ond times by unanimous consent and referred as follows: By Mr. HRUSKA: S. 2683. A bill for the relief of Laszlo Janos Buchwald; to the Committee on the Judiciary. By Mr. SMATHERS: S. 2684. A bill for the relief of Mr. and Mrs. Juan C. Jacobe, and their four children, Angela Jacobe, Teresita Jacobe, Leo Jacobe, and Ramon Jacobe; and S. 2685. A bill for the relief of Mr. and Mrs. Pandelis Salvaris; to the Committee on the Judiciary. By Mr. ALLOTT: S. 2686. A bill for the relief of Stepanida Losowskaja; and S. 2687. A bill for the relief of Robert D. Barbee; to the Committee on the Judiciary. By Mr. YOUNG of North Dakota (for himself, Mr. MCCARTHY, Mr. MUNDT, and Mr. METCALF): S. 2688. A bill to amend the Agricultural Act of 1961 and the Soil Conservation and Domestic Allotment Act, as amended, to permit under certain circumstances flaxseed to be raised on acreage diverted from the production of wheat; to the Committee on Agriculture and Forestry. By Mr. EASTLAND: S. 2689. A bill to amend sections 3(7) and 5(b) of the Internal Security Act of 1950; to the Committee on the Judiciary. the Government or of Government officials and employees and any and all such improper practices between Government personnel and corporations, individuals, companies, or persons affiliated therewith, doing business with the Government; and the compliance or noncompliance of such corporations, companies, or individuals or other entities with the rules, regulations, and laws governing the various governmental agencies and its relationships with the public: Provided, That in carrying out the duties herein set forth, the inquiries of this committee shall not be deemed limited to the records, functions, and operations of the particular branch of the Government under inquiry, and may extend to the records and activities of persons, corporations, or other entities dealing with or affecting that particular branch of the Government, and that: SEC. 2. The Committee on Government Operations or any duly authorized subcommittee thereof be further authorized from February 1, 1962, to January 31, 1963, inclusive, to conduct an investigation and study of the extent to which criminal or other improper practices or activities are, or have been engaged in in the field of labor-management relations or in groups or organizations of employees or employers, to the detriment of interests of the public, employers, or employees, and to determine whether any changes are required in the laws of the United States in order to protect such interests against the occurrence of such practices or activities. Nothing contained in this resolution shall affect or impair the exercise by the Committee on Labor and Public Welfare of any power, or the discharge by such committee of any duty, conferred or imOn motion by Mr. BOGGS, and by posed upon it by the Standing Rules of unanimous consent, the Senate or by the Legislative Reorganization Act of 1946. By Mr. STENNIS (for himself and S.J. Res. 146. Joint resolution to provide for designation of the U.S. Veterans' Administration hospital hospital at Jackson, Miss., as the "John Elliott Rankin Memorial Veterans Hospital"; to the Committee on Labor and Public Welfare. COAUTHOR OF SENATE BILL 2531 Ordered, That the name of Mr. BUSH be added as a coauthor of the bill (S. 2531) to designate Columbus Day as a legal holiday. STUDIES AS TO EFFICIENCY AND ECONOMY OF OPERATIONS OF THE GOVERNMENT Mr. MCCLELLAN, from the Committee on Government Operations, reported the following resolution (S. Res. 250); which was referred to the Committee on Rules and Administration: Resolved, That in holding hearings, reporting such hearings, and making investigations as authorized by section 134 of the Legislative Reorganization Act of 1946 and in accordance with its jurisdiction under rule XXV of the Standing Rules of the Senate, the Committee on Government Operations, or any subcommittee thereof, is authorized from February 1, 1962, through January 31, 1963, to make investigations into the efficiency and economy of operations of all branches of the Government including the possible existence of fraud, misfeasance, malfeasance, collusion, mismanagement, incompetence, corrupt or unethical practices, waste, extravagence, conflicts of interest, and the improper expenditure of Government funds, in transactions, contracts, and activities of SEC. 3. The Committee on Government Operations or any duly authorized subcommittee thereof is further authorized and directed from February 1, 1962, to January 31, 1963, inclusive, to make a full and complete study and investigation of syndicated or organized crime which may operate in or otherwise utilize the facilities of interstate or international commerce in furtherance of any transactions which are in violation of the law of the United States or of the State in which the transactions occur, and, if so, the manner and extent to which, and the identity of the persons, firms, or corporations, or other entities by whom such utilization is being made, what facilities, devices, methods, techniques, and technicalities are being used or employed, and whether or not organized crime utilizes such interstate facilities or otherwise operates in interstate commerce for the development of corrupting influences in violation of the law of the United States or the laws of any State, and further, to study and investigate the manner in which and the extent to which persons engaged in organized criminal activities have infiltrated into lawful business enterprise; and to study the adequacy of Federal laws to prevent the operations of organized crime in interstate or international commerce; and to determine whether any changes are required in the laws of the United States in order to protect the public against the occurrences of such practices or activities. Nothing contained in this resolution shall affect or impair the exercise by the Committee on the Judiciary or by the Committee on Commerce of any power, or the discharge by such committee of any duty, conferred or imposed upon it by the Standing Rules of the Senate or by the Legislative Reorganization Act of 1946. SEC. 4. The Committee on Government Operations or any of its duly authorized subcommittees shall report to the Senate by January 31, 1963, and shall, if deemed appropriate, include in its report specific legislative recommendations. SEC. 5. For the purposes of this resolution, the committee from February 1, 1962, to January 31, 1963, inclusive, is authorized, as it deems necessary and appropriate, to (1) make such expenditures from the contingent fund of the Senate; (2) hold such hearings; (3) sit and act at such times and places during the sessions, recesses, and adjournment periods of the Senate; (4) require by subpena or otherwise the attendance of such witnesses and production of such correspondence, books, papers, and documents; (5) administer such oaths; (6) take such testimony, either orally or by deposition; (7) employ on a temporary basis such technical, clerical, and other assistants and consultants; and (8) with the prior consent of the executive department or agency concerned and the Committee on Rules and Administration, employ on a reimbursable basis such executive branch personnel as it deems advisable; and further, with the consent of other committees or subcommittees to work in conjunction with and utilize their staffs, as it shall be deemed necessary and appropriate in the judgment of the chairman of the committee: Provided further, That the minority is authorized to select one person for appointment and the person selected shall be appointed and his compensation shall be so fixed that his gross rate shall not be less by more than $1,400 than the highest gross rate paid to any other employee. SEC. 6. The expenses of the committee under this resolution, which shall not exceed $400,000, shall be paid from the contingent fund of the Senate on vouchers approved by the chairman of the committee. INVESTIGATION OF CERTAIN MATTERS WITHIN JURISDICTION OF COMMITTEE ON COMMERCE Mr. MAGNUSON submitted the following resolution (S. Res. 251); which was referred to the Committee on Commerce: Resolved, That the Committee on Commerce, or any duly authorized subcommittee thereof, is authorized under sections 134 (a) and 136 of the Legislative Reorganization Act of 1946, as amended, and in accordance with its 1) interstate commerce generally; (2) foreign commerce generally: (3) maritime matters; (4) interoceanic canals; (5) transportation policy: (6) domestic surface transporta tion, including pipelines: (7) communications, including a complete review of national and international telecommunications and the use of communications satellites; (8) Federal power matters; (9) civil aeronautics; (10) fisheries and wildlife: (11) marine sciences; and (12) Weather Bureau operations and planning, including the use of weather satellites. SEC. 2. For the purposes of this resolution the committee, from February 1. 1962, to January 31, 1963, inclusive, is authorized (1) to make such expenditures as it deems advisable; (2) to employ, upon a temporary basis, technical, clerical, and other assistants and consultants: Provided, That the minority is authorized to select one person for appointment, and the person so selected shall be appointed and his compensation shall be so fixed that his gross rate shall not be less by more than $1,400 than the highest gross rate paid to any other employee; and (3) with the prior consent of the heads of the departments or agencies concerned, and the Committee on Rules and Administration, to utilize the reimbursable services, information, facilities. and personnel of any of the departments or agencies of the Government. SEC. 3. The committee shall report its findings, together with its recommendations for legislation as it deems advisable, to the Senate at the earliest practicable date, but not later than January 31, 1963. SEC. 4. Expenses of the committee. under this resolution, which shall not exceed $ -, shall be paid from the contingent fund of the Senate upon vouchers approved by the chairman of the committee. STOCK DISTRIBUTION TREATED AS RETURN OF CAPITAL On motion by Mr. MANSFIELD, and by unanimous consent. The Senate resumed the consideration of its unfinished business, viz, the bill (H.R. 8847) to amend the Internal Revenue Code of 1954 so as to provide that a distribution of stock made to an individual or certain corporations) pursuant to an order enforcing the antitrust laws shall not be treated as a dividend distribution but shall be treated as a return of capital; and to provide that the amount of such a distribution made to a corporation shall be the fair market value of the distribution. Pending debate, ADJOURNMENT On motion by Mr. MANSFIELD, at 4 o'clock and 34 minutes p.m., The Senate adjourned. THE JOURNAL On motion by Mr. MANSFIELD, and by unanimous consent, The reading of the Journal of the proceedings of Tuesday, January 16. 1962, was dispensed with. COMMITTEE AUTHORIZED TO SIT The Subcommittee on Internal Security of the Committee on the Judiciary was authorized to sit today during the session of the Senate; on the request of Mr. MANSFIELD. AUTHORITY FOR SECRETARY OF SENATE TO RECEIVE PRESIDENT'S ECONOMIC REPORT On motion by Mr. MANSFIELD, and by unanimous consent, Ordered, That the Secretary of the Senate be authorized to receive on Saturday, January 20, 1962, the message of the President of the United States. transmitting his Economic Report. REORGANIZATION OF DEPARTMENT OF THE ARMY-REPORT ON NATIONAL SECURITY ACT OF 1947 The VICE PRESIDENT laid before the Senate the following message from the President of the United States, which, with the accompanying papers, was referred to the Committee on Armed Services: THE WHITE HOUSE Hon. LYNDON B. JOHNSON, DEAR MR. PRESIDENT: I have approved a plan for the reorganization of the Department of the Army. This plan was recommended by the Secretary of the Army after detailed study and approved by the Secretary of Defense. A copy of the reorganization plan is enclosed herewith. I am also enclosing for transmission to the chairman of the Armed Services Committee a communication from the Secretary of Defense reporting, pursuant to section 202(c) (1) of the National Security Act of 1947, as amended, the action to be taken with reference to abolition of certain statutory officers and the transfer of their functions to the Secretary of the Army. Sincerely. JOHN F. KENNEDY. REPORT OF COMMITTEE ON PUBLIC WORKS Mr. KERR, from the Committee on Public Works, to whom was referred the bill (H.R. 157) to change the name of the Playa del Rey Inlet and Harbor, Venice, Calif., to the Marina del Rey, Los Angeles, Calif., reported it without amendment and submitted a report (No. 1120) thereon. Mr. KERR, from the Committee on Public Works, to whom was referred the resolution (S. Res. 243) authorizing the Committee on Public Works to make a study of certain matters within its jurisdiction, reported it without amendment and submitted a report No. 1121) there on. Ordered, That it be referred to the Committee on Rules and Administration. CHANGE OF REFERENCE On motion by Mr. COTTON for Mr. MANSFIELD), and by unanimous consent. Ordered. That the Committee on Banking and Currency be discharged from the further consideration of the resolution 8. Res. 249) to provide additional funds for the Committee on Small Business and that it be referred to the Committee on Rules and Administration. INTRODUCTION OF BILLS AND JOINT Bills and a joint resolution were introduced, severally read the first and second times by unanimous consent and referred as follows: By Mr. CARLSON: S. 2692. A bill for the relief of Armand Seri; to the Committee on the Judiciary. S. 2693. A bill to provide for the issuance of a special postage stamp in commemoration of the 50th anniversary of the Garden Club of America; to the Committee on Post Office and Civil Service. By Mr. MANSFIELD: S. 2694. A bill for the relief of Mrs. Jum Ak Marek; to the Committee on the Judiciary. By Mr. JOHNSTON: S. 2695. A bill to amend section 610 of the Federal Aviation Act of 1958 to prohibit the serving of alcoholic beverages to airline passengers unless adequate charge is made for such service: to the Committee on Commerce. By Mr. ANDERSON: S. 2696. A bill to correct certain land descriptions in the act entitled "An act to declare that the United States holds in trust for the pueblos of Santa Ana, Zia, Jemez, San Felipe, Santo Domingo. Chochiti, Isleta, and San Ildefonso certain public domain lands": to the Committee on Interior and Insular Affairs By Mr. YARBOROUGH for himself and Mr. JACKSON: S. 2697. A bill to amend chapters 33 and 35 of title 38, United States Code, to preserve the rights of reservists and National Guardsmen called or ordered to active duty on or after August 1, 1961; to the Committee on Labor and Public Welfare. S. 2701. A bill for the relief of Lee Kwan Tee; to the Committee on the Judiciary. Mr. THURMOND (for himself and Mr. JOHNSTON): S. 2702. A bill for the relief of SanMan Inn of Manning, Inc.; to the Committee on Interior and Insular Affairs. By Mr. BIBLE: S. 2703. A bill for the relief of Felicia Atkins; to the Committee on the Judiciary. By Mr. ERVIN (for himself and Mr. JORDAN): S.J. Res. 147. Joint resolution providing for the establishment of the North Carolina Tercentenary Celebration Commission to formulate and implement plans to commemorate the 300th anniversary of the State of North Carolina, and for other purposes; to the Committee on the Judiciary. ADDITIONAL COAUTHORS OF SENATE BILL 480 On motion by Mr. JAVITS, and by unanimous consent, Ordered, That the names of the following Senators be added as coauthors of the bill (S. 480) to prohibit the application of unreasonable literacy requirements with respect to the right to vote: Mr. BURDICK, Mr. CHAVEZ, Mr. DIRKSEN, Mr. GRUENING, Mr. HART, Mr. JACKSON, Mr. LONG of Missouri, Mr. McCARTHY, Mr. PROXMIRE, and Mr. WILLIAMS of New Jersey. ADDITIONAL ASSISTANT CHIEF CLERK, STAFF AND CLERICAL PERSONNEL FOR COMMITTEE ON LABOR AND PUBLIC WELFARE Mr. HILL submitted the following resolution (S. Res. 252); which was referred to the Committee on Labor and Public Welfare: Resolved, That the Committee on Labor and Public Welfare is authorized from February 1, 1962, through January 31, 1963, to employ one additional assistant chief clerk, six additional professional staff members, and eight additional clerical assistants to be paid from the contingent fund of the Senate at rates of compensation to be fixed by the chairman in accordance with section 202(a), as amended, of the Legislative Reorganization Act of 1946, and the provisions of Public Law 4, Eightieth Congress, approved February 19, 1947, as amended. JACK BAER-REFERENCE OF SENATE BILL 2672 TO COURT OF CLAIMS Mr. CLARK submitted the following resolution (S. Res. 253); which was referred to the Committee on the Judiciary: Resolved, That the bill (S. 2672) entitled "A bill for the relief of Jack Baer", now pending in the Senate, together with all accompanying papers, is hereby referred to the Court of Claims; and the court shall proceed with the same in accordance with the provisions of sections 1492 and 2509 of title 28 of the United States Code and report to the Senate, at the earliest practicable date, giving such findings of fact and conclusions thereon as shall be sufficient to inform the Congress of the nature and character of the demand as a claim, legal or equitable, against the United States and the amount, if any, legally or equitably due from the United States to the claimant. ADDITIONAL COAUTHOR OF SENATE On motion by Mr. COTTON (for Mr. MANSFIELD), and by unanimous consent, Ordered, That the name of Mr. ROBERTSON be added as a coauthor of the resolution (S. Res. 244) authorizing the Committee on Banking and Currency to investigate matters relating to public and private housing. STOCK DISTRIBUTION TREATED AS RETURN OF CAPITAL On motion by Mr. MANSFIELD, and by unanimous consent, The PRESIDING OFFICER (Mr. TALMADGE in the chair) laid before the Senate its unfinished business, viz, the bill (H.R. 8847) to amend the Internal Revenue Code of 1954 so as to provide that a distribution of stock made to an individual (or certain corporations) pursuant to an order enforcing the antitrust laws shall not be treated as a dividend distribution but shall be treated as a return of capital; and to provide that the amount of such a distribution made to a corporation shall be the fair market value of the distribution; and The Senate resumed the consideration of the said bill. Pending debate, MEMORIAL ADDRESSES ON LIFE, CHARACTER, AND PUBLIC SERVICES OF THE LATE SENATOR FROM NEW HAMPSHIRE, STYLES BRIDGES Pursuant to announcement of January 10, 1962, Mr. COTTON submitted the following resolution (S. Res. 254): Resolved, That the Senate has heard with profound sorrow of the death of Honorable STYLES BRIDGES, late a Senator from the State of New Hampshire. Resolved, That as a mark of respect to the memory of the deceased the business of the Senate be now suspended to enable his associates to pay tribute to his high character and distinguished public service. Resolved, That the Secretary communicate these resolutions to the House of Representatives and transmit an enrolled copy thereof to the family of the deceased. The Senate proceeded to consider the said resolution; and remarks upon the life, character, and public services of the late Senator were thereupon delivered by Mr. COTTON, Mr. MURPHY, Mr. HICKENLOOPER Mr. DIRKSEN, Mr. MANSFIELD, Mr. SALTONSTALL, Mr. RUSSELL, Mr. WILEY, Mr. BYRD of Virginia, Mr. AIKEN, Mr. ELLENDER, Mr. CAPEHART, Mr. McCLELLAN, Mr. WILLIAMS of Delaware, Mr. HOLLAND, Mr. MUNDT, Mr. ROBERTSON, Mrs. SMITH, Mr. STENNIS, Mr. DWORSHAK, Mr. PASTORE, Mr. BENNETT, Mr. KERR, Mr. BUSH, Mr. GORE, Mr. CASE of South Dakota, Mr. ERVIN, Mr. KUCHEL, Mr. KEFAUVER, Mr. YOUNG of North Dakota, Mr. SYMINGTON, Mr. HRUSKA, Mr. SPARKMAN, Mr. CURTIS, Mr. THURMOND, Mr. ALLOTT, Mr. TALMADGE, Mr. CASE of New Jersey, Mr. DODD, Mr. COOPER, Mr. GRUENING, Mr. MORTON, Mr. JAVITS, Mr. KEATING, Mr. FONG, Mr. MILLER, Mr. YARBOROUGH, and Mr. PELL. The resolution submitted by Mr. CoTTON was unanimously agreed to. ADJOURNMENT On motion by Mr. COTTON, The Senate, at 6 o'clock and 7 minutes p.m., as a further mark of respect to the memory of the late Senator, adjourned. THURSDAY, JANUARY 18, 1962 The VICE PRESIDENT called the Senate to order, and the Chaplain offered prayer. THE JOURNAL On motion by Mr. MANSFIELD, and by unanimous consent, The reading of the Journal of the proceedings of Wednesday, January 17, 1962, was dispensed with. COMMITTEE AUTHORIZED TO SIT The Subcommittee on Internal Security of the Committee on the Judiciary was authorized to sit today during the session of the Senate, on the request of Mr. HUMPHREY. THE BUDGET The VICE PRESIDENT laid before the Senate the following message from the President of the United States: which, with the accompanying documents, was referred to the Committee on Appropriations: To the Congress of the United States: I present with this message my budget recommendations for the fiscal year 1963, beginning next July 1. This is the first complete budget of this administration. It has been prepared with two main objectives in mind: First, to carry forward efficiently the activities-ranging from defense to postal services, from oceanographic research to space exploration-which by national consensus have been assigned to the Federal Government to execute; Second, to achieve a financial plan— a relationship between receipts and expenditures-which will contribute to economic growth, high employment, and price stability in our national economy. Budget expenditures for fiscal 1963 will total $92.5 billion under my recommendations-an increase of $3.4 billion over the amount estimated for the pressent fiscal year. More than three-quarters of the increase is accounted for by national security and space activities, and the bulk of the remainder by fixed interest charges. Because of the increasing requirements for national security, I have applied strict standards of urgency in reviewing proposed expenditures in this budget. Many desirable new projects and activities are being deferred. I am, moreover, recommending legislation which will reduce certain budgetary outlays, such as the postal deficit and the cost of farm price and production adjustments. It would not, of course, be sensible to defer expenditures which are of great significance to the growth and strength of the Nation. This budget therefore includes a number of increases in existing programs and some new proposals of high priority-such as improvements in education and scientific research, retraining the unemployed and providing young people with greater employment opportunities, and aid to urban mass transportation. Budget receipts in fiscal year 1963 are estimated to total $93 billion, an increase of $10.9 billion over the recession-affected level of the present fiscal year. These receipts estimates are based on the expectation that the brisk recovery from last year's recession will continue through the coming year and beyond carrying the gross national product during calendar 1962 to a record $570 billion. Summary of Federal finances The administrative budget for 1963 thus shows a modest surplus of about $500 million. Federal accounts on the basis of the consolidated cash statement combining the administrative budget with other Federal activities. mainly the social security, highway, and other trust funds-show an estimated excess of receipts from the public of $1.8 billion over payments to the public. And in the terms in which our national income accounts are calculated-using accrued rather than cash receipts and expenditures, and including only transactions directly affecting production and income the Federal surplus is estimated at $4.4 billion. By all three measures in current use. therefore, the Federal Government is expected to operate in 1963 with some surplus. This is the policy which seems appropriate at the present time. The economy is moving strongly forward, with employment and incomes rising. The prospects are favorable for further rises in the coming year in private expenditures, both consumption and investment. To plan a deficit under such circumstances would increase the risk of inflationary pressures, damaging alike to our domestic economy and to our international balance of payments. On the other hand, we are still far short of full capacity use of plants and manpower. To plan a larger surplus would risk choking off economic recovery and contributing to a premature downturn. Under present economic circumstances, therefore, a moderate surplus of the magnitude projected above is the best national policy, considering all of our needs and objectives. BUDGET EXPENDITURES The total of budget expenditures estimated at $92.5 billion in fiscal 1963is determined in large measure by the necessary but costly programs designed to achieve our national security and international objectives in the current world situation. Expenditures for national defense, international, and space programs account for more than threefifths of total 1963 budget outlays, and for more than three-fourths of the estimated increase in expenditures in 1963 as compared to 1962. Indeed, apart from the expected increase in interest payments, expenditures for the so-called domestic civil functions of government have been held virtually stable between 1962 and 1963. Within this total there are important shifts in direction and emphasis. Expenditures for agricultural programs, for the postal deficit, and for temporary extended unemployment compensation are expected to drop. The fact that funds for these purposes can be reduced permits us to make increases in other important areas-notably education, health, housing, and natural resource development-without raising significantly total expenditures for domestic civil functions. National defense: This budget carries forward the policies instituted within the past 12 months to strengthen our military forces and to increase the flexibility with which they can be controlled and applied. The key elements in our defense program include: a strategic offensive force which would survive and respond overwhelmingly after a massive nuclear attack; a command and control system which would survive and direct the response; an improved antibomber defense system; a civil defense program which would help to protect an important proportion of our population from the perils of nuclear fallout; combatready limited war forces and the air and sealift needed to move them quickly to wherever they might have to be deployed; and special forces to help our allies cope with the threat of Communist-sponsored insurrection and subver sion. Increases in expenditures for the Nation's defense are largely responsible for the rise in the budget of this administration compared to that of its predecessor. For fiscal years 1962 and 1963, expenditures for the military functions of the Department of Defense are estimated at about $9 billion higher, and new obligational authority at $12 to $15 billion more, than would have been required to carry forward the program as it stood a year ago. For the coming year, the budget provides for further significant increases in the capabilities of our strategic forces. including additional Minuteman missiles and Polaris submarines. These forces are large and versatile enough to survive any attack which could be launched against us today and strike back decisively. The programs proposed in this budget are designed to assure that we will continue to have this capability in the future. This assurance is based on an exhaustive analysis of all the available data on Soviet military forces and the strengths and vulnerabilities of our own forces under a wide range of possible contingencies. To strengthen the defenses of the North American Continent, this budget proposes additional measures to increase the effectiveness of our antibomber defense system, continued efforts to im prove our warning of ballistic missile attack, and further research and development at a maximum rate on anti-missile defense possibilities. The budget for the current year provides for identifying and marking available civilian shelter space for approximately 50 million people. This phase of the civil defense program is proceeding ahead of schedule. ahead of schedule. For 1963, I am requesting nearly $700 million for civil defense activities of the Department of De fense, including $460 million for a new cost-sharing program with State and local governments and private organizations to provide shelters in selected community buildings, such as schools and hospitals. Although a global nuclear war poses the gravest threat to our survival, it is not the most probable form of conflict as long as we maintain the forces needed to make a nuclear war disastrous to any foe. Military agression on a lesser scale is far more likely. If we are to retain for ourselves a choice other than a nuclear holocaust or retreat, we must increase considerably our conventional forces. This is a task we share with our free world allies. The budget recommendations for 1963 are designed to strengthen our conventional forces substantially. I am proposing: An increase in the number of Regular Army divisions from 14 to 16. The two new divisions would replace the two National Guard divisions now on active duty and scheduled to return to Reserve status prior to October 1962. A substantial increase in the number of regular tactical fighter units of the Air Force and in the procurement of new fighter and reconnaissance aircraft. These steps will provide more effective air support for our ground forces. Revision of the program for organization and training of the reserve components so they will be better adapted and better prepared to serve in any emergency which requires mobilization. Significant increases in procurement for all of our conventional forces. These forces must be equipped and provisioned so they are ready to fight a limited war for a protracted period of time anywhere in the world. International affairs and finance: A significant change has taken place in our international assistance programs in recent years. Military assistance expenditures are declining to an estimated $1.4 billion in 1963 compared with $2.2 billion 5 years earlier. The more industrialized European countries have almost completely taken over the cost of their own armament. In less developed countries, the military assistance program continues to provide essential maintenance, training, and selective modernization of equipment, with increased emphasis on internal security, including antiguerrilla warfare. On the other hand, expenditures for economic and financial assistance to the developing nations of the world have been increasing and are estimated at $2.5 billion in 1963. These expenditures, largely in the form of loans, will rise further in later years as development loan commitments being made currently are drawn upon. A corresponding increase is taking place in the contributions of other industralized countries. The new Agency for International Development has been providing needed leadership in coordinating the various elements of our foreign aid programs throughout the world. A consistent effort is being made to relate military and economic assistance to the overall capabilities and needs of recipient countries to achieve economic growth and sustain adequate military strength. To make our assistance more effective, increasing emphasis is being placed on self-help measures and necessary reforms in these countries. The authority provided last year to make long-term loan commitments to developing countries will be of invaluable assistance to orderly longrange planning. Efforts will also be made to foster more effectively the contribution of private enterprise to development, through such means as investment guarantees and assistance for surveys of investment opportunities. In August 1961, the United States formally joined with its neighbors to the south in the establishment of the Alliance for Progress, an historic cooperative effort to speed the economic and social development of the American Republics. For their part, the Latin American countries agreed to undertake a strenuous program of social and economic reform and development through this decade. As this program of reform and development proceeds, the United States is pledged to help. To this end, am proposing a special long-term authorization for $3 billion of aid to the Alliance for Progress within the next 4 years. In addition, substantial continued development loans are expected from the Export-Import Bank and from U.S. funds being administered by the Inter-American Development Bank. These, together with the continued flow of agricultural commodities under the Food for Peace program, will mean support for the Alliance for Progress in 1963 substantially exceeding $1 billion. Space research and technology: Last year I proposed and the Congress agreed that this Nation should embark on a greater effort to explore and make use of the space environment. This greater effort will result in increased expenditures in 1962 and 1963, combined, of about $1.1 billion above what they would have been under the policies of the preceding administration; measured in terms of new obligational authority, the increase is $2.4 billion for the 2 years. With this increase in funds there has been a major stepup in the programs of the National Aeronautics and Space Administration in such fields as communications and meteorology and in the most dramatic effort of all-mastery of space symbolized by an attempt to send a man to the moon and back safely to earth. Action is being taken to develop the complex Apollo spacecraft in which the manned lunar flights will be made, and to develop the large rockets required to boost the spacecraft to the moon. techniques of manned space flight, particularly those of long-term flight and of rendezvous between two spacecraft in earth orbit, are being studied both in ground research and in new flight programs. Our space program has far broader significance, however, than the achievement of manned space flight. The research effort connected with the space program-and particularly the tremendous technological advances necessary to permit space flight-will have great impact in increasing the rate of technical progress throughout the economy. Domestic civil functions: Despite the necessary heavy emphasis we are giving to defense, international, and space activities, the budget reflects many important proposals to strengthen our national economy and society. It has been possible to include these proposals without any substantial increase in the total cost of domestic civil functions mainly because of proposed reductions in postal and agricultural expenditures. Some of the more important proposals in domestic civil programs are mentioned below. Agriculture and agricultural resources: In the development of farm programs we are striving to make effective use of American agricultural abundance, to adjust farm production to bring it in line with domestic and export requirements, and to maintain and increase income for those who are engaged in farming. The steps taken thus far, including the temporary wheat and feed grain legislation enacted in the last session of the Congress, contributed significantly to the rise in farm income last year and to some reduction-the first in 9 years in surplus stocks. However, new long-range legislation is needed to permit further adaptation of our farm programs to the rapidly increasing productive efficiency in agriculture and to avoid continuing high budgetary costs. The reduction in agricultural expenditures in this budget-from $6.3 billion in 1962 to $5.8 billion in 1963-reflects the proposals to this end which I shall be presenting to the Congress in a special message. The 1963 budget also provides for expansion of the food stamp plan into additional pilot areas, and for a substantial increase in Rural Electrification Administration loan funds-to permit financing of additional generation and transmission facilities where that is necessary. The adequacy of the funds recommended will depend on the willingness of other power suppliers to meet the requirements of the rural electric cooperatives on a reasonable basis. Natural resources: Estimated expenditures of $2.3 billion in this budget for the conservation and development of our natural resources are higher than in any previous year. The 1963 budget makes provision for the Corps of Engineers, the Bureau of Reclamation, and the Tennessee Valley Authority to start construction on 43 new water resources projects with an estimated total Federal cost of $600 million. The long-range programs for the national parks and forests are also being strengthened. One of our most pressing problems is the adequate provision of outdoor recreational facilities to meet the needs of our expanding population. The Federal Government, State and local agencies, and private groups must all share in the solution. By the end of this month the comprehensive report of the Outdoor |