[Congressional Record Volume 144, Number 145 (Tuesday, October 13, 1998)]
[Extensions of Remarks]
[Pages E2110-E2112]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




           SALUTE TO JACK CORRIGAN: MR. ECONOMIC DEVELOPMENT

                                 ______
                                 

                       HON. SHERWOOD H. BOEHLERT

                              of new york

                    in the house of representatives

                       Tuesday, October 13, 1998

  Mr. BOEHLERT. Mr. Speaker, on Monday, July 13, 1998 it was my 
privilege to share in a special retirement ceremony for one of the 
finest, most decent, most caring, sharing individuals I have ever 
known.
  On that day, in Philadelphia, local, state, and national leaders 
joined in honoring Jack Corrigan upon the occasion of his retirement 
after Nearly 30 years of distinguished service in the U.S. Department 
of Commerce's Economic Development Administration.
  There is so much to be said about Mr. Corrigan's superb public 
service. It can best be summed up by noting that in 1995 he received 
the Lifetime Achievement Award for excellence in the field of economic 
development from the National Council on Urban Economic Development for 
his innovative economic development, thought, and leadership.
  One of the old pros in the economic development field is a long-time 
good friend, Dave Rally, currently Legislative Advisor to the Public 
Works and Economic Development Association.
  When I mentioned to Mr. Rally that I would be participating in the 
salute to Jack Corrigan, he immediately recalled what he termed ``one 
of the best speeches ever'' on the subject of economic development. 
Guess who gave it? Jack Corrigan. Mr. Rally was so impressed by the 
speech that he kept it at the ready and quickly retrieved it more than 
three years after it was given.
  I, too, was greatly impressed, so much so that I append it here to my 
remarks with the thought that a reading of this ``insider's look'' at 
the role of the Federal Government--an historical perspective--will be 
enlightening, instructive and inspiring for all.
  Jack Corrigan brings credit to the title public servant. His 
dedication and good work enriched the lives of literally hundreds of 
thousands of Americans and helped transform areas of distress into 
zones of opportunity. What a magnificent legacy!

    EDA and the Federal Role in Economic Development--An Historical 
                              Perspective

 (Address by John E. Corrigan, Director, Philadelphia Regional Office, 
      Economic Development Administration, EDA Regional Meeting, 
                   Philadelphia, PA, February, 1995)

       This year marks the thirtieth anniversary of the Public 
     Works and Economic Development Act of 1965 (PWEDA). Yet what 
     should be a year to celebrate the effectiveness and 
     contribution of the Economic Development Administration (EDA) 
     may become a year when EDA faces the most serious threat to 
     its very existence. In the weeks and months ahead there will 
     be a national debate that will challenge the validity of 
     concepts that are the reasons why EDA was created and 
     sustained for the past 30 years.
       We, the true believers, must not simply dismiss those who 
     see no reason for our existence as simply mean spirited 
     heretics but rather in the coming months we must engage them 
     in a discussion of ideas. As Peter Drucker observed: ``Every 
     person and institution operates on the basis of a theory 
     whether they realize it or not.'' EDA is a response to a 
     specific theory about development. Those who seek our 
     elimination have a very different theory of development.
       There is little disagreement in the United States that the 
     existence within our country of hundreds of areas of very low 
     income and of persistently high unemployment is a national 
     concern. The question which is in dispute is whether the 
     Federal government ought to make efforts to alter the 
     productive structure of such areas so that they may maintain 
     their level of population, balance their trade with competing 
     regions, and achieve a rate of growth in their per capita 
     incomes which approximates the national rate by making those 
     areas more competitive. There are two quite distinct theories 
     on this. Proponents of the National Demand approach, also 
     known as the Market approach, assert that over the long term 
     the competitive forces of the market do create an optimal 
     spatial distribution of economic activity. The private sector 
     will locate where costs are least and profits greatest. 
     Therefore if any area does show persistent symptoms of severe 
     distress this should be interpreted as a clear warning that 
     the nation has a declining need for this particular part of 
     national space. We can let it deteriorate. The alternative 
     thesis, which can be called the theory of Planned Adjustment, 
     assumes that local economic problems persist precisely 
     because competitive forces do not create an optimal spatial 
     distribution of economic activity. Thus the lagging regions 
     suffer not only because of the internal misuse of their 
     resources but also because external investors, who are 
     unaware of the favorable opportunities for investments in 
     such areas, continue to pour funds into the overexpanded 
     metropolitan areas within growing regions. These areas are 
     lagging, in part, because they are not able to invest in 
     infrastructure, both human and physical, which would make 
     the area economically profitable to the private sector. 
     Such deficiencies in the market system, it is argued, can 
     be overcome by planning for the adaption of the supply 
     characteristics of the lagging regions (investing in 
     infrastructure, including capacity as well as bricks and 
     mortar) so that they become self-sustaining, retain their 
     population, and attract investment from the oversized 
     metropolitan areas.
       Because he believed in the first theory of development, the 
     National Demand model, the Market model, President Nixon in 
     1972 called for the termination of EDA and stated boldly: 
     ``There is no need for a national development policy''. And 
     in 1980, President Jimmy Carter's White House Conference on 
     Balanced National Growth and Economic Development, much to 
     our surprise, recommended that the solution to the problem of 
     distressed areas was for the federal government to provide 
     assistance so that citizens could move to more prosperous 
     areas reflecting clearly a belief in this first theory of 
     development--vote with your feet. And President Reagan after 
     recommending the elimination of EDA in this State of the 
     Union message in January 1981, explained his position further 
     by stating: ``The administration intends to deal with 
     economic development at the subnational level by improving 
     the national economy.''
       In response we need to loudly proclaim that this theory of 
     economic development espoused by President Nixon, by 
     President Carter's Balanced National Growth Conference and by 
     President Reagan is wrong, that it has no historic basis in 
     fact and that it has not been our national economic policy 
     for the past 150 years.
       In a Senate Speech in 1981, defending EDA, Senator George 
     Mitchell outlined that history.
       In 1850, when it became apparent that the success of the 
     Eastern States in building their rail networks promised an 
     increase in wealth for the entire eastern seaboard, Congress 
     enacted the Railroad Land Grant Act--truly landmark 
     legislation--to encourage, by Federal subsidy, the expansion 
     of the rail network in the South and West. And for 21 years 
     thereafter, Congress continued to grant rail land rights. One 
     Hundred Thirty One million acres to land were granted for 
     that purpose--a Federal subsidy for Western

[[Page E2111]]

     and Southern economic development whose worth cannot be 
     calculated at today's prices. Beginning in the 1880's, 
     hydroelectric power was aggressively developed with federal 
     aid.
       By 1902, 30 years of homesteading acts had not been enough 
     to encourage the settlement of the arid parts of the West, so 
     Congress enacted the Reclamation Lands Act of 1902, a 
     regional economic program which has changed the face of the 
     country. Under the Reclamation Act water projects were built 
     in 17 Western States to irrigate arid land. Some of our great 
     cities--Phoenix, Denver, Los Angeles--could not exist without 
     that water. The Imperial Valley in California, the most 
     productive farmland in the Nation could not produce without 
     it. And, as one result, Western lands with less than 9 inches 
     of rainfall each year now produce and agricultural product 
     worth $4.4 billion. All based on the theory of the importance 
     of the Federal role in economic development.
       In the 1930's, when the great depression was at its worst, 
     Federal funds were poured into regional efforts to help 
     provide employment and economic growth in the West and South. 
     The massive Bonneville hydro project on the Columbia River 
     was built to provide employment in the Pacific Northwest. 
     Today, a potato processing plant in Washington State pays 
     one-fifth the rate of electricity that a similar plant pays 
     in the East because of Bonneville power and the other Federal 
     hydro projects in Washington.
       The greatest of the regional development programs, the 
     Tennessee Valley Authority, is still benefiting its seven-
     State area. Its series of dams, reforestation projects, power 
     plants and fertilizer plants have lifted a region which was 
     in the depths of poverty in 1933--its people then earned 45 
     percent of the national average income--to a thriving and 
     economically productive region today.
       This massive Federal assistance to the South and the West 
     over the past century has given those areas a basis from 
     which today's rapid rate of economic development flows. It 
     was grounded in the recognition that not all regions of the 
     country have identical needs, that they do not move forward 
     in lockstep, and that help is needed at different times by 
     different parts of the country.
       Then in 1956, at the urging of the Eisenhower 
     Administration, Congress passed The Federal Aid Highway Act 
     which began the largest Economic Development project in human 
     history. The project resulted from extensive national and 
     regional planning and the total cost of the system is 
     estimated at $129 billion. Its effect was to open the way for 
     development in our suburbs, exurbs, and outlying rural areas.
       No need for a national development policy--no need for 
     federal intervention? The history of our country belies those 
     statements.
       Thus EDA owes its existence to the second theory--That of 
     Planned Adjustment--which has been a national policy since 
     1850. However, politically, EDA exists as a result of a 
     National debate that took place after the Second World War 
     concerning the need for a targeted development program.
       Some of you may remember as I do that the way that debate 
     was framed in the 1950's was in the form of a question: ``If 
     we can assist all of those countries in Europe with a 
     Marshall Plan, shouldn't there be a Marshall Plan for our 
     distressed areas?''
       In Congress, Senator Paul Douglas of Illinois was the 
     champion of such an approach and legislation was drafted and 
     passed and twice vetoed by President Eisenhower. But support 
     for such a program was building and legislation creating The 
     Area Redevelopment Administration (ARA) was the first bill 
     that passed the Senate and was signed by the newly elected 
     President John F. Kennedy in May 1961. President Kennedy was 
     enthusiastic about the program having experienced the depths 
     of rural poverty when campaigning in West Virginia and other 
     parts of Appalachia in the Primary race against Hubert 
     Humphrey. During its four year history ARA obligated $350 
     million for projects authorized by its enabling legislation 
     and another $851 million for public works projects under the 
     Public Works Acceleration Act of 1962.
       During 1965 a consensus was reached in Congress that the 
     ARA approach was valid but that it needed to be refocused. 
     Thus on August 26, 1965, President Johnson signed the Public 
     Works and Economic Development Act. The new legislation 
     reaffirmed the ARA mission of permanently alleviating 
     conditions of substantial and persistent unemployment and 
     underemployment in distressed areas and emphasized the 
     related goal of stemming outmigration from such places. PWEDA 
     also stressed the need to encourage expanded development in 
     the natural growth centers of depressed areas and the 
     importance of long-range economic planning.
       In sending the EDA legislation to Congress for enactment on 
     March 25, 1965, President Lyndon Johnson said: ``The 
     conditions of our distressed areas today are among our most 
     important economic problems. They hold back the progress of 
     the Nation, and breed a despair and poverty which is 
     inexcusable in the richest land on earth. We will not permit 
     any part of this country to be a prison where hopes are 
     crushed, human beings chained to misery, and the promise of 
     America denied.''
       Those words ring true today as they did 30 years ago.
       EDA's advance over ARA and its originality is that it seeks 
     to generate a process of economic development in specific 
     areas of the country. The focus from projects to process was 
     a key change from ARA to EDA. The Overall Economic 
     Development Program, although not always properly implemented 
     remains today a major contribution to economic development 
     practice.
       Another unique characteristic of EDA is the role of the 
     Economic Development Representatives (EDRs). There is no 
     other position like it in the Federal Government. The EDR 
     heads a one person office in charge of one or more states. 
     Because the EDRs are close to the economic problems of their 
     areas and close to the people involved in them is a reason 
     why they are so effective and important to EDA. Also the EDR 
     reports to the Regional Director who reports to the Assistant 
     Secretary. That flat organizational structure has resulted in 
     many instances where an EDR talks to the Regional Director 
     who talks to Headquarters and in a matter of hours an 
     application is invited or a problem is solved. No other 
     Federal program operates that way.
       Now what shall we say about our collective experience in 
     EDA--almost 30 years and $16 billion later. Let us review 
     some of the highlights of our proud heritage.
       We know that jobs spring from ideas and EDA showed the way 
     and responded to need in dozens of initiatives. Who could 
     count the jobs that have resulted. Is three million jobs an 
     inflated number? Probably not.
       EDA showed the way in 1967 with the designation of the 
     first Economic Development District and today 315 Districts 
     testify to the wisdom of a regional strategic planning 
     approach.
       EDA showed the way in 1969 in responding to the closing of 
     the Brooklyn Navy Yard and made substantial investments in 
     its rehabilitation for industrial and commercial use. That 
     defense adjustment initiative continued through the 70's and 
     80's and 90's and continues today with $120 million of our FY 
     1995 budget dedicated to Defense Conversion.
       EDA showed the way in 1969 in its prompt response to the 
     ravages of Hurricane Camille in Mississippi and set in motion 
     a role that continues in this fiscal year in our efforts in 
     Georgia, Alabama and Florida in response to Tropical Storm 
     Alberto, and in many major natural disasters in recent years, 
     in Florida after Hurricane Andrew, the 1993 midwest flood, in 
     California after the January 17 Northridge earthquake and in 
     New England coping with the depletion of the fish stock. EDA 
     showed the way in long term disaster recovery because we 
     could deliver in ways that no other agency could.
       EDA responded in 1974 by promptly administering a $500 
     million Title X program.
       EDA was also a leader in 1974 with amended legislation 
     creating the state and urban planning program and promoting 
     the idea of linking the planning with the budget cycle and 
     both to the executive decision making process.
       EDA led again in 1975 with the introduction of the Title IX 
     program. Twenty years later the RLF program alone has 
     approved $400 million and leveraged $2.4 billion in 
     private lending. And who could count the jobs?
       And EDA did the job in 1976-77 with the Local Public Works 
     Program (LPW). Over a thousand projects were approved and $6 
     billion obligated in twelve months. All 10,000 projects were 
     processed in 60 days or less. We will never forget the 12 
     hour days and the countless Saturdays, but EDA did it.
       Although physically and emotionally exhausted, EDA 
     employees again responded in 1977 when a drought devastated 
     parts of the country, especially in the Southwest and EDA 
     processed an additional $175 million in water projects. In 
     that program projects were processed and approved on average 
     within seven working days after receipt of the application. 
     Many projects arrived on a Monday and were approved that 
     Friday.
       EDA responded in 1978-79 when it administered $100 million 
     dedicated to the XIII International Winter Olympic Games in 
     Lake Placid, New York. EDA was the principal federal agency 
     associated with the games and projects under EDA's 
     supervision were built on time and within budget.
       EDA also responded in 1983 and administered $140 million 
     for the Emergency Jobs Act.
       In 1993 in response to the declining timber harvests in the 
     Northwest, EDA was the lead federal agency in providing 
     resources to hire local staff in Districts and counties so 
     that all communities in the region had the capacity to 
     respond to the crisis and develop a strategy for investing in 
     the locally established priorities.
       During the 30 years of our history EDA was recommended for 
     zero funding in the President's budget for 16 of those years 
     and yet during all of those 30 years EDA has been a leader.
       EDA provided the investment for the first publicly funded 
     incubator building in this country.
       EDA provided Competitive Communities type funding for one 
     the first federally assisted Employee Stock Ownership Plans 
     (ESOP) in the country, South Bend Lathe in Indiana.
       EDA popularized RLF's when many questioned the concept.
       What is the proudest achievement of all? It is that EDA 
     created the Economic Development Profession. Thirty years ago 
     there was no such thing. But EDA has created the profession 
     through its funding of District staff and the early days of 
     the 302(a) program when we funded an economic development 
     staff in virtually every state and every major city in the 
     country. Because of that, most of them, for the first 
     time, had an economic development capacity.
       Thirty years ago there were virtually no graduate courses 
     in economic development

[[Page E2112]]

     in this country and hardly any articles in professional 
     journals. Through EDA's Research and Technical Assistance 
     programs, we have funded the thinkers and theorists who are 
     developing the idea that will influence tomorrow's national 
     development process.
       Now as we look at the present we should be gratified that 
     for the first time in 30 years we have a Secretary of 
     Commerce, Ron Brown, who has testified on behalf of EDA 
     before our committees and who strongly supports EDA.
       We have the leadership of Assistant Secretary Ginsberg who 
     is developing a strategic vision for a new EDA--an EDA that 
     will involve change--change which we must be prepared to 
     embrace. He is the only Assistant Secretary EDA has had who 
     is an economic development professional. Under his guidance, 
     new programs are being developed. You will hear later about 
     our Competitive Communities initiatives which will build a 
     new economic base of globally competitive, high growth 
     companies.
       In addition, how thankful we all are for the actions of 
     Assistant Secretary Ginsberg who announced on June 1, 1994 
     the delegation of grant making authority from Washington to 
     the regions, eliminating duplicative and redundant 
     procedures. How important that is for all of us.
       The Assistant Secretary is also committed to making the 
     agency more responsive to our clients though simplifying 
     agency applications and by completing the review of 
     applications in 60 days or less. We did it in LPW--we did it 
     in the Drought program. We have done it in recent months in 
     our Disaster recovery efforts--we will do it.
       What else must we do? Assistant Secretary Ginsberg has 
     given us a charge to mount an extensive outreach to 
     articulate EDA's new role and its continuing importance to 
     America's local communities. Our grantees are ready for that 
     and they will respond.
       Last month I asked each of my EDR's to prepare his or her 
     own outreach plan to get the message out. Charlie Hammarlund, 
     our EDR for Connecticut and Rhode Island, who incidentally is 
     celebrating his 45th year of federal service, in this plan 
     stated: ``I did not have to reach out to the economic 
     development community in Connecticut and Rhode Island, they 
     reached out to me. They were aware of our concerns and they 
     told me what they were doing.''
       I know all of you are involved in this outreach process and 
     we must not simply depend on the vigorous commitment and work 
     by our leaders in Washington. A few week ago I was discussing 
     this outreach effort with the Public Works Chief in Denver, 
     Charlie Lee, and he said: ``Jack, in our office we have 
     discussed this and we believe that it we do not aggressively 
     get the word out, our lack of action would be the very thing 
     that causes EDA to die.''
       There is great wisdom in this thought. Today, more than 
     ever all of us in EDA must be sustained by the spirit of 
     hope. Not a hope that is a distant wish. But a hope that is 
     creative force--that is active--that makes things happen.
       For example, if people in EDA would say, ``We've survived 
     in the past--but this time the pressure is too great and 
     we're not going to make it''--and I have heard those thoughts 
     expressed by some of you--the very saying of those words 
     repeated by enough people creates a life of its own and 
     increases the change of failure. But if you say: ``Look at 
     what EDA has done--look at all of the people who believe in 
     us and depend on us. I am going to contact everyone of them 
     and make sure that they let all of the EDA family (grantees 
     and businesses, our beneficiaries) know how important EDA 
     is,''--those very words have their own dynamic life and 
     increase in a sure and real way EDA's continuing existence.
       For it is the creative hope within us that makes a 
     difference--that makes things happen. Finally, I would ask 
     you to reflect on the words of Bobby Kennedy and make them 
     your own. Shortly before he died he spoke to the students at 
     Fordham University: ``Our future may lie beyond our vision 
     but it is not completely beyond our control. It is the 
     shaping impulse of America that neither fate nor nature, nor 
     the irresistible tides of history, but the work of our own 
     hands will determined our destiny. There is pride in that, 
     even arrogance but there is also experience and truth. And it 
     is the only way we can live.''
       ``It is the work of our own hands that will determine our 
     destiny.''

     

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