An area redevelopment program is not charity. It is not a giveaway. It helps private enterprise create wealth where wealth is needed. It helps preserve self-respect and the democratic, self-reliant American way of life. Senator DOUGLAS. Senator Edward Martin, our esteemed colleague from Pennsylvania, was to have been here to testify on the general problem, and in support of the bill, S. 1433, which he and others have introduced. Senator Martin is a member of the very important Appropriations Committee and they have a pressing meeting this morning, so he is unable to appear, but he has a statement which his special assistant, Mr. Greene, has with him. I understand that Mr. Greene is here to testify. Would you come forward, sir? Before you testify, may I acknowledge that we have in attendance in the hearing room this morning a group of members of the Textile Workers Union of America from a number of States, including the State of Maine-which is the State where I grew up and in which I lived. I left there at an early age. We have union representatives from the State of Rhode Island, the State of North Carolina, the State of Georgia, the State of Tennessee, the State of Alabama, and the State of New Jersey. While I cannot ask these gentlemen to testify, I will be very glad to have them stand, and I want to thank them for their interest in this hearing. Mr. Greene, we are very glad to have you here, and we are sorry that Senator Martin is unavoidably detained. We know of his interest in this problem and appreciate your presence at this session very much. STATEMENT OF HON. EDWARD MARTIN, A UNITED STATES SENATOR FROM THE STATE OF PENNSYLVANIA, AS PRESENTED BY LEROY V. GREENE, SPECIAL ASSISTANT TO SENATOR MARTIN Mr. GREENE. Thank you, Mr. Chairman. Senator Martin asked me to express to you personally his very deep regret at being unable to be here this morning, and asked me to see you and present this statement. Senator DOUGLAS. Thank you very much. Mr. GREENE. The statement by Senator Martin reads as follows: Mr. Chairman, I appreciate this opportunity to appear before the committee in behalf of S. 1433, the Area Assistance Act of 1957, to implement the recommendations made by the President of the United States to assist areas of chronic unemployment in the United States. In his recent economic report, the President urged the Congress to enact such legislation and make necessary appropriations to assist localized areas in taking steps to develop and maintain stable and diversified economies by a program of financial and technical assistance. In the economic report, President Eisenhower reviewed various steps that have been taken to alleviate conditions in depressed areas. He stated in part: The high employment levels of the last few years have facilitated economic adjustments needed to correct persistent unemployment conditions in various areas. Although the Federal Government makes its greatest contribution to the solution of local unemployment problems by following policies which promote stable growth for the economy as a whole, there are many ways in which it helps local areas with more or less chronic unemployment. In awarding Federal procurement contracts, preference has been given to businesses located in such areas. Also, defense facilities constructed in the areas are accorded special accelerated tax-amortization privileges. Increased appropriations for the Office of Area Development in the Department of Commerce have made it possible to extend improved and augmented services to many such areas. The Department of Labor, through affiliated State agencies, has expanded community employment programs and services. But, as the President has further pointed out, greater efforts are needed to help certain localities strengthen their economic base. In some cases the forces responsible for persistent unemployment are so strong and so varied that they will yield only to comprehensive measures taken jointly by private groups, State and local governments, and the Federal Government. The bill which I have introduced is not a handout to local communities or States-nor will it establish a superstructure of Federal control that would deprive communities of the primary initiative in planning and financing their own economic development. Mr. Chairman, I realize the committee will study carefully the provisions contained in this proposed legislation-but I would like to briefly summarize some of the important considerations. Major programs proposed to help these areas involve technical and financial assistance. Technical assistance is available to all areas. To qualify for financial assistance, however, certain conditions must be met. In the first place, the areas assisted must be certified by the Secretary of Labor as having substantial and persistent unemployment; currently at the rate of 8 percent or more and at least 8 percent unemployment for the major portion of 2 preceding years. To assure that State and focal leaders join in the program, there must first be submitted by the area or community an overall program for its economic development, as well as a finding by the State that the project for which financial assistance is sought is consistent with that program. For the same reason, assistance is to be extended only to public or private persons or groups approved by the State in which the project is located. Loans may be made under this program for industrial site development, and construction and rehabilitation of factory buildings. Such assistance is not available for working capital, purchase of machinery or equipment, or to assist the relocation of establishments if this will cause unemployment in their original locations. The total amount outstanding at any one time for such loans is not to exceed $50 million. Grants for technical assistance, including studies to develop potentialities for economic growth will be available-not to exceed $1,500,000 in such grants annually. Borrowers must first exhaust the possibility of a loan on reasonable terms from private lenders or other Federal agencies before obtaining assistance under this act. Activities authorized by this act are to be coordinated with existing Federal programs. In such coordination the Departments of Labor, Health, Education, and Welfare; and the Housing and Home Finance Administration will take an active part, so as to provide the 91201-57-pt. 1—6 maximum assistance from the minimum Federal expenditure, by allowing special benefits under these programs for these areas. Mr. Chairman, with the high degree of prosperity in our Nation today, it is alarming and disturbing to realize that there are areas and pockets of unemployment-and actual want-in communities within our own States. It should be the first concern of our Government to solve these problems, so that all of our citizens can contribute to the fullest extent to the well-being of their families and the welfare of their country. In the pending legislation, S. 1433, I believe we have the means for attacking this problem. The program will aim at lasting improvement-not temporary re lief. Federal assistance will depend upon active financial participation by State and local groups. Initiation of programs, administration, and control of funds allocated will remain at the State and local level. I urge the committee to give its earnest consideration to this legislation, with the hope that we can get action upon a program in this session of Congress. That ends the statement of Senator Martin, Mr. Chairman. Thank you so much for your consideration. Senator DOUGLAS. Are there any questions? Senator SPARKMAN. I notice you say the total amount of loans outstanding at any one time shall not exceed $50 million. Do you have a limitation for States? Mr. GREENE. No, sir. Senator SPARKMAN. In most of the programs of this type we have written in a maximum limitation for any one State in order to make certain that it is not all placed in 1 or 2 or 3 States. I merely put that out as a suggestion. Mr. GREENE. Yes, sir. Senator SPARKMAN. Thank you. Senator DOUGLAS. Senator Clark. Senator CLARK. Mr. Greene, I wonder if you could help me out as to the present number of unemployed in Pennsylvania? Mr. GREENE. Sir, I have those figures in the office where I work with them, as you do, every day, but I did not bring them with me because I did not anticipate being questioned. Senator CLARK. My recollection is it is in excess of 250,000, and in the neighborhood of 300,000. Would that jibe with your memory? Mr. GREENE. Generally, that is my recollection, but somewhat less. Senator CLARK. You would agree, would you not, that there has been a great loss in Pennsylvania in mining, which has been continuing for a good many years? Mr. GREENE. There is no question about that. That is a very critical situation beyond any doubt, and continues to get worse. Senator CLARK. I think we will agree that in a town like Altoona, for example, the employment opportunities are far less than they used to be when the railroads worked by steam and the shops were operating at a fairly high level of employment. Mr. GREENE. I think it is a comparable situation with so many communities, but the real problem here, as we see it, is in the anthracite and bituminous regions. Senator CLARK. Yes. Mr. GREENE. You made reference in your testimony to the possibility of ghost towns, and that sort of thing, where the mines had closed and they were a one-industry town. The persons who were residents of those towns continue to live there because of their home ties. Senator CLARK. Yes. I wanted to get your reaction as to whether you thought I substantially overstated the situation in our State with respect to the need for this kind of legislation? Mr. GREENE. No, sir. Senator CLARK. I am wondering whether you would agree with me that we in Pennsylvania could spend the entire $50 million called for by the administration bill without any difficulty at all, and all to good purpose. Mr. GREENE. It is an interesting question, sir. I would hesitate to speak for the Senator on that. Senator CLARK. I would be happy to know whether the two Senators from Pennsylvania would concur in that position. Mr. GREENE. I think the two Senators from Pennsylvania would find it a very interesting area for discussion. Senator SPARKMAN. May I suggest perhaps that is a good reason for the Senators from the other States to make certain that there is a maximum limitation put in the bill. Senator CLARK. That goes through my mind, Senator Sparkman. The other way to handle it is to be sure the initial grant is large enough. Do you know why the administration bill does not permit loans for machinery and equipment, but only for land and buildings? Mr. GREENE. I believe Senator Martin will want to discuss that point. Senator CLARK. Would you see any immediate objection to permitting loans for machinery and equipment? It occurs to me that in many light industries that is frequently the heaviest part of needed expenditures. Mr. GREENE. In view of the very broad area involved I know Senator Martin will want to speak on that directly. Senator CLARK. Do you have any thought, Mr. Greene, as to why the administration bill has a loan limitation of 35 percent of the needed funds and restricts loans to 25 years? Are you aware of the thinking behind that? Mr. GREENE. Senator Martin will want to present that detail. Senator CLARK. I suppose you would not have any personal thought and I am just trying to bring it out in the record-as to why the administration bill has not provisions permitting either grants or loans for the construction of public facilities? Because I assume you will agree with me there is many a community in Pennsylvania, and I assume elsewhere, which is badly in need of public facilities, but local resources are unable to provide them in view of the curtailment of the tax rolls as a result of the cutting of employment. Mr. GREENE. Again I am sure Senator Martin would prefer to discuss that personally, for the reason that various communities-and so many of them as you so well know-have set up their own agencies for purposes of self-help, and there could be broad areas of conflict there which would naturally be the subject of considerable debate. Senator CLARK. Thank you very much. Senator DOUGLAS. We want to thank you very much for coming, Mr. Greene, and compliment you on the ability with which you presented your point of view. I want to say for the record we know of Senator Martin's interest in this matter and know he would have come if it had not been for important work on this other committee to which he had a prior commitment. Mr. GREENE. May I thank the chairman and the committee for their courtesy. Senator DOUGLAS. Yes. Thank you. We have an all-senatorial cast this morning. Our next witness is our distinguished colleague from Alabama, Senator Sparkman. STATEMENT OF HON. JOHN SPARKMAN, A UNITED STATES SENATOR FROM THE STATE OF ALABAMA Senator SPARKMAN. Mr. Chairman and my colleagues on this subcommittee: I appreciate the opportunity of presenting a statement to the subcommittee with reference to underemployment in depressed industrial and rural areas. I am glad to be numbered as one of the sponsors of the bill S. 964. Senator DOUGLAS. If the Senator will allow me to interrupt, you were not only one of the sponsors, but I think you were the first person who called to the attention of the country the poverty and underemployment in rural areas of the country. The report which you prepared for the Joint Economic Committee on low-income families was a trail-blazing affair which influenced our thinking and which led to the incorporation of the rural areas feature in the bill last year. So that you are one of the fathers of this legislation. Senator SPARKMAN. Thank you, Mr. Chairman. If that be true I am a very proud father, although I may say in recent years I have moved into the classification of grandfather. Mr. Chairman, while I urge particularly favorable consideration of S. 964, I want to say that I am delighted that there are other bills introduced on this subject because it shows the general interest in this particular type of legislation. The chairman of the subcommittee will recall that some 2 or 3 years ago I introduced a bill which had particular application to rural areas. As a matter of fact it was an agricultural bill in which I sought to extend the program of technical assistance to the lowincome rural counties of the United States. Then, in 1955, the study to which the chairman has referred was made, and in the last Congress the distinguished Senator from Illinois introduced a bill relating to depressed areas. I recall quite well his talking with me regarding the inclusion of the rural feature of my agricultural bill in it, and it was included in the bill that passed the Senate last year. |