The European Recovery Program
The other day we received a breakdown on the first year allocation of five billion dollars to the European Recovery Program. Of particular interest was that section showing a billion dollar allotment for plant equipment and machine tools. We gather that newly manufactured equipment will have the preference. In this light, we could not help but recall the extent to which private industry went during the war, when every dealer was searching every important plant in the nation for idle machines.
Rebuilt or reconditioned machinery costs less than new. ERP dollars could be spread considerably if some of these practices were put in use. This procedure could also aid the American manufacturer in upgrading his own machinery because the demand for these older machines would be increased.
Aside from the financial slant, anyone can recognize the inadvisability of shipping only new machinery overseas, a practice that will deplete the normal supply from the equipment manufacturers.
In another look at the surplus picture, we find that JANMAT has earmarked some 60,000 machine tools for future emergencies. Now comes news that only about one-third of the aircraft tools in this reserve bank have been processed for storage. Idle machines deteriorate quickly unless properly preserved. This may seem tragic, but experts point out that only about 20 per cent of these tools could be used in a future armament program, since changing designs in propulsion aircraft and heavy weapons will outmode a great portion of tools now being earmarked.
The WAA bungling was mentioned on this page a month ago. That organization still has thousands of tools in surplus inventory. We understand that the WAA surplus is being screened for ERP, but if it turns out to be a repetition of the WAA debacle most of it will never see Europe.
It is our contention that a thorough study should be made by the Economic Cooperation Administration with the aid of competent rebuilders and experienced surplus machinery men, and not with the builders of such machinery. If this procedure is adopted, we predict that millions of dollars will be saved and the European Recovery Program will be accelerated.
The sending of rebuilt machinery and equipment to Europe would benefit all users of machinery in the USA. The dealer and rebuilder would be in a position to pay a fair price because he would have an assured market, and the user in turn would have more moneys to purchase more modern equipment for his shop.
As the situation stands, the main beneficiary in the ERP will be the manufacturer of new machinery and equipment. Now scheduled for overseas, these new products could be readily absorbed at home, and by the same token provide a valuable conservation of steel, copper and other critical metals.
ECA should consider this opportunity.