GENERAL STATEMENT

Secretary WEEKS. Mr. Chairman and gentlemen of the committee, I have a prepared statement which I would like to submit for the record, and then I will discuss the several bureau requests.

Mr. PRESTON. Very well, Mr. Secretary.

(The statement referred to follows:)

STATEMENT OF COMMERCE SECRETARY WEEKS

Mr. Chairman and members of the committee, it is again my pleasure to appear before you in support of the Department's estimates of appropriations for fiscal year 1959.

The Department's request for fiscal year 1959 totals $858,099,000 out of general fund receipts of the Treasury. In addition, $2,382,692,000 is requested for transfer out of the highway trust fund to reimburse the States for the Federal share of the cost of highway construction. We are proposing this year to finance the cost of the forest highways and the public lands highways programs out of the trust fund. This proposal has been considered very carefully and in view of the fact that for the most part these highways are on the Federal aid system, it is believed that this financing proposal is appropriate and justified.

Eighty-six percent of the general fund estimate is required for transportation activities in the aviation and maritime fields. We propose to continue orderly progress on the Federal airways plan, handle increased workload generated by increased traffic and provide full year costs for facilities and services operating for only a part of fiscal year 1958.

As you are aware, no new funds were appropriated in fiscal year 1958 for new ship construction in view of the fact that there were sufficient funds carried over from prior years to continue the construction program. The Maritime Administration has now contracted for the construction of 16 vessels and with the letting of these contracts all funds currently available for the ship replacement program of the subsidized operators have been committed. The estimates before you will provide for replacement of an additional 18 ships under the long-range ship replacement program.

The balance of 14 percent or approximately $122 million will provide for the other programs of the Department, including the statistical programs of the Bureau of the Census and the Office of Business Economics, services to the business community rendered by the Business and Defense Services Administration, Office of Area Development and the Bureau of Foreign Commerce, the geodetic control and chart activities of the Coast and Geodetic Survey, the administration of the patent and trademark system, the standards and measurement responsibilities of the National Bureau of Standards and the vital services of the Weather Bureau. There follows a brief summation of the requests for the several bureaus of the Department. My assistants and the bureau heads will supply the details concerning each item of appropriation.

GENERAL ADMINISTRATION

The request for fiscal year 1959 as presented in the President's budget represents an increase over the adjusted appropriation for 1958 of $55,400. Except for costs of annualizing contributions to the civil-service retirement fund, this entire amount is required for additional personnel and other expenses in connection with civil defense and mobilization planning activities. The President has transmitted an amendment to the Congress which attempts to clarify the financing of Federal civil-defense functions. In view of this transmittal our request for this item should be reduced by $15,000.

BUREAU OF THE CENSUS

Comprehensive and reliable statistical information on the state of the Nation is essential to guide the leaders of both business and government. Some of this information can be developed on a sound basis only by agencies with the broad authority of the Federal Government. The task of collecting, summarizing and publishing basic data on such lines in many important fields is assigned by law to the Bureau of the Census.

The estimate for the Bureau of the Census proposes to improve existing current measures of our economy as regards consumer credit outstanding; inventories

held by manufacturers, wholesalers and retailers; manufacturing sales and orders booked; construction; and revenues, expenditures and indebtedness of State and local governmental bodies. New surveys are proposed to provide a monthly measure of receipts in the service trades and a quarterly measure of expenditures for additions, alterations, maintenance and repairs on residential properties.

In addition to the maintenance and improvement of current measures provided through the salaries and expenses appropriation, the program for 1959 includes requests for the major censuses conducted at 5- or 10-year intervals to provide detailed and authoritative benchmark data for local as well as national uses. The estimate provide funds to finish the 1957 census of governments, to collect the data and to start tabulations for the 1958 censuses of business, manufactures and mineral industries, and to complete most of the preparatory work for the 18th Decennial Census covering population, housing, agriculture, irrigation and drainage. The enumeration work on the 18th Decennial Census will begin in fiscal 1960.

The Bureau of the Census has again been requested by the Office of Defense Mobilization to undertake a program of data collection, records analysis, establishment identification and location, and related activities in support of the mobilization readiness program. In accordance with the administration's policy of financing these functions, an amount of $300,000 is included in the estimate for "Salaries and expenses" for this purpose.

CIVIL AERONAUTICS ADMINISTRATION

Population growth, technological advances, national defense requirements and public preference are factors contributing to the significant changes taking place in the character of transportation facilities. The oncoming commercial use of jet aircraft dramatically emphasizes the need for expansion of the services and facilities of the Civil Aeronautics Administration. For many years to come aircraft will play an increasingly important role in our civilian economy and our systems of transportation, and manned aircraft will remain a vital ingredient of United States airpower. Changes and expansions that have taken place have outstripped the capacity of the Civil Aeronautics Administration to assure the desired safety in air operations, but we are in the process of correcting this situation.

Perhaps the greatest single contribution to safety in civil/military air operations now possible is implementation of the air traffic control and air navigation system as set forth in the "Federal airway plan." The Congress has supported the first stages of this plan, and only as its implementation is carried out can we expect to provide the effective radar, communications, electronic navigation aids, and trained manpower that will increase safety, expand the system's capacity and guard against midair collisions of aircraft.

The estimates for CAA provide for:

(a) orderly progress on the Federal airway plan;

(b) handling workload generated by increased air traffic;

(c) full-year costs of facilities and services operated on a part-year basis in 1958; and

(d) recruiting and training of personnel to operate and maintain new facilities, inspect and certificate the growing complex of airman, aircraft, and operators of air agencies.

In addition to these growth and need factors, the CAA is involved in and affected by two other major developments of economic significance.

I. A long-term effort has finally resulted in an agreement between this Department and Defense covering the joint civil/military use of air navigation facilities. This committee having expressed its concern with the subject, I am pleased that we have progressed considerably in the field of joint use of long-range radar, and as a result some economies are reflected in this budget estimate.

II. User charges for the Federal airways system have been an objective for some time. Legislation is now before Congress that would establish a basis for the civil users progressively assuming their fair share of the costs. Revenues under this fuel tax program would increase from an estimated $65 million in 1959 to $211 million by fiscal year 1963, and as planned, the structure would recover a substantial and increasing amount for the civil user share for use of the Federal airways facilities.

Recognizing the effect on our national economy of the transportation systems that are available and the ever-increasing demand for more facilities that will assure safety in the use of airspace, there is ample evidence of the need for expansion and improvement in the services of CAA. In light of these circumstances

and the principle that we should recover full costs to the Government for services that provide special benefits to individual groups, this administration is moving forward and urging the early adoption of an adequate user charge system.

COAST AND GEODETIC SURVEY

For the past century and a half, the Coast and Geodetic Survey has been making scientific and engineering contributions to the development of our commerce, industry, and natural resources.

The aeronautical and nautical charts produced by this Bureau are a main factor in safe marine and aeronautical navigation, both civil and military. Its geodetic control operations are the basis for all Federal mapping and provides the framework for engineering necessary in flood control, power, and irrigation projects, State, local, and private property boundaries, highway and other construction. This function is extremely important, and has been assuming increasing significance in the guided missile program of the military.

For the 1959 fiscal year we are requesting $11,750,000, an increase of $200,000 over the 1958 appropriation. This increase covers two items; the additional cost of retirement pay for commissioned officers and expansion of the aeronautical charting program based on the accelerated needs of civil and military aviation. The balance of the Bureau's programs will continue at the level attained in fiscal year 1958.

BUSINESS AND DEFENSE SERVICES ADMINISTRATION

The request for the Business and Defense Services Administration includes funds to restore partially what I believe are essential services, especially in the industry divisions. The budget reduction for fiscal year 1958 caused a diminution of activity not only in our defense program, but the Department's services to business.

The defense program includes the defense materials system which supports the procurement programs of the Military Establishment and the Atomic Energy Commission; it also includes the mobilization preparedness program. In these programs are basic industrial analyses and data deficiencies which must be corrected, and the budget we are presenting is designed to correct these deficiencies.

In the Office of Technical Services I am prepared to move ahead on a program which I believe is absolutely necessary. That is a national clearinghouse to distribute all Soviet bloc research studies, journals, and monographs.

The urgency of this matter prompted me to submit a supplemental request this fiscal year. Your committee seemed sympathetic, but wished to defer consideration until the fiscal year 1959 budget was presented.

The legislative authority for the program we propose will be found in Public Law 776 of the 81st Congress, approved September 9, 1950.

Events of the past few months have stirred every American to the need for meeting the challenge of Russia in the field of scientific information. The program at present is just simply not adequate to meet this challenge. For this reason I feel I would be remiss in my responsibility if I did not report to the Congress the need for an expanded program to acquire, translate and distribute technological and scientific information.

In addition to the Government materials which are uniquely and immediately available, we will invite friendly governments, universities, industry, and private translation agencies to assist us, thus enlarging our records of translations completed and translations in progress. When in full operation, we will have a national clearinghouse of all known foreign research data which has been or is being translated. This will effectively widen the knowledge and use of foreign developments and will save funds by avoiding fruitless and duplicate translation and research of identical papers.

I believe this program will serve the best interest of the American people and I urge this committee to provide the funds requested in the Department's estimate. I find it imperative that studies be made to determine inventory and production of survival items. Funds are requested to acquire statistical data on these items. To improve services to those engaged in the field of marketing and distribution we are requesting funds to provide a series of marketing studies and reports which will be expecially useful to smaller businesses. Also funds are requested to provide for a training program for approximately 600 executive reservists which have been recruited.

OFFICE OF AREA DEVELOPMENT

The Office of Area Development provides technical assistance to States and communities on economic development matters. This Office has a small but effective staff which is nationally recognized for its talent in the rapidly growing area development field. With a limited staff, the office has been able, through its working relationships with State planning and development agencies and private groups, to make its advisory services and technical publications available to many communities throughout the country.

Special effort is made to counsel labor surplus area groups in the field on such matters as planned industrial parks, industrial development financing, locating industrial prospects, and Federal programs which may be of help in supplementing local efforts to strengthen local economies.

Suggestions are made to private industry that they look into the possibilities of expanding operations in these areas to provide permanent employment. In fiscal 1959 the community advisory activities of the office are expected to continue at a high level.

BUREAU OF FOREIGN COMMERCE

The consistent goal of the administration and the Congress has been to do everything possible to increase the contribution which private enterprise in the foreign trade and foreign investment fields makes to the economy of the United States and the economic strength of our friends abroad. With this in mind, an increase is requested for the Bureau of Foreign Commerce. The additional funds are for the purpose of analyzing and getting into the hands of businessmen the larger volume of useful information which is being received from our foreign posts as a result of the State-Commerce agreement to strengthen the commercial work of the Foreign Service.

The Bureau of Foreign Commerce operates on the fundamental premise that, in the main, it is private industry and private business initiative that must carry the burden of expanding trade, investment and tourism. We recognize, however, that individual businessmen, particularly the smaller businessman, cannot obtain all the necessary information from private sources to formulate sound policy for foreign operations. Up-to-date information on tax laws, customs nad currency regulations, licensing procedures, local marketing practices, etc. ordinarily can be obtained readily by the American businessman only from the experts in the Department of Commerce backed by the Foreign Service of the United States. The program of the Bureau of Foreign Commerce is dedicated to providing those tools which the businessman needs and which he should reasonably expect his government to provide. I strongly urge, therefore, your favorable consideration of this request so that we may continue to provide these vital services.

OFFICE OF BUSINESS ECONOMICS

On many previous occasions I have expressed my high regard for the solid contribution made by the Office of Business Economics in producing the facts on the national income and product that form the framework for evaluating the economic situation and trends, both by Government and by private enterprises. Keeping track of changes in the national economy is a matter of major concern at all times, and is especially vital at present. The yardsticks of national income and gross national product are a chief tool for the formulation of Government economic policy and of business programs.

In the light of present and future needs, our Office of Business Economics needs strengthening. The National Bureau of Economic Research recently made an objective study of our national income work, and its National Accounts Review Committee report recommended immediate action toward the end of making further progress on these accounts, and improving their timeliness. I feel strongly that the facts relating to the need for expansion and improvement are well established and conclusive. The increase requested for this work in fiscal 1959 is urgent and richly deserving of favorable consideration.

The remainder of the increase we seek for the Office of Business Economics would go principally for a survey of United States private investment abroad. The last survey covered the year 1950, and up-to-date information on the experience of our private investments in foreign countries is essential for business as well as Government operations. The pressing need for this information has been urged upon me by private industry as well as by Government agencies, and I am convinced that action to this end is required now.

MARITIME ACTIVITIES

The estimates for the Maritime Administration reflect continuation of the long-range ship replacement program and a research and development program particularly in the field of nuclear propulsion, looking toward ship designs and operating systems which will improve the competitive position of the merchant marine and it is hoped eventually reduce subsidy costs. The replacement program provides for the construction of 18 ships.

The funds included for operating-differential subsidies will continue payments due ship operators on an almost current basis.

The estimate for activities covered under the appropriation "Salaries and expenses" represents a reduction in the amount available for these purposes in the current fiscal year and contemplates continuation of recurring activities at the 1958 level.

The program for training cadets to become licensed officers in the merchant marine at the Federal Maritime Academy and through financial aid to the four State maritime academies will continue at the current year's level.

PATENT OFFICE

We are requesting for fiscal year 1959 the same amount as the appropriation in fiscal year 1958 for the Patent Office. Because of major increases in cost, this amount will provide for a level of operation somewhat under that contemplated in the 8-year program. However, the request is considered to be in keeping with the main objective of that program-to get the work of the Office on a current basis as soon as possible with the resources available.

As a result of the increased resources made available to the Patent Office in 1956 and 1957 the backlog at the end of fiscal year 1957 was 215,535 as compared with 217,000 forecast when the 8-year program was formulated in the spring of 1955. It is estimated that the backlog will be reduced to a level of approximately 200,000 at the end of 1958 and 190,000 at the end of 1959. The ultimate objective is to have a backlog of about 100,000.

Thus I feel that in general the Patent Office is making good progress toward its goal of getting its work on a current basis. It is important that this progress continue in order that the American patent system may make its appropriate contribution to a healthy economy and an adequate defense effort.

In this connection I am pleased to report that inventive activity continues to be high in the country. Direct evidence of this fact is the continued high rate of filing of applications-about 75,000 per year. As you know, the American patent system directly serves our free enterprise economy and I feel certain that this high rate of filing is indicative of a basically healthy economy which continues to have within it the means for continued improvement and expansion thrugh the stimulation of inventive genius.

BUREAU OF PUBLIC ROADS

Federal-aid highways is the major item in the estimates of the Bureau of Public Roads for fiscal year 1959. Under this heading we include the estimated payments to States for work on the National System of Interstate and Defense Highways, as well as the regular primary, secondary, and urban highway programs. The total of the Federal aid-highway estimate is $2.350 billion, which is almost three times as large as the appropriation for 1957, the first year of the expanded highway program. The magnitude of this estimate reflects the excellent progress being made by the States in advancing the construction of the interstate system. Receipts in the highway trust fund are approximating the Treasury Department estimates and revenues will be more than adequate to finance the current estimate. In previous years, appropriations for forest highways and public lands highways have been made from the general fund of the Treasury. Effective July 1, 1958, it is proposed that both of these programs be financed from the highway trust fund. This proposal has been considered very carefully in light of the purpose of the highway trust fund in relation to the nature of the forest highway and public lands highway programs, and it is believed that this change in financing is appropriate and justified. The appropriation requests for forest highways and public lands highways represent liquidation of contract authority and are in line with the authorized program levels.