Big Inch, Big Blunder?

As the week started, the twelve months’ deliberations over disposal of Big Inch and Little Big Inch seemed set tled. And not a day too soon. With the coal strike on (see NATIONAL AFFAIRS), hope was strong that the long idle Big and Little Inches might soon be carrying badly needed oil from Texas to the Eastern seaboard.

The War Assets Administration had kept its decision to itself. But it was an open secret in Washington that the most favored of the 16 bids had come from Big Inch Oil, Inc., headed by Charles Howard Smith, an old hand in the fuel business. WAA aides even gossiped that Smith’s company, which had offered $110,000,000, had been given the final okay by WAA Boss Robert M. Littlejohn.

So when the congressional committee probing surplus property called on Littlejohn to testify, he was expected to announce the sale, a nice feather in WAA’s badly battered hat. But what Boss Littlejohn told the committee flabbergasted everyone. Said he: all bids for the Inches were off because “I do not feel that any of them guarantees to the Government what I consider a fair price . . . $113,700,000.” Moreover, said he, the Army-Navy Petroleum Board had previously wanted the pipelines used for oil only. Now it would permit either oil or gas.

Fantastic Nonsense? To the bidders, this seemed like 1) nonsense and 2) the biggest of all WAA’s blunders. Snorted Oilman Smith: “Fantastic.” Actually, the Army-Navy board told WAA last month that it had no preference as to oil v. gas. And if WAA was going to permit the lines to be used for gas, then Littlejohn’s complaint that bids were too low made little sense. Many of the bidders would gladly have raised their bids considerably if WAA had told them they could pipe gas (gas securities are more readily marketed than oil securities). All along, they had offered to take the pipelines on either basis. ‘

One bidder, Dallas Gasman J. W. Crotty, who had bid $127,500,000, saw more than WAA blundering in all this. Well aware of the lobbying by railroads, coal operators and John L. Lewis’ own U.M.W. to prevent the lines from being used at all, Crotty charged that WAA had prevented conversion “for no cogent” but for some “sinister or political” reason.

Just before Littlejohn testified before the committee, he had had a conference with Attorney General Tom C. Clark. If Tom Clark had held up the sale with the idea of the Government operating the lines till the coal strike was over, he gave no hint. With all the lobbying going on, he might only have intended to toss the hot potato into the new Congress’ lap.

Oilman Smith estimated that he could clean out the lines in two weeks, have oil pouring out the Eastern outlets in another two weeks. Their emergency use for gas was out of the question. Reasons: compressor pumps would have to be installed all along some 1,500 miles of pipe, and feeder lines built—a year’s job. But, thanks to WAA’s latest bungle, there seemed small chance that the pipelines would be used for months, for anything.