Nixon, Hardin & Moorer on Rural development and Revenue sharing

5:48This morning, we have a certain push to do something at all, particularly those who plan to save folks.
5:54But, you know, we've got all those various programs with regards to the president's care, and the staff, and the president's care.
6:06Thank you.
6:36A lot of people who live in what is called rural America, and that's more than 500 people.
6:44It's about 340,000 Americans.
6:45In fact, here in the state, less than 2 million people are being classified as farmers.
6:52It's a identification.
6:54Multiply that by 5 million, it's 7 million voters.
6:57Hey, wait a minute.
7:00They feel that not simply because of the reduction of farm prices, but because of the emphasis that not only this administration, but the previous administration, everybody in this city, problems in the ghetto, and so forth, nobody cares anymore about the farmers, and the farm, and rural America, and so forth, which has enormous problems.
7:28I need to say one thing about the poor education, poor housing, poor college.
7:33I didn't want that senator or senator to exist in rural America.
7:39Of course, it's in fact two-thirds of the counties in America in the last century has lost population.
7:48People are moving out of that part of the country.
7:53They're moving into cities and approximately half the people of this country by the next 18 years of living in the great metropolitan areas of Boston, Washington, Chicago, Pittsburgh, and San Francisco and San Diego.
8:08Whether that's good or not, it doesn't have to be seen like it is.
8:13But whatever the situation,
8:15There is, on that part of the country, there is a feeling of wealth, as the administration is saying, and that might be the weekend.
8:31But remember, this has been, in truth, our hard line.
8:56In fact, the amounts that are in this budget for what we call rural development are 30% more than last year.
9:07And we put a kicker in their direction.
9:12The problem is that after a long last there is some beginning to recognize that there is a special problem in this part of the country.
9:34That's really what this is all about.
9:35And I see folks like Bobby Griffin here, and Hugh Scott, and others who like to get themselves to be represented in urban America.
9:45I believe this is something we all need to listen about here in central Pennsylvania, rural America, and much more rural America.
9:56Most important, it's a very, very essential part of the country in terms of disparities.
10:02I don't like to see it destroyed.
10:05That's why we have set up the rural affairs council as one of the regions.
10:10It's on a very, very standpoint, but more important in the standpoint of what we do and pay attention to what happens in this part of the country.
10:21It's hard to make that presentation and ask you questions that people like.
10:27And I had a forum over around 9 o'clock to give an update to you.
10:32It's on the station, which I thought you'd like to have.
10:36And I give one every morning.
10:39I'm going to let you have it this morning so that you can notice it.
10:45It's a great job.
10:46I'm one of those folks that does a very good job.
10:52Thank you.
11:25Is that part of the question?
11:27Mr. President, I have one question.
11:29What was your reaction when you visited rural America at a good point at the end of the day?
11:34Well, very, very good.
11:36I guess the Iowa legislature also, and the governors, and the others, I...
11:51I feel that what is speaking more than anything else is just a lot of growth.
11:56We know they're there, and we care about them.
11:59It's just the attitude of all these things.
12:01The idea that we have programs and policies that we care about.
12:08As I said, there's a real bunch that does it to me.
12:14Whether it's the media, whether it's the episode, and so forth.
12:18All eyes are on the city now.
12:44We have done a lot, but the general reaction was great, great appreciation for the fact that you came.
12:52We have a program, and they said, well, it's about time.
12:56We're glad to hope you made it.
12:58Mr. President, we hope to come back to Rochester when the sun's shining.
13:03Yeah, but we figured that what we would do would be,
13:09We set that, perhaps, a lot of part of the goal.
13:14About a month away, the latter part of the team had now had to go after Easter, after Easter, because we were still going to have the meeting in Rochester.
13:27Having picked that before, we had it all set up.
14:30Yes, there are great people out there.
14:35I'm glad to give you the opportunity, President, because I went on from Des Moines to Kansas City and spent the day there.
14:46I came back to Washington and read the papers.
14:51And I couldn't believe that people who reported from the local papers had even been there.
14:56It didn't sound like the same meeting.
14:59And believe you me, there was great excitement out in Midwest as a result of the visit.
15:03I think it was a highly successful endeavor, and I just can't understand why some of the people from here were out there, but the rest of them didn't catch some of the spirit of it, rather than the little sideshow that they did report and give headlines.
15:18Would you spend a moment to tell them logistically what we did?
15:22You see, I first went out and spoke to the legislature, and to all the governors and presentenaries in the area, and those congressmen, and people like Kyle and others who were present, and also then opened the media briefing.
15:35That was my anticipation, about four hours.
15:39But in addition to that, I hope everybody else had a whole day to get out.
15:44It's not a day before, it's a very bad next day, and the next day as well.
15:48Very good, you mentioned it when we talked to the legislature, which always says a great deal about the next day, the next day and a half that I heard.
15:57But then, the meeting with the four governors, which was the second meeting of this group, Illinois, Wisconsin, Missouri, and Iowa, with their staffs, on the area of rural development, all of them, and these are states that are somewhat developed pretty well, encompass all the problems, urban and rural, because you have tremendous metropolitan centers in three of those states,
16:27So the governors were aware of the mayor big city problems as well as the rural problems.
16:32All of them have big rural areas.
16:35And the thing that impressed me with this meeting after following the one in Springfield in October was that we didn't have to be entirely preliminary, but we got right into the guts of the issues.
16:40And I thought we made great progress with this group.
16:41Then we went in and had 85 members of the agricultural press.
16:43These are the members of the farm magazines, Successful Farming and Farm Journal, and the state publications.
16:45The radio TV people, the leaders of...
17:06It was indeed.
17:41A chance to get a real feel for their views because they were quite candid and twidal when the entire atmosphere produced, well, encouraged them to ask the tough questions and gave us a chance to discuss them with equal candor.
17:56But I feel we'll get some good stories from this as the publications come out in the next weeks, and if you have a delay on that kind of reaction.
18:06But it just can't help but be good.
18:09Then I went on to Kansas City for a series of TV and radio appearances and talked to the Midwest Dairymen.
18:17Sands went on to the Twin Cities for a schedule of events.
18:25Morten went to Denver, and Romsfeld went to Memphis, and Romney came back here for a series of meetings, but he's got to get them all there, and in every place I think you should know that our cabin people go in.
18:43We have this program set up.
18:47in which they just don't go in and make any speech, you know.
18:52They do chicken dinner business, but they hit the media.
18:57They talk shows, they meet with the movers and shakers, and then of course with the special interest groups and so forth.
19:07In fact, I saw your schedule last year.
19:08A 16-hour day there in Kansas City.
19:11Yeah, I had a bit of fun.
19:15Now these are the types of things that you kind of get through, because if you can get several different groups, and all of the media, one after another, it seems to me it has more impact, because other people get some playback from a variety of sources all at once.
19:33But, looking at the whole area of rural development, this is a matter that you fellows,
19:42I don't like you, Mr. Ray, to speak to a problem here.
20:10There's been too, a lot of a tendency for, as I said earlier, to look upon rural Americans as being farmers, and then point out that the farm population goes down and down and down, the personal size of the American, which is to the great credit for the productivity of the farm population.
20:28It's the most productive part of the American.
20:32It's the greatest increase in productivity in all of America occurs not in chemicals,
20:39Not in automation, but in farming.
20:42So that's what inspires us.
20:44On the other hand, rural America is about 40% as we've been saying.
20:48We take a certain figure, you can get the figure of about 50,000, a town of 50,000 or less, or a county which has a density of population of 1 per 100,000.
21:07With the county of 2000, if the county of 2000 is in the county of 1 for 100, that will be classified rural America, because those people tend to identify their problems and treat it that way.
21:16Take for example the part, Margaret, the country that you come from, Norris County.
21:23New England is really rural America now, except for Boston.
21:30Maine, Vermont, Hampshire, much of that part of the country, you know, has its problems primarily more related to what you're talking about now, smaller towns rather than the big cities.
21:47You can have a Delaware, right, the middle of Pennsylvania, your farmers, of course, southern Illinois, of course.
21:57I think that we all have to realize that if you take California, Smitty, Central Valley, is now key to the election of anybody in California, right?
22:24And that's rural America.
22:29That's Fresno, Bakersfield.
22:33That's something you've never heard about.
22:36The point that I wanted to make for this background, these remarks, is that all the 20 odd years that this has been discussed,
22:51This is the first time that the President of the United States has articulated the problem and indicated that something should be done about it.
22:59And after maybe two years around the town, I have a permanent conviction that not a lot of things are important to ever get done unless the President himself endorses them.
23:07This is the first time that has happened.
23:10And I believe as we go around the country, this is a point that we can't make.
23:13President Nixon has spoken out strongly.
23:15He's gone into the country.
23:18He's talked about the problem of the farmers, he's talked about the problems of rural America, and they go together.
23:23They're part of the problem of rural America, totally.
23:26The stagnation that includes, as the president says, about 30 people, nearly half the poor people of the nation, those below the poverty line, over half of the substandard housing in the nation.
23:42Now, another thing that's important.
23:45Among the states that have lost population, or have failed to hold their natural increase, and there are a huge number of them over half the counties, there are growth centers that have grown as rapidly as the metropolitan centers.
24:02That's a trend we want to accentuate, to promote more growth centers, more small towns and small cities, becoming part of the modern growth of this country, as a part of the total program then of balanced growth of the nation.
24:19Income.
24:22Farm income, income of farm families, has closed with urban income a bit over the past ten years.
24:32But it's still running at a level close to three-fourths of urban income.
24:39It's also true of returns for capital invested and returns to labor.
24:43If we take then the next group, all rural families, and include those in towns of 250,000,
24:53We find that family income, totally, is now this past year 78% of global urban income.
25:03It was 55% ten years ago.
25:06Again, the gap is closing, but not enough.
25:12Again, then, let's accentuate the trend that is underway and make it move more rapidly.
25:25States are in much better shape to deal with this from their standpoint than they were any time in the past.
25:33The competence of staffs around the governor's offices are uneven, but at a much higher degree of competence and knowledge and ability to move than has been true before, and they're changing very rapidly because we do now have their interest.
25:52The programs that will have impact in rural America come from almost well over half the agencies and departments of the government.
26:00It's not just the Department of Agriculture program, although we perhaps have a higher percent of our programs that are involved than any other of the existing departments of government.
26:12Revenue sharing then, and I don't need to go into the philosophy of this, we've had that before, but the rural revenue package, one of the six in the special category, includes a group of programs that are underway, extension service, the Economic Development Administration in commerce, the ACPR program in agriculture, then a group of smaller ones, the Great Plains program, the grants for sewers and water systems,
26:42Pre-replanting, Forest Service, and things of this sort, grouped together with an additional amount of free money, charged $150-some-odd million, that goes with this package bringing into a total of $1.1 billion, that then will go to the states for their use in...
27:08for use in the areas defined in the proposed act that are the cities of less than 50,000 or counties with populations of less than...
27:27So that is the program.
27:32People have asked as we move around the country, when are you going to have a road development package?
27:40I think it is important to point out that it's really not a single program.
27:45It's a process.
27:46It's a process of the federal establishment responding to state and local initiatives, and particularly local community initiatives,
27:53Working with those communities that are willing to do those things that will permit them to move, and then perhaps the federal programs can come in and make the difference.
28:02And then with the revenue package, giving the states the flexibility, they may want to put more of their resources into some of the things that have been under the Intercultural Conservation Program, or they may wish to put less.
28:16They may wish to add more resources to the Extension Service,
28:20And they can't do this with the extra monies that are made available.
28:25There is some apprehension, and some of you may have heard it from the land grant college people, about putting the extension service in this package.
28:36I've had a great deal of mail, public, telephone calls.
28:40I think it's well to remember that this is a program that's been underway for a good many years.
28:45There has been a state matching requirement, matching the federal laws.
28:50In all the 50 states, the state, all of them, individually, have matched the federal funds and appropriated a great deal more money, state money, than is required by federal statute, as an indication that they're not about to abolish the extension service and do something else.
29:10I think this is a very important point.
29:14I can't believe that this will happen, because this is the basis for the campaign.
29:20There has been a concern among the county agents, the home agents, the 4-H agents, and others, that they're part of civil service retirement, and this would be cut off.
29:30The law that has been proposed protects all of these people's free benefit programs, including retirement.
29:37It permits this to be continued with payments being made from the states, from the revenue-sharing package.
29:44I really should try to think of a good place to stop her.
29:49And I think Mr. Harper and Mr. Price have the details on how the functions work.
29:55Yeah, would you like to take a look at this?
29:57Very fascinating charts sometimes are hard to understand.
30:02This will be the most complicated one you've ever seen.
30:07Okay, go ahead.
30:08Would you like to do the chart, John?
30:10Well, I don't want to say any words about the math and all the complicated charts.
30:14All right, John, you can start.
30:15Thank you.
30:16Go ahead.
30:19I remember the chart you put up in your mind with all those circles, and I just wanted you to be sure to show them what you think, and things that try to make us understand.
30:29Mr. President, Senator Smith, and gentlemen.
30:31The counties which are marked in red on this map are counties which during that 10-year period lost 10% of their population in World War I.
30:59while at the same time the other extreme, the counties in blue, are counties which picked up 14% of the war population.
31:07So what you see is really an emptying out of this part of the country to either coast and to the Great Lakes region.
31:16When we were briefing some of the Senate members of Agriculture and Public Works committees the other day, Senator Curtis, I think it was, on looking at the map, shook his head, and he said, you know, and I don't see a governor's micro persuasion anywhere from Canada to the Gulf of Mexico in that area either.
31:33But I am not one of those who is bored by the subject at all.
31:37I'm what the pioneer seat court people would call a hybrid, since I've spent my life in a mix between the New York metropolitan area and Iowa.
31:46And what I'm happy to see is the recognition now at Law Lab of the interrelationship between the problems of rural areas and the problems of urban areas.
31:58And the need, as Secretary Harden pointed out, for better balance in our patterns of growth.
32:03Now the reasons for the move are very obvious from what the Secretary pointed out on income figures.
32:11Very typically, the people who have left these counties, who have left the upper peninsula of Michigan, are people who are slightly better educated, who have slightly higher incomes than the average of the counties they live in.
32:24They are the opportunity seekers, and that's why they've gone to more urban areas, because that's frankly where the jobs have been, and that's where higher median incomes have been achievable.
32:35That's accounted for what's been happening.
32:38But at the same time, again as Secretary Hart has pointed out to you, looking at virtually any portion of the country which has suffered this attrition, you'll still see little marks of blue, namely points of growth, whether it's in Malaysia, or the upper Great Plains, or the mountain states.
32:57What this means is that in each stage there is some sort of hub of activity, or center of industry, or services, or perhaps it's a defense installation, or there's some reason why that has been a magnet for people leaving the more remote rural counties, but it's been able to hold them there, or to attract people from entirely other parts of the country.
33:23Now these are what we've taken to call growth centers.
33:27The Secretary pointed out that the tension or interest in rural development is not renewed, at least below the presidential level.
33:35But in the past, our efforts at the creation of job opportunities in rural America have, we came to feel, been misdirected.
33:46Typically, the programs like the Economic Development Administration, the Appalachian Commission, and the so-called Title Vs, Title V regional commissions,
33:57have isolated those counties which really were the worst off for attention.
34:04That is, they picked out usually the red counties.
34:07though not in this part of the country, interestingly enough.
34:11None of the federal programs which are mentioned qualify the upper Midwest for assistance, neither EDA, nor the Title V commissions, nor certainly Amalasia.
34:22So what you've had is federal attention maybe to the wrong sector of the rural problem.
34:29What's been happening with EDA is that it's been putting money into attempts to lure industry to counties
34:36where there really is nothing there.
34:38There's no tax base because the population left behind is aged and poor.
34:44There are few services.
34:46Doctors have not been attracted to the area.
34:49There are no community colleges in those counties.
34:52So that, in our opinion, in this Cabinet Committee on National Growth Policy and Rural Development, past federal efforts were not targeted on the right areas.
35:01We came to feel that a much more appropriate effort would be built around growth points or growth centers.
35:09The reason was that usually these centers not only have a growing population and jobs,
35:15But they also are a hub.
35:17They are a commuter center.
35:19People drive 35-50 miles each way each day to work in this kind of area.
35:26But frankly, we thought about and then dismissed the idea of targeting these resources only on growth centers that we thought we could identify.
35:37The reason was that having set up federal programs for rural development in the past, which we now feel are not targeted properly, we were wary of saying, let's lay down strict federal criteria about what areas are going to get aid.
35:52We didn't want to make the same mistake all over again, having constraints in federal law, which wound up not letting the states do what turned out to be best for rural development.
36:05So at the same time that the president was moving toward his decision on revenue sharing, this cabinet committee, headed by Secretary Hutch, was headed toward a block grant for revenue sharing approach to the states,
36:17for rural development purposes, and that's where we've wound up with the rural development grant that Ed Harper will describe here.
36:25What we are going to do is to exhort the states to plan in terms of using the trends that we see here as a way of holding people in the rural states, and perhaps in the long run, more importantly, attracting people who otherwise would settle in the most congested areas
36:46into the middle part of the country and the smaller cities wherever they occur in the country.
36:55So we will, as I say, exhort the states to build around this, but we will not in any way hobble them.
37:01They're probably a lot better than we are at deciding which areas have the potential to grow, and we would be very reluctant as federal government to get into that choice.
37:12So now, Ed Parker will describe to you, not alone the billion and one hundred billion revenue sharing for the world development, but the way in which all the other revenue sharing, some 16.2 billion dollars, will, in some way or another, be brought to bear on the problems that we're in right now.
37:28You pointed out, Mr. President, you pointed out what the red wasn't until it was utterly striking in 2019.
37:35There are varying degrees of one trend or the other.
37:40The shaded red is a county which has lost less than 10%, but it's still a lost population.
37:48The shaded blue is a county that gained less than 14%.
37:59President, I think you'll find my charts today a little less complex, because I think that a large part of the complexity of the charts I displayed in Des Moines was due to my penmanship, since the charts in Des Moines were freehand.
38:12This morning we've heard a lot about the concepts behind rural development at one point that has been stressed.
38:21The fact that rural development is not just one thing, it's a capital phrase that describes a number of different kinds of activities.
38:30Because there's not just one thing that rules it all.
38:33What it is, very often, is a strategy to build a base which attracts industry, that creates jobs.
38:40Essentially, the process that's involved is planning to take advantage
38:46of opportunities that develop in the private sector, because in the private sector is where the jobs are.
38:53This is one way of keeping a look at the different kinds of things that are involved in rural development.
38:58Of course, the most important point in any development strategy is people.
39:03That's the base you have, their educational background.
39:07They're specialized in training for industrial purposes.
39:11The health of that labor force is also critically important.
39:14And it's important that the disadvantaged in that population do not become a drug upon the labor force.
39:19It's important for them to take care of the disadvantaged, the elderly, the disabled.
39:24Whereas you have to link...
39:27from transportation, your labor force, to resources and to markets for their work.
39:35We also need to have the public sector infrastructure to support industry through water and sewer programs,
39:43which are indicated here.
39:44Of course, the environment is becoming more and more in consideration in industrial locations around the country.
39:51And finally, of course, there's the need for adequate housing, not only for the executives of any company, which might move into an area as well, for people in these areas.
40:02We are familiar with the fact that there is considerably more substandard housing in rural areas
40:09That there is in urban areas.
40:15And here, on this overlay, I'll take you to that.
40:19Yes.
40:19Yes.
40:31For example, when we're out there with governors and so forth, they often think, we've got seven agencies, where do we go?
40:34And particularly for the smaller towns and the smaller communities, we don't have a council or that sort of thing, we have the slightest ideas.
40:50How to get a grant.
40:51The congressman or the senator, or whatever the case might be, and then the congressman or the senator, because he always doesn't work well.
41:01Don't ask me.
41:03And you can probably give them... Well, there's only three, that'll help.
41:07The FHA, the Department of Tourism has traded with one.
41:12The High Basin Sewer and Water Program is another.
41:15The Urban Renewal provides the sewer program.
41:18The Naval Development Program has sewer authority in it.
41:22The Model Cities Program has sewer authority in it.
41:25And there are a couple of other programs.
41:27EDA has their authority, and Appalachia has their authority as well.
41:29They've had it in a couple of other areas.
41:31I think there's another one.
41:32I think there's another one.
41:33These are the different ones.
41:45The president is
41:56made proposals to Congress with respect to each of these areas.
42:00You find in education, the special revenue sharing program, in math power, another specialized revenue sharing program.
42:07Within the field of health, President's recent message has emphasized targeting health resources in scarce areas.
42:16One way that he's done this is to suggest a loan forgiveness proposal for young doctors during their education years in located areas that are scarce,
42:26In terms of doctors, parts of the cost of their education would be forgiven.
42:31Also, incentives for health management for organizations with new health services delivery mechanisms would be located in scarce areas.
42:39Also, health education centers would be located in areas that are short in supply for personnel.
42:46For the disadvantage here, the welfare program comes into play, and we expect about $2 billion of that would be targeted on rural areas, whereas formerly, if you lived in an urban area, then you had a good chance of getting whatever your fair share of the welfare program might be.
43:04In transportation, the president will shortly be sending to the Congress a new special revenue-sharing program there.
43:09His budget for fiscal 1972 proposes a 60% increase in the outlays for the rural sewer and water program.
43:14In the area of the environment, waste treatment outlays go up 100% for fiscal 1972.
43:19He has proposed environmental finance and authority, which in particular helps smaller towns finance their municipal waste treatment programs.
43:34And also, this year, the environmental message proposed a new land use planning grant program of $20 million a year for the next five years.
43:44And finally, in the area of housing, loans for low- and moderate-income families will go up 64%.
43:51Off the slide.
43:55So this is what the president has proposed aside from the special revenue sharing program for rural development.
44:03And it provides the kind of flexibility which will allow you to bring together all of the factors that we see here on the chart into a coordinated and effective strategy for development, for creating income opportunities, for bringing into rural areas, to cultural, educational,
44:22recreational and health opportunities that are going to make rural America a better place to live in.
44:29Now, as the Secretary briefly touched upon, a number of the present programs will be combined into the Rural Development Special Revenue Insurance Program.
44:39Here I've displayed them more or less by where they come from.
44:43You see, first of all, more or less the general categories of programs that are currently covering a broad spectrum of authorities in the rural development field.
44:55The new money, untied in Japan's history, is $179 million in new life authority.
45:00First full year.
45:01I apply regional commissions, Appalachia, the EDA, the Education and Extension Service, water and sewer, rural water and waste, and the environment and several programs there.
45:14One of the reasons I wanted to display the programs in this manner is to point out the kinds of flexibility that would be available in the use of the Rural Development Funds.
45:25All of the authorities you see represented in these programs would be authorized for the use of the Rural Development Special Revenue Sharing Funds.
45:36In addition, because we'll have a number of small communities in here, we will also ensure that the authority is available for programs like model city urban renewal, but also be available to our smaller cities and to rural areas in promoting what would be in their mind the most effective developmental strategy.
45:57Finally, just go on to one last chart, one that summarizes my part of the presentation.
46:00We're talking about $1.1 billion for the purpose of rural development.
46:02The purposes are briefly sketched out there.
46:03The benefits are 100% for rural areas, as we've defined them.
46:05Towns under 50,000, counties anywhere with populations of less than 100 per square mile.
46:27The distribution formula in this special revenue sharing program, as in all of the special revenue sharing programs, is problem-oriented.
46:35And you'll see here that we are, in this program, dealing with three indications of the problem.
46:41One of these is rural population.
46:44That here we compare the state's rural population with the rural population of the nation as a whole.
46:50That's been one of the factors determining individual states' share of the rural development funds.
46:56Secondly, it's rural out-of-migration.
46:58We call John Price's map with all the red counties on it.
47:03That gives a heavy out-of-migration.
47:06We have focused funds there for two reasons in that state.
47:09One, because if there's out-of-migration, there's either a problem there or there isn't a good reason to stay there.
47:15And so we ought to be focusing on the problems of the individuals there.
47:19Secondly, from a national perspective, in terms of the population trends, which the President pointed out earlier, and John Price pointed out earlier, there's good reason to make this kind of investment.
47:31And finally, we talk about per capita rural income, and we compare the per capita income of a particular state with the per capita rural income of the nation.
47:39And these are the three
47:46Rural population, rural out migration, or...
47:56or growth rates below the national average as well, and growth per capita income.
48:02In terms of federal restrictions on these funds, there would be no requirements for manning or maintenance record by the states.
48:10There would be no federal prior approval of plans or projects.
48:14The only process to not refer to these funds is no strings attached, because there would be two important strings.
48:18One of them is guaranteeing that the Civil Rights Protection Act would accompany our present categorical grant funds, would accompany these funds, and secondly, that there would be proper auditing provisions to make sure that funds for rural golf are used for proper public purposes.
48:26Thank you.
48:40I think it might be well to take a little look at the history.
48:57Back before the turn of the century, the Congress did establish federal funds for the agricultural experiment stations and made them available to the states for this purpose on a formula basis.
49:10Some money for all the states.
49:12This has been modified and increased through the years.
49:15This has been the bedrock under which this great increase in agricultural productivity has taken place in all the states.
49:23We have the very strong, professionally competent research programs in 50 states today.
49:32Now, the alternative to that would have been to have, in fact, in the time of World War I or any time since, to have concentrated these funds in what might have been called centers of actions.
49:43In that case, most of the funds would have gone to three or four states, New York State, Cornell, or Wisconsin, or a later date, California, and others.
49:57and we would not have had this broad development in agriculture that is unique in the world.
50:04Now we came along in World War II,
50:09And under the pressure of war, it followed a wise decision that our initiative and so forth was intended to invest in the centers of excellence.
50:14And this had a tremendous impact on economic development.
50:15And the patterns of population as the country had grown, even at that time, we had a bit more leisure.
50:29And the funds have been spread like the agricultural funds have been spread.
50:30It's my feeling that we would have had a more uniform balance growth across the nation, and the heartland in the south would be in better shape today.
50:34Now, back to the funds.
50:34I'm sure in the early days some of these funds were not used well.
50:47But through the years, they did develop competence, whether it was professional pride or institutional pride, state pride, or just getting on with the job.
50:50Competence did develop as the funds remained available.
50:52And I think we have to trust that the state people, that with these kinds of programs, likewise, as time goes along, they don't have it today, will develop the competence, they will respond to the problems, they will get the work done.
51:23Yes, John.
51:24Mr. President, Secretary Hardin has just addressed himself to the question of competence.
51:26It occurs to me that one other question may be raised, because in the general formula, or in the formula for general revenue sharing, we have included, as I recall it in the memorandum of action that's used to determine the state that each share gets, an element which reflects the tax effort of the state.
51:52Now, as I understand it, from the explanation I was given, we do not consider either tax effort or maintenance of existing tax effort in deciding on the allocation of these funds.
52:05How do we do that?
52:07We argue that we don't really thereby give the states the incentive to do what they should be doing, as well as the federal government.
52:16Ed, do you want to respond to that?
52:19Well, that...
52:21With respect to maintenance of effort first, one of the basic considerations of the revenue sharing approach is that the state and locality be able to determine their own priorities.
52:33To impose the maintenance of effort restrictions upon the state and locality takes away from them an important measure of determining their own priorities.
52:44With respect to the maintenance of tax effort, as has been pointed out in various forums, in some places perhaps the most appropriate use of additional funds, especially with general revenue sharing, perhaps in other places as well, might in fact be a reduction in taxes.
53:08It would just arbitrarily apply the principle of maintenance and tax admission.
53:16It would arbitrarily, in fact, just pour more money into the existing tax, rather than to allow flexibility in terms of what the tax is.
53:27That's our philosophy.
53:30Mr. President, last week,
53:56We had the committee of agriculture members down.
54:00There were several that came from the Appalachian area that indicated some concern and apprehension.
54:08In those particular instances, as I recall, Ed or...
54:14Somebody was going to take a look at some way of protecting some of their programs by state plans or regional plans.
54:24Was anything developed in that regard?
54:28The specific point was the highway.
54:32I explained the route here.
54:55that with respect to some of the special revenue insurance programs, we have an intrastate distribution formula.
55:02If I can just briefly refer to John Price's match, one of the problems with an intrastate distribution formula with respect to rural development is need to aggregate funds.
55:15If you just have a formula, let's say, for the state of North Dakota,
55:21That would arbitrarily distribute a certain amount of funds to each one of the counties.
55:26Each individual county would like to choose to decide to try to build an industrial park with its few dollars that it would get out of an intrastate distribution formula.
55:38When in fact, from really the perspective of all the people of the state of North Dakota, they'd be better off if they aggregated and concentrated
55:45The funds they got for rural development, as they perhaps in these more rapidly growing areas, in fact, an investment there might well benefit a number of the red counties surrounding the growth center at this particular time.
56:00That's why we are reticent to get involved in the intrastate distribution formula.
56:06If we don't have an interstate distribution formula, how do we ensure a fair distribution of the state?
56:11There, we were examining different processes by which a state plan would be prepared.
56:17Here, one of the chief concerns is accountability.
56:21If you use it too greatly within the state, then nobody knows it's responsible for the plan.
56:31In the eyes of some, the plan doesn't have a gigantic log-rolling operation, and then again wind up with the economy more or less disproved within the state on a practical basis, with no significant advance in rural development being accomplished.
56:47So the governor probably will have to play a key role.
56:52We are right now studying what alternatives we have with respect to involving state legislation more thoroughly in this,
56:59as well as ensuring some kind of consultation perhaps with cities and counties in rural areas.
57:06So the sessions last week with the National Republican members of the House and Senate were very valuable.
57:13We are following through on those.
57:14We haven't come to a final recommendation from the President on that yet.
57:22Hugh, would you like to give us a brief report as to where you all stand in the Senate?
57:29We're not your rules.
57:30Yes, you're not very much to say.
57:32We are voting on the report at 1 o'clock today on the fourth closure petition.
57:40Jack Miller has an amendment to it at this time, one which needs to serve the favor.
57:47And the church's suggestion of accepting it, the proposal is to retain the two-thirds of any changes to rules.
57:57Three-fifths, otherwise, if a majority of each party are recorded as favoring three-fifths, it could pick up anywhere from two to five votes, yet assuming possibly in the 57-59 area, it will not be sufficient.
58:13This may hold me down.
58:14Meanwhile, this may be the end of it.
58:17There is some talk of continuing.
58:20Meanwhile, we will tomorrow begin the discussion of the constitutional amendment, the 18-year-old vote, and other than federal elections.
58:31And we have little else except that I understand from that.
58:37Thank you for watching!
58:54Mr. President, may I ask you a question?
58:56I read in a paper this morning that at the hearing yesterday, Long indicated there may be some problem on this four and a quarter percent amendment.
59:07Is that just newspaper talk, or is that just...
59:12I don't know.
59:15I thought you had any questions.
59:18Four and a quarter percent amendment.
59:22Well, we...
59:44We have two bills up this week.
59:47Extension of the interest equalization measure, which I don't think is going to have any difficulty.
59:55There wasn't any problem in the rules committee.
59:58And then we have the extension recommended by the banking and currency committee on wage and price control authority and the credit control authority.
1:00:16There will be any opposition of significance there.
1:00:21They're hell-bent on getting this authority through, and I think they make capital out of it, but they didn't seem to on that point last fall, so in light of what the Secretary of the Treasury testifies for the Joint Economic Council,
1:00:41There was no objection to the extension of the story, you know, and the top of the question was repeated at this point, but both measures were voted without understanding.
1:00:56I would say this, Mr. President, that probably next, tomorrow, the week from Wednesday, we're going to take up the Department of Transportation appropriation bill, which is, of course, highlighted by the controversy over the SST subcommittee that imported it out of appropriations.
1:01:20There's a 72 vote that comes before the full committee Thursday of this week, and it will be on the floor next Wednesday, and it will probably be Wednesday in terms of the vote.
1:01:32With regard to the SSP, recognizing the differences there are on the side here, I want to reiterate.
1:02:14It's at least 150,000 jobs.
1:02:15That's probably, probably...
1:03:31Hei!
1:04:02If you were to poll people, you'd probably find about 70% of them against you.
1:04:07The reason is that we're not here to follow people when people don't know the facts, but we're here to lead the people.
1:04:14And sometimes people don't know the facts.
1:04:16It's just that we always follow the people, and I might say we never built the airplane in the first place.
1:04:21It was a matter of fact that we would have done it before we did it.
1:04:53It's a major breakthrough in terms of the inevitable, it's inevitable that people, whether it's the deal with government or it's your law, it's true.
1:05:05Let's understand there's some that have bought it through, considered all the fact that you're trying to respect them.
1:05:34I'll see how he does it in person.

Nixon, Hardin & Moorer on Rural development and Revenue sharing

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Also recorded on March 9, 1971

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