Address to the U.S. Conference of Mayors in Milwaukee, Wisconsin

More than 40 years ago, President Franklin Roosevelt declared that America's No. 1 economic problem was poverty in the South.

President Roosevelt was right, and he had the vision and political ability to enact programs such as TVA and REA that changed my life and the lives of millions of southerners.

Today, America's No. 1 economic problem is our cities, and I want to work with you to meet the problems of urban America just as Franklin Roosevelt worked to meet the problems of the rural South in the 1930's.

I want to make one point at the outset, as plainly as I can.

There is no room in my concept of the Presidency for the politics of alienation and division.

For 8 years, our cities and their people and their elected officials have too often been viewed by the White House as adversaries and used as political whipping boys.

Too often our highest federal officials have tried to score political points by pitting the suburbs and the rural areas against the cities.

Too often, these administrations have ignored the common interests which unite our local, state, and federal governments.

I pledge to you an urban policy based on a new coalition—recognizing that the President, governors, and mayors represent the same urban constituency.

I pledge to you that if I become President, you, the mayors of America, will have a friend, an ally, and a partner in the White House.

The mayors of America will have direct access to the White House to get prompt assistance on any problems that may arise.

It is time for our government leaders to recognize that the people who inhabit even the poorest and most deteriorating of our central cities are our fellow Americans, and that they want the same things we all want; personal security, a decent job, a good education for their children, opportunities for recreation—in short, the basic American promise of life, liberty, and the pursuit of happiness.

Our goal must be to develop a coherent national urban policy that is consistent, compassionate, realistic, and that reflects the decency and good sense of the American people.

We have never really had a comprehensive urban policy in this country, although we have been moving toward one, in fits and starts, for several decades.

The initial steps came in the late 1930's when we began the first public housing projects. In 1949 we started the Urban Renewal Program. In the 1960's the Anti-Poverty Program and the Model Cities Program broke new ground in urban policy, and gave us some successes, some failures, and much experience to draw upon.

But for the past 8 years we have drifted; we have seen indifference replace experimentation, and divisiveness replace the search for unity that this country so urgently needs.

Between 1972 and 1974 alone, the Nixon-Ford Administrations cut $4.5 billion in urban programs and another $7 billion from programs to aid the poor, the unemployed, and the medically indigent.

The cities, with their revenues already reduced by the worst recession in 40 years, and with rapidly rising costs, could only respond to the financial crunch with higher taxes or reduced services. Thus, in 1957, our cities enacted $1.5 billion in new taxes while reducing expenditures by $1.4 billion. The result of these increased taxes and reduced services can only be to speed the flight to the suburbs and leave behind urban dwellers bereft of the hope for a better quality of life.

In short, in the absence of understanding and coordinated assistance among government leaders, many of our cities are caught in a vicious cycle, a downward spiral that can only be broken by new attitudes, new initiatives, and new leadership.

The time has come for us to work together toward a restoration of federalism, through the creation of a balanced national partnership that is based on mutual trust, mutual respect, and mutual commitment to the future of the American city.

The balanced national partnership I envision must incorporate three basic elements.

First: The federal government must provide predictable and adequate financial support to assist communities in meeting your legitimate fiscal needs, so that localities can avoid excessive service cutbacks and inordinate property tax increases.

Of course, we must be realistic. We cannot just throw money at problems. We must respect the desire of the American taxpayer to get a dollar's worth of results for each dollar spent. But I believe that if we talk sense to the American people, we will find support for a realistic program to meet the urban crisis. That is what I intend to do as President.

Second: A balanced national partnership must, to the greatest degree possible, grant to the local governments the administrative freedom needed for innovative, creative programing.

Between the mid-1950's and this year, the number of categorical grant programs grew from 150 to more than 1,600, each with its own administrative bureaucracy, its own restrictive conditions, individual application procedures, review conditions, and funding priorities.

These categorical grants can often serve important functions. On a program of national dimensions, such grants can maximize local involvement in confronting national problems.

In practice, however, the proliferation of grants has built an irrational structure, which has often limited local initiative and fragmented local efforts toward sound fiscal planning.

It is important to attach conditions to programs which insure that funds are directed toward the beneficiaries intended by Congress and the President. But too often programs designed for the ghetto families have been shifted to further benefit affluent families whose political influence can prevail.

You, this nation's mayors, are the people on the firing line, fighting a hard battle against heavy odds, and we cannot expect you to fight well if you are trapped in the bureaucratic strait jacket that categorical grants have too often imposed.

To achieve a balanced national partnership, I intend to undertake a review, beginning this year and involving full consultation with state and local officials, and congressional leaders, to determine in which instances consolidation of categorical grants would be desirable.

That process of consolidation will insure that the federal structure is organized to allow localities maximum flexibility in delivering services within the framework of national standards. I can insure that consolidation will not be a cover to reduce needed federal assistance, or to change the distribution of benefits so as to discriminate against those individuals with the greatest need.

Third: A balanced federal partnership must involve the governors and the mayors in the earliest stages of formulating our national urban policy, and in the design of new administrative machinery to implement that policy.

Finally, federalism is not going to mean anything until the federal government sets its own house in order. I intend as President to direct a complete reorganization of the Executive Branch of the federal government along rational functional lines, one that will enable Washington to work more effectively with you in responding to the urban crisis.

I look forward with interest to observe similar improvements in municipal government organization and management which you are sharing with one another. We have long recognized that federal tax funds should not finance local waste.

My own views on federalism are not just theories: they directly reflect my experiences in dealing with the delivery end of complicated programs when I was Governor of Georgia.

I learned, along with you mayors, just how confused and irrational the Washington bureaucracy can be. For example, when we started a drug treatment program under one state agency, we discovered there were some 14 different agencies that were funding various aspects of the drug problem, and with little, if any, coordination among them.

But I am absolutely convinced that if we work together on the task, we can come up with a federal system that is effective and efficient and that can be a source of national pride instead of national embarrassment.

We simply can no longer afford the price of the red tape. We must get the money and services to the people who need them, and not just to the communities that happen to be most skilled in the art of grantsmanship.

These are among my beliefs as I consider the urban problem. Now I want to discuss some of the specific programs I support.

The first thing we need is jobs, a job for every American who wants one. Unemployment and poverty are at the heart of the urban problem.

Last year, the central city unemployment rate was 9.6 percent, and among black teenagers, the jobless rate in many areas was over 40 percent. Those figures are unacceptable. They reflect a national sickness that we must confront head on. They reflect not only human tragedies but they axe at the heart of the fiscal and social problems of cities. The only way to achieve the growth in the urban tax base required to meet rising expenditures is through a healthy local economy.

To provide employment, we need both a program of incentives to private employers and a program of public needs employment.

We must recognize at the outset that almost 85 percent of America's workers depend on private industry for jobs. I would like to maintain or improve this ratio.

To encourage new industrial development in the cities, I have proposed assistance to local governments for urban economic planning, employment credits to businesses for hiring the unemployed, and federal funds to support on-the-job training by business.

In terms of public employment, I favor an improved CETA program, an accelerated public works program, and funds for a total of some 800,000 summer jobs. Like some of you, I remember the impact of the CCC and WPA in the 1930's, and I think similar initiatives are called for today, but with stress on urban rather than rural work projects, and with maximum possible local control over those projects. Public employment must be meaningful and productive in meeting the most urgent needs of the community.

Our efforts toward full employment must be supplemented by fiscal assistance, and in particular by an improved program of revenue sharing.

I predicted at the outset of the Nixon Administration's revenue sharing program that it would eventually be used to reduce, rather than increase, net federal assistance to our states and cities. Unfortunately, I was correct.

I stand with you in urging Congress to extend the General Revenue Sharing Program with an inflation factor and with full enforcement of the civil rights provisions of the bill.

As perhaps you know, I have for some time stated my belief, even when I was a governor, that revenue sharing funds should go directly to localities, and that they should be free to use those funds to defray costs of education and social programs.

We also need countercyclical assistance, with revenue sharing and other financial aid designed to meet the special needs of the most hard-pressed urban areas. We need an automatic countercyclical assistance program, with a long-term authorization, triggered by carefully defined economic conditions in particular localities and designed to maintain service levels in our cities and thereby avoid disruptive tax increases and public employee layoffs.

I regret President Ford's veto last year of the Public Works Economic Development Act, with its needed provision for public works, for countercyclical aid to cities and for waste-water treatment plants, and I join you in urging that he sign the new version passed with overwhelming Democratic majorities, which now awaits his action.

The present bill is within the budget resolutions adopted by Congress, and it would not be rejected by a President who genuinely understood and cared about our cities and their people.

In the past year, the dramatic financial difficulties of New York City have been the focus of national attention on urban fiscal problems. But the truth is that cities throughout America share the same problems of declining revenues and increasing costs. Your own 1976 economic report makes that point abundantly clear. For the first time, cities of every size, and in every part of the nation, including the Sun Belt, are face to face with financial crisis.

I think the public at large does not yet realize that what we confront is not just New York City's fiscal crisis, but a national problem. It will be your duty and my duty to make the nation aware of the broad nature of the urban problem, and to provide the leadership and the ideas that can cope with it

Another need in easing urban problems, as I have stressed throughout my campaign, is a complete overhaul of our welfare system.

Our present system is a failure deplored alike by those who pay for it, those who administer it, and those who supposedly benefit from it.

About 10 percent of those on welfare are able to work full-time, and they should be offered job training and jobs. Any such person who refuses training or employment should not receive further welfare benefits.

The other 90 percent of the people on welfare are children, persons with dependent children, old people, handicapped people, or persons otherwise unable to work full-time. They should be treated with compassion and respect.

We should have a simpler national welfare program, with one fairly uniform standard of payment, adjusted for cost-of-living differences by areas and with strong work incentives built in. In no case should the level of benefits make loafing more attractive than working. And we should have welfare rules that strengthen families rather than divide families. Local governments should not be burdened with the cost of welfare and my goal would also include the phased reduction of the states' share as soon as that is financially feasible.

I believe we are competent enough to create a welfare program that is both efficient and compassionate.

We also need Presidential leadership in helping cities meet their housing and transportation needs.

Our worst year in nearly three decades in terms of the number of housing units constructed was 1975. We set a goal in 1968 of 2½ million new bousing units per year; last year we constructed barely 1 million.

At the same time, costs have been rising so that only one American family in six can now afford new housing.

We need a program that will provide jobs for hundreds of thousands of unemployed construction workers and also fulfill our national commitment to adequate housing construction.

Our long-range, comprehensive and predictable national housing policy must include:

• Federal subsidies and low-interest loans for the construction of low and middle income housing;

• Greater effort to direct mortgage money into the financing of private housing;

• Expansion of the successful "Section 202, Housing Program for the Elderly";

• Greater emphasis on the rehabilitation of existing housing to rebuild our neighborhoods and publicly created jobs to spearhead this rehabilitation;

• Continued construction of rental homes for low income families; and

• Prohibition of red-lining practices by lending institutions.

We should give serious consideration to the proposals now before Congress for a domestic development bank that would make low interest loans to businesses and state and local governments to encourage private sector investment in chronically depressed areas.

The Housing and Community Development Act of 1974 can be improved when it comes up for reauthorization next year. If I become President, it will be necessary for me to submit my proposals on this program to Congress very soon after taking office, and I want your ideas and recommendations on how it can be made more effective.

The plight of our municipal transportation systems is another subject for Presidential concern and initiative.

For 20 years, we have spent tens of billions of dollars on the Interstate Highway System while virtually ignoring public transportation. Our bus and subway systems have deteriorated, public use of them has declined, and deficits have mounted.

Although we must expedite final completion of the Interstate Highway System, we cannot allow mass transit to remain a national stepchild. If people cannot get in and out of our cities in comfort and safety, then the economic strength of our central cities is doomed.

As first steps toward revitalizing our urban transportation system, I propose:

• To create a total national policy for all modes of transportation;

• To increase the portion of transportation money available for public mass transportation;

• To change the current restrictive limits on the use of mass transit funds by localities, so more money can be used as operating subsidies:

• To revitalize our nation's railroads.

There is also a tremendous opportunity for relatively inexpensive transportation improvement by strong local action to provide offstreet parking, one-way streets, exclusive bus lines, limited unloading hours for downtown stores, more carpools, and staggered working hours for public and private employees.

These are some of the necessary first steps if we are to deal with the urban crisis. There are obviously other areas of need, such as parks and recreation, education, pollution, and crime prevention, that must also be addressed.

Perhaps most importantly, we must recognize that many federal programs in the past have had a counterproductive effect on the health and wealth of our cities. It is time to assure that federal spending policy takes into account the best interests of our urban communities.

In order to have a comprehensive urban strategy, federal, state and local governments must provide incentives to direct the resources of private enterprise into our cities. Our national urban partnership would be incomplete without the creative involvement of private resources. The public sector cannot rebuild our cities alone. An optimum public-private partnership must be forged.

In this era of scarce resources, the federal government can help magnify limited public sector funds by engaging substantial private sector investment in our cities. As urban economist Anthony Downs noted, "Federal funds alone—and even all public sector funds together—have little chance erf stimulating effective community development unless they are used as a catalyst to attract large amounts of additional resources from the private sector."

The government can also help local communities encourage innovative new structures, such as tax increment financing, which allows a city to use growth in its property tax in a given area to stimulate needed urban reinvestments, and joint public-private development mechanisms.

The Community Development Act should not only be extended, but its scope should be significantly oriented to encourage financial and political innovation by municipalities and their private sector partners. Community development funds, local tax increment financing, federal loan guarantees, and other pubEc and private funds should be used flexibly to create a revolving pool of financial resources for urban redevelopment Unfortunately, the Ford Administration has not yet even implemented a small scale version of the current act, which affords an outstanding opportunity to combine public and private urban development investments.

Privately operated nonprofit organizations committed to urban redevelopment, such as Central Atlanta Progress in my home state's capital, are being formed throughout the country to help serve as a catalyst for private investment in our cities. They must be encouraged in their efforts.

I do not underestimate the magnitude of the problem. But neither do I underestimate the strength and compassion and good sense of the American people, when they are given the right kind of leadership and make up their minds to solve a problem.

A nation that can send men to the moon can meet its urban needs. It is a matter of priorities, of leadership, and of determination.

I think we stand at a turning point in history. If, a hundred years from now, this nation's experiment in democracy has failed, I suspect that historians will trace that failure to our own era, when a process of decay began in our inner cities and was allowed to spread unchecked throughout our society.

But I do not believe that must happen. I believe that, working together, we can turn the tide, stop the decay, and set in motion a process of growth that by the end of this century can give us cities worthy of the greatest nation on earth.

I recall the oath taken by the citizens of Athens:

"We will ever strive for the ideals and sacred things of the city;

"We will unceasingly seek to quicken the sense of public duty;

"We will revere and obey the city's laws;

"We will transmit this city not less, but greater, better, and more beautiful than it was transmitted to us."

Those words are more than 2,000 years old, but they are still valid today. They are your goals, and they are my goals, and working together, we can achieve them. Thank you.