Finally, we point out again that there actually is no housing shortage or emergency requiring broad additional Government commitments at this time. We believe that the members of this committee can best serve the interest of their constituents and of the Nation by laying aside the pending legislation and substituting a resolution for an unbiased investigation of all federally assisted housing and the real present status of housing in the United States.

We are certain that such an investigation of the housing situation would demonstrate that the Federal Government should withdraw from all activities connected with housing financing and construction, leaving to private enterprise and to the States, cities and towns of the country such activities as they may see fit to undertake with respect to the housing industry.

Private initiative and industry and private investment of capital during nearly all the years of this Nation's existence resulted in the creation of the best housing in the world for the mass of American people. When the burden of taxes is reduced by withdrawal of the Federal Government from the housing field, private enterprise will be able to resume the full performance of its function to provide adequate housing at reasonable rates for all classes of people.

We thank you for this opportunity to be heard.

Getting back to the matter of what happened in the southwest district of this city and so-called urban renewal, I am somewhat familiar with it, having written a chapter of a book on it several years ago back in 1956.

Those people, largely colored people who owned little houses down here, they were substantial little brick houses, some of them were framehouses, but they afforded shelter for the people. They were on ground that had great potential value. The houses were taken by condemnation of the Federal Government, these little people, socalled underprivileged and they were underprivileged in this respect, didn't have the means to employ high-priced appraisers or highpriced real estate experts or even good lawyers and the Government fixed the price on these little houses and in some cases took the land, took the property at less than the amount of mortgages that was on the house. They then evicted these people, tore the houses down before the people even had a chance to go into court. When they did go into court, they didn't find what is known as a common law jury; they found a special jury, a sort of what you call in New York a blue ribbon jury, a handpicked jury of the Government that could not even see the houses that had been taken and the people were unable to properly defend themselves and their houses were taken at absurdly low valuations.

Then the houses were turned over to millionaire real estate speculators from New York and the land rather, was turned over to these real estate speculators from New York who have embarked on a building campaign and I think the minimum rent for a one-room apartment is $110 a month and they rent up to $200 a month or so and the result is the poor people, the so-called underprivileged have been evicted, scattered in slums throughout the city and the profit has gone to these real estate speculators from New York and if that isn't an atrocity committed on American citizens I don't know what is.

I thank you for this opportunity to make this little presentation and for the opportunity to put the complete statement into the record. Mr. ADDONIZIO. Thank you, Mr. Brinkman.

Mr. BRINKMAN. I do have one suggestion to make on behalf of the association.

If you allow money to be loaned to housing authorities and local authorities to renovate houses, to rehabilitate houses for urban renewal at 3 percent, you are creating another discrimination against private property which must pay at least 6 percent if it wants to do a renovation or rehabilitation job, for instance.

The result is that people move out of the private properties that aren't rehabilitated into the renovated Government-financed houses, creating great deterioration and inability of the owners of the private housing to rehabilitate or renovate their properties, and you are on the way to creating new slums.

If this committee will make sure in framing the bill, assuming it does pass a bill, and we frankly don't want a bill, but if the committee does recommend a bill, we would like the committee to give consideration to the question of whether adequate provision is made in the bill so that owners of existing property can borrow money at reasonable rates to rehabilitate and renovate their properties and thus make unnecessary the appropriation by the Government of hundreds of millions of dollars for public housing and urban renewal.

Thank you.

Mr. ADDONIZIO. Mr. Brinkman, I only have one question. Referring to those figures that you gave before of the ratio of vacancies, it is my understanding that the population in this country is growing at the rate of about 3 million people a year and, of course, on top of that the Census Bureau figures recently indicate that there still are many slum units in this country.

Don't you feel that that indicates that we need a substantially higher level of homebuilding with emphasis on sales and rental housing for families of modest income?

Mr. BRINKMAN. We do feel that there must be a high level of building, but we feel that that building can be accomplished by private industry just as it has been since the founding of the Republic if you will take the Government's hand out of the pockets of the taxpayers and let the private investment under favorable terms provide the money for private building of housing.

We agree that there should be a high level of housing, housing construction over the course of the next 10 years, when the rate of family formation will be going up, and on that there is no disagreement, but we do not feel that it is the function of the Federal Government to conduct that housing. We believe that private ownership can do it better than the Government if it is not handicapped by the Government competition.

Mr. ADDONIZIO. Mr. McDonough, any questions?

Mr. MCDONOUGH. Mr. Brinkman, did you follow the displacement of persons in the other areas besides Washington to any detailed degree?

Mr. BRINKMAN. Only in a general way. I know in many places people were simply forced under the same procedure to give up their property. It was taken from them. In some places an attempt was

made to find homes for them. It wasn't successful in many places. Part of them were placed in other housing, but a large part of them weren't. We know that to be a fact, and we have letters from some of our associations saying that the awards were in many cases inadequate and didn't cover the real value of the property, and that people lost their homes and were displaced.

Mr. MCDONOUGH. How many people were displaced here in Washington?

Mr. BRINKMAN. There were at least several hundred, and I think perhaps more than a thousand. I can't give you the exact figures. The information can be obtained from the authorities here.

Mr. MCDONOUGH. Was there any provision made to take care of all of them, or do you know where they went? Where did they go?

Mr. BRINKMAN. No, they don't know where they all went. They have lost track of them. Some attempt was made to place some of them. A minority of them I believe were placed in other housing but my recollection is that most of them or at least half of them weren't placed by the public authorities. They have been trying ever since to find some means of placing people who are going to be displaced here, but they haven't solved that problem.

I think some Members of the House are working on that problem now, and there is intended to be a reorganization of the procedures here in the District so that a better job can be done in that respect, but no legislation has been passed yet consolidating the effort, and it is a difficult job to find housing for these people of low income when they are thrown out of the homes that they had.

Mr. ADDONIZIO. Thank you for coming, Mr. Brinkman.

The committee will stand in recess until 10 o'clock tomorrow morning.

(Whereupon, at 12:20 p.m., the committee recessed.)

HOUSING ACT OF 1961

TUESDAY, MAY 2, 1961

HOUSE OF REPRESENTATIVES,

COMMITTEE ON BANKING AND CURRENCY,

SUBCOMMITTEE ON HOUSING,
Washington, D.C.

The subcommittee met at 10 a.m., pursuant to adjournment, in room 1301, New Office Building, Hon. Albert Rains (chairman of the subcommittee), presiding.

Present: Representatives Rains (presiding), Addonizio, Barrett, Mrs. Sullivan, Ashley, Mrs. Griffiths, and Derwinski.

Also present: Representative Miller.

Mr. RAINS. The committee will be in order. The other members are slightly delayed. I think we better start.

The first witnesses we have this morning are from the National Association of Home Builders, Jim Burke, president, and with him is Mr. Leonard Frank and Mr. Evans Buchanan, and our friends Joe McGrath and Herb Colton. We are glad to have all of you gentlemen.

The other members will be here shortly. They called in to say they are delayed in their offices, but I think we better proceed, so if you will have a seat you may proceed. I assume you want this statement in the record at the close of your testimony.

STATEMENT OF E. J. BURKE, JR., PRESIDENT, NATIONAL ASSOCIATION OF HOME BUILDERS, ACCOMPANIED BY LEONARD L. FRANK, CHAIRMAN, GOVERNMENT AFFAIRS DIVISION, W. EVANS BUCHANAN, CHAIRMAN, LEGISLATIVE COMMITTEE, JOSEPH B. MCGRATH AND HERBERT S. COLTON

Mr. BURKE. With your permission I would like to file my entire statement as submitted to the committee. In addition I have a policy statement adopted by our board of directors at its last annual convention in Chicago and also an analysis of mortgage maturities which was prepared several years ago by our economics department. I would like your permission to also file these for the record.

Mr. RAINS. It all may be included in the record.

Mr. BURKE. Thank you, sir.

I will give a brief summary of our position.

Mr. RAINS. You may proceed any way you see fit.

Mr. BURKE. Thank you. For your information I am E. J. Burke, Jr., this year's president of the National Association of Home Builders. We have approximately 358 local associations and more than 40,000 members throughout the United States. We have been