Mr. PORTER. So this should be taken into account, the deferred status of third-class mail, in figuring out what the third-class mail people should pay.

Mr. LEDBETTER. But I also know, when the users of third-class talk about deferred service, that as the superintendent of delivery in a large metropolitan city, one of my greatest problems was getting that deferred mail delivered as promptly as the first-class mail users wanted it delivered. We only have about a 24-hour lag, and that mail has to be delivered the same as the other mail. There is no such thing as storing it in the attic or basement and waiting until next week.

Mr. PORTER. But it does not get the priority that first class gets. Mr. LEDBETTER. It does not go that day, but possibly the next day. Mr. PORTER. You have seen this chart, have you not [displaying chart]? It is worked mainly from about 5 p.m. to 8 p.m., and the third-class mail is shunted aside, so that there would seem to be a difference in the treatment, at least in the Washington Post Office; and I would imagine this was general in other post offices. Is it not? Mr. LEDBETTER. Yes, that is true, quite true.

Mr. PORTER. Thank you very much.

The CHAIRMAN. All ringht, thank you very much.

Mr. JOHANSEN. Mr. Chairman?

The CHAIRMAN. Mr. Johansen?

Mr. JOHANSEN. First of all, I would like to compliment you and Mr. Jaspan on this statement.

I notice in one of the last paragraphs you speak of the alternatives of a greater share of the cost being borne by the users or by the taxpayers. Is there not a third possibility, that has been a reality in many instances, and that is that these costs have been evaded and transferred to future generations, in terms of the national deficit, the deficit in the national budget?

Mr. LEDBETTER. There is no question of that, Mr. Johansen, in my opinion.

Mr. JOHANSEN. Of course, there are those who have their own understandable interest in the matter, but the arguments are not going to be settled, and there is not going to be general agreement as to just what the fair share is, or what the allocation for public service should be. But after all that is cut aside, the issue becomes, does it not, the question of whether we are going to meet increased costs, including the cost of a new pay raise, that is very enthusiastically supported by some who are not so enthusiastic for a rate increase. We are going to have to meet those additional costs either by a greater payment by the users, or by additional tax revenues, or by additional debt. Is it not just that simple?

Mr. LEDBETTER. It is that simple.

Mr. JOHANSEN. And would you not feel that in view of the news and the developments of the last few days, there is liable to be a pretty heavy stepup of some of our national defense costs, which ought to also throw some light on the concern about meeting the additional expenses or incurring them, even, in some of the other fields?

Mr. LEDBETTER. I agree, Mr. Johansen.

The CHAIRMAN. Mr. Harmon?

Mr. HARMON. Mr. Chairman.

Mr. Ledbetter, would you care to express your opinion or view as to what percentage of all the mail is a service and what is a business? Mr. LEDBETTER. No, I am afraid that I would not, Mr. Harmon. There is a difference of opinion about that among people much higher than I am.

Mr. HARMON. It has been brought out in these hearings that these people in the mailing business, these people in the mail order business, and the people that send letters and mail are in business to make money, and they use the Post Office Department or the mails to do that. It looks to me as if there is a small amount of service which would be personal letters, and the rest of them would be a business. That is just my opinion. Would you care to say what percentage it is?

Mr. LEDBETTER. When you and I go down to the corner mailbox and send a letter home to mother or dad or something like that, this is a personal letter; but if we drop a letter in there at the same time that is paying a gas bill or a department store charge account, that is business. How to draw the line between those two personal letters would be impossible for me to know. Yet, you may, and I may mail a dozen letters from home each night, or over the weekend, and the next-door neighbor may never correspond with anybody about anything. I do not think he ought to have to pay for my service because I like to use the mails.

Mr. HARMON. I think these hearings have been interesting, in that everybody is in some kind of business to make money, and they do use the mails to make money. In my opinion, they should pay for that privilege.

Mr. LEDBETTER. Yes, sir.

The CHAIRMAN. Mr. Gross?

Mr. GROSS. Mr. Ledbetter, there is nothing in law or regulations that compels third-class mail to be moved within 24 or 48 hours, is there?

Mr. LEDBETTER. It has to be delivered on the second trip after receipt at the point of delivery.

Mr. GROSS. By regulation or what?

Mr. LEDBETTER. Yes, sir; by postal regulation.

Mr. GROSS. Restate that. Third-class mail has to be what?

Mr. LEDBETTER. Has to be delivered on the second delivery after receipt at the office of delivery.

The CHAIRMAN. Are there any other questions?

Mr. PORTER. Mr. Chairman. Do you also favor a second-class increase for the same reason?

Mr. LEDBETTER. I favor an increase in any of them that do not pay their way; and that is true of second-class mail.

Mr. PORTER. But with due regard to the impact on the user, I trust. Mr. LEDBETTER. Yes.

The CHAIRMAN. Thank you very much, sir.

The committee will next hear from Mr. James F. O'Neil, publisher of the American Legion magazine, who is accompanied by Mr. Miles D. Kennedy, director of the National Legislative Commission of the American Legion.

STATEMENT OF JAMES F. O'NEIL, PUBLISHER, THE AMERICAN LEGION MAGAZINE; ACCOMPANIED BY MILES D. KENNEDY, DIRECTOR, NATIONAL LEGISLATIVE COMMISSION, THE AMERICAN LEGION

Mr. KENNEDY. Thank you, Mr. Chairman. My name is Miles D. Kennedy. I am the director of the National Legislative Commission of the American Legion. Our office is at 1608 K Street NW., Washington.

I want to thank you for giving us this opportunity to be heard. I have with me as our witness, Mr. James F. O'Neil, from New York, who is one of our past national commanders, and he is also the publisher of the American Legion magazine.

Mr. O'Neil has a short statement, less than two pages long, Mr. Chairman, and I respectfully request that he be permitted to read the

statement.

The CHAIRMAN. We will be glad to hear from Mr. O'Neil.

Mr. O'NEIL. My name is James F. O'Neil, publisher of the American Legion Magazine.

Mr. Chairman and members of the committee, the American Legion is opposed to the enactment of H.R. 11140-or any similar bills-particularly section 5, in that it would impose a serious financial burden upon the American Legion magazine, the principal communications medium between the national organization of the American Legion and its membership.

Actually our situation is no different than it was in 1958 when the Congress recognized the peculiar problems of publications similar to the American Legion magazine in the nonprofit field. Then, as previously, you granted preferential status for those publications maintained by and in the interest of religious, educational, scientific, philanthropic, agricultural, labor, veterans, or fraternal organizations not organized for profit, and granted an exemption from the postal increases provided for other newspapers and periodicals.

You will recall that the House knocked out the provisions of the Post Office bill in 1958 identical to those now included in section 5 of H.R. 11140. Later the Senate restored them, but the conferees accepted the House-approved version.

Now you have the same language before you that was rejected. We are seeking the same consideration, and for the same reasons.

The proposed legislation would increase the postal costs for the American Legion magazine by approximately $153,000 a year-a small amount, to be sure, contrasted to the $500 million or more contemplated in the suggested legislation. However, it is sizable for us. We cannot be compared to the profit publications, even on a 50 percent basis. We do not attract large advertisers and great revenues, and cannot increase our subscription charges-dues to us at will.

Although I am not prepared to give any exact figures, my best estimates are that the total amount to be realized by including all the nonprofit publications on a 50 percent of the increase spelled out in section 5 would only total about $1 million.

I know of no magazine in the same classification as the American Legion magazine that has a brighter financial picture to report than in 1958, when those specialized nonprofit magazines were given an

exemption status. In fact, almost without exception, we are not as well off as we were 2 years ago.

Therefore, we plead with you to eliminate our magazine from any proposed postal rate increases.

Mr. Chairman, we appreciate your courtesy in granting us an opportunity to appear and express the views of the American Legion in connection with the pending legislation.

The CHAIRMAN. Are there any questions?

Mr. JOHANSEN. Mr. Chairman?

Mr. Commander, I am very happy to see you here, particularly, because I come from a hometown that has another past national commander, Mr. Wagner.

Mr. O'NEIL. He is a fine man. I know him very well.

Mr. JOHANSEN. I would like to ask your comment on one thing, as a citizen, and as a past commander of the Legion-and I am not speaking to the specific point to which you refer, and I am not arguing the point that you make.

Do you not feel that as we increase the obligations and costs of Government, we ought to be sound enough in our fiscal policy, prudent enough, wise enough, and courageous enough, to provide the revenue to pay for it, either out of an increase in the cost to the users of the service, or in additional tax legislation and revenue to meet that cost-particularly in view of the situation that confronts us at this particular moment in history?

Mr. O'NEIL. I wish I had the answer for that, Mr. Johansen. I am afraid I haven't, other than to say this: that certainly we as an organization and I as a citizen would hope that we could reach that position; but there is reason to believe that we can't.

Here we are involved in a situation where we are not in the profit field, No. 1; and No. 2, we do enter into the public service area.

Mr. JOHANSEN. I am not speaking of your particular experience, but I am speaking as a broad national policy. Where we, in the Congress, vote to spend more money, whatever the field, ought we not to provide the revenues one way or another to avoid the threat of a massive inflation and the damage it can do to the economy?

Mr. O'NEIL. I would hope that that could be answered in the Congress of the United States, Mr. Johansen, and I would support it, of

course.

Mr. JOHANSEN. I appreciate that.

The CHAIRMAN. Thank you very much, sir. Mr. Harmon.

Mr. HARMON. Mr. O'Neil, since your magazine does perform a great service, no doubt, and since you do use the medium of your magazine to do a lot of lobbying, do you not think you should pay your fair share of the costs?

Mr. O'NEIL. In answer to that, Mr. Harmon, I would say that performing a service is one thing and lobbying is something else. Î do not know how to make the distinction there. I do not know what you have in mind.

We do pay, of course, a postal rate at the present time. As I have emphasized, we are in the nonprofit field. If a postal rate was applied to us, we would immediately go in the red. In fact, we are operating in the red right now. So this becomes a very important matter to us.

Mr. HARMON. Mr. O'Neil, have you changed in recent years the cost of your magazine or service to your members?

Mr. O'NEIL. Yes, we have, Mr. Harmon. We have tried to reduce the costs in every conceivable way. We have cut the size of the magazine, we have reduced the weight of the paper, we have done everything that good business practice would permit. We have, however, reached the saturation point in that particular area.

Mr. HARMON. But have you raised the price of this magazine to the members? That is what I am asking.

Mr. O'NEIL. No, we have not-in this manner: the dues have been increased, but the price to the members has not been increased as it relates to the particular magazine, to our operation. We have the same allocation now that we had before. And that is based on a membership allocation of 75 cents per member per year for the magazine, 25 cents for rehabilitation, and 50 cents for general expenses, a total of $1.50 per member.

Mr. HARMON. Of course, each member does receive a copy of this; is that right?

Mr. O'NEIL. That is correct, sir.

Mr. HARMON. A monthly copy?

Mr. O'NEIL. That is correct, sir.

Mr. HARMON. Of course, that is your business; but I still think everyone should pay their fair share of this whole thing.

Thank you.

The CHAIRMAN. Thank you very much. Mr. Kennedy.

Mr. KENNEDY. Mr. Chairman, with your permission, I have a short statement from Mrs. Vara V. Gray, who is the national president of the American Legion Auxiliary, and I would like to respectfully request that it be incorporated in the record of the hearings.

The CHAIRMAN. It will be granted. Mrs. Gray's statement will be included in the record.

I might say she is from my home State, only about 25 miles from my hometown. I have known her all my life. She is a very fine person, and I am glad to see her the head of the auxiliary.

Mr. KENNEDY. I will convey your compliments to her. I am sure she will be glad to hear what you have said, Mr. Murray. (The statement referred to follows:)

STATEMENT OF VARA V. GRAY, NATIONAL PRESIDENT OF THE AMERICAN LEGION

AUXILIARY

Mr. Chairman and members of the committee, the American Legion Auxiliary, composed of approximately 950,000 mothers, wives, widows, sisters, and daughters of men who served honorably in the Armed Forces of the United States in time of war, and of women who themselves were in war service, publishes a national magazine known as National News, and a number of State publications to keep its members informed and inspired in regard to the organization's program of patriotic service.

Subscription prices of these publications are kept at a minimum in order that they may reach the largest possible number of our members. Without the present favorable postal rate for second-class mail it is doubtful if these publications could be distributed in the future. We feel that any increase in the second-class rate for publications such as those issued by our organization would be a definite handicap to us in the work we are endeavoring to accomplish.

Also, we feel strongly that the endeavors of women's patriotic organizations are of great importance to the United States as it faces the growing menace of world communism. American Legion Auxiliary publications are devoted largely