The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
367 A meeting of the Board of Governors of the Federal Reserve Sys— tek was held in Washington on Monday, March 15, 1943, at 12:00 noon. ?RESENT: Mr. Mr. Mr. Mr. Ransom, Vice Chairman Szymczak McKee Evans Mr. Morrill, Mr. Clayton, Mr. Leonard, Personnel Secretary Assistant to the Chairman Director of the Division of Administration Mr. Szymczak referred to the Executive Order issued by the on March 6, 1943, with respect to the deferment of Government loyees and asked Mr. Leonard to discuss the effect of the Order on the liclardt s employees. In accordance with this request, Mr. Leonard tkie a atatement substantially as follows: 114i Last fall the War Manpovier Commission established a procedure with respect to the deferment of Federal ci-r)Yees. On November 17, 1942, this procedure was ren— bered obsolete by the request of the President that there of, 11° requests for deferment of Federal employees because e a* thir employment. At that time the President appointed cl:maittee to review the whole question of policy and pro— e, with the understanding that if in the meantime there be e anY special cases requiring consideration they should b r l'eferred to him for decision. The committee appointed cic,the President consisted of Mr. Bellamy, Editor of the , eland Plain Dealer, Cleveland, Ohio; Mr. Tead, of Harper ariciir tiere.crothers, New York, New York; and Mr. Johnston, Presi— b. '6 of the United States Chamber of Commerce, Washington, allot • This committee submitted a report which was approved, dat at Executive Order was issued by the President under March 6, 1943, continuing the procedure established reg fall that no one in the Federal service should be de— tbeiecl unless he occupied a key position. You will recall 14.017" 1 submitted a list of key positions which was ap— bY the War Manpower Commission, and we have received !:uctions from the Commission that we should continue to 6he list pending the issuance of new Commission regula— tioxie. 308 3115/43 -2- Under the procedure established by the new Executive OrrY any- employee who occupies a key position and whose servvsees are regarded by the employing agency as essential can not released to enter the armed services voluntarily. The emth"Ing agency mist refuse to grant permission in such a case s the employee is to be assigned to active combat service ev,Ills abilities will be used equally as effectively or more 14„'ectively in the armed services. In other words, if the /7",..arci requested deferment in any case, it would be prohibited ranting its consent to the employee entering military dir.lIce on a voluntary basis unless one or both of these conhe""ns should exist. The Executive Order requires that the toad.of each agency shall designate a committee of from three airflve members which will be subject to the supervision and shalltion of the head of the agency, and that this committee ti„ make all requests for deferment and take the various "er actions outlined in the Order. The question is actively before the Board in connection with si4h the case of Paul Simpson, junior economist in the DiviResearch and Statistics, who recently received notice 1; he had been reclassified as I-A. The 10-day period al.0,71, for an appeal from this classification will expire to:Y or tomorrow. He will be 29 in June, is married, and has 04 11e child who was born more than nine months after the attack o1 aricIP!arl Harbor. He has applied for a commission in the Navy hi„ "as been advised that he is physically fit except that ti;eYes are not good enough for sea duty. We have heard conslishe,ntially that he has been approved for a commission as enthe Navy but he has not been sp advised. He is directly ,"arge of the compilation of the Board's index of industrie 4- Production 'which is used by various Government agencies, 64 ; 44a atatement of his duties which has been approved by tor8118. Goldenweiser and Thomas, Director and Assistant Direcis'l'espectively, of the Division of Research and Statistics, as follows: "Mr. Paul Simpson is the member of the Board's restaff primarily responsible for the analysis of Cvelopments in industrial production. In this capacity e as charge of the construction and compilation of the ,rral Reserve index of industrial production, the standauthoritative measure of production on which all de' l Itnients of the Government and the public in general res : This index and its various subdivisions provide an eY erientiza instrument for measuring the progress of the war and changes in the supply of civilian goods. One "cllvision of the index, developed by Mr. Simpson, is a 4 369 3115/43 -3- measure of the production of war goods. He is now directing the construction of a new index to measure the Production of various groups of consumer goods. These techniques of quantitative measurement of various phases 2f the war economy are of vital importance to the War vroduction Board, the Office of Price Administration, and !he Office of Economic Stabilization, as well as to the .rederal Reserve Board and to others. "Construction and compilation of such indexes of Pl'oduction are complicated processes which require constant adjustment and revision to take care of economic Changes. This is work of a professional and highly spe?ialized character, requiring a high degree of ability In handling mathematical techniques and in analysis of e? °n0mic data and also thorough familiarity with availab, sources of information. This particular combina, 1°n of qualifications is possessed by few people and -art be obtained only on the basis of a number of years of experience. "Mr. Simpson came to work for the Board in the ' : 43 4st of a fundamental revision in the methods of con:I bruction of the production index and has been engaged 411ring three years of drastic economic change in keep— the' index constantly representative of current con- T "The comprehensive revision of the index was comPie ;1,ted in 1940. Since that time the man who was in :'9',ge of the revision and a number of his principal sslstants in the -work have left the employ of the clarcl. Mr. Simpson is now the only man in the section ve, r .Participated in the revision and is thoroughly falar with the basic composition of the index as well ?with subsequent changes. At present the work of 01 , , 11111er revising the Index and compiling new measures .21 Production is at a critical stage and requires the ' ervices of Mr. Simpson for completion. it "For some time the Board has had many vacancies on T1,3 economic staff, which it has been endeavoring to fill. 0"?I'a has for some time been an urgent demand for econOf 8t8 on the part of Government agencies and the scarcity 41 such manpower is well-recognized. It would be partic' it rlY difficult to find some one with the special abilrequired to take over Mr. Simpsonts work, and almost -V°ssible to train some one for the task within a period °4 months." i 370 3115/43 0 Mr. Thomas understands that Mr. Simpson is wholly passive 21 the question whether he should be deferred and that he will accept the Board's decision and take his chances on obtaining ' commission at a later date. Mr. Szymczak stated that the first thing on which action should be take4 bY the Board was the appointment of the committee called for by the },reeicient t s Executive Order. Thereupon he moved that the Board ap— point a Committee on Deferment of Board Em— ployees consisting of Mr. Leonard as Chairman and Messrs. Clayton and Morrill as members. Er. Szymczak's motion was put by the chair and carried unanimously. 11/% Szymczak then said that another question to be decided by ' -4.1t1 was whether it would ask for any deferments and that it was aeetiked t hat such requests would be made on a selective basis, that the 48" Welacl be submitted by the head of the division concerned to the *ttee on Deferment and by the Committee to the Board, and that if a :eciliel3t for deferment were made the employee would be advised accord— arid a record made of any objection that he might have. He also / 1 41°that ' el. l deferment were granted the division head should be told tht.ith O the work bein:mployee should be trained as promptly as possible to do done by the employee for whom deferment had been requested, " 4 that there should be no expectation on the part of anyone that a re441ct the deferment would be requested. Mr. Szymczak then moved that the re— quest for the deferment of Mr. Simpson be approved, with the understanding that Mr. Goldenweiser would be instructed to train someone as promptly as possible to take Mr. Simpson's place. Mr. Szymczak's motion was put by the chair and carried unanimously. 371 3/1f43 —5— Mr. McKee suggested that in following the procedure outlined by 41's 4Alczak a written statement should be obtained from the employee or t "03111 deferment was requested showing that he had been acquainted M4t1-Lie steps being taken by the Board. At this point, Mr. Evans left the meeting to keep another apPo t There ensued a discussion of the question whether action should c4 by the Board to request the deferment of Mr. Hackley, Assistant Attolte 3r, even though the 10-day period provided for the appeal from ''381f1cation as I-A had expired. The circumstances with respect c'e41eY's draft status were set forth in a memorandum dated k4rch 2, 1943, from Mr. rreibelbis, General Attorney, which was conby the Board at the meeting on March 8, 1943. There was unanimous agreement that in the event the way was still open for such action the Board should request the deferment of Mr. Hackley for a six months' period. Thereupon the meeting adjourned. ,742„j_1"7„,ly) 6 Apotoye Secretary.
@FedFRASER