American pilots were kept on the ground because of the lack of machines, and as a
result the German airmen came over the American lines in great numbers. Condi-
tions in the St. Mihiel sector were better, the witness said, the Americans having
superiority in the air there.
45
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46 WAB EXPENDITUBES.
What can you tell the committee as to the conditions that existed
over there relating to our shortage of aircraft ?
Secretary Baker. I do not know about that, Mr. Frear. The
principal Imowledge I have of those offensives is from Capt. Ricken-
backer's book, called Fighting the Flying Circus. He describes with
great enthusiasm the big collection of aircraft on the St. Mihiel sector.
Mr. Frear. He was under Gen. Mitchell?
Secretary Baker. I think so. Gen. Mitchell's testimony, by the
way, gives an account of that — the largest collection of aircraft
gotten together in the history of the world. In the Meuse-Argonne
oflFensive, of course, we were fighting along a vast front, and everybody
was fighting there, so that whatever aircraft there were there were
doubtless distributed equitably.
Mr. Frear. But we were at a disadvantage there— what I mean to
say is that as far as the American aircraft were concerned, we had a
very small number comparatively ?
Secretary Baker. I cio not know what the fact is as to that.
Mr. Frear. In this connection, I have a letter from which I wish
•to read very briefly. It comes to me from one who is very close to
me and was over there, but I never thought of referring to it until a
day or so ago, when it was called to my attention oy the boy's
mother, who brought it out of the family files. It describes a con-
dition that was generally felt by most of the soldiers who were there
at that time. It is dated August 11, 1918, and says:
Your past experiences bring you unusually close to the service, and you can appre-
ciate better ^an nine out of ten persons the soldiers' welfare. You can rest aosured
they are doing their part to the verv last and best that is in Uiem. I was never more
froud of my country than I have been since I came up to this location. Even the
rench admit that their greatest efforts do not surpass those of the Americans in the
present struggle. I have seen them going in and afterwards at the hospital. Their
spirit is the most wonderful thing you ever saw in your life. They say uie casualties
in our division (the Thirty-second) are quite laree, but their efforts and their driving
capacity can not be surpassed. Just keep on lending them all the assistance possible-
no one deserves it more. I wouldn't have missed this war for anything. I guess I
have gone through all of the sensations possible for me to have.
If you will only send us more airplanes, and then more and more, it will hasten the
finale. The men are coming througn fine, but the airplanes have disappointed us. We
depend upon these so much more than you can appreciate.
Secretary Baker. That is a very feeling and beautiful letter, and
undoubtedly every word of it is so.
Mr. Fbeab. That was the sentiment of the soldiers over tbere^
their anxiety to get airplanes, was it not ? We all appreciate that.
Secretary Bakeb. Yes; in as great numbers as possible.
Mr. Fbeab. In as great niunbers and as rapidly as possible. And
we did not during the whole period of the war get a fignting machine
or a bombing plane.
Secretary Bakeb. Not a fighting machine or a bomb of American
manufacture.
Mr. Fbeab. The testimony covere many witnesses in these various
hearing^, and this is just to lay a sort of foundation for further ex-
aminations, if we choose to make them, in regard to the situation
that developed. Of course, there is no curing that; it is only a
matter of criticism and to enable us to suggest improvements for the
future.
Gen. Squier was in charge of aircraft at the time the war broke outt
Secretary Bakeb. I do not think so — ^yes; at the time the war broke
out Gen. &iuier was; Gen. Scriven had retired earlier than that
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AVIATION. 47
Mr. Fbeab. And I believe you said you were not following closely
what was being done in aircraft at that time ?
Secretary Bakeb. No; I was not.
Mr. Fbeab. And I understood further that you did not know Mr.
Deeds until he came here ?
Secretary Bakeb. Oh, no; I had never heard of him before.
Mr. Fbeab. He is from your State ? He is from Ohio t
Secretary Bakeb. From Dayton.
Mr. Fbeab. You finally appointed him ?
Secretary Bakeb. I have oeen refreshing my recollection by look-
ing at Judge Hughes's report, and he says that I did; so evidently I
did. It is a matter of record. I had forgotten whether I appointed
him or who did.
Mr. Fbeab. In making a selection of a man for such an important
position it is well to get one who has as good a grasp of the situation
as possible, naturally?
Secretary Bakeb. Surely. •
Mr. Fbeab. And it is unportant to get a man whose personal
actions would be above criticism as far as possible ?
Secretary Bakeb. Certainly.
Mr. Fbeab. One whose record, we will way, was beyond suspicion
of being influenced by personal interests ? Naturally so ?
Secretary Bakeb. Yes.
Mr. Fbeab. In order to make the record complete in regard to
Mr. Deeds, who had charge of aircraft — over what period of time,
would you say, or do you remember ?
Secretary Bakeb. I would not say that he had charge of aircraft
at all; he was always a subordinate.
Mr. Fbeab. He was always a subordinate, but was it not true that
practically all the directions came to Mr. Deeds and from Mr. Deeds,
and Gen. Squier usually indorsed them ?
Secretary Bakeb. I can not answer.
Mr. Fbeab. I judge that from the reports and testimony already
available.
Secretary Bakeb. I do not know.
Mr. Fbeab. Mr. Deeds was chief of the Division of Equipment
August 2, 1917, and of course it has been asserted here that even in
May he was down to Washington, I believe, but I do not know what
his connection was. He was not in the Aircraft Division covering
that time, as I understand ?
Secretary Bakeb. No. I think the first contact of Col. Deeds
with any governmental work was on a fuse board. That is my
recollection of what Judge Hughes says in his report; I had not
known that before.
Mr. Fbeab. Yes; he and his partner, Mr. Kettering, I beheve, was
he not?
Secretary Bakeb. Mr. Kettering? I do not believe he was.
Mr. Fbeab. I am not; positive of that myself. Mr. Deeds was the
executive, or in the executive division of aircraft January 14, 1918,
and so he had been incharge for some little time, under Gen. Squier.
In Mr. Hughes's report, oased upon the testimony that was before
him, he says that Deeds retained his powers and authority for some
time thereafter, until Mr. Potter came in, which was in February,
1918. Do you know when he went out of the service ?
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48 WAR EXPElinJITTTIlES.
Secretary Baker. I can not answer that definitely; I can give you
approximately when it was. After the disposition of the charges
against him that grew out of the Hughes report he was retained in
the service, but not in an active status, until the disposition of those
charges. Then he was discharged from the service. I do not
remember how long it was.
Mr. Frear. He was at his desk here a very short time ago, was
he not ?
Secretary Baker. I think not, sir.
Mr. Frear. The reason I asked that is because one of the Senators,
whose name is very conspicuously mentioned in this report, called
me up to tell me that he was still here.
Secretary Baker. The same Senator told me that the other day,
and I said it was perfectly incredible and I would find out about it.
I inquired about it and found he had not been associated with the
service in any way for many months, but there is a man in that office
who is said to look like Col. Deeds, and it may be that somebody
mistook him for Col. Deeds.
Mr. Frear. Col. Deeds got the title of colonel simply as a matter
of courtesy, I assume ?
Secretary Baker. No; he was an Army officer; he was in the
service.
Mr. Frear. At what time ?
Secretary Baker. I am not certain when that was. There is a
letter in tms report from him to me in which he says I oflFered him a
commission.
Mr. Frear. I imderstand, but he was not in the Army?
Secretary Baker. He was not in the Regular Army.
Mr. Frear. He was not in the Army so far as you know prior to
the beginning of the war ?
Secretary Baker. No.
Mr. Frear. And he had never had any military service ?
Secretary Baker. No; he was a temporary officer.
Mr. Frear. Are you familiar with his record in Ohio ?
Secretary Baker. Well, I have been made famiUar with it since
these inquiries began, but I knew nothing about it before.
Mr. Frear. Of course that was a matter of ordinary publicity, I
can readUy understand, but in the course of your duties would not
not have been brought to your attention ?
Secretary Baker. You mean the fact that he was indicted with
the National Cash. Register people ?
Mr. Frear. Yes.
Secretary Baker. I had never heard of that until this inquiry
began.
Mr. Frear That was a prosecution that was held in 1912 in Ohio ?
Secretary Baker. Oh, I was pretty familiar with that at the time.
It was a matter of ve^ great public interest in Ohio, but the interest
centered around Mr. ratterson, who was the head of that company.
Col. Deeds's name may have appeared in the newspapers, but it
made no impression on anybody.
Mr. Frear. Mr. Deeds was quite a conspicuous man out there.
was he not ?
Secretary Baker. Yes.
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' AYIATIOK. 49^
Mr. FUEAB. And he had some lai^e business connections; that is,
with Mr. Kettering ?
Secretary Bakeb. Yes; but I learned that after these inquiries
began, as i told jou.
Mr. Fbeab. Since the case was sent back by the court of appeals
for a new trial, the only relevancy of that is what would be known
in a general way as to charges against a man, his conviction, if he
was convicted, the character of the charges, and whether or not
they would affect his fitness for filling any certain position. In
other words, a man who was charged with defalcation might be per-
fectly reliable for certain positions, but you would not want to put
him m a bank ?
Secretary Bakeb. If he had been convicted ?
Mr. Fbeab. If he had been convicted, and these gentlemen were
convicted. The decision of the court of appeals, so lar as I gather,
does not affect that question, but there were 50 exceptions that
were presented, and of course, those exceptions were to the indict-
ment and various other things, including admissibility of evidence
and the appellate court reversed them. Now, what would you say
as to that having any bearing upon the determination of whether a
man should be placed in a position of this kind who was chained in
the indictment with having bribed, with having monopolized the
business of cash register companies at that time, with having crushed
opponents — and the testimony was very voluininous on that — ^he
having been indicted by a grand jury and having been convicted
by a jury ?
Secretary Bakeb. Why, I am learning now for the first time that
the indictment included any charge of briberv. I did not know that.
Mr. Fbeab. I will read one of the grounds on which the court of
appeals set it aside, which to my mind should be very interesting
to an able Ohio lawyer.
Secretary Bakeb. I will say to you in this case, this having been
a final appeal, I am sure to agree with you.
Mr. Fbeab. I have here a brief reference to it that I think ought-
to be placed in the record, because it has a bearing on this case.
Secretary Bakeb. It was the circuit court that decided that?
Was that the Federal circuit court of appeals of Ohio ?
Mr. Fbeab. Yes; I so understand.
Secretary Bakeb. There is not a better court in America than that.
If it was tne local circuit court I would not know its personnel, but
if it was the circuit court of appeals it was a CQurt of the most eminent
learning and character.
Mr. Fbeab. Here is one of the exceptions that was granted on
which the case was reversied. I am reading now from volume 222,
page 603, of the report of the Federal court, wherein Cochran was
the judge.
Mr. Maoee. What is the title of the case ?
Secretary Bakeb. I think it is Robert F. Patterson against the
United States.
Mr. Fbeab. I do not find the tide here. I have the full record at
my oflSce. Here is what the court held :
A party monopolizing interstate commerce by employing wrongful means to drive
its competitorB m>m the field does not continue to monopolize such commerce, within
ftct July 2, 1890, section 2, by holding the business so securely after its competitors
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50 WAR BXPBlinJITURES.
have ceased to compete; and hence an indictment charging a monopolizing within
the period of limitations by holding; the business previously obtained by such wrongful
means was insufficient, where it did not allege the doing of anything to maintain and
hold the monopoly during such period.
In other words, the Federal court declares that after a monopoly
has become permanent by defeating all of its competitors and monopo-
lizing the whole business it is no longer subject to punishment, because
an lulegation that it is doin^ something to maintain and hold the
monopoly is not accompanied by positive testimony, when from the
natiu'e oi things it controls the whole business after its competitors
have been destroyed. Is not that the interpretation you put upon it ?
Secretary Baker. They were, of coiu-se, examining the statute. I
do not remember.
Mr. Fbear. They were examining the indictment.
Secretary Baker. They were examining the indictment, which was
drawn under the statute.
Mr. Frear. Yes; drawn under the statute.
Secretary Baker. The Sherman antitrust law ?
Mr. Frear. Yes.
The grand jurors indicted John H. Patterson, Edward A. Deeds,
et al., ftr the following offenses among others:
First. The inducing, hiring, and bribing of employees and ex-employees of said
competitors of said the National Cash Roister Go. deceitfully and wrongfully to dis-
close to said National Cash Register Co. the secrets of the business of the concerns by
which they were respectively employed, etc.
Second. The inducing, hiring, and bribing of employees of carters, truckmen,
express companies, railroad common carriers, telegraph companies, and telephone
companies wrongfully and unlawfully to disclose to said National Cash R^^ister Co.
the secrets of the business of such carters, truckmen, express companies, railroad
common carriers, telegraph companies, and telephone companies, etc., pertaining
to the carriage and transportation of cash registers for all sucn competitors.
Fourth. The using of influence of said National Cash Register Co. and of its agents
with and the making of unwarranted and false statements to banking and other
institutions to injure the credit of said competitors and prevent their sec^uring accom-
modations of money, credit, and supplies convenient and necessary for the carrxdng
on of their business.
Fifth. The instructing and requiring of all sales agents of said National Cash Register
Co. to interfere with, obstruct, and prevent in every way passible, sales of such oom-r
Setitive cash register by said competitors and by agents of said competitors and by
ealers, etc.
The indictment continues and covers several pages. The first
coxmt concludes with the following statement:
And so the grand jurors, afioresaid, u]X)n their oath aforesaid, do say that John H.
Patterson, Edward A. Deeds, et al., during the three years next preceding the finding
and presentation of this indictment at ana within said western ai\asion and southern
district of Ohio, unlawfully and knowingly engaged and consciously participated in
a corrupt conspiracy in undue, imrcasonable, direct, and oppressive restraint of said
interstate trade and commerce among the several States in cash registers and one which
has restrained that trade and commerce by unfair, oppressive, tortious, illet^, and
unlawful means and means which have unlawfully ana irresistibly precluded others
from engaging in that trade in commerce, etc.
The second count against the said John II. Patterson and Edward
A. Deeds sets forth substantially the monopolizing of trade and ct>m-
merce among the several States by the said National Cash Register
Co. of the business of sales of cash registers by the means described
in the fii*st count of the indictment.
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AVIATION. 61
On page 25 of the bill of exceptions appears the statement of the
trial judge:
My jud^ent is that this indictment sets forth the offenses chained with great
particularity and that the request of defendants could not be complied with unless
the district attorney furnish practically all the e\ idence he has. To grant the request
would not be in furtherance of justice, but rather a serious embarrassment of its admin-
istration in this case.
To this indictment the defendants on November 19, 1912, entered
the plea of '* Not guilty, " The jury was impaneled on November 20,
1912. The verdict was filed on February 20, 1913, providing as
follows:
We, the juiy herein, do fina the defendants John H. Patterson and Edward A . Deeds,
et a1., guilty in manner and form as charged in each of the three counts of said indict-
ment. (Signed) R. E. Morrow, foreman.
A motion was made in arrest of judgment. Thereupon the district
attorney moved for sentence, and the court pronounced the following
sentences:
That the defendant John H. Patterson pay a fine of $5,000 and the costs of this prose-
cution to be taxed, and that he be confined in the jail of Miami County, Ohio, for
a period of one year.
That the defendant Edward A. Deeds pay the cost of this prosecution and that he
be confined in the jail of Miami County, Ohio, for the period of one year.
Sentence against defendants was deferred upon notice of applying
for a writ of error, and John H. Patterson entered into a recognizance
in the sum of $10,000, and the other defendants, including Edward A.
Deeds, entered into a recognizance in the sum of $5,000. The bill of
exceptions was filed July 13, 1913, and sets forth the testimony in the
case. On the hearing of the bill of exceptions the court sent the
case back for retrial.
Secretary Baker. Was it ever retried, Mr. Chairman ?
Mr. Fbear. It was never retried as far as I can learn. Do not
misunderstand me. The fact that a man has been indicted and con-
victed and even served his sentence is not necessarily a reason why
he should not be employed for certain kinds of business, and it would
be unjust to the employer as well as to the employee to suggest that
that was necessarily an objection. But when a man has been charged
by a grand jury, as this man was, and convicted by a jury of using
such means to throttle the business of others it surely was notice,
was it not, that that man's record ought to be inquired into very
carefully before he was given a position of responsibility and large
powers that might be improperlv exercised?
Secretary Baker. Unaoubted.ly, Mr. Frear, if I had known that
Mr. Deeds was connected with the cash-register trial at the time he
was tendered to me for appointment I would have called for that
record and would have examined it to determine whether or not he
should be appointed. I did not know it at that time; I did not know
it until long afterwards. But, incidentally, I think I ought to say
that Mr. Patterson and Col. Deeds apparentlv were tried and fined
by a petit jury, and the circuit court of appeals which, as I have told
you, is certainly without a superior in America for ability and charac-
ter, adjudged that conviction bad. It went back apparently to the
district attorney, and apparently the difficulties founa by the circuit
court of appeals were such as to make it appear that a further trial
was not possible, so that the case was never tried. I do not know
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52 WAR EXPENDITURES.
whether they were discharged or what happened, but as the record
stands as to both they were acquitted.
Mr. Frbar. They stand with the case having been sent back for a
new trial. But it is a matter of common knowledge, is it not, Mr.
Secretary, that in the courts it is almost impossible to secure a
permanent conviction under an indictment under the Sherman
antitrust law where defendants are men of large means and fight
the case ?
Secretary Baker. There has been a good deal of difficulty about
that, and 1 hope you will not misunderstand me about it. I have
not any tolerance ifor some of the engrossing and conmaercial repres-
sion that that indictment charges.^ Practices of that kind can not
be too strongly condemned.
Mr. Freak. On the record of a case requiring over a month for
trial in 1913 it is not surprising that the court of appeals on 50
exceptions that were named found sufficient ground on which to
reverse the case, and indicated also that any case that would be
prosecuted against these men, no matter what their guilt was, with
that length of trial and the difficulties that could be interposed
by the defense, could not result in a permanent conviction.
Secretary Baker. I do not believe that.
Mr. Frear. Will you suggest to us any case that comes to your
mind where a conviction has been affirmed under the Sherman anti-
trust law in a case where the defendant was as powerful and wealthy
as these men were ?
Secretary Baker. I do not have a list of them in my mind, but I
am certain I have seen pleas of guilty by men of great prominence in
industry.
Mr. Frear. That may be where it rests with the individual man,
but not where the case is tried and defended by such men.
Secretary Baker. I do not know as to that. I will get the Judee
Advocate General to look into that. I think I have a book in the
library in my office relating to prosecutions under the Sherman
antitrust law.
Mr. Frear. The reason for presenting this record is this: K it
should turn out in the testimony, as suggested by many of the
witnesses in the Hughes hearings, and to a large extent by the Hughes
report, that Col. Deeds after he came into a position of authority
placed contracts with various interests in the city of Dayton, that he
concentrated the power so far as he could, or concentrated the
authority so far as it could be handled in the city of Dayton, would it
not indicate that he was following out his own previous ideas, ex-
pressed in the conditions found in the Patterson case, that he felt
that that was a right thing to do and something that should ha\ e
been anticipated by those who appointed him ? I am not criticizing
you, because I realize you knew nothing about it from your own
statement.
Secretary Baker. I know nothing about it, but if I were addressiner
my mind to that question I would ha\ o examined his record with
regard to his previous connection with the National Cash Rwrister
Co. and would have done everything to determine the military
quality of the man; and I would not ha^e felt free to have i-ut the
Government's confidence any more than I would have felt free to |)Ut
my own confidence into the hands of a man if I were not satisfied
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AVIATION. 53
of his military quality. But now, having discovered the fact that
Col. Deeds was engaged in that original transaction and coining now
to examine the things he did as a Government agent, I would ha\ e
examined them on their merits, and if I discovered that he was
dishonest I would have said so and prosecuted him. If I found he
was in error, I would examine whether the error was an innocent
error, whether it was one that should be expected to be made under
the circimistances, and find out whether the Government profited
or lost by his activity. I would not mix that with any prejudice
I might have obtainecl from the previous transaction.
Mr. Frear. And I suppose you would investigate to see how far
his conduct might be due to his temperament and disposition ?
Secretary Baker. If his temperament was disclosed in the origi-
nal transaction, I would look for traces of it in his subsequent actions.
Mr. Frear. And if that was true, the tendency on his part would
naturally be along those lines of concentration, of placing the power
so far as he coida in one locality among his friends; and that wa»
true to a large extent, was it not, according to the Hughes findings ?
Secretary Baker. Yes; I think it was. Of course that is open to
explanation on these grounds: Every one of us, when we get a big