Numbers appearing in square brackets (ex. ) within the transcript indicate the pagination in the original, hardcopy version of the oral history interview
Opened March, 1964
Oral History Interview with
June 17, 1963
Charles T. Morrissey
MORRISSEY: Let's begin, Mr. Lawton, by having me ask you: do you recall your first meeting with Mr. Truman?
MR. LAWTON: The first time that I met him was during the consideration of the Roosevelt Reorganization Program in 1938 ('38 and '39). I was working with the Senate Select Committee on Organization which was at that time, chaired by Senator [James F.] Byrnes. During the debate on that we had arrived at one rather crucial vote when everybody was being brought back into town to vote and I met him in the Capitol, in the cloak room, actually. Byrnes had stopped to talk to him about the vote on the Bill and I happened to be with Byrnes and just simply was introduced; I didn't take any part in that conversation. The only conversation
I actually had with him before he was President, was during the time that the Truman Committee was making studies of defense expenditures. This particular one involved the CANOL Project in Canada. The Budget Bureau had just made a survey of that project and the Committee was anxious to borrow a copy of the Budget report. We felt there were a few conditions attached to its use that we wanted to be sure of, so my conversation was with respect to lending the report to the Committee, and the use which the Committee intended to make of it. It was again a rather brief conversation and simply confined to that particular point. The first time that I began meeting with him on a regular sort of basis was after [James] Webb had been appointed Budget Director and I went over a number of times to conferences with the President, with Mr. Webb.
MORRISSEY: Did you have any dealings with Senator Truman about his involvement with railroad reorganization legislation or civil aeronautics legislation?
LAWTON: No, not at that time. Most of our activities in the Budget Bureau dealt with the clearance of legislation,
and advising the agencies concerned as to the administration's position on the legislation.
MORRISSEY: Did you have any other dealings with Senator Truman when he was heading the Truman Committee in addition to the CANOL Project?
LAWTON: No, I didn't; some of the others did.
MORRISSEY: Could you tell me something about Mr. Truman's attitudes towards budgeting?
LAWTON: Because of his experience on the Senate appropriations committee, he had a pretty good understanding of the process and it was a matter in which he was rather deeply and genuinely interested. He went into budgetary problems in quite a bit of detail, wanted to know more than just the brief, general picture; he wanted to get into the reasoning behind recommendations--wanted to get a complete grasp of the picture. As a matter of fact, he spent a considerable portion of each budget season on going over, item by item, the requests of agencies. The Budget Bureau prepares a rather detailed statement covering each appropriation and the reasons for the
Budget's action on the agency request. It's summarized, but still it covers all the salient points that are in the budgetary requests to enable the President to make an informed judgment. In the case of controversial issues, he's usually given a pro and con picture of each item.
MORRISSEY: Who would give this pro and con picture?
LAWTON: Well, the Director and one or two of his principal staff people would usually be there, ordinarily the Director, the Assistant Director and the Chief of the Estimates Division, or as it is now called, the Office of Budgetary Review.
MORRISSEY: You refer to the budget season. When is this?
LAWTON: Well, actually, there are two. In the late spring (May, June) we used to make a preview of the following year before we actually requested estimates from the agencies. We'd get a picture, generally, of what they were thinking about and a preview also of the economic outlook and the revenue likely to result from it. We presented to the President a sort of capsule preliminary
view of what the next budget might look like so that he could establish some guidelines for the submission of estimates. Those guidelines were based on the pricing policy to be used, whether we would permit any increase in cost because of a possible rise in prices, things of that sort. Of course, we were in a period following the close of World War II, and the redevelopment of industry and national economy, so that there was a changing price situation. Also the question of whether in general areas, such as public works, whether we would permit any beginnings of new programs or whether we would hold the line to the completion of projects already under way.
MORRISSEY: What would prompt the President to begin a new program in one case, but "hold the line" in another?
LAWTON: Well, in the immediate post-war area, there was the question of the scarcity of construction materials, steel, concrete, things of that sort. Most of the available material was assigned for use of industry in catching up on its backlog of construction that had been postponed during the war period. If we were going to get new plants underway, the Government shouldn't be in the field competing. The competition from new Government
programs at the same time as industry was in the market for it would push prices up too quickly and too high. Actually we had a moratorium for a while on the use of construction materials even on going projects. Later on, when business had satisfied its needs for plant expansion, then the Government could begin to move in selectively on its own deferred needs for construction. It could begin to catch up on the backlog of deferred public works--flood control, reclamation, things of that sort that had been held up during the war period because of the necessity of converting material to war effort. Then it was a question of balancing the Government's use so that it would not distort the economy. It's a question, really, of timing, when you could best meet the needs which the Government had for construction purposes. The same is true of new programs in fields which were non-users of material, but were necessary to achieve social gains. Their timing was dependent, to some degree on the readiness of plans, but to a larger degree, from the budget point of view, on the availability of funds. At the time of the Marshall Plan, we had a large new program beginning, and we had a tax problem to balance with it.
MORRISSEY: Could you enlarge on this?
LAWTON: As you began to recover, your economy began to build up, the tax rates began to be more productive than they had been before, and there was money available to meet the requirements of aid, particularly, because that aid itself to a great degree, was helping to spur on our own economy. The purchases of a great many of the materials were being made in the United States; the money was being spent here, even though the product was going abroad. There was an impetus to the American economy in the orders that were being placed here and the goods that were being purchased here.
MORRISSEY: Do you have any prominent recollections of the part the Bureau of the Budget played in the formation of the Marshall Plan?
LAWTON: There were several committees that were involved in the plan, outside the Budget Bureau. The Budget Bureau did some facilitating work; we loaned personnel to some of the committees. But it was mostly a liaison function; a function of being aware of what was going on and a function of providing information as to
organization and finances.
MORRISSEY: Let me go back a bit and ask how you came to be an adviser to this Senate Select Committee on Government Organization in the later thirties?
LAWTON: The Budget Bureau was a central organization responsible to the President. It was one of the few staff organizations that existed at the time and the committee, headed up by Louis Brownlow (the President's committee), that had made the reorganization study and report, was anxious to have someone work with the Senate committee, who had a grasp of what had gone on, and be a point of contact between their committee and the Senate committee. The Senate committee had asked the Committee on Administrative Management to make arrangements for someone to come down and serve as a staff consultant and adviser for the committee. The staff of the President's committee was an ad hoc group that had been drawn together from universities and other places for development of the report, and they were not available for any long time liaison operation. I was then an administrative