Mr. MATSUNAGA. Can the gentleman estimate what the necessary additional funds would be to make this program successful such as funds for registration, funds for training and retraining, and so forth?

Mr. ULLMAN. In my judgement, it would take just as big a package. We would have to take the $2 billion that we now are putting into cash supplemental payments for the working poor and put it into a meaningful childcare work training special project program to make this meaningful at all in the way of putting people to work.

Mr. MATSUNAGA. Unless those funds are provided, this would merely be a show without any substance, without anything in the show, itself?

Mr. ULLMAN. The only thing we can say about it is, if it is properly and fully implemented, it will just be an inch of progress maybe in the right direction of work training. But once you start down the cash road of giving cash payments, the pressure is going to be to expand that area so our budget is limited so we are going to go that way instead of training.

I think if you take the cash payment way ultimately, you are going to abandon the work training way and ultimately go the Freidman route. I may be misinterpreting him, but he argues in favor of negative income tax because it is a lot more economical and cheaper to just pay people money than it is to get them involved in rehabilitation and training and everything else.

This program tried to go both ways. It is being sold on the basis of a work training program when in fact it is the beginning of a guaranteed income. I think you are riding two horses going in the opposite direction and sooner or later you are going to have to get off of one and on the other. I would be much more in favor of getting on the horse of work training.

But, if you start down the kind of road we are on now, that is not the horse you are going to get on. You are going to get on the horse of guaranteed income. We don't have enough income and resources of this country to go both ways.

Mr. YOUNG. Did the U.S. Chamber of Commerce appear in opposition to this legislation? I understood they had written some letters. Did they appear before your committee?

Mr. ULLMAN. You would have to ask the staff that. I know they are strongly opposed to it now.

Mr. YOUNG. Did labor organizations appear?

Mr. ULLMAN. The labor organizations came. I don't think they are strongly in favor of it but technically, yes, they are in favor of it. Mr. YOUNG. How about the nuts and bolts people in these welfare programs throughout the States? Were they represented?

Mr. ULLMAN. We had the State welfare directors over and they have grave misgivings about it. You can understand in essence we are putting them out of business in a way.

Mr. YOUNG. They had some setup for funding?

Mr. ULLMAN. Yes. The testimony before our committee was overwhelming that the kinds of funding here is totally inadequate to the program?

Mr. YOUNG. That is all, Mr. Chairman, thank you.

Mr. DELANEY. Since you are on the committee, Mr. Gibbons, you are entitled to testify.

STATEMENT OF HON. SAM GIBBONS, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF FLORIDA

Mr. GIBBONS. Mr. Chairman and members of the committee, I want to call your attention to a number of things that affect this program and affect what we do in Congress and ask you to grant a modified open rule to make it possible to present one amendment, and only one amendment.

An amendment which I think makes good sense and an amendment which in the long run will save the U.S. Government about $270 million.

Other witnesses have talked about the food stamp program but nobody has really talked in detail about the food stamp program and its interrelationship with this program.

First, let me say that the food stamp program serves the same constituency that the family assistance program serves. In fact, it serves a slightly larger constituency. There are approximately 23 million people who are touched by the bill you are considering today.

The food stamp program would touch the same people. I want to talk about how the buck-passing between the two committees, the Agricultural Committee and the Ways and Means Committee ought to stop and the only way it can stop is right here in this committee.

It is your responsibility to recognize this as a problem. It is your responsibility to do something about it and the only place where something can be done about it, because the jurisdictional problems are right here with this committee.

In 1964, you gave a rule to bring the food stamp legislation to the floor and most of you voted for it. The food stamp program takes in the working poor-the same people you are talking about here. In 1935, whoever your predecessors were established the first guaranteed income we had in this country when they passed the first national welfare law.

Nothing we are talking about here is new. We have had a guaranteed income supported by the National Government since 1935. We have had a program for the working poor since 1964 under the food stamp program. Now, how big is the food stamp program? The President's request for the food stamp program for fiscal 1971 is $1,250 million$1,250 million.

The chairman of this committee on the first day kept talking about the figure of $1,600 for a family of four that had no other income. Mr. Chairman, the figure is not $1,600 for a family of four which has no other income. The figure is $2,464 a year, and whether you make my amendment available or not, if you pass this bill, that is what it is. The CHAIRMAN. $2,000 what?

Mr. GIBBONS. $2,464. That will be the law when the family assistance program passes and the chances are it will be larger than that if somehow in Congress the Senate should prevail because their food stamp program is much larger than the food stamp program that is now in existence.

Now, how does all of this tie together? I am suggesting we take the current food stamp program in effect, and when the family assistance programs becomes effective that we abolish the food stamp program and substitute in lieu thereof an equivalent amount of cash.

If you substitute an equivalent amount of cash for the food stamp program as it would be in existence at the time it was abolished you could save the taxpayers about $276 million from Federal funds and local funds in administrative costs each year.

Now, there is really no reason why it should not be done but we are hung upon a committee jurisdictional problem and the problem is the food stamp program comes out of the Agricultural Committee in both the House and the Senate and the welfare programs come out of the Ways and Means Committee and the Finance Committee of the Senate and never the twain shall meet and the only place it can be heard is right here before your committee, and that is why I am asking you to listen to me about it.

I have prepared an amendment that I will pass around and leave with you, that I will explain in detail as to how it works. The amendment is germane. The family assistance program you have before you mentions food stamps in three or four places in the legislative act so it is possible to amend this bill on the floor, so that food stamps can be turned into cash starting with fiscal 1972, when this program becomes effective, and so that food stamps program would then be phased out.

This is not a new or radical idea. For instance it is in the President's budget. Let me show you page 176 of the special analyses of the 1971 budget. This is what the President said about the food stamp program and the family assistance program:

"Taken together, the family assistance program and the improved food stamp program"-and that is the one we now actually have"would provide a significant improvement in the benefit levels for many poor families. A family of four with no income would receive $2,464 a year."

The President and the Bureau of the Budget recognized the combination of the two programs. It is in the budget right here, and it breaks it down as to what it would be. It would be $1,600 in cash from the family assistance program and $864 in food stamp bonus and the person would end up with $1,272 worth of stamps less the purchase price of $480 for those stamps.

The President recognized it in his welfare message to the Ways and Means Committee and it is right here in part 1 of the committee hearing. (P. 106.) In essence, he says in the long run we should phase out the food stamp program so that no one would be injured, and so that no one would receive less benefit or less purchasing power than they now do under the two combined programs. That is all that my amendment does.

The Secretary of Agriculture and the Secretary of HEW, when they appeared before the Senate on September 15, both testified in the Senate hearings that these two programs should be worked together, should be considered together and they should eventually be turned into cash.

They just did not say when that eventuality should come but they said in turning them into cash nobody should be penalized. That is all my amendment does. It takes the current food stamp program and turns it into a cash benefit to be distributed through the family assistance program and to be distributed to the aged, the blind and disabled as they would normally do.

I have done a little mathematics for you. It is not very difficult to understand. I have a few facts here about savings on the combined program. I would like to pass those around so you can take a look at them.

You can see here I point out that the appropriations request by the President for this year for food stamps is $1,250,000,000 (one billion, two hundred and fifty million) for fiscal 1971. The Senate acted on S. 2547 which came over to the House last September for fiscal 1971. They suggested $2 billion worth of food stamps for fiscal 1971, and $2.500 million worth of food stamps for fiscal 1972.

If you combined these two programs as I suggest in this amendment, the cost would not be $2.5 billion, not the $2 billion but $1.148 million and you would save all the massive amount of paperwork and believe me, it is massive. If any of you want to go into that, I can demonstrate it for you.

To quote Mendel Rivers, it is so ridiculous, it is ridiculous. It would save $276 million in 1972 administrative costs, $184 million worth of Federal cost and about $92 million worth of State costs.

These figures of savings are speculative, but I use the administrative costs for State and Federal and extended them all for those years. But, you would save a lot of money and all you have to do, Mr. Chairman, is do what this committee has not done in 30 years, and that is, grant a rule to allow the Ways and Means Committee bill to be amended on the floor.

The same fellow, who helped me draft this amendment, is the same fellow who drafted the bill that you have before you, I have run over it with many other lawyers and the amendment does exactly that.

I pointed this out in my supplemental views. If you will turn to page 79, of the committee report, you will see there exactly how this works out. You will see that a family of four under the present program, if it is enacted, and the food stamp program as it is already enacted, would have on a yearly basis $1,600 in cash, less $480 of that $1,600 that they would have to pay out to purchase the stamps.

They would then purchase $1,192 worth of stamps and they would have $2,464 worth of purchasing power. Under my merged program, they would still have that amount of purchasing power except they would not have to go through all of this same amount of paperwork and losing time off from work and all of the other administrative things that have to happen in order to get food stamps.

The food stamp bonus would also apply to the aged, the blind, the disabled as it does under the working poor program. I think we have an opportunity here to bridge the gap, a very serious gap that has existed in jurisdiction between committees and to do the proper thing. I will answer any questions you have, Mr. Chairman.

The CHAIRMAN. You say you would save $276 million by your amendment, alone?

Mr. GIBBONS. In administrative costs, if you continue the present program.

The CHAIRMAN. I am impressed with that.

How much is the bill going to cost all told administratively? Mr. GIBBONS. Which bill, Mr. Chairman?

The CHAIRMAN. This bill that we are considering. What is it going to cost to administer the bill under consideration?

Mr. GIBBONS. I could not tell you and I don't think anybody else could. I don't have that figure at my fingertips; $300 million; that is an estimate. This bill is a big bill. It is thick in pages. I would imagine by about fiscal 1972, this bill is around a $10 billion bill, Mr. Chairman. That is not all money. This is old money and new money combined.

The CHAIRMAN. $10 billion?

Mr. GIBBONS. That is roughly what this bill is. It could be more than that, Mr. Chairman. If unemployment goes up, this bill is going to go up with unemployment.

The CHAIRMAN. What assurance can you give us, Mr. Gibbons, that 2 years from now, regardless of unemployment it will not double? I am talking about the bill now, not your amendment.

Mr. GIBBONS. It is only the discipline that members have as to whether it does or does not go up, Mr. Chairman.

The CHAIRMAN. I think the gentleman might be inclined to agree with me that we have not shown much discipline when it comes to physical affairs around here?

Mr. GIBBONS. The present program has been escalating at a very rapid pace.

The CHAIRMAN. Is it not the history of all of these programs, once the camel gets his nose under the tent, to use that trite illustration, that they go up and up and up from there on?

Mr. GIBBONS. There is not really that much new about this program, Mr. Chairman. This committee in 1964 and I think you voted for it and the only one who has never voted for it was Mr. Smith over there, but when you voted for food stamps, you voted to take in all of the working poor because food stamps go to the working poor.

Food stamps can go to more people than this family assistance

program.

The CHAIRMAN. I am not concerned about what I vividly might or might not have done in the past, and I am not admitting that I voted for it. What I am trying to say to you, sir, is, in spite of your counterattack, that, it has been your observation as it has been mine, once these programs start, they accelerate. I will not press the gentleman any further on that but do you have any idea that this program will ever be diminished or repealed once it gets started?

Mr. GIBBONS. Mr. Chairman, it would take a great change in our whole economic system to do it. What we are talking about now are the people at the lower end of our whole economic system. We have never found a way.

We either have to take care of them or they starve. Somewhere back in history, we decided not to let them starve and we have ever since been trying to straighten out the problem.

I think this current bill is better than the previous bill. Many times, it is better to go on welfare and not work at all and not split up your family than it is to have a full job. This bill tries to bridge that gap. I commend the President for this bill.

It is a brief, tough step. It is not quite as innovative as some of us would claim. It is not quite as dramatic and new as some people would think. We have had pieces of it around for years but it does try to pull it together and tries to bring some order out of a chaotic situation.