Mr. FLOOD. Can it be somebody in the White House reads my notes? Secretary RICHARDSON. I should think it might be more nearly an instance of great minds traveling along parallel lines.

Mr. FLOOD. But adequacy of budget for health programs still come back to the fact that, in total, you do not have even a cost of living increase for the health programs.

Secretary RICHARDSON. I think that, generally speaking, most of the programs we do but in some of them there are cuts, which you see reflected in this total that you have been referring to. There is a minus 49 for regional medical programs.

Mr. FLOOD. Who in the world thought that up?

Secretary RICHARDSON. But it will allow approximately the same level of operation. In medical facilities construction where we are substituting subsidized guaranteed loans

Mr. FLOOD. You make me very unhappy with that cut in the regional medical programs.

Secretary RICHARDSON. I for one, Mr. Chairman

Mr. FLOOD. That is flying in the face of the gods.

Secretary RICHARDSON. We only propose and the Congress disposes. I must say I for one began to try to understand what that program was about when it was still called the heart, cancer, stroke program, as a brainchild of Dr. DeBakey. It was unintelligible then, and the successive transmutations and metamorphoses which it has experienced in the meantime have hardly made it any more intelligible. Mr. FLOOD. Then we are at diametric opposites early in the morning.

Secretary RICHARDSON. I would like to see the program related to the President's new proposal for area health education centers, which could serve a genuinely meaningful role in continuing education of doctors.

Mr. FLOOD. I guessed that myself when I heard about it.

Secretary RICHARDSON. I think there could be a fruitful marriage between the continuing education component of regional medical programs and the President's new program which, as you know, is based essentially on recommendations that the Carnegie Commission made. Other aspects of it

Mr. FLOOD. I mentioned the Carnegie Commission yesterday to your Commissioner of Education and he was not very happy with what they said about the status of our educational system in this country. He has been in it a while.

Secretary RICHARDSON. They made a very great many pronouncements but one of their most valuable is the

Mr. FLOOD. That is the one you like?

Secretary RICHARDSON. We like that one.
Mr. FLOOD. Very human.

$100 MILLION CANCER PROGRAM

Mr. CARDWELL. Mr. Chairman, before we leave that subject may I make two points?

One, I would like to drive home the second point about the $30 million versus the $100 million. It is very important that we clear this up. There have been some statements in the press that are abso

lutely incorrect. The $100 million represents the appropriation level requested of Congress. It represents the level at which we would make grants.

Mr. FLOOD. You are speaking to the question Mr. Smith raised? Mr. CARDWELL. Yes, sir. It is the level at which we would make grants. It is comparable to the $232 million that is in the base budget for cancer. The $30 million is merely a bookkeeping estimate of the flow of cash out of the Treasury, that is, the normal rate at which cash against that level of grants would flow in the research field. The suggestion that the $100 million is a fraudulent figure just couldn't be farther from the truth.

Mr. SMITH. Mr. Chairman, I want to point out that our formula on this committee last year was to fund all Cancer Institute applications that had been approved, plus such increases as were necessary to keep their program at the same level. Last year the funding was $110 million for research grants. I am talking about the real research and not the general aid to colleges and so forth. When you get down to genuine research projects, it is $110 million. In the new budget there is $105 million. The amount necessary for adding to the $110 million to fund the new applications, plus the keeping of the same level due to inflation would be $25 million making a total of $135 million, so actually that figure of 105 is just about $30 million under what this committee under its formula would be appropriating anyway.

Secretary RICHARDSON. I would like to analyze those figures. Your figure does not take into account the additional $100 million. I will concede that the $100 million is intended for new projects, new initiatives. The issue you are raising is quite a different issue and that is the extent to which the base budget for the National Cancer Institute provides sufficient funds to finance continuation costs. It is my understanding that it is adequate to do this.

Mr. CASEY. Do you know where you are going to put this $100 million?

Secretary RICHARDSON. Yes, we do. I would like to call your attention to a paragraph of the President's message which says―― Mr. FLOOD. Which message?

Secretary Richardson. Health message.

It follows the point at which I broke off quoting before. It is the very next paragraph:

Because this project will require the coordination of scientists in many fields, drawing on many projects now in existence but cutting across established organizational lines, I am directing the Secretary of HEW to establish a new cancer conquest program in the Office of the Director of the National Institutes of Health. This program will operate under its own director who will be appointed by the Secretary and supported by a new management group to advise that group in establishing priorities and allocating funds and to advise other officials, including me, concerning this effort, and I will also establish a new advisory committee on the conquest of cancer.

This paragraph reflects a very deliberate judgment that the opportunities in the field of cancer research justify bringing together a group of people under a single director within the Office of the director of the National Institutes of Health in order to focus this effort as intensively as we believe to be practicable.

57-454 0-71-pt. 1-5

On the other hand, it also reflects the judgment that it would not be sound to adopt a course recommended by the so-called panel of consultants headed by Jean Schmidt.

Mr. FLOOD. I think that is an excellent conclusion.

Secretary RICHARDSON. We are very glad to have your endorsement.

INCREASE FOR HEALTH PROGRAMS

Mr. CARDWELL. Mr. Chairman, a second point before we close this part of our discussion. I would like to go back to your 6-percent increase. That is related to a net increase of $192 million. If you examine the non-medicare and medicaid portion of the

Mr. FLOOD. Even when you include this $100 million that you haven't actually requested yet.

Mr. CARDWELL. Right. If you include the $100 million. That is, as the Secretary pointed out, a net figure. There are two significant decreases netted against it. Taking the budget as it now appears and as it now rests before this subcommittee, and adding to it the budget amendments the President announced yesterday, the gross increases exclusive of medicare and medicaid, would exceed $400 million. That is about an 11-percent increase, if you want to reduce it to percentage

terms.

ADEQUACY OF BUDGET FOR EDUCATION PROGRAMS

Mr. FLOOD. What about this? For the Office of Education, despite all the talk about the importance of education, you have a net increase of only $275 million or-here we go again-less than 6 percent, if you leave out the $400 million for the one-time purchase of loan paper wo talked about, and that certainly is no program increase in the usual sense, and the $500 million for emergency school assistance, which should be classed, as the Secretary did, as civil rights.

Secretary RICHARDSON. And $800 million for student assistance. Mr. FLOOD. But you leave out the $400 million and that is certainly not a program increase in the usual sense, and the $500 million which is civil rights and, in addition, isn't even authorized yet, what do you get. You again have less than a 6-percent increase, which won't even cover the increased cost of doing business. Isn't that a standstill budget?

Secretary RICHARDSON. If you insist on leaving out all of our major initiatives and then calling attention to what little we are doing, it follows with inexorable logic.

Mr. FLOOD. That is no program increase, the $400 million.

Secretary RICHARDSON. But there is $800 million for student assist

ance.

Mr. FLOOD. Emergency school assistance is civil rights, and not even authorized.

Secretary RICHARDSON. I am talking about expanded student workstudy programs. Grants for work study are $643 million above fiscal 1971. Insured loans, $104 million above 1971.

Mr. FLOOD. I know. But I am looking at the totals.

Secretary RICHARDSON. These are major initiatives.

Mr. FLOOD. But also you have major decreases and you take the decreases and put them alongside the increases you are talking about

and the net increase is going to be less than 6 percent. It won't pay for increased costs, in my opinion.

Secretary RICHARDSON. The overall increase in higher education is $808 million. The overall increase in elementary and secondary education is $319 million.

Mr. MILLER. Mr. Chairman, we keep getting back into the same dialog.

Mr. FLOOD. We are using your documents. Look at this, "Office of Education" lower right-hand column, an increase of $1.175 billion. But then we see it includes the $400 million item and $500 million item that we have been talking about. That goes right back to the net increase of $275 million. Less than 6 percent.

Mr. MILLER. The point we keep trying to make is that wherever there are reductions they are made on the basis of program merit. If you take a net figure and relate it to the cost of living you really don't have two comparable pieces of the equation.

Secretary RICHARDSON. May I make a couple of observations.
Mr. FLOOD. Of course, you may.

Secretary RICHARDSON. One, I think it is important to recognize that there are major new initiatives in the field of higher education in student assistance primarily and in elementary and secondary education with respect to the problem of desegregation.

In order to be able to fund in the budget the very substantial increases that are required for these programs, very discriminating judgment has been exercised, program by program, with respect to all the other line items in the Office of Education budget.

We don't think every program should get an automatic 6-percent cost-of-living increase. Some should get more and some should get less. Mr. FLOOD. Of course, that is realining priorities.

Secretary RICHARDSON. Our budget, therefore, reflects, as we submit it to you, our best judgment.

Mr. FLOOD. I am the devil's advocate. It just will strike some people that this is an extraordinary coincidence and we may be asked about it when the bill is before the House. You will be sitting in the balcony. I will be down there explaining these things. Here are two of the big, important parts of your budget and they are almost exactly alike, a net increase of just under 6 percent.

Secretary RICHARDSON. I would strictly deny the basis on which you arrive at the judgment of less than 6 percent with respect to both programs. I think your arithmetic is phony.

Mr. FLOOD. People have thought that before.

Let us do it this way. I am making a point. It is not casual.
Secretary RICHARDSON. I am aware of that.

Mr. FLOOD. I really do think this budget is too low for the health and education programs; but, in addition to that, I must anticipate some inquiries of this type addressed to me. You take a look at this series of questions, and in the record set forth your position in more detail. It might help both of us. Especially I would like a good statement on education since we will be dealing with it first. Secretary RICHARDSON. I will be glad to.

(The information follows:)

CLARIFICATION OF OFFICE OF EDUCATION 1972 BUDGET LEVELS

The committee contends that the 1972 increase for the Office of Education amounts to less than 6 percent (the current cost-of-living increase). This calculation is made by subtracting out the $400 million one-time authority for purchases of loan paper (including advances) under the proposed student aid reform legislation. This amount represents a financial arrangement which does not constitute an increase in aid to students. Therefore, eliminating this amount from the 1972 total, as well as deducting the 1971 amount of $74,853,000 to make emergency school assistance comparable in the 2 years, results in adjusted totals for 1971 and 1972 of $4,414,515,500 and $4,613,381,000, respectively. This represents an increase of $198,865,500, or 5 percent over the 1971 level.

This analysis, however, fails to include the significant funds which this administration has earmarked in the 1972 budget for new education legislation, a total of $1,103 million. Detailed requests for these funds will be transmitted to this committee after enactment of the proposed legislation. When these additional funds are taken into consideration, the 1971 and 1972 totals are $4,914,368,500 and $5,716,381,000. This reflects an increase of $802,012,500 or 16 percent over 1971. To focus only on the funds being requested under existing and extension authorities is to see only part of the total request of the administration for the Office of Education, a sizable portion of which is in the area of new legislative initiatives.

To carry this analysis a final step further, the total budget authority requested for 1972 for the Office of Education is $6,127,791,455, an increase of $1,182,777,500, or 24 percent, over the 1971 comparable appropriation of $4,945,013,955. These amounts are arrived at by including the requested budget authority for purchase of loan paper, the permanent appropriations, and the civil rights education account which is not heard by this committee.

The following table I illustrates this explanation in tabular form.

Table II lists, for each individual Office of Education program, the 1971 appropriation, the 1972 President's budget request, and the increase or decrease. This points out that, even under the current request to the committee, the budget includes significant increases for high priority programs offset by decreases in lower priority programs.