House Ways and Means Committee; also, we can see that a copy of your testimony gets to the Congress. I am sure your conference will do that to the Senate Finance Committee, and to the respective Public Works Committees, and to the Labor and Education Committees. This is very important.

I might also respect fully suggest that the minority and majority leaders of both the House and Senate be included with a personal communication to you in your capacity as the president of the Conference of Mayors.

Mayor ALIOTO. Very good, Senator, we will do that.

Chairman HUMPHREY. It is necessary because decisions are being made at this very time, in the next few days, many of these programs as far as the Congress is concerned.

Mayor ALIOTO. That will be done within the next 24 hours. We are geared up to that. We are going to do it.

Chairman HUMPHREY. The mayor has to leave.

Do you have a question, Congressman Rousselot?

Representative ROUSSELOT. Mr. Chairman, I will be brief because I know our good mayor from San Francisco wants to get back.

I just wanted to comment that I did not hear the testimony. I'm sorry that I was not here because we are all interested in what the good mayor from San Francisco has to say.

Mr. Chairman, I assure you that although we are on different political sides of the fence, Mayor Alioto is considered a very effective mayor. I apologize I was not here. We had too many things going in the reorganization on the House side. We never know when a new chairman is going to be thrown out. So we are busy. I am sorry I was not here. I promise that I will review your oral statement and prepared statement carefully, and I know it will be carefully listened to by the committee, although I am a freshman member.

Mayor ALIOTO. I summarized the meetings of the Conference of Mayors. We have been meeting the last couple of days. We put together a program and we are submitting it to you for your consideration as a bipartisan issue. The Conference of Mayors executive committee is bipartisan. It is really a nonpolitical situation. We have good Democrats, good Republicans, and nonpartisans like myself. We have given you a unified program.

Chairman HUMPHREY. Let me ask you one question that we ask every witness as they conclude their testimony.

Do you see the antirecession program and the President's economic proposals contained in the State of the Union message as adequate, and will they do the job as you see it of halting recession and reducing unemployment?

Mayor ALIOTO. To the extent that we have indicated they should be supplemented by the specific points that we made. Insofar as they do not include these points, we do not think it will do the job for the cities.

We do come back to another point. We believe that the emergency is so serious that there ought to be very, very quickly a unified war plan, an economic-this is an economic war with serious consequences. There should be a unified war plan on the part of Congress and the

administration. It should be pursued as a strategy that we all agree

upon.

Chairman HUMPHREY. I surely agree to that approach to it, and I am pleased to have your views.

You are excused, and we thank you.

Representative ROUSSELOT. May I ask one quick question? Maybe you do not want to take time to do it now.

Many of the cities that have their own municipal plants in California have written us and said that they would appreciate it, those that are kind of in the oil business, if they could allow crude oil to go to its natural market price because there are various problems that they have.

Do you know enough about that to comment on it?

Mayor ALIOTO. You may not like my comments about it, Congressman. I will be delighted to make them. There is no such thing as a natural price, domestic price as long as you have a buyer's cartel operating in the Mideast. The Shah did not form that cartel. It was formed by five American companies, a Dutch company and a British company. It was based on limiting production to stabilize oil prices.

The effects of that cartel exist so strongly throughout the world that they affect domestic prices as well. So it is an anomaly to talk about the existence of a natural market price now. There is no such thing, nor can it exist until the full effects of that monopoly pricing and monopoly supply in the Middle East, until those effects are fully dissipated, no way you can get it.

Therefore, I firmly do not believe in the so-called philosophy of this natural pricing until those effects are fully dissipated. There is no way of doing it in the next 2 or 3

years.

Representative ROUSSELOT. I appreciate the gentleman's remarks. Chairman HUMPHREY. I thank you so much.

Mayor ALIOTO. Thank you, Senator.

Chairman HUMPHREY. We now have as our next witness the mayor of Bridgeport, Conn., Mr. Panuzio, and we welcome you. We are pleased to have you here with us today. Please proceed.

STATEMENT OF HON. NICHOLAS PANUZIO, MAYOR OF BRIDGEPORT, CONN., ON BEHALF OF THE NATIONAL LEAGUE OF CITIES

Mayor PANUZIO. I am delighted to be here with Mayor Alioto, who was so articulate on the problems and concerns of the mayors. I want to speak on behalf of the 15,000 municipalities of the National League of Cities. Our problems are not very different from the U.S. Conference of Mayors.

Chairman HUMPHREY. May I interrupt? The National League of Cities includes all of the cities that are in the U.S. Conference of Mayors, plus the smaller municipalities.

Mayor PANUZIO. Some 15,000.

Chairman HUMPHREY. 15,000, yes.

Go ahead.

Mayor PANUZIO. We speak in pretty much a unified voice, while we are both here representing organizations, we want to make clear that

our statements and concerns are the same. I am submitting a prepared statement on behalf of the National League of Cities, including, interestingly enough, one or two quotes at the beginning that I am sure you will be familiar with, since you wrote them.

We think without question that the crisis now is perhaps the most difficult one we have ever seen. I also think that it is probably the best and most unique time to make some substantive changes in our approach to urban policies that we have. We do not have to go over the entire situation or the deterioration of the last 4 months. Mayor Alioto and I clearly made the statement in September-September 28 I guess it was—at a summit meeting, pointing out our concerns about energy and our concerns about public employment jobs.

The questions, frankly, back home are being raised even to a greater degree now. We are finding people who are having a difficult. time adjusting to this whole question of inflation and recession. One week they learn about all of the things that we see impounded. The next week they learn about recession and unemployment.

Let me talk to you about a survey we did of some 67 cities across this country. These 67 cities were asked to give some information on the effect of the inflation and the recession.

First of all, one of the things we found: there is no big surplus back home, though last year there was some intention on some people's part to show up that suddenly government back home, and local government in particular, had surpluses. That does not exist.

Second, in terms of inflation, the budget increases for this particular projected year were 11.3 percent, just in the cost of government. Chairman HUMPHREY. All the cities?

Mayor PANUZIo. Of the 67 cities. In terms for next year we are going to be looking at a 13.5-percent increase just in budgets. Salary increases alone are over 10 percent. We are finding in terms of fuel costs a 90-percent increase in the cost of fuel.

In my own city we had $1.4 million total budget last year. This year we have already expended for fuel $1.2 million for 6 months. You can see what kind of cost bracket we are talking about.

All of the other things that are affected--the cost of operation, the cost of paper, the cost of food in our hospitals-continue to go up.

In terms of the recession, we have the necessity on the part of a number of the communities-there is a chart in my prepared statement. that shows this postponement of capital improvements-frankly cutting back and affecting areas where we would create jobs. Layoffs of city employees. A number of cities have indicated that-incidentally we did not include it because it would just throw it so out of proportion, cities like New York, Boston, Detroit, and other communities who have had to lay off so many people. Short falls in revenues, in my own community, a substantial decrease of some $1 million to $2 million in just taking the revenue from our taxes.

In effect, what do the cities do? Frankly, we have very few places to go. We either increase taxes or we decrease services. It is not very difficult for us. I cannot go to the council or a legislative body and say increase my debt limit, that is not there. I am precluded by State law from even having a deficit. I cannot increase too many taxes because all we have is the property tax. We have gone up on golf

carts, dog licenses, and parking fees, and all the things from which we might get a few dollars. Frankly we do not have anywhere to go, except for the property tax.

We basically see that the policy in terms of the Federal Government, both the President and the Congress, and I cannot emphasize enough comments made by Joe Alioto concerning getting your package together. I am a Republican. He speaks as a Democrat. I think we both speak in unison in asking for a unified budget and not getting ourselves off into this split.

We see it basically going down three roads: One, tax relief, which we support and are pleased to see; and two, governmental relief programs, including public employment programs, individual relief programs, and unemployment compensation plans. We see all these things as good. We see it working at cross odds with what we are trying to do at the local level, or what we are forced to do at the local level. The locals increase taxes while the Federal Government puts taxes back into the system, and we take it out. No impact and no stimulation for the economy is going to take place because as you give tax decreases, we are going to increase. The Congress and the President may wear the white hats on this, and the guy back home may be the guy with the black cape. The fact remains that if you give us taxes back, we are going to take them. You are just not going to stimulate the economy.

The Federal Government says to increase public service programs. We find ourselves forced to essentially reduce public service programs. Local governments lay off public servants. We are laying off some people that will be 10 or 15 years employed. On the other hand, we are being forced or are told to please hire public servants in terms of new people under the public employment program.

We revert to a regressive property tax while the Federal Government talks about equalizing across the board.

What are our recommendations? We have several. Obviously, the nine that Mayor Alioto talked about are certainly ones that we would agree with. We feel very strongly about the increase in public service jobs. We also think it is important to get some flexibility in that. That means flexibility in terms of the salary ceilings. By now we are unable to hire certain types or spend money for equipment. All we can buy for these public servants, frankly, that we are putting on, are brooms and so on, and we think we ought to be doing more if it is going to be a meaningful program. It will take some planning and equipment. We think we should be able to see down the road something accomplished rather than having us just clean up streets, which I think are both degrading to the person and certainly does not help the urban communities.

We think there is a need for flexibility in terms of hiring people back who have been laid off. We point out, I have heard from the Department of Labor, and it just amazed me, the fact that supposedly local governments were not hiring people fast enough. In those 67 communities, 90 percent of all the communities have hired as much as 90 percent under their title II situation. In my city we have reached 100 percent of title II jobs. We have reached 150 percent of title VI jobs. We just found out really what we are talking about in dollars.

Do not believe that the local communities are not capable of hiring public service people. If public employment jobs are given to us, we will hire. We have no problem with that at all.

Chairman HUMPHREY. Could you turn around and announce that good and loud? I read about that in the paper.

Mayor PANUZIO. I hope we get that across loud and clear. People are coming away with the feeling that local government is not able to put people to work. As indicated by Mayor Alioto, in the terms of the number of people applying for jobs, it is unusual. We had some 200 jobs open. We had over 2,000 people applying: There is no problem for hiring. Cities are hiring.

I am sure we can hire more if we were given them. I think we also better be looking at a carryover program, because what I am concerned about is while we are in the short term, I believe this country will come out of it, down the road I do not want to see us with a situation in which we literally dump out at the end of a 1-year program without a good phasedown situation, all of these public employment jobs.

Chairman HUMPHREY. I am glad you are bringing this up. This has been very worrysome to me. If we continue the public service job program strictly on a year-to-year basis, when the year is over, bingo, you are out. First of all, you have destroyed your whole employment pattern as a municipality on the one hand. Second, you have broken the spirit, frankly, of the person who is on the job. There should be some kind of way that you can phase it down so it is not an abrupt turnoff, either to the community or to the individual.

Mayor PANUZIO. We would support, obviously, the emergency general purpose relief program. We happen to believe that there is a need from $5 billion to $6 billion. The administration has pointed out some $2 billion for energy alone. If we are going to make some of these programs with regard to the economy in terms of stimulation of work, local governments are going to have to have that money not to draw it out.

We reaffirm the situation with regard to the youth employment. Congress and the administration, everybody seems to recognize the unemployment crisis of adults, but not much attention is given to young people. It is interesting to note in the New York Times yesterday a story about 12 million jobs this summer needed.

Frankly, we really need 3.2 million jobs. What we have said is we effectively can employ in the cities the 1.2 million, but the 3.2 million is really what we need. In my own community some people say, well, you know, out of the CETA program, we set aside $300,000 in the CETA programs toward youth. Last year we spent $1.1 million. This year we are looking at a need of $1.6 million.

If we are ever going to employ young people during the summer, we are just going to have to have that additional, but your point about having it early and not having to figure out how we get the program to have all these jobs dumped in our lap during the last minute is essential.

Chairman HUMPHREY. I want to, Mr. Mayor, because of your position and the area in which you come, to really emphasize this before

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