June 8, 1971
Page 18760
Mr. MUSKIE. Mr. President, I wish to express my support for S. 575 and most particularly title I providing for an accelerated Public Works Act of 1971. Since most of S. 575 is similar to legislation already passed by the Senate, I wish to confine my remarks to title I which is a new section proposed by the House Committee on Public Works, passed by the House on April 22, and accepted by a majority of the Senate conferees. I consider this section a reasoned and needed response to the presently deteriorating economy.
Title I authorizes $2 billion immediately for public works projects in designated "redevelopment areas" and "economic development centers" or in areas with 6-percent unemployment. In the case of grants-in-aid for local public works projects involving a local cost share, the emergency grant can be made to cover up to 80 percent of the cost of the project. In addition, a 100 percent grant can be made in those areas where the State or local government have completely exhausted their respective taxing and borrowing capacity and cannot, therefore, meet the local matching grant requirement. The bill directs that "priority is to be given by the President to projects for assistance in the construction of basic public works – including work for the storage, treatment, purification, or distribution of water and sewage treatment, and sewage facilities – and for which there is an urgent and vital public need."
Emphasis would be given to projects which can be completed within 1 year with the use of local contractors employing substantial amounts of local labor.
A cursory review of the present economy shows the need for this title. Unemployment is at the intolerable level of 6.1 percent for the entire work force. This is further refutation of the administration's overly optimistic projection of a $1,065 billion gross national product. Even this projection assumes an unacceptable unemployment rate of 5 percent. The American economy is now operating $70 billion below its full potential. Clearly, additional measures are needed to create jobs. The present deficit budget does not create these jobs. It is not expansive and does not provide necessary stimulus to our economy.
Title I is patterned after the Public Works Acceleration Act of 1962 and the accomplishments of that act suggest that this new bill will create the jobs and the income needed to stimulate the economy. The 1962 act created jobs and developed public facilities at low administrative cost.
The 1962 act, in a little less than 2 years, provided $861 million for more than 7,700 public works projects. These projects were located in 1,000 counties in 50 States and three Territories. In less than 2 years, it has been estimated that the 1962 act generated approximately 210,000 man-years of on-site and off-site employment. By the end of the first year, 6,811 projects had been started or completed. The on-site employment rose steadily from 3,800 workers in November 1962 to 35,000 workers in June 1963 to a peak of 45,500 employed on-site in June 1964. Given the proper will, we can match these achievements in the next 2 years.
Title I has the dual purpose of increasing employment in areas of greatest need and providing communities with basic and long-neglected facilities, such as water and sewage works, hospital and road improvement, public buildings, and the like. It meets the needs of local citizens and, at the same time, paves the way for the future expansion of the economy. It will create about 170,000 or more badly needed jobs within the year. The overall impact of this title could increase employment by as much as 420,000 jobs.
These jobs will not be make-work or leaf-raking jobs. They are jobs that need to be done. For example, there is a backlog of applications involving nearly $6 billion in Federal funds from communities to help build over 6,000 waste treatment plants, water and sewage facilities, hospitals, nursing homes, and public health centers. In addition, there is a backlog of $3 billion in Federal projects ready for construction. These projects represent decisions of national and local officials of what is needed for local development.
The 1962 act was of particular benefit to rural areas. Over 50 percent of the projects were in areas designated as rural development areas.
Furthermore, the 1962 act allowed the construction of facilities greatly needed by this country.
Forty-eight percent of all the types of facilities built were water treatment, water and sewage projects, and other public facilities. It can be safely said that, particularly in rural areas, many of these desperately needed water treatment and sewage facilities would not have been built except for the impetus and the additional funds provided by the 1962 act.
Maine's present total unemployment is 8.2 percent – the highest since 1960. A recent manpower study of the Lubeck area of Washington County in Maine shows unemployment in January of 22 percent. In the Lewiston-Auburn area, the unemployment rate in March was 10.5 percent. Many of these unemployed Maine citizens and citizens throughout this country would benefit from this bill.
Returning veterans from Vietnam would also benefit from this bill. Fifteen percent of all returning Vietnam veterans are now unemployed. These veterans need jobs now to lessen the hardship of a painful transition from Vietnam to a peacetime occupation at home.
Also, it should be admitted that the accelerated public works program is not and does not pretend to be a permanent solution to the unemployment problem. It does not offer returning veterans a permanent occupation. But it does offer a way of handling the problem until we get our economy going again and develop other measures necessary to solve our unemployment problem.
The accelerated public works program is not inflationary. It provides for wages instead of unemployment and welfare checks. Men at work add to this Nation's productivity. Men paid for work provide not only needed purchasing power, but also a multiplier effect for the whole economy.
The accelerated public works program is in stark contrast with the President's proposed depreciation changes. The President's proposals will cost almost $40 billion in the first decade of its operation. The President's proposal may create some jobs, but essentially it is a tax cut for big business with little benefit to the average American. Not only is Congress without a real voice in proposed economic policy involving substantial loss of Federal revenue, but the funds for its own initiatives such as accelerated public works or the emergency employment act could easily be exhausted by the President's proposal.
Finally, some seem to have a monolithic concept of what constitutes public works. Many public works involve large construction, including long planning and construction lead time, but many are not. For many public works projects, construction can start immediately, providing jobs for the unemployed.
Also, this bill focuses its funds where the area of need is greatest. It recognizes that unemployment is not spread evenly throughout the country.
The bill has merit. Given the proper administrative will, it can provide a useful answer to our present problems. This bill is not a cure-all, but it would be folly to fail to do something because we cannot do everything at once.