nanufacture of the artillery for which these plants are erected. Some of them have been unwilling to use their organizations in the rection of these plants unless they had an assurance of occupation or the plants, which, in the absence of appropriations, could be given hem to no greater extent than is involved in the information that stimates which would afford occupation for the plants had been subnitted to Congress. Therefore the commencement of the erection of a number of plants that we would like to see in process has been out off.

Mr. GILLETT. And will be delayed until this bill is passed?

Gen. CROZIER. Apparently until we get some authoritative assurince that there will be occupation for them. Under these circumstances, I will be glad if the committee will consider in the beginning the desirability of taking some action which will permit these plants to be started. I do not know exactly the form that that action could take. I could make one or two suggestions. One would be that a resolution might be passed which would authorize a certain percentage of appropriations which had already been made for purposes necessary in the prosecution of the war, but different from the purposes for which they had been directly made, to be used. That would scarcely meet the situation that I am talking about, because the difficulty is there has not been sufficient funds appropriated for this program; the program has never been submitted to you before.

The CHAIRMAN. How much is required for that purpose?

Gen. CROZIER. The total cost of the plants that will have to be established for the manufacture of artillery is about $35,000,000; that is, the plants for the construction of artillery pretty nearly, not entirely, form the bulk of those which will have to be provided for in this way.

The passage of a joint resolution of the kind I have just mentioned would, however, free us for making certain kinds of expenditures for which there was no appropriation in the act of June 15, because there was no estimate before you. As an illustration of that, I can refer to the estimate of $3,000,000 for a new proving ground which is now before you and is very much needed here in the East. You appropriated for a proving ground in the West, and we are in the process of getting it, but, as I will explain later on, we are greatly in need of a proving ground in the East, and I have submitted an estimate of $3,000,000-a resolution which will permit us to make that expenditure ought to be made just as soon as possible. In order to make more money available some act must be passed which is in the nature of an appropriation, the very thing we are talking about now. For that purpose the only suggestion I can make would beI do not know how this would accord with the rules of Congress-a resolution authorizing the President to incur obligations for the armament of the forces necessary for prosecuting the war against Germany.

The CHAIRMAN. Without any limitation?

Gen. CROZIER. I could easily give you a limitation.

The CHAIRMAN. Of course, it would take just as long to pass that joint resolution as to pass this whole appropriation bill.

Gen. CROZIER. I thought the first suggestion might be put through quickly.

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The CHAIRMAN. There is another alternative. Congress, in order to provide for just such situations as this, put at the disposal of the President $100,000,000. Have you applied for an apportionment from that fund?

Gen. CROZIER. I have not made a formal application for this particular purpose, Mr. Chairman. I made one application for another purpose and did not get it.

The CHAIRMAN. You did not take that as conclusive upon all your applications?

Gen. CROZIER. I thought it was illustrative. I can make another application, of course.

The CHAIRMAN. Personally, I do not see how it would be possible to handle this in piecemeal with different resolutions, because what you say is imperatively essential shall be done for you is stated by officers from a number of other branches of the War Department, and by the time we would include all those things which have to be done immediately we could get the bill through.

Gen. CROZIER. As far as that is concerned, I can only suggest that the committee would have to use its judgment. I present the program of artillery construction. You all know that is a matter requiring a long time. Of course, you can look ahead and form an estimate of the number of troops that artillery ought to be provided for and the length of time which will be required to provide any artillery if you should start now. When you do that, it seems to me there is only one conclusion possible either we will not raise those troops at this time or they will not have artillery if they are raised, or else we must in some way or other start to get the artillery.

The CHAIRMAN. I do not think that any time will be consumed in the proper consideration of the bill if it is going to have any effect whatever in delaying the acquisition of the Artillery. Certainly Congress has not delayed it in any way; it has worked just as rapidly as it could. These estimates were delayed in transmission to Congress a much longer time than they have been before us. The delay was in the executive department of the Government and not in the legislative.

Gen. CROZIER. The newspapers contained a statement that Congress was not going to take action on the present estimates, and I was disturbed by that report, which may not be true.

The CHAIRMAN. Before you take up the items specifically, General, you have been speaking about the policy of enlarging plants in order to acquire the manufacturing capacity needed, and this is done by arrangement with existing plants. What are the arrangements made where the Government invests its money in a plant upon land owned by a going concern?

Gen. CROZIER. Usually the arrangement is that the company will be authorized to erect a plant consisting of buildings and equipment up to a certain specified limit of cost, and that the buildings, which are required to be temporary in their character, and the equipment will remain the property of the Government, but can be used by the contractor in prosecuting the Government's work, and upon the conclusion of the contract shall be removed by the Government within a stipulated time or otherwise disposed of. Then the contract provides a certain amount of material shall be constructed

with this plant upon certain terms which vary somewhat in the different contracts. The ordinary form is that the consideration paid the contractor shall be the cost of production plus a profit, and that profit may either be in the form of a percentage or it may be a fixed sum, and in several cases we have made it a fixed sum per unit of the articles produced; and in some cases we have introduced a stipulation that the profit shall vary and shall increase if the cost is diminished and shall decrease if the cost is increased over a certain estimated figure.

Mr. SISSON. When you give a fixed sum for an article you have nothing to do then with the cost of production. You put the plant in and give Government aid, and they then get so much for each unit produced irrespective of the cost of the unit.

Gen. CROZIER. The amount they get for each unit produced is usually based on the estimated cost of that unit.

Mr. SISSON. That is true, but after you shall have made the contract the unit cost would be irrespective of the cost of manufacture. They take the chances in that sort of contract of producing the article at a profit.

Gen. CROZIER. No; they do not take many chances. The Government pays the cost and in addition pays them a fixed sum for profit. I say a fixed sum, but usually the sum is not entirely fixed because we put in an incentive for the manufacturer to try to keep the cost down by saying that if the cost shall be less than a certain estimated amount, the profit shall be correspondingly increased, and that is arranged so that the benefit which the Government gets from the reduced cost greatly exceeds the benefit which the manufacturer gets by reason of the increased profit; and then on the other side, if the cost exceeds a certain estimated amount, the profit of the manufacturer is reduced, but there again it is never enough to make good to the Government the difference in cost. Then we have other forms of contract, which I have spoken of before to the committee in connection with different bills, in which the profit takes the form of a percentage on the cost. It is difficult in that form of contract to get a direct incentive to production, and in the cases where we have used that form of contract there was usually some other incentive which we relied upon to cheapen production.

Mr. SISSON. As a business proposition I like your last arrangement much better.

Gen. CROZIER. So do I, Mr. Sisson. There is an incentive in the last case to the manufacturer to make this fixed profit just as soon as he can. The more times he makes it in the course of a year, of course, the greater his yearly income, and he has that incentive to accelerate production, and if you accelerate production there are certain charges that necessarily come down. Of course, in accelerating production there may be over equipment or something of that sort, or over compensation to labor. Now, to meet that we put in the incentive of increasing his profit on a sliding scale, depending upon the cheapening of the cost.

Mr. Sisson. There is an incentive for efficiency in the cost of production where the profit increases with the decreased cost of the product.

Gen. CROZIER. Yes, sir.

RIFLES, SUPPLY OF.

(See p. 859.)

The CHAIRMAN. General, we provided heretofore the sums it was estimated would be required for ordnance purposes for an army of 1,000,000 men for one year.

Gen. CROZIER. Yes, sir.

Mr. SHERLEY. General, all of the Infantry Regulars who are going abroad are being equipped with modern rifles?

Gen. CROZIER, Yes, sir.

Mr. SHERLEY. The National Guard, presumably, will be the early troops, after the Regulars, to follow them to the front. Are they going to be equipped with modern rifles?

Gen. CROZIER. Yes, sir.

Mr. SHERLEY. There are going to be called some time this fall something like six hundred odd thousand men that compose the National Army as a result of the draft law. They will go into training camps. To what extent will you be able to equip them with rifles?

Gen. CROZIER. To a considerable extent, but not to the full extent. Of those 687,000 all but about 500,000 will probably go into the Regular Army or the National Guard, to fill them up, leaving only about 500,000 of the National Army. The 187,000 that will go into the Regular Army and the National Guard I have included in my answer to you about the Regular Army and the National Guard. Mr. SHERLEY. But they can not go until they get the training? Gen. CROZIER. That is true.

Mr. SHERLEY. Any more than the other men can go into the National Army?

Gen. CROZIER. Yes, sir.

Mr. SHERLEY. Will you be able to supply every soldier whose instruction will require the use of a rifle in training with either the Springfield, the modified Enfield, or a Krag?

Gen. CROZIER. Yes, sir.

Mr. SHERLEY. There will be no need, then, for any soldier being trained in these camps in the use of a rifle to be without one of these types of rifle for his training?

Gen. CROZIER. No, sir; that is correct.

Mr. SHERLEY. Those who are trained with the Krag-Jorgensen. to what extent will it be necessary to additionally train them for the use of the modified Enfield that is to supplant the Krag?

Gen. CROZIER. To a very slight extent.

Mr. SHERLEY. In other words, the training in making them infantrymen, except to a very limited degree, would not be dependent upon them having the particular type of rifle?

Gen. CROZIER. That is true, particularly when all three might well be considered modern rifles. The Krag-Jorgensen, although we call it an obsolete rifle for us now, is still a small bore, smokeless powder, magazine, bolt gun. That describes the principal characteristics of the most modern rifle.

Mr. SHERLEY. You supply, in addition to the rifle, a good deal of other equipment which might be designated, though it may not be the technical name, as the personal equipment of the soldier?

Gen. CROZIER. Yes, sir.

Mr. SHERLEY. I am not speaking now of anything with reference to field artillery as such, but I am speaking more particularly of what would relate to the Infantry soldier and to the noncommissioned and commissioned officers of the Army. What position will you be in touching the equipment of them? In the first place, am I right in the assumption that all the regular troops that are going abroad, in the sense of personal equipment that I have spoken of, will be fully supplied?

Gen. CROZIER. Yes, sir; fully supplied.

Mr. SHERLEY. How about the National Guard?

Gen. CROZIER. I think that the National Guard will be fully equipped also by the time they go abroad.

Mr. SHERLEY. How about being equipped fully when they go into the training camps so as to have all the necessary equipment incident to their training?

Gen. CROZIER. I think they will have all that is necessary for their training, although there will be some shortages. The personal equipment of the character you speak of constitutes that which goes with the man's fighting ability. For instance, his cartridge belt is an article of personal equipment. He has that to fight with. It also comprises that which is necessary for the man to maintain himself and keep himself alive. He has to have certain utensils to cook his food or eat it, a canteen to carry water in, a pack carrier-it used to be called a knapsack and then afterwards a haversack, but they do not use either now. The pack carrier takes the place of both and is needed for the same purpose. He has to have that to carry some of his necessary personal belongings in. Some of these things are necessary from the time the man comes into the service. For instance, what he eats with he has to have as soon as he comes into the service.

Some of the things may not be necessary until he has to do some marching. With reference to what he has to have as soon as he comes into the service, namely, his meat-ration can, his knife, fork, and spoon, his tin cup-although it is not made of tin any more-and, perhaps, also his canteen, he will have those right from the beginning; that is, he will have them or he will have a commercial substitute which will do until he can get the regular things. Then, before he has to do anything which involves marching, he will have the pack carrier. There is no perfect assurance that every man will have the pack-carrier articles as soon as he comes in the service, because we have encountered a shortage of material and we have encountered a shortage of looms with which to weave the material.

Mr. SHERLEY. If I understand you, General, all the men that go into the Regulars and go abroad, and the Regulars who are here, will be fully equipped with all the personal equipment of every kind and description?

Gen. CROZIER. Yes, sir.

Mr. SHERLEY. As to the National Guard-you have already explained about the rifles-they will be equipped either with the standard article or with a commercial one that will serve the same purpose, though presumably not quite as good, from the time they come into the service, into these camps, and during their training, and that, with the possible exception of the packs, by the time they may be ready to go abroad they will all be equipped fully with all the personal equipment?