Mr. REUSS. Fine. I think I have your position on that. Just one more question. I thought you pointed out very ably in your statement the overlapping by the 25 Federal agencies and pointed out how desirable a consolidation or reorganization would be in terms of doing a better Federal job. Is that correct? Mr. WATERHOUSE. I think so. Mr. REUSS. You did point it out, and your statement makes the point. But I read the Hoover Commission recommendations and I cannot find any plan or program for reorganizing and consolidating and otherwise making more efficient those diverse agencies. Mr. WATERHOUSE. It was my thought in connection with that if an overall water policy were developed, that would follow as a matter of course. Naturally the problems involved would merge because of the adoption of the direct policy. Mr. REUSS. Not just as easily as that. Somebody would have to apply his brain to the problem and sit there with charts and tables of organization and terms of reference, and so on, and work out a tidy solution to this problem of conflicting agencies, would he not? Mr. WATERHOUSE. Yes. That is right. Mr. REUSS. And the Hoover Commission has not done that. Mr. WATERHOUSE. I do not say that they have done it. No. I think if you have an overall water policy as recommended, I say that will come about. I do not think it will come about like that overnight. Mr. REUSS. Somebody has to Mr. WATERHOUSE. Work it out. Mr. REUSS. And the Hoover Commission has not done so. So to that extent we are not helped much by the Hoover Commission in this particular field of consolidation and reorganization. Mr. WATERHOUSE. They have not outlined a complete plan of consolidation, and so forth. No. I think you have to have your policy first to see what you are going to do in connection with it, and they have not done that, of course. Mr. REUSS. Thank you. Mr. JONES. Thank you very much, Mr. Waterhouse. We are glad to have you. Our next witness is Mr. R. P. Stacy, chairman of the New England Council. All right, Mr. Stacy. STATEMENT OF ROBERT P. STACY, DIRECTOR, NEW ENGLAND COUNCIL AND THE CONNECTICUT CHAMBER Mr. STACY. Mr. Chairman, I am Robert P. Stacy, a director of the New England Council and the Connecticut Chamber. I am making this statement on behalf of the New England Council. The New England Council is a regional economic development agency. It is nonprofit and nongovernmental, financed by more than 3,000 members. Its relations with Government agencies-both State and Federal-are fairly close. The council integrates the development work of the business community, State, and local government agencies, the New England gov ernor's conference, interstate official conference groups, and the New England congressional delegation, to some extent. The council itself is an example of the kind of nonpartisan teamwork which is operating in many fields in New England. We believe that private-State-Federal teamwork is a sound pattern for floodcontrol programs. Council members believe in planning public projects by seeing first how much of the project can be accomplished best by private citizens or private business enterprise; next, if necessary, by maximum use of local government agencies to supplement private enterprise; then, by turning to State agencies to meet the broader problems not confined to local government jurisdiction nor capable of being met with local resources. On matters of still broader interest, New Englanders have developed interstate compacts to further regional projects. Only after these steps have been taken and after the maximum use has been made of local, State, and regional resources to meet problems do we favor asking the Federal Government for assistance. * Our understanding of the purpose of the Hoover Commission is that it was authorized to review public policy from the same viewpoint. The policy of Congress set forth in Public Law 108 which created the Commission repeatedly uses such phrases as "reducing expenditures," "eliminating duplication," "consolidating services," "abolishing ** functions unnecessary to efficient conduct of government"and most important of all-"eliminating nonessential services, functions, and activities which are competitive with private enterprise." Members of the New England Council believe these are worthy objectives and that all possible efforts should be made to accomplish them. We believe, furthermore, that the Hoover Commission's recommendations, if adopted, would further these laudable purposes. Therefore, we support the recommendations of that Commission. This approach to flood problems does not preclude the use of Federal funds. In fact, the Commission's report to the Congress specifically recommends That the Federal Government should assume responsibility when participation or initiative is necessary to further or safeguard the national interest or to accomplish broad national objectives, where projects, because of size or complexity or potential multiple purposes or benefits, are beyond the means or the needs of local or private enterprise. We endorse that recommendation. We believe that Federal participation is needed to solve New England's present flood problems and we are in support of the program presented to the President of the United States and the Congress by the New England governors' conference. We do not believe that recourse to any such devices as a Federal river valley authority or other imposition of Federal control over New England's natural resources is required to carry out this program. As Laurence F. Whittemore, a former president of the New England Council, once said: The more we study New England's economy, the more we are impressed with the fact that it has forged ahead despite a long history of Federal aid to other sections of the country. Our part of the country grew up and reached a high state of industrial development during that period of the Nation's history before Federal aid became fashionable and before the means to finance it-primarily the corporate and personal income tax-were available. We built our railroads without Federal grants, developed our water power with private capital, and our economy in each separate situation rose and fell under the free exercise of competition based on the laws of supply and demand. In progressive social legislation and in our treatment of labor we led the Nation, sometimes at the expense of our own pocketbooks. Partly because of a tradition of self-reliance and partly because we had already attained a high state of industrial development, we have not in recent years led the raids upon the Federal Treasury for aids and subsidies of every type and description. On the subject of flood control, which we understand is the issue upon which the call for this hearing was based, the New England Council already has placed itself on record with the Commission on Organization of the Executive Branch of the Government. hearing in New York City, June 14, 1954, the council said: An ideal flood-protection system for New England requires a combination of large and small dams on the region's principal rivers and their tributaries. Past developments have been in that direction, and the New England Council believes future installations should continue the same pattern. Under the Flood Control Act of 1944, the United States Army engineers have made a good start on flood-control work in New England. In addition to the Federal activities and in connection with their flood-control program, the legislatures and governors of the four New England States in the Connecticut River Basin have ratified an interstate flood-control compact which Congress approved in June 1953. Primarily the purpose is to formulate the means of reimbursing the States of Vermont and New Hampshire for their losses resulting from the taking of land for flood-control measures which benefit other States. Since most flood-control projects are financed largely by the Federal Government, their costs are distributed by taxation over the entire country. Those persons located in areas subject to overflow pay through taxation but a small portion of the bill for their own protection. Those who live in areas free from floods help pay for the protection of others. This is desirable, if the determination of needed projects employs accurate and reasonable criteria of costs and benefits and if the criteria are applied uniformly in all parts of the country. New England and its people should lend their continuing support to the design and construction of an adequate and fairly conceived flood-control program on a national scale. The standards of evaluating proposed projects are of particular importance. In its sharing of the costs through taxation and the benefits through new construction, the region should exercise the same restraint and objectivity that it desires in other parts of the country. The most important flood problem in New England is the protection of life and property. If shortages of water were foreseeable, extreme measures combining flood control and conservation might be justified. But at the present time a continuation of the compromise method followed in the past is clearly indicated. The interstate compact seems to us of the council to be the proper vehicle for giving full recognition to these problems, and it provides a most generally satisfactory basis for selection of sites, with equitable allocation of costs in proportion of benefits. We still are of the opinion expressed at that time. To this should be added the observation that interstate compacts also provide an excellent vehicle for regional cooperation with Federal Government agencies. And finally, we hope that the members of this subcommittee will lend their support to the congressional action which will be required to carry out the New England flood-control program recommended by the New England Governors' Conference. Mr. JONES. Mr. Stacy, on page 3 you quote Mr. Laurence F. Whittemore, a former president of the New England Council. Does the New England Council subscribe to the statement made by Mr. Whittemore? Mr. STACY. Yes, sir. In this particular statement. Mr. JONES. And do you believe that Mr. Whittemore's statement is factually correct? Mr. STACY. I think so. Mr. JONES. Do you agree with his statement where he says: "We built our railroads without Federal grants * * *"? Mr. STACY. I assume he was referring to the railroads of New England. Mr. JONES. The railroads of New England? Mr. STACY. Yes, sir. Mr. JONES. Do you know of any railroads in New England that were built that were not the beneficiaries of Federal assistance? Mr. STACY. I am not personally very familiar with how our railroads were built. That is Mr. Whittemore's statement. Mr. JONES. My recollection was that in 1946 the railroads of this country owned $1,600 million worth of land that was given to them in land grants by the Federal Government. Mr. STACY. That could be true. I do not know personally. Mr. JONES. And he makes no confinement of that to the railroads of New England. He says, "We built our railroads without Federal funds." I assume he must have one particular railroad in mind. Do you think that accounts for that statement? Mr. STACY. He was president of the New Haven Railroad. Mr. JONES. It may be as to the New Haven. I do not know about that, but I am surprised that any study of the subject would fail to reveal that the railroads have not done pretty well by Federal assistance. With the advent of the railroads about 1830 the Federal Government ceased navigation projects and appropriated most of the money for aid and assistance in the construction of railroads in every part of the country. What flood-control projects has the New England Council accomplished so far, Mr. Stacy? Mr. STACY. I do not think that the New England Council has accomplished any flood-control projects. There have been some built in New England, of course. Mr. JONES. Have there been any built under the interstate compact? Mr. STACY. There have been, and I think that will be disclosed to you a little later by Mr. Shuttler and some others. There have been several flood-control dams built, and there have been others authorized that have not been built. Mr. JONES. Were those built with Federal funds, or funds supplied by the member States of the compact? Mr. STACY. Mostly Federal funds, as I understand it. Mr. JONES. Are you apprehensive that the Corps of Engineers could not undertake the flood-control responsibilities and coordinate the efforts of the various States in obtaining maximum development of the construction of those dams for flood control? Mr. STACY. I have personally a very high regard for the Corps of Engineers, as I have known them in New England. If you are referring to local Mr. JONES. I gather from your testimony you are advocating that this flood-control work be deferred until this council, through the Interstate compact, can work out plans and specifications for a comprehensive development of the various basins involved in the flood area. Is that correct, sir? Mr. STACY. The particular dams in question, of course, were to be located in New Hampshire and Vermont. The four-State compact was intended to reimburse them for their tax loss to an extent by the downstate beneficiaries. Mr. JONES. Do you think that the Federal Government should construct multiple-purpose dams for the hydro potential of the stream? Mr. STACY. Well, I think we would have to define what stream. I am not familiar with all of the streams. I am somewhat familiar with the Connecticut River. Mr. JONES. Let us take the Connecticut River then. Mr. STACY. I do not know of any instance where a multiple-purpose project has been erected by the Corps of Engineers. Mr. JONES. On the entire mainstem of the Connecticut River? Mr. STACY. There have been some submitted. I have in mind one project in Connecticut for Enfield Rapids. It was and it has been proposed over a period of years as a navigation and power project. No flood control was involved, since it is a very low head dam. Incidentally, it could not be much higher unless you want to flood out cities like Springfield or Holyoke or other communities. So that at least is one navigation and power project proposed by the Corps of Engineers, but it has not been developed on that basis. The application, I understand, is now before the Federal Power Commission to develop it as a power project, with future provision for navigation. Mr. JONES. That is an application for a license from the Connecticut Power Co. now pending before the Federal Power Commission? Mr. STACY. Yes, sir. That is my understanding. Mr. JONES. Do you believe that the adoption of the Hoover Commission's recommendations would reduce expenditures? Mr. STACY. Would reduce expenditures? Mr. JONES. Yes. Mr. STACY. I do, definitely. Yes, sir. I have great confidence in the makeup and character of that Commission and its nonpartisan approach to the problem-not only this Commission, but the first Commission. Mr. JONES. I see you have given a great deal of attention to the recommendations made by the Hoover Commission. Would you like to point out in what fields you think a reduction would be made in expenditures by the Federal Government through the Hoover Commission's recommendations? Mr. STACY. I assume you are talking about natural resources and power? Mr. JONES. Yes, sir. Confine it entirely to the report on water resources. Mr. STACY. I could point out some very outstanding phases in other fields, but confining ourselves to water resources and power, I think there can be substantial reductions made especially in the power phase of this problem. Mr. JONES. How would that be accomplished, Mr. Stacy? Mr. STACY. By not building them. By the Federal Government not building them, of course, and by private enterprise being permitted to build them. |