TRANSFERS TO OTHER DEPARTMENTS

Mr. LENNARTSON. I assume the transfers you want me to discuss are the ones to the Department of the Interior, which are mandatory. Mr. WHITTEN. Yes; and other departments and agencies.

Mr. LENNARTSON. We are providing for the usual transfers to the Department of Interior and to the Foreign Agricultural Service. The amounts on those are $5,200,000 to the Department of Interior under the proposed 1965 budget, and $3,117,000 to the Foreign Agricultural Service.

The transfer to the Department of Interior is required each year by legislation. The amount is based on 30 percent of the customs receipts on fishery products.

Mr. WHITTEN. So since that is required by law, really you have no control over it?

Mr. LENNARTSON. That is correct, sir. The usual transfer to the Foreign Agricultural Service is to permit them to carry on their market development activities which are quite closely associated with the types of commodities for which section 32 has been provided, in terms of surplus removal activities.

Mr. WHITTEN. Is that on the recommendation of the Department and approved by the Congress each year?

Mr. LENNARTSON. That is correct, sir.

Incidentally, beginning with the 1964 budget, each of the items financed with section 32 funds other than the commodity program expenses authorized in the basic law and related operating expenses must be specified and approved by the appropriations committee or in other laws. We are also providing again this year for the $45 million transfer to section 6 of the School Lunch Act, which is consistent with the original desires of this committee, and as we have done for I think about the past 4 or 5 years. We propose to use $167 million for the usual surplus removal, export and diversion payment programs. This compares to an average of $125 million which was actually used for these types of programs in the past 3 years.

It is our judgment in view of prospective economic conditions that this will be adequate to respond to the requests we anticipate may develop in the fiscal year 1965.

There is also provision for using $51,125,000 to carry on for another year the pilot food stamp program. This reflects an increase of $6.5 million over the limitation authorized in the appropriation bill for fiscal year 1964. This additional money will enable us to provide some increases in the already designated food stamp areas and to direct some attention to the more distressed economic areas in the event additional expansion is possible beyond those areas which have already been designated.

At this point, Mr. Chairman, you may want to discuss the food stamp program, or I can finish my notes here.

Mr. WHITTEN. Let's go into the section 32 a little bit further at this point.

Now you estimate that approximately $167 million will be used for diversion payments. By that, you mean your activities of the section? Mr. LENNARTSON. That is correct.

BEEF IMPORTS

Mr. WHITTEN. Now, this table was prepared prior to the Secretary's announcement about buying beef and beef products. I have been trying to point out in recent weeks that our Government is furnishing the know-how and the money to Americans, in certain cases, to go abroad and produce beef cattle and then bring them back into this country without limit.

The Secretary comes in trying to offset the effect on the marketplace by buying up beef. He announced he had worked out some agreements with Australia and New Zealand, which had greatly increased exports from their country into this country. I haven't yet read what concessions we made in order to get them in turn to enter into these agreements. I had lunch today with a fellow and we were discussing several Americans who have gone into Australia, on a rather big scale, to produce beef for the American market. In fact, one of them is one of the biggest American producers. I know of several others myself.

If you are going to buy up all of the beef that our Government is helping to produce in these foreign countries, how much are you going to have to add to that figure of $167 million? Has the Secretary counseled with you as to whether this figure should be changed? Have you gotten any indication as to how much of this U.S.beef grown abroad he is going to buy?

Mr. LENNARTSON. The surplus removal program recently announced-was announced on the basis that domestic producers are confronted with a supply and demand situation currently resulting in part from imports, resulting in part from a very substantial level of production in this country. They are confronted with this situation now, regardless of what causes the situation. It is here now and this is a sincere attempt to remove a certain percentage or a certain portion of that product from the normal channels of trade and channel it into the school lunch program and to the needy people.

Mr. WHITTEN. Mr. Mehren is here as the representative of the Secretary's office. I will direct my question to you, but if we get into the policy fields, I would expect him to handle that end of it.

I would like the record to show the amount of beef, livestock, meat, and meat products, that have been brought into this country in the last, say, 10 years, and the country from which we have received the meat or meat products, where they are significant.

Mr. MEIREN. This is just beef, Mr. Whitten?

Mr. WHITTEN. No, livestock, meat and meat products.

Mr. MEHREN. All right.

Mr. WHITTEN. I think the latest figures I got from the Department show it has practically doubled.

Mr. MEHREN. It was 11.2 percent of the total national supply in 1963.

Mr. WHITTEN. That is right. And that is a comfortable and easy way for you to say it. But I would say that is about a 400- or 500percent increase as against 5 or 6 years ago. You can describe these things from two angles.

Mr. MEHREN. I was in Iowa last week and I know how people feel about it.

Mr. WHITTEN. What I mean is 11.5 percent of the total supply sounds like it is not that bad. But when you realize that is probably a tremendous increase over what it was just a few years ago, then it becomes disturbing.

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