Mr. WILLIAMS of Delaware. No; he does not say theoretically. These are facts that cannot be ignored.

Mr. YARBOROUGH. Actuarially, yes. If the fund is projected actuarially, as is done by actuaries in insurance companies, what the Senator has said is correct.

Mr. WILLIAMS of Delaware. I suggest that the Senator read again what Mr. Ruddock said. He said that actuarially the deficit of the retirement fund amounts to $40 billion. Our cash balance today is around $19 billion. But without our doing anything about it, this $19 billion will be gone in 20 or 25 years. Either we must increase our contributions or renege on our obligations. That was the testimony of the representative from the Retirement Section of the Civil Service Commission before the Senator's committee.

The

The PRESIDING OFFICER. The OFFICER. time of the Senator has expired.

Mr. WILLIAMS of Delaware. Madam President, I yield myself 5 additional minutes.

I shall ask the Senator to have the bill recommitted so that the widows he is talking about can be taken care of.

It is that part of the bill which deals with the increased benefits for the widows and low-pensioned retirees about which the Senator keeps talking. Let us correct their problem, but let us eliminate from the bill those provisions which guarantee all future retirees, including the Senator and myself, against the ravages of inflation. Let us stop shadowboxing-it is the $10,000 and $15,000 pensions that will reap the bonanza under this bill.

I think we can understand it better if we talk about how it affects the Senator and me, not how it affects some widows.

Mr. YARBOROUGH. I am not willing to limit it to the 535 Members of the Congress, and say that that is any criterion.

Mr. WILLIAMS of Delaware. Perhaps not, but it is the high salaried officials who get the real benefits under this bill. Mr. YARBOROUGH. We are dealing with more 700,000 retirees and widows. It is not a fair criterion to consider only the 535 Members of Congress and say that that is a proper standard. It is infinitesimal. It is minuscule. I am not willing to recommit the bill. These people are hungry; they need bread and milk now, and I think we ought to vote it for them now.

Mr. WILLIAMS of Delaware. Madam President, in order to give bread and milk to those widows on retirement let us face what we are doing for the Cabinet officers and other top executives of government, including the Senator from Texas and the Senator from Delaware. Let us use ourselves as an example.

Last year Congressional salaries were raised 33 percent. There is more that goes with the salary increase than merely a salary increase. The retirement pensions-this statement is true for anyone of the 22 million employees who received salary increases last year-are based on an average of the highest 5 years' salary.

To use our own case as an example our salaries were raised 33% percent which that not only do we draw, beginning this year, an increase 333 percent in salary but also our pensions are increased this year and for the next 5 years 6 percent a year under existing law, resulting in our pensions being increased at the end of 5 years by 333 percent.

In addition, this bill would add to the 333 percent which was indirectly ap33% percent which was indirectly approved last year another increase of 2 percent plus another 62 percent. These additional increases would go into effect immediately, and in the years to come every time the cost of living goes up 3 percent for 3 consecutive consecutive months, whether it occur next year, in 5 years, or in 40 years, there would be another 3 percent increase in our pensions. Yes, this means that we are increasing our pensions by 2 percent and by 62 percent, in addition to guaranteeing ourselves against any future inflation which may result from our spending policies.

I concede that there is some merit in what the Senator is saying about those who are retired on inadequate pensions, but we can help them without adding this additional guarantee for our own benefit. Let us take care of them, but let us not try to get a free ride for ourselves. Every employee in Government from the President on down, would gain an increase under this bill.

Why should the President, the Cabinet officers, the top executives of the numerofficers, the top executives of the numerous agencies and the Members of Congress be entitled to having their pensions guaranteed against any further ravages guaranteed against any further ravages of inflation at the taxpayers' expense when it is the executive branch and the Congress which are responsible for some Congress which are responsible for some of this deficit spending?

Certainly a reasonable argument can be made that if-with the "if" in quotations-if we are to legislate built-in insurance against inflation or an increase in the cost of living for every Government employee, by triggering a 3-percent increase every time the cost of living increases, why should it not work in reverse if the cost of living declines?

Why should we not wait until the first of the year, and get the report of the President's Commission, which report we President's Commission, which report we are going to pay for anyway? Let us get the report, examine it, and arrive at an overall decision as to what we should do and at the same time make arrangements to pay for it.

Mr. YARBOROUGH. We took out section 2 of the bill for that very purpose, to permit the Commission to report and to give Congress an opportunity to study the findings of the committee.

The PRESIDING OFFICER. The time of the Senator has expired.

Mr. YARBOROUGH. I yield myself 1 more minute to answer the Senator's question.

We were considering the fate of the 700,000 annuitants. 700,000 annuitants. Congressional retirement was never considered. I was on the subcommittee. Hearings were held in the absence of the distinguished Senator from Wyoming. I do not remember it being called to our attention by any witness or any other person that the 535 men and women who were in the Con

gress would be singled out for special treatment, out of the 22 million Federal employees.

The purpose was not to try to help ourselves. ourselves. I resent the implication that we were trying to sneak this through as a bill to help the Congress. It was not in my mind, nor, I am sure, in the mind of the distinguished Senator from Kansas [Mr. CARLSON]. There was not a Senator on either side of the aisle who had that thought in mind. That is why the bill was reported unanimously.

As to Senators who attacked the congressional pay increases last year, we are not debating the congressional pay increases of last year. I state frankly, though, that I voted for them with a clear conscience, because I wanted the voters of my State to see that

The

The PRESIDING OFFICER. time of the Senator has expired. Mr. YARBOROUGH. I yield myself 1 more minute.

I wanted the voters of my State to see that I was voting for it. I did not piously vote against the increase in congressional pay, because I felt the increase was fair, and I wanted my constituents to be able to consider my vote, and retire me if they wanted to do so. I voted for it, and my constituents were kind enough to return me to office with the largest majority I ever received.

I am sorry that the distinguished Senator from Delaware felt impelled to go off on something apart from the heart of this bill. I see no merit to his position. With regard to those whom the bill is intended to help, I say with great respect-because I have great respect for the efforts of the Senator in behalf of this country and the Senate fiscal policy that we have the most underpaid

The

The PRESIDING OFFICER. time of the Senator has expired. Mr. YARBOROUGH. I yield myself 3 more minutes.

Among the most underpaid people in this country are the retired people who have worked for the Federal Government.

To think that retirees are well paid is absurd, when there are actual instances of their receiving less than old-age pensions. Testimony before the committee showed that there are many who have to go to the old-age pension boards for money to make up the difference. When the old-age pension investigator comes out, they used to say in my State that the test for the need of assistance was to pass one's hand under a table, to search for discarded chewing gum. If such were found, the report of the investigator would be unfavorable, since chewing gum was considered a luxury, and the old-age pension was designed to cover only the necessities of life. But there are cases in which the people who have given their lives working for the Federal Government are receiving such low retirement pay that they have to get an old-age pension on top of it to hold body and soul together.

This is a modest bill. It ought to pass. It ought to pass now.

I ask unanimous consent that there be printed in the RECORD at this point a let

ter from the Civil Service Commission, dated August 11, 1965, addressed to the senior Senator from Oklahoma [Mr. MONRONEY], and one from the Executive Office of the President, the Office of the Bureau of the Budget, dated August 11,

1965.

There being no objection, the letters were ordered to be printed in the RECORD, as follows:

U.S. CIVIL SERVICE COMMISSION, Washington, D.C. August 11, 1965. Hon. A. S. MIKE MONRONEY, Chairman, Committee on Post Office and Civil Service, U.S. Senate. DEAR MR. CHAIRMAN: This is in response to your request for the official views of the Commission on H.R. 8469, a bill "To provide certain increases in annuities payable from the civil service retirement and disability fund, and for other purposes."

Effective the first day of the third month which begins after enactment, section 1 of H.R. 8469 would provide the following adjustments in existing annuities:

1. All annuities would be increased by the same percentage as the rise in the Consumer Price Index from the annual average of calendar year 1962 to the month latest published on date of enactment. Through June 1965, this rise has been 42 percent. 2. Annuities which began, or survivor annuities deriving from annuities which began, on or before October 1, 1956 would be further increased by 62 percent; annuities which began after October 1, 1956 would be further increased by 12 percent. When combined with the 41⁄2 percent cost-of-living increase, the total increase to each of these annuitant groups would be 11 percent and 6 percent respectively.

3. Annuities of widows and widowers of former employees who died or retired before the survivorship amendments of 1948, which annuities were later awarded as gifts limited to $50 or $63 a month, would be further increased by an amount sufficient to make the total increase equal the lesser of 15 percent or $10 a month.

For the future, annuities would be increased automatically to reflect changes in the cost of living. Such increases would occur whenever the monthly price index showed a rise of at least 3 percent for 3 consecutive months over the base month used for determining the most recent costof-living adjustment.

The bill would make the retirement fund available for the payment of benefits resulting from its enactment, and also for the payment of administrative expenses incurred by the Civil Service Commission in putting into effect the first and all subsequent annuity increases.

Section 2 of H.R. 8469 proposes that the annuities of eligible widows and widowers of employees who die in service or who retire and die after enactment will be 60 percent of the earned annuity or of the survivor base selected by the employee, instead of the 55 percent provided by existing law.

The initial annual cost of the annuity increases proposed by section 1 of H.R. 8469 is estimated to be $101.9 million, with an increase in the unfunded liability of about $1,040 million. Section 2 would increase the normal cost of the system by 0.18 percent of payroll. It would add $817 million to the

unfunded liability, and would incur an an

nual cost of approximately $58 million on the normal cost plus interest basis. The total first-year cost of section 1 and 2 would be $102.4 million, and the unfunded liability would be increased by a total of $1,857

reau of the Budget. In that memorandum he directed a review of the whole structure of our retirement policies, including the patspecifically requested examination of surtern and amounts of benefit payments. He vivor benefits available under the various plans.

The Commission is of the opinion that it would be best to defer retirement legislation until it can be considered in the light of the findings and recommendations which will be included in the Committee report scheduled for completion by December 1, 1965. However, some justification can be found for immediate adjustment of existing annuities. In 1962 the Commission devised and submitted a plan for permanent adjustment of annuities to reflect changes in the cost of living, and that plan with minor revision was enacted as part of Public Law 87-793. Experience to date has shown that the mechanics for adjusting annuities to reflect living costs can be improved and the time element shortened by using the monthly price index instead of an annual average. Accordingly, the Commission will not object to enactment of H.R. 8469 insofar as it proposes adjustment of existing annuities to reflect changes in the cost of living.

We strongly recommend that section 2 be deleted from H.R. 8469. Section 2 is totally unrelated to the adjustment of existing annuities and proposes a major permanent liberalization in the retirement system. The proposal is made without regard to its relationship to other fringe benefits and without any demonstration of a need which would in any way justify its cost. It is the sort of piecemeal approach to retirement legisla

tion which this administration seeks to

check by the formulation of up-to-date policies in the light of the Cabinet Committee's study of the whole Federal retirement structure.

The Bureau of the Budget advises that enactment of H.R. 8469 would be inconsistent with the program of the President if it includes the provisions now in section 2 of the bill.

By direction of the Commission:
Sincerely yours,
JOHN W. MACY, Jr.,
Chairman.

EXECUTIVE OFFICE OF THE PRESIDENT,
BUREAU OF THE BUDGET,
Washington, D.C., August 11, 1965.
Hon A. S. MIKE MONRONEY,
Chairman, Committee on Post Office and
Civil Service,

U.S. Senate, Washington, D.C.

DEAR MR. CHAIRMAN: reference is made to the committee's request for the views of the Bureau of the Budget respecting H.R. 8469, "To provide certain increases in annuities payable from the civil service retirement and disability fund, and for other purposes."

The bill would increase all annuities payable to employees or their survivors who have retired under the Civil Service Retirement Act before the first day of the third month beginning after date of enactment. The annuity increase would be composed of two portions: first, an increase equal to the percentage increase in the Consumer Price Index since 1962 (which was 4.5 percent as of June 1965) plus an increase of either 62 percent for persons whose annuities commenced on or before October 1, 1956, or 12

percent for those whose annuities commenced after that date. Another adjustment is provided for certain pre-1948 survivors who were specially provided coverage under previous amendments. The bill would also revise the 1962 formula for future automatic cost-of-living adjustments in annulties. The Civil Service Commission estimates the first-year cost of these annuity increase provisions to be $101.9 million, and the increase in the unfunded liability of the system to be about $1,040 million.

Section 2 of the bill would increase the

ceiling on the survivor annuity payable on death of an employee or annuitant to 60 percent of the earned annuity, or of the base selected for annuity, instead of the present 55 percent. In a report which the Chairman of the Civil Service Commission is submitting to your committee on this bill, opposed to this provision, he estimates it would increase the normal cost of the system by .18 percent of payroll, adding approximately $85 million to the annual cost on the normal cost-plus-interest basis, and adding $817 million to the unfunded liability. The chairman states that this provision is unrelated to the annuity adjustment problem, has not been demonstrated to meet a need which would justify its cost, and represents the piecemeal approach to retirement liberalization which the President's Cabinet Committee study is designed to prevent. The Bureau of the Budget concurs in the views expressed by the Civil Service Commission.

Accordingly there would be no objection to enactment of H.R. 8469 provided section 2 is deleted, as its enactment would not be consistent with the administration's program. Sincerely yours,

PHILLIP S. HUGHES, Assistant Director for Legisative Reference.

Mr. WILLIAMS of Delaware. Madam President, I did not mean to get the Senator from Texas so excited. I was not singling out Members of Congress. I said this guarantee against inflation applied to the President's pension as well as that of all other executives. I recognize that we are not debating the salary increases of last year. of last year. I repeat-and I do not want to get the Senator excited again because he mentioned heart failure-I certainly do not want any Senator to suffer heart failure on the floor because I describe how Congress benefits under this bill.

Mr. YARBOROUGH. The Senator will get me excited every time he wants to keep these people from receiving a little increase.

Mr. WILLIAMS of Delaware. I gathered that what excited him was my reference to the 535 or so who are Members of Congress, but I will not talk about Congress if that causes the Senator to become so excited. Let us talk about Cabinet officers and other top officials instead, or about any civil service employee. To the extent that any employee receives a salary increase we can divide that percentage increase over the next 5 years and determine the increase in the pension by that amount. If we increase the salary of a Cabinet officer by one-third that is the amount of his pension increase. It is a matter of simple mathematics.

In addition, under this bill another 2 percent is added, and also another 62 percent is added, and then in addition every time the cost of living rises 3 percent for 3 consecutive months another 3 percent will be added.

Under the Great Society's deficit spending inflation is inevitable, but under this bill should we have a further erosion of the dollar, which means an increase in the cost of living, all Government pensions will be increased automatically. So far as the employees of the U.S. Government are concerned, they will be insured against any possible erosion be insured against any possible erosion of their pensions by subsequent inflation. That is something very desirable, of

course, but it is also desirable to the 190 million other Americans; and who pays for this guarantee.

Why should we give Government employees that safeguard at the expense of the other Americans who will not only have to suffer from the inflationary erosion of their own pensions but also have to pay the taxes to finance this program. Senators can talk all they please about widows and orphans—and I sympathize with widows and orphans as much as does anyone else-but we cannot get away from the fact that in taking care of widows and orphans, for whom we are shedding these crocodile tears, we are taking care of ourselves.

If we wish to take care of the widows and orphans let us pass a bill to take care of them. If such a bill is introduced I shall support it. Let us not load the bill down with a guarantee to every official of the Great Society that he personally will not have to suffer from the

inflation he creates.

Mr. Ruddock's statement is that this fund today, on an actuarial basis, will be about $40 billion in deficit. The bill before us adds another $1.054 billion to that deficit. It is also Mr. Ruddock's statement—and he is a very reliable individual-that if Congress does nothing in the next 20 or 25 years and some provision is not made to supplement the income of this fund over and above what is being collected it will be bankrupt in 20 or 25 years.

Of what use is an increase in a pen

sion if the fund is bankrupt?

Those are warning statements of persons who are managing the funds. Those are statements given not to my committee but to the Senator's com

mittee.

I now yield to the Senator from

Kansas.

Mr. CARLSON. Mr. President, I do not wish to become involved in any discussion of salaries and pay increases by my distinguished colleagues from Delaware and Texas. However, I say most respectfully to my good friend from Delaware that his speech in regard to the cost-of-living adjustment annuities should have been made in 1962.

Mr. WILLIAMS of Delaware. I made this same argument in 1962, but I was defeated in my efforts.

Mr. CARLSON. There is no change in the pending bill, H.R. 8649, over the section that is found in Public Law 87793, 87th Congress, H.R. 7927, October 11, 1962, except that the pending bill is on a quarterly basis, when adjustments are made. In the existing law the increases for annuitants are in effect today, but they are on an annual basis. I should like to have the RECORD contain the costof-living adjustment of annuities section, section 18, which is found in the public law which I have cited. It reads: COST-OF-LIVING ADJUSTMENT OF ANNUITIES

SEC. 18. (a) After January 1, 1964, and after each succeeding January 1, the Commission shall determine the per centum change in the price index from the later of 1962 or the year preceding the most recent cost-of-living adjustment to the latest complete year. On the basis of such Commission determination, the following adjustments shall be made:

(1) Effective April 1, 1964, if the change in the price index from 1962 to 1963 shall have

equaled a rise of at least 3 per centum, each annuity payable from the fund which has a commencing date earlier than January 2, 1963, shall be increased by the per centum rise in the price index adjusted to the nearest one-tenth of 1 per centum.

(2) Effective April 1 of any year other than 1964 after the price index change shall have equaled a rise of at least 3 per centum, each annuity payable from the fund which has a commencing date earlier than January 2 of the preceding year shall be increased by the per centum rise in the price index adjusted to the nearest one-tenth of 1 per

centum.

Mr. President, I cannot see any differSenator is making a good argument about ence between the two provisions. The this fund. I have expressed myself on these funds, not only with respect to the present one. All the funds are in difficulty, when we look to the future. We should do something about the situation. The committee discussed it before the bill was reported, and we hope that the Commission appointed by the President will bring in some recommendations.

When they do, I shall support the recommendations. I believe the Commission will do it. However, I say to the Senator that even if we do not pass the pending bill the 3-percent cost-of-living increase is in effect now. If we wish to use the Members of Congress as an example, that is all right, but it affects everyone. That is the law.

Mr. WILLIAMS of Delaware. The

Senator from Kansas is partially correct. However, there is an additional provision in the bill liberalizing the formula. The The existing law triggers it as of January 1 and computes it on a yearly basis. The cost of living may rise 3 percent for a part of the year and then drop back, and there would be no increase under existing law. This bill provides that if for 3 consecutive months-and that could be March, April, and May, or September, October, and November-if the cost of living increases for 3 consecutive months by 3 percent, the automatic increase goes into effect and remains in effect even though the cost of living later declines. The bill also provides an additional 62-percent increase which is an extra bonus.

The bill provides 11 percent for those who retired prior to 1956.

I point out that the Senator from Kansas is partly correct. In my opinion, in 1962 Congress made a mistake, and I so expressed myself then. I lost then. I may lose again today, but at least I want the record clear as to what we are doing.

This bill today provides for an immediate increase that will ultimately cost over $1 billion with no provision contained in the bill to pay for that formula.

If we are to pass these laws let us put a price tag on them. This bill will cost $1,054 million. If Congress decides it is worth paying that amount, why do we not appropriate $1,054 million and put that money into the fund? We should tell the taxpayers the true cost. If the administration is afraid of the taxpayers' revolt over the necessary increase in taxes to pay for these bills then they should not be passed.

If we do not appropriate the money the only alternative is to increase the contributing rates for either the emloyees or the Government, or both.

Mr. CARLSON. It is interesting to note that in the first year following the establishment of the civil service system the Federal Government did not contribute a dollar, which I regret very much. The employees paid their own money into the fund, and for years the only amounts paid back to annuitants were from the money they paid in.

During the past few years the Federal Government has not contributed its

share. The Federal employees continue

to contribute full share.

I am in favor of the Federal Government I suggest an increase in the assessment. I am in favor of the Federal Government

paying.

Mr. WILLIAMS of Delaware. The

Senator from Kansas is correct on that point. Over the years Congress has not appropriated money to enable the Federal Government to include in the budget its proportionate share to finance the fund, but this bill only compounds the failure.

I have supported a pay-as-we-go program. I say again that we are only kidding the taxpayers as to our expenditures when we delay that payment. Why do we not provide for the payment of the $1 billion by appropriating that amount and marking the account

"Paid"?

Shall we go home and tell the retirees

and other people that although we are voting increased pensions we are making no provision to pay for them?

We shall either have to add to the amount that employees contribute to the retirement fund or pay for the cost out of the appropriated funds and thereby have the increase paid by the taxpayer. Somebody has to pay.

When we go home and talk about benefits approved we should have to talk about increased taxes as well. Let those Members voting for these increases also vote for the increased taxes that ultimately will have to be levied to finance the many Great Society extravaganzas.

This bill provides a much more favorable formula that can trigger this increase into effect when the cost of living rises in 3 consecutive months.

But when the cost of living declines by 2 or 3 percent the formula does not apply.

Once the 3-percent increase was triggered, the taxpayers would be hooked for years to come, because not only would the benefits be automatic for those on retirement but they would automatically increase pensions in the years to come.

At the time a particular employee retires the cost of living may even be lower than it is at this moment.

If there is to be a trigger, it should work both ways. Some in the Department feels that it should work both ways. I believe the answer is very simple. Do we want to establish a special provision for employees of the Government whereby we can say: "Do not worry about what Congress does; do not worry about the spendthrift policies of the Great Society because your pension is guaranteed against inflation. If an in

flationary spiral is created in the country and the dollar is devalued, do not worry about it. If you are on a Government pension, the purchasing power of your pension is protected."

Mr. LAUSCHE. The Senator from Delaware just stated, in effect, that we are saying to the Federal employees: "Do not worry about inflation if you are an annuitant at present, because by this law we have taken care of you. Automatically, at the end of every 3 months, if there is a 3 percent rise in the cost of living, there will be given an added 3 percent on retirement pay."

What will become of the millions of other annuitants in this country who are receiving private annuities? What will become of State employees and city employees?

Mr. WILLIAMS of Delaware. And reAnd retirees in the military service along with all on private pensions as well? They will have to make out as best they can. The bill does not protect them or provide any inflationary hedge-only for Federal employees.

Not only does it not protect them but it also provides that in addition to looking out for themselves as best they can they will have to contribute, as taxpayers, to the protection of the Federal employees.

Mr. LAUSCHE. That is, the general annuitant, as distinguished from the Federal retiree, will have to take care of the increased cost of living as best he can. In addition, he will have to contribute to sustain the fund.

Mr. WILLIAMS of Delaware. Yes. As a taxpayer he will have to contribute to sustain this fund so that under this bill we can pay additional cost-of-living increases to all of the 22 million Federal employees.

Mr. LAUSCHE. May I put a few questions to the Senator from Delaware with regard to the present status of the bill?

Mr. WILLIAMS of Delaware. Yes.

Mr. LAUSCHE. My recollection is that 2 years ago the Government owed $35 billion into the fund. Has the amount now reached $40 billion?

Mr. WILLIAMS of Delaware. I was talking with Mr. Andrew E. Ruddock, of the civil service retirement division, a man for whom I have great respect. His estimate is that the deficit in the fund is now about $40 billion. This bill would add another $1 billion to that deficit.

Mr. LAUSCHE. Mr. President, will the Senator from Delaware yield?

The PRESIDING OFFICER (Mr. HARRIS in the chair). Does the Senator from Delaware yield to the Senator from Ohio?

Mr. WILLIAMS of Delaware. I yield. Mr. LAUSCHE. The Senator from Delaware knows about the Foreign Service retirement fund. It protects workers of the Federal Government in the Foreign Service. The Federal Government now owes that fund $284 million. Today, if the Federal Government paid the whole sum of $284 million, in order to keep the fund actuarially sound, it would require a 30-percent contribution from each Foreign Service employee's salary. Therefore, if a Foreign Service

employee is earning $15,000 a year, in employee is earning $15,000 a year, in order to keep the fund sound, $4,500 of his $15,000 would have to be paid into the fund. This would mean that if it were split between the Government and the employee, each would contribute 15 percent. However, it is now proposed that the employee put in 62 percent and the taxpayers the remaining 231⁄2 percent.

In addition to the $1 billion which was in this bill there are no figures for the automatic triggers which go into effect in future years because no one knows the extent of the inflation in future years, but to the extent there is inflation in future years that would be in addition to $40 billion.

25 years and almost all of those in charge of the bill agree with the Senator from Illinois that it will be much earlier than that. Soon Congress will be confronted with a bankrupt fund unless it takes some action.

Mr. LAUSCHE. Mr. President, will the Senator yield?

Mr. WILLIAMS of Delaware. I yield. Mr. LAUSCHE. The report states on page 5:

By memorandum dated February 1, 1965, the President created the Cabinet Committee on Federal Staff Retirement Assistance under the foremanship of the Director of the Bureau of the Budget.

Mr. WILLIAMS of Delaware. That is

The Government owes $41 billion to correct. the fund.

Will the Senator restate the opinion expressed by the actuary concerning the financial soundness of the fund as it now exists?

Mr. WILLIAMS of Delaware. My understanding is that if Congress takes no action to appropriate the money or increase the contributing rate on the part of employees and the Government but continues as at present, this fund, which now has around $17 billion in it, will be now has around $17 billion in it, will be bankrupt in 20 or 25 years.

Mr. DIRKSEN. It will not take that long. I have received some figures from the Civil Service Retirement Board in connection with the Independent Office bill. I testified this year to get $1.063 billion put in that bill-the actuarial unsoundness of the fund. Long ago I consoundness of the fund. Long ago I conferred with the late President Kennedy many times, and after those consultations we drafted a bill, a budget bill to increase the Government share by onehalf of 1 percent annually up to a given number of years, to restore the given number of years, to restore the soundness of the fund. That bill died in the Civil Service and Post Office Committee and nothing was ever done.

Mr. LAUSCHE. In other words, we want to expand the payments, but not give regard to the expansion of income to meet the burden of making payments. to meet the burden of making payments. Mr. DIRKSEN. This proposal would add a billion dollars to unfunded liability.

If there is added the triggering unfunded rise, 3-percent retirement, and all the other little retirement schemes, the last figure I have seen, if we add the the last figure I have seen, if we add the public debt, is $843 billion. billion. We are getting close to the trillion mark.

In view of the fact there is a Cabinet Committee on Permanent Annuity Assistance and it is not due to file a report until the first of December, this matter until the first of December, this matter ought to go over, and we ought to have the benefit of the Cabinet study before we can intelligently legislate on this matter, instead of making this a piecework program.

Mr. WILLIAMS of Delaware. I thank the Senator from Illinois, and I agree the Senator from Illinois, and I agree fully with the comments he made. I am familiar with the figures he put in the RECORD which indicate that the fund would be broke in a shorter period than the 20 or 25 years to which I referred.

I am inclined to think his figures are I am inclined to think his figures are correct, but I was quoting the outside figures. Even with the outside estimate I received, it would be bankrupt in 20 to

Mr. LAUSCHE. Am I correct in assuming the President recognizes that a study has to be made of the Government retirement funds and recommendations of how the difficulty shall be handled, and that therefore he established this Committee?

Mr. WILLIAMS of Delaware. That is correct. They are supposed to report the first of December.

My point is, why should we not wait and get the benefit of that report before we start a piecemeal expansion of the present system.

Mr. LAUSCHE. Mr. President, will the Senator from Delaware yield for a brief statement?

The PRESIDING OFFICER (Mr. HARRIS in the chair). Does the Senator from Delaware yield to the Senator from Ohio?

Mr. WILLIAMS of Delaware. I yield. Mr. LAUSCHE. The Senator from Delaware knows about the Foreign Service retirement funds. They protect the workers of the Federal Government in the Foreign Service. The Federal Government now owes that fund $284 million. If the Federal Government paid the whole sum of $284 million today, in order to keep the fund actuarially sound, it would require a 30 percent contribution from each Foreign Service employee's salary. I repeat, 30 percent. Therefore, if a Foreign Service employee is earning $15,000 a year, in order to keep the fund sound, $4,500 of that $15,000 would have to be paid into the fund. That would mean that if it were split between the Government and the employee, each woud give 15 percent; but, it is now proposed that the employee put in 61⁄2 percent and the taxpayers 232 percent.

We all understand where we are heading. All of this confusion in the Foreign Service fund is the consequence of expanded payments without expanding the contributions which had to be made into the fund to keep it actuarially sound.

I subscribe to the position taken by the Senator from Delaware. I am deeply convinced that we cannot prevent inflation. Congress is indicating its own conviction that it cannot prevent it because of the principles it is adopting.

Mr. President, it makes no difference what the Senator from Texas says about it, the fact is that I will be benefited on my $30,000 salary, under the provisions of the pending bill, by an increase which, according to what I read in the report, will be 11 percent.

Mr. YARBOROUGH. Mr. President, will the Senator from Ohio yield at that point?

Mr. LAUSCHE. Not at this time. Mr. YARBOROUGH. On my own time?

Mr. LAUSCHE. I am glad to yield, on that basis.

Mr. YARBOROUGH. Let me point out that the annuities are not mandatory. No Senator has to accept them. They are voluntary. A good bite from my salary is taken out each month for

that purpose.

Mr. LAUSCHE. I heard the Senator's argument.

Mr. YARBOROUGH. Senators do not have to accept the annuity. If they do not wish to do so, the Government will not make them take it. It is voluntary.

Mr. LAUSCHE. I am reluctant to repeat this, but the Senator from Texas knows that I voted against the increase of 33 percent in Senators' salaries. I am giving my $7,500 increase to eleemosynary institutions. I did that because I felt that Congress should set an example by fighting inflation. Congress should not set an example which is heading everyone, at full speed, toward the eroding consequences which come from extravagant spending of the Federal Government's money.

I did not wish to make this statement, but the Senator from Texas tells me that I do not have to take the annuity.

To get back to my thought, I would be entitled to 11 percent more, as I understand, under the pending bill.

God help the taxpayers. God help the poor fellow who is working for a fixed salary.

I do not agree with the Senator from

Texas that Federal Government employees are underpaid. I do not subscribe to that statement.

Mr.

Mr. WILLIAMS of Delaware. President, I yield 8 minutes on my own time to the Senator from Florida. If he needs any additional time, I will submit an amendment so that he may get whatever time he desires.

The PRESIDING OFFICER. Is there objection?

THE 400TH ANNIVERSARY OF SETTLEMENT OF ST. AUGUSTINE, FLA.

Mr. HOLLAND. I thank the Senator from Delaware for yielding to me. I am sorry I did not advise the Senator from Texas that it would be my intention to speak and as to what would be the subject of my remarks, because I know that both of us wish to hear the Secretary of State at the hearing now underway.

Mr. YARBOROUGH. Mr. President, I have no objection to listening to the Senator from Florida. I merely object to extending the timeI

Mr. HOLLAND. I understand. should like to make it plain that nothing less than an urgent subject matter would have prompted me to ask for any time just now for I, too, wish to be at the hearings on the foreign aid bill. Later I must attend a conference on appropriations. I believe that the distinguished Senator and I both wish we had more time this afternoon. But today is the 400th anniversary of the permanent settlement of what is now the continental United States. It was on this day, 400 years ago, that Pedro Menendez de Aviles of Spain landed at St. Augustine. That little city has been permanently occupied every day since that time.

I commend the

Mr. WILLIAMS of Delaware. I thank

The PRESIDING OFFICER. Who yields time?

Mr. WILLIAMS of Delaware. Mr. President, how much time is left to each side?

The PRESIDING OFFICER. The Senator from Delaware has 20 minutes remaining, and the Senator from Texas has 37 minutes.

Mr. WILLIAMS of Delaware. I do not believe that we shall need all that time. I understand that the Senator from Florida has an 8- to 10-minute statement which he wishes to make. I ask unanimous consent that he be recognized so that he may make his statement, the time not to be charged to either side.

Mr. YARBOROUGH. Mr. President, Mr. President, I object-not to the Senator from Florida speaking, but I believe that we are about ready to vote on the bill.

Mr. WILLIAMS of Delaware. Then I am willing to yield to the Senator from Florida 8 minutes out of my own time for the purpose of making his statement.

Mr. YARBOROUGH. The Appropriations Committee is meeting to hear Secretary of State Dean Rusk on a very important matter in executive session.

The shoreline of my State was mapped in 1519 by one of the great Spanish explorers, Piñeda. It is still a good map of the shoreline of the Gulf of good map of the shoreline of the Gulf of Mexico.

The PRESIDING OFFICER. The Senator from Florida is recognized.

Mr. HOLLAND. I was sure that my distinguished friend the Senator from Texas would wish to know about this quadricentennial. I am not boasting, but only relating the fact that when the shoreline of Florida was discovered in 1513, it received its name from the fact that its Spanish discoverer, Ponce de Leon, discovered it on an Easter day when the flowers were in full bloom everywhere, and he gave it the name "Florida" to symbolize the flowery welcome which the Spanish discoverers found when they got there.

Mr. President, this is a great day for my State, for several other great States of our Nation, for most of Latin America, and for Spain, which truly is the mother country of so much of our Nation and of this Western Hemisphere.

Today, September 8, 1965, is the 400th anniversary of the settlement of St. Augustine, Fla., by the original Spanish pioneers, the first Europeans to estab

It was my great pleasure to spend last weekend at occasions which marked the formal opening of the quadricentennial celebration.

On Thursday night, Mrs. Holland and I were guests of the Spanish Ambassador, the Marquis de Merry del Val, and his wife, at the Spanish Embassy in Washington at a dinner given in honor of

the distinguished eight-man official delegation from Spain, and their ladies. It was attended by many officials of our country and of Latin American nations. Friday noon I attended a luncheon at the Department of Interior given by Secretary Udall in honor of our Spanish guests.

Saturday I presided at the dedication of the Pan American Building at St. Augustine where Ambassador Plate of Paraguay, chairman of the Organization of American States, was the principal speaker. That night we were guests at a large dinner given by the city of St. Augustine at which the speakers were Mayor John D. Bailey, the Minister of Interior of Spain, Lt. Gen. Camilo Alonso Vega, who was head of the Spanish delegation, Secretary-General Jose A. Mora of the OAS, and Secretary of State Tom Adams of Florida.

Sunday morning we attended a dignified outdoor Mass at the Nombre de Dios Shrine at the spot where the Spaniards landed in 1565. Later we attended the dedication of the Florida Building by Gov. Haydon Burns and the Governor's luncheon where Governor Burns and the Hereditary Spanish Governor of Florida, the 19th descendant of Pedro Menendez, the first Spanish Governor, were guests of honor and principal speakers.

Mr. President, I think it is worthy of note that that worthy descendant of Pedro Menendez still holds the honorary title of Hereditary Adelantado of Florida.

Sunday afternoon I presided at the dedication of the Hispanic Garden and the unveiling there of a statue of Queen Isabella, and later at the dedication of the Spanish building, Casa del Hidalgo, a beautiful structure of native coquina planned by a noted Spanish architect who was present. The speakers were Gen. Alonso Vega and Secretary of the Interior Udall who were followed by Archbishop Hurley who gave the dedicatory blessing.

The actual anniversary of the landing of Pedro Menendez is today, September 8, and the Catholic Church is putting on a highly dignified celebration of the anniversary on this date which will be participated in by many high-ranking members of the clergy and other distinguished citizens from Spain, the Latin American countries and our own Nation. My distinguished colleague, Senator SMATHERS, is participating in that program today. I think it is appropriate to say that the Catholic Church has also spent a large sum in constructing additional edifices at and near the site of the Nombre de Dios Mission, including among others an imposing bridge, a mu