The CHAIRMAN. Class conscious?

Mr. EDELMAN. Exactly and that is a very frequent situation that you will discover here.

The CHAIRMAN. That is a part of human nature.

Mr. EDELMAN. That is part of human nature, sir, but ultimately there will have to be an effort made under the leadership of the Federal Government to cooperate with States, local governments, to remove of course this type of restriction, and we feel very strongly, sir, that if some investigation is made here, formerly by the Congress that that whole problem should be included within the purview of this investigation, to highlight it and ultimately bring about some changes. Just let me say one final question.

We said last year that these mutuals, these nonprofit type of developments, would develop rapidly, that they would come up and they would offer their, as it were, volunteer leadership, their volunteer services to help meet the needs of this situation, and to relieve the Government, so to speak, of any obligation to meet that problem if we were met with these slightly relaxed financial features.

We can tell you, sir, that there has been an enormous expansion of interest in that field, that we now have groups in virtually every important community in the United States, not merely composed of that, say, of CIO people, but a cross section of consumers and CIO members.

We are very much interested in undertaking, particularly these veteran groups, at this time, for housing. A number of projects have been undertaken, of that description.

The CHAIRMAN. You agree with me, do you, that there is a great field for help to mankind in the housing problem through cooperative housing units?

Mr. EDELMAN. We have been preaching that, sir, for 12 years. And just to say why this 1 percent is needed, we find, to put it into a concrete nutshell, in my project at Front Royal-when I say "my project," I happened to be chairman of the corporation, my union asked me to undertake this, a nonprofit development for a group of rayon workers; we could not man a plant which was a high priority war plant, for tire fabric. Senator Maybank might jump on me for treachery to cotton, but the fact is that we were faced with that requirement. We could not man the plant with the type of housing in the community. We had to do something about it.

We tried to break the bottleneck by undertaking to demonstrate something ourselves.

Many of the workers, even before we had a corporation established, before we had any organization whatsoever, the workers that were there that had worked a while, most of the workers in that plant were new people that had no savings, they were people who were brought from the rural districts. They were brought in there. Anybody who had a few dollars was willing to gamble.

We got the work done, hired the technicians, lawyers, engineers. We got the whole thing cleared, up to the point where the FHA said to us, "Now, everything is set; our commitment goes into effect, but where is your money for development? You have to have some capital to work with. You have to have some capital here to get along with." And at that point we were completely stuck, sir. We were completely licked.

The CHAIRMAN. Am I right or wrong that in the Government set-up for aiding projects like this there is a field where loans can be made to people on a corporate basis?

Mr. EDELMAN. Under the present circumstances, none whatsoever. The CHAIRMAN. You are quite certain of that?

Mr. EDELMAN. I am quite certain of that. What you really do is get the conventional type of payment to the contractors under the FHA type of financing.

Now, bankers, we found, sir, are very willing to go far beyond what FHA requires of them, to advance us funds, but under no circumstances can we, under present circumstances-the time schedule does not permit them to give us advance loans.

We had to go out to our own local unions. We had to run to our local unions throughout the country and borrow money from them, which was not a good thing to do.

The CHAIRMAN. Here is a committee sitting on a very complicated. subject, you will agree.

Mr. EDELMAN. Yes, sir.

The CHAIRMAN. It has many shades, and things we do not understand. We are searching for wisdom and you men are attempting to supply it to us. We all know there is a shortage. We all desire to be helpful. We may differ about the modus operandi.

We have a lot of people who, the most important thing in the world, are suffering for lack of housing. There are a lot of torpedoes in the way, so to speak. You have stated some. Others have cited some. My own philosophy, speaking for myself, is that we have to have the philosophy of Farragut in Mobile Bay, "Damn the torpedoes! Full speed ahead!"

Speaking for myself, it is possible to bring order out of chaos if we do that. Back of it I see people, the most important thing in the world. It is not a system of government or banking, but it is housing for people. We cannot give them homes. That is something they have to do. But we can give them housing. As Edgar Albert Guest said, "It takes a heap of living in a house to make it home."

I do not know how this will wind up. But speaking for myself, this is a heart-burning project. It is a tough one. The objective is housing for people, and it is not much of a country if people cannot find places in which to live, decent places in which to live.

Mr. NICHOLAS. Mr. Chairman, the CIO commends the position you take.

The CHAIRMAN. It is my purpose and my heart.

Mr. NICHOLAS. It is my sincere hope that that same view will be taken by Congress.

Mr. EDELMAN. Senator, this little saying that is now going around might interest this committee. I notice that somebody mentioned it to me the other day: "Have you heard about this housing shortage?" And the answer was, "Housing shortage? What is that?" The reply was, "There is a rumor, sir, if you please, started by people who have no place to live."

The CHAIRMAN. That is a fundamental source, is it not?

Mr. EDELMAN. Yes, sir.

The CHAIRMAN. We will call to the stand Mr. Edward Weinfeld, of the National Public Housing Conference.

99279-47-15

STATEMENT OF EDWARD WEINFELD, APPEARING FOR NATIONAL PUBLIC HOUSING CONFERENCE, WASHINGTON, D. C.

Mr. WEINFELD. My name is Edward Weinfeld. I am appearing here as chairman of the legislative committee of the National Public Housing Conference. I was formerly the State commissioner of housing in New York State.

Mr. William J. Guste, president of the National Public Housing Conference, testified before this committee in support of S. 1592, Seventy-ninth Congress. His testimony will be found on pages 643-659, part 2 of the printed hearings. Since the National Public Housing Conference likewise is supporting S. 866, in the interest of conserving time let me say that to the extent provisions of S. 1592 are in S. 866, the conference offers, by reference, Mr. Guste's testimony. As chairman of National Public Housing Conference's legislative committee, I should like very briefly to comment on one or two provisions of S. 866.

First, we believe the creation of a National Housing Commission-as provided in title II-is not as effective, administratively, as the permanent National Housing Agency provided for in S. 1592. We are of the opinion that the diversified character of the Federal Government's far-flung housing activities requires a top-level agency with an administrator possessed of policy-making functions. The technique employed in S. 866, of a National Housing Commission consisting of an Administrator, Coordinating Council, and a staff, strikes us as being a weak and halfway measure. A glance at the functions of the Administrator to develop, to collaborate, to interpret, to coordinate, to recommend, to prepare, to preside-indicates the powerless character of the Administrator.

Such an organization leaves the FHLBA, the FHA, and the FPHA as dangling independent agencies. Such an organization is in direct conflict with the recommendations of the Taft committee report. Such an organization is quite inconsistent with the unanimous report of this committee when it reported out S. 1592.

We urge you, in your deliberations on this bill, to review the arguments in favor of a permanent National Housing Agency with constituent members, as opposed to the paper type of organization provided for in title II of S. 866.

The CHAIRMAN. May I interrupt you there? You pointed out the old bill and the new bill. The hearings on this piece of legislation, S. 866, are of necessity much more brief than they were a year ago. That is a comprehensive series of hearings, and they covered this whole subject matter in those hearings. The printed records are available to this committee now.

So we have considered, and I think justly and wisely, that we will take up particularly what you are doing now, the changes in the bill, and contrast those, rather than go into the whole matter of the subject matter brought out in S. 1592. So it will be no lack of interest or understanding of housing propositions as a whole, by virtue of the fact that we are conscious of the changes.

I think you will approve of that.

Mr. WEINFELD. We not only approve of that, we are in agreement with it. It is for that very reason that we have not gone into the entire housing picture, and the need for a general housing bill, and are

confining ourselves to the specific changes and giving you our comment on that.

The CHAIRMAN. I appreciate that. I merely spoke this way for the sake of the audience in the room as well. Some people may say, "You are not holding very lengthy hearings." We are holding just as lengthy hearings as it is necessary to hold for these changes, plus the information we have in the hearings on S. 1592.

Mr. WEINFELD. We understand that thoroughly. That goes back · to the fact there was a Postwar Committee on Economic Planning which itself conducted very extensive hearings before S. 1592 was introduced. There was a full review of the facts in the picture, so far as the needs for a total housing program was concerned.

I would, on this very first point, if I may, like to emphasize that on the basis of, 1, my own personal experience, and 2, on demonstrated experience on the part of the Federal Government itself.

Number 1, I mentioned, and you will forgive the reference to it, the fact that I was the first commissioner of housing in New York. It is the only State in the country which has a State-aided program which parallels Federal activity as far as aid for low-rent families and slum clearance is concerned.

That program was inaugurated with a $300,000,000 fund. It was a fund of that size at the time. The national program, as I understand it, encompassed $800,000,000 for an entire country.

I was confronted in the beginning with this very problem as to whether or not an administrator was to have control and direction of the policy of the program, but always, of course, within the framework of the legislative act, and of course in this case it would be the legislative policy as determined by the Congress.

From time to time we encountered some very difficult problems of policy. That was through necessity, because at the time that program was inaugurated in 1939 there was little actual experience as far as housing functioning by Government itself, through financial aid, was concerned. USHA had been in existence a very short period of time. In effect we were pioneering in a new field, and there were very few actual guides or precedents to which the administrator might turn.

Hence, when these difficult problems came up it was my policy to call in, as I believe it would be the policy of any sound administrator, those men who, through long experience, had some contribution to offer to the solution of the problem. And that would mean calling in, incidentally, every point of view, opposite points of view, extreme points of view, and if you please, perhaps more balanced points of view.

Out of these conferences with these different men each reflecting his own point of view, policy was determined by the one man who had the responsibility for determining it- that was the State commissioner.

I do not have the slightest doubt that in the discussions which took place, where men pressed their individual points of view, frequently not seeing eye to eye with other men in the room, that they left that conference convinced that whatever the decision the administration, rather, the administrator was going to make, would undoubtedly be the wrong decision. I dare say there were probably very few men who felt he made the right decision.

But the significance of that kind of set-up is this: You center responsibility upon one man, and as was put by a previous speaker, if, in the determination of policy, or if, in the administration of policy, there is something that does not meet the requirements of the Congress, the Congress knows where to go to assess the blame, or perhaps to give credit where credit is due.

The CHAIRMAN. It eliminates the opportunity to pass the buck.

Mr. WEINFELD. Exactly. Now, in the set-up that you have here you are dividing the responsibility. You have, as I recall it, some seven or eight men who were called upon as an advisory coordinating commission, the National Housing Commission, each, perhaps, reflecting a different point of view.

I think the ultimate result of that kind of a set-up will be that you do not get sound or fixed policy, you do not center responsibility upon one man, you make it possible there to develop a compromise policy.

What do I mean by that specifically? I think this whole bill has, as its genesis, the idea that what is required in this country is not a housing program for the low-income group, not a housing program for the low-middle-income group, not a housing program for the middleincome group, not a program of slum clearance or reclamation, but one unified program that represents the totality of our housing problem in this country. That is the basic purpose of the bill as I have always understood it.

Now, if in setting up your administrative procedure, you permit representatives of Government, no matter how sincere they are, to represent the particular parochial attitudes that are often reflected by a group who believe, for example, that the complete emphasis should be on low-rent housing, or that it should be on FHA housing, you are immediately, in my judgment, destroying the very purpose that in part gave birth to this bill, and that was that there be a comprehensive housing program which has, for its ultimate objective, a decent home for every American family.

Actually you have had Federal experience to indicate that that kind of diverse attitude on the part of governmental officials charged with this program just does not work. It was that kind of a situation which in my opinion led to the Executive order which established the National Housing Agency, and a recognition that it was a total problem, and just to turn back the pages a few years:

You had a United States Housing Authority, carrying on its activities with complete emphasis on low rent housing and slum clearance. You had the Federal Housing Administration, carrying on a different level of activity.

At another point you had the Defense Housing Coordinator. At another point you had the Federal Work Administration. Actually at the time the Executive order was issued you had 16 different agencies, and with the utmost of respect to the men who headed those agencies, each was vying for a position which would give emphasis to the particular kind of housing activity he believed in.

I say if housing is a total picture, as I believe the Senate has indicated in the past it is, and I think few will quarrel with that, you need an administrator who has a balanced sense of judgment, that takes into account every aspect of the housing program of this country. And of course its importance is not alone the housing, but on the national economy.