services by the Federal Government shall be directed, rather than permittted, from suppliers in areas of economic distress.

No. 7-We endorse the ideas of supplementary unemployment compensation payments and the distribution of surplus foods, but feel that they are temporary measures for the alleviation of individual distress and contribute little toward the solution of the basic problem of unemployment.

Now, the provisions of S. 2663 reviewed above, plus the economicaid program of the Commonwealth of Pennsylvania for relief of distressed areas, hold promise of substantial help, and Fayette County is going to welcome this help.

But in closing, I would like to reemphasize that we in Fayette County are fully aware of our problems and responsibilities and feel that we are making progress in the long-term solution of these problems.

I appreciate the opportunity you have given me to express the opinions of the council on the Douglas distressed areas bill. Perhaps some of our suggestions must await the emergence of a distressed areas administration when they will be spelled out in operating an administrative policy, but other suggestions, if accepted, would require amendments to S. 2663 as it is now written.

Thank you again for this opportunity to express our views.
Senator NEELY. Thank you.

Off the record.

(Discussion off the record.)

Senator NEELY. The reporter is requested to insert at this point in the record the following telegram which has just been delivered to me from the distinguished Congressman Van Zandt.

It is addressed to me.

(The telegram referred to follows:)

Regret my inability at this time to join you again in studying the unemployment problem in certain areas of Pennsylvania. You will recall that last year in my testimony before the Neely subcommittee at Altoona, and later before the same committee in Washington, I gave detailed information regarding the unemployment situation in central Pennsylvania, which was corroborated by over a score of other witnesses.

Since the Altoona hearing held at my request by your committee last year, according to the United States Department of Labor, economic conditions in my congressional district have shown marked improvement as unemployment has dropped from 18 percent to slightly less than 6 percent.

This information and all other available information was furnished the Douglas subcommittee of the United States Senate when I recently appeared before it here in Washington and testified in support of legislation for labor surplus areas which I feel should be enacted as permanent legislation to guard against a repetition of the unemployment experienced the past several years, particularly in the coal and railroad industries.

Improvement in economic conditions in my congressional district stems from upturn of business in coal and railroad industries, as well as new industries which have resulted from community effort to diversify industrial economy of the area.

In addition to the support I am giving the Senate legislation on the subject, I am endeavoring to secure hearings on similar legislation in the House, including my own bill. Favorable action on the part of both Houses of Congress, in my opinion, is justified at the earliest possible date.

Kindest personal regards,

JAMES E. Van Zandt,
Member of Congress.

We thank Congressman Van Zandt, and are sorry that he could not be with us today.

Mr. SAYLOR. Mr. Chairman, at this time I would like to ask permission that Cecil Leberknight, who is the president of the Cambria County Association of Boroughs, be permitted to just make a short

statement.

Senator NEELY. All right. Mr. Leberknight, please proceed. STATMENT OF CECIL K. LEBERKNIGHT, PRESIDENT, CAMBRIA COUNTY BOROUGHS ASSOCIATION

Mr. LEBERKNIGHT. Senator Neely, Congressman Saylor, gentlemen: My remarks will be brief. I have no prepared statement other than this:

I am Cecil Leberknight, president, Cambria County Boroughs Association.

Corroborating much of the testimony that has been given thus far, all I can say is I am reminded of my days in high school playing football. When we got up against an opponent that was just about too much for us to handle, and possibly a tie score, and it was very late in the game, we used to get in a huddle. We said a little prayer to this effect: "Lord, we have done everything we know how. How about. giving us a little help, now, from Your end?"

So, repeating some of the testimony that was given by the Secretary of the Chamber of Commerce, in Cambria County we have 32 boroughs outside the city limits proper, along with the townships which comprise roughly over the two-thirds of the population of the county.

In approximately 18 of those 32 boroughs in the county, through their own efforts, they have established industrial redevelopment programs, commissions, committees, whatever you may call them. They have secured into the county approximately 14 small new industries, mostly in the soft goods and the wearing apparel field, and mostly employing female labor.

There are constantly, and this week there has been announced two additional small groups with that same objective in mind-securing employment for their communities.

All I can repeat is what has been given by many of the people thus far, that these little towns have done everything they know how. They are not looking for a handout. They are willing to do everything they can to help themselves. They just have reached the limit of their ability, and so, like our high school football team, they are saying "Lord, we have done everything we can ourselves. We are looking to a higher power to give us what help and direct our efforts in the best possible manner."

Thank you.

Senator NEELY. We thank you, sir.

Mr. SAYLOR. Now, Mr. Chairman, as the last witness that we have, I would like to have the Mayor and the members of the Council of the city of Johnstown, which is the largest municipality in this district, appear.

This is the Honorable Walter E. Rose, mayor of the city of Johnstown, and the Honorable Eddie McCloskey.

Senator NEELY. Let us first hear from his Honor, the Mayor.
Mr. SAYLOR. Very well.

STATEMENT OF HON. WALTER E. ROSE, MAYOR OF THE CITY OF JOHNSTOWN, PA.

Mayor ROSE. Not having any advance notice that I would be invited to participate in this hearing, I come unprepared to discuss the merits of the Douglass Bill.

I haven't any prepared statement, nor have I marshaled any statistics, but I welcome the opportunity to make one expression. I don't think it is fair to let the impression be formed from this testimony that Johnstown, the city of Johnstown, is a distressed area. I would like to point out, in behalf of the administration, that we will agree that that is a designation of an area, but the city of Johnstown, we are very proud to say, is out of debt.

We haven't increased any real estate taxes. The employment in the city, itself, is good. I merely want to have anybody that reads the testimony or hears it realize that the city, itself, is not in distress. We are very proud of our financial condition.

Mr. McCloskey has a letter there, and he has expressed a desire to talk on a few questions.

Senator NEELY. Mayor, please let me sincerely congratulate you on the fact that your city is out of debt and that you have no serious problems in Johnstown. You will doubtless become the envy of almost every other municipality in the United States.

Mayor ROSE. The city council met and they came to the conclusion that we are standing still.

Senator NEELY. It is better to stand still than to run in the wrong direction, and eventually fall into a bottomless pit.

Mayor ROSE. Thank you.

Mr. SAYLOR. The next witness is Councilman Eddie McCloskey, who is the director of public safety.

STATEMENT OF COUNCILMAN EDDIE MCCLOSKEY, DIRECTOR OF PUBLIC SAFETY, JOHNSTOWN, PA.

Mr. MCCLOSKEY. Senator Neely, I like your word when you said that you couldn't put industry in all districts. That is true, and stealing industry from one district to another doesn't help. We have experienced Altoona coming over here and stealing the radiator works from here.

Now, if we were to go back over and offer them a little more and bring it back here, it wouldn't be very good for them. When I was mayor of this city, they took me to Greensburg to try to induce some industry to move here and I refused to do that because they belonged in Greensburg.

Now, I agree with Mayor Rose, we are not a distressed area, and we are in no way depressed, but we have got a lot of empty storerooms and vacant homes in Johnstown. Bethlehem Steel Co. now employs 16,000 men and Lorain Steel; that is, Carnegie Illinois, which is a part of the United States Steel, have 2,100 employed as they told me yesterday, but those men come from a distance, Senator, of 35 and 40 miles. All we get from them is the opportunity to allow them to park their cars on the street all day. Their wage tax even goes back to their district.

A wage tax was passed in this State thinking we here would get it like Philadelphia does. They get it for all employees in that city. But we don't. Each district wherever they live gets the wage tax. All we get is the opportunity to allow them to park all day on our streets while they are at work day or night.

Now, we have got to get more parking space. We have got to widen our streets. We have got to put a boulevard in down here to speed traffic, and as the Mayor told you, we are out of debt now. Thank God, through him, and members of Council, we are out of debt.

With the people's help we are free of debt. But we are going to be population free, the same as debt free, unless we do something to get more industry to locate here and we realize, as you said, the Government cannot order industry to locate in any district unless they choose to do so.

But if you could, what I would like to see, and I think the Chamber of Commerce would quite agree, companies engaged in work for the Government encouraged to operate in this area or other distressed areas, as you call them, distressed, we object, of course, to the word "distressed". Our trouble is that we have a surplus of labor which will grow larger and larger when the steel mills catch up with their

orders.

In Somerset which is just a short distance we have a main line of the B & O. That is Rockwood. Here we have the main line of the Pennsylvania Railroad. In between we have the Pennsylvania Turnpike. We have coal, power, and most important of all, water. We have manpower. We have land; we have everything for industrial expansion. We ask your help in getting us more industry if you can. Give us or help us get a 4-lane highway through here, particularly connecting north and south main roads. Senator, if you would pass a bill without all of this red tape in it that we borrow money which we don't want to do . . . we will not borrow money. We are debt free, we want to stay that way. We want to pay as we go so as to keep our tax rate on property and business as low as we possibly can as that is the best inducement to get new industry.

Mr. Senator, when I was mayor during 1932, 1933, 1934, and 1935, I inherited a city debt and we paid as high as $487,000 for amortizing bonds a year out of a tax income of less than $1 million.

So you see, if we borrow money, we are putting ourselves further in jeopardy, and if we must borrow we can get it from our local banks without any redtape. What I would, if the Federal Government would join us, or with any community that has a surplus of labor that puts up 20 percent, the State puts up a grant of 20 percent, the Federal Government gives us a grant of 60 percent for public works projects. They would get it back from us in income tax.

They give to foreign aid; class us as foreigners, if they wish. They give now a total of 100 percent to those foreign countries. All we want is a part of it. If they would do that, we could put all these public-work projects in working.

We started a sewer system, which put us in debt in 1916. It has over 5 million to 6 million in it, and it is not completed. It will cost us 5 million or 6 million more to complete it. It will cost us then a few million to put in a disposal plant. It will cost us a few million to put a boulevard in to speed traffic through.

73437-56-pt. 1- -27

It will cost us a few million to widen our streets. Then Bethlehem Steel Co. wants to sell the waterworks. Well, if they sell it to someone else, then we are further in jeopardy. We will have a chance of buying it.

Senator NEELY. Johnstown has already had more than its share of trouble with water.

Mr. MCCLOSKEY. That is right. That was a dam owned by a Pittsburgh hunting and fishing club that caused that flood. I suppose you knew that they were not from West Virginia.

They had a dam in St. Michael, 8 miles away that burst over here. Senator NEELY. Was that on the Conemaugh?

Mr. MCCLOSKEY. Yes; it came down the Conemaugh, at times called the Little Conemaugh. But what I would like to see, Senator, is all this redtape come out of these bills. I read Congressman Saylor's bill and it was I who suggested to him 2 years ago to put a bill in to help alleviate the labor surplus. He put one in. It didn't get very far. Then about 50 other Congressmen, Van Zandt and all the others, put a bill in, a similar bill. Now, January 9, 1956, Congressman Saylor presents bill H. R. 8220.

You know the hoppers are full of similar bills down there. They are all alike, and they all have the same old redtape. They are meaningless, and just incite and fool the voters near election time. Then the State had one passed that the Commerce Commission down there must agree so they can tell us what to do. So we go through all that redtape meaning nothing. We just put ourselves in debt for traveling expenses to and from Washington and Harrisburg and we still, after 2 years, have a surplus of labor and our steel mills working at capacity.

Now, if you would pass a simple bill that any community that has a surplus of labor that puts up 20 percent and the State puts up 20, that the Federal Government should give the other 60, not a loan, an outright grant.

If the State is politically minded and doesn't want to give it to the community, then let the community put up 30 percent and the Government 70, and eliminate the State, and all that politics, for if you, Senator, or any other Senator, are going to advocate to build buildings in these communities, I hope you see further than just these few districts here that we are talking about.

I just came back from Florida. After 3 weeks down there surveying around, the building they are doing is tremendous. If the Federal Government starts building buildings for corporations with the low and miserable wages they get in the South, all our industry will be down there if the Federal Government is going to build buildings for them it will help move the industry down there, and I don't think it should be, Mr. Senator.

I don't think that the Government should build buildings. If they do, I repeat, we will lose all the industry from the North. You will be licking your own purpose. West Virginia will be further licked the same as Pennsylvania. They will all move south. They are building terrific down there, and you know those Democratic Senators are not too slow in picking up what they can.

Senator NEELY. In this particular matter I have not discovered any difference between Democrats and Republicans.