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'1'0 '1'HI SEORUARY f# !HI: '"" II RIPLY '1'0 'ftlll 80 'l'BIS OAlf FILE.

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THE SECRETARY or THE NAVY.

WA& .... INC3TON ,

. , ) April 1~ 19JJ . ... ~-

My dear Mr . Presi dent:

I enclose you her ewith a letter from Admiral Pratt , Chief of Naval Operations , and also a let ter f rom Admiral Opha.Jll , Chief of the Bureau of Navigation, which t hey consider it their duty to write me, and which I consider i t my dut y to transmit to you.

The offi cers of the Navy with whom I have entrust ed the consideration of $260, 000, 000, the amount assigned the Navy by the Director of' the Budget, !Lr. Douglas, after full consul tation in t r ying t o meet your des i res in the ma t ter, have r eached t he conclusi on that $270, 000, 000 i s the l east t hat the Navy can possibly be oper ated on.

I BJll advised t hat i t i s i mpossibl e to have the Fleet operated on $260, 000, 000 with any degree of safety or efficiency. The only condi t ion i n which they think it can be oper ated on $270, 000 , 000 would be i n a lump sum, and even under these condi t i ons it would be necessary to make dr astic cuts in the shore facilities .

If we can ge t $230, 000, 000 for new construction, this would materially help the shore establishments on the East Coast.

The Department has shown a f ine spirit in con­forming wi th your wishes i n this matter, and feel t hat with t he $270, 000, 000 as above indi ca ted, and with $230,000, 000 f or new construction, they can handle the situation somehow.

I have sent a copy of t his letter to the Director of the Budget, as up to this t i me I have been unable to make arrangements to confer with him,. as he has been exceedingly busy.

With kind r egards a nd best wishes, I am

Sincerely yours,

The President, The V•hi te Bouse .

, ... ) )

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SERVICE Ll- 1(362) Nav-61- IR

NAVY DvAJn'MEHT

B U REAU OF NAVIGATION

WA8HfHOTON, D. C.

J'rom: To :

1 2 APR 1933

The Ohler ot the Bureau of NaYigation. The Seoretar7 of \be Navy.

Expandituree 193~- Proposed reduction or Appropriations .

Reference: (a)

(b)

c.u.o. SERVICE ltr . or 3 April 1933, tile Op-38-A~-FF1(1~34)/A~-3(320510) , Budget Officer ' s SABVICE ltr , ot 6 April 1933, tile A4-3 (ll) (l934)/FF(33020l)lffiO/McL-E.TK.

1 . Rataranoa (b) contains certain tentative proposals regarding e. limitation or the upend! turea tor the t! seal year 1934, I teal i t my duty to indicate the ser ious impairMent or neval personnel which would r esult fran the adoption of the propo~l relative to Pay , Subsist ence and Transport a ti on .

2 , Referring to t he Appropriation , Pay , Subaia t anoe and Transportation, the amount provided tor 1934 is:

Deductions

Appropria t1on 'l'renatarred tran clothing

and small stores Total a vailable

(a} The Act to maintain the credit or the Uhited States reduces compeneation to officers and

$142,977 ,450

1,750 ,000 ¥1'h, 727 ,456

men, 1~~ • .......••. , .. . ..... .. . . t l!5, ~0 0 , 000

(b) Dany promot ions to enlisted men . 1 , 000,000

(o} Tentative allowance by Navy Budget Offi cer estimate ••• •• • • •• 122 , 000, 000

(d) Balance t o be saved • •• • •••• ..•• ~.--~6~·~2~2~7~·~'~5~0

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~. The balanoa {t6,12'1,4.60) to be aaTed from thia appropria­tion under the figure aaaigned by the Navy BUdget Office can coma only by reducing personnel. To maet t his figure by •uch reduction would require:

(a) Oiaoontinue all tirat eDli a tmenta tor 19 34.( tiaoal) thereby an in8 men , a pproximately •• •• ••..••••• •• • • 6,000

(b) Deny re-enli stme nt to approx-imately . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7. ooo Total reduction in 12 months .••••• • 13 ,000

ATeraga t or . t he year ••••••••• 6, 500 The t o tal en1iated peraonnel on 1 J uly 1934 would then number 66, 700 (approximately) aa against 79,700 now in t he aervioe . Under preaent o oodi tiona wt tb 7 9, 700 men , ahtpa allowancea average 74.. 7~ ot com­plementa . With the reduction to 66 0 700 the average percentage would be 60 . 6~t I believe the Secretary of t he Navy would not be ready to aocep reaponaibility tor t he reaulting unreadineaa of t he Fleet, ~d this aaide from t he haToc t o morale that would unquestionably result were we to deny re- enlistment to many me n who by r eason ot long aerTice and tine recor da haTe bean encouraged to look to the !Ja•y tor t heir lite work. The number added to unemployment 1a a taotor to be recognized , but a more aerioua phaae lies i n t he t hought that auoh men faced with reJection by t he Government would become f ertile aoil for aubTersive propagan4a which is being conatant1y handed to our enlisted men - without effect to date.

4. While aver ready to co - operate in tull measure in the r eali zation ot all poaaible econom1es, and ready now to accept t he tull amount of cute suggested in reference (b) , I ware remiss in m.y duty to t he ~cratary ot the Nn y did I tail to make or record t his analysis of what would result from those cuts.

5 . I t is therefore apparent that t he reduct i on or the ap­propriation -Pay, Subs1 atenc~ and Tr ansportation" should be re­atricted t o the I UIII of $16, 5000000 , leaving aTC1lable tor expendi­tures $128 , 227 , 4.50. I n my opinion , t Lis is the maximum reduction i n the "Pay, Subsiatlillce end Transportation" appropriat i on that can be made without further s eriously impeiring the e nlisted per­s onnel u an important rector in t he national def ense .

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