enormous amount on that in the coming year, to have both the B-1 bomber and the cruise missile seems to be a duplication, but Mr. LYNN. I have a hunch you will be getting into that question very deeply when defense comes before you. Senator PROXMIRE. We will be. As I understand, the President cut roughly $28 billion in the budget and said that would be spread evenly. How much was taken out of defense? Mr. LYNN. $4 billion, directly and another $700 million in disposition of unnecessary strategic stockpiles. So, it is $4.7 billion, or $4 billion, depending on how you look at it. Senator PROXMIRE. How can this be, in view of the fact the defense budget was increased as much as it was, and the rest of the budget was decreased? Mr. LYNN. First of all, as I said, there was an increase. I gave you the reason for that increase. But, it was an increase from where we were going, in getting to the $423 billion. In other words, looking at our projections on what the growth path would be unless there were these reductions, there was $4 billion in savings. This has to be an estimated number, as are many other things. But, I could give you a detailed list of those. They are provided in the reconciliation Senator PROXMIRE. Does that mean the Department of Defense was asking for $112.7 billion plus? Mr. LYNN. I think it is wrong to say asking for, because many of these reductions were worked out jointly with them. I think you are aware of the budget process in defense. It is a matter that goes on all year long. We work side by side with them during the year. So, there is no exact one figure you can work from. But, these are savings from what would happen if you did business on an "as-is" basis in defense. And I can run through the list of some of the major items, if you care for me to. Senator PROXMIRE. Well, somewhere, I have it here. And I guess the total civilian personnel in the Defense Department-and I understood you to say that that had been reduced-but in the first place, the total personnel in the Defense Department is more than in all the Government agencies combined, leaving the Post Office aside. It is enormous. Mr. LYNN. I think that is right. Senator PROXMIRE. Now, between fiscal year 1975 and fiscal year 1976, that changed very little. It went from 1.078,000 to 1,058,000, and then it goes down a little bit in fiscal year 1977————— Mr. LYNN. Are you dealing with the total full-time, or permanent employees? Just so we are working from the same sheets Senator PROXMIRE. I am working from a sheet here labeled "Fiscal Years 1977, Department of Defense Budget: Defense Employment Outlook for the End of the Year in Thousands." Mr. LYNN. Yes, that should be the total. But you are above it. They aren't the same as the figures we have. Senator PROXMIRE. These are Pentagon figures. This is from the Pentagon. Mr. LYNN. Well, we will have to devise for the record some kind of reconciliation. I think you are including civil, aren't you, civil functions, as well as military functions, like Corps of Engineer functions? Senator PROXMIRE. I am including the Army, the Navy, the Air Force, the defense agencies. Mr. LYNN. But are you including nondefense functions, like Corps of Engineer projects for building canals and so on? Senator PROXMIRE. I am told no. It is from a news release from the Department of Defense. Mr. LYNN. I have a hunch Senator PROXMIRE. It is military only. Mr. LYNN. It is military only? Senator PROXMIRE. That is what I am told. Mr. LYNN. We will have to have a reconciliation. Senator PROXMIRE. Well, I see there is another rollcall vote. I am going to have to leave. Did you have any further comments? Representative BROWN of Michigan. No. Senator PROXMIRE. Unfortunately, Senator Humphrey couldn't stay. I want to thank you very much. All of us have properly praised your intelligence and ability. We appreciate it very much. I understand that maybe Senator Humphrey and Senator Kennedy will return. So, could you wait a few minutes? Mr. LYNN. Yes. [A brief recess was taken.] Senator KENNEDY [presiding]. The committee will come to order. I am sorry, Mr. Lynn, to have been absent during your formal presentation and during the exchanges which you have had with the other members of the committee. But I want to express my appreciation for your presence here, and your willingness to comment on some matters of importance. I couldn't fail to let this opportunity go by without raising with you an issue which I am very much concerned about, and I feel that the American people are going to become increasingly concerned about, and that is equipping our regulatory agencies in the health area with the kind of resources and manpower and mandates for adequate protection for the American public. We have seen, during the course of very extensive hearings on the Food and Drug Administration, that in spite of some administrative ifficulties and complexities, essential review and followup and overight by that agency in the area of drugs is not taking place. One of the matters that we have found in our own oversight of the drug area is that after the use of various drugs over a long period of time, the drugs are having a very significant and dramatic impact on the health of the American people. I can mention one drug as an example, premarin, which has been on the market since 1942. It passed the test at that time. But there was no follow-up by the company or industry-and there is nothing that compels them to do so. The FDA doesn't have the resources for an ongoing and continuing review. Yet, recent data in the New England Journal of Medicine show a direct relation between that drug and cancer of the uterus and cancer of the breast. And similarly, during other very important testimony we heard last week, the use of some birth control pills caused increased heart problems, increased lung problems, liver problems, hypertension, and so forth, which are dangerous in and of themselves. Now, the Food and Drug Administration has neither the congressional mandate, which is our responsibility, for this kind of oversight, nor the resources to protect the public in areas like this. Another area of concern is the artificial colorings and artificial food additives. We have had testimony from parents and from doctors about the relation between artificial food additives and hyperactivity of children. I think we are going to find that the various compounds being added to the American diet, which are being put onto the American table every single day, which are going into the American bloodstream-these substances may seem safe and efficacious and meet the requirements at the beginning, but I think we are going to find they have a profound and harmful impact in terms of the health of the American people. The only way we are going to protect the public is if the FDA has the resources and congressional mandate to do the job. At this particular time, and we have spent a lot of time investigating the problem, we must conclude the agency does not have it. Also, Congress is about to give the Food and Drug Administration authority over medical devices. We have passed the legislation in the Senate. It is going to pass in the House. The administration supports it. The bill will provide a whole new area of jurisdiction for the Food and Drug Administration to review. As you know, it is generally assumed by the American people that when a medical device is implanted in the body, either the FDA or someone else has reviewed it and looked at it and found that it was safe and efficacious. That is not the case at the present time. Thousands of American women have actually died because of the use of IUD's. A number of individuals had serious complications with the Dalkon shield, which was one of the most widely used IUD's in America, but we were able to get something done on that. The medical device legislation will reinforce these efforts. It is going to pass the House, I would think, in the next few weeks. We are also working on a new Food and Cosmetic Act, which will provide additional responsibilities to FDA in the area of cosmetics, food processes, and food labeling, to insure adequate new protections for the consumer. That is going to be enormously important as an area of responsibility. We can look back over recent times and see the botulism problem and other kinds of health questions, which hopefully we will be able to remedy. Now, I personally don't believe that at the present time the Food and Drug Administration has the resources or the manpower or the scientific expertise to protect the American public. Dr. Rousher, the head of the National Cancer Institute, has criticized the submissions by many major drug companies-submissions of animal data and also on clinical data affecting human beings. We do not have the ability and the resources to set up the requirements or do the policing and inspections that are necessary to insure that scientific data are accurate and that the American public is being protected. That is not the only area that we are concerned about. The EPA, in terms of insecticides and pesticides, is running into a similar kind of problem. And this is based on direct testimony we had before our committee. There is an enormous potential for serious health problems because of the pollutants of the air, the water, and food. We must insure that we have protection. And the FDA is the only way to do this. Yet, their increased budget request was turned down by OMB. They got a modest increase of $3 million in this year, which isn't even enough to take care of the cost of living. Mr. LYNN. There is an 8.3 percent of an increase. Mr. O'NEILL. Those are budget authority numbers. Senator KENNEDY. My figures are from the HEW briefing we had. Mr. O'NEILL. Senator, the budget authority figures for fiscal year 1975, 1976, 1977 for salaries and expenses-that is leaving buildings and facilitates out of it-are $199.9 million, $207.8 million, and $223.1 million. Senator KENNEDY. Well, I am quoting from the figures that were given at a HEW health briefing. I would be glad to have that put in the record. It is a bare minimum, in any case. Mr. LYNN. But, Senator, that isn't really the point. That is beside the point. They have to have the resources to do the kinds of jobs that are required, and certainly whether it is the President of the United States speaking or whether it is Jim Lynn talking, of course they do. And to the extent this has a strong bearing on health-and your committee has been conscientious in looking at this-you will see complete cooperation from the administration. There is a strong feeling within HEW that on the preventive side of health, there are things that really have not been looked at before and there are some things that have to be looked at more carefully. This is undoubtedly one of them. It is another example of how technology and scientific development are the very things that make our lives better, but at the same time we have to take a hard look at it, to see that the adverse effects not outweigh the positive. I agree totally. The only thing I would ask, as we approach the budget for an agency, is that we do two things. One, let us not always assume that a requested number is the appropriate number. I was in departments and agencies for some 6 years-Commerce for 4 years, and at HUD for 2 years. And I have to say to you that even when you, as head of the department, conscientiously try to scrub the requests from below, you need help. I found that OMB helped me in that regard. So I would like to see us ask whether, instead of having everything just increase, there is somewhere else where the agency can do the job more efficiently. Look at that first. I don't knew whether there is. There might not be. But, that is a question that should be asked. The second thing I would ask-and I have no idea of the answer, well, I shouldn't say I have no idea, but I am not as expert as your people on the committee are-the second thing I would ask is what's the magnitude of the problem. Let's fit the remedy to the magnitude of the problem and got the right balance of responsibility as between what the private sector has to do, and under what kinds of penalties, as against what we do in the Federal Government. And that is just generally the approach I would like to follow. But, as far as identifying problems here and showing health risks, you will find complete cooperation from the administration. Chairman HUMPHREY [presiding]. Could I just put a few questions in the record here? There is a vote and if you want to follow up, you may. I mentioned to you earlier about the impact of the budget on State and local governments. I have some questions I want to place in the record. And we will see that you get a copy of these questions. and so will Mr. O'Neill. Mr. LYNN. Oh, I want to look at them personally. Chairman HUMPHREY. All right, sir. I also want to call to your attention that the staff of JEC prepared a list of possible budget savings and made estimates of the amounts which would be saved by 1981, if they were adopted. These were discussed in the December staff report of the current services budget, with which I am sure you are familiar. I would like to ask you to comment on each of those possible budget reduction measures as to which of them would have administration support andwhich would be included in the President's budget next year, Mr. Lynn, and our own estimates of potential savings, as to whether they are accurate. And if you could do that, we would like to have that information before we publish the transcript. And then on the current services budget, I do have some questions here that were related to the Congressional Budget Office, which prepared an updated comparison on the current services budget for a number of fiscal years. I was hopeful that we would be able to include in the budget a table dealing with Presidential recommendations dealing with current services budget estimates. We would like to have you to prepare for us a table, comparing the Presidential recommendations with current services estimates. Mr. LYNN. To do that on a full-scale basis, the way we did in December Chairman HUMPHREY. I mean for prospective Mr. LYNN. No, I understand, but what I am saying is we will have to get together with your staff on the degree of detail. I forget how many thousands of hours it took to do the current services budget, but it did take a long time. Chairman HUMPHREY. Well, we don't want to have unnecessary time spent. Mr. LYNN. But, I trust we can come to agreement as to the kinds of things you need in this regard. Chairman HUMPHREY. There is an article, Mr. Lynn, that was published recently by Mr. Palmer and this appeared in the Washington Post. Without objection, I will place the article in the record at this point. [The article follows:] [From the Washington Post] GOVERNMENT GROWTH IN PERSPECTIVE (By John L. Palmer 1) It now appears that the size and growth of government is going to be a major issue in elections at all levels in 1976. This is a debate that should be welcomed. But if it is to be constructive, it must be well grounded in fact, and much of the discussion to date appears to reflect some basic misunderstandings about the rate of growth of federal expenditures over the past two decades and the likely contribution of income security programs to their continued expansion. It is well known that federal expenditures, led by the near explosion in income security program outlays, have grown rapidly over the past two decades even after making allowances for inflation. What is less well known is that this growth did not serve to increase the size of the public sector of the 1 The writer, who until last fall was director of HEW's Office of Income Security Poliey, is a senior fellow at Brookings Institution. |