the needs of people. Another is that effective delivery of services has proven to be beyond the administrative capability available in many communities. particularly in those most in need of assistance. Efforts are underway to bring the various programs under one roof and concentrate their efforts on target areas in the ghettos and rural depressed areas. However, administering the incoherent jumble of programs within the limits of their varying guidelines and procedures has so far proven no easier than administering them separately. The situation is improving but still demands consolidation and rationalization along functional rather than program lines. Until Congress takes on this restructuring, federal and local administrators can only make the best of a bad situation. It is interesting to note that, while the Commission recommended consolidation of existing programs, it praised the emergence of two new instrumentalities at the national and community levels, the Urban Coalition and the National Alliance of Businessmen, and recommended creation of a third.

Existing programs are basically of two types:

(1) Those providing basic education and skill training to prepare the unemployed to compete more effectively for existing jobs: and (2) Those providing income through work relief misnamed as work experience. Absence of any rec ommendation by the Kerner Commission to expand the first category is undoubtedly a consequence of its emphasis on assisting the “hard core unemployed” who, it was assumed, could not be reached or motivated by these means. There seems to be no a priori justification for this choice. Those unemployed the longest or most alienated from the system may be the most difficult to train and the hardest to interest in training. It is undoubtedly true that they are likely to be more easily motivated by immediate receipt of a paycheck from a private or public employer but, for them particularly, remedial basic education and training, whether given on the job or off, will be necessary before they can successfully compete.

However, the Commission's own report describes the typical rioter as having more education than his neighbors and being employed but in a menial job. If it is true that the frustrations festering in the ghettos are generated by the lack of opportunities to rise within them or emerge from them, these pressures are likely to be cooled as much by assisting those just below the margin of successful employment. Employers who can be “bribed" to hire those they would otherwise ignore might be as much enticed by the availability of a well-trained employee. Situations vary widely by location. In some ghettos few jobs exist and city size and transportation inadequacies make access difficult. In others, jobs are within reach and the primary problem is to make the potential employee attractive.

Skill Centers established under the Manpower Development and Training Act in the inner cities have had a good record of enrolling ghetto residents, providing them with basic education and skills and seeing them on to regular employment. The facilities, established with federal funds, are currently operating at about half capacity due to the lack of funds. Enrollments in institutional skill training are falling while increasing funds are being allocated to subsidizing the private employment of the "hard core." While the latter should be tried, it is not clear that it is preferable to the former. How many could be brought into successful employment by training alone is as uncertain as the number who can best be helped by subsidized employment. It is clear that the facilities, instructors and trainees are available to at least double present training efforts. The preferred mix of manpower services differs by community but in most there are many jobs fillable on the basis of training alone.

Opening access to jobs

The need to remove artificial barriers to jobs requires no comment though the means of doing so does. The announcement of public policy inherent in the various anti-discriminatory laws and regulations has made a considerable dif- · ference even though enforcement may have had limited impact. Overt, deliberate discrimination is declining but numerous institutionalized barriers remain. Federal, state and local governments are often the worst offenders. Efforts of such organizations as the Worker's Defense League which simultaneously work with employers to lower barriers and employees to surmount them have met considerable success. It is difficult to understand the Riot Commission's inclusion of recommendations for a higher minimum wage in a section entitled “opening the existing job structure."

Jobs in the public sector

The proposal that the federal government should act as "employer of last resort" has been endorsed by every major national commission exploring any related topic since it was first made by the National Commission on Technology, Automation and Economic Progress in 1966. The proposal was not made in isolation as a single panacea but was designed to be the floor under a ladder of various opportunities. Expansion of total employment by increasing aggregate demand was highest on the list followed by remedial education, training, mobility assistance and improved labor market services to improve the efficiency of the labor market and enhance the ability of the unemployed and underemployed to compete for available jobs. The last resort was to supply useful but noncompetitive jobs in public service tailored to the abilities of those left over when inflationary pressures had exhausted the economy's ability to produce more competitve jobs, private or public. It was to be the last resort for the individual and public policy but was to be accompanied by education and training opportunities to provide a way out for those with the potential ability to progress upward from the basic job guarantee.

Because the immediate reaction to the proposal has been frequently to recoil in horror and cry "WPA," I have dredged up a long forgotten table to support my contention that the New Deal work relief programs were, in the context of the times, some of the most productive public investments we have ever made in this country (see table 2). It is worth noting that in 1939, 6.6 percent of the labor force and 2.8 percent of the Gross National Product were involved in such programs compared to perhaps five-tenths of one percent of the labor force and one-tenth of one percent of the GNP today.

Source: U.S. Federal Works Agency, "Final Report on the WPA Program," 1935-43 (Washington, D.C., U.S. Government Printing Office, 1947), pp. 131-32.

Related experience is currently being gained in the Neighborhood Youth Corps, Work Experience and Training, Job Corps Conservation Center, Operation Mainstream and New Careers programs. Unfortunately, current efforts have not attained New Deal quality, despite the criticisms of the earlier period. The fact that reports are available on the hours worked and the physical accomplishments of the earlier period while neither are currently known on any current program is an indication of the problem. There has been little attention paid at the federal level to the degree to which productive use is made of the "free" labor by project sponsors. The victims are the value of both the work experience and the public services and facilities which could be produced.

The New Careers is the most intriguing of current work programs, though too new for evaluation. Its purpose is to move the unemployed and underemployed up through restructured subprofessional jobs into useful and satisfying public service careers. Experience to date indicates its potential as a second chance

for those with ability who lack preparation. It is unlikely to ever be a large scale job creation program.

The primary advantage of the public service employment approach is that it creates jobs, whereas neither training nor subsidized private employment are likely to have significant job creating effects.

The Neighborhood Youth Corps provides the best model for a program to guarantee public service employment opportunities, if only its administrators will become as concerned about the productivity of the labor it subsidizes and the extent of basic education and training opportunities provided as they are about income into the hands of enrollees. The federal agency requests proposals from federal, state, local and private nonprofit sponsors who should be required to demonstrate ability to use the labor for useful public service purposes, while building in upward mobility opportunities for the potentially able and maintaining a sheltered environment for those who can never be expected to complete. With that assurance, projects can be funded, monitored and carefully evaluated as a prerequisite to refunding.

Conceiving of useful work to be done by participants in a public service employment program is not difficult, but overcoming opposition of interest groups and administering projects might be. There are few, if any, alternatives to publicly sponsored employment for immobile rural adults with inadequate education. Hard physical work still has dignity in these areas and there is plenty of useful work in conservation and related activities to be done. Since the incidence of broken families is less, the clientele would be primarily male. The always deficient education and health systems could, with minimal training, offer outlets for women as well. A guarantee of rural employment would slow outmigration to urban areas, which might ease their current problems.

The situation in the urban slums is much more complex. Housing discrimination and transportation deficiencies limit the access of slum residents. Personal limitations such as inadequate education and training, police records, low motivation, or family burdens tend to block them from the most rapidly growing urban job. Vested interests control many of the jobs for which slum residents might qualify. Self-esteem appears to be more threatened by low wages and distasteful tasks than by idleness and dependency.

Remedial education and training, transportation improvements, industrial development efforts, and open housing in the suburbs could reduce the need for publicly supported jobs. Absent those, subprofessionalization in the poverty program, education, health, welfare, crime control and community development offer a demonstrated potential for the most able and motivated. Since the employers are hardpressed public agencies, professional reluctance can be overcome by availability of funds, political leverage, and assistance in restructuring jobs. Job needs for women will far exceed the supply of potential subprofessional openings. The better prepared males can also work as subprofessional aides of various kinds but the opportunities are limited. Vast opportunities exist in slum rehabilitation but tapping them will require funds, the overcoming of resistance from institutions with a vested interest in such work and the development of methods to utilize low-skilled labor.

The force account approach to construction of public facilities, typical of the WPA, is probably not feasible politically in the current situation. Only with major portions of the labor force unemployed could the demand for jobs overcome the opposition of those with vested interest in employment in the industries affected. It is lower skilled public service jobs which must provide the major source of employment to unemployed adult male residents of urban slums. Local and state governments and more particularly the federal civil service have been guilty of insisting on unrealistically high eligibility requirements for low-skilled, nonsensitive jobs. These governments are more likely than private employers to demand high school education and clean police records even when both are irrelevant to the job.

A final employment source of almost unlimited potential is the expansion of public employment to those activities which would pay if labor were free, assuming the employment of the idle, the dependent and the lowly paid to be an objective equal to the value of the wages paid. Two mails a day in residential areas has been suggested. The number of unskilled but useful tasks in cleaning, repairing, and refurbishing public buildings, streets, parks, and neighborhoods is without limit, though it may be difficult to avoid the stigma of make work. The costs of such a program are a simple function of the numbers involved,

the wages paid and the overhead costs. The federal minimum wage is an obvious floor. In fact an attractive aspect of a universal public employment guarantee would be elimination of minimum wage administration. However, the national minimum wage is inadequate to provide motivation in high wage communities and some proportion of average wages is probably preferable. A public service employment program would be made more attractive by availability of a hierarchy of jobs at higher pay. However, if properly combined with education and training and with other public jobs and if effectively administered, regular public employment, in addition to private opportunities, could provide the needed upward mobility. Then only the entry level jobs, plus the supervisory positions attached to them would require subsidization and the minimum wage plus overhead would become the cost.

Finding useful tasks to employ in the public service all the Congress will appropriate funds to employ is no overwhelming challenge. Getting effective administration of such a program might be more difficult.

Jobs in the private sector

Jobs for the disadvantaged in the private sector is the current emphasis in federal manpower policy. Since there is as yet no experience to evaluate, one can only speculate about the potential contributions and problems. Ostensibly, obstacles to employing the "hard core" are removed by reimbursement of the costs of training the inadequately skilled on-the-job to make them equal to alternatively available employees. Actualy little meaningful training occurs in industry at entry levels. Though some of the payments to employers under current programs such as JOBS may be used to purchase basic education and classroom training from educational institutions, it is most useful to view the payment as a subsidy designed to purchase a job. If well handled, the payment will be just sufficient to offset the employers reluctance to hire the client in preference to the most attractive candidate the employer could have hired, Subsidized employment of the disadvantaged faces the same basic handicap as training programs: it does not create jobs; at best it only effects who gets them. A subsidy paid to a private employer for hiring a disadvantaged person may, if high enough, attract expansion for the subsidy's sake as opposed to the production's sake. This is unlikely, however. It is more reasonable to assume that the employer employs the client in lieu of someone else he would have hired in absence of the subsidy.

The chief practical difficulty is assuring that the employee hired is significantly more disadvantaged than the alternative. The MDT On-the-Job Training program fell into disrepute for just this reason. As pressure was applied to expand MDT-OJT, the demographic characteristics of the enrollees shifted away from the minority groups, poorly educated and the young and old who were considered the disadvantaged targets. The hope of the current efforts is that payments of $3500 to $5000 per head rather than the previous average of around $500 can overcome the obstacle of employer reluctance. The basic problem remains, however. To be a member of a minority group or less than a high school graduate or under 22 or over 44 years of age is not prima facie evidence of job market disadvantage. Higher proportions of these groups than others appear to face competitive handicaps but the majority in each group still do reasonably well. "Disadvantage" is not an absolute condition but a position along a continuum. It is difficult to establish criteria which does not open the possibility of "creaming" within each group. This, in addition to the fact that success with 500,000 actually "hard core" unemployed over 31⁄2 years would make a hardly noticeable dent in the universe of need, poses some difficulties for the JOBS program and the subsidized employment approach.

As long as the result is to bring jobs into a ghetto where the employer would not have recruited, who gets the job may not be of great importance. Building a "climate of opportunity" in such places may be the best long-run insurance against frustration and rioting. The most important consideration is that of opportunity costs. A dollar spent on subsidizing private employment cannot be spent on basic education, training or some other alternative. If the employer fails to hire people significantly different in either ability or location than those he would otherwise have hired, social welfare is not enhanced. If he does, the question is only, "Did this expenditure accomplish more per dollar than other alternatives?" The answer will depend on time, location and conditions. Subsidized private employment is an attractive component of a total kit of remedial manpower tools but is not necessarily preferable to others.

Since the Riot Commission endorsed tax incentives as the preferred route to private employer involvement, some comment on that recommendation is necessary. The notion is attractive to businessmen because they expect it to be without controls or "red tape." The expectation is unrealistic. The objective is not to encourage training in general but the employment and training of the disadvantaged in particular. No less "red tape", reporting, monitoring and evalution would be necessary to assure that members of appropriate target groups are enrolled and properly trained under tax incentives than under direct contract or reimbursement measures. As already noted, assuring pursuit of social goals is difficult enough under the more direct approach. Tax incentive devices to bring jobs to the ghettos and depressed areas to create a climate of opportunity there are a different matter. The location rather than the client is the relevant factor and less monitoring is required. As the Riot Commission report rightly points out, there are essentially two long-run approaches to "cooling" the frustrations underlying the riots-"gilding the ghetto" and disperising ghetto population. The first will require bringing jobs to where the people are. Rebuilding the ghettos are most likely to provide jobs to ghetto residents if contractors are of the same race. Negro and other minority group entrepreneurship in this and other small scale industries is vitally important to a climate of opportunity. Dispersion will require not only open housing but low cost and subsidized housing but, accompanied by remedial education and training, would be the best long-run solution.

SUMMARY

The employment recommendations of the National Advisory Commission on Civil Disorders are generally admirable ones. They are deficient in giving too little credence to remedial basic education and skill training. They are somewhat unrealistic on tax credit. Their estimate of the public service and subsidized private job needs are none too large. Both proposals have merit and should be pursued along with expansion of remedial education and training. To have publicly created Skill Centers operating at half capacity for lack of a few dollars in the very inner cities where the needs for them are greatest is less than rational. Any assumption that lack of jobs is a primary cause of rioting in the short run and that providing jobs will be an effective short run deterrent is probably an over-simplification. Riots are more likely attributable to a complex climate of frustration in which quality as well as quantity of jobs are important but so are many other factors. Potential violence simmers below the surface of most any society but it is held in check by the commitment of the majority to law and order. The immediate participants in a riot and looting may be the idle, the greedy, the angry or just kids on a lark. The key question is, "why have the more stable elements withheld their constraints?"

Probably more important than the immediate availability of jobs is the presence of a total climate of opportunity, including jobs, which create a vested interest in orderly human relations. Immediate riot control, then, is not the dangling of jobs like rewards to good children. Probably nothing but effective "restrained but firm" police action can meet the current challenge in the short run. Longer run solutions involve education, training, housing, mutual respect and jobs. If access to opportunity is guaranteed, motivation should flow from the experiences of those who demonstrate the possibility of finding success within the system.

Chairman PROXMIRE. Thank you, sir.
Mr. Saltzman?

STATEMENT OF ARTHUR W. SALTZMAN, MANAGER OF THE EDUCATION AND TRAINING DEPARTMENT, FORD MOTOR CO.

Mr. SALTZMAN. My remarks may sound a little bit like footnotes to Mr. Mangum's paper. Accordingly, I will edit my prepared statement as I go along.

My name is Arthur Saltzman. I am manager of the education and training department, personnel and organization staff, Ford Motor Co., Dearborn, Mich. For 13 months beginning in October, 1965, I