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rowers made reductions. In fiscal year 1962, 31 systems made rate reductions. In fiscal year 1963, 77 systems made rate reductions. During the first 7 months of this present fiscal year, 70 borrowers have already adopted rate reductions which will amount to savings of almost $2 million annually for rural consumers. Forty-nine other borrowers are considering recommendations for rate reductions which, if adopted, will amount to annual savings of another one-half million dollars.

But what of this new dimension in rural electrification-the future?

The best estimates available would indicate that all of the electric systems of America-cooperative, private and public-will need more than $140 billion of new capital for expanded plant facilities to meet the growing demand for service by 1980. For your rural systems the need for new capital will grow accordingly. This projection inevitably leads us to consideration of where this capital is coming from and how it will be provided.

In the light of probable future requirements for new capital in this rapidly expanding electric industry, it certainly is sensible for you to explore the possibilities of supplemental financing in the private money market as your national association proposes to do.

Without in any way attempting to prejudge the results of your study, I think we may reasonably anticipate that the evolution of the REA-financed rural electric systems probably divides into three stages.

In the first stage, where there has not been an opportunity to fully develop the basic equalizers to narrow the gap of low consumer density and low revenue, not only is REA financing the only possible source of initial capital but the low 2 percent interest rate is an indispensable factor in the feasibility of the system.

As the basic equalizers of rural area development, low-cost power supply, adequate territorial integrity and effective management are developed, and as the revenue base per dollar invested is increased, there will be systems which will move into a stage where rural parity of electric service is possible and feasible at a higher rate of interest but where REA still remains the only source of new capital for development and expansion.

The third and ultimate stage on which so many of the outside experts seem to be counting these days is that stage of development at which these systems will attract the resources of the private money market.

I doubt if there are many rural systems in the country which have net worth and market or territorial security in the style to which private investors in utility securities have become accustomed. If to qualify for private investment it is necessary to add to this a need for margins which will produce the usual "times charges earned" ratios of utility companies, and do this all with parity rural rates to keep faith with the objectives of rural electrification, the number of rural electric systems which can qualify for private financing will be still further reduced.

We have heard references to the approach of the Ohio cooperatives for private financing, and they are indeed breaking new and challenging ground. However, even if they are successful, it must be recognized that there are elements in the arrangements they are developing which are by no means typical of the present potential of rural electric cooperatives generally.

In between the present basic type of REA financing and the ultimate access of rural electric systems to the private money market, there is a middle ground which ought to be studied and explored.

To the extent that the present 2-percent interest rate on REA financing is held to involve a cost to the Federal Government,

it can be expected that, from the public standpoint, there will be resistance to providing the full future capital needs of rural electric systems on such a basis if these needs increase as they are presently expected to increase. At the same time, from the REA borrower standpoint, there are growing indications that the restrictions on the use of REA present basic loan funds may in the future be an obstacle to the most efficient and effective development of maturing rural systems.

There may well be a need then for developing, in addition to the present basic 2percent REA financing, a new type of financing for rural electric development which offers the borrower greater freedom of financial planning and system development but at an interest rate that is fully compensatory to the Federal Government.

Let me cite for you just one or two examples to indicate the type of problems which arise with the present restrictions on REA financing.

In the State of Oregon there was enacted in 1961 a territorial allocation law which provides a procedure whereby electric utility systems have the opportunity to negotiate territorial settlements among themselves and the sale or exchange of facilities to eliminate duplication by competing systems in the same areas. These settlements, if approved by the Public Utility Commissioner, then become the basis for exclusive territorial allocation.

This procedure can result in a very desirable untangling of competing facilities and consequent improvement in the maximum utilization of the capital facilities of all systems concerned, including rural electric systems. The Rural Electrification Act, however, limits the Administrator's loan authority to providing service for unserved persons in rural areas. There is a grave legal question as to whether this authority would fully and in all cases cover loans for the acquisition of facilities involved in settlements such as are possible in Oregon.

In some instances we have been able to justify loans for acquisition of existing facilities, either because the service they rendered was so unreliable as to constitute no service, or because the acquisition became a necessary but incidental act in the extension or continuance of service to other rural consumers who qualified under the Rural Electrification Act as unserved persons. But there is reason to believe that not all of the situations which will arise in the future can be met on these grounds. Yet everyone will agree that there are many situations in which the acquisition of existing facilities is a thoroughly desirable and proper business step in the interest of better and more economical service for all the consumers concerned.

In the State of Nebraska legislation has been under consideration to reorganize on a more orderly and efficient basis the generation, transmission, and distribution functions in that public power State. If this comes to pass, it is very possible that the rural systems may find they are expected to acquire some existing facilities belonging to other power systems of the State, and it may be very difficult for REA to finance such acquisitions under its present lending authority. Even though the effect of such a reshuffling of properties and service responsibilities might be extremely beneficial to the rural consumers through the greater effectiveness and efficiency of their distribution systems, it might fail because of present limitations on REA loan authority.

In the Ohio situation to which I made a passing reference, there is illustrated another problem of REA's limited lending authority. It has traditionally been REA policy to limit the size of a generating plant financed with REA funds to the capacity

which would be fully required by the needs of Rural Electrification Act beneficiaries, rural persons previously without central station service, within a period of 10 years. In most cases, the projected capacity is planned to meet the load requirements of act beneficiaries within 5 to 7 years. In the plan the Ohio cooperatives are endeavoring to develop, it is proposed to use the power cost economy of a very large generating unit to offset the higher cost of capital which will be required if they go to the private money market. To get this kind of power cost economy, the Ohio cooperatives are proposing to build a 615 megawatt unit which, on the basis of present load projections, will not be fully loaded with Rural Electrification Act beneficiary loads until 1984, or 17 years after the time the unit is expected to be in operation.

With these problems in mind, I would propose that while you, through your national association, are studying the possibilities of supplemental financing in the private money market, we in REA undertake a study of the possibilities of a type of intermediate financing for rural electrification which would on the one hand be free from some of the restrictions placed upon the present basic REA financing and, on the other hand, return a rate of interest which would fully compensate the Federal Government for the cost of its money.

I make this suggestion for your thoughtful consideration and let me make it clear

that we would welcome your counsel.

In making this suggestion I also want to emphasize that such intermediate financing should not be considered as a replacement of the present basic financing of REA at the present 2 percent rate. For the foreseeable future there will continue to be a need for the present basic 2 percent REA financing. For new systems just getting started, for systems in areas of slow growth and special problems this type of financing and the favorable interest rate remains an indispensable equalizer and must be continued.

For such financing, which is made available at some public cost, it is only fair and proper that its use be carefully confined to the basic program needs. For this reason it can be expected that there will continue to be reasonable restrictions placed upon its

use.

The new type of intermediate financing would be designed to fill the needs of those rural systems which through growth and maturity have successfully met the basic program needs but will still need new capital to move toward both greater consumer benefits and the increased operational and financial strength necessary to qualify ultimately for private financing.

If this intermediate financing is made fully compensatory to the Federal Government through a higher interest rate, the Federal Government could clearly afford to make such loans available in the greater volume necessary to meet the anticipated needs of the future. It could afford also to make such financing available on a less restrictive basis offering the maturing systems greater flexibility of development.

As we look to the future of rural electrification, the overriding issue remains what it has long been-is its purpose just to provide some kind of service to rural people at rates which still reflect the high cost handicaps of rural areas, or is it really to bring to rural people and rural communities in America the full-scale blessings of electric service that are available to urban people and urban areas? Are your rural systems which were built through the dedication and sacrifice of rural people themselves to be considered as merely stopgap systems or are they to be so built and strengthened that they will endure to serve rural America on a sound, permanent and self-sustaining basis?

On this issue we in REA have taken our stand. This administration has made a clear and unmistakable record. But our efforts alone cannot bring the achievement we seek in rural electrification unless they are supported by yours.

Today as we have together looked back briefly over the progress of these past 3 years, I want to acknowledge with deep personal feeling the magnificent way in which you have supported this great national program, for the way you have borne your responsibilities in it, for the zeal and public dedication with which you have carried it forward. I want to pay personal tribute to your national association, the National Rural Electric Cooperative Association, your president Al Hauffe, your other distinguished officers and board of directors, your great general manager, Clyde Ellis, and your dedicated staff for their unceasing devotion to the true objectives of rural electrification.

Working together we have made progress these past 3 years.

As we turn to this new dimension of rural electrification, the future, let us, together, draw fresh inspiration from the achievements of the past but add to it fresh thinking for the problems at hand and ahead. Let us, together, make certain that the lights which have been turned on in rural America never go out.

EXPANDING SOVIET TRADE

Mr. SYMINGTON. Mr. President, earlier this week some of us had the opportunity to discuss foreign trade with Mr. Fritz Berg, president of the Federation of German Industries. Some of his thoughts were most interesting.

In that connection I ask unanimous consent to insert at this point in the RECORD a thoughtful editorial from the St. Louis Post-Dispatch entitled "Expanding Soviet Trade."

There being no objection, the editorial was ordered to be printed in the RECORD, as follows:

EXPANDING SOVIET TRADE

pressed by other Russian officials and publications.

The U.S. position on trade has been that a substantial expansion cannot precede at least substantial expansion cannot precede at least a start on settlement of major East-West political issues. Is it not possible, however, that political settlements would follow the resumption of normal commercial relations? Trade could be the means of breaking political stalemates.

Americans who react on a moral plane to trade with Communists overlook the matter of national self-interest and what is actually afoot in the world. The West Germans profess violent objections to Communist business, for example, but actually conduct the most extensive trade with the Soviet bloc. In the last 16 months West Germany has agreed to exchange trade missions with every East European country except Albania.

This may be hypocrisy, but it reflects the German national interest; and national interests are not always exactly what they may superficially appear to be. Some cynics say the United States can afford to be tougher than its allies because it hasn't as much at stake. Foreign sales are two to three times as important to the leading Western European countries as they are to the United States, and these countries have been increasing trade with the Communists (and other nations) at a rate of about 7 percent a year.

This rising volume is exerting steady pressure on U.S. policy, and it is almost certain

to bring a liberalization unless some EastWest political disaster intervenes. If education is needed, as Mr. Hodges says, then the administration ought to provide it so the public will be aware of the issues.

There should be a fine opportunity to make a start on this in connection with the United Nations trade conference opening at Geneva March 23. The Russians have been preparing to exert a dominant role at this conference. prevent its allies from seeking more trade The United States is not going to be able to

where they can find it, and it will eventually be forced to liberalize its own policies. Here is a field in which the United States should be a leader, rather than a reluctant follower.

Albeit with caution, the administration appears to be moving toward an expansion THE OUTSTANDING RECORD OF

of trade with Russia and the Communist satellites, joining a movement that has been underway among the Western allies for some time. The shifting of the United States attitude is not entirely voluntary, but reflects in considerable degree the imperatives of today's international scene.

There is not likely to be a sudden and dramatic change. As Secretary of Commerce Hodges said the other day, "more education" will be required. Mr. Hodges believes the main barrier to increasing trade with the Soviet Union is "political feeling" in the United States; otherwise, he thinks, "we are now at the stage where we could go a long way toward normalizing trade relations" with Russia.

Secretary of State Rusk took much the same line in testifying before the Senate Foreign Relations Committee on Friday. The United States, he said, is taking a realistic look at the possibility of expanding trade with Communist countries, particularly with those countries of Eastern Europe which are seeking to reduce their economic dependence on Russia. He suggested that inflexible restrictions on trade with the Soviets might be helping them to become more self-sufficient; certainly it is hard to see how they have hampered Soviet growth.

Since the consummation of the wheat deal, the Russians have expressed heightened interest in more trade with the United States; trade is now at the rate of about $50 million a year. Last week First Deputy Premier Kosygin advocated a long-term United StatesSoviet trade agreement, reflecting views ex

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PEACE CORPS: A SHINING FACE OF AMERICA On a grim day in Washington, when crises are crackling all over the globe, the President can always rear back in his oval room office and smile at thoughts of the Peace Corps. Corps. This organization is 3 years old today and a sparkling success. It has been strikingly effective in aiding nations that need help. And it has been a brilliant means of putting this country's best face forward to the world.

Almost everybody with a free choice seems to love the Peace Corps. It is even distinguished for the hatred it draws-mainly from the bleaters of Communist propaganda.

But in Washington the Peace Corps ranks just behind home and mother as an object of political veneration. Even though the corps is a prize brainchild of the KennedyJohnson administration, Republican leaders are eager to praise it. Among the conserva

tives in Congress, no one has commented more enthusiastically on the Peace Corps record than Senator BARRY GOLDWATER, Republican, of Arizona, and Representative HOWARD W. SMITH, Democrat, of Virginia, the hard-to-impress chairman of the House Rules Committee. They say it's great.

Still, as the adage goes on Capitol Hill, appropriations are the payoff. For its size, the Peace Corps does as well or better in this respect than any agency in the Government. Starting with $30 million in 1961, the Corps is in line for $115 million to finance its operations during the 1965 fiscal year. In the same period other items in the foreign aid money bills have been slashed heavily.

With election-year economizing in full bloom, the Peace Corps is being encouraged to expand as rapidly as it can. That is being done. As of last week, the Corps has 7,300 volunteers, 6,668 of them abroad in 46 countries. This number is scheduled to rise to 10,500 by next September and 14,000 the following year. Qualified Americans clamoring to join and foreign nations will take all the volunteers they can get.

are

With all of this growth, no one has accused either the organization or its director, R. Sargent Shriver, of empire building. Shriver, who was at first known mainly as a brotherin-law of President Kennedy, is generally credited with an outstanding job. He is often mentioned as a possible vice-presidential running mate for President Johnson.

Some of Shriver's best work has been in

public relations. He has crisscrossed the land, taking the story of his organization to cities and towns, colleges and universities, as he has sought out volunteers. There has been no shortage of applicants-40,000 last year and an expected 55,000 this year. The quality is so high that only one in four or five has been accepted up to now. Of those signed up, the average age is 25.

So it is primarily a legion of totally dedicated young men and women. They receive no pay, only living expenses and $75 monthly severance pay. They are not even exempt from the draft. Over half of those who returned from overseas have gone back to the campus. Several universities have set up special fellowships and scholarships for the Peace Corps returnees. The absence of pay and benefits probably is one of the secrets of success. A lot of people would love to go to foreign climes with a large salary, staff car, and all the comforts of the American material civilization. These people are not attracted to the Corps.

As a group, the record of the volunteers is remarkable. So far, only about 4 percent of the Peace Corps have been returned home from overseas for failing to measure up to standards. Originally, it was expected that about half would be dropped from the untried, pioneering program. Eight volunteers have died on foreign service, either in plane or motorcar accidents or from natural causes. There have been numerous marriages within the Corps.

So the Peace Corps represents a slice of America at work for other people in foreign places. The volunteers do not regard themselves as earth shakers but as good Samaritans. They go into the backlands of the world for the purpose of helping people of little progress learn to help themselves.

Their efforts take many forms. For example, the University of Kansas became the first State university 2 years ago to contract for a project for a country. It undertook a Peace Corps project for Costa Rica, trained the members on the campus, and sent a professor on leave to direct the program of teaching English, the sciences and library services in the high schools and the University of Costa Rica. The project followed a student exchange program with Costa Rica.

Other typical programs include: Helping build roads and draw geological maps in

Tanganyika; working on rural development and farm projects in Guinea, Venezuela, Pakistan, Turkey, Malaysia, Nepal, and Chile; helping control malaria in Thailand; teaching a variety of skills in Afghanistan, including the operation of printing presses; organizing community action programs in turbulent Cyprus, where the Greeks and the Turks have yet to learn mutual tolerance and cooperation.

Education probably is the most important single type of activity. But hundreds of special skills have been enlisted for the various projects. The Peace Corps-and the United States-are represented abroad by qualified surveyors, geologists, nutritionists, carpenters, nurses' aids, plumbers, veterinarians, and even professional fishermen.

There is a kind of fundamental humility about these volunteers and their work. Most live not in comfortable great cities but in remote villages out in the boondocks, far removed from modern convenience. Many have stayed with native families.

Sometimes their missions take dangerous turns. Robert Ferguson, a volunteer from Honolulu, was one of four Americans held hostage for 10 days by tin miners in Bolivia. It was not an anti-American move but a derring-do retaliation for the arrest of two Communist-line union leaders by the Bolivian Government.

Only one government-that of police-state Ghana-has decided to ask Peace Corps volunteers to leave. The Ghana Government accused American teachers of subversive activities. It was nonsense concocted for domestic political reasons in a country that has swung far to the left.

In Peru a Communist demand for expulsion of the Peace Corps as spies for the United States got nowhere. An organization speaking for 50,000 city slum-dwellers rallied to the defense of "the noble and humane mission of the members of the Peace Corps who are working in Peru." Last week Tunisia asked for at least 200 more of young Americans in addition to the 90 now aiding that North African country in its struggle toward development.

Only one embarrassing incident has occurred and that was in the first few months of the program overseas. There was a brief uproar over a girl in Nigeria whose indiscreet postcard fell into unfriendly hands and was twisted into anti-American propaganda. This is the only known case of its kind, yet the possibilities for blunder were enormous.

Since the Corps was started by the late President Kennedy, more than 9,000 volunteers have served overseas. Most were in their early twenties, scattered over the earth in unfamiliar settings. They were the "guinea pigs" for a new type of international program, with floodlights of attention fixed on their every move. The way they have handled themselves is superb evidence of the high selection and training standards.

In all of the dozens of projects in the 46 countries benefited, there has been no hint of a boondoggle. The results up to this time are of course impossible to measure exactly. But the Peace Corps is training teachers, farmers, and craftsmen who not only can do their own work but can impart their newfound skills to others. The long-range effect will surely be to create whole new classes of teachers and artisans for people who have lacked such human resources.

The American people obviously like what the Peace Corps is doing. This general approval at home is reflected in the enthusiastic support which the volunteer organization receives from Congress. It also explains why some strictly practical men in Washington regard the Peace Corps as a superb political exhibit for the Johnson administration in the approaching election.

Moreover, the place of John F. Kennedy in history may well depend in part on his origination and sponsorship of the Peace

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We believe that the record of the last 3 years is clear on one point: Dollar for dollar, in terms of both good will and positive benefits, the Peace Corps has already paid for itself many times over. There is no better investment of foreign-aid funds in sight.

Thus the United States has cause to be delighted with the report card on this organization for its first 3 years. It has given greater luster to this Nation's image before the world. The outlook for further splendid service by the rapidly maturing Peace Corps could scarcely be more promising.

The ACTING PRESIDENT pro tempore. Is there further morning busiIf there is no further morning business, morning business is closed.

CIVIL RIGHTS ACT OF 1964 The Senate resumed the consideration

of the motion of Mr. MANSFIELD that the Senate proceed to consider the bill (H.R. 7152) to enforce the constitutional right

to vote, to confer jurisdiction upon the

district courts of the United States to provide injunctive relief against discrimination in public accommodations, to authorize the Attorney General to institute suits to protect constitutional rights in public facilities and public education, to extend the Commission on Civil Rights, to prevent discrimination in federally assisted programs, to establish a Commission on Equal Employment Opportunity, and for other purposes.

The ACTING PRESIDENT pro tempore. The question is on agreeing to the motion of the Senator from Montana [Mr. MANSFIELD] that the Senate proceed to consider the bill (H.R. 7152). Mr. MANSFIELD. Mr. President, I suggest the absence of a quorum. The ACTING PRESIDENT pro tempore. The clerk will call the roll.

The Chief Clerk called the roll, and the following Senators answered to their

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the Senator from Tennessee [Mr. GORE], the Senator from Washington [Mr. JACKSON], the Senator from Massachusetts [Mr. KENNEDY], the Senator from Missouri [Mr. LONG], the Senator from Wyoming [Mr. MCGEE], the Senator from Utah [Mr. Moss], the Senator from Maine [Mr. MUSKIE], the Senator from Rhode Island [Mr. PASTORE], the Senator from Texas [Mr. YARBOROUGH], and the Senator from Ohio [Mr. YOUNG], are absent on official business.

I also announce that the Senator from West Virginia [Mr. RANDOLPH), is absent because of illness.

I further announce that the Senator from California [Mr. ENGLE], is necessarily absent.

Mr. KUCHEL. I announce that the Senator from Arizona [Mr. GOLDWATER], and the Senator from New Mexico [Mr. MECHEM), are necessarily absent.

The Senator from New York [Mr.

JAVITS], is absent on official business.

The PRESIDING OFFICER (Mr. WALTERS in the chair). A quorum is present. unanimous consent that I may yield to Mr. STENNIS. Mr. President, I ask

the Senator from Ohio without losing my right to the floor and without a subsequent speech counting as a second speech on the pending motion.

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

GOLD BACKING FOR U.S.
CURRENCY

Mr. LAUSCHE. Mr. President, I am putting it mildly when I say I was deeply shocked this morning to learn that the Joint Economic Committee of the House of Representatives and the Senate has recommended the repeal of the present law, under which our currency is backed by a reserve of 25 percent in gold. The Federal Reserve bank must maintain reserves in gold certificates of no less than 25 percent against its deposits and its Federal Reserve notes in actual circulation.

The recommendation is direct. It states:

The U.S. gold stock should be freed immediately of its domestic reserve function and made fully available for international monetary purposes.

The requirement that there shall be 25 cents in gold for every Federal Reserve dollar issued is an anchor against printing-press money. If that requirement is removed, there will be no limitation of any character except the judgment of Federal officials which changes like the winds concerning what the limitation shall be on the issuance of paper currency.

I wish to make my statement early disapproving this recommendation. I have been anticipating for 2 years that the avenue of escape finally would be the recommendation that the gold support be removed. I think we shall be in for a bad day if the tax-cut expectations go wrong. If the gold support requirement is removed, we may experience the inflation that exists in Brazil and Argentina and other places in the world.

I shall have more to say on this subject. I thank the Senator from Iowa

[Mr. MILLER] and the Senator from Idaho [Mr. JORDAN] for their dissenting opinion with respect to this recommendation. I thank the Senator from Mississippi for yielding.

Mr. ROBERTSON. Mr. President, will the Senator from Mississippi permit me to respond to the remarks of the Senator from Iowa?

Mr. STENNIS. Mr. President, I make Mr. MILLER. Mr. President, will the the same request that I made heretofore, Senator from Mississippi yield?

Mr. STENNIS. I make the same request, that I may yield to the Senator from Iowa without losing my right to the floor, and that my subsequent speech will not be counted as an additional speech on the pending motion.

Mr. MILLER. I thank the Senator from Mississippi.

I clearly endorse what has been so ably said, not only this morning, but on many other occasions by the able Senator from Ohio [Mr. LAUSCHE]. I point out that we are on the minority in our views with respect to this problem, so far as the Joint Economic Committee of the Senate and the House of Representatives is concerned. I regret that it is so, but a majority of the members of this committee has subscribed to this report,

with the recommendation therein that the gold requirements backing up our dollar be repealed. Only a minority of

us have dissented.

I like to think that the minority represents the views of the majority of the Members of Congress. I believe it would be tragic to compound the creeping inflation which is already occurring in the economic status of our country.

For a long time there has been a steady decline in the purchasing power of our dollar. This decline is at the rate of 12 percent a year. It would be tragic to compound that situation with a repeal of the gold standard requirements.

There are those who say superficially that the gold stock in Fort Knox is only a pile of gold which is lying there and not doing anybody any good, and that we ought to free this gold to meet our requirements with respect to the gold holdings, dollar holdings of our friends overseas.

There are two answers to that. The first answer is that if we handle our fiscal affairs properly, we shall not have to use this gold. Instead of having a problem, let us eliminate a problem. The second answer is that while the gold supply may not be doing anybody any good from a materialistic standpoint-the standpoint of the morale and the integrity of our country-it stands as a psychological barrier to depreciation of our currency. There may come a time when this gold requirement can be modified. But the But the time is certainly not now. At the rate we are going, I do not see that it is going to arise in the immediate future. So I want to make it clear that a few of us on the Joint Economic Committee feel very strongly about this point. I express my continued appreciation to the Senator from Ohio for his leadership in stressing the importance of following a proper and safe policy on this very important matter.

Mr. ROBERTSON. Mr. President, will the Senator from Iowa yield to me? Mr. MILLER. The Senator from Iowa does not have the floor; the Senator from Mississippi has the floor.

and ask that I may yield to the Senator from Virginia under those conditions. The PRESIDING OFFICER. Without objection, it is so ordered.

Mr. ROBERTSON. Mr. President, the junior Senator from Virginia has heard the interesting statements of his colleagues, especially the statement by the Senator from Iowa that it is his belief that he and the Senator from Ohio [Mr.

LAUSCHE] are in the minority on the I assure Joint Economic Committee. them that some members of the Democratic Party fully share their view that it would not be at all wise or desirable for the U.S. Government to repeal the 25-percent gold backing. That question has been before Congress, off and on, for 3 years.

As chairman of the Committee on Banking and Currency, which is the committee that would handle the matter if it were in bill form, I have repeatedly

said that I do not approve of that recommendation. Incidentally, I placed in the RECORD this morning a three-page statement explaining why such a proposal would not help the United States in its balance of payments.

If we treated all the gold that now is behind our currency as so-called free gold, it still would not pay off all the dollars outstanding in foreign hands and foreign institutions if they should lose confidence in us. Why do they want our dollars? Why do they use our dollars as backing? Because it is the best currency in the world. They have confidence in us. What we should do is to manage our own affairs so that we will not have galloping inflation and so that foreign nations will continue to have confidence in us.

Incidentally, I have just learned that tremendous pressure is being placed on the Swiss franc. That information has not yet appeared in the press, but I have learned from an unimpeachable source that the Swiss franc is now under the gun. Swiss money has always been considered to be the refuge of hot moneys. If we go into the banks of Switzerland, we will find that the Swiss are living beyond their means. Their balance of payments is running to the point where they will have inflation of a serious character. That is true, more or less, all over Europe. And other European money is not as good as it may appear to be.

Our money today is the best money in the world. It is vital that in the months that lie ahead we control our spending and our fiscal program so as to maintain essential confidence in the soundness of the processes of our Government and our currency. I explained the situation in the memorandum I the memorandum I placed in the RECORD. I hope Senators will take the time to read it. I explained in my previous statement, which I did not read into the RECORD, why I do not believe that at this time the recommenbelieve that at this time the recommendation of the Joint Economic Committee is sound or desirable.

Mr. MILLER. Mr. President, will the Senator from Mississippi yield, so that I may respond to the Senator from Virginia?

Mr. STENNIS. Mr. President, I ask unanimous consent that I may yield to the Senator from Iowa for the same purpose and with the same understanding as before.

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

Mr. MILLER. Mr. President, will the Senator from Missouri permit me to respond first?

Mr. SYMINGTON. Yes.

Mr. MILLER. When I said I would

like to think that a majority of the Members of Congress did not agree with the majority of the Senate-House Joint Economic Committee, uppermost in my mind in that majority would be included the distinguished and able junior Senator from Virginia [Mr. ROBERTSON] and his colleague the senior Senator from Virginia [Mr. BYRD], together with others, because I do not know of any two Senators who adhere more closely, not only to the words "sound economic and fiscal policy," but also to the deeds and to the rollcall votes to support them; and I wish to let the Senator from Virginia know how I feel about him and his colleague in this respect.

Mr. ROBERTSON. Mr. President, on behalf of the senior Senator from Virginia, the junior Senator from Virginia expresses appreciation for the high compliment the Senator from Iowa has paid both Senators.

Mr. SYMINGTON. Mr. President, will the able Senator from Mississippi yield?

Mr. STENNIS. I yield under the same circumstances, if I may have unanimous consent in that connection.

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

Mr. SYMINGTON. Mr. President, the colloquy we have just heard is not too surprising. Last fall I made five talks on the balance-of-payments situation, and pointed out that our Government had only some $3 billion of free gold with which to honor $28 billion of current liabilities redeemable in gold and now owned in the main by foreign central banks.

Mr. ROBERTSON. Our free gold has now decreased to $2.6 billion.

Mr. SYMINGTON. Then that shows even further deterioration of our position.

Not long ago an article on the flight of the U.S. dollar was published in the Saturday Evening Post. The article pointed out that the term "unfavorable balance of payments" was in effect a nice term for weakening of the dollar. Inasmuch as many of the countries of Europe own a great many U.S. dollars, it would seem this proposed action not only would hurt the United States but also impinge on the solvency of other countries which accepted in good faith the statement our dollars would be backed by a 25percent gold reserve.

I would present some of the figures incident to this situation. They are interesting: 15 years ago the United States has nearly $25 billion in gold bullion

and owed the foreign central banks of the world, a little more than $5 billion in current liabilities. Today our gold reserve has been reduced from some $24.5 to $15.5 billion; and our current liabilities-obligations redeemable in gold, and owned by foreign central banks have increased from $5 billion to approximately $28 billion.

Therefore, even if we now do away with this pledged gold reserve against our currency-which, in effect, would mean we would at least partially go off the gold standard, insofar as our commitments are concerned-we would still be many billions of dollars short of being able to honor those obligations owned by foreign countries, redeemable in gold, in case they demanded payment.

So, I hope the distinguished chairman of the Banking and Currency Committee, the Senator from Virginia [Mr. ROBERTSON] and other Senators such as the distinguished Senator from Iowa [Mr. MILLER] and the distinguished Senator from Ohio-will have some committee discussion of this situation, in order that the people will know the latest with respect to our unfavorable balance of payments.

In the last 6 years, the United States has lost not less than $16 billion through the unfavorable balance: $2 billion in the private domain; $7 billion by selling our own gold; and $7 billion through additional borrowings by means of such short-term securities as the so-called Roosa bonds.

If this condition continues, regardless of whether the Congress approves of the elimination of this guarantee of a 25percent gold reserve behind our dollars, we shall have fiscal and monetary troubles in our economy.

I thank the able Senator from Mississippi for yielding to me.

Mr. ROBERTSON. If there were introduced a bill calling for complete abandonment of the anchorage of our currency to gold, I think I could commit the leadership to the proposition that the bill would be referred, for study and hearings, to the Senate Banking and Currency Committee; and if it were so referred, I assure the Senator that all interested parties would have a full and free opportunity to express their views; and that the bill would not be rushed back to the Senate or brought to the Senate without a full understanding of what is involved.

Mr. MANSFIELD. Mr. President, will the Senator from Mississippi yield to me?

Mr. STENNIS. Yes. Mr. President, I ask unanimous consent that I may yield to the Senator from Montana, under the same conditions.

The PRESIDING OFFICER. Is there objection? Without objection, it is so ordered.

Mr. MANSFIELD. Mr. President, I have been interested in the debate about financial stability, the flight of the dollar, and the outflow of gold.

The distinguished Senator from Virginia [Mr. ROBERTSON] is chairman of the Committee on Banking and Currency, and is also chairman of the Appropriations Committee Subcommittee

on Treasury and Post Office Appropria- glad to get that penny. So I carry it tions. around.

I wish some serious consideration could be given to the inflow of silver. Montana is a silver-dollar-using State. There is a great scarcity of silver dollars in Montana; and we would like to see in Montana; and we would like to see something done, by means of which an appropriation would be made, so that the Director of the Mint could mint some more silver dollars. As I understand it, paper money is turned in on the average of about every 3 months because it wears out and becomes useless. A silver dollar lasts for decades. It is something solid, something one can throw on the counter-or perhaps on the bar.

Mr. President, a man knows he has something in his pocket when he has a silver dollar there.

Furthermore, the Government does not lose any money on the minting of silver dollars; in fact, I believe that, under seigniorage, the Government makes a little money, a reasonably good profit.

I understand that at the present time the mint is dipping into the last silver dollars it has, and is even releasing those dollars it has, and is even releasing those under date of 1880. I also understand that those silver dollars have a value in excess of $1, insofar as collectors are concerned. At the start of 1963, there were 94 million silver dollars in the Treasury; 94 million silver dollars in the Treasury; today there are only 28.5 million silver dollars remaining and they are going fast.

There is a great deficiency of silver dollars in the State of Montana. Mondollars in the State of Montana. Montana, along with Nevada, is the only State which looks upon the silver dollar as a far better and more durable item of currency than a paper bill.

So I would hope, and I would plead with the distinguished chairman of the Subcommittee on Appropriations for the Treasury and of the Banking and Currency Committee, that the necessary funds be allowed, so that up to $150 million of silver dollars can be minted so lion of silver dollars can be minted so that the demands of the people-not only those in my State, although primarily the ones there, so far as I am concerned, the ones there, so far as I am concerned, but also the people in the other Statescan be met.

Mr. ROBERTSON. Mr. President, I assure the Senator from Montana that he has touched on a very vital issue. he has touched on a very vital issue. When he refers to the fact that paper money wears out, but that silver dollars money wears out, but that silver dollars will last, he reminds me of the ScotchIrishman in the valley of Virginia who Irishman in the valley of Virginia who told me, "Senator, I like money that the dog can't chew up." He was so right; and all of us like every now and then to and all of us like every now and then to put our hands in our pockets and feel put our hands in our pockets and feel something tangible.

I show to my colleagues a Chinese penny which I obtained in Hong Kong in 1935. It is made of copper. The inscription on the penny has long since worn off, but I still keep the penny. I got it when I visited Hong Kong, where got it when I visited Hong Kong, where the people have an average income of only $90 a year. This is only a penny, but a penny is important to them. I but a penny is important to them. have kept it in my pocket to remind me of the fact that the many people who are not under our form of government and not under our form of government and our free enterprise system would be very

I

In reference to the silver situation, I should like to point out that there has been such a demand for the memorial Kennedy coins that they are being offered for $2 and $3 apiece before the coins have even come from the mint.

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

Mr. STENNIS. I yield.

Mr. MANSFIELD. I would hope that in his dual capacity as a chairman of that particular subcommittee of the Committee on Appropriations and as chairman of the Committee on Banking and Currency, the Senator from Virginia would undertake an investigation into the subject of the accumulation or the taking of orders before the Kennedy silver half-dollars are made available. I understand, also, that they are being offered, when they become available, for $2.50 to $3 each when the coins have a value of only 50 cents.

Mr. ROBERTSON. That is true. Mr. MANSFIELD. I hope that an investigation of that subject will be undertaken.

Mr. ROBERTSON. Some people believe that a silver dollar will be worth more than $1.29 for the value of the silver in the coin. When the value rises above $1.29 an ounce, which is the price we have now fixed, the silver in a silver dollar will be worth more than a dollar. So collectors are buying up the coins and holding them, speculating that prices will be inflated.

My friend has brought up a vital issue and, if the distinguished majority leader would lay aside the civil rights bill, the chairman of the Committee on Banking and Currency would go into the investigation immediately.

Mr. MANSFIELD. Mr. President, I do not intend to be diverted from my main theme. I am not being facetious about the silver dollar. It is solid and durable. It is something that we know represents money, in contrast to paper. I would most certainly hope that to supply the deficiency which we are feeling in my own State, which along with Nevada, I repeat, is the only silver-dollar-using State in the Nation, and in which we desire to continue to use silver in preference to paper, I would hope that the distinguished Senator from Virginia, in his dual capacity, would see to it that the necessary funds are forthcoming to continue the minting of this vitally needed coin, because solid silver to us is most important and needed. Even some of our banks are out of or running out of silver dollars. The situation is indeed serious.

Mr. ROBERTSON. The Senator from Virginia fully recognizes the importance of the subject, both to the State of Montana and to the Nation. He also admits a dual capacity in committee assignment. But he is not twins, unfortunately. When he is required to sit here for one reason, he cannot be in a committee room for another.

Mr. MANSFIELD. That is understood. I know that the distinguished chairman will give the subject his most serious

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