ADMINISTRATION CONTINUES TO PILE ERROR UPON IN SOUTH VIETNAM

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP66B00403R000200140030-0
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 4
• Document Creation Date: December 16, 2016
• Document Release Date: February 2, 2005
• Sequence Number: 30
• Publication Date: May 13, 1964
• Content Type: OPEN

1964 Approved Forcksli
Thus, the rates and terms of sale of adver-
tising, which is an important component of
the price of most consumer products, is
largely unregulated.
Similarly, publishers, broadcasters, and
networks have taken false shelter under the
doctrine of freedom of the press to engage
in price fixing and other monopoly practices
in the sale of essential news, editorial, and
programing services. It is currently reported
that the three television networks now own
or have profit participations in all but 15
of the hnndreds of programs they carry.
These participations and "coproduction" con-
cessions have been coerced from independent
producers and advertisers in exchange for
time clearances and preferences.
The afternoon panel on "Consumer
Credit: Truth in Lending" included the
following participants: Dr. Warren
Banner, Research Director, National
Urban League; Professor Persia Camp-
bell, chairman, Department of Econom-
ics, Queens College; Louis J. Asterita,
deputy manager, American Bankers As-
sociation. The following are excerpts
from their remarks.
From the remarks of Lb*. Warren
Banner:
/Few will question the purchase of most
durable goods on the Installment plan.
Homes are nsually bought this way. How-
ever, Most of us do not know what is hap-
pening not only in the calculations for the
costs above- the stated price (insurance,
;taxes, utilities, etc.), but to a greater extent
are thrown into confusion about the charges
at closing time.
Various reports show that installment
credit costs up to 42 percent per year, al-
lowed under State law. Usually stated rates
of 5 or 6 percent amount to twice as much
where the interest rate is constant even
though the outstanding balance is decreas-
ing with each payment. This may sound
confusing to some but it is easily under-
Stood if review is made of the tables pre-
pared by those who have calculated the ac-
tual cost to the consumers Of installment
buying.
I have always felt that the best deal for
all of us of small Means is to deposit our
funds in a savings bank, where interest is
paid each quarter, and make purchases from
Our cash.
Until there is some assurance that you will
not fall prey to the small print of a con-
tract, deal with reputable concerns and
there will be less chance that you will be
taken advantage of. Buy only what you need
and know you can and will pay for it. While
lending institutions are anxious to hp,ve their
money work, you should be just as anxious
to have them use some of your money with
interest.
, From the remarks of Prof. Per5ia
Campbell: ,
Consumer credit is an advance of pur-
chasing power obtained at a price; it is a
commitment of debt on terms. Over the
decade the percentage rate of increase for
consumer credit (about 110 percent) was al-
most twice,that of disposable income (about
60 percent); from about 13 percent of die-
posable income, consumer credit has in-
creased to about 17 percent.
Except in particular categories, notably
monthly Charge accounts, credit is paid for
by the borrowers at an estimated average
rate of from 14 to 15 percent per year; the
strange thing is that the borrowers, now
constituting well over half the American
families, rarely know what they are paying
for it. This strange phenomenon of blind
buying has different causes; a significant
cause is the fact that credit charges are
stated in different ways according to the type
and source of credit.
911F489/61g01.tffal9P-6-61AMINRIPb200140030-0
At hearings on the Douglas truth-in-
lending bill, Mr. McChesney Martin, Chair-
man of the Federal Reserve Board, admitted
that he himself could not make out the com-
parative cost of different types of credit un-
der these circumstances, which may all be
legal, under the hodge-podge of different
laws applying separately to small loan com-
panies, banks, credit unions, pawnshops, and
to retail installment sales and revolving cred-
it plans. It was to help the consumer exer-
cise informed choice in the credit market
that Senator DOUGLAS and his associates in-
troduced the truth-in-lending bill which re-
quires, in brief, that all types of credit
charges be stated both in dollar cost (which
enables a quick comparison betwen cash and
time-sale prices) and also with the equiva-
lent annual interest rate (to facilitate com-
parative shopping between different types
and sources of credit). Since the vitality of
a competitive market, central to our eco-
nomic system, depends on informed choice,
the Douglas bill has been put under the
jurisdiction of a subcommittee of the Bank-
ing and Currency Committee; it provides for
administration by the Federal Trade Com-
mission as part of its fair-labeling program.
Summary of remarks of Mr. Louis J.
Asterita :
Banks have not engaged in the installment
loan business at high rates, but rather have
sought to extend consumer loans on an ethi-
cal basis and at reasonable rates. By follow-
ing the principle of lending to credit-worthy
risks for any useful purpose, banks make
direct loans to individuals to buy automo-
biles at lower rates than those generally as-
sociated with dealer-originated business.
Moreover, bankers discovered they could
- loan for business purposes on a term basis
by making installment loans to small busi-
ness and adopting the installment credit
method. Other loan areas that have been
developed include charge account financing,
revolving check credit, on-the-job bank serv-
ice, financing medical and dental expenses
and loans to improve or modernize your
home. However, the extension of this credit
following World War II, has focussed atten-
tion _upon practices involved in the exten-
sion of consumer credit. Consumer credit
has grown from 21,395 million in 1950 to 68
billion year-end 1963. Installment credit,
which is the credit under discussion today,
rose from 14.7 billion in 1950 to 53 billion
in 1963.
The afternoon panel on "Environ-
mental Health: Air, Food, Drugs" in-
cluded the following participants:
George P. Larrick, Commissioner, U.S.
Food and Drug Administration; Arthur
J. Benline, Commissioner of Air Pollu-
tion Control, New York City; Ethel L.
Ginsberg, Citizens Committee for Chil-
dren of New York City.
From the remarks of George P. Lar-
rick:
Our food and drug law helps to protect
the public health, and this of course has
great economic significance. But this law
has other benefits. It conserves the con-
sumer's purchasing power. It stimulates
technological progress. It fosters fair com-
petitive practices. It is an underlying factor
in our free competitive economy, by aiding
consumer choice in the marketplace based
on reliable product information.
Experience has shown that without laws
to protect the consumer many dishonest
practices would flourish. Vigorous and con-
tinuing control is needed to prevent such
practices as short-weight packaging, substi-
tution of cheaper ingredients, and the sale of
spoiled or contaminated products.
Most of this food was pure and wholesome,
safe to use, and honestly packaged. But if?
let us assume?there haat been shortage in
A24a3 4!
n
the net weight averaging only a qar ter o
an ounce per pound?it would have cost con-
sumers over a billion dollars a year.
Establishment of food standards helps to
protect consumer purchasing power and con-
sumer health. The food standard regulations
prevent adulteration?for example by added
water. They require food to contain what
is expected.
Enrichment of selected foods with vitamins
and minerals is carried on through the food
standards program. This has helped to
reduce or wipe out diseases caused by dietary
deficiencies.
Under the law the Secretary of Health,
Education, and Welfare is required to estab-
lish a food standard whenever such action is
needed to "promote honesty and fair dealing
in the interest of consumers." Thus food
standards are also concerned with promoting
fair competition in the production and mar-
keting of foods.
There is no way to measure accurately the
cost of misbranding and misinformation in
the health field. It has been estimated at
more than a billion dollars a year. Vitamin
quackery and other food fads are said to
cost the public half a billion dollars a year.
But the cost would be far more were it not
for the protection of our Federal, State, and
local laws.
Here it would be appropriate to ask what
is the cost of the protection provided by the
FDA. In the current fiscal year the appro-
priation for enforcing the Federal Food, Drug,
and Cosmetic Act is $35,800,000, about
181/2 cents for each person in the United
States. We are sure that this insurance saves
the consumer many times its annual cost.
Commissioner Arthur J. Benline:
New York City's Commissioner of Air Pol-
lution Arthur J. Benline told the group that
smokestacks and chimneys, residential and
industrial incinerators, and car, bus, and
truck exhaust fumes are the basic sources of
air pollution in the city. More research is
needed in purifying auto Mihausts and in
smoke abatement devices.
Protecting health against air pollution de-
pends on preventing pollutants from enter-
ing the air. He explained that litter in the
streets up to your knees would not endanger
public health as much as the pollutants in
the air now do.
The afternoon panel on "Taxation and
the Consumer" included the following
participants: Prof. Emma C. Llewellyn,
Department of Economics, Sarah Law-
rence College; Peter Bernstein, author of
"Price of Prosperity" and "Primer ori
Government Spending"; J. A. Stockfisch,
Deputy Assistant Secretary, Treasury
Department. A summary follows:
Prof. Emma Llewellyn expressed her view
that the tax bill did not give adequate rec-
ognition for lower income individuals. She
took the position that at this time there
was a greater need to stimulate consumption
rather than investment. Professor Llewellyn
stated that the tax bill tended to place too
much emphasis on investment.
Peter Bernstein stated that, while he favors
a reduction in income taxes as a badly need-
ed stimulant to business expansion, he has
reservations on two levels.
First, we have made no real progress on
tax reform, he said. We are still allowing too
large a portion of high incomes to escape the
tax collector's net. Our income tax sched-
ules give an extraordinarily misleading im-
pression of the degree to which our tax struc-
ture is progressive: it accomplishes far less
in this regard than most people like to be-
lieve.
Second, he continued, the tax cut does lit-
tle or nothing to aid those people who need
help most?the families whose incomes are
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so small that they pay little or no income
tax in_any case. Indeed, he would far rather
that we begin to look at taxes, not as a bur-
den, but as a means of buying the things
we so badly need in terms of cleaner, health-
ier, safer, more comfortable, and better edu-
cated communities.
, Mr. Stockfisch explained the main features
of the tax bill as it was at that time before
the Senate Finance Committee. He ex-
plained what income classes would get a re-
duction and indicated that the bill would
have some elements of reform, although not
as much as had been hoped for in President
Kennedy's original proposal.
He also dealt with the question of whether
the Congress would accept the important
Treasury amendment on capital gains--to
maintain the existing tax rates on capital
gains. He pointed out the importance of
this amendment, and of eliminating the div-
idend credit provision which would mean a
lessening in the present tendency to tax
different types of incomes differently. This
in itself would be a very healthy step in the
right direction and a type of reform.
Mr. Stockfisch stated that he thought the
tax bill would make inroads in areas that had
never been touched before and that the bill
should be given more credit than its critics
are willing to admit.
Connecticut Development Commission
Supports Area Redevelopment
EXTENSION OF 'REMARKS
07
HON. WILLIAM L. ST. ONCE
07 coNNEcricov
IN THE HOUSE OF REPRESENTATIVES
Thursday, May 7, 1964
Mr. ST. ONGE. Mr. Speaker, I am
in receipt of a letter from the Connecti-
cut Development Commission, signed by
Its managing director Mr. LeRoy Jones,
In support of the administration's area
redevelopment program. In fact, in his
opening sentence Mr. Jones states that
the ARA program "has been of consider-
able help in assisting new industrial ven-
tures in Connecticut".
The letter also refers to a resolution
adopted last year by the Connecticut De-
velopment Commission recommending
an amendment to the Area Redevelop-
ment Act to "permit repayment of the
local loan in no shorter a period of time
and at no faster an amortization rate
than the Federal financial assistance is
being repaid". I would strongly urge
our colleagues of the House Banking
and Currency Committee, who have been
working on the bill H.R. 4996, the Area
Redevelopment Act Amendments, to give
earnest consideration to the amendment
proposed by the Connecticut Develop-
ment Commission. May I add that I
look forward to early action and passage
of legislation to continue the ARA pro-
gram, which is benefiting many areas
throughout the country.
Under leave to extend my remarks,
I wish to include the letter from the
Connecticut Development Commission
which reads as follows:
May 8, 1914.
Hon. WILLIAM L. Sr. ONCE,
Congressman From Connecticut.
Rouse Office Building, Washington, D.C.
DICAR Bum: The program of the Area Re-
development Administration has been of
considerable help in assisting new indus-
trial ventures in Connecticut. We are very
hopeful that Congress will continue the pro-
gram and are somewhat concerned that ac-
tion has not yet been taken on passage of
the Area Redevelopment Act. We realise,
of course, that many important pieces of leg-
islation have been held up.
Anticipating early action on this year's
area redevelopment bill, I would like to re-
mind you that our Commission is concerned
about one of the major amendment prepos-
ale which would make the program much
more useful in Connecticut. I refer to the
proposal on the amortization of the local
funds at the same rate of time as rumortiza-
tion of the Federal loan. In this oonnection,
I would like to repeat a resolution orignal-
ly passed by our Commission at Its official
meeting on April 17, 1963:
"Whereas there presently exist in the State
of Connecticut 3 redevelopment areas
designated under the Area Redevelopment
Act of 1961, comprising 16 municipalities, in
which expanding industries are eligible to
receive financial assistance from the Federal
Government; and
"Whereas such Federal financial assistance
is contingent upon local participation to the
extent of 10 percent of the cost of the proj-
ect; and
"Whereas the present requirement of the
Government that the Federal loan be fully
repaid before any repayments be made on
the local 10-percent loan; and
"Whereas this requirement freezes local
investment funds for up to 25 years, thus
possibly nullifying the locality's capabili-
ties to assist other projects for that time
period; and
"Whereas Congress is now considering an
amendment to the law to permit repayment
of the local share at the same time as the
repayment of the Federal share: Now, there-
fore, be it
Resolved. That the Connecticut Develop-
ment Commission urges Congress to enact
the amending section 6(b) (9) (B) of H.R.
4996 which would permit repayment of the
local loan in no shorter a period of time
and at no faster an amortization rate than
the Federal financial assistance is being re-
paid."
We will most appreciate any efforts you
can make in behalf of the passage of the
Area Redevelopment Act, including this
much needed change in the law. If there is
iiny additional information you would like in
regard to our feelings about this proposed
amendment, please contact me.
Very truly yours,
LeRoy JoNes,
Managing Directo
Administration Continues To Pile Error
Upon Error in South Vietnam
EXTENSION OF REMARKS
HON. BRUCE ALGER
Or TEXAS
IN THE HOUSE OF REPRESENTATIVES
Wednesday, May 13, 1964
AWER. Mr. Speaker, with each
passing day and with each contradictory
statement of administration spokesmen,
It is becoming increasingly clear that our
top leadership doesn't know how to win
the war in South Vietnam or how to get
out of it. Meantime, American boys are
dying there. Is it too much to ask that
at the very least a firm and definite pol-
icy be established?
May 13
The extent of the errors committed in
this tragic affair is outlined in the follow-
ing editorial from the Wall Street Jour-
nal for May 13,1964.
ERROR UPON' ERROR
Ten years almost to the day after the fall
of Dienbienphu, Secretary McNamara is in
Saigon?for the second time in the past
couple of months. Yet no matter how many
high officials visit Vietnam. or how frequent-
ly, nothing gets clarified. Except, that is, the
continuing failure of U.S. policy.
Though the conjunction of the Secretary's
trip with the anniversary of the French de-
feat is accidental, it could be unpleasantly,
symbolic. With a far greater force than the
United States has committed, the French
fought the Communists for some 8 grisly
years, and loat.
Vietnam was then divided north and
south, Korea-like, but unlike Korea the bor-
der Was fluid and not patrolled by large con-
tingents of United States or any other troops.
The Communists predictably made the most
of their opportunity, first as infiltrators and
guerrilla fighters; now they are so strong
they can and do attack in force.
Today the French wonder aloud how the
United States expects to win at the rate it
Is going. They are not the only ones; Araer-
ican servicemen and reporters have long been
saying we are losing the war. U.S. officials
are alternately reassuring and gloomy.
Part of the official attitude appears to be
that we are not supposed to win in a formal
sense: only help the South Vietnamese drive
the Communists out and keep them out.
But even this limited objective keeps going
glimmering. After all the U.S.-supported
lighting, the Communists are said to be in
effective control of sizable and important
parts of South Vietnam.
In view of that, it is almost impossible to
figure out what is the U.S. strategy, if any?
that is, how it thinks it can in fact drive the
Communists out and keep them out. Not
that anyone expects the Pentagon to reveal
its war plans in detail; it is rather that the
evidence indicates the lack of any plan
which promises to be workable against the
varied and successful tactics of the Com-
munists.
Not even the commitment of many more
American soldiers or the bombing of Commu-
nist bases in the north, which has been
talked of off and on, would be guaranteed to
accomplish the objective.
In other circumstances perhaps, but not
necessarily against this particular enemy, in
this particular terrain, with this particular
ally.
At the game time the French "solution"
of neutralizing all of Vietnam sounds like a
proposal in a vacuum, at least for the pres-
ent. Why should Ho Chi Minh the dictator
of the North, want to neutralize when he is
doing so well as it is. Of if he did want to,
we may be sure he would see it as a means
of continuing the conquest.
We do not rule out the possibility that the
United States may somehow some day turn
the tide, any more than we rule out the pos-
sibility that the realities of the situation
may finally dictate withdrawal. But what-
ever happens, the U.S. involvement in Viet-
nam reveals a series of classic military and
political errors from which it may be hoped
the Government will eventually profit.
First, the United States drifted into the
war, initially intending only to advise. It
evidently overestimated the fighting capac-
ity of the South Vietnamese troops while
underestimating the Communist Vietcong.
Second. the United States got into a war
where the enemy chiSe the field. The field,
moreover, is extremely disadvantageous for
us not only in terms of terrain but of dis-
tance from our shores.
Third. It got into a war without allies.
even though the interests of many nations
are effected. If its allies care at all, they are
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willing to let the Hnited States do it. fie
only ally: South Vietnam- itself, has never
given an Impressive demonstration of-a will
to win, on the part Of the people, the troops,
or the siaccestiye_znyerninenta._
To all this it may Well lie- objected that
. the arternatrve Was to 14-Sbuth. -Vietnam go
down_the Itkd Aran, and Perhafie-the -rest of
sOntheastr kkela With- it. The objection, we
think begs th?a1 issues:
ehead-courit-on military suc-
efen'Ifinfra;Thc tile most linfavoreIle
CirOurristalioes. NO Piece of :territory it be-
yond all Pride, Worth any cod, as the French
finally discovered 10 years ago after such
great- cost. " "And the United States, for all
its great power, cannot forever police the
world alone' Slid unaided. ,
Watershed Development in t
Ahead
re P.,ecaure
,raCrevsfoi4 4r* 1A1t
_
Olt WILBUR P. MILLS
xi4 DUE itOst OF r%i;lttg- tAtivE-
-1470inesday, May 13' 194'4 -
Mr MILtS Mr Spe,aker, it was my
privilege to- partieinate In the 11th
tiona.I Watershed Congress held recently-
in home State of Arkansas, at Little
nook.
' This Congress, Mr. Speaker, is spon-
sored by 17 of our leading national
ConServation,.and business_organ4ationS.
It does_riOtadOpt..rpAolWons,or_Priiiii.Ote
projects; It serves as alotirum fOr the -eic-
change of ideas and discussion o prob-
,
_ . _
lems.
Theme o theTe-oUpEees this year was
1.7.aterhe4 tiey0Topuierit 4:1.7:the 'clecra4e.
-
Because
they contain so 11:1441.
In-
ormatjon will beiiseI?l
?- Members of. the house, I should like to
Introduce in the RECORD the Watershed
Congress addresses of Secretary Of Agii-
? cjilture OrvMe L. Freemanandjtogis p,?
Deputy Administrator -for
? ,
V174,4,1'00?,, gf_Itm Po%1_ ,C0P.AquAt1gn?
The,940,e,sse$931P*;?
THE PRET io YgARS OF Pancsags tw'
ITATAOT'S. I.Ar4r-WAtEDs.
(Address by Hollis R. *Illiams,, Deputy Ad-
Ministratc4 for_ Watersheds, Soil Con-
, eerfation _Aervine, Department of
. ,Agriculture, at the 11th National Water-
pongress?Little A-06k; Ark., _April 27,
1260
oM,hougred,??0_,`partleipate in the 11th
NationatWatiers)40,.POPVess? '?,
4.0 13.Aye.&xlg_ht-td- Welcome you
?- Arkansas, to Little Rock, even though
that is not my charge. Por this is my home
State, and tlita is virtually my home city. I
was bOrii_nof sq Jar, Aproneo, Auck,r, own
farmpear ,My Wit plOce. 4.1.tho,ligh I have
spent _peilia,ps 1164 of My professional life
away !tem here;-it was My privilege -to head
the Soil p. owprvAior, 5.pryJ.0 gotivitjes in
this state 'for. more. than ,a depatle, from 1940
to 1957. This is keine, ..And it's sways good
to Come home.
Let me, then, ae.p, PAti7iTe:son,_,-itad'my voice
to the welcomo, you have already received.
VirUhortor,us,t1.- your Presence. And you
honor,ine by the privilege of this platform.
This is a distinguished forum, a forum of
national stat we and, prestige. Because many
ireat Ifrierteluis and inank-elci-qUent 'Spelt-es-
men have preceded me to this platform in the
10 years since first you met-, I approach with
great humility the task of being your key-
noter. This, r would have you know, is a
high point in my professional career. I beg
your indulgence.
My assignment is to discuss "The First 10
Years of Progress in DeveloPfng the Nation's
Watersheds.' 'This is a topic of such tre-
mendous scope that I'm sure you understand
I shall be able to hit only the highsPots.
Besides, I do wish to save a few Minutes to
comment, if I may, on the theme of this
Congress, "Watershed Development?The
Next Decade." For, as Oliver Wendell Holmes
said, "The great thing in this world is not
so much where we stand as in what direction,
we are'rrioting:"
And across,the front of 'me of our bea,u7"
tUul buildings in Washington?the National
Archives?these words art inscribed i'"What
is past is prologue."
I submit that the applicable moral of these
tjubtations is this: 'What has gonebefore
Is worth recounting and remembering not
for itself hut only for its contribution to
the fulfillment of _all our hopes and dreams
for developing the Nation's watersheds.
some historical perspective is important if
We are to understand our decade of progress.
Although the Department' of Agriculture
WAS created 102 years ago, it was not until
1936 that the qongress assigned to it some
responsibility in watershed work. The Flood
Control Act of 1938 authorized and directed
the Secretary of Agriculture to initiate a
program of "investigations of watersheds and
measures for runoff and waterfiow retarda-
tion and soil erosion prevention on water-
sheds."
Here, for the very first time, Agriculture
was given the upstream equivalent, in prin-
ciple at least, of the authorization of the
Corps of Engineers for "investigations and
improvements of rivers and harbors and
other waterways for flood control and allied
purposes."
For Agriculture this was a "survey, report,
and plan" period?not an "action" period.
And, it is important to record, plans for
upstream programs were essentially limited
to land treatment measures and minor
structures for land stabilization. This was
true even when operations programs were
authorized in 11 river basins comprising 31
million acres by the Flood Control Act of
1944.
When work was started in these basins in
1946, it became apparent, as had long been
suspected, that the measures authorized by
the survey reports would provide very limited
fipqd protection benefits. There was strong
and building desire for more positive flood
protection in the small _tributaries.
As a result, language was included in sub-
sequent Department of Agriculture appro-
priations to authorize funds for both land
treatment and complementary structural
pleasures necessary to aahieve desired levels
of flood prevention in the tributary water-
Sheds.
That is how floodwater retarding dams
got into the picture in the 11 flood pre-
vention watersheds. And it was a time for
bell ringing, that day in 1948, when the very
first upstream floodwater retarding dam was
completed to supplement a land treatment
progrton for flood prevention. This hap-
pened in the Cloud Creek tributary of the
Washita Basin in Oklahoma.
Many of you were active participants in
significant events from this point on. The
broadened concept of land treatment com-
bined with dams in the upstream watersheds
received immediate and strong public sup-
port.
By 1950 more than 300 watershed associa-
tions and similar groups were seeking help
in developing watershed projects for flood
prevention and allied purposes.
The hist' hill to-ProViele new tgislatIoii
was introduced by Congressman Bob Poage
of Texas in 1952. Pending legislative action,
the House Subcommittee on Agricultural
Appropriations-included $5 million in the
Department of A-griculture Appropriation Act
for fiscal year 1954 to start a widespread
pilot watershed demonstration patterned
after the work being done in the subwater-
sheds or the 11 river basins authorized in
1944.
Legislation to implement the small water-
shed program permanently was in the mak-
ing when your National Watershed Congress
met for the first time on May 21, 1954. You
and the organizations you represent had
created this climate. And your efforts, with
the help of others, quickly culminated in
tientof the Watershed Protection and
,71,99t1.17.rsyen n Act, Public raw 366, jus
-fei7i- inorillit-rater that year?in August
1154.
Thus, 10 years ago the Watershed Protec-
tion and Flood Prevention Act launched a
hoieful experiment in Federal-State-local
teamirork' for communitywide resource con-
servation and development
You as proponents of the program -felt
strongly that this kind of locally operated
watershed program could be a key that would
urirock all manner of community develop-
ment opportunities.
You envisioned water as the common de-
nominator that would bring rural and urban
interests together around local conference
tablet. Beginning with the obvious mutual
problem of flood prevention, such groups
gained the experience of cooperation that
enabled them to move toward solution of
other problems such as supplies of ivater for
municipal -and industrial as well as for agri-
cultural use. You saw also the opportunity
to develop water for recreational and fish and
wildlife developments and for a variety of
other purposes meaningful in the orderly,
desirable development of community re-
sources.
This was the hoped-for goal for the water-
shed program at its beginning a decade ago.
r-believe the program has measured up to
the hopes and dreams of its proponents.
It has demonstrated its effectiveness as a
tool in flood prevention, sediment reduction,
erosion control, and water management. ,
It has helped to accelerate land treatment
and has, in addition, achieved an important
beginning in shifting out of crops land ill
It hasdein-end-rated its validity as a work-
able mechanism of Federal-State-local part-
nership in resource conservation and devel-
opment.
It has proved an effective means by which
diverse community interests can work to-
gether toward common goals.
-Haw well demonstrated these values
can, in fact, be measured.
The program's popularity among local
communities is evident in the large and
growing backlog of applications for help.
Its acceptance as a valid and purposeful
mechanism for Federal-State-local coopera-
tion is seen in the enactment of a large
number of pieces of legislation to enable
local people to better participate in the
program.
Its merit as a means toward multipurpose
development of soil and water resources is
shown by the fact that more than 40 percent
of the approved watershed projects now com-
bine. watershed protection and flood preven-
tion with other purposes such as recreation,
fish and wildlife development, irrigation,
drainage, and municipal water supply.
Its practical value to the States is further
evidenced by the growing willingness and in-
terest of the State governments to make sub-
stantial financial contributions to the plan-
ning process. Contributions of 25 States
totaled more than $2 million in fiscal year
1964.
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Part of our decade of progress can be
traced to improvements in the original Pub-
lic Law 566 act. These improvements repre-
sent an evolution of purpose that calls for
brief review if we are to understand why we
are where we are, and where we may be
headed.
The first amendment to Public Law 566.
embodied in Public Law 1018 enacted in
1956, was an enlightened major step for it
recognized that watershed projects, like river
basin developments, should be comprehen-
sive in scope and have multiple purposes.
This amendment made it possible for proj-
ects to include works of improvement for
any beneficial use physically feasible and
economically justified. It removed the pro-
hibition against the Department of Agri-
culture sharing in the cost of water storage
for purposes other than flood prevention. It
authorized dams with a total capacity of
25,000 acre-feet providing that all capacity
above 5,000 acre-feet be for purposes other
than floodwater detention.
The amendment recognized that more
than agriculture is involved in watershed
projects by providing that the Public Works
Committees of Congress should approve plans
that included dams having more than 4,000
acre-feet of total capacity. It directed the
Secretary of Agriculture to allocate costs
and to use direct identifiable benefits as a
basis for cost-sharing for agricultural water
management.
Finally, this first major amendment of
1950 recognized the need for credit by author-
izing long-term loans to local organizations
at a low interest rate for financing non-Fed-
eral costs.
The amendment of September 1958 (Pub-
lic Law 85-865) authorized Federal financial
assistance for fish and wildlife purposes.
Public Law 88-468, approved in May 1960,
extended the benefits of Public Law 588 to
the 11 flood prevention watersheds author-
ized under the Flood Control Act of 1944.
Public Law 87-170, approved in August
1961, broadened the definition of local orga-
niaations to include irrigation or reservoir
companies or associations of water users
not operated for profit. This made it pos-
sible to carry out with established frame-
work projects with Irrigation objectives.
That brings our legislative review to more
familiar ground?familiar because it is of
more recent vintage and therefore fresher in
our minds. The Food and Agriculture Act of
1962, Public Law 87-703, approved in Sep-
tember 1962, broadened the watershed act
in four important ways.
It added recreational development as a
purpose eligible for cost-sharing, including
water resource improvement, basic facilities
for water-based recreation and necessary
land for recreational use. It authorized the
Department of Agriculture to advance funds
to preserve sites. It revised the basis for
cost-sharing and made it possible for the
Secretary of Agriculture to establish rates
on a program rather than project basis and
to follow the prinaiples of assistance au-
thorized under other Federal programs.
Finally, the 1962 amendment extended the
benefits of the Water Supply Act of 1958 to
Public Law 566 so that capacity for future
industrial and municipal water supply can
be included in a project with repayment
and interest charges deferred up to 10 years.
That rather sums up the Federal legis-
lative evolution. It is a record we can be
proud of. We have little to complain of.
and much to be thankful for, when we con-
sider the legislative tools that we have
sought and have received.
During this period important legislative
action was going on in the States. Between
1955 through 1963, 43 State legislatures en-
acted laws to expedite cooperation between
State and local agencies and the Depart-
ment of Agriculture in watershed project
activities. In all, 285 laws were enacted in
the 43 States during this period.
Federal appropriations since 1955 have
shown a fairly steady rise even though they
have not fully met the demand. In fiscal
year 1955, the appropriation was $7.3 mil-
lion. In 1959 it was $25.5 million. In 1964
it was $83.6 million.
The number of applications for watershed
project assistance per year has maintained
a fairly steady rate but there have been
ups and downs in the watersheds author-
ized for planning and for operations,
especially in recent years.
In fiscal year 1959, 82 projects were au-
thorized for planning and 80 approved for
operations. In 1981. 93 were authorized for
planning and 48 for operations. In 1983.
121 were authorized for planning and 88 for
operations. Bo far this fiscal year, up to
April 1, 88 have been authorized for plan-
ning and 74 for operations.
The number of States appropriating funds
for watershed planning Increased from 9 in
fiscal year 1959 to 25 this year. At the
same time, the amount of non-Federal funds
provided by local organisations and State
governments for project planning quad-
rupled. This year, local and State contri-
butions will amount to more than 02.3
million.
Nearly half of the watershed projects ap-
proved for operations thus far are in coun-
ties known to have unemployment prob-
lems and have been so designated by the
Department of Commerce or Labor. Proj-
ect construction work in such counties, of
course, provides local employment aside
from the increased employment that may
result from industrial, recreational, or other
products of watershed development.
A large number-233 of the 547 projects
approved for operations as of April I?are
multiple-purpose projects, which serve com-
munity needs best of all. The projects
combine flood prevention with one or more
of the following purposes: agricultural water
management, recreation, fish and wildlife,
and municipal water supply.
There is increasing interest in the recrea-
tion potential of watershed projects, espe-
cially since the 1982 amendment authorizing
cost sharing for this purpose.
We have given preliminary approval for
88 recreational developments In 82 projects
located in 29 States. These developments
involve cost sharing for added reservoir
capacity, land, easements and rights-of-way.
and basic facilities. The estimated total
cost of recreational developments in the 68
projects amounts to more than $30 million,
of which $16 million would come from State
and local funds. About 4 million annual
user-days are anticipated.
An analysis of the first 500 projects ap-
proved for operations shows they involve a
total estimated cost of $743 million, of which
approximately $441 million will be Federal
costs and $301 million non-Federal. Of the
$301 million non-Federal costs, about $197
million will be the costs of applying land
treatment measures and the remaining $104
million will be costs for land, easements, and
rights-of-way, administering contracts, and
other requirements of local organizations.
We have made important advances during
our decade of progress in developing the Na-
tion's watersheds. Indeed, in some respects
our progress has been remarkable. But the
job ahead is a tremendous one. Indeed, we
have barely made a good beginning.
The best estimate we have is thet there
are 1 billion acres of land and water that
need and are suitable for development as
watershed projects.
Local organizations through their applica-
tions for assistance indicate that they have
recognized this need on less than 15 percent
of this vast billion-acre chunk of America.
We have authorized planning assistance
for less than 7 percent of this area. We have
approved plans for and work has been
started on about 3 percent of this job.
Measured only against the size of the job
ahead, our decade of progress loses much of
Its stature. But measured by the difficulties
of implementing a great new national pro-
gram, what we have accomplished in 10
years stands out tall and strong as one of
the great achievements in American history.
But the size of the job ahead does indicate
that the job has lost none of its urgency.
Indeed, the fact that it is 10 years later in-
tensifies the urgency of the job. It is im-
perative that we speed up our rate of
progress.
An essential ingredient is wider public
awareness of the value of small watershed
projects in the economic development of
communities across the land?many of which
are doomed to a slow but sure decline and
death unless they find a way out of the
morass into which they are sinking.
Ten years ago we had to talk of the ad-
vantages of watershed projects in terms of
ideas arid opinions, based on limited experi-
ences. Today we don't need to rely on opin-
ions or guess. We have facts. The program
has demonstrated its worth. It has proved
itaelf. We don't think we know what a proj-
ect will do for a community. We know.
Based on solid experience we can say that
the 606 projects we expect to be operating in
fiscal year 1965 will help some 1,800 commu-
nities develop their land and water resources
on about 36 million acres involving a popu-
lation of 4.1 million people. The protection
of 2.9 million acres of flood plain will pay
returns estimated at $39 million annually
and bring one or more new industries to
some 150 communities.
Such a statement, it dinned into every ear
from every housetop and courthouse and city
hail in the land should be enough to gain
the attention of every thoughtful citizen.
Maybe we haven't been dinning enough.
If we haven't, let's get going. For surely
only through an informed public can we
bring to bear all the forces required to stimu-
late adequate action and, support at local,
State, and Federal levels.
I could give you hundreds of examples, of
watershed project benefits. Each of you
knows of several, I'm sure.
The benefits of every project outweigh its
costs. Each project is an investment that
returns annual dividends of 8 percent on
the average.
These are facts. We can document them.
Have the American people ever been offered
a-better bargain? I doubt it.
To take full advantage of this bargain, this
opportunity to Invest in the welfare and
prosperity of several thousand American
communities?and thereby in all of Amer-
ica?that is the challenge.
The challenge is bigger today than it was
10 years ago. For we have in motion a great
program that must maintain momentum.
We dare not let it slow down or stand still.
As Holmes said, "The great thing in this
world is not so much where we stand but in
What direction we are moving."
Shall we move forward? It's up to you.
ADDRESS BY SECRETARY OF AGRICULTURE ORVILLE
Le. FREEMAN AT 11TH NATIONAL WATERSHED
CONGRESS, ROTEL MARION, LITTLE ROCK,
ARK.. APRIL 28, 1964
I have looked forward to this opportunity
to join with you at your 11th National Water-
shed Congress, particularly because you are
giving emphasis this year to the problems
and prospects of watershed development in
the decade ahead.
I welcome the chance to look ahead with
you, for we have come to one of those rare
moments in history where both this Nation
and the world of nations seem to pause, to
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