It was when we came to prices for engines that we ran into trouble. After Jack Homer had discussed the problem with BUAERO as to details, J. F. McCarthy and I went to Washington to face the issues with Comdr. L. B. Richardson, then in charge of Procurement. This was not the Captain Dick Richardson of the big-boat formula fame, but a younger Dick with whom I had flown in the service. He knew his business and had positive ideas based on wide experience. On contracts calling for such large volume, the Bureau would expect a far lower price than any we had quoted—and in principle it was right. Our problem was that, pending expansion of the shop, the training of new operators, the testing of tools, and all the other problems of getting into production, we would run into high costs. That had been our experience during the expansion periods with the French and British contracts and now with the likelihood that we would lose even some of our key men to the armed forces, we could expect spoiled work and scrap to skyrocket costs. No one could guess when costs could be brought into line, and it seemed almost impossible to arrive at a price agreeable to both sides. And this problem of price might have delayed negotiations interminably had we not taken an important decision to break the deadlock. This decision was based on long experience in business for government account and on a background of events that have been herein related. It dated back to that provision in the Air Corps Act of 1926, in which we granted the government the right to keep cost inspectors in our plant. To break the impasse we now proposed that if BUAERO would establish fixed prices on our contracts on the basis of our earlier experience, we would undertake voluntarily to reduce future invoice prices on products yet to be shipped, to the end that we would never accumulate any excessive profit. In other words, since neither we nor the Bureau could stand any future criticism on profits, we would voluntarily renegotiate ourselves to avoid excessive profit. The Bureau’s resident cost inspectors, with access to all our books, would furnish the data on which the Bureau could judge the reasonableness of our performance, and we would abide by their judgment.