Memorandum from Milton P. Kayle to David Stowe

THE WHITE HOUSE the WASHINGTON June 19, 1952 MEMORANDUM FOR MR. STOWE Stb ject: Selective Seizure under Section 18 of the Universal Military Training and Service Act The following are the steps which need to be taken to set Section 18 seizure into operation on a selective basis. This assumes that as a result of your discussions with Defense officials you have singled out a number of specific plants for operation. l. A letter should be submitted to the President by NSRB advising that resort to Section 18 authority is required in the interest of the national security. (This should present no problem though I assume Jack Gorrie should be put on notice.) 2. An executive order, or letter, should be issued authorizing an agency head, presumably the Secretary of Defense, to place Section 18 mandatory orders. (This requires consultation with Justice and Defense. Justice has had such an executive order in "standby condition" so this should not require much time.) 3. Defense should then place at least one mandatory order with each of the plants which have been designated for restoration of production. (This requires consultation with Defense and Justice, who will be defending this action in court. We might also want to check with the Atomic Energy Commission to see if its main needs would be met from the plants in question. There are certain questions which have to be answered, - must we place a direct Government purchase order with each plant or is it sufficient to merely underwrite existing orders placed by a prime contractor; how long must we wait before there is a "failure to fill the order" so we may seize the "struck" plant; how can we make the strongest case for operating the facility at peak production; how far can we go in distributing the end products of all-out operation. There is certainly an answer to each of these issues but we should get a policy understanding with the agencies on these problems at the outset.) Assuming the events which have taken place justify seizure, the Presi- dent should, again by executive order, authorize an agency, presumably Defense, to take possession of and operate the plant in question. (Once the Government seizes, a question will arise regarding changes in wages and working conditions. To be consistent with our earlier stand on this subject I should think we would