But an even more important reason for this transfer of
authority is to place power into the hands of those who are
politically accountable, so that the "community" will have
more control over its government. Political accountability,
however, does not necessarily insure administrative effective-
ness. For this reason manpower reformers may not necessarily
agree with advocates of revenue sharing, and vice versa...
The explicit intent of revenue sharing is to move decision-
making authority to the state and local level. But some
control must be retained. There are cases where federal pri-
orities are obviously contrary to those at the state and local
level. There are certain functions, such as research and
development, that are more effectively performed at the
national level. There are some programs, such as Job Corps,
which may require federal administration. And there must
be some oversight to insure that shared revenues are used for
their intended purposes-that manpower funds are used to
provide manpower services rather than to build housing or
stock ponds. The critical issue is the degree of control which
will be retained. . . . The need for decentralization must
somehow be balanced against the need to maintain federal
priorities.

Another discussion of this issue is contained in the publication, "Special Revenue Sharing for Manpower Training and Employment Programs," published by the American Enterprise Institute headed by Paul W. McCracken, Chairman of the Board, and William J. Baroody, President. This analysis (see appendix for text) states:

Perhaps the most basic argument made for the manpower revenue sharing bill is that by converting existing manpower activities from categorical programs to special revenue sharing, state and local governments will be afforded an opportunity to play a more important role in dealing with their manpower problems. Revenue sharing will encourage policy innovations at the state and local level. State and local governments may experiment with new ways of solving manpower training problems and successful solutions may be adopted by other states and localities.

The key argument made against the administration's proposal is that there is nothing inherently more efficient in state and local operation of manpower programs. Labor unions and antipoverty agencies have expressed fear that state and local governments would be less sensitive to the job needs of minorities of the urban poor.... Critics of the bill cite reported abuses under the federal block grant program which gives state and local officials broad discretion in the use of grants for law enforcement. . . . It is contended by some opponents that the administration's proposal does not do enough to meet the problems of unemployment. The $500 million in additional funds provided for when the rate of unemployment exceeds 4.5% for three consecutive months is viewed by some knowledgeable observors as an unrealistically small amount. It is charged

that several of the major cities with high rates of unem-
ployment would receive less under the proposed manpower
revenue sharing act than they were presently receiving.

5. Categorical Programs

The future of the so-called categorical programs is one of the most controversial issues involved in manpower reform. The existing programs are frequently criticized as in this comment by Professor Levitan in his April 30, 1971, paper:

Operated by a variety of agencies at the federal, state and local level the programs are aimed at differing clienteles and needs, varying in their eligibility standards, benefit levels, application procedures and methods of delivery. . . Because services are fragmented and frequently uncoordinated, clients are often unable to find the assistance they need. Some of these difficulties are the inevitable result of designing and implementing experimental social programs, but many problems result from the underlying philosophy of the manpower efforts the centralization of authority at the federal level. Funding comes with many strings

.

attached and the operating agencies have little flexibility.

The suggestion that efforts be made to coordinate existing categorical programs and supplement them with new, more flexible programs designed at the state and local levels has almost universal support. However, proposals to terminate abruptly the existing categorical programs encounter strong opposition from those benefiting from existing programs and from program sponsors. Concern is expressed that experience gained over the past seven to nine years. may be lost through termination and that many persons needing manpower services will be "turned out on the streets" with no alternative programs available, at least during a lengthy new start-up period. The experience with cutbacks in the Job Corps in 1969 is often cited.

In assessing the categorical program issue it is important to understand the degree of categorization which presently exists.

Many of the existing manpower programs were created by executive order and not by legislation. Examples are the JOBS (Job Opportunities in the Business Sector) program; CEP (Concentrated Employment Program); STEP (Supplemental Training and Employment Program); and special programs announced recently by the Labor Department to serve veterans, migrant workers, and unemployed engineers, scientists and technicians. Furthermore, existing legislation does not earmark funds for the so-called categorical programs. Most of the "categorization" which is so widely deplored is a result of administration and budgetary decisions, not legislation.

Professor Levitan stated in his April 30, 1971, paper that "the potential but unproven benefits of decategorization do not carry a great deal of weight when balanced against the rigid opposition of those involved in existing efforts. Thus, despite its promise, decategorization has practical and political drawbacks which militate against any sudden change in this direction."

Others have suggested that, as a compromise, existing categorical programs be continued "as is" for some stated period of time during

which, presumably, new and more flexible programs designed at the state and local level would be developed and eventually supersede the categorical programs.

Whether existing categorical programs could be replaced by new programs at the state and local level is also an issue. The prime example is the Job Corps, presently operated in about 60 centers nationwide. Some states have as many as three Job Corps centers and others have none. Centers often serve youths from many states, sometimes far removed from the location of the center. There are few Job Corps camps in the southeastern United States. Operation of a Job Corps center is comparatively expensive. Many supporters of the Job Corps contend that "decategorization" of the Job Corps would mean its termination because mayors and governors could not be expected to continue the present Job Corps system, paying for it out of their "manpower revenue sharing" funds. Similar arguments are made about other categorical programs, but the Job Corps is the most frequently cited example.

II. UNEMPLOYMENT DATA