some of its space to provide office room for various emergency relief agencies. This has served to aggravate the already overcrowded conditions under which the Department functions and the great disadvantages resulting from the partial occupancy of numerous widely separated buildings. Hence, in the interest of efficiency and economy, I wish to renew the recommendation that I made last year for the immediate construction of a suitable building to house in one structure the War Department activities in the District of Columbia.

THE ARMY OF THE UNITED STATES

In this report I shall not attempt to deal in detail with the organization, equipment, training, and administration of the Army of the United States. Those subjects are adequately covered in the annual report of the Chief of Staff and the reports of the heads of the various arms and services. However, I wish to comment generally on the strength and improvement of the components of our Armythe Regular Army, the National Guard, and the Organized Reserves. I am happy to report that in training, morale, and general efficiency there has been a steady improvement in each of those elements of our defense force.

REGULAR ARMY

Strength. On June 30, 1935, the strength of the Regular Army, exclusive of the Philippine Scouts, was 11,979 officers and 118,727 enlisted men. In the Philippine Scouts there were 58 officers and 6,371 enlisted men. The strength of the Regular Army on that date was practically the same as it had been for several years, the number being limited by the amount appropriated each year for its maintenance, although the authorized strength fixed by the National Defense Act is approximately 18,000 officers and 280,000 enlisted men.

The Congress took a very important step in the War Department Appropriation Act for the fiscal year ending June 30, 1936, by making funds available for an increase in the enlisted strength of the Regular Army from 118,000 to 165,000 men. This will stiffen our national defense establishment, which was too small to carry out its assigned missions, although it is still far below the minimum of 280,000 deemed necessary by the National Defense Act. The recruitment of the additional men began immediately after the close of the fiscal year covered by this report, and indications are that the increased strength will be attained before the close of the ensuing fiscal year. The new recruits are of a particularly desirable type. Nearly all of the new men are being assigned to combat units.

In providing for this increase in the Army enlisted strength, the Congress adopted a recommendation made by the military experts 10 years ago and renewed annually since that time. Frequent studies by the War Department General Staff disclosed that the least force that could successfully carry out the essential duties of the Regular Army should consist of 14,000 officers and 165,000 enlisted men." It will be observed that while the Congress authorized an increase in the enlisted strength to the extent required, no increase in the number of officers was directed. The need for additional officers is also urgent. They are required not only for service with Regular Army organizations and installations, but also for duty with the National Guard, Organ

ized Reserves, and Reserve Officers' Training Corps units. I earnestly recommend that Congress authorize the commissioning of these additional officers in annual increments until a total strength of 14,000 is reached.

The increase in the Corps of Cadets at the United States Military Academy from 1,374 to 1,960 was necessary to avert a future shortage of officers. The first class to be enrolled under the new authorization entered the academy during July 1935. The members of this class who complete the course will be commissioned in 1939. These graduates will be needed as replacements for officers leaving the active list. By 1939 the normal separations of commissioned officers will have increased so that the number of graduates from the Military Academy will even then be insufficient to fill the vacancies. Hence to provide for any increase in commissioned strength it will be necessary to draw on young men from civilian life. Large numbers of young college graduates who have had Reserve Officers' Training Corps training and who now hold Reserve commissions will be available for appointment to the Regular Army, and will be excellent officer material.

Personnel. The efficiency of any organization is always dependent in very large measure upon the intelligence, energy, and enthusiasm of its individual members. Such a spirit cannot be maintained without a decent recognition of loyal service. Our Army is no different in this respect from any other organization. I have felt for the last 2 years that the morale and efficiency of our commissioned personnel were endangered by the promotion stagnation. Many officers had spent their entire Army careers in the same grade and the prospect for future advancement was rather dismal. Officers were growing old in junior grades. Under such circumstances it was but human that an officer should become discouraged and be incapable of putting forth his best efforts. It was with the greatest enthusiasm, therefore, that the Army as a whole greeted the enactment of a highly satisfactory Army promotion law.

Under the terms of the new law nearly half of the promotion list officers below the rank of colonel receive immediate advancement, and all of the other officers are so elevated on the list as to bring them from 2 to 8 years nearer promotion than they would otherwise have been. The effect on the commissioned personnel was electrical. Though they had suffered many disappointments the officers had fought off discouragement, hoping that their plight would be recognized and corrected by the Congress. That hope has now been realized, to the great advantage of the Army as well as of the officers.

The new promotion law also provides for voluntary retirement for officers of World War service with graded retired pay. While it is not probable that many officers will take advantage of this provision, it does afford an opportunity for those who wish to retire from active service to do so without the pecuniary loss that they would suffer by resignation.

The Army appropriation acts for the past 2 years have contained a provision that there should be no more than 11,750 officers in the Regular Army whose original commissions bore dates prior to June 1 of each of the years affected. Compliance with this provision necessitated the separation from the active list of about 300 officers, in addition to those affected by normal attrition. This was

accomplished by the retirement of officers not qualified physically for active field service, by encouraging the voluntary retirement of officers of more than 30 years' service, and by invoking class B proceedings against officers regarded as failing to meet the high standards of professional fitness required in the Army. To separate additional officers from the active list by these methods is becoming increasingly difficult, and it is respectfully suggested that directives. of this character be omitted from future appropriation acts.

Pay schedules in the Army, both for officers and enlisted men, are relatively too low. The recent elimination of temporary reductions of pay and allowances, and the restoration of longevity increases, have been of material benefit to the members of the military service, who renounced opportunities for making money when they entered a public career in the Army, and who are therefore entitled to economic security. However, it should be borne in mind that since 1908 there has been only one slight increase in the compensation of Army officers, and that they have suffered financial injury from the higher price level that has prevailed since the World War. In terms of real wages, Army officers and enlisted men are worse off today than they were 30 years ago. I hope that as soon as the economic condition of the country warrants the added expense the Congress will consider an upward revision in Army pay schedules. I wish especially to call attention to the desirability of restoring the reenlistment allowance, the elimination of which has been a genuine hardship on the fine noncommissioned officers of the Army, who render such valuable service in our military organization and who are so frequently overlooked.

During the past year Regular Army officers have been utilized by the War Department and by other executive departments on many tasks not directly related to their military duties. This was especially true in connection with the work of the various agencies set up for the relief of unemployment and for the advancement of economic recovery. These officers applied their broad knowledge of public affairs and their executive and organizing ability to these new duties and invariably discharged them with great credit to themselves, to the Army, and to the Government. By their success in these undertakings they demonstrated the priceless asset the people of the country have in this fine body of professional men, whose training enables them to perform creditably a wide variety of unrelated duties in the public service.

I have availed myself of every opportunity to visit military posts throughout the country and in the Canal Zone. I hope soon to have the privilege of inspecting the Army establishments in Hawaii and the Philippine Islands. At each station I have visited I have been struck by the uniform excellence of the troops and the high standard of efficiency that was everywhere apparent. Despite the many discouragements that the military personnel has encountered, its enthusiasm, morale, and devotion to duty leave little to be desired. I am informed by my military advisers that never in the history of the Army has efficiency been higher than at present. Our defense force may be relied upon to perform its duties in peace or war in a manner in keeping with the finest traditions of our military history.

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 their use. 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 from horsedrawn to motor-drawn. As funds become available this program will be continued.

Air Corps.-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 annual 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 conse