I think it is a sin that we close, in our great cities, museums 2 and 3 days a week because we lack wherewithal to hire auxiliary guards to keep the museums opened.

There are so many things to be done in health care, education, public safety, clean streets, better parks and forests, better transportation, that I think it is just wicked that we allow 5.4 million unemployed to get frustrated and lose faith in the future of our country.

Those people want to work rather than squander money on welfare and unemployment compensation. Why don't we provide jobs?

I wish I could say that the administration supports our "Jobs Now" proposal; that, to be perfectly honest, would be an overstatement. The President called similar jobs a year or so ago "a dead end." Just the last few weeks before the Joint Economic Committee, Mr. Stein, the Chairman of the Council of Economic Advisers, has denounced the program as "a WPA"; and Treasury Secretary Connally opposes it. He says:

We are not going to propose it. We are not going to support it. It is the philosophy of this administration that it is the primary responsibility of the private sector to provide jobs in the United States, and that this Government ought not to adopt the attitude that it is the responsibility of the Federal Government to hire all of the people who don't have jobs in this country.

Secretary of Labor Hodgson, on February 17, spoke to the same effect.

Well, the administration obviously does not favor direct methods of job creation. But one might ask: What is the administration's program?

Well, so far as one can tell, it is largely projecting the greatest peacetime budget deficit in history, $39 billion this year, as Economic Council Chairman Stein bragged last week in a speech before the National Press Club. He said: "We are running the biggest budget deficit ever, except for World War II."

Somebody ought to tell Mr. Stein that this is John Maynard Keynes vulgarized. Nobody, until he came along, ever suggested that the mere size of the deficit, the mere horrendous, atrocious amount of it, was the measure of economic wisdom.

The measure of economic wisdom is, as far as a deficit goes, if you are running one, mainly whether that money spent and that tax policy are conducive to the largest possible number of jobs.

That is why I say that a trickle-down program like the investment tax credit, at a time when 73 percent of the plant and equipment in this country is not being used anyway, simply does not get down to the job of finding equal jobs.

By and large, workers in those capital goods industries are not the kind of workers who are now having the principal trouble getting jobs. The principal type of people who are having trouble getting jobs are the young, the women, the less-skilled, the less-educated, and the less-motivated.

So, even if trickle-down methods could, by some accident, lead to a few more jobs, this is small consolation to the 5.4 million, the great mass of unemployed, who would be left high and dry by such a program.

Contrarily, a 500,000-man and women "jobs now" program would immediately put to work one-tenth of the unemployed, 500,000 of the 5 million unemployed, but that is not all. According to every approved

method of economic calculation, the real economic effect would be something like this:

All right, 500,000 jobs immediately-that is one-tenth of the unemployed. The money that would be spent by somebody who is now unemployed but tomorrow is making $7,000 or so a year, that money would almost all be spent. None would be saved, because these people desperately need goods and services.

Well, the spending of that money would create at least a million extra jobs, making the goods and services that this new-found market demands. So, 500,000 and 1 million-that is a million and a half; and in addition you would get about 200,000 jobs in the capital goods industries making the tools and equipment for this new group-1,700,000. And then if you look at the 80 million people in this country who, thank heavens, do have jobs but are now saving a record-breaking 8 percent of this income because they see the fellow down the street without a job and so they put off their purchases, that group would, in our judgment, somewhat increase its propensity to spend and consume. That would easily add another 300,000 or 400,000 jobs, so this projection is right, and I believe it is conservative and right. We would put dent in unemployment by getting jobs for close to 22 million new people, and thus reduce the heartbreaking 6-percent unemployment rate to a more manageable 3-percent unemployment rate, which certainly should be the object of the game.

I wrote, within the last few months, to all of the Nation's leading economists, asking them for their views on the "500,000 jobs now" program. I am pleased to report an almost universal approval of the plan from conservatives like Prof. William Fellner of Yale to liberals like Prof. Gardner Ackley of the University of Michigan.

I would like, with the Chair's consent, to introduce into the record the complete text of those letters, more than 20 in number, plus an additional two letters which I have just received in the last day or two, one from Prof. George Perry of the Brookings Institution, and one from Seymour Wolfbein of Temple University's School of Business Administration.

Mr. DANIELS. Without objection, the letters will be inserted in the record.

Mr. REUSS. Thank you, Mr. Chairman. (The letters referred to follow :)

THE BROOKINGS INSTITUTION, Washington, D.C., February 18, 1972.

Hon. HENRY S. REUSS,

House of Representatives,

Washington, D.C.

DEAR MR. REUSS: Persistent high unemployment is a serious economic problem today. And while unemployment is unacceptably high throughout the economy, the problem is especially severe for certain groups of workers. The young, the black, the less skilled and the less educated all experience exceptionally high unemployment rates. I am glad to support H.R. 12011; it is the kind of bill that is needed to deal with these problems.

Even if the 6 percent growth rate now predicted by the Administration for 1972 could be sustained for as long as necessary, it would take two full years of expansion to get the overall unemployment rate noticeably below 5 percent, and a third year to get it near 4 percent. By focusing directly on job creation, H.R. 12011 could speed this return to high employment levels. Even more important, a conventional expansion of jobs would still leave us with the large

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disparities in unemployment rates that we have witnessed in recent years. The groups experiencing relatively high unemployment would continue to do so. And as overall unemployment dropped, some job markets would be growing tight, making it more difficult to contain new inflationary forces, while others would still exhibit clearly excessive unemployment. By focusing on providing jobs for those groups of workers whose unemployment experience in the private job market is particularly bad, H.R. 12011 would help expand employment in a way that minimized any renewal of inflationary forces.

Combining full employment for all with price stability is a great challenge facing domestic economic policy today. Not only is H.R. 12011 a promising measure for helping us do this at present, but I would hope that out of our experience with the program, we could learn how to direct its employment effects so as to serve this purpose increasingly well in future years. Sincerely yours,

Hon. HENRY S. REUSS,

House of Representatives,

GEORGE L. PERRY,
Senior Fellow.

TEMPLE UNIVERSITY,

SCHOOL OF BUSINESS ADMINISTRATION,
Philadelphia, Pa., February 16, 1972.

Rayburn House Office Building, Washington, D.C.

DEAR CONGRESSMAN REUSS: I am taking the occasion to reply to your recent letter regarding your proposed legislation to expand the number of federally financed public service jobs.

I am in accord with the effort you and your colleagues in the Congress are making in this regard for two basic reasons:

First, there is just about unanimous agreement by all the experts in this field, including the current Council of Economic Advisors, that the prognosis for the year ahead is for continuing relatively high levels and rates of unemployment. The materials on this point are already copious and I realize that you do not need any additional evidence on this matter.

The second, and one which I do not think has received sufficient emphasis, lies in the fact that we need some specific, viable pathway where the millions of persons now on welfare can use to move into gainful employment. As I indicated in my testimony on HR 1 before the Senate Finance Committee (January 27, 1972) if we really believe that there is a significant number of welfare recipients who will respond to the availability of meaningful employment at decent pay then we ought to put resources not only into their training; we should not only provide adequate child care for children in AFDC families without charge when the adult participates in a job training or employment program; we should also insure that there is a job at the end of the training rainbow-and we can do it by providing public service jobs when private employment opportunities are not available. This could even include part time public service employment-especially in community betterment jobs-for those who cannot move completely off welfare rolls.

The provision of an adequate supply of public service employment opportunity, properly safeguarded so that the jobs would result in a wide spectrum of public services which are badly needed and which would at the same time be worthwhile to the people involved, would thus provide a vital one-two punch: It would be responsive to short term needs represented by current and anticipated unemployment; it would address itself to the longer-range needs of providing a significant dent in the welfare problem, with potentially incalculable advantages to the coming generation of workers.

Perhaps another way of putting this is that the kind of public service employment program envisioned is an excellent blend of social and economic policy as well.

Sincerely yours,

SEYMOUR L. WOLFBEIN, Dean.

ECONOMISTS ENDORSE "JOBS Now" PROGRAM TO PROVIDE 500,000 PUBLIC SERVICE

JOBS

The Speaker pro tempore. Under a previous order of the House, the gentleman from Wisconsin (Mr. Reuss) is recognized for 30 minutes.

Mr. REUSS. Mr. Speaker, on December 2, 1971, I introduced legislation, H.R. 12011, that would create 500,000 federally-financed public service jobs by amending and expanding the Emergency Employment Act of 1971-to Congressional Record, p. H11742. This legislation is cosponsored by 60 Democratic Congressmen, and is being introduced in the Senate today by Senator Walter Mondale and 20 other Democratic Senators. The 60 House cosponsors are:

LIST OF COSPONSORS

James Abourezk (S. Dak.), Brock Adams (Wash.), Les Aspin (Wis.), Herman Badillo (N.Y.), Nick Begich (Alaska), Jonathan B. Bingham (N.Y.), Edward P. Boland, Mass.), Frank J. Brasco (N.Y.), Phillip Burton (Calif.), Hugh L. Carey (N.Y.), Charles J. Carney (Ohio).

Frank M. Clark (Pa.), George W. Collins (Ill.), William R. Cotter (Conn.), George E. Danielson (Calif.), Ronald V. Dellums (Calif.), Robert F. Drinan (Mass.), Thaddeus J. Dulski (N.Y.), Don Edwards (Calif.), Joshua Eilberg (Pa.), Walter E. Fauntroy (D.C.).

William D. Ford (Mich.), Donald M. Fraser (Minn.), Sam Gibbons (Fla.), Ella T. Grasso (Conn.), William J. Green (Pa.), Richard T. Hanna (Calif.), Michael Harrington (Mass.), William D. Hathaway (Maine), Ken Hechler (W. Va.), Henry Helstoski (N.J.).

Joseph E. Karth (Minn.), Peter N. Kyros (Maine), Robert L. Leggett (Calif.), Romano L. Mazzoli (Ky.), Lloyd Meeds (Wash.), Ralph H. Metcalfe (Ill.), Abner J. Mikva (Ill.), Parren J. Mitchell (Md.), Morgan F. Murphy (Ill.), David R. Obey (Wis.).

Edward J. Patten (N.J.), Claude Pepper (Fla.), Bertram L. Podell (N.Y.), Melvin Price (Ill.), Charles B. Rangel (N.Y.), Peter W. Rodino, Jr. (N.J.), Robert A. Roe (N.J.), Benjamin S. Rosenthal (N.Y.), Edward R. Roybal (Calif.), William F. Ryan (N.Y.).

Fernand J. St Germain (R.I.), Paul S. Sarbanes (Md.), John F. Seiberling (Ohio), B. F. Sisk (Calif.), Louis Stokes (Ohio), Frank Thompson, Jr. (N.J.), Robert O. Tiernan (R.I.), Charles A. Vanik (Ohio), Jerome R. Waldie (Calif.), Lester L. Wolff (N.Y.).

On December 6, I wrote to a number of eminent economists seeking their views on the economic merits of this "Jobs Now" program, and asking their suggestions for possible changes and improvements in the bill.

The response thus far has been encouraging.

From Professor James Tobin of Yale University, a member of the President's Council of Economic Advisers during the Kennedy administration:

"I am very much in favor of your proposal for 500,000 federally financed public service jobs."

From Professor R. A. Gordon of the University of California at Berkeley; "I fully support your amendments to the Emergency Employment Act of 1971."

From Dr. Sar A. Levitan, director of the Center for Manpower Policy Studies at George Washington University:

"I believe that the proposed amendments of the Emergency Employment Act are grounded in impeccable logic and sound economics."

From Professor Robert M. Solow of MIT:

"I am glad to endorse H.R. 12011 as an effective means to create badly needed jobs."

From Robert R. Nathan :

"I believe that such a program is highly desirable and fully merited on a number of grounds."

From Garth L. Mangum of the Center for Manpower Policy Studies at George Washington:

"I would be happy to endorse an expansion of the public service employment provided under the Emergency Employment Act of 1971."

From V. Lewis Bassie, director of the Bureau of Economic and Business Research at the University of Illinois:

"I believe this proposal has a great deal of merit and favor it."

From Prof. Lester Thurow of MIT:

"I think that the idea of a public service jobs program is a good idea that can be used as an anti-recessionary weapon."

From Prof. Otto Eckstein of Harvard, a member of the Council of Economic Advisers during the Johnson administration:

"Under the present circumstances, it is only common sense to try to put together a program which would use federal money to hire some of the unemployed to help the quality and quantity of public services provided by the states and localities."

From Prof. Robert Eisner of Northwestern University:

"I can report general sympathy with the proposal to create additional federally financed public service jobs."

From Prof. Gardner Ackley of the University of Michigan, Chairman of the Council of Economic Advisers in the Johnson Administration:

"I . . . favor measures which will quickly and directly increase employment, and yours is such a proposal."

PRESENT POLICIES UNLIKELY TO REDUCE EMPLOYMENT

Most of these economists made the point that present policies and programs, including the current token 130,000 job, public service jobs program, will not be enough to reduce unemployment significantly.

Professor Tobin:

"In my opinion unemployment is the most serious economic problem now facing the country, and even the most optimistic forecasts for 1972 do not contemplate substantial improvement in the rate of unemployment."

Professor Gordon:

"Given the Administration's present game plan, few economists expect unemployment to be as low as 5 percent by the end of 1972. The consensus among 76 forecasts by business, government, labor, and academic economists puts the unemployment rate at 5.3 percent in the fourth quarter of 1972, and the average rate for the entire year 5.5 percent."

Professor Eckstein:

"It is alreay evident that a major unemployment problem will still exist a year from now, and our projections indicate that even in 1973 there will be too much unemployment."

Professor Ackley:

"My own present forecast is that the rate of unemployment, based on present and expected Federal policies, is unlikely to fall much below 5% percent by the end of 1972. I regard this prospect as unacceptable and, indeed, socially dangerous."

Professor Solow:

"I fully agree that the Administration's economic program to date is insufficiently expansionary, and will leave us with a hangover of excessive unemployment at least into 1973. The Emergency Employment Act of 1971 is obviously utterly inadequate to the problem."

Professor Eisner:

"I consider the current rate of unemployment, still as high as 6% by last reports, a major failure of our economic policy. It is indeed a much more important failure than the rate of inflation which has apparently been the major concern of the Nixon Administration. Unemployment means a real loss in current output and untold further losses in destroyed human capital.

"The Administration's presumed efforts to meet the problem of unemploy ment have consisted overwhelmingly of long run tilting of the tax program in favor of business and hence the generally wealthy owners of business. The equipment tax credit is quite misnamed as a job development credit, will do little to relieve short run problems of unemployment and in the long run may even be counterproductive. Similarly, the asset depreciation range revision of our tax laws will mean billions of dollars of lower business taxes and hence higher earnings and capital gains to stockholders but relatively little for capital expansion and even less for employment.”

Professor Bassie:

"There is an immediate need for reducing unemployment and nothing in the present situation indicates that this need will be taken care of automatically by other programs. An unemployment rate of six percent is far too high, and I think that attempts to justify it on the basis that the teenagers, women, and other unemployed workers are not qualified for available employment are shocking rationalizations.

"Unemployment is not likely to decrease as a result of general economic developments in 1972. Business prospects are not favorable. On the contrary, we shall probably experience the same sickly economic performance this year as 'ast."

Mr. Nathan: