The Coalition Board HONORABLE EDWARD T. BREATHITT Chairman of the Board (former Governor of Kentucky) HONORABLE NORBERT T. TIEMANN President (former Governor of Nebraska) HONORABLE WINTHROP ROCKEFELLER Executive Vice President (former Governor of Arkansas) R. B. PATTESON Treasurer Wachovia Bank & Trust Company, N.A. GLEN JERMSTAD Secretary and Executive Director GEORGE ABSHIER Director, Community and Industry Programs Oklahoma State University JAMES H. ALDREDGE (former President of the National Association of Counties) ROBERTO. ANDERSON Chairman of the Board Atlantic Richfield Company ORIN E. ATKINS President and Chief Executive Officer Ashland Oil, Incorporated HONORABLE JOSEPH W. BARR, JR. (former Secretary, Pennsylvania Department of Community Affairs) HONORABLE DEWEY F. BARTLETT (former Governor of Oklahoma) DR. CHARLES E. BISHOP Chancellor University of Maryland HONORABLE JACK CAMPBELL (former Governor of New Mexico) HONORABLE LOROY COLLINS (former Governor of Florida) DONALD C. COOK Chairman of the Board & President American Electric Power Company, Incorporated DR. LAWRENCE DAVIS President Arkansas A.M. & N. College DR. CLAYTON C. DENMAN President and Co-Director Small Towns Institute HONORABLE FRANK FARRAR (former Governor of South Dakota) HONORABLE ORVILLE L. FREEMAN (former U.S. Secretary of Agriculture) HERMAN GALLEGOS President U.S. Human Resources Corporation G. B. GUNLOGSON Countryside Development Foundation, Incorporated PAUL HALL President Seafarers International Union H. L. HEMBREE, III President Arkansas Best Freight Corporation AARON E. HENRY Clarksdale, Mississippi HONORABLE PHILIP H. HOFF (former Governor of Vermont) W. WILSON KING Kinglore Farms, Incorporated DON F. KIRCHNER President Peoples Trust & Savings Bank HONORABLE HAROLD LOVANDER (former Governor of Minnesota) DR. WINTHROP LIBBY President University of Maine ERNEST T. LINDSEY President Farmland Industries, Incorporated HONORABLE JOHN MCCLAUGHRY Representative Vermont General Assembly HONORABLE ROBERT E. MCNAIR (former Governor of South Carolina) E. W. MUELLER President American Country Life Association KERMIT OVERBY Director, Legislation and Communications Department National Rural Electric Cooperative Association ROBERT B. PAMPLIN Chairman of the Board Georgia-Pacific Corporation CHARLES O. PREJEAN Executive Director Federation of Southern Cooperatives HONORABLE ELVIS J. STAHR President National Audubon Society MILES C. STANLEY President AFL-CIO Appalachian Council JULIUS J. STERN Chairman of the Board Wood County Bank, West Virginia JAMES L. SUNDQUIST Senior Fellow The Brookings Institution THE RIGHT REVEREND MONSIGNOR JOHN GEORGE WEBER Executive Secretary National Catholic Rural Life Conference CHARLES YOUNG President E. F. Young, Jr., Manufacturing Company GORDON ZIMMERMAN Executive Secretary National Association of Conservation Districts Mr. ROCKEFELLER. The Coalition for Rural America has a 50-man board of directors, of which 11 are former governors-I have never been able to find out whether we are six Republicans and five Democrats, but we are a balanced board, which includes these governors of States. It is bipartisan, it is non-partisan. The other members of this board are representative of industry, labor, farm, private interests and ordinary citizens concerned with the quality of life in rural America. Our membership will be representative of all segments of rural America. Although we have been in existence only a very short time, the response to our efforts and proposals throughout the Nation has been tremendously encouraging. I believe that examination of the working paper entitled "Why a Coalition for Rural America," which I have just tendered into the record, and you have been so kind as to accept as part of the record, will tell you a little bit more of the philosophic attitudes about why the Coalition for Rural America. Also I believe that the examination of that working paper will establish that our central concern of the Coalition for Rural America closely parallels that of this subcommittee in its continuing concern with the problems of this Nation, as evidenced particularly by its hearings and report, in 1967 and 1968, on small business in smaller cities and towns; and again by the committee's hearings in 1970 on rural and urban problems of small businessmen. Mr. Chairman, you are to be commended for pursuing this inquiry at a time when maybe some people are faulted. But you are giving the leadership to solving what I believe is one of the most important of our domestic problems. I should like to make clear that the Coalition for Rural America vigorously and enthusiastically supports the proposed 7 percent tax credit for industries locating in rural America, as proposed in House resolutions introduced by Chairman Evins and others before the 92d Congress. Indeed, the Coalition's preliminary statement of goals and objectives adopted in September, 1971, states specifically: In the consideration of President Nixon's proposals for establishment of an investment tax credit, we will support amendments that will provide a differential in favor of enterprises that locate in rural areas and increase employment of residents of areas where located, including the chronically underemployed and unemployed. The Coalition for Rural America earnestly supports the assertion made by Chairman Evins when, in introducing the Rural Development Incentive Act of 1971, he described an urgent need for programs to encourage greater development of our free enterprise system in our small towns and rural areas. To this we would add the strong belief that, along with new jobs and employment opportunities, Americans who choose to live in rural areas should have the opportunity to secure ownership of productive private property so that they too may accumulate an estate, enhance the local tax base and be secure in their own lives. Evidence is accumulating that the Nation is commencing to turn its attention to the development of rural America. The present configuration of Federal undertakings is once again being reviewed with an eye toward reorganization of those agencies which administer the many categorical assistance programs designed to assist the rural areas of this country. A variety of plans for altering the present governmental delivery systems is being developed. Several new and different ap proaches for financing Federal Government services are being proposed. We all recognize that functional efficiency at the Federal level to develop rural areas is surely needed, but this must be matched by increased local capabilities, State responsibilities and regional flexibility and particularly planning. The Coalition for Rural America intends to examine very carefully these various proposals and evaluate them in light of an appropriate future role for rural America, and the larger American society into which we shall all evolve. These various proposals must be closely examined in order to determine they are not mere cosmetic changes in organization charts of Federal agencies. They must be examined in terms of the fact that they are going to be permanent. So when we talk about Federal programs, we must not be talking about fool's gold; we must be talking about that which will create a strong rural America. We assert the need for a national commitment to develop the rural areas of this country. We do so in the belief that rural America should present to every American citizen a viable alternative-you will find one when my brother testifies. I believe we can present this viable alternative which every American citizen can choose in pursuing his private interests, his family concerns, and his personal life style. We believe that this national commitment should embody at a minimum a national policy statement and appropriate Federal programs to implement that policy over the next decades. I will not here burden the record with a reiteration of the long lists of present deficiencies in housing, health services, education, economic opportunity, and quality of life with which the rural areas of this Nation are afflicted. These statistics are depressingly familiar to us all. Still by no means can the true quality of life be measured by application of mathematical ratios or statistical profiles. Life, like the environment that the ecologists describe to us, is all of a piece and contains subtleties not reducible to mathematical formulas. The Coalition for Rural America believes that a national commitment to rural development must go beyond policy statement and governmental programs, and extend itself into the very lives of the individuals who, in increasing numbers, are seeking their destiny in nonmetropolitan areas of this Nation. I am going to repeat there that it relates to the lives of people, not to formulas. There is some evidence for the proposition that rural-to-metropolitan migration is waning. For this, I am happy. The 1970 census data indicates that outmigration from rural communities slowed from 4.6 million during the 1950's to 2.4 million during the 1960's. Most of the population losses during the past decade were in the Great Plains and certain mountainous areas of the Far West. At the same time, population gains were being realized in the southeastern quadrant of the United States, eastern Oklahoma and northern and western Arkansas. I am happy to say that my neighboring State of Oklahoma and Arkansas have a gain. This information offers a potential blessing, if you will. It indicates that the tide of migration is changing, or maybe reversing in some instances. But unfortunately, we do not know the reasons why: Why are people moving, why are they not? That is why, Mr. Chairman, I am so glad that you are getting people together to talk about this particular thing. The Coalition for Rural America believes that a serious and sustaining research effort should be aimed at determining some of the critical information upon which any realistic national commitment and programs must be based. We wish to know, for example, much more than we now know about those individuals who moved in the 1960's and why? What were they seeking when they moved? What did they find after they resettled? We feel it is imperative to know factors involved in their personal decisions as they sought new opportunities, new jobs, new homes in other areas of the Nation where they had not lived previously. With such information it is reasonable to anticipate that we can discover the motivating influences upon which meaningful public and private programs can be based. This committee has concerned itself with another major factor in the economic development of rural areas-venture capital. Indeed, the creation and expansion of rural small business often is directly affected either favorably or unfavorably by the availability of development capital. Your pending legislation looks toward inducing private investment to the larger task of rural development. The Coalition for Rural American believes that we need to know much about the availability, the flow, the magnitude and management of investment capital inside the United States, thus to determine how and to what extent the present capital circulation system can be utilized to the large social task of economic development of rural America. Many studies reflect the availability of total investment capital, both public and private, but seldom is a study of capital flow related to geographic areas in the Nation. We would hope to interest this committee in concerning itself with these problems of research, particularly with regard to the need and availability of investment and development capital in rural America. While the Coalition for Rural America is too young to have developed a comprehensive program to recommend to the Congress and to the Nation, we do have sufficient insight into some of the problems of rural areas, the programs which the Federal Government now operates, and proposals now pending to suggest certain aspects which might be profitably explored by this committee. Regretably, we are not here to give you all of the answers. But we do have the insight, I believe, in developing certain aspects. This committee might well examine the possibility of expanding some of the existing Federal programs which relate most clearly to economic development of rural areas, specifically the so-called 502 program of the Small Business Act. The apparent success of the local development company vehicle under the 502 program suggests the possibility for a vital counterpart vehicle. The local development company and the 502 program provide soft loan money to be used for acquisition of new plants and equipment for rural industries. Too often, however, we have seen that this is not enough to assure creation or expansion of small business in rural areas. There is also the vital need for working capital. This committee should explore the possibility of legislation authorizing local investment companies as counterparts to local development companies as a new source of working capital for rural small business development and ultimately, equity ownership. The almost unqualified success of the Federal guarantee program further suggests that such local investment companies should be backed by Federal guarantees. These local investment companies, like their |