were for this review procedure, and they were thinking in terms of existing programs largely. Our original testimony was to the effect that we would like to see this applied to all Federal programs; however, this would be a good, sensible way to start in on new programs, and we hadn't really anticipated significant revision, but I am sure we would support the idea of a periodic review being written into this. Senator MUSKIE. My own idea, as I express it here and simply to make the record complete, is that we ought to limit the bill to new programs for the purpose of acquiring some experience in dealing with this procedure. We have well over 59 grant-in-aid programs in effect now; if we were to apply the bill's provision to them overnight, we might very well find ourselves with an almost impossible staff problem, and a lot of good programs might be destroyed simply because the Congress is not equipped to effectively and efficiently review them.

Since we are stepping into a new field and technique in dealing with Federal grants, my own feeling is that we ought to make it clear that the bill is limited initially to new programs. Then we can move into existing programs as we pick up experience and know-how, and figure out ways to make the review process work effectively.

Mr. HILLENBRAND. One thing that you have discussed this morning, Mr. Senator, which would be helpful, is if the review period would commence at the end of 3 years instead of at the end of 4, we could begin to get some experience at a relatively early date which would be very helpful.

Senator MUSKIE. I think you would have another advantage. At the end of 4 years, we would have some indication as to whether there is likely to be a recommendation that the program be discontinued. This would give the supporters of the program an opportunity to adequately make their case, and they certainly ought to have that opportunity. Mr. MCMAHON. Could I add a word, Mr. Chairman? Senator MUSKIE. Yes, Mr. McMahon.

Mr. MCMAHON. Of course, you have to start somewhere, and this is the reason that we like this bill and we hope that it will be extended. However, there is one thing that you in your discussion with Senator Moss raised that might involve a look, and that is the Congress comes along and provides for a 3-year program or a 4-year program. Now in such a case as that, I take it from the terms of the bill it would not apply, because it says where no other provision has been made for an earlier termination.

We think so much of this principle we would hope that if the Congress were to provide for a 3-year termination or some such thing as that, the same procedure would be used in order that the same kind of discussion might go on between the congressional committees involved and the local and State officials involved in anticipation of that 4-year cutoff, because we think we could do the same thing. Senator MUSKIE. If it were a 4-year program, you could perhaps do that.

If you get down to 3 years you are beginning the review almost before the program gets started, and this presents some difficulty. But I agree with you that in principle there ought to be this kind of dialog going on between Federal and State levels of government on all grant-in-aid programs at all times.

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After all, it is a partnership effort, and all too seldom does the State partner get a real crack at proposals for improvements and changes in direction and policy. So I would agree with the principle.

Mr. MCMAHON. Even with the 3-year program it is quite likely that there will be an automatic extension, and we would hope that if provisions are put in for 3 years, that there might be a requirement for a report.

Senator MUSKIE. I suppose a 3-year term might be used as a way to bypass this.

Mr. MCMAHON. It could be.

Senator MUSKIE. If you have a 3-year program and then routinely extend it for 3 years, you might get around this bill. This is a loophole we will have to consider.

Are there any questions by other members of the committee?

I know Senator Mundt has been most interested in the county level of government.

Senator MUNDT. I don't know that I have a specific question, but, Mr. Chairman, I would like to associate myself with the statement Mr. Hillenbrand made about interest in having it apply to existing programs, because I share that sentiment, and I share it for two reasons: One is that the existing programs comprise about 10 percent of our annual budget. In fact, they will comprise more than 10 percent of the annual budget if Lyndon Johnson is successful in getting the budget under $100 billion a year which he is trying to do and I am going to help him.

So this is a real sizable chunk of activities which involves county governments, State and Federal governments, and I think we would be seriously remiss in our responsibilities if we simply said we have a $10 billion problem on our hands and we are not going to undertake to do anything about that, but we are going to do something about the new ones, because there is an interplay and an interrelationship between them.

Secondly, in my own experience as a member of the Appropriations Committee, I have found that we start a review of these programs right at the end of the first 12 months when a new one comes along, like area redevelopment. We don't do it as well as I think we should do, and this bill, I hope, will help remedy this.

We, however, begin reviewing the program right away. We say, "What have you found out?" This has been a kind of pilot demonstration. And invariably, or almost invariably, we don't appropriate as much money that first year as the authorization act would empower us to, because we want to take a look at it, and we would like to bring in the mechanism of this intercoordinated focusing of county, State, and Federal wisdom on these problems, and I think we can start on them right at the beginning of the first year.

I don't think we have to wait for 5 years, 3 years, or 4 years. Obviously, the longer you have, the better you are able to do it, and you are able to do it better if you bring in the best intelligence in Government on these problems.

That is one of the reasons I suggest getting an assist from the Comptroller General's office which is staffed adequately to provide facts and figures, and the raw material with which Congress and its witnesses can then work.

Senator BREWSTER. Mr. Chairman, just allow me to commend the Commissioner on a very lucid and interesting statement. I would also like to comment that I am very pleased to see that Mr. Bernard F. Hillenbrand, a most distinguished Marylander, is appearing before the committee this morning. We are glad to have him here. Mr. HILLENBRAND. Thank you very much.

Senator MUSKIE. You know, Mr. Hillenbrand has been so national in his approach to all these problems that it never occurred to me to wonder what State he comes from. I couldn't have told you his native State.

Senator MUNDT. He is here a good bit of the time.

Mr. HILLENBRAND. We are always anxious to advise and counsel. Senator MUNDT. We are always glad to have you.

Senator MUSKIE. I am delighted to see this bipartisan support of the principle that the President ought to be helped.

Gentlemen, if you have nothing more to add to your testimony, I want to join Senator Brewster in complimenting you on your statement. I think it is an excellent presentation of some very sound reasons. Thank you very much.

Mr. HAIGH. Thank you, Senator.

Senator MUSKIE. I will introduce the next witness and then I must apologize for having to leave.

The next witness is Mr. William Murtha, director, government operations and expenditures program of the U.S. Chamber of Com

merce.

We are delighted to have you here this morning. I always enjoy discussing public policy with representatives of the U.S. Chamber, and it is particularly pleasant to find ourselves on what I take it will be the same side of this question.

Mr. MURTHA. Thank you, Mr. Chairman. The satisfaction is mutual. It is very nice when this occurs.

Senator MUSKIE. Will you forgive me for having to depart? I leave you to the tender mercies of Senators Brewster and Mundt. Mr. MURTHA. Thank you, sir.

STATEMENT OF WILLIAM MURTHA, DIRECTOR, GOVERNMENT OPERATIONS AND EXPENDITURES PROGRAM, U.S. CHAMBER OF COMMERCE

Mr. MURTHA. I am William E. Murtha, director of the National Chamber's government operations and expenditures program, and am testifying today on behalf of the National Chamber.

The National Chamber strongly supports the basic objectives of S. 2114-the periodic review of Federal grant-in-aid programs. Currently, more than $10 billion is being spent for such programs. However, we recommend additional means for tightening the reins on this sharply increasing area of Federal expenditures.

Expenditures by State and local governments, from their own funds, have more than doubled in the period from 1954 to 1964. It should be emphasized, however, that in the same 10-year period, Federal aid to States and local governments has nearly quadrupled. The ques

tion naturally arises as to the ability of the Federal Government to continue financial participation at this greatly increasing rate. Important in this connection is the work of the Advisory Commission on Intergovernmental Relations, as well as the activities of this subcommittee in seeking areas for reevaluation and possible retrenchment in grant-in-aid programs.

Pressures for increased Federal spending are constantly mounting. To deal with these pressures, it is imperative that a very stringent set of priorities be established by the executive branch and the Congress to assure that the most essential national needs receive the resources they deserve, but that the less essential programs, although possibly desirable, be postponed or curtailed. Programs which are neither directly nor properly the responsibility of the Federal Government or which have served their purpose should be terminated.

The pledge in the President's State of the Union message that there would be some cutbacks in the forthcoming budget is encouraging. However, in this period of the greatest prosperity the Nation has ever experienced, we face a deficit estimated at about $5 billion. Thus, while significant budget reductions are indicated, there are also equally significant additions mentioned, some of which appear to carry with them a potential for growth which may far exceed any short-run savings. Therefore, with this overall budgetary picture in mind, the National Chamber strongly urges the Congress not only to establish the procedures called for in S. 2114, but to go still further.

To make S. 2114 more effective, it should be amended to require the periodic review of all Federal grant-in-aid programs rather than only those which may be enacted in the future. Certainly if the case can be made for the review of future programs, and this appears to be widely accepted, an even stronger case can be made for review of those grant-in-aid programs already on the statute books, some of them for more than 100 years. A provision along the lines of that contained in H.R. 6176, introduced by Representative Charles E. Goodell of New York, would appear to satisfy this recommendation. Section 3(b) of H.R. 6176 would simply apply the same requirement for periodic reauthorization to existing grant-in-aid programs as well as to those approved in the future.

While our second recommendation for strengthening the bill is largely administrative, the Congress can promote and, in fact, require a much better coordinated surveillance and analysis of grants-in-aid in the executive branch than presently exists. The most appropriate place for this operation would be in the Bureau of the Budget, as an arm of the Executive Office of the President. Our information is that the Bureau of the Budget does not now devote any significant effort toward getting greater coordination and administrative review and analysis of the many and diverse grant-in-aid programs-now accounting for about 10 percent of total Federal expenditures.

In his communication of December 12, 1963, the chairman of this subcommittee requested that witnesses comment on Senator Karl E. Mundt's proposed amendment to S. 2114. We have reviewed the amendment of Senator Mundt and fully agree that any assistance the Comptroller General and the staff of the General Accounting Office might provide Congress with respect to studies of Federal grant-inaid programs would be extremely valuable. Therefore, we favor adop

tion of the concept embodied in the Mundt amendment. However, this should be viewed as an additional tool for evaluation of Federal grant-in-aid programs. It would not eliminate the need for much stronger administrative review within the executive branch. And specifically it would not eliminate the need for automatic termination of grant-in-aid programs at 5-year intervals, unless specifically reauthorized by Congress.

It should be generally recognized that the automatic termination provision of S. 2114 is the real strength of the bill in that it will require Congress, every 5 years, to take a long hard look at each grant-inaid program, and then decide whether or not it should continue as before, be revised, curtailed, or terminated.

Let me point out that the National Chamber is for the concept of periodic review, but we have not taken a position as to whether 5 years is the most appropriate period for accomplishing the aims of review.

I would like to place special emphasis on the need for periodic congressional review because there has developed, over the years, a subtle attempt to shift the burden of proof when it comes to Federal spending. For many years, proponents of Federal spending programs were required to justify their programs. Increasingly, opponents of Federal spending programs are being asked to justify their opposition. Let the burden of proof rest precisely where it belongs-on those who are program proponents.

Our membership has consistently supported, as being in the public interest, legislation of the type we are now discussing, legislation which helps to assure the individual citizen that his tax dollars are being used as efficiently and effectively as possible.

In conclusion, we urge adoption of S. 2114 together with the changes I have outlined. Such action would go a long way toward strengthening congressional and executive control over Federal grant-in-aid programs.

I thank you very much, gentlemen, for allowing us to appear and present the views of the National Chamber.

Senator BREWSTER. Thank you very much, sir.

Senator Mundt, questions or comment?

Senator MUNDT. No questions.

I think the statement speaks for itself and is very effective. It represents exactly the constructive viewpoint I would expect to come from the source from which it came, and I want to express my appreciation for the support of the amendment which I have proposed.

I would like to reiterate the fact that what we have here is a very simple piece of legislation that provides really just a few new elements. Number one, it provides for a review, and injects a terminal date so as to provide the time when this thing becomes effective. If you take the terminal date out, and if you don't make it apply to existing programs, and unless you bring into operation the Comptroller General's Office, there are the three new elements; if you do none of those you do nothing.

Now, I resent what some columnists have said, that this has been a do-nothing Congress.

Mr. MURTHA. We didn't say that.

Senator MUNDT. No, you didn't, but as a Member of Congress I resent that, but I would resent even more valid criticism which could