It does not leave me with much clearer light as to how to avoid the lower incomes. I am led to ask one question just for information: You mentioned incidentally that Jewish aggregations in the cities had a lower delinquency rate than some other nationalities. How is that accomplished?

Mr. BURGESS. I think, first of all, they probably have in most cities a lower proportionate group of low incomes. Then the Jewish community is very well organized. It was well organized to take care of problems of poverty before the Government took over the giving of direct relief.

It was also very well organized to deal with cases of delinquency. It was well organized in providing recreational and educational facilities beyond those of the public school.

It might be said to be a good demonstration of what would take place if we could reduce or abolish low incomes and also provide good community organization, in controlling this problem of juvenile delinquency in our cities.

Senator FLANDERS. That is an interesting story and apparently the Hebrew communities have set a pattern that other communities should have been following.

Mr. BURGESS. Yes.

Senator FLANDERS. May I make two or three general observations, Mr. Chairman?

Senator SPARKMAN. We will be very glad to have you do so.

Senator FLANDERS. As you know, I have not been able to attend all the hearings, and looking back over them, there are two or three things that occur to me. What was the name of the lady from Howard University?

Senator SPARKMAN. Dr. Ware.

Senator FLANDERS. The significant thing in her testimony was the possibility of breaking a chain of economic circumstances, which tends to reproduce itself continuously in succeeding generations. It seems to me that we want to give some attention to that possibility of breaking that chain. One of the main points in her talk-I hope you do not mind, Mr. Burgess.

Mr. BURGESS. I am glad to hear about it. I know Dr. Ware and respect her opinions.

Senator FLANDERS. In her talk she did not give me any clear ideas for our main problem. She indicated that if we raised the whole level of production and employment in this country, it benefited the bottom end of it, which is true enough, but it does not change the relationship. It does not improve the percentage relationship between the bottom and the top, when you lift them all, get them up, get some that were submerged up above their previous level.

The difficulties under which the lower groups work still remain. Then Dr. Schultz' testimony with regard to rural poverty led me to some thoughts which led to a considerable degree of sympathy with one of Congressman Rich's little orations-I am sorry he is not here. He said, "Why not be spending money on these lower income groups or depressed areas in our own country instead of spending it abroad?"

Well, of course, there is more to that than simply raising the economic level of people abroad. We have important political con

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siderations involved in the Marshall plan, which have to be considered.

But the thought did occur to me that it is dangerous for us to be thinking of markets abroad for surplus products in this country as a necessary solution to the problem of maintaining prosperity here because, if we once get the idea and it gets firmly fixed that we cannot be prosperous unless we are shipping stuff to undeveloped countries abroad, we at once come into competition with England's necessity for doing the same thing, with the revived German necessity of doing the same thing, and we are all frantically competing for development prospects and opportunities in the same field against those two particular countries, who are also concerned with the same thing, and who have more severe problems than we have with regard to their own home markets.

Now, let's look at the opportunities of development-of expansion of our industry-from the standpoint of our own low-consumption areas. What can we do about it?

In some respects they are not as attractive areas as some of these areas in undeveloped countries abroad because they do not have undeveloped natural resources, and that is the great pulling power of the flow of our capital abroad and the flow of our capital goods abroad and the flow of our particular line of consumption goods abroadsuch goods as automobiles and things of that sort-which are involved as a secondary result of the expansion of the industry in these undeveloped countries abroad.

But I wonder if there is not an undeveloped natural resource of a different sort that we do not give enough thought to in these undeveloped areas at home, and that is the natural resource of the productive capacity of the people. Can we not focus on the problem of developing that natural resource, and is that not our problem, and is there not a possibility that we can find somehow the way to develop that natural resource and find the equivalent of the things we hope to do by developing other types of natural resources in undeveloped countries?

I do not mean that we should not follow through on point 4, but as its being absolutely necessary for the maintenance of a high level of prosperity in this country that we should depend without any alternative on the shipping of our stuff abroad, it seems to me, leads us into trouble and in a way you support the Marxist idea that capitalistic countries cannot maintain prosperity without exploiting regions abroad.

It seems to me that this is our major economic and social problem in this country-to find out how we can identify, use, and organize the undeveloped resources of human productiveness, represented by these backward areas. It seems to me that sets the problem that we have set ourselves to consider. We do not have the answer, but I think we see the problem, and I hope that our consideration of it will not end with these hearings but that we will try to go further with the

matter.

Dr. Schultz gave some indication of the fundamental elements of the problem in his testimony yesterday. That is all I wanted to say.

Senator SPARKMAN. By the way, Senator Flanders, I am sorry you were not here yesterday afternoon when Dr. Margaret Reid testified, because I think she added something to the thing you pointed out, as

Dr. Ware, Dr. Schultz, and Dr. Johnson brought out in their testimony, that the relative position of these groups was not changing over the years. You mentioned that.

Senator FLANDERS. Yes.

Senator SPARKMAN. Dr. Reid brought out this point, and to me it was rather encouraging, because as I stated here, I have felt somewhat depressed by the testimony of the others. It looked like we were not making any progress. Dr. Reid said, however and I think she properly verified her statement-that even though the relative position is not changing, these people in the lower-income brackets are living better than they did in past years, that our perspective or a proper standard of living is increasing, and that what today we call an inadequate standard, perhaps a few years ago might have been more nearly considered as being adequate.

However, I fully agree with you and I believe all of them have brought out the basic requirements, and I think even in the testimony of Dr. Burgess this morning he stresses the need of productiveness or individual productivity, a higher employment, a bettering of economic conditions generally, to remove many of these pressures that create the very conditions that Dr. Burgess has described this morning.

While it is true he says low income is not necessarily the cause of juvenile delinquency, the conditions which low income imposes upon families many times will produce the juvenile delinquency. I believe I understand that correctly.

Is that not true?

Mr. BURGESS. I would like, if I may, to make a comment on Senator Flanders' statement, not on the whole statement, but on the point that he raised that this dealing with juvenile delinquency may not show the way to solve the problem of low-income families.

A vicious circle is often spoken of in the literature, that poverty leads to bad housing, and that into overcrowding, then delinquency. All of these together constitute a vicious circle and the question may be how to break it at some favorable point.

This committee has been concentrating on breaking it at the point of low income. We have been dealing with the problem of juvenile delinquency in these low-income neighborhoods in Chicago, recognizing that the problem of raising low incomes has not been resolved and may take time. Therefore committees have been organized in local neighborhoods to operate recreational programs and direct them specifically toward juvenile delinquency.

Monday night I was out to one of these neighborhoods, clearly a low-income neighborhood. The average rent is $20 a month, and practically all the people are manual workers, unskilled, a high proportion of unskilled labor in steel and other plants about this neighborhood. A local neighborhood committee was organized of people to develop their own program, be responsible for it, just as they would in well-to-do neighborhoods, and they have developed such a program. They raise money from those who have more income in the neighborhood, as against those who have less, the community fund puts in some funds as well. Of course, they make contributions to the community fund through the factories in which they are employed. They get some contributions from people outside the community as well. The point is that the children from the poorest families have the benefits which these recreational centers provide. They now have

two centers in this little community of 7,500 people, and in each one of them there is a television set. There are very few families in the neighborhood that can have television sets, but all the children in the neighborhood can see television at these centers.

I must confess that while I was there the children were playing games and not one was looking at television. It was interesting to me to see how active games were more significant to them.

Every week they have motion pictures, so if a child does not have the money to go to the motion pictures, he can come here. They provide these low-income families with services they would not otherwise obtain, and might otherwise steal to get money for them. They are not raising their income, but they are raising what the children get, and the interesting thing is that the better-off families in the neighborhood take responsibility. They make a membership canvass for dues, just dollar dues. They get somewhat over one-third of the families in the community to make this payment. Many of the other two-thirds do not even have the dollar for that purpose.

That is one way to raise the actual income in terms of goods and services, although not the money income of these poorest families.

Mr. HUBER. I was thinking while you were talking that there exists in my district a Government housing project. I believe it would be the finest place in my entire district, the third largest in the United States, to rear children. There is a recreational center where they have movies, they have supervised play for children. In our so-called silk-stocking districts, the children are largely unsupervised, it is some distance to any playgound, and some of them are little snobs and I do not think they would want to play in a playground anyhow.

The interesting thing about it now is I hope the Government will sell it to a cooperative being formed by the tenants, who will look after it. It is not fancy or elaborate, but it is the most modern home most of them have ever lived in.

If I may make a brief comment on what Senator Flanders mentioned, I remember Dr. Reid yesterday blamed and probably rightly so the Marshall plan for an increase in food prices, but she would not admit, for better or for worse, that at least temporarily, at any rate, our economy had been aided by the shipments.

I presume you feel it has at least temporarily; is that right, Senator?

Senator FLANDERS. I feel that way.

Senator SPARKMAN. Anything further?

Senator FLANDERS. I think not.

Senator SPARKMAN. The hour of 12 having arrived, the committee will stand adjourned until Monday at 10, and at that time we will meet in room 318.

Doctor, we certainly appreciate your being with us this morning. Mr. BURGESS. Thank you very much, Senator.

(Whereupon, at 12 noon, the subcommittee adjourned, to reconvene at 10 a m., Monday, December 19, 1949, in room 318, Senate Office Building.)

LOW-INCOME FAMILIES

MONDAY, DECEMBER 19, 1949

CONGRESS OF THE UNITED STATES, SUBCOMMITTEE ON LOW-INCOME FAMILIES, JOINT COMMITTEE ON THE ECONOMIC REPORT, Washington, D. C. The subcommittee met, pursuant to adjournment, at 10: 10 a. m. in room 318, Senate Office Building, Senator John Sparkman (chairman) presiding.

Present: Senators Sparkman (chairman) and Flanders.

Also present: Samuel L. Brown, economist, and Mrs. Elizabeth G. Magill, research assistant, Subcommittee on Low-Income Families. Also present: Helen Hall, director, Henry Street Settlement, moderator for the group; Earl Parker, associate director, Family Service Association of America; Mildred Gutwillig, head worker, recreation rooms in New York, National Federation of Settlements; Dr. Margaret Creech, director, department of information and studies, National Travelers Aid Association; Reginald Johnson, field director, National Urban League; Mrs. Gertrude Zimand, general secretary, National Child Labor Committee; Edmond D. Butler, president, National Conference of Catholic Charities; Lt. Col. Chester Brown, secretary, social welfare department, Salvation Army; Arthur Kruse, executive director, United Community Services of Washington, D. C.; and Sirchitz Kripalani, Member of the Indian Legislature and Delegate to the United Nations. [Visitor.]

Senator SPARKMAN. Let the committee come to order, please.

I am sorry that all members of the subcommittee could not be here. today. We did have them all in attendance at different times during the past week, but unfortunately some of them had to return to their homes.

Senator Flanders and I are here and are happy to have you here. with us.

Miss Helen Hall, director of Henry Street Settlement, I understand, will be the moderator for the group.

I wonder, Miss Hall, if you might have those in your group identify themselves around the table for the benefit of the record.

Miss HALL. All right, Senator. We might go around this way, and if each person will tell who they are and what they represent it will make it easier.

Senator SPARKMAN. And from where.

Miss HALL. Yes.

Mr. KRUSE. I am Arthur H. Kruse, executive director of United Community Services here in Washington. It is the over-all directing and planning agency for health and welfare work in the city.

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