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Letter to Senator Cooper on Federal Programs and Activities in Aid of Chronic Labor Surplus Areas.

January 08, 1960

Dear John:

In response to your letter of December 31, 1959, I assure you that I share your deep concern in respect to areas with substantial and persistent unemployment.

I trust that it will hearten you and others to know that fourteen agencies of the Executive Branch have been contributing either direct or indirect assistance in such areas. The scope of these undertakings has been steadily enlarged. Last year I directed an intensification of these Federal efforts, which, I hope, will provide further help for existing local business and in creating job opportunities and attracting new businesses to these areas.

The substance of existing Federal programs and activities in chronic labor surplus areas range from specialized technical assistance in fields such as area development, small business enterprise, employment counseling and surveys, financial assistance programs of loans and grants for urban renewal, public facilities, state and local industrial development corporations, the procurement of goods and services and construction of government facilities.

In magnitude of impact, the defense and civilian procurement programs are impressive in their contribution to the economies of virtually all of the labor surplus areas.

Among specific examples that have been reported to me, reflecting both the extent and diversity of Federal assistance, are the following:

1. In the last fiscal year when unemployment was a widespread problem, 42.5% of the total procurement awards of the Department of Defense were made in labor surplus areas temporary and chronic.

2. Of these total awards by the Department of Defense, set asides specifically reserved for labor surplus areas amounted to $96 million.

3. Two large operational offices of the Bureau of Census, Department of Commerce, have been placed in labor surplus areas (Jeffersonville, Indiana, and Parsons, Kansas) to prepare for the censuses of population and agriculture.

4. A total of 21 urban renewal projects have been approved by the Housing and Home Finance Agency in chronic labor surplus areas. These involve $58 million in Federal grant funds; 17 projects are under contract for execution and four are in the planning stage.

5. During the 15 month period ending October 1, 1959, the General Services Administration placed procurement contracts totaling over $408 million with suppliers in all labor surplus areas. This represents 62.3% of the total dollar value of contracts awarded during this period.

These examples indicate that the benefits resulting from the Federal contribution in surplus labor areas have been widespread and substantial. Other programs and activities to improve community economic conditions are underway or planned. Two activities in particular deserve mention:

1. A new lending authority of the Small Business Administration provided for by the Small Business Investment Act of 1958 allows the making of mortgage loans (up to $250,000) to state and local development companies for local projects which assist small business. The Act also provides for the licensing of Small Business Investment Companies to provide equity capital and long-term debt funds to small business concerns. Already 24 loans to state and local development corporations amounting to $2.7 million have been approved, and 57 small business investment companies have been licensed.

2. Action has been taken to establish closer working relations between Federal programs and state and local efforts. The Office of Area Development in the Department of Commerce has been channelling Federal technical assistance to state and local groups, including industrial development corporations. This office acts as a clearinghouse on the methods and experiences of communities which have successfully coped with their economic problems.

Increased strength was added to Federal programs last year through creation of an Interdepartmental Committee to Coordinate Federal Area Assistance Programs. This committee has been coordinating the numerous diversified undertakings of the Departments and agencies in urban-industrial regions and now is intensifying these joint efforts.

Members of the Committee include the Under Secretary of Commerce, Chairman; the Deputy Postmaster General; the Under Secretary of Interior; the Under Secretary of Agriculture; the Under Secretary of Labor; the Under Secretary of Health, Education, and Welfare; the Assistant Secretary of Defense (Supply & Logistics); the Administrator of the General Services Administration; the Administrator of the Federal Aviation Agency; the Administrator of the Small Business Administration; the Administrator of the Housing and Home Finance Agency; the Director of the Office of Civil and Defense Mobilization; the Special Assistant to the President for Public Works; and a member of the Council of Economic Advisers.

This Committee complements the long-established Committee for Rural Development Program with which it is working in close cooperation.

Our policy is twofold: Efficient coordination among Federal agencies and full cooperation by these Federal agencies with state and local governments and private individuals and organizations that seek to help areas with substantial and persistent unemployment.

The national economy is at a very high level. We all want people in areas with chronic unemployment to share more in this overall prosperity. Through joint Federal, local and private efforts, which help these areas to help themselves, considerable improvement in regional economic conditions has been realized. Through more intensified efforts of the Federal coordinating committee above described, which I believe meets the purpose suggested by your bill, I anticipate that additional industrial activity can be stimulated and more job opportunities made available.

In addition, as you well know, I have repeatedly urged that the Congress pass legislation which I have specifically proposed to assist areas of urgent need. This legislation would give the government additional authority and finances to help these areas once again to become fully productive elements in the national economy. I am hopeful that the Congress will soon approve my recommendations in this regard.

With warm regard,



Note: Senator Cooper of Kentucky was the ranking minority member of the Senate's Special Committee on Unemployment Problems, and the sponsor of a resolution providing for an interagency task force to formulate plans for the development of the economic potential of underdeveloped regions. His letter of December 31, 1959, emphasized the need for informing communities in areas of chronic unemployment concerning the programs of Federal agencies. The letter was released with the President's reply.

On April 20, 1960, the White House released a preliminary report by the interdepartmental Committee to Coordinate Federal Urban Area Assistance Programs. The report, entitled "Federal Programs of Assistance to Labor Surplus Areas" (55 pages), is in the form of a manual, with index, for use by local officials or private organizations seeking the cooperation of the Federal Government in resolving labor surplus area problems. See also Item 176.

Dwight D. Eisenhower, Letter to Senator Cooper on Federal Programs and Activities in Aid of Chronic Labor Surplus Areas. Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/235009

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