The needs of Appalachia are not without parallel in my own State, the State of Minnesota, and in the States of Michigan and Wisconsin. For that reason, Senators Hart, Nelson, McCarthy, and I have sponsored an amendment to S. 3, to promote development of the economic potential of the upper Great Lakes region. I strongly urge that the Committee on Public Works give favorable consideration to our amendment. Northeastern Minnesota, once one of the richest and most productive areas in the world, has in recent years suffered a severe economic decline. Many businesses are failing and others are existing on a marginal basis. Unemployment is high and the resulting losses in human and economie values has given rise to a situation that the State of Minnesota cannot longer tolerate without substantial adverse effects on its own economy and the entire economic structure of the Midwestern and Great Lakes States. Northeastern Minnesota, and this is true of the other Great Lakes States included in the amendment, are caught in a vicious squeeze between a rapidly declining tax base and spiraling governmental costs. For example, State and local taxes expended for welfare purposes in northeastern Minnesota only 2 years ago totaled over $23 million, and this figure is substantially higher today. The iron ores of the Mesabi Range in Minnesota through two wars supplied a substantial proportion of the armorplate and steel needed for tanks, guns, trucks, airplanes, and essential military materials. Minnesota ore has also contributed to the industrial expansion of this Nation in peacetime. Now that the high grade ore in Minnesota is for the most part gone, the Nation must not turn its back on these people who are beset by severe economic hardship. Employment in iron mining has dropped over 25 percent in the last 4 years-the general rate of unemployment is nearly three times the national average. In some especially hard-pressed sections, more than a fourth of the workers are without work. And these figures do not begin to reflect the numbers of men who are working short weeks. All of the Minnesota counties in the present version of amendment 1 (along with many adjoining counties) are classified by the Department of Labor as being areas of "substantial and persistent unemployment." Consider St. Louis County, for example. According to the Department of Labor. the average annual rate of unemployment in this county, which includes the city of Duluth, has been at least 50 percent above the national average for 3 of the last 4 years. And on the iron range section of the county, the average annual rate of unemployment has been 75 percent above the national average for 2 of the past 3 years. Part of the cost to this region, and to the State of Minnesota, is calculable in dollars and cents. I would estimate that northeastern Minnesota has cost employers more than $50 million in unemployment compensation benefits for the past 5 years, and this may be a very conservative estimate. But the total cost in terms of human values cannot be determined by any scale or slide rule known to man. We cannot know what it means to a man to rely on governmental assistance to feed his children and clothe his family. The Great Society certainly cannot exist in such homes and in such communities. It is clear that the people of the region are doing all they can to restore their area to economic health. It is up to all of us now to put forth equal efforts. Senator Hart, McCarthy, Nelson, and I have pledged our personal support for the economic betterment of those depressed areas. I know Ispeak for them when I ask this committee to give serious and full consideration to amendment 1 to the present Appalachia bill. The upper Great Lakes area has a substantial, common identity of interest with Appalachia, and it would be highly appropriate for this committee to take favorable action. Before I joined this body as a Senator, I was attorney general of the State of Minnesota. Our great Governor, Karl F. Rolvaag, appointed me to lead a "task force for economic recovery" in northeastern Minnesota. No one knows better than I the problems of that a:-a and I respectfully urge that the time to act is now, before a further serious decline in the potentialities of recovery there necessitates radical and expensive countermeasures. Swift action now can help the citizens of the upper Great Lakes region to work with State and local governments, backed by the assistance of the Federal Government, to bring back the economic prosperity they once enjoyed. STATEMENT OF HON. JOSEPH D. TYDINGS, A U.S. SENATOR FROM THE STATE OF MARYLAND Between my election on November 3 and taking the oath of office on January 4, I met with county and State leaders from areas in Maryland directly affected by the Appalachian program. I was again impressed by the need for legislation to help stimulate economic activity in the depressed areas of Allegany, Garrett, and Washington Counties. The roads program, stressed by many as one of the most important provisions in the program, will open up western Maryland and its beautiful recreation areas, its hunting and fishing preserves, and its lovely scenery to many thousands of Marylanders and other visitors reluctant to travel over the antiquated highways leading west. Improved highways that will allow trucks to travel in safety along these routes will encourage greater industrial activity in areas that have been inaccessible up to this time. The conservation aspects in the Appalachian program will prove particularly beneficial in developing watershed projects, preserving the precious topsoil of Maryland, reforestation, antipollution measures, establishing wilderness areas and sanctuaries, creating wildlife habitats, increasing game and fish supply, and maintaining safe hunting zones. Resort areas can be developed to provide facilities for physical activity so sorely needed by the residents of overpopulated urban areas. Western Maryland can offer the tourist or sernity-seeking Marylander an excursion into the earliest history of our Nation and provide a gateway to hunting, skiing, hiking, fishing, and boating. With economic aid from the Federal Government, as a foundation, an industrial rejuvenation is foreseeable in jobs and job opportunities to residents of western Maryland and other areas affected by the Appalachian Regional Development Act of 1965. It is important for planning to get underway immediately at the State and National levels to channel new sources of employment into depressed areas such as western Maryland where there is a stable and vital labor force. It is necessary for the economy that a strong emphasis be made on education of the residents most directly concerned with this program. Training and retraining programs must be established to provide the unemployed with productive skills to take advantage of new opportunities. As our automated technology swiftly swallows up unskilled jobs it becomes important that our work force be equipped with the specialties and technical training demanded in private industry and public works projects. Western Maryland, along with the rest of Appalachia, stands on the threshold of opportunity. It is the responsibility of the National Government, along with local authorities, to make sure that the opportunities are developed and that the people are prepared to take advantage of the opportunities. STATEMENT OF ANDREW J. BIEMILLER, DIRECTOR, DEPARTMENT OF LEGISLATION, AMERICAN FEDERATION OF LABOR AND CONGRESS OF INDUSTRIAL ORGANIZATIONS Mr. Chairman, my name is Andrew J. Biemiller, I am director of the department of legislation of the American Federation of Labor and Congress of Industrial Organizations. The AFL-CIO wishes to record its support of S. 3, the Appalachian Regional Development Act of 1965. Organized labor likewise endorsed the proposals of the Appalachian Regional Development Act of 1964, which passed the Senate but failed to receive House action in the final days of the 88th Congress. I am attaching to this statement for the record, the policy resolution on regional and resources development which was adopted by the AFL-CIO executive councial on November 24, 1964. This statement reiterates labor's support for the proposed Appalachia program and similar regional planning programs expanded to other areas of the country. I also wish to call to your attention that the AFL-CIO has formed a conference of our 11-State central labor bodies in the area to assist in revitalizing the economically depressed Appalachia area. I am also attaching to this statement, the AFL-CIO news release describing the makeup and proposals of this committee. The proposed act is a challenging and imaginative approach to a long-run solution of the special and pressing problems of a great and too long neglected region of the Nation. The AFL-CIO strongly endorses the act's coordinated approach to the problems of Appalachia and its far-reaching economic, social, human, and natural resource development objectives. It has long been our view-and it is now a widely accepted view-that the Employment Act of 1946 requires the Congress to seek solutions to the problems of chronic local and regional unemployment as well as unemployment which is nationwide in scope. The 87th Congress endorsed this view by passing the Area Redevelopment Act in 1961 to help find solutions for chronic unemployment that is basically local in character. We believe that the legislation now before you must establish at the outset an effective policy of broad overall regional planning of sound and interrelated programs. This means that aid for Appalachia must meet specific needs and must be adequately financed by Federal and State funds. It also means there must be effective Federal, regional, and State cooperation if the program is to yield results and justify the public outlays that are contemplated. Equally important, regional planning and regional action must enlist the local communities and the people of Appalachia in cooperative efforts. The 10-State region it will serve contains great differences-but the region also also shares many common characteristics. To deal successfully with the region's differing needs, resources, and social and political structures, administration of the program must be flexible and its administrator must be allowed to respond to changes and to make innovations which experience may demonstrate to be necessary. Authority must be coupled with responsibility in carrying out the Appalachian development programs. The sharp decline of Appalachia's basic industries-coal and timber-makes all the problems of the region more difficult to deal with. The decline of these industries adds to the region's burden of hard-core unemployment, poverty, and to the steady erosion of the morale and vitality of many of the people of the region. Isolation of many areas ravaged natural resources. Absentee ownership and educational deprivation are other symptoms of the region's chronic illness. In his state of the Union message, President Johnson reiterated his support for "a regional recovery program to assist development of stricken areas left behind by our national progress." He has placed Appalachian development legislation high on his list of bills for immediate action by the Congress, and as an important weapon in the administration's war on poverty. As the President's Regional Commission pointed out, the entire region shares this "unhappy distinction *** rural Appalachia lags behind rural America; urban Appalachia lags behind urban America; and Metropolitan Appalachia lags behind Metropolitan America." We believe that the proposed Appalachian Regional Development Act can help end this lag-that it can help win a major victory in the war on poverty. S. 3 calls for an authorization of $1,077,200,000 for the following major purposes: For construction of highways and local access roads. For construction and operation of demonstration health facilities_ For assistance to small timber growers.. For restoration of land damaged by mining---- For formulating comprehensive water development plans-- For vocational education facilities.. For local sewage treatment works. For supplementary various Federal grants-in-aid programs. Total----- $840,000, 000 69, 000, 000 17, 000, 000 5, 000, 000 21, 500, 000 5, 000, 000 16, 000, 000 6, 000, 000 90, 000, 000 5,500,000 2,200,000 1,077, 200, 000 We are particularly happy to note that these broad programs demonstrate a concern both for the development of physical resources and for human needs and for the development of human resources in Appalachia. We particularly endorse the proposed expansion of employment services, the provision of funds for community work and training programs, extension of the school lunch program, and support for health and housing. The people of Appalachia themselves must share in planning for progress. Without their participation, without their initiative, without their enterprise, this program will bog down in a morass of hopeless apathy. Appalachia needs money and technical assistance from the Federal and State Governments, but this assistance will be wasted effort if it fails to arouse, to stimulate local community action and personal enterprise by the citizens of Appalachia. To achieve the greatest possible citizen participation in the effort of each local community to develop its physical and human resources, we urge an additional and vitally needed program, a program of leadership development. We believe the legislation before you should include a new program to help people with leadership potential learn how they can improve their communities. Like the highly successful programs of the cooperative agricultural extension service so long conducted by the land-grant colleges, this new leadership training program could stimulate widespread citizen participation in Appalachia's towns and cities and local communities. Leadership classes and workshops in communities and short courses on college campuses can develop broad understanding of the Appalachian regional development program. We believe the people who attend these adult education programs will acquire the knowledge and motivation necessary to get effective community action underway-using tools and assistance available under this legislation and available from other Federal, regional, State, and local sources. We view this kind of educational effort as an opportunity to develop citizen leadersleaders who will give vitally needed drive and dynamism to the redevelopment and renewal of Appalachia. Therefore, we urge this committee to add an authorization of $7.5 million to this legislation. The land-grant colleges of the Appalachian States should have the authority to administer this money. Although the Agricultural Extension Service program receives Federal, State, and county funds, poverty in many Appalachian counties is so severe that we urge that financing be equally shared by the Federal and State Governments. Federal funds for this purpose might well be allocated on the basis of the population which each State has in the Appalachian area. Each land-grant college should establish an advisory committee broadly representing the public, including organized labor, to help develop the leadership training program. We believe the legislation should require consultation and cooperation among the colleges participating in the program. Our suggestion for leadership development would involve a relatively small expenditure, but it would have a high payoff rate in terms of economic and social progress in Appalachia. Therefore, we urge you to include such a program in the legislation now before you. Organized labor strongly endorses the inclusion in S. 3 of section 402 which provides for coverage of workers employed under projects assisted by Federal funds authorized under this bill by the prevailing wages provision of the DavisBacon Act as amended, and the reorganization labor standards set forth in the Reorganization Plan 14 of 1950, and section 2 of the act of June 13, 1934, as amended. This provision will prevent the programs to be carried forward under S. 3 from undermining labor standards in the construction industry in various localities throughout the Appalachian region. Finally I must call your attention to one weakness in the bill. When the Congress passed the Area Redevelopment Act, it properly specified in its introductory "declaration of purpose" that "under the provisions of this act, new employment opportunities should be created by development and expanding new and existing facilities and resources rather than by merely transferring jobs from one area of the United States to another." While this broad mandate has helped guide the Area Redevelopment Act, experience has proved that more specific safeguarding language is necessary if the intent of the Congress is to be effectively implemented. Therefore, we believe this legislation to help Appalachia should contain more adequate protections against plant piracy and "runaway" employers. The existing provision of this bill, section 404 (b) (7), which deals with this issue, should be clarified to make sure that Federal aid will not contribute to any transfer of jobs from one area to another. Moreover, to carry out this congressional intent effectively, the bill should spell out explicitly that aid should also be denied: (1) to an employer who engages in the subterfuge of changing his corporate name but who has in fact re 42-031-65-13 located; (2) to an employer who would engage in fulfilling subcontracts formerly performed elsewhere; and (3) to an enterprise that seeks to expand facilities in an industry in which very substantial underutilized capacity already exists. The AFL-CIO cannot too strongly emphasize the necessity of now writing such provisions into the act. In conclusion, I wish to repeat that the AFL-CIO strongly supports the Appalachian Regional Development Act, with the amendments I have described However, let us all recognize that the circumstances which have led to poverty, to blight, to social and economic lags in the depressed areas and depressed regions of this country were a long time in the making. Economic recovery inevitably will be slow. The Area Redevelopment Act programs and this proposed Appalachia program cannot be successful unless the American economy as a whole achieves and sustains a high rate of growth with expanding job opportunity for all American workers. Unfortunately, persistent unemployment and poverty can continue in depressed areas and in a depressed region like Appalachia even during times of national prosperity. But without national prosperity, without an expanding economy, without new job opportunities opening up, we cannot expect even the best of aid programs for depressed areas to be successful. Therefore, we urge this committee to act promptly on the Appalachian Regional Development Act of 1964, as part of the overall national attack on poverty and as part of the national effort "to promote maximum employment, production, and purchasing power," as required by the Employment Act of 1946. REGIONAL AND RESOURCE DEVELOPMENT Experience under the Area Redevelopment Act of 1961 has demonstrated the need for a broader assault on chronic depression-an assault that embraces a region rather than a single community. The proposed Appalachia program conforms to this need and it has our support. There should be similar programs in other areas, based upon the concept of regional planning. Financial and technical assistance by the Federal Government can obviously be more effective on this broader base. There remains the national challenge of conservation and development of natural resources. Such areas as water supply and river development, giant grids for the interstate transmission of electric power, desalinization of sea water, the preservation and maintenance of national forests and rangelands—and these are but a few-require firm Federal initiative. STATEMENT OF JACOB CLAYMAN, ADMINISTRATIVE DIRECTOR, INDUSTRIAL UNION DEPARTMENT, AFL-CIO Mr. Chairman, this statement is made on behalf of the industrial union department. Our affiliates include some 6 million union members. The industrial union department wishes to indicate our support for the speedy passage of S. 3, the Appalachian Regional Development Act of 1965. We appreciate the diligence with which this committee has toiled on this problem with all its economic and institutional complexities, because we feel this measure may mark the opening of a new frontier of social action and planning, a precedent for zeroing in on the particular problems of a region differing in nature or intensity, or both, from the rest of the country. The geography, resources, level of unemployment and breadth of poverty in much of Appalachia certainly calls for a new approach, an approach designed to apply some specific remedies already agreed upon, but also designed to provide the means for continuing studies of the entire area, studies which can lead to creative new action or institutions. We are highly conscious, as indeed you must be, that the most promising program of regional planning and development can achieve only limited progress in the face of the continuing high level of unemployment in the country as a whole. In offering our strong support for S. 3 we wish to reiterate our oftrepeated belief that despite the better than usual record on unemployment of the last 4 years, we must do far better. Some of us are old enough to remember that in the sometimes almost desperate days of the New Deal, we were constantly confronted with the obvious fact that a great many of the individual, local, or regional problems we were grap |