and to urge the Congress to authorize the new department without delay.

Mr. Chairman, I would like to say in conclusion, as I did in my testimony before the Senate, that there is a sense of great urgency about outer space in this Congress. I think the time has come to call upon Congress to turn its foremost attention to inner space.

As far as I know, the outer space has no overcrowding, and we do have overcrowding here. The matter is urgent. It affects people. It affects people right here and now, and I think now is the time for action.

Thank you very much, Mr. Chairman.

Mr. ADDONIZIo. Thank you, Mr. Shishkin. I must confess that I agree with your statement almost in toto. However, I am a little unhappy to see that you oppose section 607 which deals with increasing the amount of grant for nonresidential construction from 20 to 30 percent. As you know, in the past I was the one who was responsible for increasing from the original act of 1954. Two years ago we increased it to 20 percent. I feel that this additional 10-percent increase should be made because I have been convinced for some time that in order to properly solve the slum problems of our Nation, we have to consider very definitely these areas that are of nonresidential character.

I was hopeful that I would have the support of the AFL-CIO with respect to this question, and I would think offhand that rather than opposing what I think is certainly an effective instrument for helping to solve the slum problems of our Nation, you would instead be satisfied to ask for more money to meet the total question of slum clearance. I think that would be a far better solution than just opposing this type of amendment to the bill.

Mr. SHISHKIN. Well, Mr. Chairman, let me say that your concern with the problem is commendable. It is a real one and an urgent one. I don't feel, however, that in order to approach a real solution to this problem that we ought to subtract from what we are doing now to provide housing.

We ought to have this problem tackled by devices that can operate under their own steam and not to carve it out of a housing program at the expense of the real first need in our slum areas, and that is to help eliminate slums in which people are now living, rather than the industrial slums.

Mr. ADDONIZIO. I agree that certainly this is the desire and the objective, but I think that there has to be a better balance between the two. I think if we are going to solve this problem, we have to meet the total problem.

Mr. SHISHKIN. Well, we feel the only way that a balanced approach can be made is to add a separate program to the one for clearing the housing slums by provision for clearing the industrial slums, not at the expense of the housing portion of that program.

Mr. ADDONIZIO. Mr. Shishkin, you mentioned that there were nearly 750,000 construction workers out of work. The annual rate of housing starts I understand is around 1.2 million currently.

How much do you think that that rate will have to be increased to put these people back to work?

Mr. SHISHKIN. Well, realistically, Mr. Chairman, we feel that the kind of program we are dealing with here takes time to initiate and

get underway. We have to think in terms of longer periods than the immediate impact on the market, including the labor market, and for that reason we feel that our estimate over the next ten years of a minimum of 2.3 million units a year is the minimum which we ought to maintain in order to maintain high employment in the entire industry.

Mr. ADDONIZIO. Would you consider this in your opinion to be inflationary?

Mr. SHISHKIN. No, I do not. I think as a matter of fact, it would generate the kind of economic revival that will eliminate some of the inflationary forces that are playing on the scarcity market today.

Mr. ADDONIZIO. We have heard a lot of arguments against enacting this 40-year, no-downpayment mortgage provision and I think the principal argument is one of no equity. This is probably a valid argument, but don't you think that there are other overriding issues that should be considered in meeting this problem?

Mr. SHISHKIN. Well, my view is, Mr. Chairman, that the 40-year mortgage proposal is fully justified if at the same time action is taken. to reduce the interest rates. I think if the interest rates are reasonably reduced, the whole problem can be resolved without any of the consequences that have been raised here as a bogey by some of the witnesses before the committee.

Mr. ADDONIZIO. I have noticed recently that unions are increasing their investments in home mortgages. Do you think that the unions would be afraid to invest in a 40-year FHA loan?

Mr. SHISHKIN. No, and they are doing so now. As a matter of fact, we have a special program to that effect and we have a special counselor, Mr. Brookstaver, who is one of the leading experts in the field to advise our affiliates with regard to these programs.

Mr. ADDONIZIO. Now at page 14 of your statement, at the top of the page, you say you favor additional authorization for community facility loans, that you would like to see it increased from $50 million, which is in the present bill before us, H.R. 6028, to $100 million.

You wouldn't object to our increasing it even more than the $100 million, would you? The thinking of the Chairman is to increase it to even a higher figure. If I remember correctly, Mr. Beimiller, representing your organization, testified last year as to putting something like $2 billion into the program.

Mr. SHISHKIN. We feel that this is certainly reasonable, and we would entirely agree. The only reason why we made the specific proposal here is to meet the realities of the legislative process here. We felt that this recommendation at this time in connection with this particular piece of legislation would be the most realistic one, but we certainly would favor your leadership and Chairman Rains' leadership in providing a higher figure.

Mr. ADDONZIO. Now just the other day, Mr. Shishkin, Mr. Meany urged the Government to undertake a major public works program. Would you tell us briefly the kind of program he has in mind, and the reasons he feels it is necessary?

Mr. SHISHKIN. Well, as you known, Mr. Chairman, the present situation doesn't warrant some of these expressions of optimism that have been voiced over the past few months. The matter of unemployment is so extremely urgent that we feel where there is a need for

specific improvements in the communities for the kind of public works that are thoroughly warranted, that are meeting the real local need and reflecting the community demand for it, that that need ought to be met now, and without further delay. President Meany's proposals are for action that would not be delayed but for urgent quick action to meet the present situation in our economy, because if we don't pull the economy out of the present slump, we are going to have some pretty dire consequences, and will have substantial unemployment by the end of the year.

Mr. ADDONIZIO. Thank you very much.

Mr. SHISHKIN. May I have Mr. Seidman supplement that comment?

Mr. ADDONIZIO. Surely.

Mr. SEIDMAN. As we understand it, many of the local governments and local communities have projects which are often described as being on the shelf. We would like to get those projects off the shelf. We think this is a critical time when we need to provide jobs, when there is need for public works of the type that those projects would provide, and therefore we would like to see a large-scale public works program right now at the time when it is most needed.

Mr. ADDONIZIO. Thank you.

There are many more questions that I would like to ask but we are pressed for time.

Mr. SHISHKIN. May I ask Mr. Edelman if he has anything to supplement my statement here?

Mr. EDELMAN. Just to say very quickly, Mr. Chairman, that any adequate or any sufficient public works program at this time would certainly relate itself to the whole housing program in the most direct kind of way, and would facilitate and supplement and generally augment the effectiveness of a housing program in dealing with all types of social problems which many urban and rural areas are confronted with today.

Mr. ADDONIZIO. Mr. Barrett.

Mr. BARRETT. Mr. Chairman, I just want to say Mr. Shishkin certainly made a splendid statement, as he usually does when he comes before this committee. We are certainly happy to have you gentlemen here.

Mr. SHISHKIN. Thank you, Mr. Barrett.

Mr. ADDONIZIO. Thank you very much, gentlemen. We are pressed for time, so we will have to excuse you now.

Mr. SHISHKIN. Thank you, Mr. Chairman, I appreciate the opportunity very much.

(The statement of Jacob Clayman, administrative director, IUD, has been received and is inserted in the record at this point.)

STATEMENT OF JACOB CLAYMAN, ADMINISTRATIVE DIRECTOR INDUSTRIAL UNION DEPARTMENT, AFL-CIO

The Industrial Union Department, AFL-CIO, is gratified with this opportunity to outline its views on the Administration's proposals for legislative changes in the field of housing and urban renewal.

The I.U.D. speaks on behalf of more than 6 million industrial workers represented through 60 affiliated unions. These workers are hard hit by unemployment. They will benefit economically because programs designed to rebuild our aging cities and to provide homes to the American people, will also mean more jobs in the factories and at the building site.

Adequate housing at moderate prices, the elimination of slums and the building of good urban neighborhoods are also of major concern to these workers. Industrial workers are urban oriented and prefer to live within reasonable distance of their work. Where plants are located outside the urban centers, these workers have an urgent need for good, durable and moderately priced housing. The objectives of the Industrial Union Department, AFL-CIO, and of labor generally in the field of housing are consistent with the best interests of other Americans who share in the woes arising from rundown urban areas and the lack of good housing at prices they can afford to pay.

Housing has long been a built-in stabilizer within the U.S. economy.

Recov

ery from housing slumps have helped to lift the U.S. economy out of the recessions that have plagued it since World War II. Economists, financial writers and the housing industry are now expressing doubt about the recuperative vitality of housing without a strong program of Federal aid.

A recent survey among members of the National Association of Home Builders-reported in the financial press-showed that members of that organization foresaw only a modest pickup in home construction this year. Certainly, there is nothing in the current picture to justify the view that 1961 will be better than last year even with the modest pickup in the economy now being predicted.

Three hundred thousand fewer homes were built in 1960 than in 1959. Throughout the past decade, the United States has lagged seriously behind in meeting housing requirements. Given a continuation of the present population explosion and rate of family formation, the housing crisis will still be with this Nation a decade hence unless action is taken now to meet present and future needs.

President Kennedy took note of the housing problem in his state of the Union message, 10 days after taking office. He declared that: "Twelve long years after Congress declared our goal to be a 'decent home and a suitable environment for every American family,' we still have 25 million Americans living in substandard homes."

The industrial union department salutes this candid recognition of fact. In truth, the problem is of greater proportions even than that noted by the President. Slums are simply the hard core of the housing problem. As the President's proposals on housing and renewal indicate, the problem encompasses the health of the economy, our cities and the future of the entire Nation.

It would be well to look at the dimensions of what is termed the housing problem. While the slum picture is not as bad statistically as it was a decade ago, it is still the ugliest entry upon the housing inventory ledger.

Census figures put the number of deteriorating homes at 8.4 million at the end of 1960. Another 3 million homes were described as dilapidated.

Still another 4.3 million homes were reported as "sound" but lacking some or all plumbing facilities. Thus, the United States finds itself entering the seventh decade of the 20th century with more than one-fourth of its housing stock unfit for human habitation or in a rundown or unsatisfactory condition.

The job ahead is monumental. In the next decade, 34 million more of us must be housed. By 1970 population will be increasing at the rate of 3.6 million annually.

There will be 10 million more households by 1970. Families headed by males other than husbands will remain relatively stable at 1.2 million but those headed by females will increase by 700,000 to 5.2 million. The number of unattached males to be housed will increase by half a million to 2.7 million. The number of unattached women living outside family groups will soar by 2.4 million to 7.4 million in total.

All kinds of housing will be required. Single family housing both in suburban areas and inside the central city will obviously be required. If our cities are to be restored, the urgent need for middle-income multiple-dwelling units must be met. Small economic units for the unattached must be provided at prices that such persons can pay, and this must be almost entirely urban housing.

The growth in family units headed by women gives some small indication of public housing needs to come. The backlog of such needs already is enormous. Until that happy day comes when every American family can afford adequate nonsubsidized housing, there will be a need for public housing for low income families for the aged and for others now condemned to the slums.

Not long ago, the New York Regional Planning Association warned suburbanites that they have a direct interest in rebuilding the slum areas of the central city. Failure to rebuild the central city's blighted areas into livable communities

for those now inhabiting them, the planning group warned, would ultimately lead to slums in the very backyards of those now seeking escape in high income suburbs.

Population growth alone is exceeding the increase in our stock of moderateand low-priced homes. Compounding the situation is the deterioration of existing stocks of outmoded homes.

Last year's Presidential Commission on National Goals reported that 10 million additional homes will be required in the present decade just to keep up with new family formation. Another 10 million new homes will be needed to replace housing outmoded beyond repair while 10 million units of our present home inventory will require repair and improvement.

"Two million dwelling units per year is about 40 percent higher than the record output in 1950, and 60 percent more than the annual average for the decade. But this volume plus rehabilitation is well within the productive capacity of the construction industry. Indeed, the flood of new jobseekers calls for a 20 percent rise in jobs by 1970, and the Labor Department counts on an increase in construction opportunities 'much faster' than 20 percent as a major source of additional jobs," the Commission said.

Without effective Federal aid, the objectives in housing and renewal fought by the Commission on National Goals will not be met. Unless these objectives are met, the national economy will lag and unemployment will become even worse. Of equal importance, 1970 will find the Nation with millions of its population illhoused. While such a situation persists, the "affluent society" will be a joke and a mockery.

Today, the homebuilding industry is oriented toward the needs of the top 30 to 40 percent of the Nation's families. Given housing within the ability of the majority of the Nation's families to buy or rent, and a new housing boom will result that can carry the whole Nation to new heights of prosperity.

Particularly, there is a need for moderately priced middle-income housing within our cities. Here, in the area of multiple-dwelling units and row houses with the economies of construction they afford, should be the private homebuilders' crowning glory. Despite tax and other subsidies, this area generally has been marked by gloomy failure. Needed are city homes selling in the $8,000-to$9,500 bracket and apartments renting from $21 to $40 a room.

The problems of housing and urban renewal are obviously inseparable. The American city is bursting at the seams. Megalopolis-the urban complex of tomorrow-is already discernible in the continuous urban strip running from Portland, Maine, to Norfolk, Va.

If the inner city is permitted to decay, the urban-suburban complex will collapse. But the city cannot survive as a slum ghetto for the poor and for minorities, on the one hand, and isolated gilded ghettos for the rich, on the other. The city needs tax-base property for survival. This can be provided only with largescale, moderately priced, modern, nonsegregated housing in good neighborhoods for white- and blue-collar workers who want to pay their own way and who are urban oriented.

Title I of the Housing Act of 1949 must be used chiefly to provide middleincome housing for public housing purposes and for other sound economic steps to revive commercial and industrial property essential to city survival. Utilization of title I money to subsidize luxury housing, however, denies the spirit and purpose of the Housing Act of 1949. We urge that new safeguards to prevent the use of public subsidy for luxury housing be seriously considered by the Congress.

After long years of outright opposition to administration housing proposals, it is indeed a welcome relief to the industrial union department to be able to offer support for the housing objectives of the new administration. We regard the legislative proposals of the administration as a most desirable reversal of direction. We feel, however, that the proposed legislation is too modest and its pace too slow in view of the accumulated needs of the Nation.

In sending his housing message to the Congress, the President stated: "Urban renewal programs to date have been too narrow to cope effectively with the basic problems facing older cities. Our urban renewal efforts must be substantially reoriented from slum clearance and slum prevention into positive programs for economic and social regeneration."

While we are in thorough agreement with these objectives, we are of the view that they require long-term planning on a large scale. The President's proposals

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