the arts.

The arts here again, as someone said, it's not just painting. It's not just music. It's a whole lot of things. And I think that I came to Congress hoping that I would always keep an open mind on any issue and any subject and be open to education on those subjects and not have minds set in concrete for or against something but really look at the facts, not myths, but facts, because too many times we take isolated instances and blow those up to be the rule, rather than the exception.

I would hope that you would really take a hard look at this, Mr. Armey, and look and see the value of the art, especially among the poor and the minorities.

Mr. Armey. If I may - and, Mr. Chairman, I'm being told I must leave, but I would like to respond. One of the great privileges of my youth was that I got to be on the last of Mrs. Jackson's tours and in her 50 years of touring the State of North Dakota with her little theater group. That tour went on before and ended long before there was a National Endowment for the Arts. But we did get around with our little theater to all of those little remote communities. And I remember the last play I was in we had to come back six weeks after we were done and do it over for a little community theater from a community of 1,500 that were going to do the same play. And they were doing it on their

Mr. Martinez. Do you remember back how you struggled?

Mr. Armey. If I might also point out that I spent a good deal of my time working on two of the Indian reservations in North Dakota, the Turtle Rock Indian Reservation and Fort Totten Indian Reservation, among the great American Sioux tribe, one of the great tribes of this country. And for all the time I was there on the reservations visiting with people and seeing their testimonies and their comments, one of the great laments they had was how much of their art, their culture, and their background in history they found slipping away from them because they had been brought so strictly and rigorously under the tutelage of the federal government. I don't think the federal government of the United States did that great nation any great benefit.

Mr. Martinez. I agree with you, but there are places on Indian reservations where NEA grants are helping retain that. I think that's what you maybe ought to think about.

Mr. Armey. And I would only suggest that they would have done it better if we had stayed out of their business in the first place.

Mr. Riggs. Mr. Leader, thank you very much. We appreciate your testimony and you making time in your busy schedule to join us today.

Mr. Armey. Thank you.

Mr. Riggs. The majority leader is excused.

Mr. Riggs. We'll call forward the second panel of witnesses, our colleagues, the honorable Cliff Stearns, John Doolittle, Ron Lewis, Amo Houghton, Louise Slaughter, and David Skaggs.

At this point, I'm going to surrender the chair and turn over the gavel to Mr. Hoekstra.

I apologize. Mr. Nadler. No sleight intended. I was just reading off the list here. I apologize.

Mr. Hoekstra. [presiding] Before we get to the panel, we're going to allow the subcommittee chairmen and ranking members to provide their opening statements. Let me begin with mine so that we can put this in a little bit of context.

STATEMENT OF THE HON. PETE HOEKSTRA, A CONGRESSMAN FROM THE STATE OF MICHIGAN

Mr. Hoekstra. For the last four months, my subcommittee has been involved in an intensive oversight activity on the National Endowment for the Arts. It's really the first significant review since 1979.

The oversight work really has been consistent with the other oversight activities that my subcommittee has been involved in, where we ask three questions: Is the funding for the NEA an appropriate federal role? Is the NEA operating in an effective and efficient manner? And, third, is the NEA operating in accordance with congressional intent?

Let me just summarize the initial findings. Does the NEA fulfill an appropriate federal role? We did an evaluation of what the arts industry looked like in America today. We found an industry that is alive, and it's booming. Attendance is up in all arts categories: from museums and operas, to plays and ballet. Total receipts for performance arts events rival the level of receipts for spectator sports and the motion picture industry. The employment and earnings levels of artists in almost every category are up. In fact, artists earn well above the average of the rest of the labor force and experience unemployment rates equal to or below most other workers.

Are the arts flourishing because of the NEA's support? Hardly. While the NEA would have us believe that it is the key to the survival of the arts in America, this is the equivalent of crediting the rooster for giving us the sunrise. Here are the facts. First, private arts funding, which has been steadily increasing since at least 1965, is the key to the success of the arts in this country. This private giving dwarfs NEA funding, which accounts for less than one percent of total arts spending. Unlike NEA funds, private giving is directed to the arts organizations of the giver's choice, not by government bureaucrats. The federal government subsidizes this choice by providing over one billion dollars in arts subsidies through the federal income tax deduction for charitable giving. This subsidy far outweighs the importance of the NEA and is a far better and more efficient way to subsidize the arts. Funding for the NEA is even dwarfed by other federal spending on the arts and humanities, including the tax subsidy, the Smithsonian, the National Gallery of Art, the Kennedy Center and many other programs. In fact, the NEA accounts for less than five percent of total federal cultural support.

Is the NEA operating in an effective and efficient manner? The evidence that we have seen so far would say perhaps not. First, the NEA has high administrative costs. In fact, administrative costs at the NEA have increased from 14.4 percent in 1994 to 18.8 percent in 1996. While the NEA has assured our committee that these costs will fall to 17 percent in 1997, this is still an unacceptable level for an organization that distributes a large portion of its appropriations through a set formula. The truth is that in 1996, closer to 25 cents of every dollar given to the NEA went to a bureaucracy and not to an artist.

Does the NEA follow congressional intent? Finally, the NEA continues to operate outside the intent and will of this and past democratically controlled Congresses. I find it interesting to listen to my colleagues. I think we're almost talking about two different organizations. The evidence that we'll see later on as we go through the

process is that much of the NEA funds either goes to bureaucracies, it goes to large well-off financial or artistic institutions. It's not going for education. And it's not going to make the arts available in under-served areas. I mean, we're looking at two different organizations here.

In closing, I think that, as I have taken a look at it, the findings should raise serious concerns in reasonable people. But, instead, they've caused columnists to attack me personally. And one of today's witnesses compares me to Senator Joe McCarthy.

It's kind of fun watching what happens here, that, rather than debating the issue of the arts, the individuals who support the arts or so-called support the arts have decided that they won't listen and debate, but, instead, when the data is stacked against them, they will resort to personal attacks.

The National Endowment for the Arts has evolved into a feel good program, and it hasn't been delivering the kind of results or the dynamic energy we would like to see in the arts area. It's my sincerest hope that this hearing will go beyond nice stories, it will go beyond personal attacks and look at the facts.

[The statement of Mr. Hoekstra follows:]

WRITTEN STATEMENT OF THE HON. PETE HOEKSTRA, A CONGRESSMAN FROM THE STATE OF MICHIGAN - SEE APPENDIX B

Mr. Hoekstra. Mr. Martinez?

Mr. Martinez. Thank you, Mr. Chairman.

STATEMENT OF THE HON. MATTHEW G. MARTINEZ, A CONGRESSMAN FROM THE STATE OF CALIFORNIA

Mr. Martinez. Let me start out by saying that, unlike what Mr. Armey stated, the value of the NEA is not in the stamp of approval of art but in the enrichment of people's lives. Mr. Chairman, any investigation will lead the person who is doing the investigating to find what they want to find. Perception is in the mind of the examiner. And if you look only for the negative, that's all you'll find.

I want to say to you, though, that before we declare that it's a witch and burn it at the stake, we ought to take time to review the activities of the National Endowment for the Arts as they are today. You know, I can honestly say that in times past, I was not one of the NEA's supporters. I was one of their critics. But the endowment is much different today than it was ten years ago, five years ago, even two years ago.

The reforms that we enacted in the last reauthorization combined with deep cuts in appropriations during the 104th Congress have drastically changed the way that the NEA provides support for the arts. No longer are grants given to individuals. Subgrants are no longer permitted. And grantees are required to submit a final report before receiving the full balance of their grant. These are ways in which the NEA has imposed reforms on itself since we have failed to give it an authorization including methods to track where the grants go and review the final product of those grants.

Please understand that the NEA brings the arts into communities that may have never had a chance to experience a symphony, a classical ballet, or a classic work of art. Not only that, the NEA also fosters the growth of local talent and cultures.

For example, the NEA grantee in my district, Self-Help Graphics, provides Latinos in East LA with the opportunity to learn graphic design and produce art themselves. The art that they create is now renowned nationwide. These individuals may never have thought to pursue a career in the arts without Self-Help Graphics. They never would have found the talent that lies within themselves.

In inner cities, schools can barely afford the basics. And I say to you if a school cannot afford pencils or textbooks, it surely is not going to provide a class in music or art. And this becomes a tragedy when you consider the benefits of arts education that are being denied to these children.

Studies show that early exposure to music encourages cognitive development in the very young children. Why? Because research shows that children exposed to music, dance, and drama in school do better on their SATS, have greater self-esteem, and are better able to work in cooperation with others.

My dear colleagues, to deny our children the beauty of the arts is to subject them to a dull black and white world. We don't need to do that. The NEA can fill the gap that is left by the schools that cannot afford arts education. And I affirmatively believe that the arts can bring people together, foster greater appreciation for the varied cultures, beliefs, and differences in ourselves, and the perspectives that make each community and our nation unique.

And to my colleague Frank Riggs, who has been so cooperative on so many things, what I say now is with the deepest regret. It is upsetting to many of us, even offensive, that the wonderful work that the NEA does has been twisted for political purposes. I detest the underhandedness of the Republican Committee staff in questioning grantees. The ways in which staff have misrepresented themselves to grantees in order to coerce them into relating whatever information can be twisted to serve their purposes, are reprehensible.

With my testimony, I am including into the record an article from the April 16, 1997 edition of the San Francisco Bay Guardian entitled "Witch Hunt." This article details how a Republican staffer was not forthcoming with grantees when compiling information about their funding sources. From my understanding, this is not a problem that is concentrated in California but has affected grantees throughout the country.

I would also like to insert into the record a letter from five organizations, the People for the American Way Action Fund, the National Campaign for Freedom of Expression, the National Association of Artists' Organizations, the New York Foundation for the Arts, and the Fund for Folk Culture, objecting to the methods employed in collecting information about NEA grantees.

These underhanded tactics just show how some members will go to any extreme and stretch the truth and the limits of ethics to serve their own ends. This is an act of desperation that I hope will only serve to discredit the instigators.

I look forward to the testimony today that will help dispel the myths that some of the Members will present as truth. I would like to thank the advocates of the Endowment for coming before us today and to fight for the future of the National Endowment for the Arts.

Thank you, Mr. Chairman.

[The statement of Mr. Martinez follows:]

WRITTEN STATEMENT OF THE HON. MATTHEW G. MARTINEZ, A CONGRESSMAN FROM THE STATE OF CALIFORNIA - SEE APPENDIX C

Mr. Hoekstra. Thank you, Mr. Martinez.

As we go through the data today, I would encourage you that if you see incorrect data, we'll be more than open to having it corrected and make sure that the appropriate information and the accurate information gets into the record.

Mr. Riggs. Thank you, Mr. Chairman.

STATEMENT OF THE HON. FRANK RIGGS, A CONGRESSMAN FROM THE STATE OF CALIFORNIA

Mr. Riggs. I'm going to be extremely brief because I know our colleagues who have joined us here today have been waiting patiently for their opportunity to make their statements. And, of course, colleagues here on the subcommittees' panel have been waiting patiently, as well.

I just want to assure all of my colleagues that, as the Chairman of the authorizing subcommittee, the primary reason for scheduling this hearing today is to receive testimony on the current mission of the NEA, whether it works, as Mr. Hoekstra said, in an effective and efficient manner and one that is consistent with congressional intent.

The witnesses that we have invited to testify represent a broad range of opinions on both sides of this particular issue, and they will explore, in detail, many of the current issues facing the NEA today. It is my hope that this testimony will assist the authorizing subcommittee as it deliberates the current unauthorized status and longterm future of the NEA, particularly given the majority leader's comments regarding what he perceives as a binding agreement which survives from the last Congress and carries over into this Congress.

Having served on the Appropriations Committee in the last Congress, I also believe that this hearing and the testimony we will receive from our witnesses will serve the additional purpose of aiding appropriators as they make funding decisions for the next fiscal year.

Given the full slate of witnesses that we have and the schedules of all of those who are participating, I want to stop here, but, again, thank our witnesses for being with us today and tell them I look forward to their testimony. [The statement of Mr. Riggs follows:]

STATEMENT OF THE HON. FRANK RIGGS, A CONGRESSMAN FROM THE STATE OF CALIFORNIA SEE APPENDIX D

Mr. Hoekstra. Thank you.