ize our facilities must get under way-in most school systems on a wholesale scale-if we are to produce educational results which are efficient and meet modern needs.

Special educational services so splendidly developed within our schools in the past generation are now under threat because of the entire financial picture. The programs of guidance, health services, school-administered recreation, adult education, classes for the handicapped, and a host of others are vitally necessary. They must not be sacrificed. Yet so difficult has the situation become that at least one large American city-St. Louis, Mo.-has announced that it may during the coming year be forced to eliminate some of these services entirely.

To the credit of great numbers of communities, a concerted effort has been made to correct the most alarming of these problems, the teacher crisis. We come from a city which with the combined efforts of its citizens, its board of education, and its city administration, has just rewritten its salary schedule so that it is now the best in the United States. But at what cost? At the cost of a local tax rate which is far too high. While local tax collections are high, it may be able to meet this extra burden. Should a recession set in,-it may mean local financial chaos or educational retrenchment. It may mean both. We are sure, moreover, that wherever school systems have improved salaries the same condition holds true.

It is quite obvious that the entire question is one of providing the necessary funds. It seems almost nonsensical that the schools of the richest country in the history of the world are unable to do their finest work because of a lack of money.

School people, because of their correct desire to avoid Federal control of education, have by and large until recently veered away from a general program of Federal aid. They can, however, no longer stay away from Washington. Local and State taxation, now in most cases at a high point, can, as is being demonstrated in every part of the Nation, no longer exclusively meet the rising burden, no matter how sincere the effort may be.

This is the case in all States-the rich ones as well as the poor. For that reason, every State must receive substantial help. There is only one place from which that can come and that is the Federal Government. The great number of bills introduced in this Congress on the subject of such aid is a clear demonstration of the fact that many Senators and Representatives are in agreement with this concept.

There are many questions raised by the consideration of Federal aid bills. It is, however, our purpose to discuss with you mainly the problem of allocation of funds. In order to do so, certain basic principles must be stated first:

1. Real help must be given to maintain the education of the children of all States.

2. Special extra help must be granted those States which are relatively poorer in total amounts available for school purposes in order to help equalize educational opportunity throughout the Nation.

3. Funds allocated must serve to supplement budgets, especially in the direction of improving salaries to a point above an acceptable minimum national standard.

An evalution of the legislation now pending before the Congress on the subject of aid to schools will show that there are three approaches in all these bills. These include—

1. Bills which give across-the-board grants to every State in varying amounts either for general current expenses or for increase of teachers' salaries. These bills allocate funds either on the basis of number of pupils or numbers of teachers.

2. Bills which provide exclusively for equalization.

3. Bills which provide for equalization after guaranteeing that a standard minimum grant per child of school age will be received by every State.

We have examined all of these proposals very carefully. We find it difficult to support any across-the-board proposal even though very generous. We are convinced that at the present time in our history, so that every American child shall have at least an equal chance to enjoy a good minimum standard of education, money cannot be distributed in such a way that those who have too little will be granted less in order that those who are better off shall receive more. That would be the effect of any plan which makes equal grants on the basis of school populations.

At the same time, however, let us point out clearly that while we favor equalization, this cannot be the exclusive function of Federal aid. All education in America needs financial reenforcement. The fact that some need it more than others does not mean that those others need no help, whatsoever.

Some of the richest States have, during the past year, been going through all kinds of legislative and administrative acrobatics in order to adjust their program of educational finances properly and as yet have been only able to achieve very minimum successes in this direction. The Governor of our own State, New Jersey, found it necessary to announce a special session of the legislature to consider the question of school aid on the day after that legislature closed its regular session this year.

It is for this reason that we feel that we must speak on behalf of such legislation which will provide not only for equalization but also for a guaranteed minimum grant. Such an approach is taken by the Honorable Mr. McCowen, the chairman of this committee, in the bill introduced by him on April 3, 1947, bearing the number H. R. 2953.

We have prepared and appended to this statement a break-down by States of the effects of certain of the most prominent bills now pending. Under the proposed Senate bill 472 introduced by Mr. Taft, of Ohio, and its companion bill H. R. 1870, introduced by Mr. Battle, a great many States will receive no help of any kind from Federal sources. We estimate that under the provision of these bills about 19,000,000 of the Nation's almost 29,000,000 children between 5 and 17 years of agethat is almost 65 percent of the eligibles-will be provided with no Federal aid at all.

Certainly there is no question but that under the proposed formula the neediest States will be given alleviation. Yet it is difficult to see why if the principle that the Federal Government owes some responsibility for paying for some of the cost of the education of its children holds true, it will pay for some and forget about others.

Therefore, it would seem that that plan as proposed by Mr. McCowen would be much more desirable. Not only does it give special equalization payments but it also makes grants for the education of every child. This is the type of legislation we need.

However, it suffers from one difficulty. The amount granted as a minimum sum is not great enough. We feel that it is necessary to go beyond a token recognition of the problem. The needs are very great and only substantially larger allocations can begin to meet them.

We have proposed a plan which for purposes of identification we call the Newark plan. Instead of the $3 minimum grant we have proposed a $10 amount. As you see from the appended chart it would cost $331,000,000 which is approximately $198,000,000 more than the Taft plan, and $141,000,000 more than the McCowen formulation. It would, however, give all States amounts sizable enough to make a real difference in their present ability to shoulder their educational difficulties. We do not think that $3 is enough. Nor do we think that $10 is enough. We believe that both the equalization formula and the proposed minimum must both ultimately be raised to higher points. We consider this program a beginning point. The income of our local, State, and Federal Governments all come from the same pocket, that of the American people, and we would thus believe that when special treatment of finances is needed it should come from the source most able at a particular time to give it. That source in our present fiscal organization of this country is the Federal Government. For that reason we call upon it to do its share.

There is another consideration in judging the program of allocation of Federal aid moneys which we of New Jersey are particularly concerned with.

Our State, New Jersey, as well as Florida, Illinois, Indiana, Ohio, Maine, Michigan, Nebraska, Nevada, Texas, Washington, Wyoming, and in part Connecticut, Rhode Island, and Pennsylvania, do not have State income taxes. As a result we pay a higher proportionate share of taxes to the Federal Treasury. The States above listed would, under the exclusive equalization plan, be eliminated from receiving any grants. We are thus in a peculiar position. If we had a State income tax we would have more local revenue for schools. Since we do not, we pay more money to the Federal Government. Under the exclusive equalization plan we get nothing. Yet we have paid into the Federal Treasury a higher proportional percentage than other States. In return for the privilege of having less money for our State needs we are penalized by paying more Federal taxes. Certainly we become doubly injured when we also receive no Federal aid for schools.

If, however, the McCowen principle is accepted-and we hope that some consideration will be given to our suggested amendment of itto some extent, at least for those States, some degree of relief from the above-described condition will be had. Certainly those States which pay most should not penalized.

We know that your committee will hear many reasons for Federal aid. Be assured that no one understands the whole situation better than we as teachers. The teachers of our city are concerned not so much with themselves as with their schools, pupils, and the education of American children generally. For that reason they have sent us here hoping that the work of your committee will result in an action. which will strengthen our schools and with it our democracy.

This statement is submitted for the Emergency Council of Newark Teacher Organizations by Neil Flanagan, Edward J. Serven, and Benjamin Epstein.

Mr. McCowEN. We thank you, Mr. Epstein. I am sure the committee appreciates your statement. In view of the fact that we have only half the time the committee usually has, that is, from 10 to 12, the Chair would like to limit the time of each member of the subcommittee in questioning to 3 minutes, this morning, so that we can get through this entire program by 12 o'clock.

Mr. GWINN. Mr. Epstein, I was simply amazed, as you read along there, to wonder at where it is you think this money is coming from, when you say there is no place to get it except Washington. Do you know where Washington is getting any money except it gets it from New Jersey and other States?

Mr. EPSTEIN. With that I am in agreement, sir, but as the situation now stands, the Federal Government has taken upon itself the largest taxing power that we have had in previous history, with the result that it has limited the power of many States to certain sources of revenue. I believe that our Governor was here arguing that point in Washington some weeks ago. As a result, our tax base has become narrower and narrower, with the consequent fact that we come to that place where the tax base has, as a result, become broader and broader, to solicit those funds.

Mr. GWINN. In effect, then, what you say is that you petition the great central government somewhat like they did in the old Hebrew times: "Oh, God-state, you have taken so much money away from us, we cannot support our own schools. Please send some of it back to us.' Is that what you mean?

Mr. EPSTEIN. That is fairly well put as to what I mean.
Mr. GWINN. Thank you very much.

Mr. OWENS. Mr. Epstein, this question, as you put it, bothers me considerably, because at the present time we are considering on the floor a measure to give $350,000,000 to aid certain nations in Europe and Asia. We have not been advised yet just what nations we are going to aid, or how much we are going to give them. We are more or less supposed to guess at that. We are told also that next week we will be asked to give $400,000,000 to Greece and Turkey. Those amounts are the start of a group which former President Hoover estimated during the coming 2-year period will amount to $1,500,000,000.

I challenged yesterday, or I inquired yesterday, rather, under what constitutional authority we are acting. I think probably you will be able to answer it. I ask you, under what constitutional authority you feel we should act in this case.

Mr. EPSTEIN. I am not a lawyer; I am a teacher of science, so you will find me perhaps making an error on this. I would say that the Federal Government has already, in its vocational aid and in its school-lunch program, been giving grants to the States, and I have heard of no constitutional question being raised. Therefore, I would assume that there is no constitutional difficulty. Under what exact title, I am not prepared to say.

Mr. OWENS. It will probably have to be under our general welfare clause.

Mr. EPSTEIN. That is right.

Mr. OWENS. And the general welfare of our children who need education certainly could easily be classed as general welfare, probably more easily than trying to figure out how $300,000,000 or $400,000,000 would be for general welfare, would you say?

Mr. EPSTEIN. I should imagine that the protection of the educational rights of American children would be constitutionally more acceptable than the protection of rights of other nations. So it would

seem to me.

Mr. OWENS. Then you would say, or you would be willing to back up the argument of a Congressman to the effect that if we are short of money, and there is any choice of where it should go, this money should be utilized first for our own Nation and the education of our children and for the payment of our teachers, before we send it over to other nations?

Mr. EPSTEIN. I would have to be convinced that there is not enough money for both purposes.

Mr. OWENS. Well, we have a debt, as I understand it, of $260,000,000,000, on which interest is being paid every year, and we have only so much money to get along with. We have decided this year we will have to do it on $31,500,000,000.

Mr. EPSTEIN. I can show you my income-tax returns, to show you it has not dropped enough yet so that the amount the Federal Government is taking from our every-day earnings is so small that it should. not be able to pay for sizable needs.

Mr. McCowEN. I am sorry, but the gentleman's time has expired. Mr. KEARNS. I am very much interested in your statement that Newark schools have top salary schedules. I like to hear that, because I think that is where education should begin to develop interest; that is, in the particular locality, and have the people in the community so interested that they have the best system. I want to congratulate you on having that kind of a system.

What is the elementary rate for teachers?

Mr. EPSTEIN. We have several schedules in Newark which provide now for a beginning salary of $2,600–

Mr. KEARNS. That is the elementary?

Mr. EPSTEIN. We have a single salary schedule for elementary and high school-which provides for a maximum of $5,400. That is done in a series of 16 steps, of which 2 will be eliminated in the event advanced degrees are received.

Mr. KEARNS. Is that through a merit system whereby the superintendent or an evaluating committee evaluates the teachers?

Mr. EPSTEIN. That requires nothing except satisfactory teaching, as determined by the supervisor of the particular school.

Mr. KEARNS. You have a tenure law?

Mr. EPSTEIN. We have a State tenure law.

Mr. KEARNS. What is the tax millage rate?

Mr. EPSTEIN. If I may turn around and ask the attorney for the board of education. What is it, Mr. Fox?

Mr. Fox. It is 5.97.