REPEALING THE NATURAL FIBERS ACT

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP59-00224A000100240003-6
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 6
• Document Creation Date: December 9, 2016
• Document Release Date: September 7, 2000
• Sequence Number: 3
• Publication Date: February 16, 1955
• Content Type: REPORT

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84TH CONGRESS HOUSE OF REPRESENTATIVES REPORT
1st Session No. 53
REPEALING THE NATURAL FIBERS ACT
FEBRUARY 16, 1955.-Committed to the Committee of the Whole Housc+ on the
State of the Union and ordered to be printed
Mr. DURHAM, from the Committee on Armed Services, submitted the
following
REPORT
The Committee on Armed Services, to whom was referred the bill
(H. R. 2123) to repeal Public Law 820, 80th Congress (62 Stat. 1098),
entitled "An Act to provide a revolving fund for the purchase of
agricultural commodities and raw materials to be processed in occupied
areas and sold," having considered the same, report favorably thereon
without amendment and recommend that, the bill do pass.
The purpose of H. R. 2123 is to repeal Public Law 820, 80th. (Ion-
gross (62 Stat. 1098), commonly known as the Natural Fibers Act.
Public Law 820, 80th Congress, provided for a revolving fund for
the purpose of (a) purchasing- natural fibers (including cotton waste)
produced in the ITnited States, and such other materials, including
starch, dyestuff, roller leather, and card clothing as may be used in
processing and finishing such fibers; (b) transporting such fibers and
other materials to occupied areas, making them available for process-
ing, and having such fibers processed in such area; (c) insuring such
fibers and materials and the products obtained from such processing;
and (d) selling products obtained from such processing. rite basic
objective of this law was to assist in the industrial rehabilitation
and economic recovery of occupied areas. It was felt that until
these countries could be restored to a bans of self-support, the Ameri-
can taxpayers would have to continue to foot it large bill for feeding
and clothing the people of these areas. Proceeds- from the sale of
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2 REPEALI\(; THE NATURAL FIBERS ACT
products of commodities purchased with money from the fund were
utilized to repay, with interest, outlays from the fund.
Although other areas were in a position to benefit from the pro-
visions of this act, Jal:an was the only area to take advantage of this
opportunity. The Secretary of the Army was authorized to issue
notes for purchase by the Secretary of the Treasury in an aggregate
'mount not to exceed $150 million to cover payments of costs speci
r'ied in the act. Under this authority, a note for $100 million was
issued to finance shipments of raw cotton to Japan and the total
0xpenditures made for this purpose during 1948-49 amounted to
$57,554,227. Complete repayment of the borrowings was effected on
June 13, 1950. Since chat date no further purchases have been made
with moneys from tha , fund.
The $100 million note was kept open in the event of any critical
need for the further financing for United States raw cotton shiipmenta
to Japan during the balance of the occupation. Such a need did not
arise in light of favorable trade developments and the acquisition of
substantial foreign exchange balances by Japan.
On May 22, 1952, the Department of the Treasury notified the
])epartment of the Aram that the $100 million note would expire as of
June 1, 1952, and that in view of the termination of the occupation,
arrangements should be made for the cancellation of this note. Ac-
cordingly, the Secretary of the Army requested the Secretary of the
Treasury, on June 2, 1952, to transfer the $100 million note in full
repayment of the general fund of the Treasury.
Repeal of Public Law 820 is desired because with ratification and
confirmation of the treaty of peace with Japan, and with no antici-
pated requirement for outlays of money from this fund by the remain-
Dig occupied areas, no further need seems to exist for the fund; and
repeal, if enacted, would remove from the statute books a law no
longer required. Further, although the authority granted in Public
Law 820 is Iiot utilized, the retention of the act on the statute books
imposes a requirement on the Secretary of the Army annually to make
a complete report to Congress with respect to the status of the fund.
Preparation of this report by the Department of the Army and review
by the Bureau of the Budget and the Congress cause unnecessary utili-
zation of personnel and material-
DEPARTMENTAL RECOMMENDATIONS AND BUDGET DATA
The enactment of t} e proposed legislation would not involve the
expenditure of any Federal funds.
The proposed measure is a part of the Department of Defense legis-
lative program for the S4tlI Congress and has been approved by the
Bureau of the Budget. The Department of Defense recommends that
it be enacted by the Congress, as is evidenced by the letter dated
January 6, 1955, from Secretary of the Army Robert T. Stevens., which
is attached hereto and made a part of this report.
lion. SAM RAYBURN, JANUARY 6, 1955.
Speaker of the House of Representatives.
DEAR MR. SPEAKER: There is forwarded herewith a draft of legislation to repeal
P+iblic Law 820, 80th Congress (62 Stat. 1098), entitled "An act to provide a
revolving fund for the purchase of agricultural commodities and raw materials to
be processed in occupied areas and sold."
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This proposal is part of the Department of Defense legislative program for
1955 and the Bureau of the Budget has advised that there would be no objection
to the presentation of this proposal for the consideration of the Congress. The
Department of the Army has been designated as the representative of the Depart-
ment of Defense for this legislation. It is recommended that this proposal be
enacted by the Congress.
PUOPOSP; OF THE LEGISLATION
The basic objective of Public Law 820, 80th Congress, commonly called the
Natural Fibers Revolving Fund Authority, was to assist in the industrial rehabili-
tation and economic recovery of occupied areas. It was felt that until these
countries could be restored to a basis of self-sufficiency, American taxpayers
would have to continue to foot a large bill for reeding and clothing the people of
these areas.
Public Law 820, 80th Congress, provided for a revolving fund for the purchase
within the United States of vitally needed agricultural commodities and raw mate-
rials to be processed in occupied areas and sold. Proceeds from the sale of prod-
ucts of commodities purchased with money from the fund were utilized to repay,
with interest, outlays from the fund. Japan was the only area to take advantage
of the provisions of this act and did not make any purchases with money from this
fund after January 1950. In view of the ratification and confirmation of a treaty
of peace with Japan, and no anticipated requirement for utilization of money from
this fund by the remaining occupied areas as defined by the act, no further need
seems to exist for time fund as created by authority of Public Law 820, 80th
Congress.
LEGISLATIVE BEFERF.NCES
An identical proposal was included in the Department of Defense legislative
program for 1953 and was submitted to the Congress on January 5, 1953. That
proposal was introduced as II. R. 2312, passed the House of Representatives on
May 19, 1953, and was referred to the Senate Committee on Agriculture and
Forestry. No further action was taken on that bill.
COST AND BUDGET DATA
This proposal would cause no apparent increase in budgetary requirements for
the Department of Defense.
Sincerely yours,
ROBERT T. STEVENS,
Secretary of the Armq.
CH.\N(ES IN EXISTING LAW
In compliance with clause 3, of rule XIII of the Rules of the House
of Representatives, there is herewith printed in parallel columns the
text of provisions of existing laws which would be repealed or amended
by the various provisions of the bill.
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4. REPEAL] KG THE NATURAL FIBERS ACT
EXISTING LAIR
,Public Law 820, 80th Cong.)
To provide a revolving fund for the purchase of
agricultural commodities and rap materials to be
processed in occupied areas and sill.
Be it enacted by the Senate and House of
Representatives of the ilni'ed States of
_l nserica in Congress assemnbled, That,
notwithstanding the proviuions of atty
other larv, the Secretary of the Ary is
authorized to issue notes from time' to
time for purchase by the Secretary of the
Treasury, not to exceed in the aggre-
gate outstanding at any time $150,-
000,000. Each such note shall bear
interest at a rate determined by the
Secretary of the Treasury, taking into
consideration the current average rate
on outstanding marketable obligations
of the United States as of the last day
of the month preceding thi issuance of
the note. Payment of the purchane
price of such notes and repayments
thereof by the Secretary of the Army
shall be treated as public-debt transac-
tions of the United States. The pro-
ceeds of these notes shall be used by the
Secretary of the Army, or ifs duly atx-
thorized representatives, as it revolving
fund for the purpose of (aj purchasing
natural fibers (including cotton waste)
produced in the United sates, and
such other materials, including starch,
dyestuff, roller leather, and card cloth-
ing as may be used in processing and
finishing such fibers; (b) transporting
such fibers and other matera.ls to occu-
pied areas, making them available for
processing, and having such fibers proc-
essed in such areas; (c) insuring such
fibers and materials and the products
obtained from such processing; and
(d) selling products obtained from such
processing. In the case of wool, mo-
hair, or flax fiber, only thoem types and
grades shall be purchased hereunder as
the Secretary of Agriculture., in the light
of supplies on hand in the united States,
designates as available for export; and
stocks held by Commodity Credit Cor-
poration of the types and grades so
designated shall be purchased before
other purchases are made of such type?
an,t grades. For the purpose of this
Act an occupied area shall he considered
as any liberated or occupied area, which
is et the time, occupied by United States;
forces or such an area occupied jointly
with another power or powers when ii
is considered by the Secretary of tho
Army to be necessary or cesirable to
include such an area, in order to carry
out United States objectives: Provided
That a. treaty of peace shall not have
been ratified and confirmed or such ar
area.
That Public Law 820, Eightieth Con-
gress (62 Stat. 1098), entitled, 'An"Aet
to provide a revolving fund for the pur-
chase of agricultural commodities and
raw materials to be processed in occu-
pied areas and sold", is hereby repealed.
SEC. 2. This Act shall take effect on
June 30, 1955.
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REPEALING THE NATURAL FIBERS ACT rJ
EXISTING LAW THE BILL
SEC. 2. Neither the Seci etary. nor any
duly authorized representative, shall
use the fund created by this Act for the
purchase of any commodity unless, on
the date of purchase of such commodity,
it appears in his best-judgment that
within fifteen months after such date--
(a) such commodity will be proc-
essed, or used in processing opera-
tions, in an occupied area; and
(b) so much of the products ob-
tained from such processing will be
sold under such terms and for such
currencies as will be necessary to
cover, in United States dollars, (1)
allamounts expended from the fund
in connection with such commodity
plus (2) an appropriate portion of
the interest payable to the Secre-
tary of the Treasury on account of
loans made pursuant to this Act.
Sue. 3. The proceeds from the sale of
products of commodities purchased
with moneys from the fund, to the extent
of the amounts specified in section 2,
shall be returned to the fund.
Sue. 4. Annually after the date of
enactment of this Act the Secretary of
the Army shall make a complete report
to the Congressw'ith respect to the status
of the fund. At such time as there shall
no longer be any occupied area within
the meaning of this Act, or at such
earlier time as the President or the
Congress by concurrent resolution shall
determine that the fund is no longer
required for the purposes of this Act,
the unobligated balance of the' fund
shall be repaid to the Secretary of the
Treasury; and the Secretary of the
Army, as expeditiously as possible con-
sistent with orderly liquidation, (a)
shall cause to be sold so much of the
commodities purchased with moneys
from the fund and products thereof
which are then on hand as may be
necessary to obtain the amount of any
balance then remaining owing to the
Secretary of the Treasury on account of
loans made pursuant to this Act, and
(b) shall repay such amount to the
Secretary of the Treasury.
SEc. 5. Fibers and other materials
purchased for processing in any par-
ticular occupied area may, if a treaty
of peace is ratified and confirmed with
respect to such area prior to the proc-
essing of such commodities, be proc-
essed and sold, or sold, in such manner
as the Secretary of the Army may deem
to be in the best interest of the United
States. If, after purchasing any such
commodity with moneys from the fund,
it shall appear to the Secretary of the
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6 REPEALIYG THE NATURAL FIBERS ACT
Army that the product of such con -
modity cannot be sold for as much as
the amounts specified in cla zses (1) and
(2) of section 2 of this Act the Secretary
of the Army may sell such product for
a lesser amount; but, insofar as may be
possible, no commodities s'iall be sold
for less than the amounts specified in
clauses ((1) and (2) of section 2 of this
Act.
Sr.c. 6. So much of the commodities
purchased with moneys from the fund
for processing in any occupied area and
so much of the products thereof as are
not required to be sold, and so much of
the proceeds obtained from the sale of
any such commodities or products as is
not required to be returned to the fund
shall be used and disposed of by the
Secretary of the Army, in such manner
as he deems fit, for the benefit of the
economy of such occupied area.
Snc. 7. In providing for the per-
formance of any of the functions
described in section 1 the Secretary of
the Army shall to the maxi - um extent
feasible utilize private channels of trade
and is hereby authorized to make all
necessary rules and regulations for the
efficient implementation of the pro-
viSions of this Act.
Approved June 29, 1948.
O
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