PROTEST AGAINST SOVIET PERSECUTION OF JEWS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP67B00446R000400170003-7
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 4
• Document Creation Date: December 16, 2016
• Document Release Date: June 28, 2005
• Sequence Number: 3
• Publication Date: September 29, 1965
• Content Type: OPEN

24532
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CONGRESSIONAL RECORD - HOUSE Septem er 29, 1965
drawing on the fine presentation by the Mr. FARBSTEIN.- Mr. Speaker, it is
Department of the Army over the last with virtual disbelief that I read reports
year of its special training enlistment on the prostitution of justice that is cur-
program-STEP. The purpose of the rently being perpertrated in Haynes-
STEP is to increase the number of vol- ville, Ala., where a local man is being
unteers accepted by the Army without tried for the slaying last month of Jona-
lowering standards. The Army proposes than M. Daniels, a ministerial student
to give educational training to some vol- and civil rights worker. Judge T. Werth
unteers for enlistment in the Army who Thagard is clearly engaged in the most
are {row being turned away because they flagrant prejudical action in order to
do not meet Army enlistment standards. achieve an acquittal for the accused man, eman.
e If the extra training or treatment brings Thomas th L.
rose cut on Thdelaye perhas
p
to carry out a special educational
training program for enlistees and
draftees in the Armed Forces who
would otherwise fail to meet minimum
requirements because of education de-
ficiencies, but who can be brought up to
the necessary minimum educational
standards.
The facts supporting my bill are evi-
dence for the need to train those numer-
ous young men who are rejected for mil-
itary duty because they cannot meet the
required mental qualifications and
d Forces
A
.
rme
standards of our
About one-third of all young men who 3-year tour; if a man fails to achieve the
afted for Mils-' Army's standards, he will be discharged.
d
h
r
o are
volunteer and w
tary service are rejected because of The weakness of the STEP program is
mental and educational deficiencies. that its future is in doubt because of
This is alarming when we realize that lack of specific authorizations by Con-
many of the most brilliant and promising gress and because it does not apply to
of our young population are now fighting draftees or to any service except in the
a war in Vietnam, and things are not on Armhis productive program should cer-
the rosy side in other parts of the world:
Southeast Asia, Latin America, and the tainly be made available not only to
always potentially explosive West Euro- those volunteers who enlist for 3 years
pean theater in the regular service, but also to draf-
Du seal year 1964, according to tees who must serve 2 years in the Armed
the Secretary of the Army, over 181,000 Forces. It should also most certainly voluntee young men r Army. red for
available to other services, not
About 11 s ment in be the Army.
the Regula all mental, and physical, and moral In a recent Gallup poll, some 83 per-
standards. Of the 69,900 who were re- cent of those responding to a poll favored
jetted, 700 failed because they could not a program requiring all physically fit
meet moral standards or because they young men who cannot pass an educa-
lacked both mental and physical mini- tional test to serve for. at least 1 year
mum qualifications. in some other form of military service.
Some 56,600 volunteers were turned This indicates the mood of the country
down last year because their mental test to retain these rejectees in the service.
scores were too low. This is shocking and My bill would help train these young
something must be done. men for useful military service.
I. propose that of these mental rejec- Mr. Speaker, I am hopeful for early
tees those who can be trained for use hearings on my bill which would do
and away with a great annual waste of po-
sc midtary service,
beduuracattiononal anre- d tential military talent, and make them
they may the e better citizens of our Nation and better
schooled quirets so that basic
miniinimmum m requirements that of the e Armed able to serve themselves and their fami-
Forces, and be retained in the service to lies.
fulfill their military obligation. This is The bill H.R. 11153, as introduced, fol-
not a social or antipoverty experiment. lows: H.R. 11153
This is securing America's future by ex- A bill to authorize the Secretary of Defense
padding our pool' of able-bodied, men- to carry out a special educational training
a man up to the enlistment standards, deny
Morr he will then serve out the balance of a mit Father +wii h Danie sr to give testi-
t
s
h
ally sound young men to keep the peace. program for enlistees and draftees in the +
My legislation is needed to authorize
the Secretary of Defense to proceed with
this program, after appropriate congres-
sional hearings by the Armed Services
Committees and the Appropriations Com-
mittees of both the House and the Sen-
ate. Full hearings on this bill will estab-
lish this program as a military training
program vital to our Nation's security.
In working on this legislation I have
had the benefit of the wide experience of
Mr. Frank D. Bisbee, chairman of the
board of the Bisbee-Baldwin Corp., of
Jacksonville, Fla., who served for many
years as chairman of the selective serv-
ice board in my hometown. I was greatly
impressed by his concern that many
young risen of apparent strength, energy
and mental intelligence were being re-
jected for military service. Either the
standards were too high, or these young
men lacked the educational training to
make them good soldiers.
In support of this legislation I am
tion. The period of such educational traifi-
ing shall be counted as a part of the obli-
gated service of each such enlistee or draftee.
There is hereby authorized to be appropri-
ated such sums of money as may be neces-
sary to carry out the provisions of this Act.
JUSTICE DEPARTMENT SHOULD IN-
VESTIGATE RACIAL MURDER
CASE IN IIAYNESVILLE, ALA.
(Mr. FARBSTEIN asked and was given
permission to address the House for 1
minute.)
o was
w
mony favorable to the prosecution.
Father Morrisroe is still hospitalized
from his wounds. I cannot fail to ob-
serve that there was a day when south-
ern justice depended largely on all-white
juries to grant acquittals for racial
crimes. It seems clear to me now that
southern courts are not even going
through the motions of dispensing justice
fairly. The trial in Haynesville and
other recent examples of southern judi-
cial procedure suggests that the State
judiciaries have flung defiance at the
Nation in order to protect the most vi-
cious agents of the white supremacy sys-
tem. I implore the Justice Department
to seek out the power to prevent this out-
rageous judicial approval of racial mur-
der.
ARCHBISHOP-ELECT PHILLIP M.
HANNAN
(Mr. BOGGS asked and was given per-
mission to address the House for 1 min-
ute.)
Mr. BOGGS. Mr. Speaker, I take this
time to announce to the House that one
of the distinguished clergymen from the
Washington diocese who preached the
funeral oration for our late beloved Pres-
ident Kennedy, Bishop Hannan, has been
OTEtST AGAINST SOVIET
PERSECUTION OF JEWS
permission to address the House for 1
minute.)
Mr. ANNUNZIO. Mr. Speaker, on
February 4, 1965, because I felt there was
a pronounced and continuing need for
America to express itself against Rus-
sia's persecution of its Jewish citizens,
I introduced in the Congress House Con-
current Resolution 177.
Last March, in a speech delivered from
the floor of the House, I spoke out against
the Soviet Union's abuses of its Jewish
subjects. We are now in the midst of
the High Holy days of the Jewish
religion, Rosh Hashana and Yom Kip-
pur. There is no more appropriate time
than this to remember the Jews in the
Soviet Union who cannot observe these
holidays, and once more, my distin-
guished colleagues, I fervently appeal to
you to join me in publicly condemning
the actions of the Soviet Union.
Persecution in the Soviet Union is by
no means an innovation. As far back as
the 1800's, Russians isolated the Jews in
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September 29, 1965 CONGRESSIONAL RECORD -- HOUSE 24531
it the Vice President hopes to pitch the 'TRIBUTE TO THE LATE SENATOR He soon began making his presence
first ball in the World Series. This is a ELMER THOMAS OF OKLAHOMA felt. He served as chairman of the In-
,natural desire because the Twins are his s
,natural desire team for which he feels par (Mr. PATMAN asked and was given than Affairs Committee, on the Commit-
donable pride. permission to extend his remarks at this Ae ro Agriculture and ommittee, tee, the the Lib the
rar
But there is a rumored snag. The point in the RECORD and to include Committee, and became chairman o
f chairman of a
President is expected to pull rank on the extraneous matters.) a
Vice President and is expected to ask to Mr. PATMAN. Mr. Speaker, I rise to special Committee on Silver.
throw the opening ball. The President, pay tribute to former Senator Elmer Besides the prominence he took
in all probability, feels it his "solemn Thomas, who at the age of 89 passed away a
wh of rose and the was ace r him currency
obligation" because of tradition, and his In Lawton, Okla., on September 19. speak wa ho
good word word as a for chanc silver, e for him keen enthusiasm for sports. The fact The State of Oklahoma and indeed the hard speak in a of the
that 95 percent of all television sets in Nation have lost a great champion of ct of his c uSubcommittee s chairman e the
the country will be tuned in at that par- democracy. He was an outstanding District Columbia Appropriations Committee of _
tieuiar time, of course, has nothing to do patriot and citizen. pre Aa great ppropriations part in shan. the lso
with the decision. As an ardent silverite, he was deeply atio played n bills for the sping thap-
the Army, Navy, and
Mr. Speaker, if, indeed, it is true that concerned with finance and agriculture Interior.
these two great public figures are dead- and widely known for his advocacy of the H
locked on the right to throw the first ball, Patman bonus bill with its greenback He was a strong force in the New
I locked realize it is presumptuous of me, a Re- clause. fairs, and was an airs, a riIndie, af and
publican freshman, to offer a solution. It has been said by many of his friends , financial affairs, agrculture, and
however, since no one else has Coyne that he owed his success to his watchful- oil.
forth Quiet and dignified in his bearing,
with a workable solution, I would ness over the little things. Instead of fol-
fee to mthe following ooposal in lowing the procedure of the destruction- serious and studious, he was credited
their In make a of good lowinmpropop inn ist, who merely makes little things Out of with a social temperature that made his
fhir play: That the President throw and big ones, he had the knack of assembling relationships cordial.
first ball out of deference to his office the minutiae and converting them into
f the Senator complexityo Thomas of trove eon orderliness
and the fact that he might turn off the life-size achievements. Several might be governmental ass
lights if it is cloudy.or a night game. metioned: one of them a 1,000-acre;park, have. fairs had Few the a capacity of the Co wide
legislative infor o widde a
Vice President ,or aREY, by the way another a State capitol building, range of legislative interest.
t.
of compensation
d Indiana was Senator Thomas' bi
could be made thi
th
,
r
-
r
base coach, a job he is eminently quali- place, but he was a prominent Okla-
fled to hold. There he could secretly call roman before Oklahoma's own first
signals and at the same time keep an birthday as a State. From his farm
eye on left field where his friends play. home in Putman County, Ind., where
it is hoped that neither be allowed to he was educated in the common schools,
umpire, since 'a "something for every- he went to the Central Normal College at
one" attitude could only lend frustra- Danville, but not until after he had saved
tion for pitcher and batter alike. In fact, enough to carry him through by working
it might disrupt the entire game. on farms, in public works, and finally
in this connection which has no founda-
tion in fact: That is, that the junior
Senator from New York, formerly from
Virginia, formerly from Massachusetts,
would like to play. I am told by an un-
impeachable source that he is not being
considered because if.he got to third base,
even by running for someone else, it is
doubtful that he would know for sure
which plate was home.
ROBERT M. HARRISS PAYS TRIBUTE
Mr. Speaker, a good patriotic Ameri-
can, Robert M. Harriss, of New York,
was one of Senator Thomas' most ardent
supporters. His letter to me concerning
the death of his long-time friend, Sena-
tor Thomas, is self-explanatory:
FOREST HILLS, N.Y., September 21, 1965.
Hon. WRIGHT PATMAN,
House Office Building,
After graduating from college, he en- WI)E R WRIGx : I was deeply grieved tered De Pauw University at Greencastle, of our old friend, Senator Elmer Thomas'
where he was graduated in 1900 with the death. He was a patriot, loved God and his
degree of A.B. He was admitted to the country and fellow man.
Indiana bar and turned westward. He Senator Thomas and you led the fight
spent a few months in Oklahoma City and in Congress for monetary reform which re-
then moved to Lawton which became his suited in our country getting off the old ruin
??
home. one, gold basis of $20.67 for the dollar. This
In the broke the devastating depression of the early
years up to 1907 when Okla- 1930's. In fact it was the only major legis??
homa achieved her statehood, Elmer lation at that time which was upheld by
Thomas became a more and more
the Supreme Court
rams
p
-
as constitutional.
neat figure in the community and when, I still remember well the unwarranted
CIVIL i ERVICE COMMISSIONER out of the, bitter controversy that arose abuse and smearing that you both took:
(Mr. NELSEN asked and was given over the choosing of the first State sena- for your patriotic efforts.
permission .to address the House for 1 for a compromise was agreed upon, the With all good wishes,
rising young lawyer minute and to revise and extend his found himself the ROBERT M. HARRISS.
) fortunate man
remarks
El
t
d
.
.
ec
e
to the State
Mr. NELSEN. Mr. Speaker, I wto- senate he threw himself into the legis-
relative to ker, will t the lative activities with the same zeal and
day release a statemeSpea
application added activity of the Civil Service private which he had shown fn known
Comnlissioner, Mr..Macy. It is my under- as an vate affairs. He parliamthsoon ban. known
standing that he has now joined the His as first expert the ri
Arm-Twisting Corps. He is Chairman was step into te national arena
of Represent-
of the Civil Service Commission, and he elves election n tto the
al onal p es
NationHouse
has in addition to this responsibility been entirely strange to him when were not
n he entered
endeavoring to recruit qualified persons Congress. At the beginning of World
for appointive positions on behalf of the War 1, against great obstacles, he was
President of the United States. prominent in the establishment of one
In view of the fact he has failed to of the 16 great national training camps
enforce the civil service laws under his at Fort Sill, Okla.
charge, I would suggest to the Commis- In the House he served on the Claims,
sioner that he search for a new man to Public Lands, and Roads Committees.
fill the job of Chairman of the Civil In 1926 Elmer Thomas was elected to
Service Commission, one who will prop- the U.S. Senate where he served with
erly interpret the law, and will enforce it, distinction for 24 years.
LET'S EDUCATE MILITARY RE-
JECTEES TO HELP SERVE THE
NATIONAL DEFENSE EFFORT
(Mr. BENNETT asked and was given
permission to extend his remarks at this
point in the RECORD and to include ex-
traneous matter.)
Mr. BENNETT. Mr. Speaker, I have
introduced legislation in the House of
Representatives which I feel is long over-
due, and is essential to our national de-
fense effort in these times of crisis
around the world. I also feel it can im-
prove the fairness of military obligations
and improve the educational attainment
of trainable persons.
The bill I have introduced, H.R. 11153,
would authorize the Secretary of De-
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September 29, 1965 CONGRESSIONAL RECORD - HOUSE 24533
ghettos and periodically raided these vil-
lages and killed and tortured thousands
of Jews. It was necessary not only for
the Jewish citizens, but for their religi-
ous leaders, the rabbis, to keep arms in
their basements to protect themselves.
It is true we do not hear of murders of
Jews today but religious discrimination
continues to exist in Russia. During the
week of September 13, I attended a con-
ference given by the National Vigil for
Soviet Jewry and I heard witli horror
and anguish the discrimination, repres-
sion- and bigotry to which the Jewish
people in Russia are being subjected.
Let us join in urging Russia to extend
to the Jews the same rights and privi-
leges enjoyed by other. Soviet national
and religious groups, to enable Jews to
participate once more in their cultural
traditions and in their communal in-
stitutions so that these traditions and
institutions may be enhanced and per-
petuated, to permit the local manufac-
ture, import, and distribution of religious
articles which are vital to Judaism, to
permit Soviet Jewry to maintain religious
and cultural bonds with Jewish com-
munities abroad, to permit Jews whose
families were ruptured by the Nazi
catyclysm to reunite with them in other
lands and to use every other possible
means to eliminate anti-Semitism in the
Soviet Union.
Let us unite in reaffirming to the So-
viets and to all nations our belief that
mankind the world over should be free
from tyranny and oppression. I am hop-
ing that before the end of the 89th Con-
gress the Members of this body, by pas-
sage of House Concurrent Resolution 177,
shall express themselves with such cer-
tainty that there can be no mistake on
Federal bureaucracy directed by an am-
bitious political regime.
Never before have the American peo-
ple been subjected to such threats to
privacy by the Government itself or by
Government subsidized organizations.
We are told that wiretapping by some
Government agencies is now regarded as
an accepted -practice. At least one
agency is engaging in organized practice
of various techniques to invade the pri-
vate lives of individuals and families.
Add to this the abuse of testing, and
we are faced with a situation which
brings us far closer to the "1984" of
George Orwell, and the "The Brave New
World," of Aldous Huxley.
We pride ourselves on being individ-
uals, and we trace our history to men
and women who sought freedom from op-
pression of any kind.
Yet today we seem to be marching
without effective protest into a situation
in which a Washington directorate can
act as a "big brother" by making rules
and setting standards from which no de-
viation is tolerated.
News reports published this morning
tell of a great new testing program be-
ing undertaken by the Office of Educa-
tion. The program will not only test
more young people than ever before, but
will also go into new kinds of questions,
any, li tations apply to what kinds of
questi s may be asked of our young
peopl in public schools. The objectives
oft s new program are not primarily to
m ure academic achievement, but
ra er to adjust social conditions to con-
f m with ideas established in the Fed-
relationships. And we know that chil-
dren cannot be expected to do anything
but tolerate even very personal question-
ing.
We also know that in today's political
climate, Government employees or pri-
vate industry employees where Govern-
ment contracts are a big factor and ap-
plicants for Federal jobs, all submit to
tests in a docile manner.
It has been brought to light in the past
2 weeks that political connotations have
been conveyed in some tests. And the
ranking Republican member of the House
Education and Labor Special Subcom-
mittee on Education has asked the Com-
missioner of Education if Federal funds
are being used to purchase politically
slanted materials used in public schools.
This is a problem area which badly
needs the continuing and extensive at-
tention of the American people and,
therefore, of the Congress.
In each case in world history in which
a representative government has deterio-
rated into -dictatorship, control of atti-
tudes of the people has been a major tool
of a power-hungry government clique.
PSYCHOLOGICAL AND PE AL-
ITY TESTING
(Mr. EDWARDS of A abama asked
and was given permission to address the
House for 1 minute, to revise and extend
his remarks, - and include extraneous
matter.)
Mr. EDWARDS of Alabama. Mr.
Speaker, many citizens of the country
are encouraged that a Special Subcom-
mittee of the House Government Op-
erations Committee has conducted a
thorough inquiry into the matter of psy-
chological and personality testing.
And any recommendations the sub-
committee can provide will surely be wel-
come. It seems clear that some kind of
remedial action 'is needed, through legis-
lation or another approach.
There are two aspects to the growing
problem. The first is with regard to the
testing of psychological conditions. The
second has to do with tests meant for
measurement of academic achievement
but which are evidently being slanted in
a way which conveys political or ideolog-
ical significance.
No responsible person will quarrel with
the need for having either kind of test-
ing. They have a proper place in educa-
tion and in the study of psychology.
But they must be recognized as tools
which can be used for ill purpose; either
by -overly enthusiastic educators or a
And it has been accomplished under the
guise of welfare or progress. And in each
case the people sat by quietly at the early
stages of development of this control, un-
til the point of no return had been
reached. -
And then, of course, there is no longer
any opportunity for anyone to speak out
for their rights as individuals and for
the principles of free speech and individ-
uality.
Surely, this country will not permit
that to happen here.
I include in my remarks an editorial
from the Wall Street Journal of today
which touches on this subject.
PEEPING ON THE GRAND SCALE
Psychological testing, like testing for apti-
tudes, doubtless has its place and uses. But
it is a question whether the wholesale peep-
ing into people's minds that is going on in
government, industry, and schools is desir-
able, necessary, or even effective.
Winding up a 3-month inquiry into such
psychological and personality testing, a
House Government Operations Subcommit-
tee heard pleas from a number of witnesses
that Congress adopt curbs against the indis-
criminate use of the quizzes. It is easy to
see why. -
The committee found, among other nau-
seous examples, that employees of the Bon-
neville Power Administration being consid-
ered for promotion were asked questions like
"Which would you rather do: (a) kiss a per-
son of the opposite sex, or (b) experiment
with new things. Choose one."
It further learned that the Labor Depart-
ment last year gave psychological tests to
more than 20,000 applicants for counseling
jobs in youth opportunity projects. The ap-
plicants were supposed to give their reactions
to the following kinds of statement: "Most
people worry too much about sex," and, "I
think Lincoln was greater than Washington."
Moreover, thousands of schoolchildren,
under research projects financed by the U.S.
Office of Education, have undergone psycho-
logical testing in an attempt to probe their
attitudes toward sex, religion, and family life.
Perhaps the most extraordinary thing
about it all is the docility with which candi-
dates for Government jobs, Federal employ-
ees, people in industry-where testing seems
on the increase-and schoolchildren tolerate
the intimate questioning. Especially with a
tool still of dubious value.
One reason, perhaps, is that advanced by
Dr. Karl Smith, professor of industrial psy-
chology at the University of Wisconsin: "The
American people have been fooled into be-
lieving that a few simple-minded true-false
or multiple-choice questions can be used to
to forecast the careers of their children in
school and in the university and to predict
their own careers in work because of two
influences: Fear of the pseudo-quantitative,
mental-medical mumbo-jumbo of the psy-
chiatrist and clinical psychologist, and the
misleading propaganda of organized psychol-
ogy in claiming that guesswork and statisti-
cal shotgun procedures have medical and
scientific significance."
If that is true, maybe what's really needed
to bridle the inquisitive testers is not a new
law but simply the application of a little
horsesense and elementary respect for
privacy.
U.S. TRADE SURPLUS SHRINKS-
MORE BALANCE-OF-PAYMENTS
TROUBLE AHEAD
(Mr. CURTIS (at the request of Mr.
DEL CLAWSON) was granted permission
to extend his remarks at this point in
the RECORD and to include extraneous
matter.)
Mr. CURTIS. Mr. Speaker, for years,
while the United States has been ex-
periencing recurrent deficits in its bal-
ance of payments, we could always point
with pride at our growing trade surplus.
It has been this trade surplus that has
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 24534
CONGRESSIONAL, REcORD HOUSE September 19,
helped to finance the individual- deficit
items in our balance-of-payments ac-
count without running as large an over-
all deficit as we otherwise would have
done. One reason for the strength of
our trade position has been the remark-
able stability of U.S. export prices while
the export prices of foreign nations have
moved sharply upward. Recently, how-
ever, both these trends have begun, to
slow down in a manner that may spell
trouble for the United States.
International Monetary Fund reports
show that the average price of U.S. ex-
,ports, which as recently as,last-fall stood
at 103 rcent of the 1958 average, no
higher than in 1961, has jumped to 1,05
percent. At the same time, the export
price indexes of many other trading na-
tions seem to be leveling off. ' The index
covering the major industrial nations of
continental Europe, for instance, rose 4
percent between mid-1963 and mid-1964,
but has remained at 104 percent of the
1958 average since early last year.
This may account in part for the fact
that during the first 7 months of 1966,
our trade surplus as a seasonally adjusted
annual rate was $4.9 billion, or down
about $2 billion from the 1964 level. Im-
ports through July were running at an
annual rate of 12 percent above the 1964
level while exports were only_2 percent
Higher.
We do not have to look very far to find
a reason for this behavior. It is no coin-
cidence that IMF figures show that liv-
ing costs in many foreign, nations are
climbing less sharply than they once
were while, at the same time, there are
signs of afaster rise in the U.S. cost of
living. . In recent years, the U.S. index
has risen about 1.2 percent annually, but
in the first half of this year, the rise has
amounted ,to 1.1 percent. The period of
mild annual price rises may well be over.
The rapid pace of the American econ-
omy has certainly put increasing upward
pressure on U.S, prices. Some indica-
tions of the price pressure are that our
factories are now operating at about 90
pdreent of capacity and unemployment
611i011g married men, the backbone of the
labor force, now amounts to about 2,3
percent, down sharply from the 5.1 per-
cent early in the current economic ex-
pansion. In addition, the prospect of in-
creased defense spending for Vietnam
is in the wind.
There appears to be no such mounting
price pressure in the foreign countries
that compete with the United States in
world markets. There are indications
that Europe's economic expansion is
slowing down, most probably because of
restrictive, anti-inflationary government
policies.
A recent study by the Boston Federal
Reserve Bank also indicates the U.S.
competitive position in world markets
may be getting rapidly weaker. All of
these factors pointing to a deterioration
in the U.S. trade position do not neces-
sarily mean that we are going to lose our
Position as world trade leader. But, as a
recent article in the' Wall Street Journal
points out, the record of recent months
suggests, that massive trade Surpluses are
by no means guaranteed. And with the
shrinkage of these significant surpluses,
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this country's balance-of-payments
problem may become worse than it al-
ready is. Under unanimous consent, I
include the article in the August 23 edi-
tion of the Wall Street. Journal, in the
RECORD at this point:
-IIE OUTLOOK: APPRAISAL OF CURRENT TRENDS
IN BUSINESS AND FINANCE
For years the large and growing trade cur-
Plus of the United States has been the envy
f foreign capitals. In 1964 it reached a
ecord $6.7 billion and, though the final total
robably won't match last year's, all signs
oint to another multibillion-dollar surplus
or 1.965. A singular statistic helps explain
his happy trend: The average price of U.S.
xports has remained remarkably flat in a
eriod when the general price movement in
orld markets has been sharply upward.
Very recently, however, this picture has
egun to change-in a manner that does not
ugur well for the United States. Inter:na-
ional Monetary Fund reports show that the
verage price of U.S. exports, which as re-
ently as last fall stood at 103 percent of the
.958 average of 100, has jumped to 105; the
Ignificance of this increase can be appreci-
ted 3f one considers that the export price
ndex, at 103 last fall, was no higher than. In
961.
At the same time, after climbing steadily
or years, the export price indexes of many
Cher trading nations appear to be leveling
f. The index covering the major industrial
ountries of continental Europe, for in-
tance, has remained at 104 percent of the
958 average since early last year; between
id-1963 and mid-1964, in contrast, this
ndex climbed 4 percent.
In Japan, export prices have stood at 101
ercent of the 1958 base since the start of
ast year; in the previous 2 years, by com-
arison, the Japanese index climbed more
han 4 percent. At 98, Canada's export price
ndex is actually a point below the level at
he end of last year. Other countries where
xport prices have declined in recent months
dude Italy, Denmark, the Netherlands,
orway, and Switzerland. Export prices
ave remained fiat, or nearly so, in the
nited Kingdom, France, and West Germany.
By no coincidence, IMF figures show, liv-
g costs in many of these nations are climb-.
g less sharply-at the very time there are
igns of a faster rise in the U.S. cost of living.
France, where President do Gaulle has
unshed an anti-inflation drive, living costs
ave barely budged since the start of the
ear. In the previous 12 months, by com-
arison, they increased nearly 4 percent, and
e gain was even sharper before 1964.
The living-cost pattern appears similar in
ch other lands as West Germany, Italy, and
ritain, where the government has recently
ken major steps to hold down prices. In
apan, where the cost of living had been
sing especially swiftly, living costs actually
11 in a recent month.
The U.S. cost-of-living Index, on the other
and, has begun to move up at a faster
ace. In recent years, the U.S. index has
sen at the relatively mild rate of about
2 percent annually. In only the first half
this year, however, the rise has amounted
1.1 percent, a gain that clearly indicates
e recent period of 1.2 percent annual
ins may be over.
The rapid pace of the American economy,
c L* course, has tended to put increasing
ward pressure on U.S. prices. American
f ctories, which a few years ago were using
I as than 80 percent of their full capacity,
w are operating at about 90 percent, ac-
rding to Federal estimates. This rate, Kis-
t ry suggests, is dangerously near the level
which prices begin to move up swiftly.
Similar pressure on U.S. prices is indicated
labor statistics. The rate of unemploy-
ment among married men, the backbone
the labor force, amounts to only 2.3 per-
ent, down sharply from 5.1 percent early
n the current economic expansion.. On top
f all this, the prospect of rising defense
utlays for Vietnam can only add Inflation-
iry There appears to be no such mou (rpri~e
ressure in many countries t r"u(tgq
?th the United States in word marke
recent report by New York's hase Man-
attan Bank states that "the to po of Eu-
ope's economic expansion has slowed con-
iderably this year" and attributes the slow-
own to "restrictive, anti-inflationary poli-
ces on the part of most governments."
For instance, according to the report, wage
ates in most European countries are rising
flore slowly than a year ago. In France,
ypically, wages climbed only 2 percent in
he first half of 1965, down from a 3.2 per-
ent gain in the like 1964 period. It also
hould be noted that the Vietnam war is
lacing relatively little strain on most Euro-
ean economies; Britain, in fact., recently
nnounced a $616 million slash in Its annual
efense budget, as part of its fight against
fiation.
A study by the Boston Federal Reserve
lank, discussed in the July issue of the
ank's monthly business review, also in-
icates the U.S. competitive position in
world markets may be getting rapidly weaker.
he study, which covered some 200 types
f consumer goods, concludes that in for-
ign markets "our position has sharply de-
eriorated."
In addition to developments on the price
ront, there is some increasing concern over
he make-up of U.S. trade statistics. Studies
ndicate the big surpluses of recent years
effect more than simply sucessful competi-
ion in the world markets. They also re-
set such factors as Government grants and
xports by U.S. companies to their sed subsidiaries. One study, which scrut-
zed the trade figures for a recent year,
ound that a $5.4 billion trade surplus melted
own to a $500 million surplus after such
actors were discounted.
To be sure, it is by no means certain that
ncle Sam is about to lose his position as
itan of world trade. It is not clear, for
stance, that the recent jump in U.S. ex-
rt prices signals a long-term trend or
hat Europe's drive against inflation will
ucceed. Nevertheless, the record of re-
ent months suggests that continuing mas-
ive trade surpluses are by no means guar-
nteed. Without such surpluses, it is hardly
ecessary to add, this country's balance-of-
ayments problem, already worrisome, could
BENEFICIAL EFFECTS FLOWING
FROM SUSPENDING THE IMPORT
DUTY ON NICKEL
(Mr. SCHNEEBELI (at the request of
Mr. DEL CLAwsoN) was granted permis-
sion to extend his remarks at this point
in the RECORD and to include extraneous
matter.)
Mr. SCHNEEBELI. Mr. Speaker, it is
gratifying to report to the House an
article commenting on the beneficial ef-
fects flowing from our recent congres-
sional action in suspending the import
duty on nickel. Following House ap-
proval of this legislation, the unanimous
vote by the Senate, and the approving
signature of the President, the Canadian
exporters passed along by a price cut
the entire amount of the suspended duty
of 11/4 cents per pound. This action "re-
moves the price disadvantage previously
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