cally, but even more urgently in terms of its direction, we need a Department of Metropolitan Affairs, not a Department of Urban Affairs. To solve a plural problem, a plural solution is best.

(2) Statements recurring across America by its proponents seem to suggest that the proposed new department would in fact be a special constituency agency. Will it indeed be responsive to the wishes of all sectors of the metropolitan area? Over the course of time, certain Cabinet posts seem to have become special interest agencies. I am honestly concerned at this moment that the proposed new Department of Urban Affairs might well become little more than a high-placed lobby for downtown interests. I am well aware that the letter of the proposals now before you gives no such clue. I am well aware too of the tenor of certain remarks, in and out of politics, which have been made through the Nation in regard to the spirit of what you are here asked to consider. Again, if there were only one way of doing it, or if the lobby were more needed in Washington today than calm logic about our metropolitan areas, I would sit silent. Actually, there are plural points of view in our sprawling metropolitan areas. Downtown is vital, but suburbia is vital too and growing. I am concerned for the voice of the suburbs in this proposed new Department. I am fearful too that the Department may not bring us íntelligent and detached guidance in the areas of civic change if its energies are to be prostrated to the particular demands of one sector of the metropolitan area. I make no accusations whatsoever, gentlemen. I rise simply to say that as one concerned alike for good planning and moral commonwealth I am not satisfied that as presently before you the new Department would honestly correspond to the ground situation, nor that it would bring to our national councils that balanced overall awareness of our metropolitan problems of which we are in such dire need.

(3) I, for one, have many questions about the Nation's urban renewal experience to date. I am aware of continuing controversy in the area of urban housing. I am further aware of considerable question as to the exact role of housing in the proposed new Department. Under all these aspects it would seem that the Congress will want to look further before it sets up any new Cabinet post in these areas of action. In my recent book "The Church and the Change," I wrote (p. 129): It is already abundantly clear that neither our cities nor our farms are growing. What is growing is the metropolitan area. Semantically, then, if there is to be a new Federal department, it should be a Department of Metropolitan rather than a Department of Urban Affairs * * * let it be a Department of Metropolitan Affairs in action as well as in theory. Let it be an across-the-board authority looking calmly at our changing community in terms of commonwealth and not simply a sounding board for partisan demands. Above all, let it honestly represent suburb and core with the hegemony to neither.

I am suggesting in short, gentlemen, that for the good of all the people in our metropolitan areas you look at this matter further. It is not within your province to determine totally the man who would head up a new department. It will remain ultimately for the President to choose a metropolitan leader conscious alike of suburban, rural and core situations and committed to no one of them. It is within your province so to write the constitution of a new department that, far from being a political plum, it will honestly respond to the honest hopes and individual needs of American citizens living downtown in our metropolitan areas but also to the honest hopes and individual

needs of American citizens living in suburbia and in surviving small towns and rural pockets. The great goal you see, gentlemen, is not strip city, not monotomy, not monolithic direction, but the preservation throughout metropolitan America of individualities, differences, variety. I am convinced that if you take more time, if you act with circumspection in these important matters, all America will be the beneficiary.

If courage is imperative in the circumstances which bring you together here, so is caution.

Senator HUMPHREY. Our next witness is Mr. Dwight D. Townsend, representing the Cooperative League of the U.S.A.

Please proceed, sir.

STATEMENT OF DWIGHT D. TOWNSEND, DIRECTOR, WASHINGTON OFFICE, COOPERATIVE LEAGUE OF THE U.S.A.

Mr. TOWNSEND. Mr. Chairman and gentlemen of the committee, my name is Dwight D. Townsend. I am director of the Washington office of the Cooperative League, which organization is a federation of producer, consumer, and service type cooperatives in the United States. There are now in excess of 14 million families who are members of the organizations that make up the Cooperative League.

We are pleased to endorse Senate bill 1633 which is part of the administration's program for creating a Department of Urban Affairs and Housing.

I am authorized by resolution of the 22d biennial congress of the Cooperative League and implemented by direction of the board of directors to present support for this progressive legislation.

The Cooperative League has had a sense of concern for shifting population and its effect on the general welfare. We have an increasing realinement of our population into urban centers that poses difficult problems not easily dealt with under our present agency form of government. Much of the problem originates in the field of overcrowded urban centers compounded by overcrowding of our transportation system, and furthermore made complex by the inability of a community to provide community facilities commensurate with expanding population.

While we have the problems of transportation, overcrowding in housing and lack of community facilities, we believe it is necessary to have coordinated leadership in urban affairs and housing in view of the responsibilities which are placed in the Bureau of Roads, Health, Education, and Welfare, the Housing and Home Finance Agency, and, in the cases of parks, by the Department of the Interior. Our resulting compounded problem is so involved in redtape, that we need to take drastic and direct steps to meet the urgency of the situation by making one department responsible for administering the program and to have enough authority to be effective.

As though the foregoing were the only parts of this problem, we need to take into account that it involves the complications of relations between the State and municipalities, between the Federal Government and the States, and between the various and sundry local agen

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cies with State and Federal agencies. These difficulties appear most acute in interstate situations in cities like New York and Newark, Chicago and Gary and Kansas City, Kans., and Kansas City, Mo.

Legislation proposed by S. 1633 would go a long way to simplify these problems if the Department were given Cabinet rank with a Secretary at its head. We believe such a Department would not only serve to eliminate the complications of procedure between various agencies of government, but would enable a coordinated program to be executed and administered in the general public interest.

A great reward for this kind of reorganization may well be the reduction of traffic tolls due to our outmoded urban transportation system. Too, it should provide a far more orderly way to police the heavily populated areas where now 70 percent of the country's population lives, and to continue the democratic process of government by the governed. Now that we have this high percentage in our urban population, a place should be provided at the Cabinet table where a Secretary with Cabinet rank for a Department of Urban Affairs and Housing may focus proper attention on matters of housing and urban affairs in proper relations to all the other councils of the Federal Gov

ernment.

Mr. Chairman, this concludes my statement. I shall be glad to answer any questions that you may have.

Senator HUMPHREY. We are very grateful to you, Mr. Townsend. Do you have any questions, Senator Muskie?

Senator MUSKIE. I have no questions, thank you.

Senator HUMPHREY. We are grateful to you, Mr. Townsend, for your patience.

NATIONAL ASSOCIATION OF MUTUAL SAVINGS BANKS

We have here a letter from Mr. McKenna of the National Association of Mutual Savings Banks, New York. I call to the attention of my colleague in the record the statement which says:

Some months ago our national association adopted a position supporting Cabinet status for housing if requested by the administration.

The statement goes on further to point out that the production and transfer of housing facilities and the shaping of an urban environment in which people live and work is clearly among our Nation's most important activities.

Further in the statement it is said that savings banks have a clear interest in urban and housing matters is evident from the facts. Savings banking is one of our Nation's oldest industries, with most institutions located in the central core of the older urban communities.

As a consequence, problems in urban affairs-central-city decay, transportation, land use, renewal and rehabilitation-thrust themselves upon mutual savings banks for solution. It is in the direct interest of savings banking that urban development and redevelopment be soundly conceived and executed. It is our view,

says the statement

that these Federal programs-with respect both to housing and urban affairs generally-will be more effective if administered by a Department at Cabinet level with all of the stature such a level commands and the unification of program and policy it permits.

Then I call to the attention of Senator Muskie that "it is respectfully submitted that the Federal Housing Administration should also be transferred intact, together with all of its functions," and so on.

This is another evidence of support for that position. The entire statement will be made a part of the record.

Is Mr. McKenna here?

Mr. MCKENNA. Yes, I am, sir.

Senator HUMPHREY. Thank you very much for your statement. (The complete statement of Mr. McKenna follows:)

Hon. HUBERT H. HUMPHREY,

NATIONAL ASSOCIATION OF

MUTUAL SAVINGS BANKS, New York, N.Y., June 20, 1961.

Chairman, Subcommittee on Reorganization and International Organizations, Senate Office Building, Washington, D.C.

DEAR MR. CHAIRMAN: Enclosed are six copies of a statement regarding Cabinet status for housing prepared on behalf of the National Association of Mutual Savings Banks by Mr. Robert M. Morgan, chairman of the Committee on Mortgage Investments. It is respectfully requested this statement be included in the record of the hearings currently being held by your subcommittee on S. 1633 and related bills.

Sincerely,

WILLIAM F. MCKENNA, Director-Counsel. STATEMENT SUBMITTED BY MR. ROBERT M. MORGAN, CHAIRMAN, COMMITTEE ON MORTGAGE INVESTMENTS, NATIONAL ASSOCIATION OF MUTUAL SAVings Banks, RELATIVE TO CABINET STATUS FOR URBAN AFFAIRS AND HOUSING

Mr. Chairman and members of the subcommittee, my name is Robert M. Morgan and I am chairman of the Committee on Mortgage Investments, National Association of Mutual Savings Banks. I am also president of the Boston Five Cents Savings Bank in Boston, Mass. On behalf of the national association I appreciate this opportunity to present a brief statement on the proposed legislation to establish a new Cabinet Department of Urban Affairs and Housing.

Some months ago our national association adopted a position supporting Cabinet status for housing if requested by the administration. This position reflected the importance of housing and urban affairs in the social and economic life of the Nation, the basic role of Government in housing and urban affairs, and the direct importance of mortgage finance and urban conditions to mutual savings banking.

The production and transfer of housing facilities and the shaping of an urban environment in which people live and work is clearly among our Nation's most important activities. These activities have significance not only for our economic health but for our social health as well. Recognition of this fact at the Federal level has resulted in the establishment, over 30 years, of multiple agencies concerned with housing, mortgage finance, and urban affairs. Inclusion of these agencies within one Cabinet department would have the dual advantage of coordinating policies and activities, and of raising the stature of housing and urban affairs in the Federal hierarchy consistent with its importance in the economy.

That savings banks have a clear interest in urban and housing matters is evident from the facts. Savings banking is one of our Nation's oldest industries, with most institutions located in the central core of the older urban communities. As a consequence, problems in urban affairs-central city decay, transportation, land use, renewal, and rehabilitation-thrust themselves upon mutual savings banks for solution. It is in the direct interest of savings banking that urban development and redevelopment be soundly conceived and executed. In this regard, savings bankers in several cities have taken an active part in working with local government officials and private citizens on urban revitalization programs, and in providing financing for the building and rebuilding necessary.

The activities of mutual savings banks in financing the Nation's housing and related real estate needs have increased spectacularly since World War II. From less than one-fourth of assets in 1946, savings bank mortgage holdings have risen

to about two-thirds currently. Out of every dollar savings banks have had available for investment in the past 15 years, about 95 cents has gone into mortgages. The bulk of this investment has gone into residential financing, and in recent years savings banks have channeled a larger net flow of funds into federally underwritten mortgages than has any other type of lender. Our interest in Federal housing programs, therefore, is apparent from these facts.

It is our view that these Federal programs-with respect both to housing and urban affairs generally-will be more effective if administered by a department at Cabinet level with all of the stature such a level commands and the unification of program and policy it permits. At the same time this does not mean that all existing agencies need be abolished. Indeed, S. 1633 provides for transfer to the new Department of the Federal National Mortgage Association, together with its functions, powers, and duties. It is respectfully submitted that the Federal Housing Administration should also be transferred intact, together with all of its functions, powers, and duties, rather than abolished as presently called for in S. 1633. Moreover, the importance of FHA in the whole complex of housing and urban affairs is so great as to warrant the appointment of an Under Secretary to handle FHA matters.

In its 27 years of operation, FHA has established a unique record of success in Government-industry cooperation. This success was achieved only after long years of building confidence in the soundness of FHA operations. In partnership with private industry, FHA has revolutionized the mortgage contract, placed mortgage financing on a sound basis, and helped to provide housing for millions of our citizens. Indeed, FHA has become somewhat of a trademark in the mortgage financing world. To abolish this agency now would imply a downgrading of housing and private mortgage finance in the structure of a new Cabinet Department. This would be most unfortunate.

Two other points should be noted about S. 1633. The first is that the declaration of policy makes little or no mention of the role of private enterprise in carrying out the objectives of the new Department. This is a serious omission. The prime role of private institutions-financial, construction, and other-in implementing the objectives of the bill should be stressed at the outset.

Secondly, there is a danger that too many functions will be included under the purview of the new Department. It is not unlikely that in this event the importance of housing and urban renewal will be diluted by the diversion of attention to other miscellaneous facets of urban affairs.

With these important provisos, therefore, we are glad to endorse the proposal of Cabinet status for housing and urban affairs.

I thank the subcommittee for the opportunity to present my views on this important matter.

Senator HUMPHREY. Mr. Williamson, would you come forward and identify yourself for the record? We have Mr. Huber's statement which will be placed in the record at the conclusion of your remarks.

STATEMENT OF JOHN C. WILLIAMSON, COUNSEL, REALTORS' WASHINGTON COMMITTEE, ON BEHALF OF CURTIS E. HUBER, CHAIRMAN, REALTORS' WASHINGTON COMMITTEE, NATIONAL ASSOCIATION OF REAL ESTATE BOARDS

Mr. WILLIAMSON. My name is John C. Williamson. I am counsel to the Realtors' Washington Committee of the National Association of Real Estate Boards. I would like to file for the record Mr. Huber's testimony.

Mr. Huber, of Evansville, Ind., is chairman of the Realtors' Washington Committee and was here to testify on behalf of the national association. Unfortunately he had to leave to make his plane reservation. I thought I would leaf through this testimony.

The National Association of Real Estate Boards desires to testify in opposition to the bill, S. 1633, and our opposition is premised on our sincere belief that its enactment would

(1) not accomplish its purported objective;