"Not Proved Adequate"

The Navy moved in on Brewster Aeronautical Corp. last week, seized Brewster's two plants in Long Island City (where it manufactures dive-bomber parts), its big, new, final assembly plant in Johnsville, Pa. (where it is supposed to be zipping out finished planes) and its plant at Newark Airport (where it makes wingtip floats and other gear for Consolidated Catalina Flying Boats). Brewster was the fifth U.S. firm to be seized by the Government since war began in Europe.*

The others had all been taken over in the midst of their labor wrangles, but in this case there was no strike.

Washington threw no light at all on the seizure. Said the White House: "Dissatisfaction with the management." Said the Navy, in a controlled tone: "The corporation holds contracts for combat-type aircraft, the orderly and regular delivery of which is essential to the war effort. The existing private control. . . has not proved adequate."

Apparently Navy's airplane-production staff, headed by onetime General Motors Man James D. Mooney, had made up its mind that Brewster needed a strong hand. From inside the plants came an account of the "inadequacy": that the FBI had found several dozen saboteurs working for Brewster (in the morning big swastika-shaped holes were sometimes found punched in plane wings); that when the company attempted to fire suspected men, the union intervened; that the Navy stepped in to end sabotage. From the plants also came rumors that confusion, inefficiency and mismanagement had delayed production. From aircraft circles came gossip: Brewster officials had bitten off more than they could chew. From James Work, chairman of the Brewster Board, who has seen his company mushroom from a little subcontractor into a big prime contractor with over $100,000,000 worth of orders, came only silence.

But a satisfied smile wreathed the jowls of chunky, brick-solid little Congressman Albert Engel of Muskegon, Mich., a passionate and indefatigable private investigator whose only other hobby is bricklaying. In the smile was a hint of what Engel believed: at least part of the trouble at Brewster was what happens when a few greedy men get their hooks in a company.

Not so long ago Congressman Engel arose in the House, piled brick upon brick of accusation against Felix William Zelcer, onetime vice president of Seversky Aircraft Corp., before that proprietor of the White Horse Tavern in Manhattan; and the suave Miranda Bros.--Alfred Joseph Jr., and Ignacio Joseph. Congressman Engel's story:

Mexican-born, merchants for bombs, grenades, guns, other lethal wares of war, the Miranda Bros, were jailed in 1940 for selling munitions destined for Bolivia in violation of an arms embargo in the Gran Chaco War. Never idle, even in jail, the Mirandas arranged to handle sales for the Hayes Manufacturing Co. (airplane parts) of Grand Rapids, Mich. They got Hayes an order for parts from Brewster Aeronautical Corp. Their own commission was 5%. Out of jail, they joined Partner Zelcer in their Manhattan office, and arranged with Brewster to handle the sale abroad of its Buffalo fighters. They operated as the "Brewster Export Corp.," charged up to 12 1/2% commission, and were in a position to collect on sales of parts to Brewster and sales of Brewster planes abroad. They stood to make hundreds of thousands of dollars before war's end. They also bought into Hayes and Brewster, acquiring some 10% of the stock of each.

Mr. Engel wanted to know what service the Mirandas & Zelcer could render to justify the payment of such commissions, which must ultimately be added to the taxpayers' bill for the war.

Stockholders grew curious, too. One of them sued the directors and officers of Brewster, charging that the Mirandas dominated Brewster and got "excessive commissions." Congressman Engel asked the Vinson Naval Affairs Committee to investigate. But the Navy, also impatient, moved in first.

No one said that the Miranda setup had anything to do with the Navy's seizure. But chunky Mr. Engel, who loves to lay bricks, knows that bricks that are piled carelessly atop one another will finally collapse. Around Washington this week ran the rumor that Brewster, first plant to be seized for other than labor troubles, might not be the last. The military had a cold eye on other plants where bricks were piled too high.

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