Mrs. KELLY. Would you say this program was held up by Defense taking this action in the past?

Mr. MCGUIRE. No; I don't think it has anything to do with holding up the program.

Mr. VORYS. It is priced up, not held up.

Mrs. KELLY. We are not getting our deliveries to the countries. Chairman RICHARDS. Defense can hold up this program just about as long as they please. They can do it about as long as they please. They can say we haven't the stuff, and hold it up about as long as they want. I can't figure it any other way.

Mr. VORYS. That is right.

Chairman RICHARDS. I am not talking about whether it is right or wrong. It may be right. I am talking about what is the cause of this long lead time.

Mrs. KELLY. I am talking about an answer to the delay in lead time when we bring this bill to the floor.

Mr. MCGUIRE. There is no question about it, I would say, Mr. Chairman, when it comes to the service turning equipment over to us, we have, in the past, at any rate, gone along, accepting the conditions of what they say their requirements are.

Fortunately, as I see it, we are coming pretty well to the end of the road on that type thing. We have F-100 planes in this program which will be coming off production lines. And, in addition, the types of equipment that we are proposing, such as these modern weapons, are the types of equipment which will simultaneously be delivered to the services.

I anticipate, in the case of some of these modern weapons, that we will be getting these modern weapons off a simultaneous production line. After all, we are a fairly big business here, and we have our commitments to meet in these areas, also, with due regard to the readiness of our own forces.

Chairman RICHARDS. I will tell you, Mr. McGuire, what bothers me. So far as lead time on a certain plane, or naval vessel, or something else, it doesn't seem to have gone down much in any category. As a practical proposition in Congress, we go down each year and try to sell the foreign aid program, as reported out of this committee. We are always asked, "Why do you need so much money so far ahead?" We say, "Lead time." It is pretty hard to sell a lead time which appears unreasonable. We are always going to have that trouble when you have all that money jammed up there which has not been spent.

They are already saying, "You have 4.8 billion. You have about 2 years' supply at a spending rate of $2.5 billion. And you have enough money in this bill, if you get it all, for another year. That is 3 years."

Each year we have been telling them, "We will see better where we stand in a year or two." But we go down to the floor every year, and you still have to have funds for all those years ahead. The lead time is not cut down.

My contention is, and I think Mrs. Kelly's, that is not entirely due to shortcomings on the part of Mr. Hollister, Mr. Stassen, or the State Department. You are at the mercy of Defense in large measure. Defense can make certain decisions and say, "We need this and we can't give you that. This order shouldn't be placed now. That

order shouldn't be placed. This order should supersede that order." "I think your lead time, if you were disentangled from the requirements of Defense, could be cut down.

Mr. MCGUIRE. I think that is unquestionably true. It has been true in the past. I have been a merchant all my life, and I had some experience with the services during the war. I think a good deal of that problem, or a part of that problem, is over the hill.

I have illustrated two items that we will get simultaneously from the production line, the F-100 and some of the more modern weapons, As we go further into this thing, and these areas that we are supplying get modernized, it is understandable that both we and the services would be seeking the same things. As to what success we will have, it is going to be a matter of salesmanship, I think, within our organization in getting along, in getting these things done.

So far I have had a great deal of assistance from the respective services in recognizing this problem.

Chairman RICHARDS. Well, we have to face this on the floor every year. Off the record.

(Discussion off the record.)

Mr. VORYS. On this matter, of course, Defense has the veto as to the issue of whether something should go to foreigners or to our own forces. And, of course, Defense during the Korean war milked this program because they didn't have enough stuff coming off the line to use in Korea. Of course we want our own arms requirements to be paramount. What we have been trying to figure, after the bil lions that we have turned over to Defense, is why they can't arrange to have both of the program proceeds for ourselves and our allies. Why do we still have to talk about leadtime in periods of time longer than it takes to make the stuff?

Chairman RICHARDS. That is right. I think we agree on this. If our country needs this stuff first, they should get it first. There is no question about that. But, by this time, and after the demand in Korea has been reduced, both programs should be flowing simultaneously. It makes it difficult for us to justify.

Mr. MCGUIRE. We are well aware of that.

We have 2 or 3 other charts here, sir, that will help answer some of the questions you may still have. Our purpose is to give you all the background information we can.

Mr. VORYS. On this lead-time business, could I ask just one technical question? As I understand it, for instance, the North American makes F-100s, and so forth, out there in my hometown.

Chairman RICHARDS. He is a former naval aviator. He is a specialist on this subject.

Mr. VORYS. I am an expert on this, and these infantry boys on the committee are kind of jealous. As I understand it, there is a period of over a year, an enormously long period, that is required to put a jet fighter together because they are working in confined spaces and there is only one fellow who can get in there at a time to put in these miles of wiring, and so forth. You can't compare it to getting an automobile-production line ready, where once you have the dies and jigs made you just stamp them out like doughnuts. There is a substantial lead time involved in every one of them, no matter how much you have it perfected.

Is there anything to that point?