there is general recognition that money has to be raised over a period of years and that does involve the issuance of bonds. Would you care to comment on that aspect of that?

Mr. FLEMMING. First of all, as I pointed out in my statement, and I am sure you noted, we do think of these as conditional grants, really.

Now, as far as this being a banker's bill is concerned, of course, some banks will buy some of these bonds, but they are also going to be purchased by private investors, by insurance companies, by pension funds, and so on.

If the Government should move in the directiton of any of these other bills, I don't think that there is any doubt at all in anybody's mind but that the Federal Government would have to go out and borrow in order to finance these other bills.

Once again, bankers and insurance companies and pension funds and private investors would have the opportunity of purchasing the bonds and earning some interest.

As I indicated earlier, our feeling is that probably there would be a lower interest rate on the bonds issued by the local school districts under these circumstances than there would be on the bonds issued by the Federal Government.

They enjoy certain advantages; they are tax exempt, and, of course, they would have the complete backing of the Federal and State Governments.

Mr. THOMPSON. Does that not cost the Government some money when they are tax-exempt local bonds?

Mr. FLEMMING. That is correct.

That should be considered as you balance it. I do not know where you come out on balance, but my only point is if you move down the road we have suggested, sure, some people are going to earn interest on some money.

If you move down the road some of these other bills suggest, the Federal Government is going to have to borrow and some people are going to have some interest payments as a result of it.

Mr. THOMPSON. When I first saw the legislation, I was tempted to characterize it as a banker's bill, but I resisted that temptation until after I had read the bills. I am glad I did, because I do not share your optimism.

I do not think this will help the banker; I do not think it will help the schoolchildren; I do not think it will help anybody.

Therefore, certainly I do not think it can be called a banker's bill. That is just a sort of editorial comment.

We have Mr. Pucinski of Illinois with us who might have some questions.

Mr. PUCINSKI. Thank you, Mr. Chairman.

Just one thing dawns on me here. The President spoke in his state of the Union message about national goals. You seem to subscribe to that theory. That would indicate to me that perhaps the administration is not quite certain what position it wants to take in the educational field to aid education.

If the national goals commission, as a hypothetical situation, should embody the philosophy included in the School Support Act of 1959, would you, Mr. Secretary, change your position and support that concept?

Mr. FLEMMING. That is a hypothetical question. I don't know whether they would, or not.

In the first place, as I understand the kind of assignment that would be given to them, they would not be given the assignment of developing specific programs in order to achieve the goals.

The President indicated, particularly in his budget message, that they would be given the assignment of developing goals and then of suggesting what would be a fair share on the part of the Federal, State, and local governments, but I don't think they would go beyond

that at all.

Mr. PUCINSKI. In view of the President's own statement on national goals and your apparent support of that concept, I get the impression that the administration's bill you are discussing now is pretty much of a stopgap suggestion.

I was wondering how long do you think that we in America can deal with this whole problem of education on a stopgap basis.

Mr. FLEMMING. Mr. Congressman, as I think of what has happened during the past 4 years, I would be willing to take your label-although I don't agree with it—and say that it is at least better for us to move in and do something on a stopgap basis than to continue sitting around and talking about the thing and not doing anything at all.

Now, as I indicated earlier, possibly when you were not in the room, it is my judgment that here is some common ground on which we can meet in order to get started on helping these particular types of school districts build schools that would provide additional classrooms.

I would like to get started. If, as a result of the establishment of agreement on national goals and if as a result of agreement on what constitutes a fair share between the Federal, State, and local governments, it looks as though we have to think in terms of a different type of program I am willing to face it frankly and realistically, but as of this morning the thing I am trying to plead for is action in this area and I think we will get a broader base of support if we stay here than if we go down the road, which a great many people very sincerely would object to, of a grant for general operating purpose.

Mr. PUCINSKI. Mr. Secretary, you have already conceded to Mr. Metcalf that this particular bill would not solve the problems of the moment. I will have to yield to Mr. Metcalf's better judgment that when you are through with your survey there will be probably many other States. So with this concept of stopgap action at this time, will we have to come back again, or would you feel that perhaps we ought to faceup to this problem and go along with the School Support Act of 1959?

Mr. FLEMMING. In the first place, I have not conceded to anybody that there are a lot of States that could not qualify under this program. In my judgment and on the basis of the material that has been presented to me, and subject to a check on this one possibility on Montana, there is not a single State that could not qualify under the capital grants and loan provisions.

I think that this program could get underway in an expeditious way. Certainly we are going to make more progress if we get this bill through than if we don't get anything through.

Mr. PUCINSKI. I have one final question, if I may.

It just seems to me, and perhaps you would like to comment on this, that the administration bill does not take into consideration the tremendous changes occurring in the country, the shift of population, the movement west, and everything else.

I was wondering now, how can these States, that have to practically change their constitutions and everything else, keep pace with the program that you have presented to get immediate help?

You say you want to get started right now. I think everybody here wants to get started right now. But if these States are going to have to engage in very prolonged delays and court tests and constitutional changes and legislative changes, do you think that we really can get started right now under your concept?

Mr. FLEMMING. I don't accept your assumption. I don't think there is a single State that by legislative action could not get ready to participate in this program.

Mr. FRELINGHUYSEN. If I might intervene on that, the Democrats have been in control of Congress for the last 4 years and they have come up with a proposal backed by both Republicans and Democrats which is far more modest than H.R. 22, and we have failed to get any passage. So we still have a practical problem of agreeing on something and getting it through.

In spite of the fact that the Democrats should know all the answers they give the impression that they do-we have had difficulty in this

area.

What we have come up with has not been based on the President's recommendation.

Mr. THOMPSON. One of the chief difficulties has been that those of you who introduced the President's own legislaiton sat in this very committee room and voted against it when we offered it to you. I think that these common goals that the Secretary speaks about are lovely things and I hope we get to them. I think we had better. terminate this on the political note that has been injected and, Mr. Secretary, it is my understanding that you will be available on Tuesday?

Mr. FLEMMING. That is right; Tuesday morning.

Mr. THOMPSON. And Commissioner Derthick, would you be able to return?

Mr. DERTHICK. Yes, sir; I shall be glad to.

Mr. THOMPSON. We would like to thank you very, very much for coming. We are all as interested in our ideas as you are in yours, and this generates a little bit of heat now and then.

But we do have some common goals.

Mr. FLEMMING. I appreciate very much the opportunity and appreciate very much the way in which the hearing has proceeded. Mr. THOMPSON. Thank you.

The committee will adjourn until 10 a.m., tomorrow, when it will sit jointly with the Elliott subcommittee to discuss the operation of the National Defense Education Act.

Thank you.

(Whereupon, at 12:30 p.m., the subcommittee was recessed, to reconvene at 10 a.m., Thursday, February 19, 1959.)

SCHOOL SUPPORT ACT OF 1959

TUESDAY, FEBRUARY 24, 1959

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE ON GENERAL EDUCATION, OF THE

COMMITTEE ON EDUCATION AND LABOR,
Washington, D.C.

The subcommittee met at 10:10 a.m., pursuant to recess, in room 429, House Office Building, Hon. Cleveland M. Bailey (chairman of the subcommittee) presiding.

Present: Representatives Bailey, Thompson, Udall, Brademas, Frelinghuysen.

Present also: Representatives Wier, Elliott, Green.

Staff members present: Fred G. Hussey, clerk, full committee; Melvin W. Sneed, minority clerk; Russell C. Derrickson, investigator, full committee; and Robert E. McCord, clerk, subcommittee.

Mr. BAILEY. The subcommittee will be in order.

The committee met last week to hear the Secretary of Health, Education, and Welfare explain the administration's proposals for school legislation. We were unable to complete the presentation and we have asked Dr. Derthick, the Federal Commissioner of Education, to come in this morning and enlarge on the comments of the Secretary on the legislation and give the committee members an opportunity to find out just what is contained in the administration's approach.

Mr. Derthick, will you proceed with your statement? If you have any additional members here who have not been introduced to the committee, you might introduce them.

STATEMENT OF L. G. DERTHICK, COMMISSIONER OF EDUCATION, ACCOMPANIED BY ELLIOT RICHARDSON, ASSISTANT SECRETARY FOR LEGISLATION; RALPH C. M. FLYNT, ASSISTANT COMMISSIONER FOR LEGISLATIVE SERVICES; HERBERT S. CONRAD, DIRECTOR, EDUCATIONAL SERVICES BRANCH, DIVISION OF STATISTICS AND RESEARCH SERVICES; AND SIDNEY A. SAPERSTEIN, LEGISLATIVE ATTORNEY, OFFICE OF GENERAL COUNSEL, U.S. DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE

Mr. DERTHICK. Mr. Chairman, certainly it is nice to be back, and I am very happy to be back.

I would like to say, Mr. Chairman, that Secretary Flemming would like to come back a few minutes tomorrow. As you know, he wanted to come today, but he was called before the Appropriations Committee; and if he could come back and make himself available for any further