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to double the waste treatment construction grant program then in operationand in 1961 President Kennedy signed such an act into law.

able and distinguished Senator from Maine [Mr. MUSKIE] will take my bill into consideration as he prepares for the next step in the battle to make our Na

Last spring I suggested to the Depart-tion's water clean. There is no doubt in ment of Health, Education, and Welfare my mind that the United States owes a that Connecticut would be an ideal debt of gratitude to the junior Senator State in which to develop a meaningful from Maine. He has fought long and pollution control program to serve as hard for clean water, and his dedication a model for the rest of the Nation. to this cause has meaning for the entire Highly industrialized, with a concen- Nation. trated population drawing on a fixed water supply, with both salt and fresh water pollution problems, Connecticut has within its boundaries a microcosm of all the Nation's pollution control headaches.

The response of the Department of Health, Education, and Welfare was encouraging. Under the Hudson-Champlain metropolitan coastal comprehensive water pollution control project which began this year, the Housatonic River and Connecticut's Hudson River tributaries are being studied now. Next year, the New England drainage basins project will be started-and encompass the remaining waters in Connecticut. These projects will lay the groundwork and provide the study leading to the development of a model water quality management program. Under the leadership

I believe that my bill represents a realistic assessment of a national need. Clean water is no luxury-it is essential to our Nation's future. The sooner we realize that fact, the sooner we will conquer the problem.

But municipal waste treatment facilities are not alone the answer. They are needed they must be built--and the funds to build them must be provided.

to insure that industry does its part in the fight for clean water?

I say we cannot do less.

We are the stewards of the Nation's resources. We have the responsibility to insure that future generations can enjoy what their forefathers possessed-and what we have come so perilously close to destroying forever.

The PRESIDING OFFICER. The bill will be received and appropriately referred.

The bill (S. 2481) to amend the Federal Water Pollution Control Act, as amended, to increase the share of Federal financial assistance for construction of municipal sewage treatment works and to authorize increased appropriations for the purpose of making such grants, and for other purposes, introduced by Mr. RIBICOFF, was received, read twice by its title, and referred to the Committee on Public Works.

Conquering pollution will be a gigantic undertaking, requiring the cooperation of every level of government and the best efforts of industry. We cannot merely point the finger of scorn at in- FOOD AND AGRICULTURE ACT OF dustry and say "Do something about pollution." We must squarely face the fact that pollution control is expensive-and that industries make economic judgments, not esthetic ones.

I believe industry has come to realize

1965-AMENDMENT

AMENDMENT NO. 428

Mr. CARLSON. Mr. President, I sub

mit an amendment, intended to be proposed by me to the bill (H.R. 9811) to maintain farm income, to stabilize

of Gov. John Dempsey, Connecticut is the good sense-and the utter necessity prices and assure adequate supplies of already taking important steps to clean

up the pollution in its rivers. We have begun. We shall have a study. And we are building the foundation for an action program.

But although we need further study and although we need to do further research on advanced pollution control techniques, this is also the time for action. We know a great deal about controlling pollution now. The question is: Are we willing to spend the money to do it?

If we are to save what water we have left, we have no choice. If we are to prevent further despoiling of our precious water resources, we must act now. As a nation, we can afford the costand I believe the Federal Government must, of necessity, contribute a significant portion to the effort.

I, therefore, introduce, for appropriate reference, a bill to amend the Federal Water Pollution Control Act. My bill would quadruple the current Federal effort in this area-increasing from $100 million to $400 million the annual Federal contribution to State and local waste treatment plant construction programs. In addition, the bill would increase the maximum grant allowed each community from 30 percent of the cost of the project to 50 percent and remove all maximum dollar limitations now in the law.

Under my bill Connecticut could receive $5,285,200-as opposed to the $1,321,300 allocation under the present law. By State and local matching of the Federal contribution we will double these amounts. And as a nation we will be able to maintain the $800 million annual effort needed to bring our communities' treatment facilities up to date.

Mr. President, my bill represents what I believe we must do to solve our pollution problems. I would hope that the I would hope that the

of assuring clean water. But substan

tial outlays of capital for pollution control devices do not bring additional profits. In fact, if some firms within an industry install equipment while others

do not, those willing to shoulder an economic burden for the good of the community may find themselves at a competitive disadvantage within their industry.

We must also recognize that there is a limit to the effectiveness of the demand by a State: "Clean up or else." The "or else" may well turn out to be a decision by an industry to move to another State-where controls are either unnecessary or not required.

The ultimate solution to the problem of industrial pollution must lie somewhere between the two extremes. We can fairly demand that industry clean up its pollution only if we extend a reasonable and equitable means of doing so.

I have proposed legislation to give the necessary economic incentives to industry in S. 1670. try in S. 1670. That bill would permit taxpayers who buy treatment equipment to deduct its cost over 36 months rather than the entire useful life of the equipment.

I understand that the administration has had the use of economic incentives for pollution control under consideration since last February. In fact, the President ordered that such a study be made in his message on natural beauty. Despite the President's obvious interest in this area, the Council of Economic Advisers has not come to grips with the problem. It has procrastinated and delayed. I recognize that it is never comfortable to grasp the nettle-but grasp it we must, if we are to solve the problem of pollution.

The time for a decision is long overdue. Can we afford as a nation an additional $50 to $150 million in tax relief

agricultural commodities, to reduce surpluses, lower Government costs and promote foreign trade, to afford greater economic opportunity in rural areas, and amendment be printed and lie on the for other purposes. I ask that the table until the Senate considers the bill.

permit a man and wife who owned and This amendment, if adopted, would

their marriage to operate the previously operated land individually previous to owned land independently after marriage under the farm program.

The PRESIDING OFFICER. The

amendment will be received and printed, as requested by the Senator from Kansas.

NOTICE OF PUBLIC HEARING ON THE NOMINATION OF LAWRENCE FRANCIS O'BRIEN, OF MASSACHUSETTS, TO BE POSTMASTER GENERAL

Mr. MONRONEY. Mr. President, as chairman of the Committee on Post Office and Civil Service, I wish to announce that the committee will hold a public hearing on the nomination of Mr. Lawrence Francis O'Brien, of Massachusetts, to be Postmaster General, at 10 a.m., Wednesday, September 1, 1965, in room 6202, New Senate Office Building.

Anyone wishing to testify on this nomination may arrange to do so by calling the committee staff, 225–5451.

NOTICE OF RECEIPT OF NOMINA

TION BY COMMITTEE ON FOREIGN RELATIONS

Mr. FULBRIGHT. Mr. President, as chairman of the Committee on Foreign Relations, I desire to announce that yesterday the Senate received the nomination of John A. Gronouski, of Wisconsin, to be Ambassador Extraordinary and

Plenipotentiary of the United States of eign Relations Committee, Senator FUL- myself and that it demeans the process America to Poland. of honest debate in the Senate on problems of foreign policy.

In accordance with the committee rule, this pending nomination may not be considered prior to the expiration of 6 days of its receipt in the Senate.

NOTICE OF HEARING ON NOMINATION OF SIDNEY O. SMITH, JR., OF GEORGIA, TO BE U.S. DISTRICT JUDGE, NORTHERN DISTRICT OF GEORGIA

Mr. EASTLAND. Mr. President, on behalf of the Committee on the Judiciary, I desire to give notice that a public

hearing has been scheduled for Wednesday, September 8, 1965, at 10:30 a.m., in room 2228, New Senate Office Building, on the nomination of Sidney O. Smith,

Jr., of Georgia, to be U.S. district judge, northern district of Georgia, vice Wil

liam Boyd Sloan, retired.

At the indicated time and place persons interested in the hearing may make such representations as may be pertinent.

The subcommittee consists of the Sen

ator from North Carolina [Mr. ERVIN], the Senator from Nebraska [Mr. HRUSKA], and myself, chairman.

NOTICE CONCERNING NOMINATIONS BEFORE COMMITTEE ON

THE JUDICIARY

Mr. EASTLAND. Mr. President, the following nominations have been referred to and are now pending before the Committee on the Judiciary:

George M. Stuart, of Alabama, to be U.S. marshal, southern district of Alabama, for a term of 4 years, reappoint

ment;

Richard E. Eagleton, of Illinois, to be U.S. attorney, southern district of Illinois, for a term of 4 years, vice Edward R. Phelps, term expired; and

David G. Bress, of the District of Columbia, to be U.S. attorney for the District of Columbia for a term of 4 years, vice David C. Acheson.

On behalf of the Committee on the Judiciary, notice is hereby given to all persons interested in these nominations to file with the committee, in writing, on or before Tuesday, September 7, 1965, any representations or objections they may wish to present concerning the above nominations, with a further statement whether it is their intention to appear at any hearing which may be

scheduled.

BRIGHT, and myself.

It was even implied that last week's exchange between the chairman and myself on the question of the Dominican Republic was simply another manifestation of this so-called feud rather than an honest expression of opposing viewpoints.

I know that talk of a feud between two Senators makes interesting newspaper copy.

But, if it will help at all, I want to assure my friends of the press that there chairman of the Foreign Relations Comnever has been any feud between the mittee and myself, and there is none

today.

I have the greatest respect, indeed, for the Senator from Arkansas whom I regard as one of the ablest and most original thinkers in the Senate in the sphere of foreign policy.

Our relationship in the committee has been a most cordial one; and I believe the record will show that I have voted alongside the committee chairman far more frequently than I have taken issue with him.

The chairman of the committee enjoys a deserved reputation as a man who says what he thinks, and he has never hesitated to espouse a viewpoint simply because it was unpopular. I hope the press will accord me the courtesy of believing that I, too, am governed by the dictates of conscience when I take stands that may be controversial.

That the chairman and I should have differences on certain aspects of foreign policy is only natural and proper; and if we sometimes voice these differences on the floor of the Senate, I believe that in some contribution to the process of pubdoing so we have, on both sides, made lic debate.

I am certain that the Senator from Arkansas has never taken issue with me for purely personal reasons or because of any so-called feud; and I am equally certain in my own mind that, if I have sometimes taken issue with the chairman of the Foreign Relations Committee, my remarks have stemmed from honest conviction rather than from any imaginary personal animus.

In the heat of debate, in the Senate or anywhere else, harsh words are sometimes exchanged. This is regrettable. However, the great majority of harsh words exchanged in the course of debate are not the product of personal ill-feeling, but are, instead, a manifestation of

a weakness which afflicts most human be

COMMITTEE MEETING DURING THE ings who are active in debate and public

SENATE SESSION

On request by Mr. HART, and by unanimous consent, the Committee on Finance was authorized to meet during the session of the Senate today.

ALLEGED FEUD IN FOREIGN RELA

TIONS COMMITTEE

Mr. DODD. Mr. President, over the past several days, a number of items have appeared in the press suggesting that there is some kind of feud between the distinguished chairman of the For

discussion.

I know this is so, because I have been an advocate most of my life. I understand as well as any man how regrettable statements can sometimes be generated by heated debate, and I have myself, unfortunately, been guilty of such mistakes on occasion.

I, therefore, wish to request of the Senate press corps that they examine our statements, both past and future, on their objective merits, rather than speculating about personal motives.

I feel that such speculation does injustice to the committee chairman and

Mr. FULBRIGHT. Mr. President, I appreciate what the Senator from Connecticut has said. As he has correctly stated, on the great majority of the issues before our committee, we are in agreement. He has given me his proxy on numerous occasions. Occasionally there occurs a difference of point of view; and both of us may be inclined to overstate our personal point of view. But that has nothing to do with our personal feelings.

I reciprocate what the Senator has

said. I have the highest regard for

him as a Senator and as a member of the Foreign Relations Committee. I regret that the press tends to interpret these differences as a personal feud. I appreciate what the Senator has just

said.

Mr. DODD. I am deeply grateful to my chairman.

Mr. MANSFIELD. Mr. President, I have listened with great interest to the colloquy between the Senator from Connecticut [Mr. DODD] and the Senator from Arkansas [Mr. FULBRIGHT].

I do not believe it was necessary for them to set the record straight so far as their colleagues are concerned, because if the time comes when a Senator cannot express what he is individually thinking, or exercise initiative or responsibility, it will be a sad day for the Senate.

Nonetheless, I am delighted that these two outstanding Members of this body went as far as they did in making this statement, though, I repeat, it was not at all necessary so far as their colleagues are concerned.

Mr. DODD. I am deeply grateful, Mr. President, to the majority leader. He is a kind and generous friend, and I appreciate his kind remarks about me and the chairman of the Foreign Relations Com

mittee.

EXECUTIVE SESSION

move that the Senate proceed to consider Mr. MANSFIELD. Mr. President, I executive business to consider two nominations just reported from the Committee on the Judiciary.

The VICE PRESIDENT. The question is on agreeing to the motion of the Senator from Montana.

The motion was agreed to, and the Senate proceeded to the consideration of executive business.

The VICE PRESIDENT. If there be

no further reports of committees, the

clerk will state the nominations.

U.S. COURT OF APPEALS The legislative clerk read the nomination of Edward M. McEntee, of Rhode Island, to be U.S. circuit judge, first circuit.

The VICE PRESIDENT. Without objection, the nomination is confirmed.

U.S. DISTRICT COURT The legislative clerk read the nomination of William O. Mehrtens, of Florida,

to be U.S. district judge for the southern section 1 of this Act which permits the teledistrict of Florida.

The VICE PRESIDENT. Without objection, the nomination is confirmed. Mr. MANSFIELD. Mr. President, I Mr. President, I ask unanimous consent that the President be immediately notified of the confirmation of these nominations.

The VICE PRESIDENT. Without objection, the President will be notified forthwith.

LEGISLATIVE SESSION

On request by Mr. MANSFIELD, and by unanimous consent, the Senate resumed the consideration of legislative business.

APPLICATION OF THE ANTITRUST
LAWS AND THE FEDERAL TRADE
COMMISSION ACT TO ORGANIZED
PROFESSIONAL TEAM SPORTS
Mr. MANSFIELD. Mr. President, I
ask unanimous consent that the Senate
proceed to the consideration of Calendar
No. 446, Senate bill 950.

The VICE PRESIDENT. The bill will be stated by title for the information of the Senate.

The LEGISLATIVE CLERK. A bill (S. 950) to make the antitrust laws and the Federal Trade Commission Act applicable to the organized professional team sports of baseball, football, basketball, and hockey and to limit the applicability of such laws so as to exempt certain aspects of the organized professional sports of baseball, football, basketball, and hockey, and for other purposes.

The VICE PRESIDENT. Is there objection to the present consideration of the bill?

There being no objection, the Senate proceeded to consider the bill, which had been reported from the Committee on the Judiciary, with amendments, on page 1, line 3, after the word "That,", to insert "(a) except as otherwise prɔvided by subsection (b),"; on page 2, after line 17, to insert a new subparagraph, as follows:

(b) The exemption conferred by subsection (a) shall not apply to any agreement, plan, or arrangement under which any club administering a professional sport team may have an exclusive or preferred right to negotiate for the services of any college student if such agreement, plan, or arrangement would permit such club to enter into a professional athletic contract with any student who has matriculated, at a fouryear college granting degrees, before the earlier of the following dates: (1) the date of the conclusion of the fourth academic

year following his matriculation, or (2) the date of the conclusion, during the fourth academic year following his matriculation, at the college at which he first matriculated, of the scheduled intercollegiate season of the professional sport to which he has been signed.

And, on page 3, line 24, after "Sec. 6.", to strike out "Nothing in this Act shall be deemed to amend or otherwise affect the Act of September 30, 1961 (75 Stat. 732)." and insert:

Section 3 of the Act of September 30, 1961 (75 Stat. 732), is amended to read as follows:

"SEC. 3. Section 1 of this Act shall not apply to any joint agreement described in

casting of all or a substantial part of any professional football game on any Friday after 6 o'clock post meridian or on any Saturday during the period beginning on the second Friday in September and ending on the second Saturday in December in any year from any telecasting station located within seventy-five miles of the game site of any intercollegiate or interscholastic football contest scheduled to be played on

such a date if

"(1) such intercollegiate football contest is between institutions of higher learning, both of which confer degrees upon students following completion of sufficient credit hours to equal a four-year course, or

are

"(2) in the case of an interscholastic football contest, such contest is between secondary schools, both of which accredited or certified under the laws of the State or States in which they are situated and offer courses continuing through the twelfth grade of the standard school curriculum, or the equivalent, and

"(3) such intercollegiate or interscholastic football contest and such game site were announced through publication in a daily newspaper of general circulation prior to March 1 of such year as being regularly scheduled for such day and place."

So as to make the bill read:

S. 950

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That, (a) except as otherwise provided by subsection (b), the Act of July 2, 1890, as amended (26 Stat. 209); the Act of October 15, 1914, as amended (38 Stat. 730); and the Federal Trade Commission Act, as amended (38 Stat. 717), shall be applicable according to their terms to the organized professional team sports of baseball, football, basketball, and hockey, except that neither such Act shall apply to any contract, agreement, rule, course of conduct, or other activity by, between, or among persons conducting, engaging, or participating in any one of the organized professional team sports of baseball, football, basketball, or hockey to the extent to which such contract, agreement, rule, course of conduct, or activity relates to

(1) the equalization of competitive play

ing strengths;

(2) the employment, selection, or eligibility of players, or the reservation, selection, or assignment of player contracts;

(3) the right to operate within specific geographic areas; or

(4) the preservation of public confidence in the honesty in sports contests.

(b) The exemption conferred by subsecplan, or arrangement under which any club tion (a) shall not apply to any agreement, administering a professional sport team may have an exclusive or preferred right to negotiate for the services of any college student if such agreement, plan, or arrangement would permit such club to enter into a professional athletic contract with any student who has matriculated, at a four-year college granting degrees, before the earlier of the following dates: (1) the date of the conclusion of the fourth academic year following his matriculation, or (2) the date of the conclusion, during the fourth academic year following his matriculation, at the college at which he first matriculated, of the scheduled intercollegiate season of the professional sport to which he has been signed.

any individual, partnership, corporation, or SEC. 2. As used in this Act, "persons" means unincorporated association or any combina

tion or association thereof.

SEC. 3. Nothing in this Act shall affect any cause of action commenced prior to the effective date hereof in respect to the organized professional team sports of baseball, football, basketball, or hockey.

SEC. 4. Nothing in this Act shall be construed to deprive any players in the organized professional team sports of baseball, football, basketball, or hockey of any right to bargain collectively, or to engage in other associated activities for their mutual aid or protection.

SEC. 5. Except as provided in section 1 of this Act, nothing contained in this Act shall be deemed to change, determine, or otherwise affect the applicability or nonapplicability of the antitrust laws to the organized professional team sports of baseball, football, basketball, or hockey.

SEC. 6. Section 3 of the Act of September 30, 1961 (75 Stat. 732), is amended to read as follows:

"SEC. 3. Section 1 of this Act shall not apply to any joint agreement described in section 1 of this Act which permits the telecasting of all or a substantial part of any professional football game on any Friday after 6 o'clock post meridian or on any Saturday during the period beginning on the second Friday in September and ending on the second Saturday in December in any year from any telecasting station located within seventy-five miles of the game site of any intercollegiate or interscholastic football contest scheduled to be played on such a date

if

"(1) such intercollegiate football contest is between institutions of higher learning, both of which confer degrees upon students hours to equal a four-year course, or following completion of completion of sufficient credit

"(2) in the case of an interscholastic football contest, such contest is between secondary schools, both of which are accredited or certified under the laws of the State or States in which they are situated and offer courses continuing through the twelfth grade of the standard school curriculum, or the equivalent, and

"(3) such intercollegiate or interscholastic

football contest and such game site were announced through publication in a daily newspaper of general circulation prior to March 1 of such year as being regularly scheduled for such day and place."

Mr. MANSFIELD. Mr. President, it is my understanding that the senior Senator from Indiana [Mr. HARTKE] would like to take the floor for 10 to 15 minutes, if the Chair will recognize him. Mr. JAVITS. Mr. President, will the Senator yield?

Mr. MANSFIELD. I yield to the Senator from New York.

Mr. JAVITS. I, too, would like to talk for about 10 minutes when the Senator from Indiana has finished, and bebusiness. fore the Senate returns to the pending

The VICE PRESIDENT. The Chair will try to accommodate the senior Senator from New York.

The Senator from Indiana is recognized.

PRESERVING WORLD PROSPERITY:

A NEW ROLE FOR THE INTERNA-
TIONAL MONETARY FUND

Mr. HARTKE. Mr. President, I intend today to continue the growing national and international debate over the balance-of-payments position of the of the free world. United States and the financial situation

The signal achievement of United the past 15 years has been the eliminaStates international financial policy in tion of the U.S. balance-of-payments deficit accomplished in the second quarter of this year. For the past 15 years,

with the exception of the Suez crisis year of 1957, the United States has run balance-of-payments deficits on a scale unsustainable by any other nation. For the past 8 years, as least, these balanceof-payments deficits have put the American Government on the defensive in dealing with our foreign short-term creditors. But the firm and prudent policies of the Johnson administration have at last given us the initiative, an initiative commensurate with the unprecedented economic strength and economic prosperity of this country.

Our prosperity today is both great and growing greater. We are enjoying the longest peacetime period of economic expansion in our history-55 months of continuous expansion. And the whole of the industralized world has shared in that prosperity.

There are two fallacies which we must avoid in viewing the future from our present peak of economic well-being. First, we must not adopt the fatalistic assumption that there is a mysterious kind of economic "law of gravity." What goes up-in terms of income, of production, of profits-need not come down.

Second, we must avoid the overoptimism which assumes that prosperity is now our birthright and needs no tending. For, the truth is that the past 42 years of prosperity are the result of careful watching, constant attention, and timely action on the part of the administration. Time and again, under both President Kennedy and President Johnson, our Government has seized the initiative-with liberalized depreciation guidelines and investment credits, with a massive income tax cut and a carefully gaged excise tax cut-in the continuing struggle to maintain our economic impetus. That record of initiative in economic and financial policy and action is, perhaps, the finest achievement of the Johnson administration.

seized the

But threats to our prosperity come not only from within our domestic economy. We are part of a free world economy and our fate is intimately and intricately linked to that of the rest of the free world. And the overriding threat to free world prosperity-and thus to our ownlies in the functioning of the international monetary mechanism which ties together all the interdependent, national segments of that free world economy. It was in the spirit of the Johnson administration's entire approach to economic and financial problems that Treasury Secretary Fowler seized the initiative in calling for an international conference to improve the functioning of the free world's monetary mechanism. And it is in that same spirit that he is in Paris today seeking to transform that initiative into action-with the full backing of the President.

The free world today critically requires American initiative on the whole range of international financial and economic problems. As many wise and informed observers both within and without our Government and both within and without our Nation-have pointed out, that one dynamic factor in international liquidity which has been financing the tremendous growth in world trade has

been the dollars which our payments deficits have been supplying to the rest deficits have been supplying to the rest of the world. The question we must The question we must face the question on which the Senate face-the must be heard-is: What will happen to the growth of world trade and our own continuing prosperity if we cease to supply the rest of the world with those vitally needed dollars?

The threat to world prosperity inherent in the elimination of the U.S. balent in the elimination of the U.S. balance-of-payments deficit is not that there will be a general, uniform, worldwide shortage of dollars with which to finance trade. The threat is, rather, finance trade. The threat is, rather, that one or more vulnerable nations will experience a liquidity squeeze due to the maldistribution of dollars in the free world economy. world economy. And the ultimate danger is that a liquidity squeeze in one country will generate crisis liquidations in others as the threatened nations seek in others as the threatened nations seek to protect their currencies and economies by cashing in their international assets for dollars or gold.

That is precisely what happened in the crisis year of 1931. Then, a French provoked liquidity crisis in Austria, set off a chain reaction of liquidations in Germany, Britain, the United States, and, finally, France herself. The post-World War I monetary system was shattered, War I monetary system was shattered, currencies were universally and destructively devalued, and economic downturns in various nations were transformed into the greatest worldwide economic depresthe greatest worldwide economic depression in history. It is this chain reaction sion in history. It is this chain reaction of liquidation which the U.S. Governof liquidation which the U.S. Government must prevent and certainly, certainly, above all, we must not provoke.

the

Already, Great Britain has been identified as the potential weak link in today's chain of world prosperity and day's chain of world prosperity and liquidity. On August 12, the distinguished Senator from New York [Mr. guished Senator from New York [Mr. JAVITS] made a major contribution to our understanding of understanding of the problems which Great Britain faces, while at the same time he took the lead in proposing same time he took the lead in proposing specific policy initiatives to aid the British Government's vigorous, long-term program of modernization. In spirit of bipartisanship in international affairs, I would like to take this opportunity to associate myself in every way with the perceptive analysis and farreaching recommendations of my distinguished colleage from New York. The six-point program for economic, financial, and political cooperation with Great Britain offered by the senior Senator from New York provides a new and needed point of departure for American policy toward Europe and, indeed, toward the entire free world.

We must not allow the initiative in relations between Europe and America to fall by default to General de Gaulle. We can and must continue to move toward that close and cooperative working relationship with our like-minded allies that has been the cornerstone of our whole international economic policy-from the Bretton Woods Conference of 1944 to the Kennedy round tariff negotiations of today. But there are two prerequisites if we are indeed to achieve that partnership of friendship and alliance which is our goal. First, we must not be deterred by the out

moded economic theories and scantily supported power aspirations of the deflation-minded agents of Economic Gaullism-the central bankers of Continental Europe. And, second, we must beware lest our renewed drive toward a prosperous, growing, and cooperative free world economy be sabotaged by "beggar my neighbor" policies adopted as desperate expedients to preserve markets and currencies from liquidation and depression.

Let us make no mistake about it, in today's interdependent world depression in one country threatens disaster for all others. We are not in an economic depression today-nor is any other industrially developed nation. But the time to preserve prosperity-as the history of the last 41⁄2 years demonstratesis to head off the threat of depression before it becomes actual.

Great Britain is now undergoing the beginnings of a severe economic slowdown. This slowdown has been deliberately and explicitly induced by the British Government to reduce the demand for imports and, thus, to protect the pound. But the result of an economic slowdown in Great Britain is to deprive Britain's basic industrial suppliers-domestic and foreign-of markets. Steel that cannot go to Liverpool from Wales or Hamburg will go to Philadelphia or Detroit or other distressed places, such as New Jersey--and at New Jersey--and at distress prices. Moreover, the $3 billion plus of British assets, both private and official, that are sitting in New York are already being called home to bolster the British economy and the British pound. And pressures are growing on the British Government to match its domestic retrenchment with a pullback from its international responsibilities in the Middle and Far East. The one sure way to guarantee that balance-of-payments equilibrium in the United States will not be maintained is to force Britain to liquidate its dollar holdings, to compel Britain's suppliers to dump in New York or Indiana what they cannot sell in London and to create a strategic vacuum in Malaysia into which U.S. troops-and dollars-must flow.

It is not, therefore, only out of concern for the achievement of our longterm foreign policy aspirations that I speak today. I speak today, as well, out of fear for the jobs of American workers, for the profits of American enterprise, and for the revenues of the American Government. These are the three sources of our economic and financial strength-wages, profits, and tax revenues. All three are threatened by the incipient liquidation of world prosperity that had had its first blossoming in Britain. It may shortly be too late to ask, as all great innovators in history have asked, "what is to be done?"

What is to be done?

First, we must head off the deflationary pressures which Britain's economic slowdown may generate. Presidential exemption of Britain from the interest equalization tax, on the clearly justifiable grounds that the tax's application to Britain threatens international monetary stability, is a step that can and should

be taken at once. Administration encouragement of private American investment in Britain and private business cooperation between the two countries can also be undertaken swiftly. Above all, the determination must be maintained that a stable pound at its present value is as crucial to our interests as it is to Britain's.

But heading off today's crisis will not alone insure that we will have the time to accomplish our long-range goals of international monetary reform and closer free world economic cooperation.

Second, we must make sure that future deflationary trade and financial crises do not arise. In our own interest and in the interest of the free world, we must do our best to guarantee that an end to dollar outflows does not mean an end to trade expansion. The critical need of the world economy today, in the years before fundamental monetary reform can be accomplished, is for internationally acceptable media for the international transfer of goods.

Mr. President, the resolution which I am submitting today on behalf of myself and other Senators is based upon a proposal formulated and presented on July 18 to the International Payments and Exchange Subcommittee of the Joint Economic Committee by the distinguished senior Senator from Minnesota [Mr. MCCARTHY] and myself. The distinguished Senators from Alaska [Mr. BARTLETT], from Utah [Mr. Moss], from Ohio [Mr. YOUNG], from Montana [Mr. METCALF), from Texas [Mr. YARBOROUGH], from Pennsylvania [Mr. CLARK], from Illinois [Mr. DOUGLAS], and from New Jersey [Mr. WILLIAMS] have joined in sponsoring this resolution. Its aim is to fulfill the need of the world economy for an additional increment to the world's an additional increment to the world's money supply-without placing an additional burden on the dollar.

Simply put, our resolution would respectfully request the President to authorize a study of the feasibility of proposing an expansion of the functions of the International Monetary Fund to include the issuing of trade acceptances and credits against shipment of goods in international trade. The mechanism of such an expansion of the International Monetary Fund's authority is quite simple. Gold that would otherwise be purchased from our Treasury to lie sterile in central bank vaults around the world would be deposited in the International Monetary Fund. On the basis of the new gold subscription, the International Monetary Fund would be authorized to issue trade credits up to an internationally negotiated multiple of the amount of gold subscribed. The backing of the credits would be in part the gold subscription and the rest, as with all banker's acceptances, the actual goods whose transfer is being financed.

No discretion would be granted the International Monetary Fund to determine the volume of trade credits outstanding. No question of loss of sovereignty would be involved for any nation. No intervention of the International Monetary Fund in the banking system of any nation would be allowed. The ini

tial allocation of credits would go to participating countries in direct proportion to each nation's gold subscription; each nation's monetary authority would have full discretion to determine what access, if any, to the new addition to the world money supply should be granted to that nation's importers.

I send to the desk a resolution proposing a study of the feasibility of utilizing trade credits issued by the International Monetary Fund to facilitate international trade.

The PRESIDING OFFICER (Mr. WILLIAMS of New Jersey in the chair). The resolution will be received and appropriately referred.

The resolution (S. Res. 142), submitted by Mr. HARTKE (for himself and other Senators) was received and referred to the Committee on Foreign Relations, as follows:

S. RES. 142

Whereas United States prosperity and economic growth depends upon a soundly growing free world economy based, in turn, upon a stable international monetary system;

Whereas the present international monetary system, known as the gold exchange standard, is founded States dollar's role as the number 1 interupon the United national reserve currency and the number 1 medium for the international exchange of goods, services, and capital;

Whereas expanding free world trade and continuing free world prosperity depend upon an adequate and growing supply of international liquidity, of which the United States dollar is a key component;

Whereas chronic United States balance-ofpayments deficits have raised questions with regard to the role of the United States dollar as a stable store of value and medium of exchange and, thereby, have called forth the President's emergency balance-of-payments program which has successfully restrained of-payments surplus in the second quarter the outflow of dollars and produced a balanceof 1965;

Whereas the elimination of the United States balance-of-payments deficit, by removing a critical, annual increment to the free world's supply of liquidity, threatens the continued growth of free world trade and the continued maintenance of free world pros

perity;

Whereas long-term international financial stability requires internationalization of the burden of financing world trade which the dollar and the British pound now bear largely alone; and

Whereas the International Monetary Fund exists as an internationally accepted institution dedicated to the elimination of international monetary disturbances, with the potential for expansion to meet the changing needs of the Free World economy: Now, therefore, be it

Resolved, That the President is respectfully requested to cause an immediate joint study to be undertaken by the appropriate agencies of the Government, including the President's Council of Economic Advisors, the Departernors of the Federal Reserve System, to dement of the Treasury, and the Board of Govtermine the feasibility of proposing the expansion of of the International Monetary Fund's role to include the issuance of trade credits and banker's acceptances to the designated banking institutions of the member nations of the International Monetary Fund

against the shipment of goods in international trade; the supply of such credits to be equal to an internationally determined multiple of an internationally determined subscription of gold to the account of the

International Monetary Fund by the member nations, apportioned according to the recent allocation of quotas.

Mr. HARTKE. Mr. President, the views are many and varied on the likelihood that the threat which I have identiThere fied today will become realities. is even an opinion, common among the heirs of those central bankers of Continental Europe who initiated the last worldwide liquidation and depression, that there is too much liquidity in the world. More common is the outlook that any liquidity squeeze anywhere is sufficiently far in the future to make unnecessary such intiatives as that proposed in the resolution which we have just introduced.

It should be enough, Mr. President, to cite the adage that an ounce of prevention is worth a pound of cure. Last year, the pound of prevention required to save the British pound amounted to more than $3 billion. But I will go further. If those who hold that little or no urgency is required in the effort to overhaul the international monetary system are correct and I do not believe they are-taking out the insurance policies cost us nothing. And such action will, which I have proposed today will still in any case, have positive benefits-including closer cooperation between progressive-minded governments around the world, the first real step toward internationalizing the burden which the dollar bears today almost alone and the first

real demonstration that aid can make trade. If, on the other hand, the critics of urgency prove to be wrong-as I have said I believe they are-but no action has been taken, the consequences will be, in a word, disastrous.

Mr. President, I ask unanimous conuntil the close of business on Friday for sent that the resolution lie on the desk

additional cosponsors.

The PRESIDING OFFICER. Without objection, it is so ordered.

Mr. JAVITS. Mr. President, I compliment my colleague the Senator from Indiana, on the care and attention which he is giving to this very grave problem, which concerns the economic condition of the world.

I agree with him that we should not necessarily have a sharp recession and depression, though some form of correction in a free economy is always necessary. It is our duty to cushion its effect on the individual.

I am strongly for that course of action, with the use of unemployment insurance, social security, manpower retraining, and the many other forms of help which we will make available and are making available to place a concrete base under the economy and to see that no person in this country suffers. However, essentially, if we were wise and able, we could anticipate the swings and materially deal with them so that they would not have the sharp effect that they are always in danger of having.

I believe, laying that aside, that they

are far from perfect now. We face a grave economic situation with respect to the British pound and the British economic situation, which could rock the

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