2. Authorizations not requiring current action by Congress (permanent)—Con. [In millions of dollars]

3. Programs which are generally mandatory under existing law (not included

Cochairman MONRONEY. There are certain uncontrolled and uncontrollable areas that you must meet.

Representative HALL. This would include the interest on the debt. Cochairman MONRONEY. That is what I was driving at and I think we would like to have examples of those in amounts and in average. Mr. SCHULTZE. For example, just to get some idea a little firmer of what you have in mind, take the case of construction. Representative HALL. Construction.

Mr. SCHULTZE. Construction. You start a project. Theoretically and legally there is no question but that we can cut off a project; the Congress and we together can cut off a project.

Representative HALL. That sounds better.

Mr. SCHULTZE. I would keep that out of the tabulation of relatively uncontrollable expenditures, even though as a practical matter you are pretty sure once it is started it is going to go ahead. But I would not put that in the figures that I would give you, even though from a practical standpoint Congress does have control of it.

Representative HALL. Would you put a 50-year hydroelectric flood control dam project payout and/or payback

Mr. SCHULTZE. I will put it in a separate category.

Representative HALL. Well now, you see, Mr. Chairman, that is the reason I raised that point and put the phrase in, their emphasis on definition of back-door spending. Admittedly a lot of this, such as interest on the debt or the veterans' pensions, it is a commitment; it is as firm as we in good faith, as the Federal Government, can make it. And it is going to have to be paid out by future generations. That is kind of a hairy phrase and I don't mean to use it in that context. But I would just like to see this budget breakdown including the attempts at backdoor spending in the ordinary current context of that phrase, as the chairman has asked for, vis-a-vis our recurring indebtedness, what proportion of the annual budget that is, and then the other major items of the budget.

It seems to me like it could be broken out in a fairly good table. But I realize you have problems of where do we start and where do we stop. Mr. STAATS. There is a definitional problem. One category is permanent appropriations which don't go through the appropriation or legislative committees. Interest on the debt is a good example; that is permanently appropriated by the Congress.

Representative HALL. Maybe that is what I am asking for, Mr.

Staats.

Mr. STAATS. Well, you have. I think in the spirit of the question, though, we ought to go beyond that.

Representative HALL. Good.

Mr. STAATS. You have a second category where there need to be commitments made by local authority, and the airport aid program is a good case in point.

Representative HALL. Yes.

Mr. STAATS. Where the cities need to be in a position to bind themselves by taxes or by issuance of obligations to finance their share of a local program, and this has been done in the form of contract authority in some cases.

In other cases it has been done through the advanced appropriations such as the airport aid program and possibly the urban renewal program this year.

Then you have a third category which is operable through individuals who apply, veterans' pensions, public assistance, and many of our grant-in-aid programs which are set up on a formula basis in which, without a change in the law, you can't very well change the amount of money which is appropriated.

Mr. SCHULTZE. I would like to elaborate on that for a moment. What you will get out of much of this table, a very large part of it, will be expenditures over which the Appropriations Committees have little control, but over which the Congress has, of course, theoretically, complete control. Veterans' pensions is a case in point. Given the law, the expenditures naturally flow from it and it is just a matter of estimating how much they are going to be. Theoretically, of course, it is always possible for the Congress at any given time to change that law to reduce or to raise those pensions. So, a large part of this table will contain numbers which are committed only in the sense that the Congress has to change a law, not an appropriation, to make a change in expenditures, and I presume that is what you are getting at.

Representative HALL. Yes, and I presume as of any given time that you select as of June 30, I guess it would be satisfactory to you, Mr. Chairman, I think that would be very valuable to the committee. I don't want to get you into the nuts and bolts of change. Let's try to give it just as of

Mr. SCHULTZE. You want a broad idea.

Representative HALL. A broad idea on the particular time. Let's don't get into the question of requisite legislative authorization prior to appropriation, or hanky-panky between the two Houses based on the Constitution and so forth.

But from your point of view exactly where you stand as of a given time, broken out in percentages of these different categories. Mr. SCHULTZE. Yes, sir.

Mr. STAATS. The central point here, though, is to what degree do we have flexibility to alter the direction of, or the amount of any appropri

ation for given programs as of a given time, and over what period of time could that redirection take place by virtue of the working either of an appropriation bill or the authorizing bill.

Representative HALL. Of course, that is a very vital question. It came up, as a matter of fact, on the floor of the House yesterday in considering the annual foreign aid appropriation bill. I don't believe what the chairman asked for, as far as the estimate of annual "backdoor spending," or what I want, need go into that detail of that particular question of flexibility and illustrative appropriation to a department and switching within it and so forth and so on into different programs.

I realize that is a real problem for you; it is a real problem for the Congress, for the Appropriations Committee if they are going to exercise any surveillance or oversight. But if we can just get a slice across at one given time that would satisfy my portion of the request. Cochairman MONRONEY. I think it would be more illustrative than any other thing we can do.

Representative HALL. I would like to go back to our other colloquy about the back-door spending.

Would you agree with the definition of back-door spending of the chairman of the House Appropriations Committee as being that which is not channeled to the Committees on Appropriations of the House and Senate if such spending is authorized in the legislative bill and requires no Appropriations Committee action?

Mr. SCHULTZE. Basically I would agree with it.

Representative HALL. I think that is a simple definition.

Mr. STAATS. Excuse me, would you say "requires no action" or "over which the Appropriations Committee has no discretion"?

Representative HALL. I am not trying to develop our definition. I appreciate your addition. I was literally reading from Chairman Mahon's testimony here when I asked him the same question, and he says, "I think that back-door spending is that which is not channeled." Mr. SCHULTZE. Yes, basically the same.

Mr. STAATS. Basically the same.

Mr. SCHULTZE. We have had some arguments occasionally as to whether the provision of funds through authority to borrow from the Treasury even when it goes through the Appropriations Committee is back-door financing. We have said, and the Appropriations Committees have agreed, this is not back-door spending or financing, so long as it does run through an appropriation bill.

Representative HALL. That is good. That is exactly what I wanted to bring out for the committee's information, granted that admittedly, and I think Chairman Mahon was trying as a result of my question to give a very simple and very boiled-down answer in sum; I just thought that might help.

Representative HECHLER. Can I ask a brief question at this point? Would you say the trend has been toward greater flexibility, and a great opportunity for independent judgment and control over appropriations over the years, comparing this with the situation 15 years ago?

I recall about 15 or 20 years ago when Senator Byrd, of Virginia, made a proposal to cut the budget 10 percent. We worked out a study at that time to ascertain which of these appropriations or expenditures were fixed by law and controlled. I wondered whether you would care

to guess in your judgment whether this trend has been more toward flexibility or inflexibility. If you can't answer that off the cuff

Mr. SCHULTZE. I doubt if I can answer it off the cuff. I can maybe say two or three things about it.

First, the larger your military expenditures are as a part of your budget, the more difficult it is in any single year to control the rate of expenditures, because so many of them are simply flowing from long leadtime procurement contracts made earlier.

Similarly the larger construction is as a part of your general governmental program the more difficult it is to control expenditures in any given year because they in turn flow from starts made earlier.

On the other hand, a lot of the new legislation relates to grants-inaid and transfer payments of one kind or another where the Congress, now usually through a legislative committee, can make fairly substantial changes up or down in a program in a given year.

While I can't tell you where it now rests compared to where it rested 15 years ago, I would say these three things are the major parts of it—procurement, construction, and such laws as veterans and public assistance working in one direction, locking you in, and very heavy amounts of transfer payments, aid to education, and grants-in-aid to States, working in the other direction. I would be glad to try my hand at a page or so of impressions on this if you would like, but at the moment I can't do it.

Mr. STAATS. I believe that the proposal that you referred to had to do with appropriations.

Representative HECHLER. Yes.

Mr. STAATS. And had to do with a given year. The problem becomes much more complicated if, as Mr. Schultze says, you are talking about expenditures for each year because much of your expenditures are committed either by contracts or other obligations entered into in prior years.

So that, as a generalization, if you look at it on an expenditure basis, I think there is less flexibility than there was 15 years ago, without much doubt, and this is due in large part to the extent to which grantin-aid programs, for example, have increased very substantially during that period of time.

The portion of the budget which is represented in the capital outlays through the Defense Department, through the space program, through aviation, and through our public works programs, and through resource development, these have increased substantially in the course of the years. So, on the expenditure basis, I think there is not much doubt but there is less flexibility within a given year to alter the expenditure pattern. The obligation pattern is a different thing. Representative HECHLER. Thank you.

Senator BOGGS. Mr. Chairman, I wonder if I might ask a question on a point Congressman Hall raised?

What would be the objection to having Congress consider, instead of the independent offices appropriation bill or the Treasury-Post Office appropriation bill and all the rest, a single measure for fixed appropriations?

In other words, a single bill to consider all of those things that are fixed by law, such as interest on the debt, construction, and other obligations that have already been made. Under that situation we'd