Mr. BUFFETT. That is all, Mr. Chairman. Mr. BOGGS. Mr. Chairman. The CHAIRMAN. Mr. Boggs. Mr. BOGGS. I referred briefly, the day before yesterday, to the results of a survey conducted by the joint committee among the mayors and governors. I should like to read a brief résumé of that survey. The question was asked if there is a low-rent housing project in your city developed under the United States Housing Act of 1937, has it served low-income families? In answer to that question there was 51 affirmative answers and 4 negative. The next question was, Has it been built and operated efficiently? There were 50 affirmative responses and no negative responses. The next question was, Has it increased neighboring real estate values? Thirty-five affirmative answers and seven negative. The next question was, Has it reduced the cost of city services? Thirty-four mayors answered "Yes" and five answered "No." The next question was, Have delinquency and health conditions in the neighborhood improved? There were 42 affirmative responses and no negative responses. The next question, has it competed with standard private housing? There was one affirmative response, and there were 46 negative re sponses. The governors replied, in answer to the question of whether or not private enterprise could supply housing to the extremely low-income group without Government assistance, 20 said assistance was needed and 4 said "No." Among the mayors, 56 said "Yes" and 5 said "No." Those answers came from mayors of the larger cities of the United States, many of which are located in our own congressional districts. There has been a considerable amount of talk here, Mr. Egan, about cost factors. In calculating cost to the municipalities, in order to arrive at a fair answer to the problem, is it not necessary that you calculate what the city saves as well as what it spends, in your opinion? Mr. EGAN. That is correct. Mr. BOGGS. Do you have any figures from the larger American cities, showing the amount or showing the decrease in expenditures for police protection, fire protection, juvenile delinquency, and matters of that character, where some of these projects have been built? Mr. EGAN. I have none of those figures, Congressman. I know that there have been claims made that there have been reductions in cost. They are rather intangible items to which to put a dollar value. I think that there might be somewhere an example by which to put a dollar value on those benefits. Mr. BOGGS. Well, certainly in the area of slum clearance, is it not a fact that many of these slum areas are located in high-priced real estate sections of certain American cities? Mr. EGAN. Yes, sir; that is correct. They are generally 'in the central part of the cities. Mr. BOGGS. So that the mere fact that they are slums means that it is almost impossible to realize any great amount or reasonable amount of ad valorem taxes in those areas, is that not right? Mr. EGAN. I think so, Congressman: As an example, I might cite the city of Philadelphia. In 1938 in the slum areas of the city, each year you will notice that the assessed valuation of the area was going down. That is a matter of record. I checked on that myself some years ago. Mr. BOGGS. So that if it were possible to devise some program for slum clearance similar to the one advocated in this legislation, one of two things could be accomplished: Either those areas could be cleared of slums and made available for the building of new homes or they could be cleared of slums, and if situated in the proper neighborhoods, could be made available for the construction of business establishments. Mr. EGAN. That is correct, sir. Mr. BOGGS. In either case, the amount of revenue to the city might very well offset the cost, over a period of years. Is that a fair assumption? Mr. EGAN. Yes, sir; I would say that that is a fair assumption. Mr. BOGGS. And when you add to the increased revenues, which are bound to accrue the decrease now would go to fire, police, and crime prevention-then that would be an additional incentive, do you not think so? Mr. EGAN. Yes, sir. Mr. BOGGS. A question was propounded here this morning as to how many public-housing units might eventually be constructed. Under our form of Government, that is something that must be determined by the Congress of the United States, is that not correct? Mr. EGAN. That is correct. Mr. BOGGS. So that it would not make any difference whether you advocated one or a million units. The decision would be made by the people through their representatives, is that not so? Mr. EGAN. That is correct. Mr. BOGGS. That is all. Mr. BROWN. I would like to ask one question. The CHAIRMAN. Mr. Brown. Mr. BROWN. Have any of these large cities made any effort to clean out their slums? Mr. EGAN. Yes, sir. Mr. BROWN. Without the aid of the Federal Government? Mr. EGAN. Yes, sir. The CHAIRMAN. In answer to that question, would you give us the Baltimore project as an example? Mr. EGAN. Yes; Baltimore has been using its police powers to force the owners to tidy up the slums, but they still remain slums. On the other hand, a few cities are actually clearing some slum areas. In New York City, using city funds, there is a limited program to clear out slum areas and build new projects. In the city of Chicago, I believe they have made some progress in that direction. Mr. BROWN. I might say to the witness that I think everybody on this committee would like to get rid of slums. Is slum clearance the responsibility of the local community, the State and local communities, or the Federal Government, or is it a combined responsibility? It seems to me the inquiry relative to slum clearance should be confined along this line. Certainly, I believe slums ought to be cleared. Mr. BUFFETT. In that connection, Mr. Egan, do you believe it to be the responsibility of the Government to provide a citizen with housing facilities? Mr. EGAN. The responsibility of the Federal Government to supply its citizens with housing facilities? Mr. BUFFETT. Yes. Mr. EGAN. Well, I certainly think it has an interest in its citizenry. I think it is pursuant to that interest that the Federal Government is making an effort in that direction by insuring mortgage loans. Mr. BUFFETT. Well, in insuring loans it is facilitating the borrowing of money; but I am specifically interested in that question, whether the Federal Government would have the responsibility to a citizen to see that he has a house in which to live. Is that the theory on which this public housing is predicated? Mr. EGAN. I presume it is, Congressman, assumed that the Federal Government has an interest in seeing that every family has a home of minimum decent standards. Mr. BUFFETT. That leads me to the next question. I have not been able to find an answer to it. Does the Federal Government have a responsibility to provide housing at location-to provide me housing in this country at a location on which I decide-say, California? If I go out there, does the Government have the responsibility to see to it that there is housing there for me? Mr. EGAN. Are you talking about any housing at all? Mr. EGAN. Where you are domiciled does not make too much difference, does it? If the Government has any responsibility at all, it should not rest on where you are domiciled. Mr. BUFFETT. If the Government has the responsibility to house me in New York City, let us say, and I decide to go to Chicago, does the Government have a further responsibility to see that there is housing for me in Chicago? Mr. EGAN. It depends upon what type of housing you are looking for. Mr. BUFFETT. I am trying to run this thing down to its ultimate conclusion. It is my own impression-I do not offer it as a conclusion that if the Government is responsible for housing me as an individual, eventually it is going to be able to say where I should be housed. I do not see how it could be otherwise. If the Federal Government is assuming the responsibility for furnishing me satisfactory housing, then certainly the Federal Government cannot assume the responsibility of furnishing housing to everyone in America at the place where he might like to live. For instance, I might decide to go to Texas next month. When I get down there, and I am looking for housing, and I say to the Government, "I cannot find a place to live. This is not fair; I have got to 'have a house." If the idea that the Government is responsible is the original premise of this public-housing feature, how do you shut that off? Mr. EGAN. I do not see how the Government could ever take the attitude that they could tell you where to live. I do not think we are quite to that police state in this country. Mr. BUFFETT. If I am going to be responsible for a person's welfare, is it not inherent that I have a measure of control over that person? Mr. EGAN. The Government, it seems to me, has responsibility to its citizens in general, and I think is interested in the welfare of its citi zens. Now, to what degree, is something as to which the Congress should make the determination. Mr. BUFFETT. You surely do not feel that there is any detached entity, here, which is interested in the people's welfare? The Government, as you speak of it, is simply the ruling politicians who are interested in their own job and their own continuance in office. I mean they certainly are not thinking of the welfare of the people ahead of their own future, are they? Mr. EGAN. I think they are, yes, sir. Mr. BUFFETT. I wish I could believe that. Mr. BOGGS. Mr. Chairman. Mr. TALLE. Mr. Chairman. The CHAIRMAN. Mr. Talle. Mr. TALLE. It was argued a moment ago, by the gentleman from Louisiana, Mr. Boggs, that cities can save money by spending for slum clearance. I think his argument is valid. That means benefit to the city, does it not? Mr. EGAN. It certainly does. Mr. TALLE. Would it not then be proper to say that inasmuch as the city gets the benefit, the city should bear the cost of bringing about those benefits? Mr. EGAN. Well, indirectly it seems to me that the city is bearing some of the cost through other taxation. Mr. TALLE. Is it not proper that the city should do its own slum clearing? Mr. EGAN. Congressman, if they could do it, I think they would have done it long ago. Mr. TALLE. That raises a problem in finance that has amazed me for so long. The States say they cannot do certain things, and the cities say they cannot do certain things. It seems to me that these individual municipalities, subdivisions, or States, are all so poor that they cannot do these things for themselves. But somehow, by the magic of combining together, everybody can get everything. It is just like 10 people not having enough for a meal, as far as each individual is concerned, but by emptying their pockets and looking at the thing as a whole, they all have a good dinner. The CHAIRMAN. Is not the reason, Mr. Egan, why cities sometimes think that they cannot finance their own slum clearance and low rental project programs because of State debt limitations? Mr. EGAN. That is correct, Mr. Chairman. The CHAIRMAN. That is a local matter, is it not? If a State or a municipality has some restrictions, has so restricted itself that it cannot exercise its sovereign power, then perhaps the fault lies in their own action and not in correcting that situation by coming to the Federal Government. Mr. TALLE. Mr. Chairman, may I prove your statement by a letter I received today? There is a little town, which says it is not permitted by law to bond itself beyond a certain point, and the improvements to be carried out would cost more than the law allows. I was invited to find out about Federal money, what Federal funds there might be lying around loose to ship in to take care of this situation. The CHAIRMAN. Many of the States have restricted themselves so much under their own legislation that they cannot operate their schools. So they find it advisable to come to the Federal Government to get the money with which to operate their schools, the reason given being that they have passed laws themselves which restrict them in such a manner that they cannot exercise their sovereign powers under their own constitutions. Mr. EGAN. That is correct. The CHAIRMAN. I do not know how reaching that is going to be. I thought that we had better have that question before us in this discussion. If it becomes only a question of debt limitation in those cities, then, of course, it should be the obligation of the State to put the cities in such a position that they could do the job which must be done in those cities. All a city or State has to do to get Federal help under those conditions is to furnish further restrictions, further restrict itself in its functions, further destroy the machinery under the sovereignty of the State as maintained, and then, of course, we will have concentration of control, concentration of Government, and collective Government, and socialism. It seems to me the States have done a very dangerous thing in many particulars in so restricting their activities that they have to come to the Federal Government to get assistance. There is a very basic fundamental problem here which might involve the sovereignty of our several States. Mr. EGAN. Not only in housing, Mr. Chairman, but in other fields as well. The CHAIRMAN. Yes, sir; in any other fields. Mr. BOGGS. Mr. Chairman. The CHAIRMAN. Mr. Boggs. Mr. BOGGS. If the theory that the Government has no interest in housing problems is followed to its ultimate conclusion, then we would abolish the Federal Housing Administration, the Federal Home Owners Loan Corporation, and all of the others which are very beneficial, in my opinion, although many members might disagree with me, highly beneficial institutions which we have created to promote the construction of homes through private enterprise, is that not so? Mr. EGAN. That is correct. Mr. BOGGS. Is it not also true that if the economic position eases, as was referred to this morning, if that should occur, would there not be as much loss on Federal Housing Administration insurance as through any other Government program? The CHAIRMAN. Perhaps you should not put it so broadly. Mr. BOGGS. I mean to say, "any other Government program." So if we are to face the housing problem squarely, both in the field of private enterprise, and in the limited field where Government can operate, we have got to realize that there is a certain risk involved, is that not so? Mr. EGAN. That is right. Mr. BROWN. You might give as an illustration, the Home Owners Loan Corporation. Mr. BOGGS. Exactly. I am glad you mentioned the Home Owners Loan Corporation because I meant to mention that as one of the Government corporations which had demonstrated the interest of the Government in the housing industry, and which, as I understand it, was liquidated with a profit, is that correct? Mr. BROWN. That is right. 75674-48- -27 |