favorable employment markets and many have been induced to come by the pleas of labor-short industry. This has created a tremendous strain on our housing accommodations as well as our schools and public services. This has resulted in the overcrowding of families and and increased need for school construction and the cost of public services. For the greater part, most of these people will remain and become permanent residents. If we are seeking in this legislation to approach a solution to the complete problem of the depressed areas, it seems to me that we should provide some relief for those communities which must build adequate housing, school, and public service facilities to provide for the people who migrate from the depressed areas. The local citizens should not be compelled to assume the added costs of municipal services. These cities should receive help in school and housing construction comparable to that which is provided in other federally-impacted areas. While it is important that we provide help for the depressed areas in order to stabilize employment conditions, we must at the same time provide help for urban areas which face the impact of increasing population density by reason of the shift in population from depressed areas to urban areas with favorable labor markets. Cleveland is such a city and as one of its Representatives, I have requested committee counsel to prepare an amendment or separate legislation to provide some form of assistance to help impacted cities in their added burdens of education, housing, and public services resulting from population shift caused by interstate factors. STATEMENT OF HON. KENNETH J. GRAY, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF ILLINOIS Mr. GRAY. Mr. Chairman and members of this fine committee, I am indeed grateful for the opportunity to appear once again before your committee in support of a bill to aid economically distressed areas. One of the distressed area bills before your committee is H. R. 10472 of which I am the author. I have the honor of representing the 15 southernmost counties in the great State of Illinois and before settling down to specific facts concerning our true economic conditions as they now exist in southern Illinois, please let me first preface my remarks by saying that due to coal and flourspar mine closures and other factors, the economy of southern Illinois has been slipping for the past 10 years. The people of this region, through their chambers of commerce, Southern Illinois, Inc., community development programs, and other groups have done an outstanding job in trying to promote private industry to our region to take up some of the unemployment slack; however, the economic decline has been so great that the results of their endeavors have not been fast enough to prevent an economic recession in which we find ourselves at the present time. Southern Illinois is made up of fine people, good schools, churches, and bounded on both sides by two of the greatest navigable streams in the world, the Ohio and Mississippi Rivers, but is severely hurt economically and if Federal help is not forthcoming, thousands of additional people will be forced to leave the area to seek employment. There are 31,000 able-bodied men and women in my congressional district unemployed and according to the latest figures from the Illinois Public Aid Commission, there are 51,876 persons receiving Government surplus food in the 15 lower counties of southern Illinois. In an effort to spotlight the needs of southern Illinois and to give each community a chance to stand up and speak out in behalf of their wants and needs, I called a nonpolitical fact finding forum for December 31, 1955, and urged every man, woman, and child in southern Illinois. to attend. I invited every State and Federal official concerned with this type of problem, from President Eisenhower on down. I was indeed gratified by the huge success of the meeting which was made possible by the attendance of 35 southern Illinois mayors, an estimated 5,000 private citizens and a score of officials from various chambers of commerce, Southern Illinois, Inc., Southern Illinois University, community development organizations, and other spokesmen representing individual cities and villages who came to the "sink or swim" meeting to tell their story and every word uttered received the utmost attention from the following State and Federal officials who were in attendance. List of State and Federal officials attending "sink or swim" meeting held at West Frankfort, Ill., Dec. 31, 1955 Representing United States Senator, chairman, Joint Committee on Economic Report. Representing Illinois State Director of Labor. Representing Ezra T. Benson, Secretary, U. S. Department of Agriculture. Representing Administrator Wendell Barnes, Small Business Administra- Representing Illinois Department of Labor. Representing Illinois Industrial and Planning Commission. Member of Congress, 23d District of Illinois. State Representative, Illinois. Do. U. S. Department of Commerce, personal representative of President Do. State Representative, Illinois. Do. Do. Representing U. S. Health, Education, and Welfare Secretary. Representing Department of Public Welfare. Representing U. S. Interstate Commerce Commission. Representing Wendell Barnes, Administrator, Small Business Admini stration. Do. Representing Illinois Department of Labor. Representing State of Illinois Auditor's Office. I expended months of hard work in organizing such a factfinding forum and I believe it was well worth the effort because it accomplished at least three specific things: (1) It gave the people of southern Illinois a chance to tell of the true economic conditions existing in their respective communities; (2) through questionnaires, an opportunity was provided to list projects needed to stimulate the local economy; and (3) focused State and Federal attention on our plight with a view that the information derived from each community would be helpful in setting up a distressed-areas program. Speakers came from every walk of life-rich man and poor man, banker and coal miner, and each one reiterated a common plea to officials in attendance that "we don't want charity or doles; we want to work” but, they pointed out they had no chance to work. No jobs were to be found, they said, unless they left their homes and went to some other place. It was brought out in the meeting that the people are very disgruntled with the Government for sending billions of dollars overseas in foreign aid while communities in the United States are suffering economic chaos, and could be utilizing these funds to alleviate human suffering at home. We were privileged to have Senator Douglas at our meeting to discuss some of our problems and offer ways of improving conditions and have him explain the provisions of his depressed-areas bill, S. 2663. President Eisenhower personally directed that Mr. Clyde Miller and Mr. A. L. Rascher, of the United States Department of Commerce, report back to him their findings of the forum. They summed up conditions in southern Illinois by including in their report that the "area is economically depressed and needs Federal assistance." Gentlemen, I call these facts to your attention because they reflect the opinion of unbiased individuals who were sent into our area to review our economic plight. Similar reports will be forthcoming from other State and Federal officials in attendance. In addition to our industrial plight, our farmers are also experiencing undue hardship. In a survey that I conducted in my district in cooperation with the Bureau of the Census, it was determined that there has been a net loss of 6,000 farms in my congressional district since 1951. This means only one thing-the small farmer is being forced out of business and has been selling his acreage to the larger farmer. This can be substantiated by the fact that the average acreage per farm has increased. We have also lost over 25,000 people in the past 5 years who have moved to other sections of the country to find work. I think I have expounded long enough as to our need. The main concern of mine at this time is, "What can we do about it?" I believe it is incumbent upon the Congress to pass some type of distressedareas bill in this session so we may go about the task of stimulating the economy of our communities without further delay. I have read thousands of questionnaires that have been filled out by individuals, organizations, and cities and I am thoroughly convinced that a program designed merely to loan money will not be sufficient to cope with the problem. In addition to loans to communities with which to induce new industry, other things, will be needed-public-works projects such as new highways and streets, city halls, new schools and additions to old ones, improved water and sewage systems, artificial lakes to insure an adequate water supply, increased dredging projects for navigation and flood control and new sources of electrical power. To help carry out some of the aims of area development, I have introduced both H. R. 7902, which was referred to the House Ways and Means Committee, and I might add is similar to S. 2663, introduced by Senator Douglas in the Senate, and H. R. 10472, which is now before your committee. Mr. Chairman, I want to be perfectly frank and honest with you and the members of the committee in stating I do not feel that H. R. 10472 or H. R. 8555 are nearly adequate to cope with this critical problem of distressed areas. My purpose in introducing this proposed legislation, and I am sure it was the purpose of the chairman in introducing his bill, was to have some type of proposal before this committee so hearings could be held and the committee could draft a new bill commensurate with its findings and the need. I would like to invite the committee to study the provisions of H. R. 7902, which I authored and which was referred to the Ways and Means Committee. This bill would make available $100 million for loans to prospective industry and $100 million to much-needed public-works projects. I want to reiterate, loaning money in itself will not be adequate because many areas need public-works improvements projects such as I have mentioned previously in my testimony in order to be acceptable to the industry which might be wanting to locate in a particular community. Mr. Chairman, I do not want to bore the committee with long testimony, as I am sure that each of you understands the serious problem we are facing in southern Illinois, where there is an abundance of unemployment; however, I would like to take just a couple of minutes more and discuss a matter of importance. A few days ago, when I appeared before your committee with Mr. Godfrey Hughes, executive secretary of Southern Illinois, Inc., who gave the committee much valuable testimony, I was interested in some statements made by Mr. Perry M. Shoemaker, president of the Delaware, Lackawanna & Western Railroad Co., who was appearing for the United States Chamber of Commerce and who is opposing the distressed areas bill. In Mr. Shoemaker's statement he infers that, by the Federal Government providing aid to industry to locate in a distressed area, that it would mean taking jobs away from one section and giving them to another. I, of course, cannot speak for the entire United States, but from past experience in locating industry in southern Illinois, this has definitely not been the case. Each plant we have been able to locate in our area has been an expansion of facilities for a manfacturer or has been a new venture entirely. We have the Norge plant of Borg-Warner Corp., the Allen Industries, and Sangamo Electric Co., just to mention a few, and all of these concerns were expansion programs and did not displace one worker in any other section of the country. However, local funds for building buildings and making improvements were needed as an inducement for these companies to expand and locate in southern Illinois. Here is where Federal assistance can be very helpful. Those communities which have been trying very hard on their own to induce new industries can make up a revolving fund with which to donate sites or build a building for some industry; however, after their money has been spent they have to wait a long period before it is repaid. If they were able to borrow money from the Government under the provisions of a distressed areas bill, the funds would be available when needed. Mr. Shoemaker's argument is definitely not based upon fact. I want to point out that, in my opinion, Mr. Shoemaker is definitely not speaking the sentiments of the rank and file of chambers of commerce and their membership when he comes before your committee in the name of the United States Chamber of Commerce's opposing this proposed legislation to aid our unemployed people in this country. Mr. Chairman, on behalf of all the fine people of southern Illinois, may I strongly urge upon you and each member of this committee to take immediate action in an effort to alleviate the unemployment situation existing not only in southern Illinois, but in other economic "sorespots" in this country. We do not ask for handouts, but merely be given some projects and tools with which to work so that we may make our area more attractive to private industry. Legislative action setting up a distressed area administrator with full powers and funds with which to cope with this problem is the only immediate answer. I hope you will see fit to report out the distressed areas bill without further delay. Thank you very kindly for your attention and for this opportunity to testify before this splendid committee. STATEMENT OF HON. JOHN A. BLATNIK, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF MINNESOTA Mr. BLATNIK. Mr. Chairman, I deeply appreciate this opportunity to appear here today and testify on legislation being considered by this committee to assist economically distressed and depressed areas. Chronic unemployment in certain areas of the country is a growing national problem and one which I am happy to see is being given consideration by the Congress. Last January I introduced H. R. 8323, a bill to establish an effective program to alleviate conditions of excessive unemployment in certain economically depressed areas. My bill, together with similar measures introduced by Senator Douglas in the Senate and a number of our colleagues here in the House, is known as the Depressed Areas Act. The bill under consideration here, H. R. 8555, is known as the Area Assistance Act of 1956. Names and titles are not important to us. The important thing is that practically everyone now recognizes the existence of the problem of pocket depressions which constitute a dark spot on the otherwise bright prosperity picture. President Eisenhower in his 1955 Economic Report to the Congress made special reference to this problem and has asked for specific legislation to establish a domestic technicalassistance program to aid the Nation's depressed areas. His legislative recommendations are embodied in H. R. 8555 under consideration here today. I have more than an academic interest in depressed-area legislation. For some time now the Department of Labor has listed the city of Duluth, Minn., which is the largest city in my district, as a surpluslabor area, otherwise known as a depressed area. This situation has existed for over 18 months and there is nothing to indicate that the situation will substantially improve. The problem in my district is that our economy is tied, in the main, to one industry; the mining and shipping of iron ore. This is a seasonal industry. The northern Minnesota winters make mining operations difficult, if not impossible, and from December to March ice is a cork which bottles up navigation on the Great Lakes, making the shipment of iron ore impossible. Because of this situation northern Minnesota's economy fails to expand at a normal rate. There is feverish activity during the spring and summer months during which times are good and employment relatively high. Then there comes a |