Statement by the President Upon Signing the Flood Rehabilitation Act.

I HAVE today signed H.J. Res. 341, the Flood Rehabilitation Act, 1952. This act provides $113 million for the purpose of providing further Federal assistance in rehabilitating disaster and flood-stricken areas--particularly the flood-devastated area centering in Kansas and Missouri.

This money has been badly needed to help restore farms, homes, and businesses hard hit by the floods in the Midwest last July. I believe the Federal agencies concerned with relief and with rehabilitation in the flood area have done a good job with the limited funds at their disposal. This act will allow them to care for some of the needs they have so far been unable to meet, and I am glad to be able to approve it.

At the same time, I regret very much that the Congress did not provide more help for the people of the flood-devastated area. This act falls far short of my recommendations for a realistic rehabilitation program-recommendations which were based on the on-the-spot surveys and judgments of Federal, State, and local officials.

The bulk of the funds provided by this bill--$90 million--may be used only for loans. I expect the Federal agencies to whom these loan funds are made available-the Department of Agriculture and the Reconstruction Finance Corporation--to make loans on liberal terms to those who need it most, in keeping with the emergency situation that prevails in the flood area. But I fear that there will be thousands of wage earners, small farmers, and the owners of small businesses, whose losses in the flood represented personal financial tragedy and who cannot qualify for loans. I recommended a program of limited rehabilitation grants which would have assisted such persons; this bill unfortunately will give them little or no help.

I am particularly disappointed that this bill includes no provision for making a start toward a satisfactory system of flood insurance. Because insurance protection against flood losses is now virtually unobtainable from private insurance companies, I recommended a system whereby the Government would establish a reinsurance fund, which should make it possible for private companies to write flood insurance at reasonable rates. While the risks of floods in any one area may require prohibitive insurance rates, it is quite possible to reduce the risks and the rates by a nationwide pooling system. Until such a system is developed and put into effect, we shall continue to face the danger that floods may wipe out overnight the savings that homeowners, farmers, and businessmen have slowly accumulated over a period of years.