December 3, 1970
Page 39764
THE PROXMIRE AMENDMENT
Mr. BYRD of Virginia. Mr. President, I support the pending amendment offered by the distinguished Senator from Wisconsin, for himself, for Mr. BYRD of Virginia, Mr. COOK and Mr. PERCY. My position is not new. I took the same position as long ago as 5 years.
My concern about this matter of a supersonic transport is twofold: First, I do not think it is realistic to expect the taxpayers to finance 85 percent of the development costs of this aircraft.
Were it a more reasonable ratio, I might take a different view. But most certainly the aircraft companies should put up more than 15 percent. My second concern is with the total overall cost in this period of high inflation.
The amount under consideration is $290 million, but that is only a part of the total program, which will be a minimum of $1.3 billion. It could run a great deal higher than that. While it may be a desirable program, I am not convinced that it is an essential one at the present time.
I support the position of the Senator from Wisconsin, I shall vote against the $290 million appropriation. I think Senator PROXMIRE has done an excellent job in developing facts in regard to the amendment which he has presented, and I support that amendment for the reasons I have just outlined.
Mr. PROXMIRE. Mr. President, will the Senator from Virginia yield?
Mr. BYRD of Virginia. I yield.
Mr. PROXMIRE. I wish to thank the Senator from Virginia for his speech, and I want to tell him that I think he has hit a very crucial part of the problem. The cost of developing this plan is very likely to be far more than $1.3 billion to the Federal Government because of the overrun problem. Once we get beyond that, there is every indication from the Department of Transportation itself that we are going to have to put in another billion dollars or so to help along on production. So it could be an extraordinarily expensive operation.
I think the Senator from Virginia has done a superb job – as fine as any Senator since I have been here – in fighting wasteful expenditures and insisting on priorities which makes sense.
Mr. MAGNUSON. Mr. President, I yield myself 5 minutes.
In the first place, there literally is no evidence about any overrun on this project. The Senator from Wisconsin keeps talking about it, but it just does not exist.
Any project may have rising costs because of inflation, but in this case it is not true. Everyone says, including General Electric, the subcontractors of Boeing, and Boeing itself, that they do not feel that they need to go over the $1.3 billion. There is no evidence at all about an overrun.
Mr. PROXMIRE. Mr. President, will the Senator yield at that point?
Mr. MAGNUSON. No, just a minute. I want to finish. The Senator has already talked a long, long time.
The Senator from Virginia talks about the taxpayers and public money. But no one mentions that there is a payback provision in this contract. It is a little like when we started to build dams and public work projects – they all have a payback provision. They could not be financed by any one individual, any one county, or any private utility, so, as in the case of the Grand Coulee Dam, for instance, the Government furnished the money to build the job, and we were paid back with 3-percent interest. In those days 3-percent interest was fairly decent; today, it may not be. But there was a payback provision.
In this case, all the airlines and everyone else agreed that they would start with a royalty of 5 percent and pay the Government back, because it was too big a project for any company to take on by itself. In fact, as I said yesterday, it was too big a job in Europe for even one country to take on; they had to put two together, and now they may have a third one, West Germany, in a possible consortium to build the second generation Concorde. That is, of course, for the second generation; these things take years.
Mr. JACKSON. Mr. President, will the Senator yield at that point?
Mr. MAGNUSON. Yes.
Mr. JACKSON. Is it not a fact that if this program is terminated, a letter from Mr. Magruder which is on every Senator's desk, dated December 2, on the second page, states that:
The program cancellation at this time could require a total Treasury outlay of as much as $277.8 million.
Mr. MAGNUSON. Yes. I shall put the letter in the RECORD.
We are talking about a $290 million appropriation – could I get the attention of the Senator from Wisconsin for a minute? The Senator from Maine, too. A $290 million appropriation, and if it were canceled, we would have to appropriate $277 million.
Mr. PROXMIRE. Will the Senator permit us to answer, or permit us to ask a question, or does he prefer not to deal with these things point by point?
Mr. MAGNUSON. I have the floor, yes. I want to put this in the RECORD. We are talking about priorities.
No one understands priorities and the social and welfare needs of the Nation better than the Senator from Washington. I have sat on the Appropriations Committees for years, and have tried to do a good job. It is a hoax to say to people that because you cancel this project, the money is going to end up being spent on social welfare programs.
In the first place, if we cancel it, we are going to have to appropriate $277 million right now, in the next supplemental. Let us get this straight right now.
Now, that has nothing to do with whether we should cancel it or not; but Senators ought to know what we are getting into if we vote for Senator PROXMIRE.
I want to put in the RECORD at this point the letter and the up to date figures on what would be the Federal obligation if this program were not carried forward.
Mr. JACKSON. Mr. President, will the Senator yield further on that same point?
Mr. MAGNUSON. Yes.
Mr. JACKSON. Is it not a fact that if this program is not completed, that is, the contract calling for two prototypes and that is all that is involved here;we are not talking about a production program, but only a research and development program – if it did turn out that the two prototypes are not suitable for production purposes, and if it should turn out, in that connection, that the law is not complied with as we passed it yesterday, is it not true that the prime contractors and those associated with the project would lose all the money they have put in it?
Mr. MAGNUSON. Every bit.
The PRESIDING OFFICER. The Senator's time has expired.
Mr. MAGNUSON. I yield myself 5 more minutes, or such time as I need.
Mr. JACKSON. And in that case, as I understand it, the amount involved exceeds $200 million by a rather wide margin, for the one company.
Mr. MAGNUSON. By quite a wide margin; and there are taxes involved here, if they do go on with it, of $10.5 billion, and the balance of payments runs $6 billion one way or $6 billion the other way.
The Concorde is now up for sale, and the Russians have sold 4 to the Japanese, as I understand, and we are just out of it. This is a little like our merchant marine; we had the impetus after World War II, we lost it, and we never got it back. We are still struggling.
As to the royalties, there is no suggestion – every suggestion, every program, all the commissions that have studied this matter have agreed that the royalties would be paid back to the Government as soon as they fly. The Treasury investment would exceed the investment of $1 billion, of which $728 million, I believe, is already in this project.
This is nothing new, we have done it for all kinds of things. So I just want to point out, surely, it is a loan, but we have loaned a lot of money around the United States to develop things, to aid transportation, to aid our environment, to aid our rivers and harbors – hydroelectric projects and everything else. We spent more than this amount of money in the first few years of our air transport system just on subsidies alone, to keep it moving so they could buy the airplanes; otherwise, we would have had to subsidize the manufacturers, if they had not been under subsidies.
We have done it for the railroads, inland waterways – we have probably invested close to $8 billion in locks in inland waterways, so that we could have inland waterway transportation. This is not paid back, but it is a loan.
I just wanted that clear; and to be real up to date, I ask unanimous consent to have printed in the RECORD, from the Office of the Secretary, certified by the Treasury, the figures that show that this is what we would have to do if the contract was canceled, and it will add up, on January 1, 1971, to $277.8 million.
Mr. BIBLE. Mr. President, will the Senator yield?
Mr. MAGNUSON. Yes.
Mr. BIBLE. I have no objection to that being put in the RECORD, but I put it in myself earlier.
Mr. MAGNUSON. All right, then, it is already in.
Mr. ALLEN. Mr. President, will the Senator yield?
Mr. MAGNUSON. I ask unanimous consent to put in the RECORD also a letter dated December 2, 1970, from the Airport Operators Council. These are the people that operate the airports. They strongly endorse this program, now that we have provided the assurance of lower noise levels in the bill passed yesterday. I do not know whether this has been put in the RECORD or not; but I think once in a while someone ought to mention that this is only a loan. It is a loan to keep our American air transport industry moving forward. If we lose it now, we will never get it back.
There being no objection, the letter was ordered to be printed in the RECORD, as follows:
DECEMBER 2, 1970.
Re SST Appropriation – fiscal year 1971.
Hon. WARREN G. MAGNUSON,
Chairman, Committee on Commerce,
United States Senate,
Washington, D.C.
DEAR SENATOR MAGNUSON : The Airport Operators Council International (AOCI) fully supports your amendment to S. 4547, accepted by the Senate this afternoon, which provides assurances that the U.S. SST's aircraft noise levels will not exceed those of new subsonic jet aircraft.
As offered in the Senate, your amendment adds a new Subsection (i) to S. 4547 as reported out of the Senate Commerce Committee as follows:
"Subsection (i)
The Department of Transportation shall modify its contracts with the contractors for the civil supersonic transport development program to provide that the contracts will not be satisfactorily completed until the contractors demonstrate that all production models of the prototype can operate in compliance with appendix C of Part 36 of the Federal Aviation Regulations now restricting takeoff, approach and sideline noise created by new subsonic jet aircraft as in effect on the date of enactment of this subsection."
In our earlier and widely reported statements on the SST appropriation, we stated our support for the development of an environmentally-sound SST. To assure that this objective would be met, AOCI, representing all the communities in the United States which are likely candidates to receive service from the first-generation SST, stated that the pending $290 million SST appropriation for FY '71 should be approved by the Senate only if there were a requirement that all production models of the aircraft meet the same noise standards now established in Appendix C of Part 36 of the Federal Aviation Regulations for subsonic aircraft and with the same trade-off provisions.
The amendment to S. 4547 adopted by the Senate today satisfies the airport operators' SST aircraft noise concern. Thus, we fully support action by the Senate to appropriate the full $290 million SST appropriation for FY '71. And, with the approval of this new statutory provision, AOCI can find no basis for any vote against the SST appropriation because of the aircraft's noise effect on communities.
Further, Congressional action to set definitive noise standards for SST operation will provide an additional impetus for SST aircraft produced by other nations to meet the same noise restrictions. Airport operators will be unable to convince their communities that service by any SST aircraft should be permitted which exceeds limits which the U.S. SST will be required to meet.
We are most appreciative of your continuing efforts to support the development of new technologically advanced aircraft which are also environmentally compatible with existing airports and their adjacent communities.
Sincerely,
HOMER B. ANDERSON.
President.
Mr. PERCY. Mr. President, will the Senator yield at that point?
Mr. MAGNUSON. I yield.
Mr. PERCY. I could not possibly accept the Senator's contention that this is a loan in any conventional sense. There is not a banker in the world today who would accept a loan on this basis. In fact, as I said yesterday, I would be quite willing to introduce legislation to remove the airlines' whole obligation to repay the Government, in order to get the Government out of this project. Even on this basis, there is not a single banker who would accept the risk.
Mr. MAGNUSON. Well, there would not have been a banker who would have floated the bonds for the Grand Coulee Dam, either.
Mr. PERCY. I know, but we have made it a matter of national policy for 200 years in this country that such projects as the Grand Coulee Dam are public projects.
Mr. MAGNUSON. All right; you people probably interpret loans differently but I firmly disagree.
Mr. PERCY. A loan implies a payback.
Mr. MAGNUSON. Nobody mentions that we are going to get the money back. If that is not a loan, I do not know what is a loan.
Mr. PROXMIRE. Will the Senator yield, for just a comment on this?
Mr. BIBLE. And then will the Senator yield to me?
Mr. MAGNUSON. No, I have the floor. There is no use arguing; I just want to point out that every consideration here, and every contract, involves a pay-back to the Government. Does the Senator agree?
The PRESIDING OFFICER (Mr. BELLMON). The time of the Senator has expired.
Who yields time?
Mr. PROXMIRE. Mr. President–
Mr. MAGNUSON. I have the floor. I ask for 2 additional minutes.
Mr. BIBLE. I yield 2 minutes to the Senator from Washington.
Mr. President, I hope the time taken up with these interruptions is divided as to the Senator who is asking the question and the Senator who is answering them. We have approximately 16 minutes remaining, and the other side has 74.
I yield 2 minutes to the Senator from Washington.
Mr. MAGNUSON. Mr. President, the Senate has heard extensive debate on the civil supersonic aircraft – SST-development program. The Appropriations Committee recommends completion of the prototype development program. A decision to halt funding of the SST program would mean the loss of all of the $708.4 million appropriated to date plus $277.8 million in costs associated with termination. This does not include the reimbursement of the dollars contributed by the airlines for which a moral obligation of reimbursement by the Government may exceed $58.5 million.
The age of commercial supersonic air travel is here. Other nations are already well into the testing phases of commercial supersonic aircraft. The British-French Concorde has already flown at Mach 2. The United States has no real alternative to that of proceeding with the construction and flight testing of the two SST prototypes. We must maintain our capability for production of a U.S. SST for delivery to airlines in the latter part of this decade. Failure to do so would result in irretrievable losses in world aviation leadership, aviation industry employment, and exports of civil aircraft, one of the few remaining positive balance of trade accounts.
United States exports of commercial aircraft have shown a strong positive trade balance over the past 10 years in the U.S./Foreign Trade Exchange. Failure of the United States to enter the SST market would result in a total unfavorable balance of trade effect in the aircraft account which the administration conservatively estimates at $22 billion but which could run as high as $45.6 billion between 1978 and 1990.
The SST program is not a Government subsidy. In 1961 the U.S. Government concluded that it was essential to develop a commercial supersonic transport. Accordingly, the Government sponsored a competition for manufacturers to determine who would build the airframe and the engines. The U.S. Government has remained a partner, along with the airlines and the manufacturers, and has a contractual obligation to complete the prototype program. The Government is involved because of the magnitude of the funding required, as are the British, French, and Soviet Governments in the Concorde and TU-144 programs. However, the U.S. program is an investment shared by the manufacturers, airlines, and the Government. The Government's investment will be fully returned through royalties on aircraft sales by the sale of the 300th airplane. A conservative market forecast for sales of U.S. SST's is 500 aircraft; by the sale of the 500th aircraft the Government will recover in royalties every dollar of its investment plus an additional billion dollars. In addition to the royalty payments, it is estimated that, by 1990, the Government will also receive $6 to $7 billion in corporate and personal taxes as a result of SST production.
Concern has been expressed by some that the SST could have an adverse effect upon our environment. The Appropriations Committee, of which I am a member, has firmly taken the position that we will not "buy aviation leadership at further cost to our environment."
Environmental questions were explored thoroughly in our hearings and a number of witnesses testified on these matters. There does not appear to be any evidence or factual substantiation that the SST will have a harmful effect on the environment. The charge is made that the SST will greatly pollute the atmosphere. Yet, jet aircraft provides a cleaner mode of transportation per passenger mile of travel than any other mode of mass transportation.
The theory has been postulated that the SST will alter the world's climate by introduction of water vapor or particulates into the upper atmosphere, or that a possible alternation of ozone content in the upper atmosphere will increase ultraviolet radiation at the earth's surface to hazardous levels. The experts quoted by the critics who raise these points admit that these conclusions are mere speculation, unsubstantiated by any factual evidence.
All available scientific data from military supersonic flights, which total over 500,000 hours of supersonic flight, fails to substantiate the speculation of the SST critics. It is admitted by all, including the opponents of the SST, that the development and flight of the two prototype SST aircraft will not have any significant impact on the environment. Despite the lack of evidence that the SST will have a detrimental impact on the environment, the DOT has formed an interagency environmental research program as well as a committee of many of the foremost environmental experts in the country to make certain that all questions regarding possible adverse environmental effects are answered prior to mass production of the SST.
Aircraft flying at speeds in excess of sound create sonic booms. The Government's policy, however, is that the U.S. SST will not be allowed to fly over land at speeds or conditions that would cause a sonic boom to reach the ground. Just yesterday the Senate passed S. 4547, the sonic boom bill, which would prohibit faster-than-sound airliners’ flights over U.S. territory and it would also restrict airport noise levels made by the SST. This bill would prevent either U.S. or foreign-made aircraft from overland flights over U.S. territory. The same ban was proposed by the Federal Aviation Administration, but now the Senate has written it into law.
The sonic boom bill also requires the Transportation Department to modify its contract with the Boeing Co. to provide that the plane will be canceled unless its prototype models comply with current FAA regulations restricting takeoff, approach, and "sideline" noise created by the SST.
I feel that this is a strong guarantee to those environmentalists who fear that persistent sonic booms and unreasonable airport noise created by the SST would not be prevented. Some critics also feel that economic demand will require supersonic flights over land. The passage of S. 4547 would ban these overland flights, and such flight would not have been needed in any case to make the SST economically successful.
Concern has been raised over the question of emission from the SST. This problem, however, has been covered under the Air Quality Control Act which was passed earlier this year by the Senate. Regulations regarding aircraft emission are being set by the Department of Health, Education, and Welfare.
Similar misunderstandings exist with respect to aircraft noise. The amount of noise associated with the SST has been incorrectly overstated by many of the program's opponents. Aircraft takeoff and approach noise is the type of noise about which people who live in communities adjacent to airports complain. The community noise level from an SST will be less than that of existing commercial jets. The "sideline" noise of the SST, which is confined almost entirely to the airport, is anticipated to be about equal to the noise made by the present jets and the manufacturers are working diligently to insure that goal.
Production of the U.S. SST will bring direct employment to 50,000 workers in American industry over a 15-year period. In addition, 100,000 jobs will be created as a secondary effect of the direct jobs.
In addition to the future effect of the production SST program on employment and revenue levels, the current SST prototype program has an immediate favorable effect on employment in U.S. industry. This effect – 20,000 of the direct labor force working on the prototype program – will help stabilize employment at a time when the aviation industry has been following a marked downward trend since mid-1968.
I want to suggest something else: This has nothing to do with the merits or demerits of the supersonic transport. But I have another reason for this. Almost 100,000 people are walking the streets in two counties in Washington, and everybody, including the Federal Government, is trying to find jobs for them. I do not know what better thing we can do than to put them back to work on something that is going to be worthwhile for the future of America.
This is a personal matter. It is pretty serious. It just happens that situation exists in my State. We do not have a lot of jobs involved. We have only half of the contract, and approximately 78 percent of that is going to be done by subcontractors. But every job counts out in my Washington today.
I want to point out that I have a particular reason for getting people back to work, doing something good for the future of the United States.
Mr. PROXMIRE. Mr. President, I yield myself 2 minutes, and then I will yield to the Senator from Maine and the Senator from Alabama.
The Senator from Washington said that there have been no overruns on this program. There have been overruns. There is an overrun now of $57 million, which was testified to by the Department of Transportation in the hearings before the Joint Economic Committee.
In addition, we know that these programs rarely have overruns in the research and development stage. That comes in production. There is every indication that there will be an overrun, because they are using brand new, exotic metal; and the experience has been consistently in production that when you get into a new technology, you have adjustments and changes, and they result in overruns.
The Senator from Washington talked about the termination settlement of $270 million. Take the amount of money that has already been spent in this fiscal year, because we are part way through it, add to that the $85 or $95 million required under the contract, and they come up with something that they argue is close to $230 million, $240 million, or $250 million. The fact is that if we go ahead with it this year, when they come in with the supersonic transport next year, it will be the same story. They will say, "Here it is October or November 1971. The termination costs are going to be $250 million. You might as well go ahead with it."
If we are going to stop the SST, the time to stop it is now. Next year, it will cost that much more.
The PRESIDING OFFICER. The time of the Senator has expired.
Mr. PROXMIRE. I yield myself 2 additional minutes.
Mr. President, so far as payback is concerned, they say this is only a loan. As the Senator from Illinois pointed out, this is a very peculiar loan, indeed. This is the kind of loan in which you do not even get your money back if it works out. All the risk is on the Federal Government. I should not say all the risk – 90 percent of it. The Federal Government will put in 85 to 90 percent of the money. If this does not work out – as I pointed out earlier, there are many contingencies under which it would not – the Federal Government loses it. If this does work out, however, the Federal Government can get back, at most, what it has put in, plus 6 percent interest; and the Federal Government has to pay 7 or 8 percent interest for its money now. So there is no way in which the taxpayer can come out whole on this program.
It is a subsidy, with virtually all the risk taken by the Federal Government, and with the Federal Government in a position not to benefit even if it works out satisfactorily. Under almost all circumstances, the producer and the airlines benefit, because even if only 139 of these planes are produced – as Dr. John Walgreen predicts would happen – the Federal Government will lose all its money and the manufacturers make $500 million.
Mr. President, I yield 10 minutes to the Senator from Maine.
Mr. MUSKIE. I thank the distinguished Senator from Wisconsin.
Mr. President, there has been a great deal of debate in Congress and in the country as to whether we should proceed at all with the construction of a supersonic transport. I am not sure that I can add anything to that debate. Yet, I think the situation is so serious that it is important to emphasize the elements of that debate.
The administration says that we should proceed now, and that Congress should appropriate another $290 million for two prototype aircraft.
In my judgment, the administration is mistaken.
Almost 2 years ago, President Nixon appointed an ad hoc committee to review the supersonic transport program.
The members of that committee were members of this administration.
They include Under Secretaries of Commerce; of Health, Education, and Welfare; of the Interior; of State; of the Treasury.
They include officials of the Defense Department, the Justice Department the Labor Department, the Council of Economic Advisers, the National Aeronautics and Space Administration.
They included the President's own science adviser.
They heard the testimony of witnesses, both in favor of the SST and against it. And they submitted a report to the President which was clear, comprehensive, and straightforward – a report which the President chose not to publicize. We have had access to it only because it was leaked.
That report is most instructive. It said:
If the U.S. overall balance of payments is considered, there is substantial reason for delay in proceeding to the next stage of the SST project-prototype production.
It said:
The record to date (as to whether an SST can be built in the given time that will meet the specifications of being efficient, safe and economical) is not completely reassuring.
It said:
Supersonic transport has the potential for intensifying hazards to the passengers and crew, and for causing significant further deterioration in the environment for people on the ground . . .
That is what the report said, among other things.
How did the President respond to these warnings?
Apparently, by ignoring them.
For none of the uncertainties which the President's hand-picked committee reported in March 1969 has since been resolved.
The committee concluded that the noise produced by SST operations would be "intolerable" to a "very high percentage of the exposed population."
Yet, no measurable progress has been made since the committee met on reducing the level of that noise.
The committee found that the introduction of water vapor into the stratosphere as a result of SST flights might affect our atmosphere adversely.
Sufficient research has not been conducted – since the committee met – to assess these risks more accurately.
The committee emphasized that "there is an urgent need to carefully evaluate the inherent operational and environmental hazards that will be encountered while accelerating from zero to Mach 3 and cruising at supersonic speeds in a hostile environment."
Has that evaluation been made since the committee met? It has not. And we do not yet know the extent of the hazards which may exist.
These are the questions which the administration should answer – and answer fully – before Congress appropriates another $290 million.
Mr. PROXMIRE. Mr. President, will the Senator from Maine yield at that point?
Mr. MUSKIE. I yield.
Mr. PROXMIRE. This is the first time in the past few days that the ad hoc committee's report has been brought into this debate. I think it is most significant that it has, because this was a committee appointed by President Nixon and he selected those most competent to give him information as to the impact of the SST in various areas. They were experts.
As the Senator has pointed out so well here, the answer was just overwhelming. It was complete and clear, that the SST was not worth the millions in additional money that would be required.
Virtually with no exception, the Council of Economic Advisers, the Treasury Department, the Office of Science and Technology, the Labor Department – all agreed that this was not the way to spend the money.
I think the fact that the Senator from Maine has brought this out is very useful because it has escaped our attention and we have not got back to that inquiry, which was a year ago and was probably the most comprehensive inquiry made on the subject of the SST.
Mr. MUSKIE. May I say that I referred to the report for another reason. As the Senator knows, he and I have been undertaking to get from the administration, especially from the environmental agencies, their current evaluation of the environmental risks associated with this project. The question arose in the hearings on the conference with Mr. Ruckelshaus as the Administrator of the new Environmental Protection Agency. The Senator and I joined in a letter to Secretary Volpe of the Department of Transportation, requesting that those reports of those evaluations, which we understand have been made, be made available to the House and Senate while this debate is in progress.
We have received no such reports. We have received no indication of cooperation. For some reason, the administration does not want us to have those evaluations to influence the Senate at this point in this debate.
May I say to the Senator–
Mr. PROXMIRE. Along that line
Mr. MUSKIE. I have received evidence today, which is revealing, as to why they do not want us to have those evaluations. It is because those evaluations concern the very warnings, the very questions which were raised by the President's ad hoc committee in the report to which I have already referred this afternoon.
I do not know whether I should be reading from these documents, as I do not want to prejudice my sources of information. But let me read an excerpt from one, on the noise factor – and this is an evaluation made in November of this year, 1970:
There is recognition in the Nation that the SST may generate more severe sideline noise relative to that currently produced by four-engined subsonic jet transports. Noise data filed in an FAA report suggests a three-to five-fold increase in the perceived noises of SST sideline sounds over that of conventional jet aircraft now in service.
Mr. MURPHY. Mr. President, will the Senator from Maine yield at that point?
Mr. MUSKIE. Mr. President, this report goes on beyond that, to suggest–
Mr. MURPHY. Mr. President, will the Senator from Maine yield for a question?
Mr. MUSKIE. I will be happy to yield to the Senator in a moment. Let me suggest that the standards now applicable to subsonic aircraft may be compromised in the interests of meeting the degree of technological problems faced by the SST in meeting such standards, and that this is why these environmental evaluations are not being made available to the Senate during the course of this debate.
Now I am happy to yield to the Senator from California.
Mr. MURPHY. I thank the Senator. Mr. President, I wonder whether the Senator was apprized of the information given to this body yesterday by the Senator from Arizona (Mr. GOLDWATER), when the same question was raised about the sideline noise, when he pointed out that it seemed impossible to know what the sideline noise would be inasmuch as the engines have not even been built yet.
Was the Senator aware of that?
Mr. MUSKIE. There have been supersonic engines built–
Mr. MURPHY. Oh, yes.
Mr. MUSKIE. I will get to that point in my prepared remarks in a moment. The report has given us evidence upon which to raise these questions about sideline noise. I am not saying to the Senator from California what the answers to the questions are. I am raising the questions. I am saying to the Senator and to the Senate that these questions should be answered before this project goes forward. The Senator from California is therefore supporting my own argument by what he has just said.
Mr. MURPHY. If the Senator will yield further, it is my understanding that the Senator from Maine said he was reading from some report which he hesitated as to whether it should be read. The basis of the report I do not know, but as I understood it, it stated that the sideline noises would be unacceptable – I am paraphrasing that.
Mr. MUSKIE. May I say to the Senator from California that I want him to understand the basis of the question to which he is responding. No. 1, this information is available to the executive branch, which is your party. It is available to others – to your President – he is my President, too [laughter] but this information is available. The Senator does not have to take my word for what is in the report. It is available if the administration chooses to make it available.
Mr. MURPHY. I am not questioning its availability
Mr. MUSKIE. This report raises these questions. It does not answer them.
Mr. MURPHY. I merely pointed out, if the distinguished Senator from Maine would bear with me–
Mr. MUSKIE. My time is limited, may I say to the Senator. I would be happy to answer any questions but I cannot give the Senator my time to make a speech.
Mr. MURPHY. The Senator has not answered the question.
Mr. MUSKIE. I have tried to, but the senator prolongs his question into a speech.
Mr. MURPHY. The Senator has made his point. I merely asked him if he was aware of the information given to this body yesterday by the Senator from Arizona (Mr. GOLDWATER) in direct dialog.
Mr. MUSKIE. I have tried to follow what the Senator was asking.
Mr. MURPHY. The Senator has not yet answered the question. He has made some statements about whether information is available. If it is, I do not know why he was so hesitant as to whether it should be read at this point.
Mr. MUSKIE. I will say this: I have had some indication, as a result of activities in the Department of the Interior recently, of the disciplinary measures that may be taken in the executive branch against employees who do not want to meet the pleasure of the administration. This information has been made available to Congress, not officially, but it has been leaked. I do not intend to prejudice the "leaker" this afternoon. [ Laughter.]
With all respect to the Senator from California, I am now going to proceed with my prepared statement. I am always interested in engaging in colloquy with the Senator from California, but I would like to finish my statement now so that I do not consume too much of the time available to this side on this issue. If there is time left over, I will be glad to get back to the Senator's question
Mr. MURPHY. I point out that the Senator has not yet answered the question.
Mr. MUSKIE. If the question is whether I have read every word in the CONGRESSIONAL RECORD on this debate, the answer is "No; I have not read it all." That would take more time than any Senator has these days.
Mr. MURPHY. Mr. President, will the Senator from Maine yield?
The PRESIDING OFFICER (Mr. BELLMON). The Senator declines to yield further.
Mr. MUSKIE. It is impossible for me to read every word in the RECORD. I am aware of the arguments, however, plus the statements made by the Senator from Arizona (Mr. GOLDWATER). I am not convinced by them. I have no particular position, information, or knowledge on which to answer the question as to what will be the sideline noise, or what will be its effect on health. It is precisely because I do not have that answer, not because some particular answer is urged, but because we do not have that answer, that I believe we should not go forward with this project. That is my answer to the question of the Senator from California.
Mr. MAGNUSON. Mr. President, will the Senator from Maine yield on my time?
Mr. MUSKIE. I yield.
Mr. BIBLE. Mr. President, I yield the Senator 1 minute for the purpose of answering the question.
The PRESIDING OFFICER. The Senator from Washington is recognized for 1 minute.
Mr. MAGNUSON. Mr. President, we passed a bill yesterday on which I will stake my reputation as a Senator. We have defined allowable sideline noise to be that noise is now allowable for 707's, 747's, or the DC-9's. That is going to be the law of the land.
Mr. MUSKIE. Mr. President, may I answer that on the Senator's time?
Mr. BIBLE. The Senator can answer it on his own time.
Mr. MUSKIE. Then I will not answer it.
Mr. MAGNUSON. Was the Senator aware of the amendment?
Mr. MUSKIE. I also know that laws can be repealed. The answer to the argument made a while ago to the effect that another reason why we ought to spend this $290 million is that we have already spent so many millions of dollars. If we spend this additional $290 million and we cannot meet the test established in the law passed yesterday, the economic pressure will be on again. The argument will be made that we have already spent an additional $290 million; so we should repeal that law or modify it to reflect the economic or technological limitations of the SST. That is what we want to avoid, I say to the distinguished Senator from Washington.
Mr. President, now, if I may, I will resume my speech.
The administration seems to be operating on the assumption that it must not prove anything at all.
It argues that this is not the time to answer questions about the possible adverse effects of an SST, because we would not be committed to its production – we would be committed only to building prototypes.
It has been argued that the development of two prototype supersonic transports is necessary to learn about the environmental aspects of SST operation. Standing alone, the argument has plausibility. Considered in context, it is wholly without foundation.
Since the early 1950's the United States has been engaged in the development and production of a large number of different types of aircraft with supersonic capability. In fact, almost all Air Force and Navy combat aircraft have supersonic capability. And these are not just small aircraft but have included the world's only operational supersonic bomber – the B-58. Although the Air Force has recently withdrawn the B-58 from active service, several hundred were produced and it formed an essential component of SAC for many years.
In addition, the Department of Defense has developed and accumulated flight experience on a huge prototype supersonic bomber – the B-70. Many other aircraft could, of course, be mentioned: the infamous TFX or F-111, the Phantom, the entire F-100 series of the Air Force, the X-15, the SR-71 and, although not supersonic but operating at high altitudes, the U-2. The SR-71 in fact is a high altitude supersonic aircraft that could certainly be utilized for research purposes.
It is clear then, that operational aircraft have existed, and do exist, to perform all of the research and experiment analysis that must be performed. Building two additional supersonic aircraft at a cost of some $290 million is an abhorrent waste of taxpayers' money at a time when everyone acknowledges the Government must exercise fiscal restraint.
What is needed is for the Department of Defense to open its records on the operation and characteristics of supersonic aircraft and to work in conjunction with the Department of Transportation and the National Academy of Sciences to develop research programs with existing aircraft to test these environmental problems that are likely to be created by the SST.
I am informed that many of the Nation's most outstanding atmospheric scientists have attempted to get information from the DOD on the characteristic of supersonic flight relevant to environmental analysis – such as Dr. Reid Bryson at the University of Wisconsin – and have been denied. The information developed by the military must be and can be made available to answer the questions raised by supersonic flight and DOD research should be directed to develop any necessary information which does not exist.
It is sheer folly to argue that two new aircraft are necessary to generate answers when similar aircraft are already flying.
And, Mr. President, that argument misses the fundamental reason why the SST has become a symbol to millions of Americans, and why this appropriations request must be rejected.
To devote $290 million now to a continuation of the SST program would simply be a gross misallocation of our resources.
In terms of transportation, the SST does not begin to compare with our need to revitalize our intercity rail service, or to reconstruct our urban mass transit systems.
In terms of aviation, the SST does not begin to compare with our need to build new and improved airports for the planes we already fly, or to develop new short-haul aircraft.
In terms of our most urgent national priorities, the SST does not begin to compare with our need to train sufficient health care personnel, to find better ways of protecting our environment, to provide adequate housing.
The administration argues that the United States must start spending $290 million more to stay competitive.
But competitive with what?
The Concorde, for example, has by no means proven itself a serious threat to American civil aviation manufacturers.
Although options are currently outstanding for 74 Concordes, not one of these options has been exercised.
Indeed, the presidents of Pan American, Tras World Airlines, United Airlines, have all – in recent weeks – been reported as expressing skepticism over the economic viability of these new aircraft.
And why?
Because to operate them at a profit might require a 30- to 40-percent increase in airfares.
Because their sonic boom – in the light of the Senate action of yesterday – would prevent flights over restricted geographic areas.
Because their initial capital cost could prove unacceptable for airlines hard-pressed to pay for the jumbo jets already on order.
Clearly, the SST is not a necessity.
It is a luxury – a luxury that few taxpayers would ever enjoy – a luxury that we cannot afford now.
I recognize, of course, that the money for an SST would provide jobs for some Americans whose security has been threatened by the deliberately restrictive fiscal and monetary policies of the last 2 years.
But no one can argue seriously that an SST is the best project – or even one of the best – for putting men to work, or for restoring health and vitality to our economy as a whole.
Indeed, the President's own ad hoc committee to review the SST program concluded last year that the employment which an SST would support "should not be considered as a justification for proceeding with the program.”
The time has come for us in the Senate to consider not just the immediate interests of one private company, but the long-range interest of the Nation; not just the appropriations request for a single project, but the overall balance between what is critical in our budget and what is not; not just the prototype of a supersonic transport, but the example of a responsible Congress.
The time has come for us to face reality.
On all of these counts it seems to me obvious, irresistible, and inevitable that the time has come for us to say "No" to this appropriation.
Mr. PROXMIRE. I thank the Senator. I yield 10 minutes to the Senator from Alabama.
Mr. MAGNUSON. Mr. President, will the Senator withhold briefly so that I may yield myself 1 minute in order to place some material in the RECORD?
Mr. ALLEN. Mr. President, I am glad to withhold my remarks briefly so that the Senator may place material in the RECORD, without the time being charged to me.
Mr. MAGNUSON. Mr. President, I ask unanimous consent to have printed in the RECORD letters from the president of Pan American World Airways and Trans World Airlines. In addition, we have telegrams from the airlines that they all are most enthusiastic about the SST and have not changed their position one iota, which I ask now to have printed in the RECORD.
There being no objection, the material was ordered to be printed in the RECORD, as follows:
PAN AMERICAN WORLD AIRWAYS,
May 4, 1970.
The Honorable RICHARD B. RUSSELL,
Chairman, Senate Appropriations Committee,
United States Senate,
Washington, D.C.
DEAR MR. CHAIRMAN: This is to assure you that Pan American World Airways continues to stand behind the U.S. program for the development of a supersonic transport, and has the expectation of being able in the late 1970s to fulfill its plan for the purchase of fifteen of the first American-built supersonic airliners.
Pan Am has the alternative of relying solely upon supersonic airliners built by the
manufacturers of some other country. This company already has options to purchase eight Concordes. And the Soviet Union is developing the TU 144, an aircraft similar to the Concorde, which will undoubtedly be offered to purchasers in the free world after the requirements of the Socialist airlines have been fulfilled.
But Pan Am nevertheless continues to stand behind the American program for these principal reasons:
1. The supersonic transport will be a significant contribution to expanding the use of human time and human talent, improving high-level international communication and to widening the travel and educational opportunities available to the average citizen.
2. To perform the public service we are confident it can perform, the supersonic transport must be capable of economic operation, and the record of the last 35 years confirms that American aerospace manufacturers have a better ability than the manufacturers of other countries to build large transports that operate economically.
3. Pan Am believes that a supersonic transport must be socially acceptable and operate without damage or disturbance to the public and the environment, and we believe that the best chance of having a supersonic airliner that conforms to the proper social and ecological standards is to have it built here under American control. With our route pattern preponderantly over water, we will not project a sonic boom on occupied areas.
4. The United States cannot prevent the rest of the world from building, selling and using faster airplanes. Their construction and use is in fact inevitable, once the safe, sound and socially desirable model is designed. The only question is whether and to what extent the supersonic transports operated by the world's airlines, and utilized by the people of the world, will be built in the U.S. with the rewards going to American labor and to American capital, or whether the world production of the supersonic transport will rest with other countries.
5. As an airline facing intense and worldwide competition (by a total of 92 other airlines most of which are state-owned or subsidized), Pan Am will have no choice but to operate supersonic transports as soon as foreign-flag airlines are able to do so even though initial foreign aircraft may fall short of economic objectives. We would prefer to do so on the basis of following Pan Am's historic policy of encouraging development of the American manufacturing industry.
Time is running against the United States aerospace industry and, to the extent it can produce a superior SST, against United States airlines, Mr. Chairman. Should the American project be much delayed, the market for it will be reduced through (1) the greater availability of Concordes and TU 144s, and (2) the development of improved versions of those two aircraft.
We therefore believe the program should proceed on a deliberate, orderly, efficient basis as a national investment in the future of an ever more efficient and publicly useful system of worldwide transportation.
Sincerely,
N. E. HALABY.
TRANS WORLD AIRLINES.
New York, N.Y.,
May 20, 1970.
Mr. WILLIAM M. MAGRUDER,
Director-SST Development Program,
Department of Transportation,
Washington, D.C.
DEAR MR. MAGRUDER: In view of the current Congressional hearings regarding the U.S. SST program, I thought it would be in order for TWA to express its views on this matter.
It is our strong view that the best interests of the United States require that the U.S. Supersonic Transport Program be carried through to completion vigorously and expeditiously.
Supersonic travel will bring great benefits to the traveling public and to the cause of international understanding. The initial family of subsonic jets provided a major breakthrough in the ease and convenience of travel, with resulting benefits to those traveling in furtherance of their business interests, as well as those traveling for their own pleasure, education or cultural advancement.
The much greater saving in time with the supersonic transport will, we are confident, represent another major breakthrough, still further encouraging the interchange of cultural, social, and business interests.
In any case, the issue which faces the United States at this time is not whether there shall be a supersonic era in air travel. This is practically upon us with the continuing development of supersonic aircraft by the British and French as well as by the Russians.
The real issue which confronts the United States is whether this country will be an active participant in the development and sale of this new family of aircraft, or whether we will turn over to other countries the leadership in aeronautical technology which we have so long held.
This acknowledged leadership of the United States in aeronautical matters has paid great dividends to this country thus far. Quite apart from the intangible considerations of national prestige, the sale of U.S.-manufactured aircraft has meant a great contribution to our balance of payments, and has meant related benefits for employment of U.S. labor and capital.
The same benefits can continue in the future if the United States is prepared to become a full and active participant in the supersonic era of aircraft development. This will not only mean the capability for improving our balance of payments by export sales to foreign purchasers; it can prevent the erosion of our balance of payments picture which would otherwise occur if U.S.flag operators are themselves compelled to look abroad for the availability of supersonic transports.
Clearly, supersonic transport operations must satisfy reasonable environmental requirements with regard to noise and related matters. We are satisfied that this will be the case. Sufficient flight paths will exist to permit the limitation of the supersonic phase of operations to non-populated areas, with restrictions to subsonic speeds over populated areas. We believe such operation to be feasible and acceptable. At the same time, we would expect that further progress in the alleviation of engine noise and sonic boom intensity will result from continued future research, thereby eventually permitting operations to be conducted with fewer such restrictions.
In conclusion, our view remains as previously expressed, namely, that the varied interests of the United States Government and the United States public will best be served by actively proceeding with the development of a U.S. supersonic transport, so as to obtain a superior and economically viable aircraft at the earliest practical time.
Sincerely,
F. C. WISER.
NOVEMBER 24, 1970.
Honorable R. RUSSELL,
Chairman, Senate Appropriations Committee,
U.S. Senate,
Washington, D.C.:
I have heard that my recent remarks in London and elsewhere regarding supersonic transportation have been misinterpreted as a change from the Pan Am position stated in my letter to you of May 4,1970. This is to let you know that we stand on that letter and are convinced that our country should proceed with the program as proposed.
N. E. HALABY,
President, Pan Am Airways.
NOVEMBER 25, 1970.
WILLIAM M. MAGRUDER,
Director, SST Development Program,
Department of Transportation,
Washington, D.C.:
This is to reaffirm to you that the views on the U.S. SST program expressed in my letter of May 20 to you remain my views. Continuation of the U.S. supersonic transport development program is believed to be in the best interest of the United States since it will help maintain a strong aircraft industry and a favorable balance of payments situation.
F. C. WISER,
President, Trans World Airlines.
Mr. MUSKIE. Mr. President, I ask unanimous consent to have printed in the RECORD news stories upon which my argument earlier this afternoon was based.
There being no objection, the news article was ordered to be printed in the RECORD, as follows:
PAN AM, TWA SEEKING TESTS BEFORE BUYING CONCORDE JETS
(By Robert J. Samuelson)
America's two major international airlines – Pan American World Airways and Trans World Airlines – are becoming increasingly leery of making a large commitment for rapid delivery of the British-French Concorde supersonic jet.
The airlines' growing wariness has surfaced over the last two weeks during individual trips to Europe of the carriers' presidents, Najeeb Halaby of Pan Am and F. C. Wiser of TWA.
Neither of the airline presidents departed from the industry's long-standing support for a supersonic aircraft. Nevertheless, their reservations on Concorde could have implications for an American SST program.
Any major slowdown in the Concorde would provide strong ammunition for critics of the U.S. project, now awaiting $290 million funding from the Senate. Proponents of an American SST have consistently argued that a U.S. plane is required to prevent the loss of a major aircraft market – ultimately worth billions of dollars, they say – to the Europeans by default.
Likewise, if the Concorde were to be delayed and development of the U.S. plane proceeds on schedule, the British-French aircraft would lose its major selling advantage over a bigger, faster American SST, a four- or five-year head start.
Pan Am's Halaby, in London a week ago, made a straightforward appeal for delay. Citing the technical complexities of a new supersonic transport which lacks a military forerunner, Halaby proposed that mass production of the Concorde – now undergoing flight tests – be postponed until a consortium of international airlines has subjected the plane to extensive operational checks by flying it on regular commercial routes.
"We are confident, but skeptical (of the plane)," Halaby said in an interview with the London Financial Times. "The airline industry does not want to plunge into this new era without cautiously testing Concorde before it commits itself."
Just a few days earlier, speaking in Geneva, TWA's Wiser said the Concorde would be a money "loser" unless travelers are willing to pay a ticket surcharge of 30 to 40 per cent more than today's first class and economy rates.
The airlines' apparent cautiousness reflects two longstanding reservations about the Concorde – and, indirectly, an American SST.
First, the airline industry, now burdened with huge debts to purchase a new generation of jumbo jets, simply won't be able to raise sufficient capital to pay for the Concordes, priced at more than $20 million each. Inflation and the economic slowdown, which has limited traffic growth, have weakened airline profits to the point where some analysts fear that carriers will have to cancel orders for jumbo jets – planes for which substantial "progress" payments have already been made.
Second, the Concorde, despite its higher speed (last week, it reached twice the speed of sound), will cost more to operate than the present subsonic jets. The Concorde will seat only 114 to 144 passengers against 360 for the Boeing 747; the British Aircraft Corp., one of the Concorde's major manufacturers, says the supersonic plane will cost about 36 per cent more to operate than a 747.
Neither of these problems is of recent origin, and the Concorde's backers tend to see Pan Am's and TWA's recent outburst of criticism as an attempt to improve their bargaining positions approaching price negotiations.
The British and French have received 74 "options" for the Concorde, with Pan Am (8) and TWA (6) representing two of the heaviest commitments. An "option," however, required only a minimal payment (reportedly between $100,000 and $250,000). The real negotiations to buy the supersonic planes should begin in late 1970 and early 1971.
"We have been expecting some fairly tough comments to come out of the airlines who are in early delivery positions," says a British Aircraft Corp. spokesman.
One knowledgeable American official, Bernard Vierling, deputy director of the U.S. SST project, agrees. "They (the airlines) are doing some negotiating in public," he says.
Halaby's proposal may also be an attempt to ease the burden of simultaneously financing Boeing 747s and Concords by deferring deliveries of the supersonic jet.
According to industry observers, even airlines that do not want the Concorde would be forced to buy it if their competitors purchase the faster plane. "We've got to fly the things if the British and the French do," say both TWA and Pan Am.
Halaby's prolonged tests would postpone this day of reckoning. The first deliveries are now scheduled for late 1973 or early 1974. As he describes it, the program of extended flights – he did not say who would pay for the trials – would involve several large airlines. They would fly regular routes, possibly transport some demonstration groups, but probably not sell tickets to the general public.
The Concorde's manufacturers do not like the plan. Of 4,000 hours of planned flight testing, 1,500 hours are already marked for operational problems in which airline pilots probably will take part.
"We are not going to ask early-delivery airlines (those receiving the Concorde first) to do development testing for us," Edwin H. Burgess, British Aircraft Corp.'s sales manager for Concorde, said in a Washington speech last week.
The corporation's officials don't seem perturbed by the other problem raised by the airlines – the ticket surcharge. Without a surcharge, they say, passengers would flock from the subsonic planes to the Concorde, even though the narrow-bodied supersonic jet will be less roomy than the Boeing 747.
"I cannot see supersonic aircraft operating without surcharge," Burgess said. However, British Aircraft Corp. officials have also suggested that the Concorde be converted exclusively to first-class passengers. In that case, they say, ticket prices would probably remain the same or might even drop.
The maneuvering over Concorde has imprecise implications for the American SST project.
The first Concorde is expected to be delivered four or five years ahead of the target date for the initial American SST. Because the American plane will seat more people (more than 300) and is projected to fly faster, any prolonged deliveries would tend to favor the American plane,
Halaby specifically denied that his suggestion is a "ploy."
"I am not trying to get a lead for the U.S. aircraft." he said. "It is a bigger, faster, more expensive machine than Concorde and so ought to be subjected to the same tests before the airlines commit themselves to buy it.”
Mr. MAGNUSON. These letters are from the people themselves.
Mr. MUSKIE. These news stories can be verified by the writers of the letters if they choose.