Mr. BUCHANAN. You see the point, do you not, Mr. Jump?

Mr. JUMP. I see the point. I remember that when that money was appropriated in the Interior Department act, the language was deficient in that it failed to carry that specific administrative expense authority.

Mr. BUCHANAN. I understand, but suppose that is so. Suppose there is no money to administer that fund. Does that authorize the Comptroller General to just look around through the agricultural bill and pick out an appropriation made for a specific purpose and rule that that money may be diverted from the purpose for which it was appropriated, to be applied to another purpose?

Mr. JUMP. Under ordinary conditions, it would not. But this was a very emergent situation. Congress enacted in an emergent manner in making this money available. I have no doubt that in the comptroller's decision on that point, he gives his legal theory to justify that ruling.

Mr. BUCHANAN. Of course, you know that an emergency is an occasion for legislative action, and not for the misconstruction of legislative acts.

Mr. JUMP. I have to admit that that is correct, yes.

Mr. BUCHANAN. The Comptroller General, the President, and every other officer of the Government would protest against yielding authority created specifically by law for a specific purpose.

Mr. JUMP. I think there must have been some language in the $45,000,000 enactment that covered the whole field of emergency loans. Am I correct in that?

Mr. HOFFMAN. There is no language at all. It was silent, because it was an amendment to the $45,000,000 act that provided for all expenses in connection with the administering of that act. Therefore the comptroller held that the $45,000,000 item was exclusive. As a matter of fact, we had incurred expenses and had spent some $40,000 or $50,000 from the $20,000,000 appropriation and we were required to transfer that money from the $45,000,000 appropriation, to reimburse the $20,000,000 appropriation.

Mr. BUCHANAN. I am not questioning his authority that the $20,000,000 was to take care of the stock in these agricultural credit corporations; that may be all right. I am just questioning his authority to come over here and take some of this $500,000 appropriation, made for a specific purpose by Congress, and apply it to a different

purpose.

Mr. JUMP. He must have found something in those acts to justify his ruling. Congress had rushed this legislation through. There was a great demand for it. There was a great hue and cry everywhere for the Government to do something and as you will remember, it was put through with all kinds of special dispensation. Now, I imagine when he found that the wording was deficient in that it did. not provide any means with which in detail to accomplish the major purpose of the act that had just been passed by Congress with so much dispatch, the comptroller took a liberal view.

Mr. BUCHANAN. It seems to me that his liberality was in taking the money out of that appropriation.

Mr. JUMP. I would say that, too. There must have been some language in the other appropriation that led him to take that course, because his liberal view would have been to take the position that

while Congress did not provide specifically for the payment of the necessary and reasonable expenses to accomplish this out of this $20,000,000-he must have had language in the other act on which to base his ruling.

Mr. HOFFMAN. The language in the $45,000,000 act says, for all expenses in connection therewith, the $20,000,000 being added as a second paragraph to the original $45,000,000 appropriation.

Mr. BUCHANAN. I expect that would authorize that holding.

Mr. JUMP. I think he must have relied on that; otherwise he would have said to go ahead and use part of that $20,000,000.

Mr. BUCHANAN. However, this was made for the specific purpose of collecting loans.

Mr. JUMP. No, sir; not this money.

Mr. BUCHANAN. This year's money?

Mr. HOFFMAN. This year's money, but it names all of our acts, though.

Mr. BUCHANAN. But it is for collection.

Mr. HOFFMAN. Yes, sir.

Mr. BUCHANAN. To enable the Secretary of Agriculture to collect moneys due the United States on account of loans made under the provisions of those acts.

Mr. HOFFMAN. Yes, sir.

Mr. BUCHANAN. It is dedicated for the collection of the loans.
Mr. HOFFMAN. Yes, sir.

Mr. SANDLIN. Was not part of the $20,000,000 loaned?

Mr. HOFFMAN. Yes, sir.

Mr. BUCHANAN. But what I am talking about is that part of it was expended for taking stock in the agricultural corporations. Mr. SANDLIN. I understand that.

Mr. BUCHANAN. And charging the expenses of the administration of that branch to seed collections loan, or taking it out of seed collections loan.

Mr. SANDLIN. Does the wording of the act say including $20,000,000?

Mr. HOFFMAN. Yes, sir.

Mr. SANDLIN. It looks like it is covered, then?

Mr. JUMP. No. Mr. Buchanan makes the point this money was only for collection.

Mr. BUCHANAN. Yes; only for collection.

Mr. JUMP. Now, Mr. Hoffman, this fiscal year, is not the amount that is being used a very small amount?

Mr. HOFFMAN. Oh, yes; for collections.

Mr. JUMP. No; I mean for making agricultural credit loans.
Mr. HOFFMAN. Very small.

Mr. BUCHANAN. That is not loans; that is just for taking stock. Mr. JUMP. For doing anything in connection with agricultural credit. It is almost inconsequential.

Mr. HOFFMAN. We are engaged in the collection of loans made to buy this stock. The loans to buy this stock were made direct to individuals and the people who are employed in this work now are engaged in the collection of loans made to individuals to purchase capital stock in these corporations.

Mr. JUMP. Only that?

Mr. HOFFMAN. Only that.

Mr. JUMP. Then that changes the whole thing around.
Mr. HOFFMAN. I thought that was understand.

Mr. JUMP. I could not understand that myself, because there had only been $60,000 loaned this fiscal year from department money for agricultural credits; so there could not be much money spent to make loans.

Mr. BUCHANAN. So this Comptroller General's opinion holds you can use this money to collect loans made direct to those people to enable them to buy stock in these corporations?

Mr. JUMP. Yes. That is based on common sense, because the Government ought to be able to get the money back in the best way it can.

Mr. BUCHANAN. That is all right; my criticism was made on a misunderstanding of the facts.

AMOUNT EXPENDED FOR PERSONAL SERVICES IN THE DISTRICT OF

COLUMBIA

Mr. BUCHANAN. I see you reduce the amount expended in the District of Columbia from $80,000 to $60,000; is that correct? Mr. HOFFMAN. Yes, sir.

Mr. BUCHANAN. What is the reason for that?

Mr. HOFFMAN. The number of employees engaged in the collection of these loans varies according to the chances for the repayments and each year, as the loans become older, it takes fewer employees to take care of the work. Accordingly, we reduce the number of our employees the moment we are able to do so.

COOPERATION WITH CROP PRODUCTION LOAN OFFICE

Mr. BUCHANAN. I believe you said the employees of your bureau or division are being used by the Crop Production Loan people to collect their loans?

Mr. HOFFMAN. To this extent: The crop production loan office have in the field approximately 607 field men paid from their appropriation. We have in the field about 60 field men whose salaries or expenses are paid from our appropriations. The work has been consolidated for the purpose of economy, so that we would not have two sets of men operating in the same county or possibly calling on the same farmer. Mr. BUCHANAN. And each man is collecting what he can on account of any loan?

Mr. HOFFMAN. That is right, and thereby reducing expenses.

CROP PRODUCTION LOANS

Mr. BUCHANAN. Who is administering those crop production loans? Mr. JUMP. It is administered under the direct supervision of the Secretary. It is not a part of the department in the sense that everything else is, but it is administered directly by the Secretary, through an office set up known as the crop production loan office. Mr. HOFFMAN. That is right.

Mr. JUMP. I guess Mr. Hoffman, who is attached to it in an advisory capacity, can tell you more about it than I can. We do not have to do with it in the department.

Mr. BUCHANAN. Is any report of the stewardship rendered to this committee; if not, to what committee?

Mr. HOFFMAN. Under the Reconstruction Finance Corporation act, I think the secretary renders his report to the Reconstruction Finance Corporation, who will no doubt include it in their report to Congress. Mr. SANDLIN. That would go before the committee handling the appropriation bill for independent offices.

Mr. JUMP. It is a Government corporation.

Mr. HOFFMAN. A Government corporation.

Mr. SANDLIN. Has Mr. Clark been transferred to the Reconstruction Finance Corporation?

Mr. HOFFMAN. Yes, sir.

Mr. BUCHANAN. What does the secretary do with the money he collects?

Mr. JUMP. That money goes back into the corporation funds, does it not?

Mr. HOFFMAN. Heretofore it has been put in a special account. The unexpended balance that the crop-production loan office had this spring from the amount allocated to the secretary was turned back, in accordance with the provisions in the emergency relief and construction act of 1932, which provided for the creation of 12 regional agricultural corporations with a paid-up capital of not less than $3,000,000, to be subscribed by the Reconstruction Finance Corporation and paid for out of the unexpended balances allocated to the secretary. As collections have been made, the Reconstruction Finance Corporation have requested, from time to time, to return this money to be used for the above-mentioned purpose.

Mr. BUCHANAN. That is sort of a revolving fund. You stated that your field men in the collection service had been consolidated with the field men on the production loans authorized in the Reconstruction Finance Corporation act: Do you know how much money was allotted or turned over to the Secretary of Agriculture to make those production loans?

Mr. HOFFMAN. I believe there was first $50,000,000 turned over to him.

Mr. BUCHANAN. Well there was a great deal more than that later on, was there not?

Mr. HOFFMAN. I believe there were other allotments.

AMOUNT OF CROP PRODUCTION LOANS MADE AND COLLECTED

Mr. BUCHANAN. Do you know how much has been loaned?
Mr. HOFFMAN. $64,000,000 was loaned.

Mr. BUCHANAN. Do you know how much of that has been collected?
Mr. HOFFMAN. Up to November 30, $14,922,751, in cash.
Mr. BUCHANAN. Do you know how much is collateralized?

Mr. HOFFMAN. Not exactly; no, sir. I do not have the full detailed figures from each office.

REQUIREMENT FOR REPORT ON CROP PRODUCTION LOAN OPERATIONS

Mr. BUCHANAN. To whom does the Secretary of Agriculture make report of his stewardship in administering those loans and collecting them?

Mr. HOFFMAN. I think he makes his report direct to the Reconstruction Finance Corporation.

Mr. BUCHANAN. And to whom does the Reconstruction Finance Corporation make report, if you know?

Mr. HOFFMAN. I think under the terms of the Reconstruction Finance Corporation act they are required, periodically, to make a report to Congress of their activities.

Mr. JUMP. Undoubtedly they have to make report to Congress. Mr. HOFFMAN. Yes.

Mr. BUCHANAN. I know they make report to Congress on the loan they make and file it with the Clerk of the House; but I do not know that there is any provision requiring them to report to Congress on the loans made by the Secretary of Agriculture.

Mr. JUMP. Undoubtedly they report to Congress everything they do. Certainly the original act must make provision for that.

Mr. BUCHANAN. What I want to get at is what committee of Congress, or subcommittee, either of the Appropriations Committee or any other committee, will review the expenditure or has the right to review the expenditure, collection, and the disposition of the funds. Do you know of any?

Mr. JUMP. Of any committee in Congress?

Mr. BUCHANAN. Yes; or any subcommittee.

Mr. JUMP. I would have to know what the relationship to Congress of the Reconstruction Finance Corporation is. When the Clerk finds that section, I think it will throw some light on that subject. I am sure the Secretary, though, would be glad to give any information this committee wants.

Mr. BUCHANAN. I feel sure of that; but what I am driving at is whether or not this is the proper committee to hear an account of his stewardship of this fund, of the collections, the amount loaned, the amount of principal and interest collected, and the disposition of that principal and interest-whether it goes back into the Treasury, or whether it goes into a revolving fund of some sort, or what becomes of it. I want to keep track of it.

Mr. SANDLIN. They have to account. Do the Reconstruction Corporation officials and the Secretary of Agriculture handle this together?

Mr. HOFFMAN. No, sir. Section 2 allocated the amount directly to the Secretary of Agriculture.

Mr. JUMP. He is the agent, then, of the corporation?

Mr. HOFFMAN. Of the corporation.

Mr. SANDLIN. Then in his disposition of these funds, the handling of them, does he have to report to the Reconstruction Finance Corporation?

Mr. JUMP. Yes; he does. He gets this money from the Treasury of the United States on their order, in the form of one check, as I understand it, and then he acts as their agent and must report to them, of course.

Mr. BUCHANAN. Then, as I understand, the Secretary of Agriculture in making and collecting those crop production loans acts as an agent of the Reconstruction Finance Corporation?