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Wilfred J. McNeil Oral History Interview

Wilfred McNeil  

Oral History Interview
with
Wilfred J. McNeil

Fiscal director, U.S. Navy, 1945-47; special assistant to Secretary of Defense, September, 1947; Assistant Secretary of Defense and comptroller, Department of Defense, 1949-59.
September 19, 1972
by Jerry N. Hess

[Notices and Restrictions | Interview Transcript | List of Subjects Discussed]


Notice
These are transcripts of tape-recorded interviews conducted for the Harry S. Truman Library. A draft of each transcript was edited by the interviewee but only minor emendations were made; therefore, the reader should remember that these are essentially transcripts of the spoken, rather than the written word.

Numbers appearing in square brackets (ex. [45]) within the transcript indicate the pagination in the original, hardcopy version of the McNeil oral history interview.

RESTRICTIONS
This oral history transcript may be read, quoted from, cited, and reproduced for purposes of research. It may not be published in full except by permission of the Harry S. Truman Library.

Opened December, 1979
Harry S. Truman Library
Independence, Missouri

[Top of the Page | Notices and Restrictions | Interview Transcript | List of Subjects Discussed]



Oral History Interview with
Wilfred J. McNeil

New York, New York
September 19, 1972
by Jerry N. Hess

[1]

HESS: Mr. McNeil, would you give me a little bit of your personal background? Where were you born, educated, and what are a few of the positions that you have held?

MCNEIL: I was born in Boone, Iowa on February 21, 1901, although the Navy records show 1900.

HESS: Why did the Navy records show 1900?

MCNEIL: Somebody had to be in World War I.

HESS: So you lied about your age to get in.

 

[2]

MCNEIL: No. I just got in the hands of an energetic recruiting officer.

HESS: Where did you go to school, sir?

MCNEIL: High school in Grinnell, Iowa. I joined the Navy from high school.

HESS: When did you get out of the Navy?

MCNEIL: The fall of 1919. And I stayed on with the Navy as a civilian until August 1920.

HESS: Where did you go from there?

MCNEIL: I went to Iowa. My dad had a country bank in Iowa. He wanted to reduce the time he spent in the business, so he wondered if I'd come back and start to take over.

HESS: How long did you stay with the bank?

MCNEIL: Three years, then I bought an interest in a small bank in Colorado. Out in the dry land.

HESS: Where in Colorado?

 

[3]

MCNEIL: Brandon. I was there for four years, then came back to Iowa and went in the automobile business. I was a distributor in northern Iowa.

HESS: What did you sell?

MCNEIL: Nash. Which was an up and coming company.

HESS: That was an up and coming company back then?

MCNEIL: The best engineering in the business at the time. Our competitor of course, was Buick. Then that wasn't very profitable, so I got a contract for distribution of the Des Moines Register and Tribune in northern Iowa about 1928. After the thing started to make some money the Des Moines Register and Tribune decided to take me off of contract and put me on salary and that was where we separated.

HESS: Were you a reporter?

MCNEIL: No. Circulation.

 

[4]

Eugene Meyer at that time bought the Washington Post, and I think Gardner Cole, Sr., sometime or other, mentioned that I might fit into his plans for building in Washington. So I got a call from Eugene Meyer. I came down and had a discussion and started to work for Eugene Meyer.

HESS: About what time was that?

MCNEIL: About the beginning of '34. Just after he bought the Post in a bankruptcy sale. The Post was the smallest paper in town circulation-wise. I remember Eugene's instructions: when I asked him he took me over to a map of the United States and he said, "The damn thing's a desert, make it bloom." Those were my operating instructions. I said, "Do you want to do it by home delivery, news dealer circulation, how do you want it done?"

He said, "That's what we're hiring you for."

 

[5]

That's how I happened to get in the newspaper business. From there I went back into the Navy in 1941.

HESS: Did you pretty well increase the circulation of the Washington Post?

MCNEIL: All you have to do is look at the records. We soon passed the News and the Times and the Herald. And then they combined the Times and the Herald and we started to outdistance them. Yes, that was a twenty-four hour a day job.

HESS: Then you went into the Navy again.

MCNEIL: The reason I did, really, was that along about 1939 Eugene Meyer was convinced that there was going to be a war. At that point in 1939 we ran about two three-inch headlines on masthead for three or four months, "It's later than you think."

The editor of the Washington Post, Felix

 

[6]

Morley, would not believe that there had to be war. He just couldn't believe it. I remember at a Friday luncheon we always had, Eugene announced that Felix Morley and I were going to Europe. This was before the war started and we would see the crown heads of major countries in Europe. And when we came back Mr. Meyer was more convinced than ever that it was headed that direction.

Felix Morley said, "There didn't have to be war." He was a Quaker. And it didn't have to be, but there was.

He was replaced by an editor from the Christian Science Monitor. I forget his name. Morley became Haverford College president, which was a pretty good college. He was the brother of Christopher.

Meantime the last officer I served under in World War I happened to have duty in the Navy Department. And we had dinner once a month for maybe a year or so. So suddenly it

 

[7]

seemed the right thing to do to put in an application for military duty. I had to go before a special board convened for the purpose, which was all right. I was called back to duty by June 1941.

HESS: What was your first duty?

MCNEIL: I had a job I was entirely unqualified for. I was the Deputy Disbursing Officer for the Navy Department.

HESS: How did you get that job if you were not qualified for it?

MCNEIL: The officer that I served under in World War I was the Disbursing Officer of the Navy Department and handled settlement of all the major contracts at that time for the Navy. He was the last officer I served under in World War I, so he asked I be assigned to him.

Pearl Harbor came along shortly, but meantime

 

[8]

we were in an area of terrifically increasing workload because the Navy was starting to expand rapidly. In February 1942 my boss was ordered to take command of the Naval Supply Depot at Bremerton -- Puget Sound. So I got his job as Disbursing Officer. I had to do a little homework to keep up with the staff. They'd explain something to me that I didn't understand and I had to take it home and work it over before I saw them in the morning.

HESS: What size of a staff did you have in Washington?

MCNEIL: Oh, I guess it ran about 1200.

HESS: Where were your offices at that time? Were they down on the mall?

MCNEIL: First on Constitution Avenue and then we had five wings of one of those temporary buildings back of the pool. That was in the beginning.

 

[9]

HESS: The old Navy buildings that Roosevelt had constructed during World War I.

MCNEIL: That was where we were before, up until just after Pearl Harbor. Then we built the new temporary buildings and we moved back of the pool.

HESS: You were released from active duty with the rank of Rear Admiral in 1945, right?

MCNEIL: Yes, but in the meantime Forrestal asked if I would be Fiscal Director of the Navy. He established a new job.

HESS: Forrestal did?

MCNEIL: Yes, on December 2, 1944. So I left the job of Disbursing Officer of the Navy Department. Incidentally, that job as Disbursing Officer was really part of the Bureau of Supplies and Accounts which supervised all other Disbursing Officers throughout the system. It was kind of a controversial job because in the

 

[10]

military a Disbursing Officer, whether it's a Finance Officer in the Army or Disbursing Officer in the Navy, is quote, "personally responsible," for all payments regardless whether the contract agreement is legal or not. So it's your duty then to question both the legality and propriety of anything you do. So when you get into contracts with escalations and what not, to question them does make sense. Yet you have to do that without interfering with the progress, say, of making engines at Hartford, Connecticut or whatnot. You can't be a stumbling block while you are trying to be careful. What gets you into controversy with senior officers is if you contract with anybody else. If you just refuse to pay, why, that brings it to an issue immediately. And that was the way, really, I met Forrestal.

HESS: When did you first meet him?

MCNEIL: It must have been late '42. I think it was about a controversy as to whether we would

 

[11]

go ahead with building amphibious gliders for the Marine Corps, and I found that the Marine Corps didn't want them. I found that four or five people building them weren't worth a damn. I refused to pay and, of course, that made it a joint issue with the Bureau of Aeronautics, and Forrestal then was Under Secretary in charge of current release contracts. So we had a knockdown-drag-out fight and Mr. Forrestal refereed.

HESS: What was your opinion of Mr. Forrestal at that time?

MCNEIL: He was one of the greats. Extremely confident, understood things quickly. He was very shy, but when faced with a decision he'd make it. You could force him to make it, I'd say. I don't mean it quite that way either. He had no problem making decisions on the facts of the case. The one big problem was that he had an insatiable curiosity for facts and sometimes you get so many facts you continue to have

 

[12]

trouble.

HESS: You get bound up in the facts pertaining to the matter.

MCNEIL: Too many things. That's a terrible statement, but I think, perhaps, you understand what I mean.

From that time on I used to see Mr. Forrestal quite frequently. Lunch perhaps once a month or more on some subject. The subject could be almost anything, and it was a bit of an education to me. Then starting in December, Forrestal was very unhappy about the whole fiscal setup of both the Government and the Navy in particular. He wanted somebody to pull the picture together so that when he asked a question he got the answers. First, I had invented or drawn up a different system of operating the disbursing office and it attracted a little bit of attention, I guess. He had asked a management engineering firm named Paget-McCormack, something

 

[13]

like that, to do this. Dick Paget, the chief man, was resident manager and an engineer, but he was forced particularly to use outsiders. But after making a study of it he asked if I would take the job of trying to remodel and put the thing together. That job started December 2, 1944. At that time I was really part of Forrestal's office as Fiscal Director of the Navy. And he put the management engineering functions and administrative functions of the Navy under the same job. It was his goal at the time to have a permanent Under Secretary of the Navy and he wanted to know if I would do it. I told him no. I didn't believe in that. I thought a continuing Under Secretary would be all right, if you get the distinction. Continuing gives it some permanence, but permanent is, I think, bad. One just gets the job and lays down on the job.

The Navy used to have that problem with the old Chief Clerk of the Navy back in the

 

[14]

thirties. They couldn't get rid of him and he just didn't work anymore. I think "continuing" means you stay on the job as long as you are performing but you are subject to change at anytime. The main thing is for carryover between administrations. In the military there should be some continuity in the secretariat. Forrestal was a great believer in having internal checks and balance and that's one way to get it.

HESS: I see that you were Fiscal Director as a civilian from '45...

MCNIEL: First in the military. I took the uniform off in the fall of '45 after the war was over and stayed on as civilian Fiscal Director. And then at the time when the Unification Act was passed...

HESS: September of 1947.

 

[15]

MCNEIL: Yes. Forrestal asked if I would go over and help organize the Department of Defense.

HESS: And you were his Special Assistant?

MCNEIL: Yes, I was. And the Unification Act provided for three statutory special assistants. That was one of the interesting ideas in order to see if you couldn't build by evolution, and to eliminate what a lot of people were critical of; that is, you'd have a lot of clerks around the holding company headquarters giving orders to senior people like Secretary of the Navy, Chief of Naval Operations, Secretary of the Army, and so forth. And this was intended to emphasize the fact that the three jobs were, quote, "staff" to a Secretary of Defense who had a line of authority to the Secretaries of Army, Navy, and Air. It was done to emphasize that, although when you come to budgeting which has been one of my jobs, when you delete an item or reduce an estimate, you're pretty well

 

[16]

giving directions. Here's an indication of why that's true. Immediately after the Unification Act became effective the Air Force got divorced from the Army. They got all hepped up about executive privilege. One day in the Appropriations Committee they wouldn't give John Taber and Clarence Cannon the background of accident reports, saying that they were privileged and so forth and so on. Finally after an hour of discussion John Taber shifted himself out of the chair and he stood up and he said, "Well, gentlemen, I believe you are right; if it doesn't take money we have no interest." That afternoon the Air Force delivered three tons of accident reports to the House.

HESS: Just weren't going to give them any money.

MCNEIL: "If it didn't take money we have no interest." So that's one reason the budget job was really, so fascinating. There wasn't a thing you could

 

[17]

do; where you decreased money, you eliminated an item. I worked for six Secretaries and as long as they supported me I felt pretty good. If anyone didn't support me, of course, I was in trouble. But they all did, so I was fortunate. They started on September 18, 1947.

HESS: Then in 1949 you became Assistant Secretary of Defense and Comptroller.

MCNEIL: It was the same job, really.

HESS: A little bit of reorganization there between the National Military Establishment and the Department of Defense?

MCNEIL: Yes, but I say my duties were almost identical to what they were before; in fact they were identical. The basis for that was Title 4 of the National Security Act. I developed the whole thing, with the help of Ferdinand Eberstadt and Franz Snyder at the request of Herbert Hoover. The Hoover Commission had been asked what could

 

[18]

be done to make operation of the military more effective. Hoover had some ideas as a result of the Hoover Commission work, and I was the Department of Defense representative in the Hoover Commission on these things. Hoover suggested that Eberstadt might want me to give him some ideas. Well, I had been working on several things back in '45, '6 and ‘7. We put the different ideas together and it became Title 4 of the National Security Act. The title for the National Security Act was broken up when they re-codified the laws into the Army, the Navy, and the Air Force. So it's pretty hard to find a separate section at the moment, although the provisions have not changed in any way, shape, or form.

First, in order to establish some kind of a mechanism which would last, it was felt desirable to make the comptroller functions a part of the legislative requirements for our

 

[19]

organization. Also it was one way to keep a staff which would give some semblance of internal check and balance, and provide an audit function both over operations and money. So it required the establishment of a Comptroller of the Army, Navy, and Air Force and that one of the Assistant Secretaries would be given that duty.

Next it called for a change in the whole system of budgeting. In years past the budget required a separate appropriation for water coolers; a separate appropriation for newspapers; separate appropriation for travel; separate appropriation for certain civilian hire; but nowhere could you tell what a function cost. Nowhere could you tell what the operation of a hospital cost. In other words, 269 pots of money it took to operate the hospital at Bethesda. A little money here for fixing a fence and a separate appropriation for this and that. To run the Task Force One to test the A-bomb out at Eniwetok, it took 189 pots of money. I wanted

 

[20]

them to fix it so that in any one job the money was all in one place to do the job. Then an eighth grader can explain it and justify it. I don't mean to downgrade, but you have military officers and you give them technical accounting questions; you see, it's really not even fair. You ought to rig a system that a good captain of industry or a good commander of a regiment could understand quickly and easily. If he has his money to maintain an airfield or a station all in one pot, or one pot for maintenance, one pot for new construction, he has a chance then to say, "Well, I can save some money here and spend a little more money for paint, I won't have to re-roof until next year," and so forth. It would give him a little more latitude all the way down the line with the money under much better control. So that was the system that Hoover bought and Congress bought at the time called performance budget.

 

[21]

HESS: Did the various services give you very much trouble on this?

MCNEIL: Yes. When I was Disbursing Officer in the Navy I was paying money out of 500-odd different appropriations. I wanted to reduce that to National Guard and Reserve in case of the Navy and the Air Force and the Army. In the case of the Navy the military pay, major procurement, maintenance and operation, and research were all the pots of money I wanted, because I could run the operation with that kind of breakdown, and Congress bought it. It requires certain trust by Congress in the people who are operating the place. Unfortunately, in the period between 1960 and 1970, we lost credibility and Congress has now started to break up the appropriations into numerous little accounts.

HESS: So it's regressing to the way that it used to be?

 

[22]

MCNEIL: Yes, rapidly, because Congress can't trust them to spend money. They do too much juggling. No, actually they are not doing so much juggling as Congress thinks they've been doing, but they don't take the time to explain it. If I have anything to be boastful about it was our relationship with the Appropriations Committee, which was one of pretty complete trust and we tried to earn it every day.

HESS: Who were the chairmen of the Appropriations Committee?

MCNEIL: Clarence Cannon and John Taber. [George] Mahon was chairman of the subcommittee. Harry Sheppard was the Navy Committee and later Mahon. And oh, we had [Joseph C.] O'Mahoney and a number in the Senate. But in the House it was Cannon and Taber.

Next, one of the things this legislation provided for was taking all printing plants, laundries, Navy yards, and arsenals out of the

 

[23]

appropriations structure altogether -- no money appropriated for their operation. The only way they would get their money would be by billing the customer for work he'd ordered. Immediately you place responsibility on the person that's buying the material. I can give you an illustration; the munitions board used to send out 25,000 copies every three months of a mobilization bulletin. It didn't cost anything because somewhere somebody bought the paper; somebody paid the people. They just ordered them and they would give them out free.

After we put the printing plant in the basement of the Pentagon we took it out of the appropriations structure, put it under working capital, and, in other words, made it a corporation. The only source of money was what they got from collecting for the work they did. They started to bill them $2.25 a piece. Immediately the staff said, "Well, my God, that's criminal." The first thing they'd do is squawk

 

[24]

at the price. The next thing they did is go back home and cut the list down. We used to send the Department of Commerce 300 copies; they cut them to ten. They went through and finally there weren't enough people interested to print it at a11. And nobody -- no managing engineer or study group -- issued a gold embossed report saying they should cut it out; they didn't. Even Marx Leva used to print a thousand copies of the legislative program. When he found it cost him about $5 he didn't send out so many. We learned the decision was Marx Leva's, who's not a management engineer. As I put it at the time, I wanted to get some system to where the selfish aspect of human nature worked for you. The minute you can do that you get somewhere. I wanted the fleet commander when he sent a destroyer into the New York Navy Yard to be critical of the bill he got. If they replaced the forward turret, I wanted that priced. Well, it hasn't worked perfectly but it's worked

 

[25]

pretty good. Laundries, bakeries, and so forth, overhaul shops, navy yards are what we call working capital. Without Eberstadt and Herbert Hoover, I as a bureaucrat could not have sold this package. Eberstadt was a master. He helped write the Unification Act. But he knew his subject and he came down and he spent thirty days with me. We had to sell the Treasury and the Bureau of the Budget. The Bureau of the Budget objected to this incidentally.

HESS: Why? What were their objections?

MCNEIL: They thought they'd lose some control, I think. They were accustomed to the old system of providing money for water coolers and so forth. They finally testified against it but Congress still did it. I was told I shouldn't do it, but I was trying to get fired for these several years so I could make some money. That was the establishing of working capital. Incidentally, to show you the degree of confidence,

 

[26]

I would like to think, we asked for no appropriations to get this working capital started. And incidentally the first big "corporation" we established was the Military Sea Transportation Service. The Navy would not take the job of providing sealift for our Air Force and Army and have it in their budget. In their budget they wanted to buy a destroyer or an airplane, but they didn't want to do housekeeping for somebody else. They didn't mind running the place if they could. So then in MSTS we developed a tariff, such as $150 for sending a soldier to Europe. Okay, they were willing to haul him. So you've made it possible to get some consolidation of activities just because of the nature of the thing, whereas you could not do it if you tried to make it an administrative assignment.

HESS: You were working business practices into the operation of the military?

 

[27]

MCNEIL: That's all, that's all. Now to get the working capital, to get this started, Congress gave me authority to take all unexpended balances from all appropriations and transfer it into continuing accounts. Say a hundred million dollars was left over from operation of the Army or Navy. The money would be dead after it lapsed. I could transfer that into continuing money, and it would last forever on the books of the Treasury. And this law says: "The Secretary of the Treasury shall upon request of the Secretary of Defense transfer lapsed money into this continuing account." That took some faith from the Harry Byrds and the Saltonstalls who were pretty conservative people, and they all bought it, So I felt pretty good about that.

Next this same authority gave us authority to establish inventory accounts. In other words establish a Sears Roebuck to carry common use items under money control in Army, Navy, and Air.

 

[28]

The Navy started that about the turn of the century and was pretty successful with it. I merely made it applicable to Army and Air Force. In other words, if the Navy wanted to get some spare parts from the Air Force for a certain model engine and so forth, and paid them for it, Air Force was more or less glad to serve them. Had they been required to issue them free they would have found they were out of parts. Those were the types of things. But when you had a Sears Roebuck merchandising corporation out of all the common use supplies in Army, Navy, and Air, the first time in history the Army had their stuff under money control, and that applies to the Air Force, too.

Then they gave you authority for special jobs -- for example, another A-bomb test in the Pacific that was of interest to Army, Navy, Air, and the Atomic Energy Commission. The commander could go out there with one single pot of money and pool it and distribute it after the work was

 

[29]

done on the basis of the best guess. That was the kind of latitude we had and losing it really makes me sick. Because you need that kind of authority if you are going to run the business smartly.

During the war I had a hell of a time because they run a bus service around the San Francisco area, and it went by Army installations and so forth, but it didn't pick up airbase kids. But the minute the Army could run a bus service, and get paid for this on the basis of the best guess as to the amount of traffic, they were happy to do it for their new sister service. So it made a lot of things possible.

HESS: What reasons are they using to get away from that now?

MCNEIL: They're not getting away from it as much as they are being forced to get away from it because the budget system got pretty complicated

 

[30]

under [Robert] McNamara. It took them years to wake up to the fact that he was not as competent as people thought. And finally when the reaction set in, it was a reaction against him and everybody that worked for him. And they haven't recovered it yet.

Now [Melvin] Laird spent most of his four years working with Congress and giving in sometimes, trying to recover some of the loss of credibility. But in the meantime, he was still dealing with cost overruns, the C-5A, which was a McNamara type contract, but the laundry work on that contract was all under Laird. He had the Roman type contract which was really a McNamara philosophy of a cradle to the grave type of contract. A completely unfair type of contract on both sides; but the laundering and cleaning up of that is all in this last three or four years.

HESS: Why is that an unfair contract?

 

[31]

MCNEIL: First, a fixed price contract for research and development is wrong. Somebody gets screwed. Either the contractor makes a bundle, Uncle Sam pays too much, or the contractor can't break even. Therefore, you get into the Lockheed type thing; Grumman type problems; right straight down the line. Research and development, stepping out on a new deal just has to be on a cost basis. They might have cost incentive and so forth, and clearly do all you can to encourage them to do it cheaply. Give them a bigger margin of profit because it's the smart way. But a company worth two hundred million dollars cannot take a two and a half billion dollar development deal and come out. It's unfair to Uncle Sam; it's unfair to the stockholders. Now, when you can develop an airplane for five million dollars in a hundred million dollar company that's a different problem. Even so I was against fixed price contracts for research all the time I was in the Navy and in

 

[32]

the Pentagon. It's wrong. You either make a killing or go broke. Now once you know what you want to buy then handle it competitively, even competitive with incentive afterwards. I have no sympathy for the contractor if he makes a mistake on that, because he's been given a chance. But you find every other time, either Uncle Sam has overpaid or the company is in trouble, if you go on a cost basis.

HESS: Is your opinion of Mr. McNamara rather negative?

MCNEIL: It certainly is. I hope not unfairly. If you take a list of the missilry and aircraft developed during his period, it has increased by a storm.

HESS: The TFX was one.

MCNEIL: Yes. I was chided, I say chided instead of criticized, one of the last times I was

 

[33]

testifying, for having 40 new programs underway.

HESS: Forty programs?

MCNEIL: Yes. Major programs, comparatively new anyway, some of which were duplications. We were making progress on 40 and eventually we'd cancel half of them, perhaps; but still it was the cheapest way to get along. Everyday you developed something a little bit better. But you were doing it the hard way. Now when I was on the Blue Ribbon Panel we tried to emphasize that they ought to go back to prototype development with aircraft. You can't prototype a B-1. That would be too expensive. I mean two or three prototypes, different companies. But if you go back in history you will find that we practiced a little bit of what we preached. The financing of the F-4 and the F-8U-3 -- I don't know whether those numbers mean anything to you or not. The F-4 is the present McDonnell fighter -- the best

 

[34]

fighting interceptor we've got today. We built 4,000 of them. But back in the fifties the Navy really liked the F-8U-3, which was built by Temco Vought. Well, as a budgeteer we financed, and I think we were being criticized by the Bureau of the Budget - and to a degree by the President and Congress, for continuing on the F-8U-3 and the F-4 for over a year and a half. There was a feeling then that these airplanes were pretty good, but that we can only have one of them. Let's let the lieutenant commanders and the Marine captains fly the damn things for a year and we will find out which is the best.

HESS: Let the pilots say which one is the best airplane.

MCNEIL: That's right. So the F-4 was chosen. Well the F-4 has been one of the world's most successful airplanes. It's being built right today. Fairchild builds it, too. It's now up to 4,200 and I see in the paper this morning the Air Force

 

[35]

is going to buy some more next year, and that's a 1955 model.

HESS: Which is rather amazing for aircraft.

MCNEIL: Yes. It's a great airplane.

HESS: Like I say, many times they are obsolete when they come off the drawing board.

MCNEIL: Right today there is a competition going on for a ground support fighter to be built for the Air Force to support Army troops, called the A-9 and the A-10. It's a competition between Northrop and Fairchild. They were the two selected out of the eight who made proposals. They selected two to build prototypes. They are flying right now. I was out there last week to see the A-10 fly and they are almost ready to turn it over to the Air Force. The Air Force is going to fly them for some months. They need it to find out if they want something

 

[36]

different on the airplane or if this is perfect, whether they like the Northrop airplane or like the Fairchild version the best. Meantime, the contract is so worded that novel ideas that Fairchild's got cranked in can be used by Northrop, if they happen to win the competition. Now they cost forty million dollars each to develop those two prototypes. So that will be eighty million dollars it costs to find out which one you really want. By that time you are ready with specifications and say, "I want the T-34 engine, I want this, and I want that." Contracts are then bid with some knowledge of what the hell is facing them. Meantime, you've probably spent 5 percent of the program's value to get a working model. That's not bad. So you have to have a little courage to say we are going to step out and spend eighty million dollars to find out what the hell the answer is and get a working model. But it's being done now in two or three different phases and it's a new policy, and on the

 

[37]

Blue Ribbon Panel we recommended very strongly that they follow that in the future. But in the McNamara thing the judgments were made all on the basis of paperwork. And some of the paperwork would run thirty-five thousand or forty thousand pages, and you can't tell me you make a decision that way. I'd rather take a lieutenant commander's or an Air Force major's opinion as he climbed out of the airplane. I used to keep one-third of my budget staff on the road all the time.

HESS: Did you?

MCNEIL: Yes, On the 38th parallel in Korea or in an overhaul shop. We'd look at the tag on the engine. The engine would have three thousand hours; okay, we'd check then to see how many engines would last that long, and then we judged their budget markup from that. That's the only way I know how you run a railroad. Take a look.

 

[38]

HESS: Keep a man in the field and see what's going on.

MCNEIL: There was a big fuss on the ammunition shortage under the Truman administration, but there wasn't an ammunition shortage. I had my man, who used to be, incidentally, General Marshall's man at Normandy, who was a competent observer.

HESS: Who was that?

MCNEIL: John Holcomb. He's dead. He did a magnificent job. He was a colonel in the Army, but he was strictly objective and he was accepted throughout the whole Eighth Army. I knew as a budgeteer he was probably more up-to-date than the Secretary of the Army. I didn't have any administrative layers between us.

And if you look at the budget appropriation passed just last week you will find they are setting up an Office of Tests. They appropriated

 

[39]

twenty-seven million dollars, providing it as an independent office reporting to the Secretary of Defense. That's one of the jobs we used to try to do as part of the budget. We would send people out to Edwards Air Force Base or down to Patuxent to find out what the hell the boys found out when they flew the airplanes. That's one way to do it. The Office of Tests is the formal way to do it. I'd rather do it informally but this is better than nothing. I'm getting off the track probably.

HESS: That's all right.

MCNEIL: Well, that's the essence of this legislation, but it still hasn't been changed one iota in the whole period. Here's a copy of the committee report. We rewrote that report from testimony. Carl Vinson knew every word in that thing. I don't know whether that's of any value or not?

HESS: It's very good.

 

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MCNEIL: I would say it took four years to get that passed. I told Congress it would probably take ten years to get even a good start on implementing it. That's one reason I didn't quit some years earlier, I think, because I kind of wanted to see my baby grow up.

HESS: And you stayed there until 1959, right?

MCNEIL: Yes. I had six Secretaries as bosses.

HESS: Six Secretaries - that we'll get into.

Let's go back just a little bit. What are your earliest recollections of Mr. Truman? When did he first come into the picture as far as yo