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FEDERAL ROLE IN URBAN AFFAIRS

WEDNESDAY, DECEMBER 14, 1966

U.S. SENATE,
SUBCOMMITTEE ON EXECUTIVE REORGANIZATION,
COMMITTEE ON GOVERNMENT OPERATIONS,

Washington, D.C. The subcommittee met, pursuant to recess, at 10:05 a.m., in room 318, Old Senate Office Building, Senator Abraham Ribicoff (chairman) presiding.

Present: Senators Ribicoff, Kennedy (New York), and Javits.

Also present : Jerome Sonosky, staff director and general counsel; Esther Newberg, chief clerk; Robert Wager, assistant counsel; Paul Danaceau and Richard Bowen, professional staff members, Subcommittee on Executive Reorganization; James R. Calloway, chief clerk and staff director, and Eli E. Nobleman, professional staff member, Committee on Government Operations.

Senator RIBICOFF. The committee will be in order.

Our witnesses today will be McGeorge Bundy, president of the Ford Foundation; Joseph Monserrat, national director of the migration division, department of labor of Puerto Rico; Whitney M. Young, executive director of the National Urban League; and Howard Leary, commissioner of police of New York City.

Mr. Bundy, would you please come forward and bring with you anyone from your staff that

you

would like. There is no one for whom I have a higher respect, whether you are at Harvard, working for the Government, or with the Ford Foundation. I think you are one of the most constructive men in America, and I am so pleased that you honor the subcommittee, Mr. Bundy, by being with us today. STATEMENT OF McGEORGE BUNDY, PRESIDENT, FORD FOUNDA

TION; ACCOMPANIED BY LOUIS WINNICK AND JOHN COLEMAN, PROGRAM OFFICERS, FORD FOUNDATION Mr. BUNDY. Mr. Chairman, it is the other way around. It is a great pleasure for me to be here and to have a chance to take part in these discussions.

I would like to introduce two of my colleagues from the Ford Foundation, Mr. Louis Winnick, who is our program officer responsible for our programs in our urban and metropolitan development, and Mr. John Coleman, who is our program officer concerned with what we call social development, which is the field of enlarging opportunities for those who have less than they should in our society.

I have a statement here. I don't know whether it would be your pleasure to have me read it or simply to file it for the record.

Senator RIBICOFF. Whatever would suit you. It will go into the record. The statement is short, and you might read it as a basis for discussion, and at any time you want to depart, feel free to do so.

Mr. Bundy. Thank you very much. Mr. Chairman and members of the subcommittee, first, let me join with earlier witnesses to state my sense of deep obligation to you and to Senator Kennedy and to Senator Javits. Starting with the telling testimony of Senators themselves, these hearings have been a model of responsible and searching inquiry. Your staff has been kind enough to let us see some of the transcripts even before they are printed, and I do want to say I think there is a mine of information and insight in the record of these hearings which is sure to be helpful in colleges and universities and to everyone who cares about the American city.

As one who has come only lately to the close study of urban problems, I can tell you that these hearings have been very instructive to me.

FORD FOUNDATION ACTIVE IN CITY PROGRAMS

But if I am a beginner, the foundation I represent is not. Under my predecessor, Henry Heald, and with the particular leadership of my colleague Paul Ylvisaker, the Ford Foundation has been a leader in work for the cities. This work will continue. In the last 9 months it has been a part of my job to learn about the record of the foundation in this field, and to make some first assessments of the course which it should take in the future.

The first thing I have learned is that there is almost no domestic activity of this foundation which is not related, in one way or another, to the work of the city. We have very large programs in education; most of the schools and colleges with which we deal are in cities. We have a major program in the arts—and the arts are a mainly urban enterprise. We are deeply engaged in problems of population; both the research we support and the problems at which it is aimed are concentrated in the cities. If you were to ask me the same question that you have asked the executive branch—“Just how much money are you putting into the cities?”—I would not be able to give you a precise answer. It depends on what you are talking about.

BROAD PROBLEMS ARE RECOGNIZED

Still when witnesses before your subcommittee have talked of urgent current urban problems they seem to have the same broad agenda, in mind, and it is the same one that we have learned to recognize at the Ford Foundation : too few jobs in too many slums, with not enough housing, and schools that fail to move their children forward; racial discrimination and prejudice; tightly coiled and often alienated youth; violence, crime and narcotics; ineffective transportation; dirty air and water; weaknesses in the delivery system of health and welfare; overlapping and conflicting politicai and administrative jurisdictions; a desperate shortage of trained personnel and of flexible financial resources; a failure to engage the great skills and energies of the private sector. The list begins and ends with productive jobs, but it would be a desperate error to ignore the great issues in between.

In one way or another, this foundation is concerned with every one of these problems. Moreover, in nearly every one we are in touch, or

try to be in touch, with the work of others. My colleagues give particular attention to their duty to keep in touch with the staff of Federal agencies, and with experts here on the Hill. We try to learn from each other's experience, and we sometimes share in the financing of the same projects. Yet I should emphasize that while our purposes are similar, there are also great differences between us. A foundation cannot presume to be a government, and it has responsibilities and obligations of its own. I think you will agree that it is important for these distinctions to be preserved.

FOUNDATION'S RESOURCES ARE LIMITED First, I must emphasize again the difference in scale. Leaving aside the problem of classification of which I spoke a moment ago, and omitting many major grants to major institutions in the cities, like the University of Chicago, NYU, and Columbia, the Ford Foundation in recent years has been making grants and appropriations at a rate of about $30 million a year for specifically urban problems. We hope that this figure may rise, especially in the field of the social development of minority groups, a matter which we now regard as deserving top priority. But we are heavily engaged in the developing countries; we are deeply committed to the support of all forms of education; we have commitments to the arts, to television, to conservation and to population; and our resources,large as they are—are limited.

I underline this point simply because too often men of good will will make the wrong assumption that what the Government does not do, for one reason or another, the Ford Foundation will. Very occasionally, and for very special purposes, we are able to pick up marginal items which for one reason or another the Government cannot finance. But to suggest any equality between the resources of Government and the resources of a foundation even as large as ours is to make an error of about three zeros—the Government is literally 1,000 times bigger than we are.

ADVANTAGES OF THE PRIVATE FOUNDATION

It is also true, of course, that we have some special advantagesderiving in part from our relative smallness. The bulk of Federal urban spending takes the form either of federally operated programs such as the FĦA or—on a still larger scale of grants in aid to State, city, and county governments. By contrast, the Ford Foundation conducts no domestic operating programs of its own, and most of our grants go to private institutions. Since we have no need to build up large staffs we can move relatively quickly from old subjects to new ones. We are also free of the political push and pull that inevitably affects most government-to-government grants in aid. Moreover, we can usually move more quickly in making grants and appropriations than Washington, because of the complex machinery of Congress and the executive branch for authorization, appropriation, and administrative decision. The guidance which our trustees give our officers usually is more general and flexible than is the case with congressional guidance to the executive branch. Moreover, we can pick our projects with less concern for instant results, with less fear of political criticism or a hostile headline, and with greater tolerance for possible failure. I do not say for a minute that all these advantages make us wiser or more effective than our friends in Government. Even small institutions can have too much bureaucracy and too little imagination. But we do have the opportunities of these advantages, and if we make use of them, they can compensate in some degree for the vast gap in the relative size of our resources.

TWO QUESTIONS ARE CONSIDERED

Yet this limitation on funds makes it essential for us to examine every possible grant in the light of two questions: First, will a small amount of our money be likely to induce from some other source a larger and more lasting commitment of resources, and, second, does the project open some new possibility that may permit públic and private institutions to carry out their own assignments more effectively?

These questions do not have easy answers, and we often make mistakes. As we look for leverage and innovation we have to make judgments about the quality of ideas, the quality of men, and the influence that their work can have beyond the particular project which we may assist. We have tried to work in different ways with nearly every group

and institution that is concerned with the city. Let me cite only a few examples, to give a flavor of our effort.

FORD FOUNDATION HELPS SUPPORT OIC PROGRAM

We have been among the early and energetic supporters of the OICthe opportunities industrialization centers which are communityowned and operated vocational training centers for unemployed slum dwellers. These centers, which began in Philadelphia under the leadership of the Reverend Leon Sullivan—with growing support from local businessmen-have demonstrated the power of new approaches to job training. A similar center has been established in Watts, with our help, and Federal funds are now moving in to extend the experiment to a number of additional cities. Our interest in the OIČ reflects our deep convictions that nothing is more important than decent jobs for all who live in our cities, and that each community has resources of ideas and leadership which may be mobilized for self-help.

SEED MONEY HELPS ESTABLISH COMMUNITY CORPORATIONS

Another of our concerns has been the nonprofit community development corporation, a vehicle by which the industrial and financial interests of an urban area can band together and engage in a variety of developmental activities, especially new housing and urban renewal. As you know, such corporations have done important work in Pittsburgh, Philadelphia, Hartford, and elsewhere. Alongside such areawide corporations, we are also interested in the encouragement of neighborhood nonprofit housing and rehabilitation corporations. We find that with a few thousand dollars of seed money, well-organized corporations can win access to millions of dollars in Federal or local mortgage loans. This is an example of what we mean by leverage.

In addition to our support for new organizations, we have a deep interest in the encouragement of existing institutions to make full use

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