________________________
O ffice of the U nder Secretary for T ransportation_______
Civil Aeronautics Administration__________________________
Defense Air Transportation Administration-------------------------Maritime Administration------------------------------------------------Bureau of Public Roads__________________________________
Weather Bureau________________________________________
O ffice of the Assistant Secretary for I nternational Affairs.
Bureau of Foreign Commerce--------------------Office of International Trade Fairs-----------------------------------O ffice of the Assistant Secretary for D omestic Affairs----Business and Defense Services Administration_______________
Office of Area Development__________________________
Office of Field Services_______________________________
Office of Technical Services___________________________
Office of Business Economics_____________________________
Bureau of the Census____________________________________
I nland W aterways Corporation---------------Appendix: O rganization and P rogram Chronology________
Secretaries of Commerce From 1903 to Present_____________
in

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ORGANIZATION OF THE U. S. DEPARTMENT OF COMMERCE

OFFICIALS OF THE DEPARTMENT
A s of June 30,1956

Secretary of Commerce___________________ Sinclair Weeks
Special Assistant______________________ B. Allen R owland
Special Assistant______________________ William S. K ilborne
Under Secretary of Commerce_____________ Walter Williams
Under Secretary of Commerce for Transporta
tion ------------------------------------------------ Louis S. R othschild
Deputy Under Secretary of Commerce for
Transportation---------------------------------- T homas B. Wilson
Assistant Secretary of Commerce for Adminis
tration------------------------------------------ ---George T. M oore
Director, Office of Administrative Opera
tions ----------------------------------------------- William M. M artin
Director, Agency Inspection Staff________ Griswold F orbes
Chairman, Appeals Board______________ F rederic W. O lm stead
Director, Office of Budget and Manage
ment ----------------------------------------------- O scar H. N ielson
Emergency Planning Coordinator________ E rnest V. H olmes
Director, Office of Personnel Management_Carlton H ayward
Director, Office of Publications__________ D onald R. Burgess
Security Control Officer________________ J ohn W. P hillips
Assistant Secretary of Commerce for Interna
tional Affairs------------------------------------ H. C. M cClellan
Deputy Assistant Secretary of Commerce for
International Affairs--------------------------- M arshall M. Smith
Assistant Secretary of Commerce for Domestic
Affairs--------------------------------------------- F rederick H. M ueller
Deputy Assistant Secretary of Commerce for
Domestic Affairs____________________ Carl F. O echsle
General Counsel________________________ P hilip A. R ay
Director of Public Information____________ Albert N. L eman
Director, Office of Strategic Information____ Erwin Seago
Heads of Bureaus and Offices Reporting to—
Under Secretary of C ommerce:
Director, Coast and Geodetic Survey_____ H. Arnold K aro
Commissioner, Patent Office____________ R obert C. Watson
Director, National Bureau of Standards___ A. V. Astin
V

U n d e r S e c r e t a r y o f C o m m e r c e f o r T r a n s p o r t a t io n :

Administrator, Civil Aeronautics Adminis
tration______________________________ C. J. L owen
Administrator, Defense Air Transportation
Administration______________________ T heodore H ardeen, J r.
Chairman, Federal Maritime Board---------- Clarence G. M orse
Administrator, Maritime Administration----Clarence G. M orse
Commissioner, Bureau of Public Roads----- C. D. C urtiss
Chief, Weather Bureau_________________ F. W. R eichelderfer
A ssistant Secretary of C ommerce for I nternational Affairs:
Director, Bureau of Foreign Commerce----- L oring K. M acy
Director, Office of International Trade
Fairs_______________________________ H arrison T. M cClung
A ssistant Secretary of C ommerce for D omestic Affairs:
Administrator, Business and Defense Serv
ices Administration________________ C harles F. H oneywell
Director, Area Development__________ V ictor R oterus
Director, Office of Field Services------------ G uy E. Wyatt
Director, Office of Technical Services___ J ohn C. Green
Director, Office of Business Economics-------M. J oseph M eehan
Director, Bureau of the Census__________ R obert W. Burgess
vi

44th ANNUAL REPORT OF THE SECRETARY
OF COMMERCE

Transmittal and Statement
D epartment of C ommerce,
O ffice of the Secretary,

Washington, December 31, 1956.

5irs :
I have the honor to report to you the services and information provided to
industry and business by the Department of Commerce during the fiscal year
ended June 30, 1956.
The Department’s programs were broadened and expanded to meet the
changing needs of the Nation’s industry and business, thereby contributing
to the increases in production, employment, and wages.
Responsive to nationwide needs for improved highway transport serving
commerce, industry, and defense, the Bureau of Public Roads engaged in a
wide range of engineering, administrative, and research activities designed
to aid the States in planning and developing adequate highway systems.
During the year $687 million of Federal funds was used to construct 23,800
miles of highways. The Bureau also had a significant part in shaping the
greatest roadbuilding program in history as provided in the Federal-Aid
Highway Act of 1956.
During the past year we continued to promote the development of a pro
gressive, modern, and efficient United States merchant fleet as well as the
maintenance of this fleet and the shipbuilding and ship repair facilities at
the level required to meet the Nation’s needs in the event of a national
emergency. The tangible results included the inauguration of the largest
peacetime shipbuilding program in history; substantial progress in establish
ing a plan for the “phasing” of new ship construction and ship replacements
to avoid block obsolescence and to assure the retention of a nucleus of
construction know-how; continued progress in the completion of new designs
and propulsion systems for new ships; further development of designs and
plans for the modernization of war-built ships in the National Defense
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ANN U A L REPO R T OF T H E SECR ETA RY O F COM M ERCE

Reserve Fleet, including experimental conversion of four Liberty ships; and
completion of the emergency ship repair program under which we achieved
a material improvement in the ready availability of some 150 of these ships
for use in the event of emergency.
To meet both the rising tide of aircraft movements and the expected
introduction of commercial jets by 1959, the Civil Aeronautics Adminis
tration of the Department has taken preparatory steps toward vastly ex
panding the air navigation and traffic control system—a program which
necessarily will continue at a high level over a period of years. A greatly
enlarged program of aid to communities in the improvement of airports,
also an important part of Federal and community planning for the future
of aviation, was carried on during the year.
We continued our program of surveying and charting for the promotion
of marine and air commerce and for engineering use. A major accom
plishment was the completion of the adjustment of the northern Alaska
triangulation, thus placing all of our triangulation from Point Barrow to
Key West on the same datum. Over 43 million nautical and aeronautical
charts were distributed during the year.
The Weather Bureau started a 4-year program of modernizing meteoro
logical equipment and strengthened its forecast and warning services
through improved communications.
A new method of weather prediction by an electronic digital computer
had its first full-scale operating tests during 1956. Although still in experi
mental stages, forecasting by computer holds promise of becoming the most
revolutionary single development in meteorology in a century. An ex
panded and much more comprehensive research program was begun for
the study of hurricanes, tornadoes, and other severe storms. Other sig
nificant accomplishments during the year include: The design and develop
ment of special storm detection radar equipment; improved airport runway
visibility and cloud-height observations for greater safety in landing air
craft at many of the busier airports; and establishment of new flood fore
casting and warning centers at Hartford, Conn., and Augusta, Ga.
The National Bureau of Standards made significant progress in the de
velopment of new and better standards of physical measurement. Espe
cially noteworthy is the productive research carried out in the fields of
radiation protection and radio propagation. The Bureau is placing in
creased and strong emphasis on basic research leading to standards of
measurement in the newer fields of science and technology.
In a year in which the gross national product reached an annual rate
above $400 billion for the first time in the Nation’s history, the Department’s
Office of Business Economics supplied an increasing flow of timely facts on
our changing economy. Its reports on businessmen’s anticipated outlays
for new plant and equipment pointed to a 1956 expenditure of $35 billion,
a fact which both reflected and inspired confidence in continued growth.

ANN U A L R EPO R T OF T H E SECRETA RY OF COM M ERCE

We expanded our program of collecting technical reports growing out
of the $2^2 billion worth of research conducted annually for the Govern
ment and making them available to the Nation’s scientific and industrial
laboratories and business enterprises. Our acquisition efforts were broad
ened to include the work of more Government agencies. Several thousand
AEC reports were turned over to us, thus increasing the amount of infor
mation we have readily available to business in the peaceful development
of the atom. The total volume of our sales of Government research reports
to science and industry, at an average price of $1.50 to $2.00 per report,
representing the cost of printing and handling, increased from $191,000 for
the previous year to just over $245,000.
The Department strengthened and improved its mobilization prepared
ness programs for industry, including the aircraft and shipping segments,
and continued its service to the business community in Governmentindustrial relationship.
Highlights of Office of Area Development activities were the sub
stantially increased technical assistance services made available to com
munity development groups. More than 400 communities were assisted
in developing new job opportunities through industrial and area develop
ment programs. In recognition of the growing demand for area develop
ment services by community groups, Congress increased the budget of the
Office from $120,000 to $370,000 for fiscal 1957.
Maximum constructive use was made of the increased resources provided
by the Congress for operation of the Patent Office in 1956, with the result
that the patent application backlog was reduced during the year despite
heavy receipts of new applications. Plans for achieving a current work
level of about 100,000 applications were formulated and embodied in an
8-year backlog reduction program. Conduct of Patent Office activities on
this basis was supported by the Congress in acting on the request for funds
to implement the first year of the program. Trademark registration by
the Patent Office reached a new peak in 1956 and continued increases in
the number of new applications received for trademark registration
reflected the sustained vigor and upswing of our business economy.
Publications of the 1954 Censuses of Business, Manufactures, Mineral
Industries, and Agriculture, beginning in fiscal 1956 and to be completed
in fiscal 1957, provide a comprehensive and detailed inventory of the
Nation’s recent economic growth and achievements. Supplementing the
benchmark data of these major censuses, the current statistics programs of
the Bureau of the Census highlight continuing expansion and changes in
the more important social and economic phases of our national life.
We continued to assist in the development of United States policies
affecting international trade, travel, and investment in cooperation with
the other agencies of Government. We participated in the successful
tariff negotiations at Geneva under the auspices of the General Agreement
407217- 57-

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ANN U A L REPO R T O F T H E SECR ETA RY OF COM M ERCE

on Tariffs and Trade and accomplished much of the preparatory work
incident to negotiation of treaties to facilitate the international trade of
the United States with eight countries. Additional emphasis was placed
upon increasing the services of the Department to business firms engaged in
international trade, travel, and investment. Controls over the export of
nonstrategic or peaceful goods were relaxed while improvements were
made in the controls of strategic goods. Items in short supply in the United
States were controlled at a minimum level consistent with the Nation’s
needs and foreign obligations.
The United States participated in 18 international trade fairs under a
program administered by the Office of International Trade Fairs. Over
11.5 million visitors viewed joint Government-industry exhibits portraying
the products and benefits of the American free enterprise system.
Following a general description of the condition of our national economy
and developments in foreign trade, there is attached a full report of the
Department’s accomplishments and expenditures for fiscal 1956.

Secretary of Commerce.

T he President of the Senate.
T he Speaker of the H ouse of Representatives.

REVIEW OF THE NATIONAL ECONOMY
The national income and product attained new heights in the 1956 fiscal
year as the productive resources of the economy were employed on a gen
erally expanding scale. The $400-billion mark in the annual rate of gross
national product was reached and passed in the middle of the year. For the
fiscal period, as a whole, national product aggregated $403 billion, a gain
of 8 percent over the preceding year; in the concluding April-June quarter,
it stood at $408 billion. Of the total increase, the bulk represented addi
tional real output and the smaller remaining portion was attributable to
higher prices.
Consumer prices averaged about the same as in fiscal 1955, while whole
sale prices were up 2 percent. Pressure on the price level was increasing
at year end.
The main impetus underlying the continued economic expansion came
from consumer buying, other than automotive, and from expanding busi
ness investment in plant and equipment. With the exception of residential
building, demand was strong for all types of business investment, especially
for producers’ goods. There was also an appreciable rise in our exports
of goods and services. Government purchases of goods and services in
creased somewhat, ascribable to the advance in State and local activities.

ANNUAL REPO R T O F T H E SECR ETA RY OF COM M ERCE

National Income and Employment

The national income was also larger in the 1956 fiscal period, amounting
to $334 billion, a rise of $25 billion and of the same proportion as the expan
sion in output. The largest part of this increase, $19 billion, was distributed
as compensation to employees, a 9-percent rise. Corporate profits also
advanced substantially, while proprietors’ and rental income showed little
change in the aggregate as higher rental income of persons and higher
earnings of business and professional proprietors were largely offset by
lower farm income.
The flow of current purchasing power as measured by personal income
after deducting personal tax liabilities, was up 7 percent. This was a major
factor in the advance in retail sales.
Employment followed a rising trend with the June 1956 aggregate of
66 J/2 million persons standing 2% million above the corresponding 1955
month. The yearly average was 4 J/2 percent above fiscal 1955, with most
of the increase in nonagricultural employment. Unemployment was sub
stantially reduced. Employment in manufacturing establishments regis
tered only a small increase between June 1955 and June 1956 because of
the reduced output in the automobile industry and some of its supplying
industries. Expansion was rather general among nonmanufacturing in
dustries, especially in trade.

New Plant and Equipment

A feature of the 1956 fiscal period was the unprecedented $32-billion out
lay for new plant and equipment, an increase of more than one-fifth over
1955. Most major industry groups participated in this capital expansion,
which reflected not only the expanding demands for goods but also a high
rate of technological progress. Durable goods manufacturing industries
showed especially large relative increases, particularly the primary metal
industries. Among the nondurable goods industries, paper and allied prod
ucts registered a large expansion. Railroad capital expansion was particu
larly marked among the nonmanufacturing groups. Owing chiefly to the
heavy demand for investment capital, interest rates for both short and long
term funds continued the broad rise that began with the business recovery of
the preceding fiscal period. In the face of the urgent demands for funds,
the monetary authorities moved to prevent inflationary price increases
through restricting credit expansion. In reflection of this policy, the dis
count rates at most of the Federal Reserve banks were advanced by stages
from 1% percent on June 30, 1955, to 2% percent on June 30, 1956.

UNITED STATES FOREIGN TRADE DEVELOPMENTS
The fiscal year 3956 was a period of sharp expansion in United States
foreign trade. Both commercial exports and imports reached new record
levels.

A N N U A L R EPO R T OF T H E SECR ETA RY O F COM M ERCE

Merchandise exports, which had already been rising strongly during fiscal
1955, accelerated their advance in the 12 months ended last June. Exclu
sive of military aid shipments by the Government, they totaled over $15 *4
billion in the latter period. This was 15 percent higher than the figure for
the previous fiscal year and 25 percent above that for fiscal 1954.
Imports, rebounding from a temporary downswing in 1954, rose from
$10/2 billion in fiscal 1955 to nearly $12*4 billion in the latest fiscal year.
Percentagewise, this increase was even larger than that in United States
exports.
Sustained high rates of industrial activity both here and abroad were
primarily responsible for these record foreign trade levels. The extended
rise in United States foreign sales reflected strong demands in other indus
trial countries for crude or semiprocessed materials and capital equipment,
while raw material requirements of United States industries provided the
principal support for expanded imports.
In addition, there were also sharp increases in exports of foodstuffs and
other agricultural products, with the notable exception of cotton, while the
high levels of consumer income and business investment in the United States
brought marked expansion in our imports of manufactured goods.

Exports

The gains in United States exports included sizable increases of sales in
every major foreign marketing area. Both in terms of dollar values and
on a percentage basis, however, the advances were greatest in trade with
Canada and Western Europe, where demand was stimulated by rapid in
dustrial expansion. Elsewhere, and especially in Latin America, increases
in sales of United States products were generally more moderate.
The commodities predominant in the upsurge of exports were chiefly
those linked most closely to industrial growth in our principal foreign
markets. Outstanding among them were coal, steel scrap, and steel-mill
products. Exports of these crude or semifabricated materials, taken to
gether, were more than 50 percent higher in fiscal 1956 than the previous
year. In addition, exports of metal manufactures (other than machinery
and vehicles) were nearly 30 percent higher. Many types of capital equip
ment were similarly subject to greatly increased foreign demand. Shipments
of construction and mining machinery rose by 44 percent in value, and
those of other industrial machinery by about 20 percent. Exports of most
other nonagricultural products, while also increasing, showed gains of
considerably smaller proportions.
With the exception of raw cotton, for which foreign demand slumped
prior to the commencement of export sales on a competitive bid basis,
United States agricultural exports rose in fiscal 1956 by approximately
one-fourth. This marked improvement reflected both more favorable eco
nomic conditions abroad and the stimulus of United States Government

A N NUAL R EPO R T OF T H E SECRETA RY OF COM M ERCE

programs for the sale of farm surpluses for foreign currencies. The value
of cotton shipments, on the other hand, was cut almost in half as compared
with the fiscal 1955 total.

Imports

The increase in United States imports from fiscal 1955 to fiscal 1956 was
widely distributed among foreign sources of supply. In general, however,
advances in goods of European or Asian origin outstripped those in pur
chases from countries of the Western Hemisphere.
Of the $1.7 billion increase in United States imports in the year ending
last June, approximately $1 billion was in the form of crude and semifabricated products for industrial processing here. These were the goods
most responsive to the accelerated pace of United States manufacturing
activity.
For such materials, rising prices accounted for much of the increase in
import values, and in a few cases they accounted for all of it, offsetting
actual declines in volume. This pressure on prices reflected the competition
among industrialized countries for the limited supplies available in world
markets.
Another one-half billion dollars of the increase in United States imports
was in the form of manufactured goods. This advance, continuing a trend
noticeable for several years, covered a wide range of merchandise, including
textile manufactures, machinery, and automobiles.
Imports of foodstuffs rose by only about $200 million, or 7 percent. The
volume of such imports increased much more sharply, but this was induced
in large measure by substantial declines in the prices of several leading
items, notably coffee and cocoa.

Supports to the Economy

The rising volume of our foreign trade was an important factor con
tributing to the rapid expansion of the United States economy during the
past fiscal year. The $2-billion growth of sales in foreign markets repre
sented a significant addition to opportunities for employment of American
workers and profits for American producers. Increased imports not only
provided necessary materials for accelerated United States industrial pro
duction but also funished dollars to our customers abroad for their ex
panded purchases here.

Immediate Office of the Secretary
BUSINESS ADVISORY COUNCIL
The Business Advisory Council in fiscal 1956, completed 22 years of serv
ice to the Department of Commerce.
The Secretary of Commerce and other Department officials attended
five scheduled Council meetings at which a wide range of subjects was
discussed.
The Secretary also requested Committee advice on industrial applica
tions of atomic energy, the operations of the Business and Defense Services
Administration, domestic economic activity, foreign economic policy, indus
trial relations policy, taxation, and relations with Latin American countries.
Three new members were invited to serve and nine active members
moved to graduate status. Four members were lost by death.
The Department is fortunate in continuing to enjoy the patriotic and
unselfish service of this group of distinguished men, many of whom have
occupied important positions of public trust.
The active membership was composed on June 30, 1956, of the following:
Frank R. Denton, Pittsburgh, Pa.
Charles D. Dickey, New York, N. Y.
Marion B. Folsom, Washington, D. C.
William C. Foster, Baltimore, Md.
G. Keith Funston, New York, N. Y.
Fred G. Gurley, Chicago, 111.
Joseph B. Hall, Cincinnati, Ohio
Robert March Hanes, Winston-Salem,
111.
N. C.
♦ Sidney J. Weinberg, Vice Chairman,
Devereux C. Josephs, New York, N. Y.
New York, N. Y.
Robert B. Anderson, New York, N. Y. E. H. Lane, Altavista, Va.
♦ Fred Lazarus, Jr., Cincinnati, Ohio
♦ John D. Biggers, Toledo, Ohio
Donold B. Lourie, Chicago, 111.
♦ James B. Black, San Francisco, Calif.
♦ Geo. H. Love, Pittsburgh, Pa.
♦ Harold Boeschenstein, Toledo, Ohio
Roswell Magill, New York, N. Y.
Fred Bohen, Des Moines, Iowa
Deane W. Malott, Ithaca, N. Y.
Ernest R. Breech, Dearborn, Mich.
J. W. McAfee, St. Louis, Mo.
Paul C. Cabot, Boston, Mass.
Thomas B. McCabe, Chester, Pa.
James V. Carmichael, Atlanta, Ga.
L. F. McCollum, Houston, Tex.
Walker L. Cisler, Detroit, Mich.
Earl M. McGowin, Chapman, Ala.
Lucius D. Clay, New York, N. Y.
Paul B. McKee, Portland, Oreg.
♦ Ralph J. Cordiner, New York, N. Y.
Geo. G. Montgomery, San Francisco,
John Cowles, Minneapolis, Minn.
Calif.
Harlow H. Curtice, Detroit, Mich.
W. J. Murray, Jr., New York, N. Y.
Charles E. Daniel, Greenville, S. C.
Aksel Nielsen, Denver, Colo.
♦ Donald K. David, New York, N. Y.
♦ Member of Executive Committee.

*Eugene Holman, Chairman, New York,
N. Y.
*S. D. Bechtel, Vice Chairman, San
Francisco, Calif.
*Crawford H. Greenewalt, Vice Chair
man, Wilmington, Del.
*T. V. Houser, Vice Chairman, Chicago,

A N NUAL R EPO R T OF T H E SECR ETA RY OF COM M ERCE

A. E. Staley, Jr., Decatur, 111.
A. Q. Petersen, New Orleans, La.
Frank Stanton, New York, N. Y.
Paul Pigott, Seattle, Wash.
*Robert T. Stevens, New York, N. Y.
Gwilym A. Price, Pittsburgh, Pa.
Clarence B. Randall, Washington, D. C. R. Douglas Stuart, Chicago, 111.
Charles Allen Thomas, St. Louis, Mo.
Alden G. Roach, San Francisco, Calif. John
C. Virden, Cleveland, Ohio
Donald J. Russell, San Francisco, Calif. John Hay
Whitney, New York, N. Y.
Charles Sawyer, Cincinnati, Ohio
Langbourne
M. Williams, New York,
C. R. Smith, New York, N. Y.
N. Y.*
*J. P. Spang, Jr., Boston, Mass.
Kenneth A. Spencer, Kansas City, Mo. *Member of Executive Committee.

OFFICE OF THE GENERAL COUNSEL
The Office of the General Counsel provides direct legal advice and serv
ices for the Secretary, the Under and Assistant Secretaries, and other de
partmental officials. The General Counsel, as chief legal officer of the
Department, also exercises general supervision of the legal divisions in the
bureaus and offices which have legal staffs and handles legal matters for
those units which do not.
The Office of the General Counsel consists of four basic divisions: Do
mestic Affairs, International Affairs, Transportation, and General Legal
Services. In addition, personnel are assigned to legislative services under
the immediate supervision of the Deputy General Counsel. The Office
also supplies legal advice and trial services with reference to loyalty and
security hearings. An attorney also serves on the departmental Appeals
Board.
During the year, recommendations made after an independent review
of the organization of the departmental legal staffs, have resulted in a
closer integration of some scattered legal units within the Office of the
General Counsel.
The Office continued its active interest in the field of labor-management
relations and in related legislative activity, and assisted in the departmental
participation in the field of antitrust legislation and in various aspects of
antitrust activities. The Office maintained a continuous legal study of
these problems with a view to advising the various agencies of the Depart
ment in their efforts to assist business and industry in their relations with
the Government.

Legislative Activities

The Office of the General Counsel coordinates the legislative program of
the Department and prepares or reviews answers to requests from com
mittees or other authorities on pending or proposed legislation.
In this connection during fiscal 1956 congressional committees made 466
requests for the Department’s views on legislation. Including replies to
requests made prior to July 1, 1955, 436 reports were submitted to the

A N NUAL R EPO R T O F T H E SECR ETA RY OF COM M ERCE

Congress and 83 reports were pending at the Bureau of the Budget for
clearance prior to their submission to the Congress. During the same period
the Bureau of the Budget requested the views of the Department on 107
items of legislation, and 98 replies were made to such requests.
Twelve of the 18 draft proposals submitted to the Bureau of the Budget
for clearance during this period were transmitted to the Congress. Suc
cessfully concluded by enactment in the second session were 22 legislative
proposals drafted in the Department or contained on our legislative program
and 11 other measures which the Department strongly supported. In addi
tion, replies were made to Bureau of the Budget requests for the views of
this Department in respect to 124 enrolled enactments.

Domestic Affairs

The Domestic Affairs Division performed all legal work for the Business
and Defense Services Administration, Office of Business Economics, Census
Bureau, Office of Technical Services, Coast and Geodetic Survey, and
National Bureau of Standards, and for the Patent Office in matters other
than the issuance or denial of patents and registrations of trademarks.
During the year the Division was especially occupied with the development
and coordination of proposed legislation to provide Federal assistance to
areas of substantial and persistent unemployment, winding up the affairs of
the Inland Waterways Corporation, and the study and approval of legal
aspects of measures to assure satisfaction of requirements of current defense
procurement and of activities in the field of industrial mobilization for an
emergency, including the readying of plans and orders to assure availability
of needed materials for security and essential civilian use.

International Affairs

The International Affairs Division performed all legal work falling within
the responsibilities of the Assistant Secretary of Commerce for International
Affairs, including the Bureau of Foreign Commerce and the Office of Inter
national Trade Fairs. This work involved principally the legal aspects of
administration of the Export Control Act and that involved in the program
of participation in international trade fairs abroad.
Export control legal work for BFC consisted of two broad types: (1)
Compliance work, prosecution of administrative compliance cases, and
assistance to the Department of Justice in connection with criminal cases;
and (2) preparation of regulations, review of procedures for conformance to
regulations, and assistance in the interpretation of regulations and proce
dures for licensing officers and the export trade.
Trade fair legal work included: (1) Preparation of contracts with Amer
ican firms and individual specialists for design, architectural, and other
services for construction and acquisition in this country and abroad of

ANNUAL REPO R T OF T H E SECRETA RY OF COM M ERCE

exhibit materials; and (2) assisting in arrangements for the use and display
at the fairs, by the Government, of items furnished by private firms.
The Division also provided a variety of legal services arising under the
Foreign-Trade Zones Act, the China Trade Act, and the so-called British
Token Import Plan.

Transportation Activities

The Transportation Division performed all legal work required in the
review of legislative proposals, reports, agreements, and regulations pre
pared by the transportation agencies of the Department for the approval of
the Secretary. These agencies include the Civil Aeronautics Administra
tion, Maritime Administration, and Bureau of Public Roads.
The Division was especially occupied with legislation leading to enactment
of the Federal Aid Highway Act of 1956, authorization for the construction
of a nuclear-powered merchant ship, and extension of aviation war risk
insurance authority. The Division was also concerned with legislation
implementing recommendations of the Presidential Advisory Committee on
Transport Policy and Organization.

General Legal Services

The General Legal Services Division reviewed all contracts entered into
by the Department which must be approved by the Secretary or submitted
for legal approval pursuant to Department order. Contracts, leases, bonds,
agreements, and similar contractual matters which were prepared or re
viewed numbered 199. The Division also prepared or reviewed 116 requests
from agencies of the Department for opinions of the Attorney General or
Comptroller General and other matters submitted to these officials, includ
ing reports on litigation. Legal opinions and other legal memoranda
rendered totaled 740.
In addition, this Division reviewed for legal effect all Department orders;
received and processed applications for free use of Government-owned
patents; maintained legal liaison with the appropriate administrative
divisions concerned with personnel, budget, and appropriation problems;
and rendered day-to-day legal consultative services to the various adminis
trative divisions. The Division also reviewed matters arising under the
Federal Tort Claims Act.

OFFICE OF PUBLIC INFORMATION
The Office of Public Information scheduled an increased number of news
conferences and background briefings by top officials of the Department to
publicize important developments in business, transportation, domestic
commerce, and foreign trade. Some of these conferences were placed on a
periodic basis.
------ 3

407217— 57

A N NUAL REPO R T OF T H E SECRETA RY OF COM M ERCE

In response to the need for speech material by officials making public
appearances before business and community groups, OPI expanded its
editorial research activities to provide a steady flow of factual information
for use in public addresses and statements and magazine articles.
With the cooperation of the various bureaus and agencies, OPI further
improved the scope and efficiency of circulation procedures to assure receipt
of Commerce materials by interested representatives of the daily press,
trade publications, radio and television broadcasters, and other mediums.

OFFICE OF STRATEGIC INFORMATION
The Office of Strategic Information was established in the Department
in 1954 upon the recommendation of NSC, as approved by the President.
It comprises a Director and three staff assistants.
With interagency consultation, the Office furnishes guidance to executive
branch agencies on the publication of nonclassified information which may
be prejudicial to the United States defense interests; coordinates Govern
ment policies on the international exchange of nonclassified information
with the Soviet bloc; and furnishes guidance for the voluntary use of busi
ness and industry on problems relating to publication and exchange of such
information.
In view of the fact that the Soviet bloc has a favorable balance in the
flow of such information between the United States and the bloc, consid
erable effort was expended during the year in creating an awareness of this
problem within and outside of Government through organizations such as
the American Chemical Society, National Security Industrial Association,
International Council of Industrial Editors, American Association for the
Advancement of Science, National Business Publications, American Society
for Industrial Security, Associated Business Publications, and the aerial
photography industry.
A Government-wide policy guide was developed covering the exchange
of published information with the Soviet bloc. To handle certain details
of the exchange program, a unit of the Office was established at the Library
of Congress to compile a “want list” of Russian publications which are not
available here. Approximately 3,000 such items have thus far been listed
for possible procurement through the exchange program. Advice on fur
nishing information to the Soviet bloc was requested by an increasing num
ber of individuals, firms, and research organizations from practically every
State in the Union.
Future plans contemplate an expanded effort on the three programs
with emphasis on the evaluation and dissemination of the information
received from the bloc in exchanges.

ANNUAL REPO R T O F T H E SECRETA RY OF COM M ERCE

Office of the Assistant Secretary
for Administration
The Assistant Secretary of Commerce for Administration serves as the
principal assistant to the Secretary on all matters of departmental admin
istration and management. The primary responsibility of this Office is to
assure the effective administration of the Department’s programs and its
proper representation before other Government agencies. The Assistant
Secretary also provides policy direction to the activities of the Agency In
spection Staff, Appeals Board, Emergency Planning Coordinator, and the
Offices of Budget and Management, Administrative Operations, Personnel
Management, Publications, and Security Control.
Staff of this office worked closely with the operating bureaus to assure
that technically sound, effective, and economical management programs
were installed and maintained.
Administration of the Department’s programs for fiscal 1956 required a
total expenditure of $1,223,835,805. Total paid employment in the De
partment on June 30, 1956, numbered 47,175.
Administrative accomplishments within the Office of the Assistant Sec
retary for Administration are cited in the separate reports of component
offices which follow.

OFFICE OF ADMINISTRATIVE OPERATIONS
The Office of Administrative Operations provides the Office of the Sec
retary, Business and Defense Services Administration, Bureau of Foreign
Commerce, and Office of Business Economics with operational services,
including building administration, communications, procurement, supplies,
and library facilities. Through a central staff, the Office also provides
leadership for Department-wide programs in the fields of records manage
ment, property and space management, safety, and motor vehicle man
agement.
During the fiscal year, the Office concluded an agreement with the Post
Office Department for handling and paying for penalty mail, saving $100,000 annually; extended the use of imprest funds for small purchases, saving
about $20,000 a year; reorganized and relocated the Sales and Distribution
Branch, improving public service and increasing per-man production; issued
a handbook which standardized procedures and practices for preparation
of secretarial correspondence and reduced letterheads in use from 32 to 12;
and developed better motor vehicle maintenance and use standards which
saved $62,000.
Over 6,200 purchase documents were written during the year for articles
and services with a gross value of over $1,200,000.

ANNUAL REPO R T OF T H E SECR ETA RY OF COM M ERCE

The completion of an accurate and detailed inventory of 413 real prop
erty holdings, valued at $281,139,000, will increase utilization and expedite
disposal of surplus items. Reports covering excess personal property valued
at $4,121,000 were acted upon; $1,955,000 of it was declared surplus to
General Services Administration. From the remainder, requisitions were
filled for items valued at over $2 million.
During the year, 80,000 cubic feet of records were removed from operat
ing space and 37,000 cubic feet were disposed of in Federal records centers.
This released personal services, equipment, and space with a replacement
value of $198,000 on the basis of a General Services Administration formula.
Several pilot paperwork management projects were completed and an ex
panded program including all primary organizations is planned.
The number of motor vehicles owned and operated by the Department
was reduced by 194. In the establishment of interagency motor pools, the
Office, cooperating with the GSA, played a leading role in making
city-by-city surveys of transportation requirements and in the transfer of
vehicles where economy could be gained through pool operations.
A total of 2,693 personal injury and motor vehicles accident reports was
handled, showing a 7-percent decrease in injuries to office personnel in the
first 9 months of a Department-wide office accident prevention program.
The library loaned 117,000 items, answered 22,400 reference requests,
and served 41,000 readers from the staff and public. This record activity
was achieved with no increase in staff as a result of improved cataloging
and adjusted work assignments.

APPEALS BOARD
The Appeals Board for the Department of Commerce serves as an im
partial body to make final decision on certain appeals from the public
when adversely affected by orders, regulations, or administrative action of
the Department in connection with export control matters, importation of
foreign excess property, or other statutory authority of the Department. It
also hears appeals relating to contracts of the Bureau of Public Roads, and
other appeals specifically assigned to it by appropriate authority.
During the past fiscal year the Board disposed of 47 appeals involving 11
formal hearings.

OFFICE OF BUDGET AND MANAGEMENT
The Office of Budget and Management is the central point of contact
over the Department’s financial affairs and organizational development. It
develops departmental policy within its area of responsibility, reviews budget
estimates, provides criteria for the control of all funds, reviews organiza
tional structures, develops organizational plans, and makes continuing
studies of functional and organizational relationships.

ANNUAL REPO R T OF T H E SECR ETA RY OF CO M M ERCE

The Office reviews departmental administrative and operating practices,
procedures, and methods; evaluates the Department’s programs in terms
of efficiency of management and economy of operations; promotes par
ticipation in the Department’s management improvement program and the
Government-wide joint program for improvement of accounting; furnishes
a central fiscal advisory service to all bureaus ; and assists the Assistant Sec
retary of Commerce for Administration in assuring continuity in top
management.

Budget Activities

The Office of Budget and Management considered regular annual budget
estimates of $1,578,717,837 for the fiscal year ending June 30, 1957. After
review and analysis by the Office, the Secretary of Commerce approved
$1,484,492,750 for transmittal to the Bureau of the Budget. The President’s
budget, which was transmitted to Congress in January 1956, included
$1,428,868,000 for the Department of Commerce.
In addition to the regular annual budget estimates supplemental appro
priation requirements for fiscal 1957 in the amount of $172,566,429 were
reviewed. The Secretary approved the supplemental estimates in the
amount of $172,090,429 for transmittal to the Bureau of the Budget. The
President approved $142,145,429 of the 1957 supplemental requests and
transmitted them to Congress for consideration.
In addition to the regular appropriations of the Department of Com
merce, the Congress appropriated $800 million from the highway trust fund
to finance the Federal-aid highway program for fiscal 1957.
Summary of Balances, Appropriations, and Expenditures, Department of Commerce,
Fiscal Year Ended June 30, 1956
Unexpended
balance
June 30, 1955

Appropriation Total (columns Expenditures
fiscal year
1 and 2)
fiscal year
1956
1956

Office of the Secretary__________________ 34,054,709
32,312,500
36,367,209
33,167,506
Bureau of the Census___________________
4,705,974
17.132.000
21,837,974
18,517,654
Civil Aeronautics Administration________
53,893,193
169.320.500
223,213,693
147,629,215
Coast and Geodetic Survey______________
1,175,781
10.724.000
11,899,781
11,058,117
Business and Defense Services Administra
tion_________________________________
818,519
6,600,000
7,418,519
6,849,824
i 894,060
Bureau of Foreign Com m erce.._________
4.966.500
5,860,560
5,201,150
122,203
Office of Business Economics____________
960,000
1,082,203
1,014,083
Maritime Administration________________ 241,815,650
250.170.500
491,986,150
198,196,817
1,500,443
14.500.000
16,000,443
14,251,513
Bureau of Public Roads_________________ 17,353,534
829,730,000
847,083,534
775,379,821
8,427,447
National Bureau of Standards_____ ______
8.408.500
16,835,947
8,714,930
4,890,698
41.650.000
46,540,698
33,855,175
Total------------------------------------------ 339,652,211 1,356,474,500 1,696,126,711 1,223,835,805
1 Includes expired appropriation for Bureau of Foreign and Domestic Commerce.

Management Activities

Directing its efforts toward further strengthening management, improv
ing efficiency, and reducing costs throughout the Department, this Office—

ANNUAL REPO R T O F T H E SECR ETA RY O F COM M ERCE

Made studies of special matters and requirements having across-the-board appli
cation to several or all bureaus, such as the development of departmental views on
establishing a Government-wide policy on cost participation in Government contracts
with educational institutions; reported on cost of administering the Government
employees security program; evaluated and reported on the status of implementation
of Hoover Commission recommendations concerning paperwork management;
reviewed recommendations made in reports of management consultant and advisory
groups ; and reviewed departmental programs financed by the International Coopera
tion Administration and working relationships between the agencies and bureaus
concerned.
Conducted field surveys at 24 locations during the year. The conclusions and
recommendations developed through these surveys were referred for action by appro
priate departmental and bureau staff.
Developed plans for revitalizing the Department of Commerce Field Council, which
was originally set up in 1946, to assure that field personnel are kept informed of the
Department’s activities at all times.
Reviewed reports and recommendations of the Commission on Intergovernmental
Relations, particularly as they affect programs and operations of the Department, and
submitted comments to the Bureau of the Budget on effectuating applicable recom
mendations.
Established uniform cost-recovery procedures for pricing services rendered and
special reports issued by all units of the Department in accordance with directives
of the Bureau of the Budget.
Transferred the accounting operations function from the Office of Administrative
Operations to the Accounting Systems Division of the Office of Budget and Manage
ment and designated it the Accounting Operations Branch.
Assisted three bureaus in establishing improved accounting systems.
Appraised both current and planned programs for economic development of spot or
chronic labor surplus areas and recommended reconsideration and redirection of the
programs to provide more effective assistance to the areas concerned.
Inaugurated a study to improve accounting methods and techniques which led to
the development of a mechanized system for providing timely reports and essential
information on individual transactions not previously available to the operating units
serviced by the Accounting Operations Branch.
Made a study of the Department’s policies, authorities, procedures, and specific
practices for making information available to the Congress, the press, other Govern
ment agencies, and the public.
Developed a system under which United States embassies and consular posts report
financial data on trade fairs directly to the Office of International Trade Fairs. The
system provides information essential to management of the program, budgeting of
funds, and reporting of trade fairs activity.
Conducted a comprehensive manpower utilization survey in cooperation with the
Office of Administrative Operations and the Office of Personnel Management. The
purpose was to promote the Department’s policy of holding the number of employees
to the minimum required to carry out approved programs efficiently. Manpower
utilization teams established in each unit of the Department checked adherence to
restrictions in filling any vacant positions of marginal value and appraised programs
and operations to determine where immediate personnel economies could be effected.
As a result, 68 temporarily vacant positions in the Washington area were eliminated,
65 other positions were designated for elimination upon transfer or attrition of persons
holding the positions, and numerous organizational, operational, and procedural
actions were taken to improve manpower utilization.

ANNUAL R EPO R T O F T H E SECR ETA RY OF COM M ERCE

Initiated and coordinated advance planning on the administrative and manage
ment aspects of new legislation affecting departmental programs, such as the vastly
expanded highway construction program, transfer of the Alaska Road Commission
from the Department of the Interior to the Department of Commerce, permanent
status of the United States Merchant Marine Academy, and exchange of a Govern
ment-owned reserve shipyard for other real property owned by the State of North
Carolina.
Through coordination between the Federal Civil Defense Administration and the
several bureaus of the Department, clarified the budget and management aspects
of delegated civil defense responsibilities of the Department.
Provided staff advice and assistance on many bureau management and program
matters, such as a plan to provide messing services at the United States Merchant
Marine Academy by a private caterer which will save an estimated $35,000 a year;
development and coordination of interdepartmental agreements relating to estab
lishment of maritime attachés in foreign countries and for exchange of foreign
service officers between State and Commerce Departments; and review and coordi
nation of a 5-year plan for improvement of the Federal airways system of air navi
gation and air traffic control.
Developed a digest of budget programs and fund requests for the expeditious
analysis of proposed requests at budget hearings.
Participated in the inspection and review of the operations of the Federal Barge
Lines, Inc. (purchaser of the Inland Waterways Corp.), maintained accounting
records on the Inland Waterways Corp., and prepared the financial statement as
required by law.

OFFICE OF PERSONNEL MANAGEMENT
The major responsibility of the Office of Personnel Management is to
direct and supervise the administration of personnel management through
out the Department of Commerce.
During fiscal 1956 this Office was reorganized to separate staff .guidance
and assistance work from personnel operations, so as to increase the effec
tiveness of both types of activities. In addition a program was designed
for the internal review and evaluation of personnel management activities
conducted throughout the Department to effect improvements and econ
omies in operations.
Personnel policies, regulations, and instructions were kept current through
the issuance of 18 new or revised administrative orders, 14 amendments to
basic orders, and 72 information bulletin items.
Changes in personnel procedure or practice recommended by the Hoover
Commission were placed into effect to the extent possible without legislative
action.
The performance rating requirements were simplified by abolishing per
formance rating committees in each primary organization unit and eliminat
ing 45,000 performance rating forms each year for employees rated “sat
isfactory.”

A N NUAL REPO R T O F T H E SECR ETA RY OF COM M ERCE

A review was made of the classification grades of all positions throughout
the Department to make sure they are properly allocated. Corrective action
was taken where necessary.
A newly designed employee handbook was published and furnished to
all employees. Its format provides for insertion of new pages containing
changes in law, regulation or policy, thus enabling employees to have in
their possession at all times a handbook containing current information.
Increased authority was delegated to primary organization units in the
incentive awards program.
A total of 3,338 suggestions was received from employees, an increase
over the previous year’s figure of 2,828. Savings resulting from suggestions
adopted for use amounted to $119,467.55.
Cash awards were paid to 599 employees for their contributions toward
improved Government operations, which resulted in savings of $235,370.23.

OFFICE OF PUBLICATIONS
The Office of Publications is responsible for central review and control of
publications, promotion of publications sales, forms design, and operation
of the Department’s short-run printshop.
As the Department’s standards of essentiality and nonduplication become
more widely understood, fewer and fewer of the proposed publications sub
mitted to the Publications Division required outright rejection. In the
1956 fiscal year, the Division reviewed 168 projects with estimated printing
costs of $530,000. Of these 139 were approved as presented, 23 were ap
proved with conditions, and only 6 were rejected.
With no additional employees, production in the Printing Division’s shop
was 40 percent above that of the previous year as a result of modernization
of equipment and the continuing reorganization. A 10-cents-an-hour in
crease for Wage Board employees, granted in January, and a 20-percent in
crease in paper cost were absorbed without increasing prices. Installation
of new equipment in the Composition Branch brought greatly increased
flexibility to the Branch’s work and a marked improvement in typography
and general appearance of both administrative and informational printing.
It is estimated that savings of about 10 percent have been made through
use of this new equipment.
Sales of Department of Commerce publications through the Superin
tendent of Documents amounted to $1,301,496 in fiscal 1956, accounting
for 23 percent of his total sales and the largest of any Department. In
cluding technical reports, charts and maps, and patents and trademarks,
sales of departmental printed material reached $3.1 million, the highest ever.
The Sales Division arranged with the Superintendent of Documents to
print and mail 2.5 million announcements of books, periodicals, and series.
Another million were distributed by the Department.

ANN U A L R EPO R T OF T H E SECR ETA RY OF COM M ERCE

Office of the Under Secretary
The Under Secretary of Commerce serves as the principal deputy of the
Secretary in all matters affecting the Department of Commerce and exercises
general policy direction over its bureaus and offices. In addition, he gives
particular attention and policy guidance to the Coast and Geodetic Survey,
the Patent Office, and the National Bureau of Standards, which are directly
responsible to him.
The Coast and Geodetic Survey completed the adjustment of the northern
Alaska triangulation, the largest adjustment ever accomplished by a single
set of simultaneous equations; dedicated and placed in operation its mag
netic observatory and laboratory near Fredericksburg, Va.; completed stud
ies preliminary to the design of the survey ship authorized this year; began
modification of some of its Atlantic Coast tide gages for forecasting the
probability of storm high waters in conjunction with the Weather Bureau’s
hurricane warning service; and continued the successful operation of the
seismic sea wave warning system for safeguarding lives and property in the
Pacific area.
The National Bureau of Standards has made good progress toward achiev
ing an effective technical balance in its programs. It has shifted emphasis
from work undertaken with transferred funds for other Government agencies
to research consistent with the primary responsibilities of the Bureau. This
is being accomplished with the advice of the Bureau’s technical advis
ory committees. Encouragement has been given to the development of an
effective basic research program which will support the important and
principal mission of the Bureau. Every one of the Bureau’s research divi
sions has been urged to reexamine its total program and to institute a fuller
program of standards research than has hereto been possible.
With the increased resources provided by Congress in the appropriation
for 1956, the Patent Office was able to take effective measures for increasing
its manpower to cope with the backlog of pending applications for patent.
The examining staff was enlarged and intensive use was made of experienced
examiners in overtime work to obtain the benefit of their relatively high
production to offset the low rate of new and inexperienced men. As a re
sult, the number of applications disposals was 55 percent greater than in the
preceding year and exceeded receipts, despite their continuing high number,
thereby resulting in reduction of the backlog. A slight reduction was also
realized in the number of design applications pending. There were 217,536
patent and 6,605 design patent applications on hand June 30, 1956. The
number of patents granted during the year was 43,798, including 3,104 design
patents.
The sustained upswing in our business economy was reflected in a con
tinued increase in the number of applications for trademark registration filed
in the Patent Office. There were 21,735 such applications received in 1956,
407217—57------4

A N NUAL REPO R T O F T H E SECR ETA RY O F COM M ERCE

this being the second largest volume of marks filed in 1 year in the Patent
Office. With a smaller staff than in 1955, the Office disposed of more appli
cations than in any preceding year and registered a record number of trade
marks, 21,613.

COAST AND GEODETIC SURVEY
The Coast and Geodetic Survey performs a wide variety of essential serv
ices for the advancement of marine, aviation, commercial, and industrial
interests of the country. This Bureau is responsible for surveying and
charting the coastal waters of the United States and its Territories and pos
sessions. It provides a framework of geodetic control in the interior of the
country for use as starting points for mapping and engineering construc
tion; compiles and publishes data on tides and currents; compiles and pub
lishes aeronautical charts for civil and military aviation; makes observa
tions of the earth’s magnetism; and investigates earthquakes and their de
structive effects. It is primarily a field organization administered from
Washington, where the basic field data are processed and the results made
available to other Government agencies and to the public in the form of
maps, charts, and technical publications.
The basic program of the Bureau was carried forward during the year
in every department of its activities.

Hydrography, Topography, and Tides

Surveys of coastal waters were initiated or continued during the year by
17 ships and 2 shore-based parties along the Atlantic, Gulf, Pacific, and
Alaska coasts.
By continuing the wire dragging of sealanes along the Atlantic coast to
locate wrecks caused by enemy submarines during World War II, 59 wrecks
and obstructions were located between the Virginia Capes and Gape Fear,
N. C.
New, electronically controlled hydrographic surveys were completed of
Browns Bank and of the northeastern part of the Gulf of Maine. The new
ship Scott, acquired last year, began coast pilot investigations along the
gulf coast, for revision of the Gulf Coast Pilot, last revised in 1948, to sup
plement the information shown on nautical charts. Considerable chart
revision work was an important byproduct of these investigations.
The electronically controlled offshore hydrographic survey in the Pacific
Ocean, sponsored by the Department of the Navy, was continued during
the year. More than 200,000 square miles of hydrography were completed.
Hydrographic surveys were in progress or completed in various areas of
Alaska, such as in Prince William Sound; along the north coast of the
Alaska Peninsula, in the vicinity of Amak Island; along the south side of

ANN U A L REPO R T OF T H E SECRETA RY OF COM M ERCE

the peninsula east of Wosnesenski Island; in the Aleutians, north of Great
Sitkin Island and south of Adak and Little Tanaga Islands; in Cordova
Bay; and along the west coast of Prince of Wales Island.
Deep-sea sounding lines were run by the ships operating in Alaska from
their bases in the States to the Alaska working grounds as part of a con
tinuous program of surveying the North Pacific Ocean and the Gulf of
Alaska.
Topographic mapping by photogrammetric methods was continued along
the coastal areas of the United States and Alaska as part of the Bureau’s
charting program. A special map of Providence, R. I., was prepared for
use in storm-water inundation studies. This is a pilot project to deter
mine the type of map information needed for evacuation when storm
waters are forecast, for underwriting storm-damage insurance, and for
preventing storm damage. Under the airport mapping program, photo
graphs were taken of 45 airports, field surveys completed at 39 airports,
and 13 new airport obstruction plans published, bringing the total number
issued to date to 514.
To provide the basic observational data for tide predictions and for
other uses, a system of control tide stations was maintained at selected loca
tions along our coasts and on certain of the trust islands in the Pacific.
New stations were established at Panama City, Fla., and at Christmas
Island in the Pacific Ocean. Tide records for 39 places in Latin America
were received through cooperative arrangements with the Inter-American
Geodetic Survey. The severe water damage caused by destructive hurri
canes during the past year resulted in requests from Federal agencies,
engineering firms, insurance adjusters, oceanographic institutions, and legal
firms for copies of tide-gage records. A project of determining storm effects
on water levels at tide stations was undertaken to assist the Weather Bureau
with its hurricane warning project.
Records of the ebb and flow of tidal currents were obtained at 48 loca
tions in the waters of Maine, Massachusetts, Chesapeake Bay, Florida,
Washington, and Alaska. Observations were continued at two Atlantic
coast lightships. At the request of the city officials of Gloucester, Mass., a
special tidal current survey was made of the harbor for purposes of navi
gation, control of harbor pollution, and beach preservation.
Advance information relative to the periodic rise and fall and ebb and
flow of tidal waterways was published in the annual Tide Tables (4 vol
umes) and Current Tables (2 volumes) for use in marine navigation and
in harbor construction work.
Observations of the temperature and density of water along our coasts
and in many harbors and estuaries were continued. At the close of the
year daily observations were being made at 130 places. Data derived
from these observations are published in a series of four pamphlets.

A N NUAL REPO R T OF T H E SECRETA RY OF COM M ERCE

Geodesy, Magnetism, and Seismology

Geodetic field parties continued operations in the United States and
Alaska to provide geographic positions and elevations in unsurveyed areas
for mapping and for many other engineering uses. Gravity and astronomic
observations were also made in selected areas. A total of 2,669 new geo
graphic positions covering an area of 57,189 square miles were determined.
The United States level net was extended 5,547 miles. Releveling under
taken in Arkansas and California to determine subsidence disclosed that
the maximum rate of settlement in the land of the San Joaquin Valley of
California has reached 1% feet per year. Completion of the basic frame
work of the Alaska triangulation was a major accomplishment in the exten
sion of triangulation even though there still remains much to be done in
the area enclosed within it. The adjustment of the northern Alaska net,
with over 1,100 main scheme stations, was the largest ever accomplished
by a single set of simultaneous equations.
Astronomic observations for the control of triangulation were completed
at four stations in Alaska. Additional observations were made in connec
tion with the development of the Patrick Air Force Base missile test range
off Florida and at the Rome Air Development Center in New York State.
Observations were undertaken at 11 second-order astronomic stations along
the 35th parallel for the geoid profile program.
The area gravity survey in Iowa and adjoining States was continued
northward with observations completed over about 50,000 square miles.
A special gravity survey was conducted on Cape Canaveral in Florida, in
connection with the operations at the Patrick Air Force Base missile test
range, and a gravity traverse was run between the Cape and Houston, Texas.
Through field surveys and observatory operations, the Bureau conducts
geomagnetic investigations to provide data facilitating the use of compasses
in navigation and in interpreting the records of old boundary surveys, and
to furnish a basis for interpreting geophysical prospecting activities and
other physical studies. During the year routine magnetic operations were
continued at six observatories. Magnetic elements were determined at 39
stations in the United States and Alaska, 13 of them in the “repeat station”
net and 26 newly established. The Fredericksburg, Va., observatory was
dedicated May 23, 1956, and placed in routine operation. Surveys were
made at 44 compass testing sites on Air Force bases, and a special airborne
survey was made in the vicinity of Patrick Air Force Base. Preparatory
work was done on the geomagnetism program of the International Geo
physical Year.
In seismology, the Bureau observes, locates, and classifies earthquakes;
coordinates and assists in similar work done by others; and studies the effects
of earthquake waves and related phenomena in the earth. The Survey
maintains seven seismograph stations for locating distant earthquakes and
cooperates in the maintenance of 15 others. It also operates 71 strong-

A N NUAL REPO R T OF T H E SECRETA RY OF COM M ERCE

motion seismographs in the central areas of destructive earthquakes. Ap
proximately 1,100 earthquakes were located throughout the world by using
instrumental reports from cooperating stations in this country and abroad.
Seismic surveys were made on a beach in Florida for the Department of
Defense. In connection with the International Geophysical Year, 2 com
plete seismographs were shipped to Antarctica, and 4 were installed on
Pacific islands.
The seismic sea wave warning system for the Pacific Ocean area was con
tinued during the year. No seismic sea waves were generated by the several
major earthquakes in the Pacific area, but the responsibility of the warning
system required a total of 45 warning and precautionary actions. The
earthquake of May 23, 1956, in the Fiji Islands, the strongest of the year
in the Pacific, caused 23 actions to be taken by Hawaiian authorities. With
in 40 minutes of the time of origin, these authorities were advised of its lo
cation and the possibility of a seimic sea wave.

Nautical and Aeronautical Charts

Nautical and aeronautical charts and related publications are a part of
the necessary equipment of the Navy, Air Force, merchant marine, and
civil aviation. They are in ever-increasing demand by vacationers who
operate their own boats or aircraft. With the modern nautical chart the
information furnished by such electronic navigational devices as echo
sounding, radar, and loran can be utilized to the best advantage.
Aeronautical charts must serve the range of needs from the small private
plane to the largest commercial and military planes. At the end of the
year, 806 nautical charts and 1,533 aeronautical charts in various cate
gories were available to meet the needs of marine and air navigation.
More than 43 million charts were distributed during the year. With
one exception, this was more than in any other year.

Technical Improvements and Cooperation

The Bureau’s program of research and development to improve its in
struments, equipment, and operating techniques has advanced during the
year. Because of the specialized nature of the Survey’s work, much of its
instrumentation and equipment cannot be obtained commercially, and
therefore must be produced through research and development by its own
staff. Wherever possible, the Bureau uses new developments in private in
dustry, and in turn makes the results of its researches available to com
mercial establishments.
Improvements were made in the instruments used in nearly every branch
of the Bureau’s activities. Among these were the design of remote-record
ing apparatus for the tide gages to assist in the hurricane warning service;
design and purchase of automatic equipment for typing data directly from
the tide predicting machine; a prototype strong-motion seismoscope to
meet the long-continued demand for a low-cost instrument; conversion of

A N NUAL REPO R T OF T H E SECRETA RY OF COM M ERCE

an obsolescent type of theodolite to a vertical collimator; modifications of
circuit designs of electronic equipment used in hydrographic surveying;
the purchase of a precision mapping camera with an infrared lens cone
which will improve the delineation of high- and low-water lines; and the
adoption of scribing on coated plastic in the reproduction of nautical charts.
Cooperation was extended during the year to a number of Federal, State,
and local agencies and to foreign governments and international organi
zations through new and existing arrangements. Under provisions of
existing international cooperation acts, 12 training grants were awarded to
7 countries, 11 trainees of previous grants continued through this year,
and 40 visitors from 21 countries received instruction in Bureau methods
for periods of 1 to 60 days. The technical mission to Liberia to direct
a surveying and mapping program and to establish a cartographic service
was closed in April 1956.

Plans and Recommendations

Two major national programs are expected to have their effect on this
Bureau. These are the expansion and modernization of the Federal Air
way System, which will necessitate planning and research as an integral
part of the Survey’s aeronautical charting program, and the Federal-Aid
Highway Act of 1956, which will affect both field and office geodetic
activities.
The Survey plans a continuation of its cooperation with the Department
of Defense in all phases of its activities in Alaska, the redrafting and mod
ernization of the world and sectional series of aeronautical charts, and the
development of a program for continued Bureau operation in case of
disaster.

PATENT OFFICE

The Patent Office administers the laws relating to the granting of patents
and the registration of trademarks. In performing these functions it ex
amines applications for patent to ascertain whether or not the applicants
are entitled to receive patents under the law; issues patents to those entitled
to receive them; prints and distributes copies of patents and other related
matter; records assignments of patents; maintains a collection of patents
for reference use by the public; and supplies copies of records and other
papers for which requests are received. Similar activities are conducted
in connection with the registration of trademarks.

Patent Operations

During fiscal 1956, the Patent Office received 75,733 applications for
invention patents and disposed of 79,601, thus reducing the backlog by
3,868. Of the disposals, 51,180 were allowed for issuance of patent and
28,421 were abandoned. Patents issued totaled 40,694. On June 30, 1956,
there were 17,333 allowed applications on hand awaiting payment of final

ANNUAL REPO R T O F T H E SECR ETA RY OF COM M ERCE

fees before issuance of patents. An additional 4,126 were in process of
patent issuance.
With the rate of disposal 55 percent greater than in the preceding year,
not only was the rise in backlog of pending applications halted but progress
was actually made toward attaining the ultimate objective of reducing the
number on hand (217,536 on June 30, 1956) to approximately 100,000—a
level at which the work of the Patent Office could be maintained in sub
stantially current condition.
Plans for achieving this condition in 8 years were formulated during the
year and embodied in a program which was laid before the Congress in
connection with the presentation of budget requirements for fiscal 1957.
A salient feature of this program which was tried experimentally and with
marked success during 1956 was the employment of experienced examiners
on Saturdays for overtime work. The increased output of experienced
personnel working overtime offset the comparatively low production of the
new men, resulting in a relatively high average output.
As a result of an intensive recruitment program, 440 recent college grad
uates were employed as examiners. After separations, there was a net gain
of 288 in the examining staff.
Through these measures, maximum use was made of the increased re
sources provided by Congress for operation of the Patent Office in fiscal
1956.
A program designed to accelerate the reclassification of invention patents,
as well as to enhance the value of newly reclassified groups of patents to
patent examiners, was inaugurated in the Classification Group. This in
volved the transfer to the Classification Group of patent examiners experi
enced in the examination of patent applications for inventions in the art
to be reclassified, along with their pending applications and search files.
Both the examiners and the skilled patent classifiers perform concurrently
both reclassification and examining functions. Several immediate and longrun benefits are expected to result from this combined operation.
The unit established in the Patent Office to carry out recommendations
of the Advisory Committee on Applications of Machines to Patent Office
Operations has been fully engaged in attempts to solve the difficult prob
lems involved in the establishment of a mechanized searching system by
which it is hoped to increase greatly the speed and accuracy of patent
searching. This unit advanced its studies during the year to the point
where some satisfactory form of mechanization would seem to be possible.
The design and construction of a suitable machine is now being studied in
cooperation with the National Bureau of Standards.
During fiscal 1956 the Patent Office received 5,322 applications for de
sign patents, aside from invention patents, and disposed of a greater num
ber, thus reducing the backlog of pending applications from 7,018 to 6,605.
At the 1956 rate of application disposal and with an average staff of 16
examiner assistants, slightly over 1 year’s work remained on hand.

A N NUAL REPO R T OF T H E SECRETA RY OF COM M ERCE

Trademark Operations

Registration of trademarks is done in divisions of the Trademark Exam
ining Operation. Innovations and changes in practice affecting the work
of examiners in these divisions substantially improved this operation. In
fiscal 1956, with a staff of four fewer examiners than in 1955, more appli
cations were disposed of than in any preceding year and the record number
of 21,613 trademarks registered was an increase of 34 percent over the
registrations in 1955. The backlog was reduced by more than 2,000 appli
cations. At the end of the year 9,548 applications awaited action by ex
aminers as compared to 11,752 a year before.
The sustained upswing in business activity was reflected in a continued
increase in the number of marks sought to be registered. Applications for
registration received in fiscal 1956 reached 21,735, the largest number re
ceived in any year except for fiscal 1948, when the present trademark law
became effective. Applications for the renewal of trademark registrations
numbered 3,675, or very nearly one-third of the marks originally registered
or renewed 20 years earlier.

Use of Funds

The operating cost of the Patent Office for fiscal 1956 was $14,471,723,
or 99.8 percent of the $14,500,000 made available by the Congress. Net
income was $6,547,469.39, or about 45 percent of operating costs. This
sum, which was deposited in the miscellaneous receipts of the Treasury,
was $675,000 greater than last year’s net income and was the highest in the
history of the Patent Office.

A Summary of Services

In prosecuting patent and trademark applications, the Patent Office—

Produced and supplied 1,929,294 photographic copies of records, patents, draw
ings and related materials, a substantial part of which was furnished for fees which
totaled $448,885.
Prepared 27,321 title reports based on searches of assignment records and recorded
56,325 instruments conveying ownership of patents, trademarks and applications for
the same.
Supplied 7,586,962 printed copies of patents and trademarks, of which over 70
percent was sold, producing revenue totaling $1,107,537.
Provided 48,944 certificates attesting the authenticity of records furnished on order.
Provided drafting services required in preparing or correcting a total of 15,495
sheets of patent drawings.

NATIONAL BUREAU OF STANDARDS
The National Bureau of Standards was established by the Congress to
provide essential scientific services to Government, business, industry, and
science. As custodian of the national standards of physical measurement,

A N N U A L R EPO R T O F T H E SECR ETA RY O F COM M ERCE

the Bureau is the ultimate source in this country for the thousands of
standards used in mass production of interchangeable parts, in the develop
ment of new products and devices, in the commercial exchange of goods,
and in the precise measurement of scientific quantities.
Through calibration services, the Bureau insures the accuracy of count
less industrial and scientific instruments and working standards by compar
ing them with the national standards. It also conducts the research in
physical measurement that is necessary to meet the ever-increasing demands
of science and industry for new or improved measurement standards.
The Bureau studies, evaluates, and precisely measures the properties of
substances and materials, providing a sound basis for their industrial and
scientific utilization. It applies the resulting data and techniques in devis
ing methods of testing materials, in developing specifications for Govern
ment purchase, in developing building and safety codes, and in testing
materials purchased by the Government.
The background in precise measurement provided by the basic work in
standards and properties of materials enables the Bureau to serve the Gov
ernment and the Nation in a variety of other ways. For example, it ren
ders advisory services to Federal agencies on technical problems, invents
and develops devices to meet special needs of the Government, and con
ducts research investigations in such fields as aerodynamics and nuclear
physics. The overall program is thus quite broad in scope, embracing a
large number of projects in physics, mathematics, chemistry, metallurgy,
and various branches of engineering.
Progress has been made in strengthening of the Bureau’s basic technical
program by a gradual shifting of Bureau personnel to work involving
standards and methods of measurement and by a reduction in the amount
of development work done for other agencies. New work has been per
formed in the fields of length, temperature, radio and new sample standards
and research in radio propagation and radiation safety.
Specific accomplishments of the Bureau included:

Essential scientific research leading and contributing to the discovery of “forward
scatter,” a new and more effective mode of radio communication.
Extensive work in the field of automatic electronic data-processing devices and
computers, including valuable services to other Government agencies seeking to
automatize their procurement, paper processing, and other procedures.
Valuable contributions to the field of high-temperature physics and high-tempera
ture materials critical to the more effective use of modern and future engines.
Services to the Nation’s building and construction industries in the study of new
building materials, such as lightweight mass-produced concrete, and the extension
of new safety codes.
Organization of a new central electronics facility to serve as a standardization
center for electronic devices used by the Armed Forces.
Continuous research on the problem of radiation standards, including interna
tional agreement on technical aspects of these standards, and the development of
various types of monitors for protective observation of radioactivity.
407217— 57-

A N NUAL REPO R T OF T H E SECRETA RY OF COM M ERCE

Development of several new spectrographics standards for use in steel production.
Extension of the precision for measuring length using atomic sources.
Refinement of the techniques of chemical purification and analysis for use in the
standard samples program used by industry.
Extensive materials research on plastics and high polymers.
Development of a portable standard for use in comparing certain electrical
standards.

Authorization was granted to acquire a new site for the National Bu
reau of Standards to house a new and more modern facility consistent with
the requirements of modem science and technology.
During the fiscal year 1956, the following expenditures were made:
Expenses, $7,250,000; plant and equipment, $525,000; other, NBS, $225,000; transferred from other agencies, $14,000,000; total, $22,000,000.

Office of the Under Secretary
for Transportation
The Under Secretary of Commerce for Transportation serves as the
Secretary’s principal adviser on transportation matters and is responsible
by delegation from the Secretary for coordination of overall transportation
policy within the executive branch. In addition, he provides policy direc
tion for the transportation agencies within the Department and coordinates
their programs and activities. These agencies are the Bureau of Public
Roads, Civil Aeronautics Administration, Defense Air Transportation Ad
ministration, Maritime Administraton, and Weather Bureau.
Demands for increased and improved transportation services accompany
ing the steady expansion and progress in the Nation’s economy have resulted
in a considerable expansion in the programs of these primary operating
agencies during this fiscal year.
The Federal Aid Highway Act of 1956 provides for the modernization
of the 41,000-mile interstate highway system over the next 13 years with
the Federal Government assuming 90 percent ($25 billion) of the total
cost. The act also further increased Federal participation in the construc
tion of primary, secondary, and urban highway systems to $850 million in
fiscal year 1958 and to $875 million in fiscal year 1959.
Necessary planning was completed and budgetary authority was ob
tained for commencing a 3-year $246-million program designed to expand
and improve the Nation’s air traffic control and air navigation systems.
The Federal-aid airport program was stepped up substantially during the
year as a result of legislation which provides for airport development during
this and the next 3 years at a level of $63 million per year.
Merchant shipbuilding activity continues at record peacetime levels.
During this fiscal year 68 ships representing about $500 million in contracts

ANNUAL REPO R T O F T H E SECRETA RY O F COM M ERCE

were under construction and conversion on the basis of negotiations during
the year. It is expected that about $505 million worth of new work in
volving 56 ships will be undertaken in the coming year. Ship operators
are financing their share of the total cost with private funds.
The Weather Bureau continued to make progress during the year in
modernizing the Nation’s weather services. Outstanding among many
significant improvements have been the establishment of research centers
and widespread installation of radar and other equipment for the early
detection and better tracking of severe storms; the expansion of forecasting
services, particularly the 5-day forecasts, the continuous broadcast of avia
tion weather information, and the establishment of public service teletype
loops in more than 50 cities; and the advancement in numerical weather
prediction techniques which make possible for the first time the solving of
meteorological problems which heretofore have been unsolvable.
The Under Secretary for Transportation assisted the Secretary of Com
merce in presenting the Department’s extensive testimony to a subcommittee
of the House Interstate and Foreign Commerce Committee in support of
legislation proposed by the Department in the previous year to implement
the recommendations of the President’s Advisory Committee on Transport
Policy and Organization.
Based upon the conclusions of an interagency study of navigational clear
ances for highway and railroad bridges sponsored by the Department of
Commerce, legislation was prepared proposing that Government officials
having responsibility for fixing bridge clearances across navigable waters
shall base their decisions on public interest in all forms of transportation
and not be confined to the protection of the interests of public navigation.
This change could effect substantial savings for the public without seriously
interfering with waterway commerce. The savings possible are particularly
emphasized in light of the vast new highway program.
The Office of the Under Secretary for Transportation participated
throughout the year in interdepartmental and international deliberations
by various organizations on key transportation problems and policy issues.
These organizations included the President’s Air Coordinating Committee,
the Air Navigation Development Board, the National Advisory Committee
for Aeronautics, the International Civil Aviation Organization, the Office
of Defense Mobilization Transportation and Storage Committee, and the
Interagency Committee on Water Resources.
Substantial progress was made in all of these areas. Included in this
activity was the adoption of a detailed plan for the mobilization of the
Nation’s transportation resources in the event of an emergency and virtual
agreement on the adoption of a common civil and military system for auto
matic determination of position and distance of aircraft in flight. A de
tailed program for a census of transportation was developed in cooperation
with the Bureau of Census for approval by the Secretary.

ANN U A L REPO R T OF T H E SECR ETA RY OF COM M ERCE

CIVIL AERONAUTICS ADMINISTRATION
The Civil Aeronautics Administration fosters the safe and expeditious
movement of aircraft through three major programs. It builds and
operates a system of air navigation and traffic control. It assists communi
ties in the improvement of airports. It administers the safety standards for
aircraft and airmen.
During the 1956 fiscal year a greatly enlarged airport program was under
taken and the groundwork was laid for a vast expansion of the airway
system. These activities were made possible by new obligational author
ity of $197,300,000, compared with $131,400,000 in fiscal 1955. CAA had
17,110 employees on the rolls at the end of the 1956 fiscal year.

Federal Airways

Continued heavy increases in air traffic intensified the work on improve
ments in the control system. Typical of the growth in volume was a 15
percent increase in revenue passenger-miles flown by United States domestic
scheduled air carriers, from 18.3 billion in fiscal 1955 to 21.1 billion in fiscal
1956. Executive and military aircraft movements also rose, the latter ac
counting for 43 percent of the activity at CAA air route traffic control cen
ters. Measured in terms of aircraft position reports showing 22,890,576
postings, the centers were 23 percent busier than in fiscal 1955.
To cope with the growing traffic, CAA submitted to Congress the FiveYear Federal Airway Plan, calling for expenditure of $246 million on new
facilities. A total of $75 million, including a supplemental appropriation
aimed at telescoping the program into 3 years, was voted as an initial in
stallment.
Long-range radar with associated direct communications between con
troller and pilot was an essential element of the program. A start on longrange radar operations was made by relocating the New York facility to
permanent quarters, by installing facilities at Chicago and Norfolk, and by
negotiating with the military for use of defense radars in traffic control.
To take advantage of radar’s possibilities for expediting traffic, facilities
for direct communication between CAA controllers and pilots en route
were increased substantially during the year in order to eliminate the time
lag involved in relaying communications.
Other facilities added during the year included 16 omnidirectional radio
ranges, 3 airport surveillance radars, and 2 approach light systems. Im
provements providing greater accuracy were made at approximately 80
existing omnidirectional ranges. Production was underway on equipment
for 47 additional locations. Procurement of 30 additional approach light
systems was initiated. The number of miles of airways based on omni
directional ranges was increased from 74,000 to 85,404.
Four long-range navigational aids for transoceanic flights were being
installed. One at Atlantic City, N. J., and one at Nantucket Island, Mass.,

A N NUAL R EPO R T O F T H E SECRETA RY OF COM M ERCE

were near completion. Two in California were at an earlier stage of com
pletion.
Installations of ultra-high frequency air-ground communications for mil
itary aircraft were made at 500 CAA facilities. Also to meet military needs,
a Central Altitude Reservation Facility was established at Kansas City, Mo.,
to coordinate all military altitude reservation requests.
Procedural improvements included elimination of 200 compulsory re
porting points for aircraft above 15,200 feet, reducing workload for both
pilots and controllers and cutting communications delays due to frequency
congestion.
A year-long experiment in the Washington area with special high-den
sity traffic rules showed that speed limits, two-way radio, and stricter visi
bility requirements resulted in improved traffic handling. It was recom
mended to the Civil Aeronautics Board that the Administrator be given
power to designate zones where such rules would apply.
A highly accelerated program of training air traffic controllers was begun
with a class of 80 newly employed personnel, the first group of approxi
mately 6,000 expected to be hired in the next 5 years.
At the close of the year, the former Office of Federal Airways was divided
into the Office of Air Traffic Control, responsible for the operation of the
traffic control system, and the Office of Air Navigation Facilities, respon
sible for design, procurement and maintenance of the complex electronic
facilities required in the system. Both functions have taken on major im
portance in recent years.

Aviation Safety

In carrying out its responsibility for aircraft safety from drawing board
to repair shop, CAA issued certificates of approval for 6 new transport
aircraft, 5 new types of helicopters, and 12 models in the small aircraft
field. Work was begun on applications for type certification of the first
two United States jet transports, the Boeing 707 and the Douglas DC-8,
and on the Lockheed Electra turboprop and the Fairchild M-185 jetpowered executive transport. Applications were received from foreign
manufacturers for approval of 14 transport aircraft—9 of them turbine
powered, 3 personal types, and 2 helicopters.
During the fiscal year, 45 engine approvals were granted, and type certif
icates were issued for 52 propeller models.
Civil aircraft production, all of which is conducted under CAA safety
controls, increased heavily. Aircraft output was 6,072, an increase of 60
percent over the previous year. Engine production was 9,582, a gain of
43 percent. Propeller production rose 28 percent to 14,000.
As part of its program of assisting owners to keep their aircraft airworthy
throughout the period of service, CAA issued 25 airworthiness directive
cards containing 57 mandatory notes. In addition, 300 Daily Mechanical

A N NUAL REPO R T OF T H E SECRETA RY OF COM M ERCE

Reports were circulated, covering some 1,700 mechanical difficulties ex
perienced by air carriers.
A major change in the inspection system for general (nonair carrier)
aircraft, simplifying the procedure while maintaining the safety standard,
was accomplished during the fiscal year.
During the fiscal year, 72,031 airman certificates were issued and 48,999
student pilot applications were processed. The first airline transport pilot
rating in jet aircraft was issued.
CAA took a leading part in establishing a training course for aerial
applicator pilots at Texas Agricultural and Mechanical College.

Airports

Major changes in the Federal-aid airport program by Public Law 211,
84th Congress, 1st session, signed by the President on August 3, 1955,
included—

Removal of the time limit of 1958, established by the original act, as amended
in 1950.
Elimination of the provision for annual appropriations and the establishment in
lieu thereof of a 4-year program with obligational authority for $42.5 million for
fiscal 1956, in addition to the $20 million appropriated by Public Law 121, and $63
million for each of the fiscal years 1957, 1958, and 1959.
Elimination of the overall appropriation limit of $5.2 million.
Inclusion of language emphasizing that airport buildings are eligible items of
development.
Indirect removal of restrictive criteria for eligibility of airports by the stipulation
in the law that all types and sizes of airports are eligible.
Provision that funds apportioned each year on an area-population formula would
remain available for 2 years in each State prior to being withdrawn and reapportioned.

As a result of these changes, allocations of Federal aid to communities
for airport improvement were the largest ever during fiscal 1956. A 205airport program involving $19,364,078 in Federal funds was announced
August 10, 1955, followed by allocations of $38,932,065 for 319 airports
on February 9, 1956, and a fiscal 1957 program of $51,863,177 for 368
communities announced on June 12, 1956.
Washington National Airport, operated by CAA, set new records.
Passengers totaled 3,815,418, increasing 12.1 percent, and aircraft move
ments, totaling 240,890 were up 13.3 percent. To meet the greater needs,
an apron paving project was substantially completed during the year. Plans
were prepared for two new baggage rooms, an additional “finger” build
ing for four new gate positions, a cargo building, high-speed taxiways, and
improved aircraft fueling facilities. Airport income of $2,275,563 exceeded
operating costs by $835,470.

Planning, Research, and Development

The CAA Jet Age Planning Group was established to work with in
dustry and other Government agencies. Its starting point was a preliminary

A N NUAL REPO R T OF T H E SECRETA RY O F COM M ERCE

list of 100 jet-age problems developed as a result of a symposium called
together by the Administrator in January.
Varied activities at the CAA Technical Development Center at Indian
apolis included testing the use of traffic information obtained by microwave relay from a remote air defense radar, inservice improvements of
the Instrument Landing System to overcome problems at difficult sites,
work on the radar beacon and on TACAN for civil use, and tests of bird
impact on the windshield of a new jet transport. The center also estab
lished a branch in the Boston area to work with military research facilities
there on possible integration of air defense and civil air traffic control
systems.

International Operations

Considerable progress was made toward worldwide adoption of a com
mon system of air navigation and traffic control, particularly in widespread
installation of omnidirectional radio ranges. At the close of the fiscal
year, 60 such units were operating in countries other than the United
States and Canada, with 95 more in various stages of procurement. Ap
proximately $3 million in United States funds was obligated during the
fiscal year to assist 12 nations in the purchase and installation of aviation
ground aids.
CAA missions provided technical assistance in 24 nations, and 167
foreign nationals came to the United States for training under CAA
supervision, an increase of 50 percent over the previous year. In addition,
554 officials of foreign governments and foreign air enterprises paid short
visits to United States aviation facilities under CAA auspices.

Training

The CAA Aeronautical Center at Oklahoma City continued to expand
its technical training operation, graduating 1,490 students during the
fiscal year, an increase of 25 percent over 1955. By subject, the trainees
were divided as follows: 687, air traffic control; 400, electronics; 350,
aviation safety; and 53, flight inspection.
In aviation safety, emphasis was shifted from piston engines to turbines,
both turboprop and turbojet, in preparation for the jet transport era. The
turbojet powerplant course was attended by top maintenance officers from
leading United States air carriers and a major oil company.

Employee Safety

With a safety program directed by a full-time officer, the employee injury
frequency rate was cut 9 percent in calendar 1955. This record earned
an award from the Department of Commerce for an outstanding achieve
ment in view of the “many potential hazards” involved in CAA work.

A N N U A L REPO R T OF T H E SECR ETA RY OF COM M ERCE

DEFENSE AIR TRANSPORTATION ADMINISTRATION

The Defense Air Transportation Administration is responsible for plan
ning and directing the mobilization of United States civil aviation resources
for effective utilization in the event of war.
A major function of DATA is to allocate airlift between the Civil
Reserve Air Fleet (CRAF) for direct support of the military in time
of war, and the War Air Service Pattern (WASP) in continued commercial
operation to carry war-essential traffic under an air priorities system.
This allocation is periodically adjusted for changes in the Nation’s war
plans, essential industry needs, and changes in the inventory of aircraft.
The CRAF includes approximately one-third of the total airlift of the
civil airlines, to be operated under contract in direct support of the Military
Air Transport Service (MATS) on 48-hour notice, using civil aircraft,
personnel, and maintenance facilities. The joint efforts of DATA, MATS,
and the airlines have resulted in detailed operational plans and essential
stockpiles embodied in a military emergency war plan.
The WASP is that part of the total airlift of the civil air carriers which
would be required for a war economy. Plans have been made to carry
only essential air traffic, based upon an air priorities system with policies
jointly determined by DATA and the Department of Defense and with
administration within the office of the Secretary of Defense. Under the
system, priority traffic requires certification as to both essentiality and
urgency.
A critical requirement for mobilizing civil aviation is highly skilled avia
tion manpower. DATA is continuing its work with the industry and with
military representatives to devise methods for reducing the estimated short
age of skilled manpower. The Administrator of DATA serves as chairman
of the Interdepartmental Aviation Manpower Committee established by
the Office of Defense Mobilization to consider broader aspects of these
problems.
DATA has produced plans for the civil-defense use of scheduled and
nonscheduled airline aircraft, and noncarrier transport-type aircraft. Such
requirements for airline and military transport aircraft would be met
through the air priorities system; private- and corporate-owned transporttype aircraft will be utilized through the National Emergency Defense Air
lift plan.
DATA is ODM’s delegate agency for making recommendations on ac
celerated tax amortization necessity certificates for commercial transport
aircraft. The interim goal for 900 transport aircraft was filled in 1956,
and a request for an increase in the goal was pending.

MARITIME ADMINISTRATION
The Maritime Administration is responsible for fostering an American
merchant marine sufficient to carry the waterborne commerce of the Nation

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and capable of serving as a naval auxiliary in time of emergency or war.
Its functions include the construction, repair, and operation of merchant
ships, maintenance of national defense reserve fleets of Government-owned
ships, administration of operating and construction-differential subsidy pro
grams and other Government aids to shipping, maintenance of reserve
shipyards for ship construction in national emergencies, training of merchant
marine officers, and administration of a grant-in-aid program for State
maritime academies.
During fiscal 1956 the Maritime Administration continued its efforts
to effect a revitalization of the postwar merchant marine.

Construction and Operating Aid

In promoting the merchant marine, major accomplishments of the past
year included the negotiation of operating-differential contracts providing
for “phased” ship replacement programs by the subsidized operators. Ef
forts were directed to this area because the modernization and planned ship
construction program of the entire American merchant marine is largely
geared to and influenced by the replacement programs of the 16 subsidized
operators.
New operating-differential subsidy contracts, effective under termination
of current contracts, with ship replacement provisions (ships to be con
structed during the period 1957—70) were executed as follows: Grace Line,
Inc., 26 vessels; Moore-McCormack Lines, Inc., 33; Oceanic Steamship Co.,
4; American President Lines, Ltd., 14; and Pacific Far East Lines, 5. In
addition, by the end of the year negotiations were in process with three
additional subsidized operators: Lykes Bros. Steamship Co., Inc., Mis
sissippi Shipping Co., Inc., and Seas Shipping Co. Negotiations were con
templated with Farrell Lines and American Mail Line, Ltd., for the exe
cution of new operating subsidy contracts, under the provisions of which
these operators would be required to replace 105 vessels with new con
struction.
In addition, 5 construction-differential contracts were executed with
subsidized operators for the construction or conversion of 16 ships, and 3
ship mortgage and loan insurance contracts were negotiated for the con
version of 3 ships and the construction of 1 barge.

Shipbuilding and Repair

The past year saw the country embark on the largest peacetime ship
building program in history, resulting in a major step to prevent block
obsolescence of merchant ships, to provide a modem and efficient mer
chant marine, and to assure the retention of ship construction know-how
by management and workers.
The magnitude of this program during fiscal 1956 is illustrated by these
facts: (1) Sixty-eight ships were under construction, conversion, or
reconditioning or were on order in United States shipyards, providing in

A N NUAL REPO R T OF T H E SECR ETA RY OF COM M ERCE

excess of $525 million in work; (2) construction and conversion of an
estimated 57 ships were to begin in fiscal 1957, providing $505 million
in work; and (3) contracts were executed or being negotiated, or negotia
tions were contemplated with subsidized operators, for some 185 ships over
the next 15 years. This program would utilize private initiative and capital
with a minimum of Government assistance in the form of constructiondifferential subsidy, Government mortgage aid, or ship trade-in allowances.
The United States merchant marine must constantly improve its ship
design for greater efficiency and economy, both to meet foreign competition
and to fulfill its responsibilities in the event of national emergency. In
the past year plans were substantially completed for: (1) 7 prototype
designs including a T5 Pipeline tanker and 6 cargo ships; (2) 4 designs
for the Navy, including 2 cargo ships, 1 tanker, and 1 auxiliary cargo ship
(dock); (3) a number of designs of ships to be constructed under operat
ing or construction-differential subsidy agreements, including cargo, pas
senger, combination passenger, and trailer ships; (4) the development
of ship designs for the application of nuclear power to merchant ships;
and (5) the developmental design and experiment with Liberty-type
ships involving modification of hull lines, and the installation of new
propulsion equipment and modified cargo-handling gear.
Material progress was also achieved in improving the mobilization readi
ness of ships in the National Defense Reserve Fleets through (1) the repair
of 60 Navy auxiliary-type ships, which together with ships repaired in
fiscal year 1955 brought to 150 the number of ships repaired at a cost of
$17,535,000 under the emergency ship repair program, and (2) sub
stantial completion of 4 Liberty-type ship conversions. Tests indicated
that the speed of the Liberty ships would be increased from approximately
10 to 15 knots, or better, which was in line with design expectations. The
successful conversions are important to the national defense in view of
the fact that 1,496 Liberty ships are in the National Defense Reserve Fleet.

Operation of Ships

The number of privately owned ships of 1,000 gross tons or over in the
United States merchant fleet declined from 1,101 to 1,070. In terms of
deadweight tonnage, these ships represented 10 percent of the tonnage
in the world’s merchant ships over 1,000 gross tons as compared to 11
percent at the end of the previous year.
The operation of merchant ships by general agents for Government
account declined to a low of seven ships in December 1955. Increased
requirements during the spring of 1956 resulted in placing 26 additional
ships in operation to meet the requirements of the Military Sea Transporta
tion Service. At the end of the fiscal year 43 Maritime Administration ships
were in the custody of other Government agencies and 22 were under
bareboat charter to private operators.

A N NUAL REPO R T OF T H E SECRETA RY OF CO M M ERCE

As of June 30, 1956, there were 2,061 ships in the reserve fleets. The
ship preservation program progressed steadily, within the limitations of
available manpower, with 98 percent of basic lay-up and preservation work
completed.

Grain Storage

The Maritime Administration continued its cooperative arrangement
with the Department of Agriculture under which ships in the National
Defense Reserve Fleet are utilized for the storage of Government pricesupport wheat. At the end of the fiscal year, 330 ships at the Hudson
River, James River, Astoria, and Olympia reserve fleet sites were loaded
with approximately 76 million bushels of grain. Since the inception of
this program in 1953 the reserve fleet has been utilized for the storage
of approximately 101 million bushels of grain.

Ship Sales and Transfers

A total of 13 vessels of the Mariner type were sold for $62,880,799 for
operation in the foreign commerce of the United States under the authority
of the Merchant Marine Act of 1936, as amended. These ships together
with seven of this type sold in fiscal year 1955, not only augmented
the American-flag fleet of modern cargo ships with speeds matching foreign
competition but also returned in excess of $97 million to the United States
Treasury. Four other ships were sold to American companies for passenger
or commercial services and two were sold for scrap.
The delivery of 4 ships, plus the sale and transfer of 2 privately owned
vessels and the planned delivery of 2 additional ships to Korea early in
fiscal 1957 will fulfill the provisions of Public Law 665, 83d Congress. The
sales price of the 6 Government-owned ships was $4,163,000.
Under sections 9 and 37 of the Shipping Act of 1916, 800 ships were
transferred to foreign ownership or to foreign registry, although United
States citizens remained owners. Of the total, 706 were ships of less than
1,000 gross tons—such as tugs, barges, fishing craft, and pleasure craft—
and 94 were of 1,000 gross tons and over.

Other Activities

M a ritim e T r a in in g .—Public Law 415 was signed by the President on
February 26, 1956, making the United States Merchant Marine Academy a
permanent institution similar to the regular service academies. During the
fiscal year the Academy graduated 154 men. State maritime academies
graduated 277.
P r o per t y and S u p p l y ..—The maintenance and security program was
continued at four Government-owned reserve shipyards. Permits and
leases were granted or continued to other agencies or private organizations
for the use of substantial portions of the land, structures, and equipment at
these shipyards and at two terminals.

A N NUAL R EPO R T O F T H E SECRETA RY O F COM M ERCE

F in a n c ia l M a t t e r s .— A total of $725,000 was recovered from under
writers under the recapture provisions of the wartime Protection and In
demnity Insurance Agreement. Total recoveries received amounted to
$61 million, representing $13,525,000 from hull underwriters and $47,475,000 from the protection and indemnity underwriters.
L egal M a t t e r s .— The most significant legal activity was that involving
claims against the Government under the Merchant Ship Sales Act of 1946.
Seventy-one cases were pending in the Court of Claims and the district
courts in which refunds of additional hire were claimed under postwar
charters of war-built vessels for the offshore trade under the Merchant Ship
Sales Act of 1946. This category of cases involved potential claims totaling
an estimated $40 million. A decision of the United States Circuit Court of
Appeals, Second Circuit, in the case of Sword Line, Inc. v. United States,
was of material concern to the Government. This decision, affirmed by
the Supreme Court, held that litigation involving the alleged invalidity of
charters of war-built vessels was within the jurisdiction of the district courts
and was time-barred under the 2-year statute of limitations. The case
was considered a precedent and, accordingly, the Government moved for
the dismissal of 41 other cases in the same category still pending in the
Court of Claims.
Investigations continued through the year to determine whether certain
purchasers of ships under the Merchant Ship Sales Act of 1946, as amended,
qualified as United States citizens. As a result of these and prior investi
gations, the Government during the year realized $181,000 in fines, $15,289,000 in cash settlements, and $430,000 in waiver of claims against the Gov
ernment.

BUREAU OF PUBLIC ROADS

The Bureau of Public Roads represents the Federal Government in mat
ters relating to highways.
Reflecting the ever-growing importance of highway transport in produc
tion, distribution, and defense, the Bureau’s functions cover a broad range
of engineering, administrative, and research activities. It supervises the
expenditure of funds granted the States for highway improvement and su
pervises road construction in national forests, parks, and parkways. On oc
casion it furnishes highway engineering aid to other Federal agencies.
A prime objective of the Bureau is to help the States plan and develop
modern highway systems adequate to the Nation’s needs. The general
character of this cooperative relation is fixed by law, but long experience
with highway problems in the 48 States has enabled the Bureau to focus
its research and engineering efforts on the most essential aspects of highway
improvement, design standards, and traffic control.
The problem was pointed up by the fact that both motor-vehicle registra
tions and urban and rural traffic volumes reached new peaks. Motor ve-

A N N U A L REPO R T O F T H E SECR ETA RY O F COM M ERCE

hides were expected to total 65 million by the end of the 1956 calendar
year—a gain of about 2.5 million in 12 months. Mileage traveled on
streets and roads increased 5.3 percent in the fiscal year.

Federal-Aid Highway Act of 1 9 5 6

During fiscal 1956 the Bureau cooperated with the States in planning
and carrying out a record volume of highway improvement. In addition,
the Bureau played a significant role in shaping the Federal-Aid Highway
Act of 1956. Based in part on earlier Bureau studies of highway needs,
this huge 13- to 15-year program for the national system of interstate and
defense highways will provide a 41,000-mile network of modern roads and
expressways connecting all 48 States and linking 90 percent of the cities of
more than 50,000 population.
The 1956 act authorizes nearly $25 billion of Federal funds for the inter
state sytsem. This sum, together with about $2.6 billion contributed by
the States, will provide a coast-to-coast system designed to meet the traffic
anticipated in 1975—more than 90 million vehicles. All but about 7,000
miles of this system—in lightly traveled areas—will consist of 4- to 8-lane
divided highways, with urban connections, interchanges, and bypasses.
Planned access will bring new standards of motoring comfort, efficiency, and
safety.
The 1956 act also provides increased Federal aid for highways other than
those in the interstate system. Prior authorizations were increased $125 mil
lion to a total of $825 million for fiscal 1957; $850 million was authorized
for fiscal 1958, and $875 million was authorized for 1959. These amounts
are to be divided 45 percent for the Federal-aid primary system, 30 percent
for the secondary system, and 25 percent for urban highways.
The new act directs the Bureau to make several important studies on
such matters as reimbursement for toll and free roads which may be in
cluded in the interstate system, the equity of highway taxation, highway
safety, and a series of reports dealing with the cost of completing the inter
state system.
Title II of the act requires earmarking and putting into a highway trust
fund revenues estimated to reach nearly $38.5 billion in the 16-year period
begun July 1, 1956. About two-thirds of this amount will come from
highway taxes that were already in effect when the act was passed. Onethird will come from new taxes and increases in present rates.
Alaska for the first time is included in Federal-aid apportionments.
Functions of the Department of the Interior relating to highways in Alaska
are transferred to the Bureau.
While the new legislation presents the Bureau with a challenging task,
the general plan of operation will continue the long-established policy of
Federal-State cooperation which began in 1916.

ANNUAL REPO R T OF T H E SECRETA RY O F COM M ERCE

Federal-Aid Program

The Federal-aid highway program gathered momentum during the year
in response to the increase in the annual authorization rate from $575
million for fiscal 1954 to the $875 million for fiscal 1956 provided by the
Federal-Aid Flighway Act of 1954. The apportionment of $875 million
authorized for fiscal 1957 was made on August 9, 1955. Additional 1957
funds totaling $1,125 million, provided by the Federal-Aid Highway Act
of 1956, were apportioned June 29, 1956, but had no effect on activity
during the fiscal year.
Completions of all classes of Federal-aid projects during the year ac
counted for the improvement of 23,828 miles of roads. Included were
6,673 miles of highways and 1,290 bridges on the Federal-aid primary sys
tem outside of cities; 957 miles of highways and 599 bridges on urban
portions of the Federal-aid primary system; 15,289 miles of roads and 1,886
bridges on secondary or farm-to-market roads; and 909 miles of highways
in national forests, parks, and parkways, and on flood-relief projects. The
long-range program to end hazards at railway-highway grade crossings
was advanced by elimination of 212 crossings, reconstruction of 27 inade
quate grade-crossing structures, and protection of 305 crossings by the in
stallation of flashing lights or other safety devices.
There was good progress in construction of highways of all classes. Sec
tions of expressways were under construction in nearly all large cities, many
miles of main highways between cities were improved, monumental bridges
across large waterways were being built, and the rapid construction of sec
ondary roads continued. Since the beginning of the program under the
1944 act, 125,193 miles of Federal-aid secondary system improvements
have been completed in 3,006 counties. The new simplified plan for
administration of the Federal-aid secondary program, initiated under the
provisions of the 1954 act, was operative in 37 States.

Highway Design Standards

Approval of the Federal-Aid Highway Act of 1956 assured construction
on the interstate system of controlled access highways connecting and pass
ing through or skirting the principal urban areas of the country and many
smaller cities. Glearcut policies and standards became necessary for the
expeditious and uniform planning and designing of facilities to be provided
by this program.
The 1956 act called for the adoption of geometric and construction
standards for the interstate system in cooperation with the State highway
departments. The American Association of State Highway Officials, with
Public Roads cooperation, undertook a revision of its standards adopted
in 1945 for the interstate system. (The revised standards were completed
and approved by the Bureau on July 17, 1956.)

ANNUAL REPO R T OF T H E SECR ETA RY O F COM M ERCE

These standards, together with more detailed policy statements covering
rural highways and arterial highways in urban areas, prepare the way for
the use of uniform and up-to-date design criteria, thus providing for effec
tive execution of the interstate system program and for those highway
features which will yield the maximum degree of safety and utility. The
policies are, of course, equally useful in the design of rural roads and
arterial urban highways apart from the interstate system.

Research Activities

The Bureau further advanced its studies of highway finance, highway
transport, and the broad array of physical problems associated with high
way construction. New emphasis was placed on studies of the durability of
highways and related structures.
A notable example of the latter is the Bureau’s active participation in a
large-scale cooperative investigation of the performance of both rigid and
nonrigid pavements and of highway bridges under controlled traffic. The
extensive research, sponsored by the American Association of State High
way Officials and directed by the Highway Research Board, is commonly
known as the AASHO Road Test.

WEATHER BUREAU
As the Nation’s meteorological service, the Weather Bureau is responsible
for furnishing weather and climatic information for the Nation’s safety,
health, and economic welfare. During fiscal 1956 four especially important
steps were taken to improve these services. A 4-year program of modern
izing meteorological equipment was started. Forecast and warning services
were strengthened through improved communications facilities. Certain
basic meteorological services which had been financed and performed by
the military were transferred to the Weather Bureau. And, most important,
the Weather Bureau’s program of research on hurricanes and other severe
storms was greatly expanded.

Modern Meteorological Equipment and Facilities

Seven and one-half million dollars, available over a 4-year period, was
included in the Weather Bureau appropriation for 1956 to replace ob
solete meteorological instruments and facilities. This will permit the Bureau
to take full advantage of the rapid progress that has been made in the
development of meteorological observing equipment during the past few
years.
The establishment of a modern nationwide network of storm-warning
radar weather stations is the outstanding feature of this rehabilitation pro
gram. Radar sets now being used are modified military sets which were
not originally built for weather surveillance. The new sets are specially

A N NUAL R EPO R T O F T H E SECR ETA RY O F COM M ERCE

designed to detect and track storms over as much as a 200,000-square-mile
area. They not only will permit the issuance of earlier and more accurate
local storm warnings, but also are expected to provide new and important
data for research purposes.
Automatic tracking radiotheodolites for obtaining soundings of the
atmosphere up to 80,000 feet are being acquired for stations in the upperair network. Improved cloud-height and visibility-measuring equipment
will be installed at 45 of the Nation’s busier airports. Automatic equip
ment for recording surface wind will be available at an additional 100
Weather Bureau offices. Other much needed meteorological equipment to
be acquired includes remote reading thermometers, automatic water-stage
indicators, and severe weather research equipment.

Forecast and Warning Services

Following an unusually large number of weather disasters, specialists in
observing, forecasting, and communications arranged a series of conferences,
workshops, and seminars. These meetings were intended to bring out
ways of strengthening the Bureau’s severe-weather warning services. It
was concluded that more and better weather observations over the oceans
were a necessity.
As a result the number of merchant ships participating in weather re
porting was sharply increased. Several hundred selected United States
vessels were to be equipped with precision marine-type meteorological
instruments. In addition, the program of obtaining upper-air data from
merchant vessels was extended to include 3 ships operating in the Gulf
of Mexico, 2 in the Atlantic between Baltimore and San Juan, and 2
in the Pacific between San Francisco and Japan.
Communication channels were streamlined and extended. Occasionally
in past years, during critical storm situations, reports were delayed in
reaching Weather Bureau offices because communications facilities were
overloaded. Similarly, hurricane, tornado, and other severe-weather in
formation was delayed in reaching the public because of the limited capacity
of dissemination facilities. Arrangements were made to connect every
coastal office from Brownsville, Tex., to Portland, Maine, by a special
teletype warning circuit during the hurricane season.
Additional weather maps were made available in a number of field
stations by means of facsimile transmission. Interphone and teletypewriter
circuits for the exchange of radar observations and other severe local
storm information were placed in operation in the Midwest during the
tornado season. Arrangements were made for long-distance telephone
circuits to go into operation when regular channels reach their capacity.
In addition, 58 commercial radio stations were included in the Bureau’s
direct weather broadcast program, bringing the number of participating
stations to about 700.

A N NUAL R EPO R T OF T H E SECR ETA RY O F COM M ERCE

The Weather Bureau office in Miami was designated National Hurricane
Information Center. Hurricane forecasts and warnings for the entire
Gulf and Atlantic coastal regions were to be coordinated through this
center.
Weather prediction by numerical methods, through the use of a high
speed electronic computer, was performed on a daily basis throughout the
fiscal year 1956. From this experience it was determined that computation
of prognostic charts by an electronic computer on a regular daily basis is
definitely practical. The quality of the computer-produced prognoses has
improved as errors in methods of prediction have been isolated and cor
rected. Progress in weather prediction by numerical methods offers great
promise for the future.
In the field of hydrology the way was paved for the most widespread
extension since 1948 of modern river forecasting techniques. River Fore
cast Centers were established at Hartford, Conn., for New England, and
at Augusta, Ga., for the Southeast. Forecasts by these offices were in
augurated in parts of these two areas during March and April 1956,
replacing and augmenting the previously limited forecast program. De
velopment of new forecast procedures was also begun for the Middle
Atlantic States, including the Raritan and Passaic Rivers in New Jersey.
A start was made in developing special composite forecast procedures for
tidewater reaches where both runoff from rainfall and storm tide combine
to produce high stages. The total overall strengthening of forecast and
warning services cost about $3,750,000 during the year.

Coordination With Department of Defense

More than $2 million was provided in this year’s appropriation to carry
out a recommendation made by the Joint Meteorological Committee, an
interagency group that coordinates meteorological activities nationally,
that certain basic meteorological functions be transferred to the Weather
Bureau.
Analyzed charts and prognostic maps prepared in the Weather Analysis
Center at Washington are basic forecasting tools used throughout the
field service of the Weather Bureau and the meteorological activities of the
Department of Defense. In the past the activity was jointly supported by
funds and staff from both agencies. The center came under full Weather
Bureau financial and staff support during the year.
Preparation and publication of historical Northern Hemisphere weather
maps was another important activity in this transfer program. Prepara
tion of these maps was begun during World War II as an aid to forecasting
in areas where weather observations were denied the United States as a
result of the hostilities. In addition, they are invaluable tools in current
weather forecasting and in basic research into the circulation of the
atmosphere.

A N NUAL REPO R T OF T H E SECR ETA RY OF COM M ERCE

During the year, the Weather Bureau also assumed the operation of 16
upper-air observation stations which had been operated by the Military
Establishment. The remaining eight stations in the network, which are
financed and staffed by the Department of Defense, will be transferred to
the Weather Bureau next year.

Severe Storm Research

To develop better techniques for forecasting hurricanes, tornadoes, and
other weather disasters, the Weather Bureau began the most comprehensive
research of severe storms ever undertaken.
To investigate tropical disturbances of the type that develop into hurri
canes, a National Hurricane Research Project was established in West
Palm Beach, Fla. This project includes the cooperation or active partici
pation of outstanding authorities on tropical meteorology from universities
and other institutions as well as other Government agencies. The intensive
data collection program includes the establishment of a dense network
of upper-air sounding balloon stations in cooperation with governments
in the Caribbean area and research flights into hurricanes by specially
equipped planes of the Department of Defense. Data thus collected will
be processed at the Field Research Base by the latest machine methods.
The greatest loss of life in hurricanes usually comes from the surge of
sea water which accompanies the passage of the storm over the coastline.
A program was therefore developed to improve methods for predicting
the heights of storm-induced coastal floods along the Atlantic and Gulf
coasts. This includes the organization of a small research and development
group, assignment of specialists to important key coastal points, and spon- i
sorship of oceanographic research at universities and other institutions.
In the field of tornado and severe local storm research, additional
studies on the character of tornado damage, structure of tornadoes, and
improved forecasting techniques were sponsored at a number of univer
sities and research institutions. A special project to fly a P-51 airplane
into areas of potential tornado development was also initiated to obtain '
more complete data regarding atmospheric conditions responsible for
tornado formation.
Special pilot projects were established in Iowa and Oklahoma to deal
with flash floods. These projects combine radar detecting and tracking
of heavy rainfall by the Weather Bureau with self-help forecast and warn
ing procedures previously provided the communities as a part of the '
cooperative plan. In addition, studies were under way at two universities
on a contract basis to improve utilization of radar for estimating rainfall
amounts.
The total increase in expenditures for research activities was approxi
mately $1 million during the fiscal year.

A N NUAL REPO R T O F T H E SECR ETA RY OF COM M ERCE

International Geophysical Year

Although the International Geophysical Year, a period designated by
international agreement during which participating nations will make
scientific measurements and studies of the earth, its oceans and atmosphere,
does not begin until July 1, 1957, the United States part of the program,
particularly the Antarctic phase, was started during fiscal 1956. Twentyone Weather Bureau meteorologists were to be among 75 scientists de
parting for Antarctica in the autumn of 1956. Equipment for the six
United States Antarctic stations has already been procured and shipped.
The Weather Bureau also has the responsibility, given the United States
by the other nations, of maintaining a weather forecast central in Little
America to receive and distribute weather information to all nations
engaged in Antarctic activities.
Negotiations were started with Ecuador, Peru, and Chile to establish five
complete meteorological stations on the west coast of South America. USIGY will supply the equipment and instructors, and the cooperating coun
tries will furnish the quarters and observers.
The Weather Bureau is assisting in the planning and the establishment of
two US-IGY stations on the Arctic ice pack—one on the Ice Island T—3 and
the other on the pack itself north of Point Barrow. This program is sup
ported by funds transferred to the Weather Bureau and when completed
will approximate $2 million.

future Work Plans

Field activities and public services previously described were to be con
tinued in 1957 without major change. Nevertheless, continued attention
is to be given to internal adjustments that will streamline and improve pub
lic services. In addition, plans provide for some strengthening of weather
services to agriculture in critical areas subject to a high potential loss from
adverse weather by assigning specialists to work closely with agricultural
interests. Some added stations were to be designated State centers and
assigned forecast responsibility for the State in which the center is located.
Weather services to aviation were to be increased in cooperation with
the Civil Aeronautics Administration by the inclusion of aviation weather
broadcasts on low-frequency air navigational ranges at approximately 36
locations. New rainfall and river stage reporting stations were to be es
tablished in the Northeastern States as aids in forecasting river stages and
flood conditions. More States were to be encouraged to participate in the
cooperative program with State agricultural colleges for processing cli
matological weather records of the State by machine methods. And, the
frequency of upper-air observations from MSTS vessels in the Pacific were
to be increased in cooperation with the Navy.

A N NUAL R EPO R T OF T H E SECRETA RY OF COM M ERCE

Added appropriations for 1957 were requested primarily to establish on
an annual basis and extend the severe-storm research started during fiscal
1956. Included in work plans for severe-storm research were: The award
ing of additional contracts with universities and other organizations staffed
and equipped to make certain specialized studies; operation of the Hurri
cane Research Base at West Palm Beach, Fla., for the first time during a
hurricane season; completion of the upper-air network in the Caribbean
in cooperation with foreign governments; continuation of regularly sched
uled flights during the hurricane season by specially equipped aircraft in
cooperation with the Department of Defense; and additional observations,
some from an aircraft equipped with meteorological instruments, in poten
tial tornado areas for study by research staff in Washington and at the
Severe Local Storm Warning Center, Kansas City, Mo.
Increased emphasis has been placed on training and recruitment of scien
tific personnel as well as on the awarding of scholarships to outstanding
Weather Bureau employees, because the number of students graduating
from colleges and universities with training in meteorology is inadequate
to meet the Bureau’s replacement needs.
Deliveries of equipment ordered in 1956 to modernize the Bureau’s ob
servational stations were to start in 1957, with field installation to start as
soon as deliveries are received. It was planned to expand housing accom
modations at remote Alaskan localities to provide a one-family unit for
each employee, thus permitting the employment of married male personnel.

Office of the Assistant Secretary
for International Affairs

The Assistant Secretary of Commerce for International Affairs acts as
principal adviser to the Secretary for the development and implementation
of international trade policies and in this connection participates in inter- *
agency committees either as the Secretary’s alternate or as the Department
of Commerce representative. He also provides policy direction and guid
ance to the Bureau of Foreign Commerce and the Office of International
Trade Fairs.
Over the years the Department has developed information and other
resources of value to businessmen in their trading and investment opera
tions. The Department contributes to the expansion of trade and invest
ment to the extent to which its resources are known and brought to bear
on the problems of traders and investors. With this in mind, the Depart
ment’s Bureau of Foreign Commerce has been reorganized during the last
year so as to emphasize in its program the importance of expanding the
circle of business users of its services.

ANNUAL REPO R T O F T H E SECR ETA RY OF COM M ERCE

To develop a corps of Foreign Service officers sensitive to and trained
in the needs of business, the Departments of Commerce and State have
agreed upon an expanded interservice assignment program. About 20
Foreign Service officers a year will be assigned to the Department of Com
merce to fill full-time jobs in the Department. A similar number of Com
merce officers will be assigned to the Foreign Service as Foreign Service
Reserve officers. This program, together with the supplementary action
by the Congress to increase the budget of the economic and commercial
part of the Foreign Service, should in time develop more active and effec
tively implemented trade promotional operations by the Foreign Service.
This Office has participated in the decisions of the Council on Foreign
Economic Policy, the National Advisory Council on International Monetary
and Financial Problems, and other interdepartmental committees involved
in matters which affect the foreign economic and commercial policies of
the United States.
The Export Control Act was extended for 2 years, continuing the Gov
ernment’s authority to regulate exports for the reasons of national security,
foreign policy, and short supply. In April 1956, the Department estab
lished a list of peaceful goods which could be exported to European Soviet
bloc countries without prior individual license approval. Short-supply
controls were maintained over nickel, copper, aluminum, selenium, in
dustrial diamonds, Salk vaccine, and iron and steel scrap.
The International Trade Fair Program, administered by the Office of
International Trade Fairs with participation by the Bureau of Foreign
Commerce, presented joint Government-industry exhibits at 18 inter
national trade fairs. Products of American industry and examples of the
way Americans live, work, and spend their leisure time were featured.
Teams of Government and industry specialists were present at most locations
to answer business inquiries and to promote two-way trade.

BUREAU OF FOREIGN COMMERCE
Organizational changes were made in the Bureau to put new emphasis
on acquainting the business community with the services of the Bureau and
on tailoring the services more closely to the needs of foreign traders and
investors. Through approved publications, closer relations with the busi
ness community, and a wider dissemination of opportunities for business
abroad, Bureau business services were extended to a larger number of firms
concerned with international trade, travel, and investment. The Bureau
continued to carry out its responsibilities in reducing barriers to interna
tional trade through participation in tariff negotiations and through pre
paratory work incident to the negotiation of treaties to facilitate inter
national trade, travel, and investment.

ANN U A L REPO R T O F T H E SECR ETA RY OF COM M ERCE

Direct Services to Business

The Foreign Commerce Weekly, published by the Bureau, has approxi
mately 8,000 subscribers. It covers current developments in foreign coun
tries that affect trade and investment and brings to the attention of its sub
scribers opportunities for the expansion of trade and investment abroad.
A series of publications, the World Trade Information Service, provides
essential information to traders and investors on business conditions and
methods in more than 100 countries and areas of the world. During 1956,
258 separate country subjects were added to this series, bringing the total
available to 471. The total subscription to this series is approximately
2,800. Plans were made to present to the business community the value
of these two publication series as a “package” for business firms engaged
in doing business abroad.
More than 3,000 business opportunities abroad, obtained through the
Foreign Service and trade missions, were made available through trade as
sociations and private publications as well as through Bureau publications.
A survey of results in one European area revealed that business contacts
were established in a high percentage of the opportunities presented.
Interest in protection of industrial property rights abroad more than
quadrupled during the year. United States and foreign business firms re
quested the assistance of the Bureau in settling 2,200 claims which grew
out of foreign trade transactions.
A biweekly publication, Investment Opportunities Abroad, reached more
than 4,000 prospective investors and covered 700 specific investment and
licensing opportunities. Although it is difficult to measure results of this
operation in terms of investments actually made, 923 requests for further 1
information were received following a press release announcing one spe
cific opportunity. Investment handbooks providing United States busi
ness with complete basic information were published for the Philippines,
Mexico, Japan, Indonesia, and the Federation of Rhodesia and Nyasaland.
Similar publications covering Central America, Cuba, Australia, and Tur
key were, in press at the end of the fiscal year, while a manuscript on Peru '
was being completed.
Valuable statistical studies dealing with international travel were pub
lished for the travel industry. Assistance was rendered to national and
international organizations in bringing about action on travel development
programs abroad and in simplifyng regulatons affecting travel.
United States trade missions sent abroad by BFC in connection with
the international trade fair program of the Department met with more
than 78,000 businessmen in 19 countries in the past 2 years. Private busi
nessmen and Government representatives who made up the missions manned
information centers at the United States central exhibits and visited 161
cities of industrial and trading potential. Local businessmen partici
pated in group discussions with the trade panels or accepted invitations to

ANN U A L REPO R T O F T H E SECR ETA RY O F COM M ERCE

engage in private discussions with the United States missions. They were
assisted in making United States trade connections. More than 10,000 spe
cific opportunities for international trade and investment were thus de
veloped.
The Bureau continued to provide the business community with informa
tion and advice on all matters affecting United States trade and investment
in foreign countries. The various specialized Bureau personnel handled
more than 30,000 requests for information and advice from visitors to the
Bureau, in addition to approximately 450,000 requests handled through the
field service.
Trade conferences were reinstituted at Department of Commerce field
offices for Foreign Service officers who have completed a tour of duty abroad.
Plans were made to assign a larger number of career Bureau personnel to
commercial work in the Foreign Service and for their replacement by For
eign Service officers in order to improve the services to the business com
munity.
Customs procedures in connection with foreign trade zone operations
were liberalized. This will benefit traders and should result in a greater
volume of business for the zones.
The Bureau’s facilities and services for identifying and supplying infor
mation on oversea distributors, dealers, representatives, sources of supply,
and other types of trade connections were augmented by 2,460 new trade
lists classified by commodity, industry, or service organization. The dis
tribution of trade lists to business concerns totaled 25,452. Supplementing
the trade list service, approximately 14,000 detailed descriptions of indi
vidual foreign firms ( World Trade Directory Reports) were purchased by
the business community.

Promoting CommerceThrough Reduction of Barriers

Bureau representatives participated in the tariff negotiation conference
in Geneva from January 18 to May 23 under the auspices of the General
r Agreement on Tariffs and Trade. In that conference, the United States
received tariff concessions from 21 countries. During the year, the Bureau
also participated in the renegotiation of existing concessions with 13 coun
tries. Bilateral discussions were initiated with various foreign countries on
specific trade problems growing out of balance-of-payments restrictions im
posed on United States imports.
The Bureau has devoted considerable effort to analysis of United States
foregn trade, in order to help formulate the United States position on trade
questions both in international forums dealing with liberalization of imports
from the dollar area and in bilateral negotiations with individual foreign
governments.
Working through United States Embassies abroad, the Bureau advised
► various foreign governments on draft legislation affecting United States
foreign investment and United States foreign insurance activities.

ANN U A L REPO R T O F T H E SECR ETA RY OF COM M ERCE

The Bureau continued to participate in the United States delegations
to the United Nations Economic and Social Council, the Economic Com
mission for Asia and the Far East, the Economic Commission for Latin
America, and the Organization of American States.

Control of Strategic and Short-Supply Exports

Despite a case-load level well in excess of that estimated for budget pur
poses, the Bureau was able during the year to achieve the best performance
to date in processing export license applications. Approximately 94 per
cent of all applications were acted upon within 5 days of receipt. Within
10 days of receipt, 99 percent of all applications were processed. The
remaining 1 percent required special investigation or policy review.
A list of nonstrategic goods involving 700 items which could be exported
to the European Soviet bloc without prior individual license approval was
established in April 1956. Exports under this general license have been
negligible. Exports to the bloc of materials under validated licenses con
tinued to rise during 1956 as compared with the 2 previous years, but were
still very small as compared with 1947.
In the enforcement of export controls warning letters, criminal penalties,
customs seizures, and export denial orders were issued against 600 foreign
and American individuals and firms.
In addition to the Comprehensive Export Bulletin, which is purchased
on subscription by more than 6,000 firms, the Bureau published a handbook,
The Carrier’s Role in Export Control, summarizing the principal provisions
of the export control regulations affecting carrier operations. This hand
book deals particularly with destination-control provisions and documentconformity regulations, both of which are important in the control of trans
shipments and unauthorized diversions of commodities of United States
origin.

OFFICE OF INTERNATIONAL TRADE FAIRS
The international trade fair program was inaugurated in September 1954
at the direction of the President so that the Government and industry might
avail themselves effectively of such fairs to promote two-way trade and tell
the story of American life and institutions.
In the last fiscal year, the United States took part in a greater number of
international trade fairs in the so-called underdeveloped countries and in
neutralist or uncommitted countries. Soviet-block countries, meanwhile,
substantially increased the size and scope of their exhibits and also
participated in a greater number of fairs.
During fiscal 1956, official United States exhibits were shown at 18 trade
fairs throughout the world. Central exhibits were mounted at 16 locations.
Trade information centers were an integral part of the presentations
at 14 locations. At two locations, trade information centers were this

ANNUAL REPO R T OF T H E SECRETA RY OF COM M ERCE

country’s entire participation. Exhibits ranged in size from small booths
housing teams of Government and industry marketing and foreign trade
specialists at Hanover, Germany, and Lyons, France, to a mammoth display
at New Delhi, India, occupying over 60,000 square feet and featuring an
atoms-for-peace exhibit as well as closed-circuit television and a large num
ber of industrial products.
Variations of “Industry in the Service of Man,” the basic theme of all
United States exhibits, were used to depict appropriate segments of the
American scene. These included peaceful uses of atomic energy, a model
American home, agricultural progress, and “do-it-yourself,” activities.
Thousands of products from a cross section of American industry together
were used to implement the themes.
In addition to mounting the fairs comprising the program for fiscal 1956,
much work was done in preparation for fairs scheduled in early fiscal 1957.
Selecting the fairs in which the United States will participate and deter
mining the type and extent of participation and an appropriate theme
for each are the responsibility of the Trade Fair Subcommittee of the Oper
ations Coordinating Board. Memembership of the subcommittee consists
of representatives from the Departments of Commerce and State and the
United States Information Agency. The Office of International Trade
Fairs and the Bureau of Foreign Commerce carry out the determinations
of the subcommittee and conduct all operations.
Many of the products displayed and the services of executives and mar
keting specialists as members of trade teams were contributed at no cost
to the Government. In addition, consulting services of some of the best
qualified groups and individuals in the fields of advertising and display have
been utilized. Moreover, private industry appears to have increased its in
dependent participation in international trade fairs as a direct result of
Government participation and encouragement.
Reaction to United States participation in international trade fairs was
enthusiastic in business circles and in the press, both in the United States and
in the countries where this country was represented. Over 11.5 million
visitors attended United States exhibits during the year. Almost without
exception attendance at the United States exhibit was far greater than at
other exhibits.

Office of the Assistant Secretary
for Domestic Affairs
The Assistant Secretary of Commerce for Domestic Affairs is the Secre
tary’s principal assistant in fostering, promoting, and developing the
( domestic industry and commerce of the United States. Under the Secre
tary, his function is to assure that the domestic program and activities of the
Department result in the fullest contribution to a sound economy.

ANNUAL REPO R T OF T H E SECR ETA RY O F COM M ERCE

The Assistant Secretary of Commerce for Domestic Affairs serves the
business community in gaining proper representation of business views,
opinions, and problems in governmental affairs. Stability and growth
of the Nation are promoted through the maintenance of a proper economic
environment in which free competitive enterprise may grow and prosper.
These views and opinions play an important part in the policymaking and
guidance of the Business and Defense Services Administration, Office of
Field Services, Office of Technical Services, Office of Area Development,
Office of Business Economics, and Bureau of the Census.
Under provisions of the Defense Production Act, as amended, support
was given to currently authorized military and atomic energy programs by
channeling scarce materials to meet defense production projects on schedule.
The defense materials system was expanded by adding nickel alloys to the
list of controlled materials effective the fourth quarter of 1956. Mobiliza
tion preparedness programs were strengthened. Activities in the fields of
industrial defense, stockpiling, tax amortization, expansion goals, develop
ment of standby orders and regulations, and special assistance through
priorities and directives, as well as other programs, were carried on in
cooperation with the Office of Defense Mobilization and other defense
agencies. Largely through BDSA the domestic commerce area cooperated
closely with the foreign activities of the Department.
The program of collecting reports of Government-sponsored technical
research and making them available to American science and industry was
widened by greater acquisition efforts to obtain more new product and
process reports and through arrangements with the Atomic Energy Com
mission last August whereby their unclassified material would be distributed
through the facilities of the Office of Technical Services.
During the past year, the Office of Area Development increased its serv
ices to community development groups and to utilities, railroads, and private
firms concerned with plant location problems. More than 400 communities
were provided with technical assistance in initiating and carrying out area
development problems. The Congress increased the budget appropriation
of the Office from $127,000 to $377,000 for fiscal 1957. This increase will
allow the Office to provide more on-the-spot assistance in the field and to
strengthen its services to labor surplus areas.
The provision of facts on the overall status and growth of the Nation’s
economy is one of the basic functions of the Department, and the monthly
magazine Survey of Current Business, prepared in the Office of Business
Economics, is one of the leading periodicals for business use. Carrying on
its work on national income and product, the Office of Business Economics
has completed an extensive report on the purchasing power and relative
size of the regional markets, under the title “Personal Income by States.”
The principal focus is on the growth and changes in the geographic dis

A N NUAL REPO R T OF T H E SECRETA RY OF COM M ERCE

tribution of income over the past quarter of a century—changes featuring
pervasive shifts in the industrial and commercial structure of the Nation,
and a considerable narrowing of the relative differentials in area purchasing
power.
Continuing growth of the Nation and expansion of trade and industrial
activity are revealed in results of major censuses and current statistical
surveys conducted by the Bureau of the Census. Total population of the
country has passed the 168-million mark, representing a gain of 16 million
since the 1950 census. Attainment of record levels in employment, domestic
and foreign trade, industrial activity, and State and local government
revenues and expenditures has also been recorded by the Census Bureau
during the past year. To keep abreast of the Nation’s growth, the Bureau
of the Census is continuing its efforts to improve the quality and timeliness
of its data and to develop more efficient methods and procedures for per
forming its work.

BUSINESS AND DEFENSE SERVICES ADMINISTRATION
The Business and Defense Services Administration follows a pattern of
operations designed to facilitate an unprecedented rate of combined mil
itary and civilian production. A major part of its activities are related to
the Defense Production Act of 1950, as amended.
During the last fiscal year BDSA also carried on its general services to
business: Studies of domestic and world trade and marketing, reducing
Government industrial competition with private enterprise, market impact
studies of proposed sales of Federal surpluses of personal property, and the
issuance of a series of informational and technical publications.

Defense and Mobilization Preparedness Activities

S pec ia l A s sis t a n c e f o r M ilita ry and AEC P r o g ra m s .—BDSA con
tinued its directive actions to provide scarce materials for military and
atomic energy production. During the 12 months ended September 30,
1956, BDSA processed 11,382 special assistance cases, representing a 64percent increase over the previous year. Acceleration of radar, aircraft,
and missile programs accounted for this increase. Areas of tight supply
remained essentially unchanged.
O per a tio n o f t h e D e f e n s e M aterials S y s t e m .—This System, estab
lished in 1953, has been fulfilling one of its main objectives, the on-schedule
delivery of materials and products for military and AEG production and
construction. Advance planning generated a number of pro forma pro
cedures, limitation orders, and delegations designed to carry out the DMS
plan if required for mobilization. Prudent estimates of nuclear attack
effects were calculated by BDSA and ODM to evaluate the adequacy and
* location factors of production facilities.

ANNUAL R EPO R T OF T H E SECRETA RY OF COM M ERCE

Operations Affecting Basic Materials

I r o n and S t e e l .—All iron and steel requirements of the defense program
were met in full throughout the first three quarters of the fiscal year. Dur
ing these quarters, production set-asides were adjusted, as required, to pro
vide full coverage of changing defense needs, and special assistance to ex
pedite deliveries against defense orders was provided wherever necessary.
Nickel alloys were added to the list of controlled materials during the
fiscal year, effective the fourth quarter 1956. Reporting forms were de
veloped for the collection of data on shipments of nickel-bearing materials
against defense orders, by DMS program symbols, to begin October 1956.
The importance of iron and steel scrap as a raw material and the necessity
of obtaining additional information to aid the Government in its policy de
terminations with respect to such matters in export control and mobiliza
tion planning led the Congress, in June 1956, to direct the Department of
Commerce to “make a complete survey of the iron and steel scrap available
and potentially available.” This survey was to be made by an outside
research organization under the general direction of full-time BDSA em
ployees. A supplementary survey, the findings of which were to become a j
part of the overall survey, covered “prompt” industrial scrap only.
A new study of full mobilization requirements for steel was begun in con
junction with other Government agencies, under the general supervision
of the Office of Defense Mobilization.
The Office of Defense Mobilization requested that a survey of defense
rated orders be made for selected months of 1955 and 1956. During the
fiscal year appropriate action was taken on these requests and the informa
tion was prepared for analysis.
C o p p e r .—The copper supply-demand situation loomed so critical dur
ing the year that deliveries of refined copper to Government account were
deferred, and diverted to industrial consumers.
A l u m in u m and M a g n e s iu m .—During the year, BDSA made determina
tions of aluminum set-asides for military and AEC programs. For the
fiscal year these set-asides amounted to approximately 590 million pounds.
M is c e l l a n e o u s M et a l s and M in e r a l s .—The supply and use of ti
tanium, bort, diamond powder, mica, mercury, selenium, tin, lead, zinc,
and other minerals were constantly checked to determine whether DMS
provisions should be applied.
O t h e r A c t io n s .—The “machine tool trigger program” was developed
with the cooperation of industry, the General Services Administration,
ODM, and the Department of Defense to provide standby firm orders for
types and designs of machine tools believed to be immediately essential
under mobilization conditions.
A thorough study of current production and potential productivity of
approximately 60 categories of critical component parts was about one-third ^
completed during fiscal 1956.

A N NUAL REPO R T OF T H E SECRETA RY OF COM M ERCE

Industrial defense programs, including plant protection, were discussed
with more than 300 companies which expressed a desire to undertake such
advance planning.
BDSA branch offices were established in New England after the floods
in the fall of 1955 to alleviate defense production facility damage and to
expedite delivery of necessary materials. Similar assistance was provided
to manufacturing concerns in the Pacific Northwest following the floods
there. This activity was administered through the Department’s field office
in San Francisco.

, Tax Amortization and Expansion Goals

During fiscal 1956 the Industry Divisions of BDSA considered and made
recommendations to ODM, the certifying authority, on more than 1,000
tax amortization cases. Approximately 512 were new cases filed under
expansion goals in the open category. Requests for rapid amortization
were concentrated in areas relating directly to national defense.
■
A considerable number of goals were closed. However, 16 expansion
goals remained open and in the active category at the close of the year.

Compliance and Enforcement

As a step toward strengthening and improving investigative procedures,
BDSA issued Regulation 8, Compliance and Enforcement Procedures, May
15, 1956. This regulation provides for exercise of the subpena and other
investigation powers in simpler and speedier form than had theretofore
been available.
Although the emphasis at the end of fiscal 1956 was on nickel, the Com
pliance and Enforcement staff handled other violations of the Defense Pro
duction Act as they arose. Such cases were relatively few. A fairly sub
stantial violation in the aluminum field and one concerning selenium were
► dealt with administratively with satisfactory results.

Executive Reserve Program

►

A major activity undertaken by BDSA during the past year was the im
plementation of its part in the executive reserve program, authorized by
section 710(e) of the Defense Production Act, Executive Order 10660 of
February 16, 1956, and Defense Mobilization Order 1-21.
As the first step in launching the program, the Secretary sent a letter to
over 400 companies which had furnished WOC (without compensation)
personnel to the Government, enlisting their support. Following the Sec
retary’s letter, the Administrator of BDSA issued over 600 invitations to
former WOC’s to join the Executive Reserve. As of June 30, 1956, 311
statements of understanding had been filed by potential reservists and 83
reservists had been designated by the Secretary of Commerce.

A N N U A L R EPO R T O F T H E SECR ETA RY O F COM M ERCE

Assistance for Small Business

BDSA’s activities on behalf of small business were illustrated by its actions
in connection with the flood disasters, the machine tool program, tax amor
tization and actions to aid in securing scarce materials and to divert from
stockpile.
Efforts were made to prevent the leasing of machine tools to manufactur
ers for use in the production of items indirectly or not at all connected with
defense production. This position by BDSA was predicated on the theory
that such distribution of machine tools could seriously affect the competitive
position of smaller concerns which might not know about the availability
of such tools or how to secure them.
A representative of the Department, in collaboration with representa
tives of other agencies, worked with ODM to review the participation of
small business in Government contracts and to make recommendations.
The Department recommended placing on each procurement agency the
responsibility for equitable distribution of contracts to small firms, the pay
ment of interest on overdue accounts with small suppliers, the adoption of
commercial standards for an increased number of items purchased, and the
revision of many Federal specifications. The ODM report was submitted
to the President and to the Congress.
Requests from smaller manufacturers for “hard to get” materials or for
an increase in their current acquisition of such materials were thoroughly
and carefully reviewed by appropriate industry divisions although alloca
tion for nondefense production was no longer authorized, informal devices
for assistance were employed when hardship not common to the industry
was substantiated.
A series of “clinics,” or 1-day seminars, was held, in collaboration with
the Small Business Administration, to acquaint small concerns with Govern
ment facilities available to them and especially with the aids provided in
matters of mobilization and defense.

Developments in Taxation and Fiscal Policy

During the fiscal year the Department, through a special staff unit of
BDSA, made a continuous review of policies and practices pertaining to
taxes, credit, interest rates, and business financing. Reports were developed
as recommendations for departmental position in testimony before com
mittees of the Congress, for the Secretary’s action as a member of the Small
Business Administration Loan Board, and for discussion with the Cabinet.

Economic Impact Studies—Surplus Disposal

Under voluntary mutual agreement between BDSA and the Office of the
Assistant Secretary of Defense for Supply and Logistics, the professional
services of the industry divisions and Office of Distribution staffs continued
to provide comment on proposed sales of large quantities of surplus com-

ANN U A L REPO R T O F T H E SECR ETA RY OF COM M ERCE

mon-use items. BDSA conducted studies and commented to the Depart
ment of Defense concerning impact on inventory position, price, and em
ployment stability which might result if specified quantities of certain items
of surplus were sold.

Other Activities

Although somewhat reduced in industry coverage and in frequency, the
general pattern of Industry Advisory Committee meetings, task-force ses
sions, and higher echelon executive conferences was maintained in meetings
held during the year.
BDSA took part in the Geneva conferences on reciprocal trade agree
ments, including the top-level discussions, recommendations, and agree
ments of that session.

OFFICE OF AREA DEVELOPMENT
The past fiscal year was highlighted by a considerable expansion of Office
of Area Development services to community, State, and regional develop
ment organizations. More than 400 communities in 46 States requested
and received industrial and area development assistance in fiscal 1956. Of
the technical assistance made available to communities and cities, more than
70 percent went to towns of 10,000 or under, 25 percent to cities in the
10,000 to 50,000 group, and 5 percent to cities of 100,000 or more. Seventy
State and regional development organizations were assisted on survey pro
cedures for determining industrial and commercial expansion possibilities.
During the year, business firms, railroads, and utilities increased their
inquiries relating to plant location problems. Some 180 industrial and
utility firms were counseled on problems of plant location and provided
with data on area assets for industry.
Services to development groups in labor surplus areas were also ex
panded. Industry was informed of the industrial location advantages of
labor surplus areas through direct meetings with industrial executives. The
brochure Locational Advantages of Labor Surplus Areas was published
and widely distributed to industry. Industrial survey reports, a bulletin
service reporting the successful area development experiences of other com
munities, and new product and technology exhibits constituted other new
services to labor surplus areas.
The Office served as consultant to the sponsors of the New England
“New Products, New Methods, and New Patents” exhibit held in Boston
March 26-29, 1956, to make available ideas for new products and new
processes resulting from Government research. The Office coordinated the
participation of the Army, Navy, Air Force, Atomic Energy Commission,
Small Business Administration, and the Departments of Commerce, Labor,
and Interior in this effort. More than 90 percent of some 6,000 New

A N NUAL REPO RT OF T H E SECRETA RY OF COM M ERCE

England industrial and business executives in attendance reported the ex
hibit to be of benefit to them.
The Office also participated in the rural development program of the
Department of Agriculture. Representatives of the Office assisted more
than 50 test counties participating in the program on the industrial development phases of their efforts. Examples of survey reports and materials
prepared by the Office for use in this program are Small Industries for Low
Income Areas and Memorandum to Northeast Vermont Development
Association.
The Congress increased the budget appropriation of the Office of Area
Development from $127,000 to $377,000, allowing further expansion of
services during fiscal 1957. The enlarged program was to include more onthe-spot counseling in the field, the development of more information on
the industrial potentialities of labor surplus areas, a larger number of newproduct and new-process exhibits held in labor surplus areas, and additional
technical assistance to rural low-income areas on problems of developing
small industry and business possibilities.
OFFICE OF FIELD SERVICES
Services to business by the Department through field offices located in
33 cities continued at a high level throughout the year. Representing the
Business and Defense Services Administration, the Bureau of Foreign Com
merce, the Bureau of the Census, and the Office of Business Economics,
the field offices give the business public local access to reports on technological developments and the trade promotion facilities of the
Department.
Working closely with the various primary units of the Department, the
field offices provide services to manufacturers, wholesalers, retailers, trade
publications, trade associations, advertising agencies, research groups,
financial institutions, and exporters and importers in the field of foreign and
domestic commerce.
In domestic commerce the principal interest is centered on market re
search, in which the reports and publications of the BDSA’s Office of Dis
tribution and of the OBE, together with the vast array of census material
which became available during the year, are of great value. Increased use
of research information gathered by the Office of Technical Services in the
development of new products and industrial processes reflected the value
placed upon such data by small businessmen in improving their manufacturing techniques. There also was wide interest in Government contracts
as evidenced by circulation of the Synopsis of U. S. Government Proposed
Procurement, Sales and Contract Awards, published daily by the Office of
Field Services in cooperation with the military and civilian procurement
offices of the Federal Government.

„

A N N U A L REPO R T O F T H E SECR ETA RY O F COM M ERCE

»
I

The business service functions of BDSA’s industry divisions were ex
panded in the field as the result of the high level of business activity
achieved during the past year. The field offices also worked closely with
the Office of Area Development in making its services available to industrial
development organizations, chambers of commerce, and similar groups.
Utilizing exhibits and graphic material prepared by units of the Department,
field offices also participated in meetings of national trade associations,
business conventions, and trade exhibitions designed to keep the business
public informed on the reports, publications, and services of the Department.
Foreign trade again occupied an important place in the work of the field
offices. Many exporters sought opportunities to expand their overseas
business, and importers looked for new sources of raw materials and manu
factured goods. The relaxation and simplification of export controls eased
the demand for assistance on export control problems. A special effort
was made to improve upon quality and volume of reference material so
that the field offices might provide accurate and current information on
business developments overseas.
The foreign trade program is based upon long experience in this field,
and in carrying it out the facilities of BFC, the Bureau of the Census, the
Foreign Service, and the International Cooperation Administration are
relied upon. Trade promotion and development accounts for a major
part of the foreign trade field program. This work involves a wide variety
of information relating to tariffs of foreign countries, import and export
statistics, control and exchange regulations, investment and licensing oppor
tunities, and assistance on the many problems involved in export and import
trade. Both exports and imports have been maintained at a very high
level during the past year, reflecting in the demands made upon the field
offices.
Cooperating with the BFC, the Office of Field Services provided selected
personnel for duty with United States trade missions at international trade
fairs in which the United States participated officially. The offices also
followed up on trade leads developed by the missions, enabling a number of
American firms to establish connections with overseas buyers and suppliers.
The field offices continued to maintain close contact with the 800 coopera
tive offices of the Department maintained by chambers of commerce and
like organizations. This service has been of particular value to small-busi
ness men as it gives them local contacts with the services of the Department.
OFFICE OF TECHNICAL SERVICES
This Office collects technical information for dissemination to scientific
and industrial laboratories and business enterprises; helps industries develop
and agree upon commercial standards as to quality, testing, and ratings;
serves as the point of contact with trade associations, and other nonprofit

A N NUAL REPO R T O F T H E SECRETA RY OF COM M ERCE

trade groups for the purpose of encouraging their cooperation and obtaining
recommendations with respect to the domestic commerce programs and
activities of the Department; and brings to the attention of American in
ventors the technical problems of the national defense agencies.

T echnical Information

Government-financed research continues to exceed $2 billion a year, rep
resenting more than half of the Nation’s total research effort. The tech
nical reports growing out of this research are of direct interest to American
industry, for they describe new developments in such fields as metals,
chemicals, plastics, electronics, textiles, ceramics, and aeronautics. Using
such information obtained from OTS, many businesses—small, medium,
and large—have developed new products and processes and made impor
tant technological improvements.
During the past year 8,000 new reports of Government research were
added to the OTS collection of over 250,000 technical documents available
to the public. Several thousand of them were acquired from the Atomic
Energy Commission after OTS became sales agency for the AEC’s nonclassified material in August 1955. This arrangement with the AEC ma
terially strengthened the office’s service to industry in providing a large
amount of technical material useful in the peaceful development of the
atom. Particular effort was directed last year toward acquisition of newproduct and new-process reports of use to the small plant. Also of special
value to small business is a volume, published by OTS, of abstracts of 908
Government-owned patents released by the Government Patents Board
for royalty-free use by the public.
During the year 38,700 inquiries were answered regarding technical
reports in the OTS collection, and $245,174 worth of reports were sold by
OTS and the Library of Congress at an average price of $1.50 to $2 per
report. This was an increase of $54,000 over the previous year, reflecting
increased industry use of Government research. This wider service is also
reflected in the increase in subscriptions to OTS’s monthly publications.
Paid circulation of U. S. Government Research Reports, which describes
300 or more new reports of research in each issue, increased from 3,500 to
5,000; subscriptions to Technical Reports Newsletter, which each month
abstracts 15 to 20 new reports of particular interest to small and mediumsize businesses, increased from 1,200 to 3,500. The OTS staff of technolo
gists continued to answer technical questions from American industry as
well as to provide, under contract, technical information to the Interna
tional Cooperation Administration for use in its program of global assistance.

Commodity Standards

Requests for assistance from industry in the establishment and promulga
tion of Commercial Standards and Simplified Practice Recommendations
increased last year. Thirteen Commercial Standards and nine Simplified

A N NUAL REPO R T O F T H E SECRETA RY OF COM M ERCE

Practice Recommendations were issued, while work progressed on nine
other Simplified Practice Recommendations and twenty-four Commercial
Standards. Requests for assistance in establishing new Commercial Stand
ards increased particularly in the plywood, lumber, and millwork field and
► in the plastics field. In the development of Simplified Practice Recom
mendations, the container and packaging area continued to be very active.
Of special interest is the 1955 Supplement to Commercial Standard CS8-51,
Gage Blanks, established at the request of the Department of Defense. The
use of this standard minimizes the need for special gages, thus avoiding in
creased costs and delays that could result from special requirements.
>

Trade Associations

Advisory service to the Office of the Secretary on matters pertaining to
business associations is provided by this Office, which is the Government
center of information in the field. It has issued directories of trade as
sociations for more than 40 years, carries on continuous studies of their
• growth and activities, and encourages all Government agencies to utilize
the facilities of associations in cooperative programs. Major publications
prepared during the year include Directory of National Trade Associations.

National Inventors Council

The Council, serving in an advisory capacity to inventors and the De
partment of Defense, received several thousand ideas for the solution of
problems affecting national defense, many having apparent value to the
Armed Services. The Council devoted much of its time to consideration
of the development and stimulation of the Nation’s creative ability, par
ticularly as directed to defense. With the assistance of the military es
tablishment, it embarked on an expanded program to utilize more fully
the inventive ingenuity of the American people.

OFFICE OF BUSINESS ECONOMICS
Through its monthly publication Survey of Current Business, the Office
of Business Economics monthly furnishes the business community with a
concise record of the Nation’s economic progress. Perhaps the principal
barometer is the gross national product, which last year reached an annual
' rate in excess of $400 billion for the first time in our history. Associated
with this measure of economic activity are OBE’s data on the national in
come and the balance of international payments, as well as monthly personal
income, consumer expenditures for goods and services, and past and future
business outlays for new plant and equipment.
In September 1955 OBE put on sale a new edition of its basic supplement
‘ to the Survey of Current Business called Business Statistics. Containing
over 2,600 business indicators, with monthly data for the previous 4 years
and annual averages back to 1929, this enlarged edition provided a con

A N NUAL R EPO R T OF T H E SECRETA RY OF COM M ERCE

sistent historical record for all of the market measures regularly reported
in the monthly magazine.
During the last year another of OBE’s series of basic market data was
completed for publication under the title Personal Income By States. The
State income estimates detailed here for the first time were heralded by the
appearance of summary data in the September 1955 Survey of Current
Business. Superseding OBE’s State income payments series initiated in the
late 1930’s, these estimates are the outgrowth of a major research project
that extended over a period of years. This accomplished a significant im
provement in the statistical basis of the State income measures. The new
personal income figures embody a thorough reworking of the statistics back
to 1929—a task marking the incorporation of many additional data sources
and improved estimating techniques.
Among the major articles appearing in the Survey itself was the June
1956 report “Income Distribution in the United States, 1952-55,” which
presented estimates of the distribution of families and family income by in
come brackets for the previous 4 years, together with summary data for
selected earlier years. Indicative of the range of OBE’s materials, the same
magazine furnished reports showing that businessmen expected to spend $35
billion in 1956 for new plant and equipment; that the number of business
concerns in operation in the United States was at its highest point, over
4*4 million; that in the previous year Americans spent more than $1.6
billion for foreign travel, by far the highest amount yet recorded; and that
U. S. grant and credit payments to foreign countries were at an annual
total of $4.6 billion in the fiscal year 1956.
Aside from its preparation of material for public use by the business
community, the Office of Business Economics works closely with the Council
of Economic Advisers and the Congressional Joint Committee on the Eco
nomic Report, furnishing information necessary for policy decisions and
the delineation of Government programs.

BUREAU OF THE CENSUS
The Bureau of the Census is responsible for periodically collecting and
compiling data on the Nation’s social and economic resources. The sub
jects covered in Census programs are authorized through basic legislation.
Complete censuses of the population, housing, agriculture, and selected
segments of industry, trade, and governments are conducted at specified
periods. Current statistical information in these fields and on foreign
trade is compiled annually or at more frequent intervals in order to provide
interim and up-to-date measures of conditions and trends.
Activity during the fiscal year was concentrated on compiling and pub
lishing results of the 1954 Censuses of Business, Manufactures, Mineral In
dustries, and Agriculture. Publication progress for the various series of
preliminary and final reports issued thus far represents a substantial gain

ANNUAL REPO R T O F T H E SECR ETA RY O F COM M ERCE

over the publication rates for previous censuses in these fields. Improve
ment in the collection, processing, and publication phases of these censuses
has increased the timeliness and usefulness of the data for Government,
business, and the general public.
' Planning and preparation for future censuses were started. Forthcom
ing censuses will cover the following periods and fields: For 1957, govern
ments; for 1958, business, manufactures, mineral industries, and transporta
tion; and for 1960, population, housing, agriculture, irrigation, and
drainage.
In addition to this major census activity, work continued on current
► statistics programs for measuring and estimating status and change in
population, including employment and unemployment, domestic and
foreign trade, industry, and State and local governments. Numerous re
quests for special data and services from defense and other Government
agencies, business firms, and individuals were received and complied with
on a reimbursable basis.
i

Major Census Programs

First results of the 1954 economic censuses—business, manufactures, and
mineral industries—taken in 1955 became available in September 1955
with the release of preliminary summary data for certain mineral industries.
As rapidly as other tabulations were completed, summary data were pub
lished in a large number of advance releases covering all segments of the
1954 censuses. Detailed results are now being published in separate area,
industry, and subject series for each census. Publication progress for each
of these censuses is indicated below.
Plans have been developed for special tabulations of data from the 1954
economic censuses which will relate statistics for enterprises to the statistics
for the separate establishments of which they are composed. These tabula, tions will show size distributions of enterprises and the spread of their
activities among different industries.
Censuses of business and manufactures for Puerto Rico, covering the year
1954, were conducted in cooperation with the Government of the Common
wealth of Puerto Rico.
C e n s u s o f B u s in e s s .—Preliminary area reports, providing summary
Kdata for the retail, wholesale, and selected service trades, by kind-of-business
group, were published. These series comprised 153 releases for individual
States, the United States, and Alaska and Hawaii, presenting data for
counties and principal urban places. Approximately 20 preliminary trade
reports providing summary data for selected wholesale and service trades
also were issued. About one-third of the 150 final area bulletins presenting
, detailed data for individual States and local areas for the retail and whole
sale trade segments of the business census were published before the close
of the year. A new feature of the business census was the central business
district bulletin series, in which figures for the downtown business centers

A N NUAL R EPO R T OF T H E SECR ETA RY O F COM M ERCE

are presented for 90 or more metropolitan areas. They constitute a new
approach to measuring shifts and changes from 1948 to 1954 in retailing
and selected service trades between the downtown business centers of cities
and their suburban areas. Progress in compilation of the final subject and
trade bulletin series continued, these series being scheduled for publication s
following completion of the area bulletins.
C e n s u s o f M a n u f a c t u r e s .—Processing of the results of this census was
nearing completion at the end of the year. One-fourth of the 450 advance
reports for industries and 19 preliminary reports for individual States and
their standard metropolitan areas and counties were issued in the fiscal
year. These advance series are meeting some of the most urgent needs of <
users until they can be superseded by final and detailed individual industry,
State, and subject reports.
C e n s u s o f M in e r a l I n d u s t r ie s .—Nearly all of the series of 36 pre
liminary reports, providing advance summary data by industry and includ
ing geographic detail for most industries, were issued by the end of the
fiscal year. Preparation of separate industry and area bulletins containing <
detailed statistics was also carried on. The final data in these bulletins are
scheduled to be incorporated in two volumes—the first providing general
summary and industry statistics, and the second State and county statistics.
C e n s u s o f A g r ic u l t u r e .—In fiscal 1956, the first year following the
period of field work for the 1954 census of agriculture, new records were
set for the issuance of a very large number of reports. This was made
possible by speeding up both the processing of returns and the scheduling
of the enumeration immediately after the close of the crop year rather than
in the following January or April. Issuance of the more than 3,000 pre
liminary county and State summary releases, begun in February 1955, was
completed by December—a decrease of 6 months in the time needed to
issue similar reports for the 1950 census. Publication of the series of 49
preliminary reports for States giving the value of farm products sold by
source, for each county, was virtually complete by June 1956. Final data
for counties, State economic areas, and States are contained in volume I,
comprising 33 parts. With 10 parts of this volume already published, the
remainder was ready for printing prior to the close of this year. Volume II,
comprising the general report by subjects, and about 10 special reports will
complete the publication program for this census.
P l a n n in g fo r F u t u r e C e n s u s e s .—A census of governments is required
by law for 1957. The Bureau has held advisory committee meetings, and
made other necessary preparations.
Some plans were also made during the year for the 1958 economic
censuses, which will include the censuses of business, manufactures, mineral
industries, and transportation.
The Bureau also began to plan for the 1960 censuses of population, hous
ing, and agriculture, notably by consulting with user groups on their needs
for data. Among the subjects considered in early planning were the possi-

ANN U A L REPO R T OF T H E SECRETA RY OF COM M ERCE

bility of taking the agriculture census in the fall of 1959 instead of the spring
of 1960, the more extensive use of electronic equipment in tabulation, the
use of new enumeration and processing procedures eliminating use of
punchcards, and the greater use of sampling to provide some of the census
t data.

The Current Program

The current program of the Bureau was being geared to reflect, with con
tinued emphasis on timeliness and precision, changes in the economic and
social condition of the Nation. The current program comprised collection
> and compilation of data in the fields of population, employment and unem
ployment, housing, agriculture, business, industry, foreign trade, and govern
ments. Improvement in the quality and reliability of a major segment of
the program was assured with the expansion of the current population
survey and progress was made in speeding up reports through the further
development and utilization of electronic processing equipment.
» A g r ic u l tu r e .—Reports on cotton ginning were released at dates speci
fied by law. Cooperation with the Agricultural Marketing Service was
continued in issuing the consolidated cotton report. The two annual bul
letins on cotton production and distribution also were published.
B u s in e s s .—The annual sample survey of retail trade covering 1955 was
conducted, and the monthly retail and wholesale trade reports were con
tinued as before. Further work was undertaken in developing monthly
dollar-volume estimates of retail inventories and of sales and inventories
of merchant wholesalers. The advance monthly retail sales reports, pro
viding summary estimates 10 days after the close of the month, were con
tinued. The reports on stocks of selected canned foods were continued on
the basis of five reporting periods a year. The quarterly survey of recon
ditioned steel barrels and drums was continued, as was the annual survey
of green coffee roastings. The monthly petroleum products survey was dis1 continued with the December 1955 report.
F o reign T rade .—Starting in January 1956, the amount of statistical de
tail shown in reports on United States exports was substantially curtailed.
A continuing and steady increase in the volume of export declarations and
import entries to a level 20 percent above that on which the 1956 budget was
, based necessitated the retrenchment. This was accomplished by more ex
tensive sampling of export transactions and by reducing the commodity
classification detail in publications on exports. The import statistics pro
gram was not affected. Plans for restoration of the export data reporting
to its previous level were to be put into effect in July 1956, with the pro
vision of additional funds to handle the rising workload. In addition to
‘ the regular series of foreign trade reports, 222 special recurrent monthly
reports and 64 special reports for specified periods were prepared for in
dividual subscribers on a cost basis.

A N NUAL R EPO R T OF T H E SECR ETA RY O F COM M ERCE

G o v e r n m e n t s .—The regular series of current reports on State and local |
governments covered public finance (revenues, expenditures, debt, and fi- ,
nancial assets), and public employment (number of employees and amount '
of payroll). In addition, two special reports on public employee retirement |
funds and on veterans’ benefits since World War II were published.
<»
I n d u st r y .-—The regular annual survey of manufactures, which was not I
made for 1954 because of the 1954 census of manufactures, was planned to |
cover 1955 and was started early in 1956. A number of technical changes
and improvements were introduced to effect economies.
Reports in the Facts for Industry series, providing current estimates on
commodity production and shipments, were continued in this fiscal year on i
about the same basis as in the previous year. Many of these reports are I
financially supported by industry groups and by other Government agencies. j
P o pu l a t io n and H o u s in g .—Measures to improve the quality of infor- ,
mation developed in the current population survey were instituted with ad- '
ditional funds provided for this purpose. By a gradual process of selecting
new areas, training enumerators, and trial runs, an enlargement of the sam- 4
pie was made effective in the May 1956 enumeration. The number of !
areas in the sample was expanded from 230 to 330 and the number of |
households interviewed per month was increased from 21,000 to 35,000. i
Results of the survey continued to be published in the Monthly Report on I
the Labor Force, and other reports on labor force, population character
istics, and income. The regular program of current population estimates,
providing monthly estimates for the United States and annual figures by
States, was carried on. A new series of quarterly reports on housing va
cancies was begun. A new set of projections was issued for the population '
of the United States in the period 1960 to 1975.
Plans were developed during the year to meet the need for more recent
information on the number and characteristics of the Nation’s housing units
by means of the national housing inventory to be conducted by the Bureau
in the fall of 1956. This survey will provide data on number and char- *
acteristics of existing dwelling units and changes in the housing supply and
quality since 1950, for the Nation as a whole and for each of nine metro
politan areas selected on the basis of geographic location, size, and rates and
amount of growth since 1950.

Defense and Other Special Work

The Bureau of the Census continued to act as the principal collecting
and compiling agency for the Business and Defense Services Administration.
Other services were provided for the Office of Defense Mobilization, De
partment of Defense, Industry Evaluation Board, Federal Civil Defense Ad
ministration, and other agencies. Included in these services were nine re- ^
petitive special surveys, modifications of existing surveys, and special tabu
lations of data at hand in the Bureau.
1

ANN U A L REPO R T O F T H E SECR ETA RY OF COM M ERCE

Numerous special tabulations and compilations of other data from census
records were supplied at cost to other Government agencies, business firms,
trade associations, and individuals.
At the request and expense of the communities involved, the Bureau of
, the Census conducted special censuses of 227 cities and towns. The total
population enumerated in these special censuses was 5,819,510. Com
pared with the preceding year, this represented an increase of almost 60
percent in number of cities surveyed.
In the Colorado Motor Vehicle Use Survey, a cooperative effort of the
State of Colorado and the Bureau of Public Roads, the Bureau of the Census
, surveyed travel habits of car and truck owners, including mileage and fuel
used for pleasure and business driving. Starting in September 1955, the
survey was to extend over a period of 1 year.
The Bureau of the Census, assisting the California State Department of
Public Health in the Statewide California Health Survey for 1956, con
ducted a three-phase survey program. Data were collected on immunizal tion status and attitudes and on health and behavior problems of children
and related parental practices.

International Statistics Program

The Bureau of the Census increased its technical assistance to foreign
governments to improve their census and statistical services under programs
sponsored by the Department of State, the International Cooperation Ad
ministration, the United Nations, and the Population Council. A total of
172 foreign census and statistical personnel representing 42 countries visited
the Bureau for brief periods and observed operations and methods. Thirtynine foreign technicians, representing 15 countries, spent 3 or more months
receiving intensive instruction in United States census methods.
Under the technical assistance program, 15 Bureau of the Census experts
were assigned as consultants to foreign governments. They supplied census
and technical guidance to Cuba, Honduras, Iran, Jordan, Pakistan, Peru,
the Philippines, and Uruguay.
The Bureau of the Census also began preparations for collaborating with
other countries of the Western Hemisphere in planning for the 1960 Census
of the Americas.
The Foreign Manpower Research Office continued its studies and
analyses of international population and manpower. A report was pub
lished on the population of mainland China, by age and sex, based on the
1953 Chinese Communist Census.
t

Other Activities

S pec ia l P u b l ic a t io n s .—The second volume in the 1950 Census Mono
graph Series, prepared cooperatively with the Social Science Research
Council, was published. This was the analytical study, Income of the

ANN U A L REPO R T OF T H E SECR ETA RY O F COM M ERCE

American People. Other monographs were near completion at year end.
Planning and preparation were begun for revision of Historical Statistics
of the United States, which will cover the period 1789 to date. This work
is also a cooperative effort with the Social Science Research Council.
The second in the series of Bureau of the Census Working Papers included
a discussion of the role of the 1954 Census of Manufactures in overcoming
problems of industry data.
The 1955 edition of the Statistical Abstract of the United States was pub
lished in the shortest time ever. Progress in compiling the 1956 edition
indicates a further advance in date of publication.
Continuing efforts to improve the content and release schedule of the
quarterly Catalog of United States Census Publications have resulted in an
increase in its users as evidenced by a substantial rise in paid subscriptions.
M e c h a n ic a l and T e c h n ic a l O p e r a t io n .— Research and experimenta
tion were continued in the development and further refinement of the Film
Optical Sensing Device for Input to Computers (FOSDIC). Other re
search and development were directed toward improvement in various com
ponents of the Bureau’s tabulating system.
P er so n a l C e n s u s R ec o r d s .-—Applications for personal information to
establish proof of age or citizenship from Census records totaled 161,826,
an increase of 16 percent over the previous year. Total number of cases
processed was 163,567. Future demand for this service is expected to in
crease markedly as a result of changes in the Social Security Act which
lowered the age limits for retirement of women and of the totally disabled.

Inland Waterways Corporation
Since the sale of the physical facilities and operating rights of the Inland
Waterways Corporation to Federal Barge Lines, Inc., at the end of fiscal
1953, activity on the part of the Corporation has consisted largely of
winding up its affairs as a carrier, attending to the details incident to docu
mentation of property transfers, and protecting the interests of the Govern
ment through the surveillance of the purchaser’s operations.
The balance sheet of the Corporation, as of June 30, 1956, showed assets
of approximately $12.5 million and liabilities of approximately $620,000.
The net investment of the Government in the Corporation amounted to
$11.8 million, representing a gross investment of $27.3 million, less an
accumulated deficit of $15.5 million, this deficit being currently reduced by
approximately $0.3 million a year. Expenses during the year totaled
only $17,000, of which administrative expenses, under budgetary control
of the appropriation committee of Congress, were slightly over $11,000.

Appendix

Organization and Program Chronology
1903— -The Department of Commerce and Labor was created by the act of February
14 (32 Stat. 826; 5 U. S. C. 591). It consisted of the Office of the Secretary,
eight bureaus (Corporations, Labor, Census, Statistics, Fisheries, Navigation,
Immigration, and Standards), the Lighthouse Service, the Lighthouse Board,
the Coast and Geodetic Survey, and the Steamboat-Inspection Service. The
Bureaus of Manufactures was authorized but not organized.
1904— The Bureau of Manufactures was organized in February.
1906—The Bureau of Immigration was changed to the Bureau of Immigration and
Naturalization by the act of June 29 (34 Stat. 596).
1910—The Lighthouse Board was abolished and the Bureau of Lighthouses was estab
lished within the Lighthouse Service by the act of June 17.
1912— The Children’s Bureau was created by the act of April 9 (37 Stat. 79).
The Bureau of Foreign and Domestic Commerce was created and the Bureaus
of Manufactures and Statistics were consolidated with the Bureau of Foreign
Commerce of the State Department, by the act of August 23 (37 Stat. 407).
1913— The Department of Labor was created by the act of March 4 (37 Stat. 737;
5 U. S. C. 616). To this Department were transferred the Bureau of Labor
(thereafter called the Children’s Bureau) and the Bureau of Immigration and
Naturalization. The remaining functions of the Department of Commerce
and Labor were assigned by this act to the Department of Commerce.
1915—The Bureau of Corporations was merged March 16 with the Federal Trade
Commission, an independent agency.
1925— The Patent Office was transferred from the Department of Interior to the
Department of Commerce by Executive order of April 1 in accordance with
the act of February 14, 1903 (32 Stat. 830).
The Bureau of Mines was transferred from the Department of Interior to the
Department of Commerce (Executive Order 4239 of June 4).
1926— A Federal policy on commercial aeronautics was established by the act of May
20 (44 Stat. 568), placing the administration of commercial aeronautics under
the Department of Commerce. The Aeronautics Branch was created within
the Department.
1927— Creation of the Federal Radio Commission (which after 1 year’s operation
would have some of its powers transferred to the Department of Commerce)
was provided for by the act of February 23 (44 Stat. 1162).
The Radio Division of the Department of Commerce was created February 26
in the Office of the Secretary.
1931—The Federal Employment Stabilization Board was created February 10 to plan
and regulate construction of public works to assist in preventing unemployment
during business depressions (46 Stat. 1085).
69

A N NUAL REPO R T O F T H E SECRETA RY OF COM M ERCE

1932— Consolidation of the Bureau of Navigation with the Steamboat Inspection
Service was provided for by the act of June 30 (47 Stat. 415), effective August
1, under the name Bureau of Navigation and Steamboat Inspection.
j
The Radio Division was abolished and its functions and responsibilities were I
transferred to the Federal Radio Commission (Executive Order 5892 of July
20) .

1933— Functions of the United States Shipping Board were transferred to the Department of Commerce and the Board was abolished (Executive Order 6166
of June 10).
The Business Advisory and Planning Council was organized June 26 under
the authority of the organic act by which the Department of Commerce was
created (37 Stat. 737; 5 U. S. C. 616).
‘i
The United States Shipping Board Bureau was established August 9 in the
Department.
1934— The Federal Employment Stabilization Board was abolished and the Federal
Employment Stabilization Office established in the Department of Commerce
(Executive Order 6623 of March 23).
Transfer of the Bureau of Mines to the Department of Interior was author- <
ized effective April 23 (Executive Order 6611 of February 22).
The Aeronautics Branch was renamed the Bureau of Air Commerce July 1.
1935— The name of the Business Advisory and Planning Council was changed to the
Business Advisory Council April 11.
1936— The Bureau of Navigation and Steamboat Inspection was renamed the Bureau
of Marine Inspection and Navigation May 27.
Transfer of the United States Shipping Board Bureau to the United States ,
Maritime Commission was authorized by the act of June 29 (49 Stat. 1985),
effective October 26.
The Bureau of Air Commerce assumed entire responsibility for airway traffic
control July 6.
1938— The Bureau of Air Commerce was transferred August 22 to the Civil Aero
nautics Authority, created under the Civil Aeronautics Act of 1938 (52 Stat.
973; 49 U. S. C. 401).
1939— The Federal Employment Stabilization Office was abolished and its functions
transferred July 1 to the National Resources Planning Board by section 4 of
Reorganization Plan No. I (53 Stat. 1423).
The Bureau of Lighthouses (Lighthouse Service) was transferred to the
Department of the Treasury by section 2 of Reorganization Plan No. II (53
Stat. 1431). This Plan also transferred the Inland Waterways Corporation <
to the Department of Commerce (sec. 6), the Bureau of Fisheries to the
Department of the Interior (sec. 4E), and the Foreign Commerce Service to
the Department of State (sec. 1).
1940—The Weather Bureau was transferred June 30 from the Department of
Agriculture to the Department of Commerce and the Civil Aeronautics
Authority (including the Office of the Administrator of Civil Aeronautics and
the Air Safety Board) from its independent status to the Department of
Commerce. The Authority was comprised of the Administrator of Civil

ANN U A L REPO R T OF T H E SECRETA RY O F COM M ERCE

Aeronautics and the Civil Aeronautics Board.1 The Board absorbed the
functions of the former Air Safety Board. These actions were authorized by
sections 7 and 8 of Reorganization Plan IV (54 Stat. 1234).
That part of the Civil Aeronautics Authority under the direction and super
vision of the Administrator of Civil Aeronautics was designated as the Civil
Aeronautics Administration (Department of Commerce Order No. 52 of
August 29).
1942—The Bureau of Marine Inspection and Navigation was transferred to the
Department of the Treasury (Executive Order 9083 of March 1).
1945—The Office of Surplus Property was transferred from the Department of the
Treasury to the Department of Commerce (Executive Order 9541 of April
19).
The Office of Surplus Property was established (Department of Commerce
Order No. 359 of May 1).
The Office of Civilian Defense was transferred to the Department of Com
merce (Executive Order No. 9562 of June 4).
The Office of Civilian Defense Property was established (Department of Commerce Order No. 372 of June 21).
The Office of Declassification and Technical Services was established in the
Office of the Secretary (Department of Commerce Order No. 386 of Sep
tember 18).
Part of the Foreign Economic Administration was transferred September 27
to the Department of Commerce and liquidated.
The Office of International Trade Operations was established (Department
of Commerce Order No. 389 of October 1).
The Office of Surplus Property was transferred to the Reconstruction Finance
Corporation (Executive Order 9643 of November 5).
Reorganization of the Bureau of Foreign and Domestic Commerce and the
Office of International Trade Operations resulted in the establishment of
the Office of International Trade, Office of Small Business, Office of Domestic
Commerce, Office of Field Operations, and Office of Business Economics, all
within the Bureau of Foreign and Domestic Commerce (Department Order
10 of December 18).
1946—The Office of Production Research and Development was transferred from
the Civilian Production Administration to the Department of Commerce
(Executive Order 9673 of January 3). It become the Production Research
and Development Division of the Office of Declassification and Technical
Services (Department Order 22 of January 3).
Part of the Smaller War Plants Corporation was transferred to the Depart
ment of Commerce for liquidation (Executive Order 9665 of January 28).
1 The Administrator of Civil Aeronautics was placed under the direction and
supervision of the Secretary of Commerce. The Board was directed to exercise its
functions of rulemaking, adjudication, and investigation independently of the
Secretary. Its management functions, however, were to be performed through
facilities designated by the Secretary.

A N NUAL REPO R T O F T H E SECR ETA RY O F COM M ERCE

The Office of Civilian Defense Property was terminated (Department Order
33 of April 1).
The Office of Declassification and Technical Services was redesignated as |
the Office of Technical Services (Department Order 5, Amendment 1 of '
July 1).
1947— Parts of the former Office of Price Administration, Office of War Mobilization, and Civilian Production Administration were transferred to the De- (
partment of Commerce (Executive Order 9841 of April 23).
The Office of Materials Distribution was established within the Bureau of j
Foreign and Domestic Commerce to carry out the functions transferred by
Executive Order 9841 of April 23 (Department Order 69 of May 4).
The Division of Liquidation was established to liquidate the activities of the i
wartime agencies transferred to the Department (Department Order 75 of
June 1).
1948— The Office of Industry Cooperation was established to administer the volun
tary agreements program pursuant to Public Law 395, 80th Congress (Depart
ment Order 96 of January 22).
The Appeals Board for the Bureau of Foreign and Domestic Commerce was ^
established (Department Order 106 of January 28).
The Office of Materials Distribution was transferred to the Office of Domestic
Commerce (Department Order 18, Amendment 1 of May 7).
The Office of Small Business was transferred to the Office of Domestic Com
merce (Department Order 18, Amendment 2 of June 30).
1949— The Hoover Commission reported March 1 to the Congress its recommenda
tions concerning reorganization of the Department of Commerce.
The Public Roads Administration was transferred August 20 from the Federal |
Works Agency to the Department of Commerce by Reorganization Plan
No. 7 (5 U. S. C. 630b, Note). Its name was changed to the Bureau of
Public Roads.
The Office of Industry Cooperation and the voluntary agreements program
were terminated (Department Order 110 of September 30).
1950— The Government Patents Board was created and attached to the Department of Commerce for housekeeping purposes only (Executive Order 10096
of January 23).
The Federal Maritime Board 2 was established in the Department of Com
merce, the Maritime Administration created as an agency in the Department,
and the United States Maritime Commission abolished by Reorganization
Plan No. 21 (5 U. S. C. 170) (Department Order 117 of May 24).
^
The Office of Industry and Commerce was established ; the Office of Domestic
Commerce was abolished and its functions transferred to the new office; the 1
industry-commodity units of the Bureau of Foreign and Domestic Commerce
were consolidated in the Office of Industry and Commerce; the responsibil
ities of the Office of International Trade relating to commodities, export con
trol, transportation, and communications were transferred to the Office of
Industry and Commerce (Department Order 18, Amended, of October 5). y
2 The Board exercises its rulemaking, regulatory, investigative, and control funetions independently of the Secretary of Commerce.

A N NUAL REPO R T OF T H E SECRETA RY OF COM M ERCE

The National Production Authority was created pursuant to the act of Sep
tember 8 (64 Stat. 798; 50 U. S. App. Sup. 2061) and Executive Order 10161
of September 9 (Department Order 123 of September 11).
'
The Advisory Committee on Export Policy was established (Department
Order 125 of October 5).
The Office of Transportation and the Transportation Council were established
!
(Department Order 128 of November 20).
1951—The Industry Evaluation Board was established (Department Order 129 of
January 10).
The National Shipping Authority was created in the Maritime Administration
(Department Order 117, Amended, of March 13).
The loan guarantee program was established in the Department pursuant to
the Defense Production Act of 1950 and Executive Order 10161 of September
9, 1950 (Department Order 132 of June 29).
The Defense Air Transportation Administration was created pursuant to
Executive Order 10219 of February 28 (Department Order 137 of November
12).

C 1952—The Office of Distribution was created to foster better distribution so that
production and employment could be maintained on the decline of defense
production (Department Order 145 of October 1).
1953—The Office of Transportation was abolished (Department Order 128,
Amended, Amendment 1 of March 30) and its work thereafter focused directly
in the Office of the Under Secretary for Transportation.
The Inland Waterways Corporation was sold July 1 to the Federal Barge
Lines, Inc.
The Appeals Board was transferred from the Bureau of Foreign and Domestic
Commerce to the Office of the Assistant Secretary of Commerce for Admin
istration (Department Order 106, Amended, of August 18).
Four weaponry divisions and the Corona Laboratories of the National Bureau
of Standards were transferred to the Department of Defense pursuant to a
memorandum of understanding between the Secretary of Commerce and the
(
Secretary of Defense (18 F. R. 5713, September 27).
The Business and Defense Services Administration was established. Trans
ferred to BDSA were: Office of Field Service, Office of Technical Services,
Office of Distribution, Office of Industry and Commerce, and Industry Evalua
tion Board. The National Production Authority was abolished. These
actions were taken under Department Order 152 of October 1.
The Bureau of Foreign Commerce was established and transferred to it were
*
the functions of the Office of International Trade, which was abolished (De
partment Order 153 of October 12).
The Office of Business Economics was established as a primary organization
unit of the Department (Department Order 15, Amended, of December 1).
(N
.—Through Department Orders 152, 153, and 15, Amended, functions
of the Bureau of Foreign and Domestic Commerce were absorbed by the
,
Business and Defense Services Administration, Bureau of Foreign Commerce,
and the Office of Business Economics.)
1 1955—The Office of International Trade Fairs was established (Department Order
159 of January 27).
ote

A N NUAL REPO R T OF T H E SECR ETA RY OF COM M ERCE

1956—A National Defense Executive Reserve unit was established in the Department
pursuant to Executive Order 10660 of February 15 (Department Order 163
of May 16).
Appropriations for major expansion of the Federal-aid highway system, ad
ministered by the Bureau of Public Roads, were authorized June 29 by the
Federal-Aid Highway Act of 1956 (70 Stat. 374).

Secretaries of Commerce and Labor and of Commerce
Tenure
Begun
Ended
Commerce and Labor:
30,1904
June
Feb.
18,1903
George B. Cortelyou.
16,1906
1,1904
Dec.
Victor H. Metcalf. . .
July
5,1909
Mar.
17,
1906
Dec.
Oscar S. Straus.........
Mar.
4,1913
Mar.
6,1909
Charles Nagel...........

Commerce:

Mar. 5,1913
Dec. 16,1919
Mar. 5,1921
Aug. 22,1928
Mar. 5, 1929
Aug. 8, 1932
Mar. 4,1933
Dec. 24,1938
Sept. 19,1940
Mar. 2,1945
Oct. 7,1946
May 6,1948
Jan. 21,1953

William C. Redfield.
Joshua W. Alexander
Herbert Hoover........
William F. Whiting. .
Robert P. Lamont. ..
Roy D. Chapin.........
Daniel C. Roper. . . .
Harry L. Hopkins. . .
Jesse H. Jones...........
Henry A. Wallace. . .
W. Averill Harriman
Charles Sawyer.........
Sinclair Weeks...........

Oct. 31,1919
Mar. 4,1921
Aug. 21,1928
Mar. 4,1929
Aug. 7,1932
Mar. 3,1933
Dec. 23,1938
Sept. 18,1940
Mar. 1,1945
Sept. 20,1946
Apr. 22,1948
Jan. 20,1953

Full text of Annual Report of the Secretary of Commerce : 44th Annual Report of the Secretary of Commerce, 1956

FRASER