United States. Congress. Senate. Special Committee.

Post-war economic policy and planning. Joint hearings before the special committees on post-war economic policy and planning, Congress of the United States, Seventy-eighth Congress, second session, pursuant to S. Res. 102 and H. Res. 408, resolutions creating special committees on post-war economic (unit 6) online

. (page 46 of 49)
Online LibraryUnited States. Congress. Senate. Special CommitteePost-war economic policy and planning. Joint hearings before the special committees on post-war economic policy and planning, Congress of the United States, Seventy-eighth Congress, second session, pursuant to S. Res. 102 and H. Res. 408, resolutions creating special committees on post-war economic (unit 6) → online text (page 46 of 49)
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It will be noted that our real problem is financing. Under present procedure
our program would be carried out partly by local assessment and partly out of
general city funds. For example, storm sewers, which comprise by 'far the
greater part of the item for sewers and sanitary facilities, are normally payable
two-thirds by local assessment and one-third by tlie city out of its general
funds ; bridges and viaducts are paid almost entirely out of general citv funds-
while highways are borne partly by local taxpayers and partly bv city-wide levy
b ollowmg our normal policy, we would distribute this woVk 'so that several
local assesments would not fall upon a given area at one and the same time
In other words, we are compelled to spread the work out over a period of years'
having ill mmd the fact that the average home owner is not in a position to
absorb the cost of all the contemplated improvements if the obligations thereon
fall due within a comparatively short period. On the other hand, our program
does not contemplate any fanciful embellishments or gingerbread nor are
the improvements proposed ahead of their time insofar as the need for them
IS concerned. As a matter of fact, many of the projects are already overdue and
all of them are necessary and useful.

If we are to expedite the construction of these improvements so as to take
up some of the slack in employment which will undoubtedly occur during the
transfer period immediately after the war and while industry is reconverting
it will be necessary for us to obtain some form of financial assistance. Our popu-
lation of 1,400,000 persons is largely composed of working people. Most of
them own their own small homes. It has been estimated that approximately
1,000,000 of our inhabitants live in one- and two-family houses.

Without help and in the natural course of events, this program would be
scheduled over a period of about 15 years. This is obvious when we consider
that the local assessment share of the cost of the.se improvements is levied on
the basis of the area of the land owned by the taxpavers and we cannot con-
struct except in accordance with their ability to pay. The taxpayers of the
older sections of the city would also benefit by a program of Federal aid for
assessable improvements. For example, one-third of the cost of storm sewers
is now borne by the city at large. Should the Federal Government adopt the
policy recommended by the mayor, of assuming 50 percent of the cost of con-
struction, the assessment against the local landowner would be reduced from
t\vo-thirds to one-third and, at the same time, the charge levied against the
city at large would be reduced from one-third to one-sixth of the total cost.
Thus^ a grant from the Federal Government for these projects would not only
be of benefit to the individual home owner but would also reduce the city's
over-all share, thereby enabling the city to use such savings for other parts 'of
its own comprehensive program.

In my opinion, it would be feasible to complete the construction of this
program within a 5-year period if Federal aid is forthcoming to the extent
previously mentioned. Further, if a national emergency required it, we are
in a position to let contracts for over 50 percent of our 'entire program within
60 days.

Federal aid is necessary if we are to do this as otherwise we would have to
wait upon the ability of the real-estate taxpayer to pay, Federal aid is justified
because postwar unemployment, with its impact upon our national economy, is
a matter of Federal concern. Federal aid is reasonable because Federal taxa-
tion is predicated upon the 'ability to pay and it is, therefore, fair to ask that
the cost of meeting a national crisis be borne in accordance with that ability to
pay.



POSTWAR ECONOMIC POLICY AND PLANNING 2059

Furthermore, all work done in the city of New Yorlv will reflect in increased
purchasing power throughout the Nation. Tliis is best illustrated by pointing
out that all of the iron and steel products entering into this construction will
very likely originate in iron-producing areas such as Minnesota and will be
rolled and" processed in Pennsylvania. Clay sewer pipe will come out of New
Jersey and Ohio. Brick will come from Pennsylvania, Ohio, and Connecticut.
Cast-iron pipe and fittings will originate in Alabama and New Jersey. Lumber
will come from INIichigan and Oregon, and the lumber will be milled in almost
every State in the Union. Asphaltic products will come from Louisiana, Okla-
homa, and Texas. Copper and brass products will be produced in Connecticut.
I could go on indefinitely. This purchasing power will expand throughout the
Nation and since the natural resources and manpower of 'almost every State
will be utilized in some form or other, it is simply another reason why the Federal
Government should assume its rightful obligation in advancing the projects,
as the benefits will be far reaching, not only from a municipal standpoint but
also insofar as private industry is concerned.

We all know that this transition period for our industry is approaching.
There are those who would wait until it is upon us and then clamor for another
WPA in some form or other to relieve the unemployment. This would simply
be an expedient and would not only increase the taxpayers' burden but would
offer no stimulant to industry. Our service men and women are depending upon
us to see that 'a realistic program is prepared and ready to function during the
period of reconversion.

I know that the Federal taxpayer is already greatly burdened due to the cost
of the war, but we are dealing with a period when the war will be over and, in
my opinion, the suggestion already advanced that the cost of 20 days of warfare
be devoted to warring upon unemployment is not too much to ask. It will still
leave room for a timely reduction in Federal taxation.
Very truly yours,

James A. Bueke,
President of the Borough of Queens.



Exhibit No. 4

State of New York,
Depaetment of Commerce,

Alhany, AtiguM 14, 19Jf^.
Hon. Walter A. Lynch,

House of Representatives, Washington, D. C.

Dear Congressman Lynch : I appreciated the opportunity to appear before
the subcommittee in New York on July 27 and to discuss the postwar public
Avorks planning program of New York State.

In response to your request, I have obtained from the staff of the iwstwar
public works planning commission the enclosed data concerning progress on
municipal projects aided by the State and on the State program. It should be
noted that the municipal projects reported here do not include those with which
municipalities have proceeded without St'ate aid. Consequently, a large part
of the New York City pjv gram is not reported here and those plans progressing
without State aid in otb.'r communities are not included. In addition, it should
be recognized that the State projects reported include a number which have not
I ;en financed by the postwar public works planning coir.iaission, but which have
progressed in accordance with other legislation.

In sunnn'ary, the combined State program sufB-i-iently advanced to report on
here, plus the municipal program involving State aid, totals some $700,000,000;
design has not yet been started on approximately $300,000,000; preliminary
plans are under way with some $130,000,000; preliminary plans have been com-
pleted and final plans are under way with some $190,000,000; and final plans are
complete for roughly $100,000,000.

These data are the best available as of August 1, 1944. It is expected that
progress on completion of plans in the future will be relatively rapid because
so much of the preliminary work involved in a program of this kind is now out
of the way. If a further break-down of these data or additional information
would be helpful to you, I would be glad to obtain it for you.
Sincerely,

M. P. Catherwood.



2060



POSTWAR ECONOMIC POLICY AND PLANNING



NEW YOKK STATE POSTWAR PUBI IC WORKS PLANNING COMMISSION

Stmimary of State and tminicipal posttvar projects sponsored by commission,

Aug. 1, 19U





Municipal


State


Total




Number

of
projects


Amount


Number

of
projects


Amount


Number

of
projects


Amount


Desisjn not started


SIR

367

1,880

111


$72, 353, 000
37, 237, 420
88, 975, 396
8,448,876


621 il!521 7nn 295


1,4,37
720

2,105
433


$294, 053, 295
132, 485, 201
188 207 154


Preliminary plans underway

Final plans underway '


353
225
322


95, 247, 781
99, 231, 758
86,843,039


Plans completed...


95.291,915




3,174


207, 014, 692


1, 521


503, 022, 873


4,695


710, 037, 565



' Includes New York City State-aided program.



Exhibit No. 5



American Society of Civil Exgineers



COMMITTEE ON POSTWAR CONSTRUCTION



Since January 1, IMS, a total of $11,422,839,000 in proposed postwar construc-
tion plans has been reported l)y Engineering News-Record. During the same 18-
month period only $3,259,510,000 has been reported in the design stage. Compre-
hensive data concerning the percentage of plans in the completed stage and
actually ready to advertise for bids are not yet available.

The increase over May 31, 1944, in the volume of plans underway amounts to
$604,252,000 or about 23 percent. However, $331,000,000 of this sum, or over
half, is for Federal earthwork projects in the State of California.

In volume of total engineering plans in the design or completed stage for
postwar construction, the following 12 States are leading in the order listed :

(1) New York (7) New Jersey

(2) California (8) Michigan

(3) Ohio (9) Maryland

(4) Texas (10) Indiana

(5) Washington (11) Connecticut

(6) Pennsylvania (12) Oregon

Oregon in twenty-fourth position last month is now the twelfth State with a
reported increase in volume of plans of $51,259,000.

Michigan increased her volume from $71,142,000 to $96,067,000, moving from
eleventh to eighth positioiL

SANITATION

Waterworks projects total about $230,000,000. an increase during the last
month of 36 percent. This type of work represents about 7 percent of the entire
volume of engineering construction now in the design stage.

Sewerage projects repre.sent 9.8 percent of the total of all planned construc-
tion. The increa.se since May 31, 1944, being $14,6( 0,000, or 4.8 percent.

No plans are reported from 16 States for waterworks and none from 19 for
sewerage.

HIGHWAYS AND BRIDGES

Streets and roads in the design stage total approximately $750,000,000 with
$571,000,000, or 71 percent being reported from only nine States.

Specific data on postwar highway plans have not been released in 21 States.

Bridge projects are reported in only 28 States and 5 of these have 48 percent
of the total volume of $334,655,000.

Streets, roads, and bridges combined represent about one-third of all engi-
neered construction in the design or completed stage as of June 30, 1944.



POSTWAR ECONOMIC POLICY AND PLANNING



2061



PUBLIC BriLDlNGS

A fair-sized program of public buildings is being planned with little or none
being Federal sponsored. The total of $521,000,000 is well distributed geo-
graphically although the major portion is reported in the mid-Atlantic and
Midwest States.

PRIVATE CONSTRUCTION

During the years 1925 to 1939, private construction averaged about 48 per-
cent of civil engineering construction, in a postwar civil engineering program
of $10,000,000,000 this classilication should total approximately $4,800,000,000.
At present, $111,870,000 worth of private projects is reported which is only 2.3
percent of the postwar potential and 3.4 of all engineering construction.

Mark B. Owen.



Postwar construction plans under way or completed, July 7, 1944 ^

[Thousands of dollars]



State



Arkansas

California

Colorado

Connecticut

District of Columbia-
Florida

Georgia

Illinois

Indiana

Iowa

Kansas

Louisiana

Maine

Maryland

Massachusetts

Michigan

Minnesota

Mississippi

Missouri

Montana

Nebraska

Nevada

New Hampshiie

New Jersey

New York -..

North Carolina

North Dakota

Ohio

Oklahoma

Oregon

Pennsylvania - .

Rhode Island

South Cai-olina

Soutji Dakota.

Tennessee.-

Texas

Utah

Vermont

Virginia

Washington

W^isconsin



Public works projects



Water- Sewer-
works



,390
270

290

,540

25



068



338



213, 155



5,066

1,989

15, 054



31,195

13, 606

2,591

200



100
14,258
14,410
4,871
3,024



600

2,180

621



6,995
50, 624



240
60, 773



14, 197

4,432

390



2.152
18, 656
6,134
4, 305
145



8,664
8,844



Roads

and
streets



68, 436



Bridges E-th.



Build-
ings



25
3,879 333,000 33,443 1,636



63, 0001 997
12, 600 5, 950! 2,
9, 149 5, 23



Un-
class-
ified



1,300
27, 346
3,042



225
2,222
4,846



25



42, 707

100

36, 861

8,228



7,256



20, 000
3,890



58, 520
88, 690 100,
100



63, 060



10, 145
63, 037



600



11,500
40, 893

8,808

150

14, 000

82,299

3,872



535
,578



80
'820



151 6, 570; 1,

500| !

400! 16,



,840

30

800



317|
400!
700
090
075
400



20, 000



1,650



,515
350
,385
,414
5,284:210,758

_! 800

200
,675



530;
829; 75,



,382,
370



162, 400



,356
200
238



17, 705
260



9,357



Private projects



Buildings



In-
dus-
trial



170



1,200
400



40



150
40



45

12, 150

40



387
""280
2," 545



944



3,500
950



Total 229, 676 318, 177 749, 589 334, 655 589, 703,523, 908 401, 932|22, 961 80, 844 8, 065 3, 259, 510



Com-
mer-
cial



750

700

2,130



2,250
350

3,550
988
150
200
475

3,730

5,740
550

7,000



8,640
'""250



150
3,550
12, 124

8,625



4,650
3,500



362
2,210



500
6,150



500
1,070



Un-
class-
ified



2,475



4,025



1,500



Total



25

464, 314

2,497

79, 990

32,469

61,331

4,650

41, 390

86, 586

14, 180

4,090

225

1,475

90, 997

58,710

96, 067

65, 077

150

40, 635

57,420

31, 187

8,740

3,646

96, 602

781, 194

9,665

2,190

385, 760

30, 375

65, 770

106, 134

5,984

1,560

1,712

32, 611

295, 149

17, 788

1,195

17, 580

111,228

51,163



' Engineering News-Record statistics.



2062 POSTWAR ECONOMIC POLICY AND PLANNING

Exhibit No. 6

POSTWAR ECONOMIC POLICY AND PLANNING

(Statement by Robert Moses, chairman of Triborongh Bridge Autliority)

Whatever the yardstick, the magnitude of the coming postwar dislocation of
spending and employment is staggering. Congress, wliich knows the figures
seems not to realize their importance. Compare tlie current and last prewar vear
National income is 142 billions as against 95 billions. Of the present enormous
total, some 86 billions represent Government spending. Employment today
including the armed forces, is 62 millions, as against a 52 prewar top If Gov-
ernment spending drops swiftly, how much income and employment can business
make up, and how quickly? The best we can possibly expect^s a national post-
wai- income of 120 billions and employment totaling 50 million people

The Committee for Economic Development and other optimists tell us that as
^^^"/^? Y''^^". ^^'^^^'^ ai'e completed, defense contracts wound up, and conversion
ettected, business will immediately absorb all those seeking employment because
of accumulated savings, expansion of plants, experience in mass production of
niunitions, new incentives, boundless conlidence in the future, and finally because
of the tremendous, unsatisfied demand for all kinds of goods and services These
people claim that the real problem is to control inflation in the face of abnormal
purchasing power and extreme shortages of consumer goods. The some groups
overemphasize the effects of technological improvements and argue that enor-
mous additional employment will immediately be afforded through developments
m the fields of metals, plastics, aeronautics, electronics, television, power pre-
tabrication, etc. Technical improvements do not ahvavs increase emplovment
and in any event it takes time to get them into mass production. They belong
therefore, in the class of post-postwar stimulants. Similarlv, the notion that
many millions of new cheap houses with all the latest gadgets" will be built right
after the war is sheer nonsense. Most people who have the means and the ambi-
tion will repair, repaint, and refurnish their present homes rather than build new
ones.

We cannot afford to minimize the difficulties of conversion and the time re-
quired for retooling. Business needs capital. It must be guaranteed opportuni-
ties tor expansion in a friendly atmosphere. It must be reliably informed in
advance as to the rules of the game, so that it will not be subject to the whims
and vagaries of politics. Small business particularly needs restoratives, but
direct Federal loans with the inevitable Federal control can't revive small busi-
ness. That is what the local banks and loaning agencies are for. Perhaps a Fed-
eral guaranty for local loans on the FHA model is the answer.

Labor must be assured of proper awards in the form of high wages reasonable
hours, increased leisure, and a fair share of profits of all kinds. Taxpayers must
be promised an embargo on exorbitant and punitive tax rates which would make
both saving and spending impossible and throttle private enterprise. The debt
must be retired as prosperity increases and must not be a millstone around the
necks of those who are trying to get on their feet after the shock of war. Relief
abroad must be on a generous scale, but rehabilitation and reconstruction must
not exceed our means. Immigration must continue to be reasonably restricted
so that we will not aggravate our own domestic employment problem^

Another assumption which must be examined criticallv is that increased for-
eign trade will immediately stimulate domestic employment. The average Ameri-
can's approach to international cooperation is friendly, but conservative. He is
not a free trader in the sense that he is willing to lower American wage and liv-
ing standards to redress the balance in other countries. He is not willing to de-
pend entirely on foreign countries for strategic materials and to risk the cutting
off of these materials in another war. The average American is for international
economic and political cooperation, but he regards these as ultimate objectives
and does not favor the adoption of an international planned economv. He believes
that God still helps those who help themselves and that full employment like
charity, begins at home.

Given time and favorable conditions, we can produce in unprecedented abun-
dance the countless benefits of a mechanized civilization, but it can't be done in a
few months. There is a yawning gap which must somehow be bridged. A tough
transition period will precede the new era of full emplovment. No responsible
person can afford to be dogmatic about the length of this period, but it may safely
be assumed that it will last 2 years, beginning with the end of the European war
and depending to a considerable extent on the length and severity of the far



POSTWAR ECONOMIC POLICY AND PLANNING 2063

eastern campaign. Given a reasonable amount of time, I do not question the
initiative of our people nor the resiliency of our American economic system. It is
the interval which concerns me, because in that period the entire outlook on life
of the generation which fought the war will be determined. Two years of buf-
feting about and pillar-to-post job hunting will result in disillusionment, cynicism,
and reeouiTse to the desperate remedies which have always been the stock in trade
of demagogs and agitators. Mustering-out pay and similar expedients are no
substitute for jobs.

In the transition period business cannot possibly absorb all of those looking for
jobs, no matter how highly we estimate savings, enthusiasm, pent-up consumer
demand, and the urgent need of all kinds of repairs. Millions of men discharged
from the armed forces and industry must be employed by the Government on
worth-while public works, relegated to work relief or the dole, or taken care of
through tremendous soldier and security benefits largely j)aid out of the Public
Treasury and involving a crushing burden on busine&s in the form of direct and
indirect taxes.

We do not even know what the men in the armed forces want to do when they
are discharged. The TYar manpower and draft authorities tell us rather glibly that
jobs for servicemen will be taken care of by the draft boards, which are ready at
a moment's notice to go into reverse and to become branches of the employment
service on what is called D or demobilization day. On the other hand, tho.se in
charge of the draft machinery frown on the suggestion that they make
a canvass of men in service to see what sort of jobs they actually want when they
get home. They say that such a canvass is too complicated and would produce
nothing of value. It is ditficult, however, to understand why machinery estab-
lished to enable soldiers to vote in a Presidential election cannot be used to find
out what the same soldiers want to work at after the war, a matter which from
all accounts concerns them much more vitally.

It is true that a sound public-works program, consisting only of needed repairs,
reconstruction, and improvements and carried on by contract instead of work
relief, is not likely to employ at the scene more than a maximum of 5,000,000
men at any time during the transition period, but back of these men are millions
of others in mines, mills, factories, transportation, and management whose
temporary employment in this pei'iod will enormously help business recovery.
The public-works program should be flexible. It should be adjusted to regional
demands. It should not compete with or elbow out private employment but
should supplement it. Even a comparatively modest works program will be
difficult to achieve because of lack of funds, delays in the preparation of detailed
specifications, inability or unwillingness of municipalities and States wholly or
even partly to finance either plans or con.struction, absence of a definite policy
as to Federal grants, and the difficulty of getting the Federal, State, and local
governments together on a comprehensive program. It was precisely this situa-
tion which, late in 1933, led to the establishment of the CWA and its successors.
We had to accept a makeshift relief program because we were not ready for
contract work on a large scale and had nothing better to offer. It is. however,
fact, and one which believers in a public-works program must face, that out of
$60,000,000 made available by Congress many months ago for highway plans on
the basis of matching SO-HO by the several States, only a fraction has so far
been spent. I would suggest, therefore, that the proportions of Fedei-al and local
design contributions be changed to 00 percent Federal and 40 percent local.
Even this will be futile luiless there is a definite promise of substantial Federal
contriluitions to construction as well as to design.

Not long ago a writer of financial articles described me as a very badlv informed
gentleman because I advocated a conservative works program to supplement the
revival of private business. The main argument on which this critic based his
conclusion was that accunuilated savings in war bonds, bank deposits, and cash
and enormous State unemployment i-eserves would tide over the average fanuly,
and that therefore all those out of work need not fear an extended unemployment
period. It seems incredible that any responsible person would make this argu-
ment. If the owners of war bonds, many of them of the cumulative savings type,
cash them in before they are due, draw out their bank deix)sits, and spend their
cash, we will have the finest financial mess this country has ever seen. As to
unemployment reserves, it is theoretically true that su'^'h reserves are ai^equate
to pay $20 a week to 5,000.000 persons for over a year if we don't mind taking
the last penny out of the till. Practically, however, the statement is false because
under existing laws It is impossible to pay $20 a week to any person for a year.
The average maximum of benefits over ail the States of the Union in 1 vear is
less than $295.



2064 POSTWAR ECONOMIC POLICY AND PLANNING

It is all very well to deprecate in principle a deficit economy and to char-
acterize every Government expenditure as waste. P^r example, large manu-
facturers of motorcars who warn against Government spending propose to turn



Online LibraryUnited States. Congress. Senate. Special CommitteePost-war economic policy and planning. Joint hearings before the special committees on post-war economic policy and planning, Congress of the United States, Seventy-eighth Congress, second session, pursuant to S. Res. 102 and H. Res. 408, resolutions creating special committees on post-war economic (unit 6) → online text (page 46 of 49)