Mr. Chairman, I don't like to be negative but I must in the light of my own experience as chairman of the Joint Economic Committee, urge you to reconsider S. 5 in the respects which I have set forth.

Senator MONDALE. Thank you, Senator Proxmire. Would you not agree that the structure embodied in the Employment Act of 1946 with the Council of Economic Advisers, the Joint Economic Committee, and the annual economic report has had a profound and beneficial effect on the development of economic policy and its understanding in this country?

Senator PROXMIRE. I think it has. As a matter of fact, it is very interesting to consider the progress of economic policy. It just happened that I went back to Harvard graduate school to study and take graduate courses in economics and government in 1946 after World War II. Economic policy was literally just beginning and a lot of the statistics we have now weren't conceived. GNP was pretty much of a new concept. We had very few money statistics and so forth. So, the development of economic policy followed the creation of the President's Economic Report and the Joint Economic Committee, the Council of Economic Advisers. You are absolutely right. I think this enormously helped to advance economic policy. We still have a long, long way to go. To look at our economy today, it could hardly be worse in many ways, but at least we are asking the right questions and I think there is an alternative to the administration's economic game plan.

Senator MONDALE. At least they are listening to you.

Senator PROXMIRE. That is right. They don't have the chairman of the economic advisers as number one policy maker now. That is the Secretary of the Treasury, who is not an economist.

Senator MONDALE. Would you not agree that there are several strengths in the present economic structure? First, it does attract some of the finest professional economists in the country and, therefore, the Council of Economic Advisers has been a very distinguished body. The top economists in the country do feel that this call by the President to the Council of Economic Advisers is a high call, worthy of their response?

Senator PROXMIRE No question about it. Consistently they have had three of the best economists in the country on the Council. They have had excellent staff.

Senator MONDALE. That was my second point, that the Council of Economic Advisers has been an institution of sufficient prestige to attract the finest and gifted staff from the beginning.

Senator PROX MIRE. Yes, indeed, I agree.

Senator MONDALE. Would you not say that the annual economic report has been a unique institution in itself as an engine for truth and analysis? The annual report has been used by university departments of economics, by businesses, by independent economists, as well as by the Congress and the Joint Economic Committee to carry on an annual sophisticated discussion of economics, of economic statisties, of economic policy and the rest. It has been a unique and important engine for progress.

Senator PROXMIRE. All that is very true and I think in addition to that, most important of all it requires the President of the United States to focus on economic policies and to consider what the alter

natives are to achieve the goal of growth and high level employment and price stability and so forth. It requires him to do that, put it all together in a report.

Senator MONDALE. Would you not also agree that probably the key to this has been the tension that exists between the executive and the legislative? In other words, by the creation of a Joint Economic Committee, the Congress has kept the pressure on the Council of Economic Advisers and the executive to come up with data that are usable, that are contemporarily relevant, and that are understandable. The J.E.C. has probed the candor of the economic report as well as contemporary economic policy and the matter of priorities. to which you made reference. It has been the tension that has existed between the executive and legislative because of the Joint Economic Committee that has been one of the key elements in the growing evolution and strength of that whole process? Would you not agree to that?

Senator PROXMIRE. Yes, that is true.

Senator MONDALE. I don't know how these three elements were developed in that way, but I think the whole process has been one of the most creative and successful efforts in American Government. I am enormously impressed by it. That is why I initially proposed the creation of a Joint Social Committee to parallel the responsibility of the Joint Economic Committee.

Senator PROXMIRE. The Joint Economic Committee, I think you are right, has made a lot of progress. There is a lot of potentiality here but as I have indicated, we have a long, long way to go. The Congress I think does a pathetic job. The Government does a pathetic job in determining our priorities. We just don't do it. We stumble into it. Whatever is proposed by the President, we modify a little bit here and there but there is no effective, coherent, organized way that we can get at it. We are just beginning to get at that level. So, although we have this potentiality, which you point out, I think the Joint Economic Committee has reached only a small portion of the potential it should reach. Once again, I think I follow the path down which you are leading me.

Senator MONDALE. You seem a little reluctant, though, to travel it. Senator PROXMIRE. Of course, I see at the end of that path that if this has worked so well for economics in the country, why shouldn't it work for sociology? Why shouldn't it work for social priorities? Senator MONDALE. Exactly what I was going to ask.

Senator PROXMIRE. The answer is that I think these things are interwoven and I think deeply interwoven. I think once you separate them and try to create a system of priorities without reference to economic resources, I think it can be exciting and it can be stimulating and it can be controversial but I don't think it can be effective.

Senator MONDALE. Isn't it true that in the over 20-year history of the Council of Economic Advisers they have, for all practical purposes, contributed nothing in the human problem analysis field? Wouldn't that be fair to say? Except for general economics.

Senator PROXMIRE. The question is, do you think in the 23 years of the Joint Economic Committee a contribution may be beginning in the economic area but not in the social area?

Senator MONDALE. Yes.

Senator PROXMIRE. I wouldn't agree with that at all.

Senator MONDALE. Can you point to anything that they have done of significance in the human problem analysis field?

Senator PROXMIRE. You sound like one of my opponents when I am running for office, name one thing you have done since you have been there.

Senator MONDALE. I am on your side. I was in Milwaukee just yesterday bragging about you and got a tremendous hand.

Senator PROXMIRE. But I do believe-let me put it this way, housing and employment

Senator MONDALE. What have they done to analyze the housing problem? I am on a housing committee. I have been on it as you have for 7 years and I can't think of a single thing that the Council of Economic Advisers has done that is meaningful in terms of analyzing housing.

Senator PROXMIRE. You asked about the Council of Economic Advisers. I thought you meant the Joint Economic Committee because I think we have been able to develop the fact that the heart of housing progress is in a monetary policy that we are working with. We have issued reports and we tried to get the Federal Reserve Board and now we are on the verge of it-within 60 days the Federal Reserve Board is going to come forward with a program on housing, thanks to our prodding them.

Senator MONDALE. Let us take education. What has the Council of Economic Advisers done to analyze education? How do children learn and that sort of thing?

Senator PROXMIRE. This is exactly why we want to develop this new unit that you are suggesting within the Joint Economic Committee so that we can prod them on that and get them doing it.

Senator MONDALE. You see, I think you are on very strong grounds when you argue for some kind of priorities analysis by the Joint Economic Committee and by the Council of Economic Advisers in the general economics field. But I have talked to several former members of the Council of Economic Advisers. They all admit privately that they have done practically nothing in the human problem field. None of them are skilled in the human problem field. They are general economists.

What they have done is terribly impressive and terribly important but this whole question of trying to develop a similar initiative in human problems is long overdue and long neglected. We need the same kind of approach, in my opinion, in these human fields, the same sort of effort to develop some contemporary relevance, the same need to bring the top Walter Heller-type social scientists into the highest level of governmental advice, the same need for the annual report, the same need for executive-legislative tension in the development of solutions to human problems and in the development of social

Senator PROXMIRE. I see where you are going now. I didn't perceive it fully before. As far as the executive branch is concerned, isn't it true that this is a clear responsibility, as far as health, education, and welfare are concerned of a Cabinet department-of the Health, Education, and Welfare Department?

Senator MONDALE. That is correct.

Senator PROXMIRE. That is their job. They have offices equipped for at. They have enormous staffs who have that responsibility and you ve the same thing with respect to housing with HUD. That is their b. They may or may not be doing a good job or have done a good b in the past but that is their function and it seems to me it is up to Our Committee on Labor and Welfare to go after HEW and you do. Senator MONDALE. Would you suggest then that since we have a reasury Department and a Commerce Department we should disband he Council of Economic Advisers?

Senator PROXMIRE. No, because I think that economic policy is not ust a matter of Treasury Department and the Commerce Departnent or the Labor Department. It cuts across those departments as it cuts across a lot of congressional committees.

Senator MONDALE. Don't you think there is similar cross-cutting in human problems?

Senator PROXMIRE. As a matter of fact, with respect to education, for example, it is concentrated in your committee and that is concentrated in the Health, Education, and Welfare Department. There is some proliferation but its main thrust is right there.

Senator MONDALE. I respectfully disagree. You have the Bureau of Indian Affairs, you have the tremendous education program at the Department of Defense, you have the National Science Foundation and you have all sorts of related programs. As you know, the problem with these departments is that you get fired when you tell the truth. You hired a person who had been fired for telling the truth about the C5-A. One of the things that is unique about the Council of Economic Advisers is that you bring to that institution people of such high professional standing that they are not going to stand behind a lot of this departmental parochialism. They have their professional reputations at stake. They take a Government-wide view of a problem.

To deal with these executive departments, where everybody is an expert on a little piece of a problem, we need to take a total, strategic look at human problems the way be have taken a total, strategic look at economic problems.

Senator PROXMIRE. I think this is right and I do think that there is more strength in unity than in competition as far as this is concerned. I would welcome, Mr. Chairman, you joining us in developing the Joint Economic Committee into a broader, more effective unit and also requiring the President's economic report to set forth exactly the kind of thing we are talking about this morning. That is what economics is all about. Economics isn't just a matter of efficiency. It is efficiency for a purpose.

Senator MONDALE. If that is what it is all about, how come they have never bothered with the human purposes?

Senator PROXMIRE. They haven't been charged with it. They haven't been required to by the Congress because it is an uncomfortable thing to do, but I think they could be and they should be.

Senator MONDALE. Thank you very much.

Senator PROXMIRE. Thank you, Mr. Chairman.

Senator MONDALE. We may have to discuss this further on the Senate floor. Thank you very much for your most useful contribution.

Our next witness is Mr. Dwight Ink, Assistant Director of the Office of Management and Budget. Mr. Ink, I will place your full statement in the record as though read and you may proceed as you wish.

STATEMENT OF DWIGHT A. INK, ASSISTANT DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET; ACCOMPANIED BY JULIUS SHISKIN, DIRECTOR OF STATISTICAL POLICY STAFF, OFFICE OF MANAGEMENT AND BUDGET

Mr. INK. Thank you, Mr. Chairman. I have with me, Mr. Shiskin, who is Director of our Statistical Policy Staff in the Office of Management and Budget, to join me in the appearance.

Senator MONDALE. All right.

Mr. INK. Mr. Chairman, I would like to begin by stating that, as I think you know, we are very much in agreement with the emphasis which you and this committee have placed over a period of years now on the importance of goals and priorities and better means of assessing progress or lack of progress towards those goals.

I think the work of this committee has contributed in a significant way to the broadening interest and concern for these things. I think we all agree that the problems of the times have moved more rapidly than much of our ability and capacity to understand the nature of the problems. And our ability to accurately measure the extent to which we are, or are not, meeting goals and targets is something which needs a great deal of developmental work.

We do continue to feel that the proposed council is not the best mechanism for approaching this matter and we do feel that the proposed council would significantly overlap the Domestic Council which was established about a year ago and which was based upon the experience of several administrations, both Democratic and Republican, concerning the need for drawing together in a much broader way, as you have just been indicating in the last few minutes, the thinking, planning, and programing with respect to social problems.

It seems to us that the Domestic Council has the built-in strength of its membership being department heads. It is in a strong position, therefore, to coordinate the work of departments and its members can both advise on policy issues and act to implement them. It seems to us that the machinery has a capacity for drawing on a very wide range of thinking, which is particularly important in dealing with social programs. No two States are the same. Each community is different. Each neighborhood is different. I often think of them like human beings. We have over the years tended to fragment our thinking, fragment our efforts, in part through the categorical grant programs. We need ways of looking at the totality of community problems. Therefore, work in this area with respect to development of social indicators involves not only the problem of aggregating meaningful data but also how best to disaggregate meaingful data as it bears upon individual areas in the communities.

Although I don't want to overstress this point, Mr. Chairman, we believe that the proposed departmental reorganization will help. We think it will help to solve some of the kinds of problems that you and