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STATEMENT OF WALTER ALESSANDRONI, CHAIRMAN, NATIONAL HOUSING COMMITTEE, AMERICAN LEGION

Mr. ALESSANDRONI. Thank you. My name is Walter E. Alessandroni, Chairman, National Housing Committee of the American Legion.

In answer to your question, Mr. Chairman, the Legion believes that if the Government is going to insure loans, in the present market, and, in addition, to provide a secondary market, that 4 percent interest is adequate.

I might also point out that any attempt to grant an increase

The CHAIRMAN. What did your survey show with respect to that? We have been working on this subject for months, and the Administrator of the Housing and Home Finance Administration, who is pretty close to this situation, tells us that he needs a flexible interest rate to meet the market. Now, upon what basis did the American Legion conclude that we should not amend the interest rate or authorize a flexible interest rate to meet the market in order to get home financing? I am interested in the thinking of the American Legion. What did they predicate their finding on?

Mr. ALESSANDRONI. It is predicated on the two factors that we are giving aids to people who are lending money in two ways—both by guaranteeing the loan and, secondly, by creating a secondary market through which they can get rid of their paper, and it is believed that 4 percent is sufficient.

The CHAIRMAN. On what do you predicate that belief? That is what I am trying to find out. What studies did you make to determine whether 4 percent was sufficient? We found that municipal issues were yielding 3.1 or something like that, and Federal Housing Administration paper was yielding 2.96 percent, I believe. And we recommended in this committee, and sent a bill over to the Senate authorizing a flexible interest rate, so that there would always be a market for Federal Housing Administration paper. We are interested in the thinking of the American Legion behind their action in wanting this interest rate frozen at 4 percent.

Mr. ALESSANDRONI. I can only give the answer I just gave, Mr. Chairman. We have no statistics except to point out that it does not seem necessary, in today's market, in which we are already giving two aids, to give a third aid in order to attract this money. We feel it will necessarily come of its own accord if kept at 4 percent.

The CHAIRMAN. I did not mean to interrupt your statement. Will you go ahead?

Mr. ALESSANDRONI. Yes, sir. I have no general statement to make, Mr. Chairman, except to answer any questions that the members of the committee might have.

I might say briefly, in addition to what Colonel Taylor has already said, that the American Legion's position on housing has been, and still is today, that the Congress' first concern should be about veterans' housing, because primarily that is where the greatest need is. Unless we get some specific legislation which gives the veteran some absolute priority, he will be lost in the shuffle of the higher prices as the prices go up. Clearly one of the things which is going to make the prices of housing go up is the easier credit that is going to be afforded. As the prices of houses go up and the veteran is limited in what he can

afford to pay, he is, of course, shut out of the market even though he has some kind of semblance of priority. So we are asking specifically at this time that your committee give consideration to amending the bill now before you by adding to it the provisions of the Veterans' Homestead Act which has been reported out of the Veterans' Affairs Committee as of a few weeks ago.

We think the provisions of that bill will fill a void that is now present in the pending S. 866. It is veterans legislation. The Legion makes no claim that it will solve the Nation's housing problem, but it will materially assist thousands of veterans who desire to assist themselves. It is a plan for cooperative housing in which credit aids are given such as are not provided by any other form of legislation, and those veterans who will band together to build, for rent or sale, lowpriced housing within their means.

We think that if the Congress is going to pass an omnibus housing bill, there must, of necessity, be included in that bill specific provisions above and beyond those presently existing, for veterans' housing.

The CHAIRMAN. May I ask, Mr. Alessandroni, did you present this

matter to the Senate?

Mr. ALESSANDRONI. Did we present this matter to the Senate?
The CHAIRMAN. Yes.

Mr. ALESSANDRONI. Does the Chairman mean H. R. 4488?
The CHAIRMAN. Yes.

Mr. ALESSANDRONI. No. H. R. 4488 was introduced in the Senate. There have been no committee hearings as yet.

The CHAIRMAN. I mean did you present it to the Banking and Currency Committee when they had S. 866 up?

Mr. ALESSANDRONI. H. R. 4488?

The CHAIRMAN. Yes.

Mr. ALESSANDRONI. No, sir.

The CHAIRMAN. Why did you not present it to the Senate committee?

Mr. ALESSANDRONI. Because it was referred to another committee. It was referred to another committee. It was referred to the Senate Finance Committee.

The CHAIRMAN. Mr. Alessandroni, that is no reason at all, if I may be abrupt, because you are before this committee now, the House Banking and Currency Committee, and that bill is not before this committee. You are asking us to add it to this bill. Why did you not ask the Senate committee to add that bill to S. 866? Why did you not ask the Senate committee to add that bill to S. 866 as you are asking this committee to add it now?

Mr. ALESSANDRONI. Because, as was pointed out, at that time the American Legion did not have the policy it has today.

The CHAIRMAN. You had a mandate on that bill right along, had you not?

Mr. ALESSANDRONI. On H. R. 4488?

The CHAIRMAN. Yes.

Mr. ALESSANDRONI. That is correct.

The CHAIRMAN. Why did you not ask the Senate Banking and Currency Committee to add it to S. 866?

Mr. ALESSANDRONI. Because our bill had been referred to the Senate Committee on Finance.

The CHAIRMAN. All right. Go ahead.

Mr. ALESSANDRONI. That briefly, gentlemen, is the Legion's position. We think this is the pertinent time for discussion

The CHAIRMAN. Let me ask you about the Legion bill which has been before the Veterans' Affairs Committee. What is the total authorization in that bill? What does it amount to? What is it for? We have never had it before this committee.

Mr. ALESSANDRONI. The bill provides for a billion dollars a year in repayable loans, for 5 years. It provides for 200 million dollars to be appropriated to the Federal Works Administration, which is the only outright cost to the Government, as a subsidy, for assistance in public improvements to the homes that are to be built. It provides for 750 million dollars for aids to certain types of lending associations.

The CHAIRMAN. It provides for $3,750,000,000 for lending institutions altogether?

Mr. ALESSANDRONI. If that is five times that amount, yes.
The CHAIRMAN. Yes.

Mr. ALESSANDRONI. Except that it must be pointed out

The CHAIRMAN. Is this substantially correct? Section 511 of H. R. 4488 provides for loans to local organizations in the potential total of 5 billion dollars.

Section 512 provides for grants for public facilities of 200 million dollars, as you said.

Section 513 provides for investment in lending institutions of $3,750,000,000.

Section 514, Farm Loans, 500 million dollars, for a total of $9,450,000,000. You also want us to pass S. 866, do you not? Do you know how much there is involved in S. 866?

Mr. ALESSANDRONI. Well, I would like to first comment, if the chairman please

The CHAIRMAN. Do you know how much is involved in S. 866? Have you made an analysis of it to determine that?

Mr. ALESSANDRONI. Yes, except

The CHAIRMAN. How much?

Mr. ALESSANDRONI. Well, I do not

The CHAIRMAN. I will tell you. There is over 10 billion dollars in S. 866. Is the American Legion asking us at this session of Congress to obligate the American Government for $19,450,000,000?

Mr. ALESSANDRONI. That will solve the housing problem unquestionably; yes.

The CHAIRMAN. It would solve a lot of problems, of course, but where are we going to get 19 billion dollars? Is that the American Legion program, that this Congress should authorize 19 billion dollars this year to build houses? Is that the program of the American Legion?

Mr. ALESSANDRONI. That is not the program of the American Legion. The CHAIRMAN. Well, tell us what the program is. The American Legion has a mandate to tell us to pass S. 866 and also a mandate to tell us to pass H. R. 4488 which totals, according to my figures, over 19 billion dollars. Now, tell us about it.

Mr. ALESSANDRONI. I would first like to explain the figures as calculated by the chairman. There is a distinction between the contingent liabilities provided in the bill and the outright payments. During the

war the Congress appropriated a great deal of money in outright subsidies, not only in contingent liabilities for war workers. The American Legion feels that the Congress can do

The CHAIRMAN. We never spent 19 billion dollars.

Mr. ALESSANDRONI.-No less in its appropriation of funds for vet

erans.

The CHAIRMAN. Then, the position the American Legion takes is they want this Congress at this session to obligate the Federal Government, in contingent and actual, to the extent of 19 billion dollars in this field of endeavor; is that it? Is that your understanding?

Mr. ALESSANDRONI. I am trying to explain that the chairman's attempt to show the total cost over a number of years does not give the correct picture of the situation.

The CHAIRMAN. Well, there is 5 billion dollars in S. 866. There is no question about that, is there? As a matter of fact, there are 6 billion dollars in S. 866. There is no question about it. It is not a contingent liability. It is an actual liability.

Mr. ALESSANDRONI. If you multiply it by the number of yearsThe CHAIRMAN. That is what you have got to do. are doing here.

To whom did the American Legion submit this? submit it to the State Department?

Mr. ALESSANDRONI. H. R. 4488?

The CHAIRMAN. No; S. 866.

That is what we

Did they ever

Mr. ALESSANDRONI. Do you mean to the American Legion's departments?

The CHAIRMAN. Yes, who made up the mind of the American Legion to the effect that they wanted S. 866?

Mr. ALESSANDRON. I do not think

The CHAIRMAN. A moment ago they had not made up their mind on it. Now, I want to find out who in the American Legion is now sponsoring S. 866, whether it is the rank and file, whether you ever passed upon it at a National Convention, or at a State conventionwho in the American Legion now is coming out and telling us that they want S. 866 passed.

Mr. ALESSANDRONI. Under the operation of the American Legion, at its last National Convention, resolutions favoring the passage of the Taft-Ellender-Wagner bill were propsed. At that time the resolution to approve the Taft-Ellender-Wagner bill was not approved. That placed the Legion in the position of saying-and the reasons it was not approved were not the many reasons given by various groups, but the reason it was not approved was that it did not sufficiently take care of veteran priorities, and not the various excuses of public housing, and the others, that have been given. It was because that bill did not provide sufficiently for veterans' housing

Mr. COLE. May I interrupt? How do you know that was the reason they voted against it?

Mr. ALESSANDRONI. Well, I was a member of the committee. The CHAIRMAN. Was there not a committee appointed at that time

Mr. ALESSANDRONI. May I answer this question first, Mr. Chairman? The CHAIRMAN. Was not the committee appointed in substitution of the Committee on Resolution to approve the Taft-Ellender-Wagner bill?

Mr. ALLESSANDRONI. Well, now, I am going to have difficulty. The CHAIRMAN. You are going to have difficulty unless you tell us who in the American Legion is approving this bill.

Mr. ALESSANDRONI. I am very happy to do that, but I cannot do it if I am going to be asked two or three questions and not be given the opportunity to complete my replies.

The CHAIRMAN. Go ahead. I would like an answer to my question which I asked you some time ago, and to which I have not yet had

an answer.

Mr. ALESSANDRONI. As a result of that, the American Legion went on record as not favoring the sponsoring of that resolution, or several resolutions, in favor of the Taft-Ellender-Wagner Bill. In the interim, the National Housing Committee of the American Legion determined, by resolution which was approved by the National Executive Committee, that H. R. 4488 should be made a part of S. 866. If the Congress was going to pass an omnibus bill, the Legion said, "We want, as part of that omnibus bill, the provisions for which we have provided in H. R. 4488."

The CHAIRMAN. Do we understand that to mean that you have never approved, then, the provisions of S. 866? That if we strike out all after the enacting clause in S. 866, and write a new bill, that you want the provisions of H. R. 4488 included? Perhaps I am mistaken. From my reading of the newspapers, I got the impression that the American Legion had approved S. 866. Perhaps you have not.

Mr. ALESSANDRONI. Well, I am surprised that a Congressman would depend on what he read in the newspapers. The Legion is here today to testify explicitly, and the resolution speaks for itself.

The CHAIRMAN. Say specifically, then, whether the American Legion is for S. 866 as it is now written or not.

Mr. ALESSANDRONI. The American Legion has no mandate on S. 866 with no consideration of H. R. 4488.

The CHAIRMAN. What is the position, then, of the same people who are asking us now to tack H. R. 4488 onto S. 866? What is the position of that executive committee with respect to the provisions of S. 866? That is what I thought you were going to testify to here.

Mr. ALESSANDRONI. The executive committee, by resolution which was approved by the national executive committee, states that S. 866, with the various amendments that were introduced by Senator Flanders of Vermont, together with H. R. 4488, is a piece of legislation which the American Legion is for.

The CHAIRMAN. Now, which of the amendments offered by Senator Flanders? Senator Flanders has offered a substitute bill for the original Wagner-Ellender-Taft bill.

Mr. ALESSANDRONI. As the bill now is up for consideration before your committee as passed by the Senate.

The CHAIRMAN. Then, we can get an answer to the question. The executive committee of the American Legion wants us to pass S. 866 as it was passed in the Senate; is that right?

Mr. ALESSANDRONI. No; that is not right.

The CHAIRMAN. Well, that is just what you have said. You have said you are for the Flanders amendments and S. 866 is the Flanders amendments. You had better go back to your executive committee and find out what you are doing here before you come before this committee,

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