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penditure of $42,435,000 for 3 dams in the Logansport and Huntington area of Indiana.
Again, let me say that we accept the judgment of those making such favorable decisions for those areas and respectfully solicit the same sympathetic understanding of our needs. We do not want you to take one thing away from those people.
Such proposed canalization of Big Muddy River and Beaucoup Creek would make the very heart of our distressed southern Illinois area accessible to the barge routes of the whole North American Continent when the St. Lawrence seaway is finally completed. I can envision processing plants for aluminum, iron-ore fines and chemicals being located along these routes. It is also possible to have electric generating plants at the mine site with adequate water at the same location for cooling, thereby reducing the cost of electricity to other industrial users. All of these developments would attract related and allied manufacturing concerns.
Mr. A. C. Ingersoll, Jr., president of the Federal Barge Lines, St. Louis, in a speech before the Traffic Club of New Orleans on October 10, 1955, spoke in glowing terms of the advantages of "the 6,000 miles of the priceless asset of our unmatched system of inland waterways." He cited benefits to industry, farmers, consumers, and even to competing carriers. If that be true, it would certainly be a cure for the coal counties of southern Illinois.
A second assist for the coal industry would be the development of a pilot plant for the extraction of chemicals and exploring new uses for the coal-carbon residues. That is what the Olin-Mathieson people have already worked out with Pittsburgh Coal and American Gas & Electric. I understand that great possibilities lie in this field. A third suggestion is that you look with a critical eye on the effect on the coal industry by the importation of low-grade residual oil.
Now, here, I offer education as a cure for chronic unemployment: The solution to the coal problem will take from 3 to 5 years and will affect most directly those people living in the coal-producing counties. I now suggest that consideration be given to a program of reeducation for our trainable relief clients and other unemployed people whose physical and mental qualifications are such that such training could be justified.
It has been my observation that educated people, for the most part, are employed-even in our distressed labor areas. It is the unskilled and uneducated that create our problems. We need a change in our public-assistance laws-from one of continuous or perpetual relief to one of rehabilitation.
Why should relief money when spent not be used to enhance the recipient's ability to reenter the labor market with a knowledge, trade, or skill that will make such a person self-supporting? I think the public aid commissions should be authorized to enter into training agreements with existing qualified training schools for the purpose of teaching practical vocational skills that industry and society will buy. Many of our people are ex-coal miners or ex-farmers and are stranded between older industries that did not require close tolerance skills and technical knowledge. Such a program could greatly reduce the relief and unemployment rolls within 2 years.
Until after World War II this area was not considered an industrial area. Since that time several hundred small industries and a few large nationally known industries have been induced to locate here. We have the competition of lower wages down South and other generous inducements some southern States have seen fit to offer. We also compete with lower electric rates in the TVA area, just across the Ohio River from our southern Illinois counties.
In order to succeed, our communities have organized industrial committees and have subscribed sums running from $50,000 to $400,000, depending on the size and financial ability of the community, to be used to purchase sites and finance buildings to attract industry. Herrin is a fine example of such efforts and they have attracted five major industries, employing approximately 3,000 people.
I would say here these are not taking industries away from anyone else, but these have been expansions within the industry and these are branches of larger nationally known concerns.
Such results naturally encourage other communities to try that plan. To adequately finance such undertakings, not thousands but millions of dollars are needed. We can use local funds for a small part, but the major part must come from large trust funds and insurance companies. Since this is a capital deficient area, we urge you to set up a revolving fund that can be borrowed by our communities when secured by leases from financially solvent manufacturers. We now have a proposal that will employ 1,000 to 1,200 men. It will require about $500,000 local investment and a loan from someone amounting to $1,500,000 for 15 to 20 years at 412 to 5 percent interest. We shall make every possible effort to do the job. This depressed area bill would certainly give us a lot of help at a time when we need it. We have the good fortune to have the United States Fish and Wildlife Service at Crab Orchard refuge operating buildings left intact at Ordill. These buildings formerly housed the Illinois ordnance plant, a shell-loading operation during World War II. Approximately 800,000 square feet of good manufacturing space is available to industry. Fifteen or twenty substantial manufacturers are operating there and employ 2,000 to 2,500 people. The management of that agency of the United States Department of the Interior has been very cooperative and helpful.
I consider a public-works program a must for the immediate alleviation of suffering in this area. We need large reservoirs of water for industry and flood control. We need extensions of our waterworks and sewage-disposal plants. We need new roads and repairs for our old roads. Our cities have suffered serious financial difficulties because until this year, 1955, they depended on inadequate tax revenues. Since our general assembly permitted cities to levy a one-half of 1 percent sales tax, they are on the road to solvency and could match some funds with a Federal works program.
I placed the works program near the end of my suggestions because I believe it only provides an immediate solution to a pressing need and I do not consider it a permanent cure. We want a healthy econ
omy based upon our resources and our ability to compete equally in commerce and inducements to industry.
FEDERAL MAXIMUM SECURITY PRISON
A Federal penitentiary has been proposed for some community near the center of United States population. We can qualify for that project and would be pleased to have it located in southern Illinois. Proposed defense and development projects would certainly be appreciated in this area.
A healthy agriculture is a problem that confronts so many areas that it is not peculiar to a distressed area. However, we seem to be suffering more because of our marginal operations. We do hope you will continue to encourage good farm practices and further the development of our southern Illinois timber resources and potentialities. I doubt if a fair and full solution to the farm problem of this Nation has yet been proposed. I am trying to get people off relief rolls and I am not going to suggest that the farmer be further subsidized as a permanent policy.
I believe our chronic unemployment and excessive relief problems can be cured permanently by
1. Helping our coal industry (a) by providing inland waterways to attract raw manufacturing products to the coalfields for processing. At this point I think I should say that if we could do that our coalfield would produce instead of 16 million tons a year-it would produce 26 million tons, or a gain of 10 million tons a year. That would require at least 2,500 additional coal miners; 2,500 additional coal miners would require at least 2,500 additional service people. That would be 5,000. It is reasonable to assume that 1 or 2 major aluminum companies, or chemical companies, or steel-fabricating companies, or something in the heavy industry would move up in that area, where the fuel would be cheap and convenient, and would employ at least 5,000 more people.
It is reasonable to assume that this thing alone would bring 10,000 jobs to this area-10,000 jobs would produce at least $3 million increase in income tax alone.-You could save at least $ 2 million on the general assistance by having those 10,000 people working. There is a saving to the Government of $5 million a year, not to speak of the fact that if we did ship that 10 million tons down the river, there would be a saving of at least 50 cents a ton freight, and there would be another $5 million. So simple arithmetic will soon build up a gain on the positive side of the ledger of $10 million a year; for a project that would only cost $30 million or $40 million, at the very most $50 million, would pay for itself in 5 years.
(b) Developing coal-utilization plants.
(c) Impounding great reservoirs of water at the site of the coal reserves to generate cheaper electricity and encourage chemical industries to locate in southern Illinois.
(d) Reduce imports on competitive fuels.
2. Provide education for trainable or educable unemployed and relief clients to upgrade their skills so industry and society will employ them.
3. Making funds available for purchase of sites and construction of buildings to attract industry and to make loans more easily obtained for responsible small business.
4. Start a comprehensive program of public works to provide interim employment until the more permanent and lasting remedies can be achieved.
Following are some of the southern Illinois "wants" outlined by citizens at a mass meeting on December 31, 1955, at West Frankfort, Ill.:
Charles Covington, Mount Vernon-"We need 'big league' water. Rend Lake surveys are now being made. The United States is going to pay for a dam in Egypt. We can use one here."
Harvey Ward, Mounds-"Pulaski County has 1,081 on aid of some kind. We need loans for development of industry. We need flood-control projects."
Omer Sanders, Cartersville "I can remember hearing 19 different mine whistles when I was a boy. Now there are none."
Wayman Presley, Makanda
A road is needed to pass by the proposed mammoth lighted cross atop Bald Knob.
"If we get the road, we can bring 500,000 tourists to southern Illinois." George Schneider, Ava-"A system is needed to get plants into the community." He called for the construction of lakes in flood control.
Ray Miller, Sesser
Sesser has obtained a garment factory employing 25 persons.
"We have several other prospects, but need buildings. We need $50,000 for 2 buildings."
Harold Grob, Murphysboro-"We need a new sewerage disposal plant, a new city hall, and new junior high, additions to the lower grades."
Rural schools around Murphysboro need more assistance and more lakes are needed for recreation, including Kincaid Lake. The canalization of Big Muddy River and the proposed Rend Lake are needed. Roy Hensley, Rosiclare "We in Hardin County have suffered much from fluorspar imports. We have lost many of our younger people who have moved away to find work. We don't want relief. We want to work. We ask the Federal Government to consider the fluorspar import problem and the State to consider lake projects and recreational facilities."
Down below there are some statements made at a mass meeting in West Frankfort in late December, different people making comments on what they thought would be a solution to our problem. If I may take a little more time, I would like to talk about 8555, the House bill. The CHAIRMAN. Mr. Brown.
Mr. BROWN. May I ask you a question?
Mr. HUGHES. Surely.
Mr. BROWN. Suppose you develop this area as you have outlined in your statement; will you have a market for all that coal?
Mr. HUGHES. Yes, sir. The electrical market, the electrical-generating industry, will take it all, because a few short years ago, the electrical industry was doubling every 15 years, and a short length of time ago, 5 or 6 years ago, they were doubling every 10 years. Now the industry is doubling every 71/2 years, and the electrical-generating industry alone could take this additional coal without taking coal away
from anybody else. Actually, we are importing coal into southern Illinois as of now.
Mr. BROWN. Is there a surplus of coal now in this country?
Mr. HUGHES. Is there a surplus of coal?
Mr. BROWN. Yes.
Mr. HUGHES. There could be if the mines worked, there could be a tremendous surplus.
The CHAIRMAN. Are all the counties which are suffering this depression coal-producing counties?
Mr. HUGHES. About 7 of the 15 or 16. We have 4 or 5 fruit counties, the map will show; the coal counties of Union, Johnson, part of Jackson, those counties are suffering because of the hardships I explained there, but we want to put them back on their feet with a good fruit-freezing and processing plant so they can stay in the market, other than just the fresh fruit market.
The CHAIRMAN. That whole district is largely rural; are they any big cities?
Mr. HUGHES. No cities larger than 15,000, Cairo and West Frankfort and Carbondale, Marion, would be considered the larger towns, running from 10,000 to 15,000.
The CHAIRMAN. What other industries do the people depend on in normal times besides the mining and coal? There is fluorspar there? Mr. HUGHES. Fluorspar is in Hardin County. That is more or less localized in the very southern tip over to the southeast. People depend on farming, timbering, coal mining and recently, since World War II we have been able to bring about a thousand new jobs a year in manufacturing. If we can have a little bit of encouragement, a little support from some of these distressed area bills, we will be able to attract more industry there and I want to very specifically say we don't take industry away from somebody else but as they expand in their operations if we can move in, and build buildings for them, we can attract branch factories, which we have done from Boring-Warner and from Allen Industries and from Sangamo, and people like that. The CHAIRMAN. The predominant effect is from the coal mines being down, is that right?
Mr. HUGHES. I would say so.
The CHAIRMAN. You have the same problem that eastern Kentucky has.
Mr. HUGHES. I believe so.
The CHAIRMAN. You say an aluminum plant was thinking of establishing its business there, and after investigation it refused to come. What did the investigation show? What was it you didn't have that they wanted?
Mr. HUGHES. We didn't have barge transportation and we didn't have water in great quantities. They have to have water to generate electricity and they didn't want to transport the coal 75 miles from the coal field down to the Ohio, or down to the Mississippi, but rather they wanted to open up that Big Muddy River up into the heart of the coal field so they could mine the coal and convey it by belt. These high-pressure boilers will generate electricity for 4 cents a kilowatt. We are not disturbed in the coal field from competition by hydroelectricity. We are disturbed because we can't get the raw materials, bauxite, and things we need for industrial development. We are landlocked by about 75 miles.