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Equipment.--Some progress was made during the past year in modernizing the equipment of our Army. Much remains to be done, but the steps already taken encourage us in the hope that in the next few years our small force will be supplied with the latest and best in equipment, weapons, and mechanical transport.

Recent improvements have made important changes in weapons and in combat vehicles, increasing the fire power and mobility of military units. These changes render obsolete much of the equipment used by armies in the World War. The reequipment of even a small force, such as ours, with the latest in weapons and mechanical transport would involve a very heavy outlay of funds. To provide a complete war reserve of such equipment would not only involve a prohibitive expenditure, but, in view of the rapid improvements that are taking place, would prove unwise as such a reserve might be outmoded in a few years. Nevertheless our forces should be familiar with the latest equipment, and should be trained in its practical use. Hence it appears the part of wisdom to supply certain of our units with the most modern weapons and other equipment and through experience to develop the best tactics for

As certain equipment approaches standardization its adoption can be extended throughout the service.

Because of limited appropriations our Army has been slow to make the fullest use of motor vehicles, so necessary to the rapid movement of troops and supplies. However, in the past 2 years substantial progress has been made in this direction. Many of our field artillery regiments and of our field and service trains have been motorized. Animal transport and pack trains will continue to be necessary under certain circumstances, and mounted soldiers will still have an important role in modern warfare, but the great speed of motor vehicles and the expanding network of good roads indicate that for movements on highways armies will rely very largely on motor transportation. During the past year a considerable number of combat vehicles and of motor trucks has been purchased and much of our artillery has been converted froin horsedrawn to motor-drawn. As funds become available this program will be continued.

Air Corp8.-Modern equipment for our Air Corps presents a somewhat special problem, because the radical changes and astonishing improvements that are being made from year to year in aircraft design indicate that the airplane is not yet a standardized article which may safely be procured in large quantities without danger of obsolescence. Moreover, the tactical employment, the efficacy, and the limitations of aerial warfare have not been fully demonstrated by practical experience.

Nevertheless, the air element will undoubtedly play an important part in modern warfare, and the latest combat planes have reached such a degree of efficiency that they will unquestionably remain useful for a number of years, even if improved models should come out. A sound preparedness policy, therefore, dictates that we should at least equip ourselves with enough of the most modern fighting planes to repel an invader at the outbreak of hostilities. At present our air force is far short of its reasonable requirements. Under the most favorable circumstances it will be several years before this shortage can be met through the adoption of an orderly procurement program. The life of an airplane is relatively short and in a few years it has either become worn out or is obsolescent by reason of new developments. Hence the unnual requirements merely for replacements are high.

With a view to developing and equipping our force with modern planes of the best type I urgently recommend the inauguration of a 5-year aircraft-procurement program under which approximately 800 airplanes of various types will be procured annually. It is estimated that of this number approximately one-half would be required for replacement purposes and the other half would augment the present strength. At the end of this 5-year period we would possess at least 3,000 combat airplanes of modern design, plus a considerable number which could be used for training, transport, and other purposes. Last year I endorsed the recommendation of the Baker Board for 2,320 planes by the end of 3 years. It does not seem to me that the 5-year program above suggested is inconsistent with that recommendation.

Aircraft procurement.The procurement of aircraft so as to insure that the Government shall get the best equipment at the lowest price has been the subject of more or less controversial discussion. The War Department has adopted a policy which I believe to be in the interest of the Government. I cannot explain it better than by quoting the following letter: Hon. J. J. McSWAIN, Chairman, Committee on Military Affairs,

House of Representatives. DEAR MR. McSWAIN: At the time of the adoption of the present War Department policy for the procurement of aircraft the Assistant Secretary of War took the position that the policy would have to be in operation at least 2 years before sufficiently definite results could be obtained to render final Judgment upon its efficacy. Although this policy has been in effect only 1 year I feel that sufficient progress has been made to warrant a report to your committee at this time, and I am therefore setting forth below the results obtained to date and my opinion of what may reasonably be expected in the future.

Briefly the policy calls for the placing of contracts for quantity procurement of airplanes as a result of competitive bids submitted by the industry. Advertisements submitted to the trade are on a performance specification basis and require each competing manufacturer to submit with his bid a sample airplane complete and ready to fly. A period of from 8 to 12 months is allowed between the issuance of the advertisements and the opening of the bids to give the manufacturers adequate time in which to design, construct, and submit the sample airplanes for test. Award is made on the basis of a predetermined method of evaluation of which the bidders are made cognizant in the advertisement. This evaluation places a premium upon improvement in performance, and award thereunder is made to the highest evaluated airplane, thereby assuring the Government's obtaining the finest available aircraft. The advertisement further contains certain minimum-performance requirements which are based upon the maximum performance of the finest known airplane at the time of issuance of the particular advertisement and provides that no consideration will be given to any airplane that does not at least come up to these requirements.

This policy gives full rein to the inventive genius and engineering ability of the manufacturer and permits the incorporation in the sample to be submitted of all worth-while developments practically up to the actual date of opening. For example a certain manufacturer arrived at Dayton, Ohio, with the airplane which he proposes to submit on a particular proposal about a month prior to the date of opening of bids. After arrival at Dayton he apparently decided that the plane could be additionally improved and consequently has had a crew working upon it consistently since its arrival. If advertising had been based upon detailed specifications and drawings with no incentive for turning out the finest possible type of airplane, it is fair to assume that proposals would have been received offering airplanes meeting only these detailed specifications and drawings and not including therein the engineering developments which have taken place since their issuance many months before.

The making of awards under this system on the basis of a tested article rather than on a “paper promise to perform " has an additional marked advantage. It enables the War Department to make contracts for quantity procurement with the knowledge that the manufacturer has actually demonstrated his ability to construct the finest available type of airplane, thereby eliminating the service test of an article which would be necessary if samples were not required. This factor alone reduces by at least a year the elapsed time between the inception of a design and delivery of airplanes in quantity to troops in the field and eliminates to a great extent past criticism to the effect that airplanes are becoming obsolescent by the time they reach the hands of tactical organizations.

The War Department is gratified at the response of the industry to the new procurement policy. On standard equipment competition has been keen and has resulted in a great deal of engineering work on the part of manufacturers. It is fair to say that progress in the art has been materially advanced, moving ahead according to the belief of some people intimately connected with the industry as much as 3 to 5 years. Furthermore, manufacturers are offering airplanes whose performance exceeds expectations. For instance, a basic training airplane now in service has a top speed of about 125 miles per hour while the basic trainers contracted for under the present system have a top speed of over 200 miles per hour. It appears reasonable to assume that no such advance would have been made at one stroke without the incentive of competition and the assurance that award would be made to the manufacturer offering the most advanced airplane.

When the present policy was originally adopted it was felt in some quarters that it would result in reducing the available sources of supply for the different types of airplanes. It was the opinion of the War Department that a competitive policy of procurement would give the opposite results, and I ani gratified to be able to state that such is apparently the case. For example, 6 manufactorers offered basic training airplanes in the last competition while 4 manufacturers entered observation airplanes. I am informed that three manufacturers will offer bombardment airplanes in that competition, bids on which are to be opened the 22d of this month. Reliable press reports indicate that each of these 3 companies has built and has ready for test a bombardment airplane which will far exceed the performance of any bombardment plane now known, with speeds ranging over 200 miles per hour, cruising range exceeding 3,000 miles, and with greater useful loads than have heretofore been thought possible. Press reports further indicate that the Glenn L. Martin Co., which is now manufacturing a quantity of bombers for the Army, is offering a newly designed airplane in the competition under discussion. It is fair to assume that had procurement continued along the lines previously followed this company probably would have offered for this year's consideration the present type of Martin bomber with certain refinements and improvements rather than an airplane of completely new design and development.

In addition to quantity procurement competitions the War Department is holding design competitions on many types of aircraft. These competitions were opened May 6, 1935, and resulted in 17 manufacturers entering the competition for pursuit airplanes and an average of 3 manufacturers in each of the other competitions. The necessity of giving preference to the work inFolving contracts for quantity procurement because of present shortage of airplanes in the Army and the amount of detail work necessary to evaluate the design competition have precluded any final determinations to date. It is expected to announce the winners of the design competitions at an early date, and it is hoped that the designs submitted will be sufficiently advanced to warrant the manufacture of experimental airplanes in accordance therewith.

I regret that the present procurement policy has not been in effect sufficiently long to enable me to furnish your committee more concrete information, but I feel certain that the progress and development outlined above are sufficient to enable you to conclude with me that the success of this policy is most promising and that nothing should be placed in the way of continuing the present method for a sufficient period to determine definitely its net worth. Sincerely yours,

(Signed). GEO. H. DERN,

Secretary of War. General Headquarters Air Force.—One of the most important steps toward improved national defense that was taken by the War Department during the past fiscal year was the organization of the new General Headquarters Air Force. This force is composed of practically all of the combat elements of the Air Corps in continental United States, together with certain observation and service units. The various elements of the force are at flying fields throughout the country, but are so organized as to permit their concentration at any point without delay. The commanding general of the Genéral Headquarters Air Force is directly under the Chief of Staff in time of peace and of the commander in chief of the field forces in time of war. This force is highly mobile and possesses great striking power. It will be able to employ its mobility in such a way as to exert the maximum influence upon land defense, being ready to reinforce the Army on any front.

The elements of the General Headquarters Air Force have been grouped in three territorial subcommands or wings, with headquarters on the west coast, the east coast, and in the south central section of the country. Each wing is strategically well located, and at the same time is in a position to reinforce the other wings.

One important change in policy coincident with the organization of the General Headquarters Air Force is to relieve the Chief of the Air Corps of the responsibility for training, administration, and command of Air Corps units. The Chief of the Air Corps is thus enabled to give his undivided attention to procurement, technique, and aviation schools, which are of great importance in this highly technical arm.

The Air Corps has lacked officers of rank appropriate to the command of many of its units, and because of the technical nature of the duties it was not feasible to transfer higher ranking officers to this arm. To remedy this situation, advantage was taken of authority contained in the act of 1926 and many Air Corps officers were given temporary promotions. With the enactment of the new promotion law Air Corps officers shared with other officers in permanent advancement, so that the number of temporary promotions required will be greatly reduced.

Shortly after the close of the fiscal year a bill authorizing the establishment of military air bases and depots in strategic locations became a law. This act establishes an important military air policy, but funds to carry out the purposes of the act are not available. In order that the object of the act may be attained, I recommend that sufficient funds to begin the acquisition of land and the construction of these bases be appropriated. A special board has been appointed to study and report on all available sites.

In developing its policy of air defense the War Department has been greatly aided by the report of the special committee headed by the Honorable Newton D. Baker, former Secretary of War, which was undoubtedly the best study ever made of our Army Air Corps. This committee reported its findings a year ago and practically all of its recommendations are already being carried out, either through administrative or congressional action.

Army housing.--In the past 2 years considerable progress has been made in the Army housing program which was initiated several years ago. Several new Army posts, particularly at flying fields, have been constructed. At other stations flimsy, unsightly, insanitary buildings of temporary construction have been replaced by new, modern structures, specially designed for the purpose intended.

A considerable portion of the funds used for continuing the Army housing program came from allocations made by the Public Works Administration. These funds not only provided the Army with needed facilities but also served materially to stimulate recovery of the building industry.

Army housing is considered a desirable public works project for many reasons, including the following:

1. It is widely distributed, since Army posts are scattered all over the United States.

2. Plans and specifications are ready, hence construction can be started promptly.

3. It furnishes employment for the building trades, which were hardest hit by the depression,

4. It helps the heavy goods industries and stimulates recovery. When the construction industry is revived the depression will be over.

5. It gives the Government full value for its money in the form of needed public improvements and results in a direct saving in a reduction in rentals and the elimination of losses from fire and other hazards.

6. Finally, it must be done some time, so why not do it now when it is so badly needed for the relief of unemployment and for hastening recovery?

Plans and detailed estimates have been prepared covering urgently needed Army construction, totaling approximately $120,000,000. Estimates have also been prepared covering the expenditure of about $137,000,000 for additional construction, reconditioning and repair work considered highly desirable at Army installations. A list of these projects has been submitted for consideration in connection with work relief allotments under recent congressional appropriation. Most of the funds thus far allotted to the Army from this fund have been for repairs and rehabilitation rather than for new construction.

The accomplishments in Army housing have been so beneficial to the Service and to the public, and have contributed so materially to general recovery, that I earnestly recommend that additional funds for the prosecution of the housing program be allotted as soon as possible, either from funds now available or from future appropriations.

NATIONAL GUARD During the past year the National Guard continued to make satisfactory progress. "On June 30, 1935, the strength of the National Guard was 13,370 officers, 201 warrant officers, and 172,244 enlisted men, approximately the same as for several years. The Army Appropriation Act for the fiscal year 1936 authorized an increase of 5.000 in the National Guard. While this will materially strengthen the Guard it is recommended that an additional 15,000 men be au

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