US TO SLAM LID ON ARMS PROFITEERING
WASHINGTON, Dec. 5, 1939
The United States Government embarked today on a limited but earnest effort to eliminate profiteering on certain national defense contracts. Success or failure of the project will have an important bearing on the broader movement to control profits on the whole of the mounting national defense expenditure, and potentially to limit profits on war itself. The Treasury, the War Department, and the Colt's Patent Fire Arms Manufacturing Company held identical signed copies of the first contract to be awarded under the new regime. According to the Vinson-Trammell Act, amended by the National Defense Act last year, certain types of profit are not to exceed 12 percent. The provision applies only to ships or aircraft for the Army or Navy, and it is assumed from the available evidence that the Colt Company will make guns for military planes.
The new experiment was variously attended by optimism and by the gravest doubts as to it success. Secretary of the Treasury Morgenthau said he was determined that the will of Congress must and will be carried out.
The Monitor is looking back at the events of World War II.