Special Message to the Congress Recommending Legislation for the Disposal of Government-Owned Synthetic Rubber Facilities
To the Congress of the United States:
The Rubber Act of 1948, as amended, requires my legislative recommendations with respect to the disposal to private industry of the government-owned synthetic rubber facilities. When at the onset of World War II the United States was denied access to its normal supplies of natural rubber, a huge government-owned synthetic rubber industry was created at a cost of some $700 million. There remain in government ownership facilities which cost approximately $550 million and which now supply nearly all of the nation's requirements of synthetic rubber, which, in 1952, amounted to 806,500 long tons out of a total consumption of 1,260,000 long tons of new rubber. Pursuant to the Rubber Act, these facilities are operated for the government's account by a number of rubber, petroleum and chemical companies.
The policy of the United States with respect to rubber is stated in Section 2 of the Rubber Act, which provides as follows:
"It is the policy of the United States that there shall be maintained at all times in the interest of the national security and common defense, in addition to stock piles of natural rubber which are to be acquired, rotated, and retained pursuant to the Strategic and Critical Materials Stockpiling Act, a technologically advanced and rapidly expandable rubber-producing industry in the United States of sufficient productive capacity to assure the availability in times of national emergency of adequate supplies of synthetic rubber to meet the essential civilian, military, and naval needs of the country. It is further declared to be the policy of the Congress that the security interests of the United States can and will best be served by the development within the United States of a free, competitive synthetic-rubber industry. In order to strengthen national security through a sound industry, it is essential that Government ownership of production facilities, Government production of synthetic rubber, regulations requiring mandatory use of synthetic rubber, and patent pooling be ended and terminated whenever consistent with national security, as provided in this Act."
In accordance with Section 9(a) of the Rubber Act, the Reconstruction Finance Corporation on March 1, 1953 rendered a report to me and to the Congress concerning plant disposal. Having considered that report, and after consultation with the National Security Resources Board, I recommend the prompt enactment of disposal legislation.
I am in hearty accord with the policy determination of the Congress that the security interests of the nation will best be served by the development within the United States of a free competitive synthetic rubber industry, and I believe that now is the time to undertake plant disposal. The program recommended in the report of the Reconstruction Finance Corporation appears to provide the basic outline of a satisfactory method to achieve this result.
The nation's security in its rubber supply is, of course, of paramount importance in any consideration of the disposal of these facilities. For such security, two things are essential, namely, an adequate stock pile of natural rubber and a healthy, progressive synthetic rubber industry. Our stockpiling objectives are adequate and have been virtually achieved and, from the economic and technological data available to me, I am confident that if the government-owned synthetic rubber facilities are sold as recommended, competitive private industry will amply, efficiently and economically supply our synthetic rubber requirements.
Disposal of the government-owned facilities must be consistent with three objectives. In the first place the government should realize their full fair value; secondly, disposal should be effected in such a way as to ensure to the consuming public, and to large and small rubber fabricators the benefits of fair competition; and finally, to ensure against the hazards of unforeseeable contingencies the facilities must be sold on such terms as will guarantee their ready availability for the production of synthetic rubber in time of emergency. Disposal pursuant to these criteria will best serve the public interest.
The program proposed by the Reconstruction Finance Corporation is designed to achieve these objectives. Accordingly, I recommend the enactment of legislation which would permit the prompt implementation of such a program, recognizing at the same time that upon examination in detail, modifications of that program may appear necessary or desirable.
I have not prepared the text of legislative proposals to implement the recommendations of the Reconstruction Finance Corporation. It is my belief that such legislation would most appropriately result from the joint efforts of representatives of the interested executive agencies and those committees of the Congress having this matter under consideration.
DWIGHT D. EISENHOWER
NOTE: The report of the Reconstruction Finance Corporation entitled "Program for Disposal to Private Industry of Government-Owned Rubber-Producing Facilities" and dated March 1, 1953, was published by the Government Printing Office ( 61 pp., 1953).
On August 7, 1953, the President approved an act authorizing the disposal of Government-owned rubber producing facilities (67 Stat. 408).
Dwight D. Eisenhower, Special Message to the Congress Recommending Legislation for the Disposal of Government-Owned Synthetic Rubber Facilities Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/273580