Senator MORSE. The Senator from Colorado?

Senator DOMINICK. Mr. Carstenson, is the Senator from West Virginia trying to say that the rural areas are more illiterate than the urban areas of our country? That certainly isn't true in our section of the country.

Senator RANDOLPH. I will say to the Senator from Colorado that I didn't say that. I never used that word. I used the word "isolation." Senator DOMINICK. I might say in that connection just for the record that as far as our area is concerned that the people in the rural areas are much more conscious of our overall world problems, talking about isolation in terms of foreign problems, than are many of the people in the urban areas. So this shifts from area to area, obviously.

Senator MORSE. I think he meant isolated in cultural development and education.

Mr. CARSTENSON. Access to educational programs. The figures that we developed when I was in the U.S. Office of Education, in the Adult Education Section, did show that the rural areas had a higher level of illiteracy by any standard. Most of this was concentrated in the South. It was not out in the rural areas in the Midwest and in the Rocky Mountain States.

Senator DOMINICK. As long as you exclude the headquarters of our own organization, I am happy.

Mr. CARSTENSON. I would have to concede that in my judgment some of the roughest problems are in the metropolitan areas. I would certainly think that some of these have been neglected for a long time and need a rather high priority. But it shouldn't be, to the exclusion of the small town particularly, or small city.

TITLE I-ELIMINATION OF "LAUNDRY LIST"

In title I, I also suggest that as in the House version, it might be better to leave out the laundry list of different problem areas. This current list is appropriate for these times, but as times do change the list would change. I would suggest that the laundry list is not perhaps the best thing to put into the bill under title I.

I feel that the State plan which is envisioned in this plan, while more complex than most plans, is a very good one. I feel that it will generate the involvement of the various institutions and groups within the State to develop a good State plan. Some of the State plan proposals have been very limited. The State plan proposal in this bill will involve all the State institutions in the program. The bill should indicate that the State committees should include the citizenry as well as the representatives of the various institutions.

I am glad that the committee is thinking about an increase in the total bill, because I certainly feel that the $25 million invisaged in S. 600 is inadequate, especially when you start dealing with educational TV and radio under title I.

If the $25 million amount were left in title I, I think we would end up with a lot of one-man programs in States where you have a number of small universities. Our experience seems to indicate that a team with a couple of professors and a couple of graduate assistants seems to be the best method of really doing the kind of job that needs to be done to really reach out and help these communities.

We recommend doubling the amount of $50 million for that section. This would give a large enough amount within a single State to make an impact. The Ford Foundation in their evaluation showed that in the big States it takes a lot of money and a big demonstration program to really have an impact on an entire State. I would hope that you would see fit to increase the amount for title I.

RESEARCH SUPPORT

We do like the idea of the 20 percent for experimental. This would be particularly valuable in the areas of educational TV where you are studying more than one State or cooperative arrangements on these kind of programs which go over more than one area.

My main comment concerning the need for financing in university extension is that the physical presence of large numbers of students and the youth orientation of both the faculty and the board pretty much precludes giving high priority to university extension work by the colleges. I doubt if cooperative extension would have ever developed had the land-grant colleges, had not Congress acted and provided funds setting this area up as a high priority area. This is the same situation. It does take a high priority emphasis by Congress to push this program ahead.

TITLE I-MATCHING FORMULA AND ADVISORY COMMITTEE COMMENTS

We also feel that the matching formula, as outlined in S. 600, shifts too quickly to State and local support. Usually it takes about 2 years for the program to get underway and for the legislatures to have a chance to evaluate the program. We feel that having a 90-10 matching for 1 year and shifting to a lower ratio the second year would be shifting it too fast. We would recommend 90-10 for the first 2 years, and then shifting to two-thirds to one-third ratio.

We also recommend that the advisory committee be changed to an interdepartmental committee and be given a specific task. I think that too many of the advisory committees that we have are not given the proper tasks or made proper use of. We recommend that this interdepartmental committee would be given the task of coming up with suggested program priority list of community problems. These would be gleaned from the experience of the various agencies and bureaus as to what States and communities need. These recommendations should be in turn sent to the States and universities for their consideration in preparing the State plans.

We recommend that the proposed review committee be made a more permanent operation meeting more frequently to review, evaluate, and go over the program and make recommendations to Congress and the administration.

I think that Congress will be doing more to help local communities to solve their own problems and to restore local initiative through this proposed program than anything that will be done in the Congress in the next few years in all the legislation pending before the Congress. I appreciate this opportunity to testify. If you have any other questions, I will be glad to answer them.

Senator MORSE. Thank you very much.
The Senator from West Virginia.

Senator RANDOLPH. I don't believe, Mr. Chairman, that I have any questions. I have read the statement of the witness, and I have heard the comment on the earlier part of it.

I will close my comments on this statement by saying that in nowise would I want to indicate there is any particular area of the country where a deficiency exists that we want to highlight. We know the facts. We know where these areas of the country are at the present time. I just believe that the chairman of the subcommitee and all of us on the subcommittee are intensely interested in moving into all of the areas, be it urban or be it rural, where the problems exist. And I think that in the legislation we are now considering, we at least have a partial answer, and to a degree the appropriate tools to make an impact.

And I congratulate you on helping us to arrive at considerate conclusions.

Senator MORSE. Senator Dominick?

Senator DOMINICK. Mr. Chairman the witness has a statement in which he kicks the banks around in pretty good shape. I realize that in a prepared statement of this kind that one tends to use phrases which are designed to dramatize an issue.

I would like to ask you this. You are talking about direct loans and not insurance and private loans. But for each dollar of reinsurance or insurance which is granted to a private loan you get $12.50 worth of funds. And this has been true all the way through. So if we go to the direct loan basis, in order to accomplish the same amount of aid to the students you have got to spend 121/2 times as much money out of the Federal Treasury as you otherwise would. Are you in favor of doing that?

INTEREST COST TO STUDENT

Mr. CARSTENSON. I look at it from the point of view of the individual student. If the difference can mean $1,000 or $2,000 over the course of the loan, I am afraid that I would have to side with the individual student, and say that the higher interest rate is a pretty high price to pay. I think that the country is wealthy enough to make this kind of loan. I do not concur in the idea that this kind of loan should be carried in the general budget. These are not budget expenditures; I think calling them expenditures is just as fallacious here as they are in the housing. These loans shouldn't be a part of the regular budget and shouldn't be conceived of in the same way as direct appropriations

are.

Senator DOMINICK. How do you conceive of them, just forget them? Mr. CARSTENSON. No, you conceive of them as you would in business. These are investments that the Government has made, and they are not expenditures. No business would treat them as expenditures. They would not count any loan that they make as an expenditure. They would still list it as an asset. I think this is true here as it is in the area of housing.

Senator DOMINICK. Have you had the opportunity of reading the testimony on the National Defense Education Act loans of today? Mr. CARSTENSON. No; I have not.

Senator DOMINICK. Mr. Carstenson, I have had a letter

Senator MORSE. May I interrupt a second, I am going to ask counsel to supply the witness a copy of Mr. Muirhead's testimony and the other testimony, and if he wants to file a supplemental statement he may do so.

Senator DOMINICK. I think that would help. Thank you.

You refer to the laundry list, which is another nice phrase. I have a letter from some of the educational people who say to me that you shouldn't eliminate the so-called list of areas concerned, but that you should expand them and be more specific on some of the cultural courses or the bachelor-of-arts type of course that can be taken under these extension courses. Do you have any comment on that type of activity?

Mr. CARSTENSON. Yes. I think it is very hard in any laundry list to come up with the entire range and be specific enough. This is the same problem the House committee has had. They wanted to be more specific and they found that they just couldn't. For this reason, I think that it is well to put this list in the report. I think you really need to have built into the law this review council which will continually check and make sure that these programs are going in the right direction to meet current needs.

For example, one of the problems

Senator DOMINICK. You do want to have some control over the extension services, then; you just don't want Congress to write it into the law.

Mr. CARSTENSON. I think that the committee ought to put it in the report form, and ought to keep track of this, and keep tabs on this, via a review council which will review and report directly to Congress so that you do have control over the direction, so that you don't get the kind of fluff courses and other things developing in such a program, and that they would really be geared to the community problems. Problems do emerge and change over all the time. I just give you a specific instance that occurred just yesterday, when I was meeting with the National Housing Conference Board of which I am a member.

EXTENSION TRAINING IN HOUSING ADMINISTRATION

We were talking with Mr. Lash, the director of Action. And he said that there was a terrific need right at this particular time for the universities to start doing some training-to help nonprofit housing, specifically to train nonprofit housing administrators. There was a real shortage now, and with Congress probably appropriating more money for the development of nonprofit housing, it becomes critical to train more this kind of person. They were asking, is there any way that we can train people to go work nonprofit housing projects under these various Federal programs.

If the university extension program as envisaged in title I were to pass, I think it would be possible. A laundry list fixed into law might make it impossible to train people in that area.

There are many different examples of where a desperate training need might exist to help the community solve its problem. These needs may arise very rapidly. I wouldn't like to see this list written into a law, but rather have Congress keep in control by a review committee that will report regularly to it.

Senator DOMINICK. I would say that your example is an interesting But I think it is pretty well covered by the list of examples under

103.

But I won't argue that, because that is a matter of semantics, and it may be your interpretation.

I was also interested in your statement on page seven in which you say in the second paragraph:

Physical presence of young students in such large numbers and the higher academic standing of the regular credit on-campus courses have put service to the communities in the State at a low priority by most youth-oriented boards of trustees and administrators.

Are you saying in general there that, because the people are young, they don't give a hoot about the communities?

Mr. CARSTENSON. No. Having gone through a school of education, I say that because most administrators, are primarily oriented toward youth by their training and background and everything else. The physical presence of students plus the background and training of administrators in universities tends to reinforce their primary concerns about the student body on hand, the youth. At the same time it is also true that people who are attracted to the boards of universities and colleges are youth oriented. They primarily think of the student, the young student, and quite often forget that a university has a job of serving all in the State.

These views are based on my experience in working in universities and various different colleges. The youth orientation is there. And I repeat that I don't think that most land-grant colleges would have ever developed cooperative extension had not the Congress put a priority on it. This is why I again urge that Congress, as it did in the case of the cooperative extension, put a priority on service by the university to the entire State.

Senator DOMINICK. Thank you.

Senator MORSE. Thank you very much.

I am going to call out of order our next witness, because he has a short statement, and I want to hear as many witnesses as possible before 11 o'clock, when the full committee meets. So I will call Mr. Hicks, executive secretary of the Liberty Lobby, to testify now. We are delighted to have you with us, Mr. Hicks. And you may proceed in your own way.

STATEMENT OF W. B. HICKS, JR., EXECUTIVE SECRETARY,

LIBERTY LOBBY, WASHINGTON, D.C.

Mr. HICKS. Mr. Chairman and members of the subcommittee, I am W. B. Hicks, Jr., executive secretary of Liberty Lobby. I appear on behalf of the 147,000 subscribers to our legislative reports to oppose the Higher Education Act of 1965.

Because we realize that Federal taxation, and the strain it places on the economy is a basic cause of State and local reluctance to spend more money on education, Liberty Lobby would not oppose any reasonable effort to release Federal tax money for that purpose, even though the sensible thing to do would be to leave the money in the taxpayers' hands in the first place, and depend on their good judgment as to its allocation.