of this phasing period also would be fair to the Postal Service. It would not reduce Postal Service income by 1 penny or in any way impede attainment of the "honest, efficient, and economical management" to which the public and all mailers are entitled under the act.

SUMMARY

Mr. Chairman, I doubt that anyone else could state the case for literary, cultural, and educational mail as cogently and effiectively as it was presented in the testimony by Representative Ford yesterday. He demonstrated a remarkable grasp of the important issues before the subcommittee, as well as postal affairs in general. Also, as noted by Mr. Ford following my testimony before the subcommittee last June, the extremely heavy increases in postal rates already approved, as well as the additional increases currently sought by the USPS, fly in the face of our national policy expressed by Congress in the National Foundation of the Arts and Humanities Act of 1965, as well as the expressions of Congress in forming the Postal Service in the 18th century. This policy has been affirmed and reaffirmed through the ensuing years by both Congress and successive Chief Executives in funding the National Foundation to further encourage and perpetuate art and cultural activities in the country, and to assure easy and continuing access to these by the American people. Yet the demands of the USPS are diametrically opposed to the congressional determination that the best interests of the nation are served by strong Government support of the literary and cultural values of the people.

We believe the record clearly demonstrates that books, sound recordings and other special fourth-class mail have shared equally, and will continue to share equally with other classes of mail, in ably serving the literary, cultural, educational, and informational interests of the public, thereby enhancing the American way of life. Unfortunately, there is often a tendency in today's commercial world to undervalue the arts and other cultural pursuits. This we believe, is not only a mistake, it is unrealistic because we also believe that man does not live by bread alone. One of the most disappointing and damaging features of the first USPS rate proposal was the insistence by the Postal Service that literary, cultural, educational, and informational mail is entitled to absolutely no consideration under rate proceedings under the act. In effect it expressed an opinion that a package is a package regardless of its contents. The contrary view, expressed by the hearing examiner, was in our opinion a correct understanding of congressional intent. Unfortunately, as pointed out earlier, that view was not fully sustained in the subsequent decision at a higher level. Therefore, the intention of Congress should be spelled out unmistakably at this time in language explicitly requiring consideration by the Postal Rate Commission of the cultural, scientific, educational, and informational value of mail matter to the recipient.

It is not our intention at this point to belabor the deplorable and and deteriorating condition of the postal service in our country

today. We think this has already been amply covered in previous testimony. I believe that you yourself, Mr. Chairman, suggested that it would take about ten years to bring about any meaningful improvement in postal operations in this country. We believe that a similar phasing period should be granted to mail users so that they are not unjustifiably burdened by continuous rate increases along the line. For mailers to be expected to shoulder the burden of rate increases engendered by inefficient operations and faulty cost allocation methods is manifestly unfair. The creation of USPS has done little to improve service, eliminate inefficiency, or cut costs. The biggest thing it has done is to eliminate the concern and responsibility for the public welfare that has been traditionally exercised by the Congress.

For that reason, we strongly urge you to incorporate the provision of 528 in any bill reported by the Subcommittee. Thank you.

Mr. HANLEY. Thank you very much, Mr. Brief, for your excellent testimony. I appologize for our time problem this morning. I regret that it has run out on us. But in behalf of the committee, our appreciation to you and Mr. Johnson for your appearance and your input into the deliberations of the subcommittee. As I have said previously this morning, hopefully through the course of the months ahead, we can unravel many of the things that we find so troublesome related to the U. S. Postal Service.

The meeting stands adjourned until April 4, at that time we will again convene with a hearing and the witness will be the former Postmaster General J. Edward Day.

[Whereupon the hearing was adjourned at 12:20 p.m.]

[The statements and letters which follow were received for inclusion in the record at this point:]

STATEMENT OF ANDREW J. BIEMILLER, DIRECTOR, DEPARTMENT OF LEGISLATION, AMERICAN FEDERATION OF LABOR AND CONGRESS OF INDUSTRIAL ORGANIZATIONS This statement represents the views of both the AFL-CIO and the International Labor Press Association on the scheduled series of postal rate increases confronting trade union journals and, in fact, all non-profit secondclass publications.

The ILPA comprises some 400 magazines and newspapers issued by the AFL-CIO and its affiliated unions and represented those publications throughout the Postal Rate Commission proceedings, unfortunately without avail.

As a one-time labor editor myself, I have some familiarity with the financial problems encountered by union publications in attempting to maintain a continuing avenue of communication with rank-and-file members. These problems, however, ultimately are the responsibility of the publishers of the labor press -the trade union organizations that pay the bills. Thus, the AFL-CIO and its affiliates have a direct interest in these proceedings.

We feel, too, that there is another interest involved-the public interest in the free flow of ideas, opinion and information.

It was that public interest which concerned the Founding Fathers when they first created the postal system. And it was that public interest the Congress had in mind when over the years it established a structure of lower postal rates for newspapers and then a rate differential between commercial and non-profit publications.

Now, that very public interest is in danger of being trampled by exorbitant rate increases imposed by the Postal Rate Commission on non-profit secondclass publications. This is no idle exaggeration. The first step in the Commission's ten-year schedule for non-profit publications became effective last

July. It amounted to a 100% increase in the effective per-piece rate and was enough by itself to force the suspension or curtailment of a number of struggling union papers. The second step in the rate schedule is due next July, and we dread the prospect of more casualties.

Contrary to the apparent position of both the Postal Service and the Postal Rate Commission, we do not believe this is a result Congress anticipated when it enacted the Postal Reorganization Act, and we welcome the reexamination of these problems by this Subcommittee. For all non-profit publicationswhether issued by labor, church, educational or veterans' groups, by liberal or conservative organizations-the postal rate burden is ominous and time is critical.

We want to make it clear that we have no interest in what the Postal Service asks or gets in the way of rates on advertising content. Our interest is in the rates charged for transmission through the mails of information, ideas and opinion by the periodicals of non-profit organizations, for the mails are very often the only channel available to these organizations for the dissemination of their views and viewpoints.

Obviously, within the non-profit group our special interest is in the trade union press. ILPA's membership of some 400 journals includes about 50 weeklies, 25 biweeklies, one triweekly, more than 200 monthlies, 30 bimonthlies, 30 quarterlies and a number of publications whose schedules are erratic. The figures are not precise because, as a voluntary association, we lose and gain affiliations from year to year; and because trade union publications as a whole are so precariously established that their frequency of issue and, indeed, their very survival are sensitive to even the gentlest winds of change. Of the publications above, some 105 are produced by national and international unions affiliated with the AFL-CIO. Just under 80 are owned or sponsored by state or (mostly) city-county central labor bodies. The remainder are organs of local unions.

ILPA includes almost all the bona fide, printed periodicals of unions affiliated with the AFL-CIO.

All these publications have two characteristics in common.

First, they are small. A few magazines may run to as many as 40 pages. a few tabloid newspapers may reach 24 pages. But the median, regardless of format, is about the equivalent of a 12-page tabloid.

Second, these publications are poor. Three-fourths of them are entirely financed by membership dues. Nearly 100 do accept advertising as a matter of necessity, but as noted later, few get much of it and nearly all of them are afflicted with chronic financial problems.

Unfortunately, the managers of the Postal Service appear to regard small, poor periodicals as nuisances to be eliminated. With the approbation of the Postal Rate Commission, it imposed upon them by far the heaviest proportionate rise for any type or category of mail.

Here, in summary, is what happened:

Early in 1971 the Postal Service proposed to raise the minimum secondclass rate for publications of non-profit organizations by 750% over a tenyear period, with a 100% increase effective at once. This proposal was subsequently accepted without change by the hearing examiner and by the Postal Rate Commission.

Substantial increases were also promulgated for pound rates, which will bring about an overall rise in excess of 800% for some periodicals for example, about 815% for a typical eight-page tabloid newspaper.

These figures are not in dispute. On the contrary, the Postal Service seems to be rather proud of them.

The basis for this sensational increase is a per-piece surcharge, over and above any other postage rate paid by publications in the non-profit, secondclass category.

The smallest, lightest, thinnest-and, almost by definition, the poorestpublications traveled at a minimum rate of 0.2¢ a copy before the rate proceedings began.

This minimum-according to the Postal Service-won't change a bit. Even after ten years, the minimum per piece will still be 0.2¢.

This is what the Postal Service says, but the reality is quite different. The difference lies in a sort of super-minimum in the form of a surcharge.

The surcharge started at 0.2¢ in July 1972 and will proceed in alternate steps of 0.1¢ and 0.2¢ until it reaches 1.5¢ in 1981. The next increment is due to fall in July of this year.

So the smallest, lightest, thinnest and poorest publication, the one that paid 0.2¢ in 1970, will be paying 1.7¢ a copy for postage in 1981-provided it survives at all.

This formula was described by the hearing examiner, in words warmly endorsed by the Postal Rate Commission, as "an imaginative and economically sound method" of improving the rate structure. From the viewpoint of nonprofit second-class publications, such a description makes the mind reel.

The idea of a surcharge is not novel. It was proposed, in one form or another, by various Postmasters General, four times in the last decade. Each time it was rejected by the Congress, and for excellent reasons.

The surcharge is just about as "imaginative" as the poll tax-and just about as obnoxious. It is a capitation tax, one that means very little to large taxpayers but is catastrophic to small ones.

As ILPA argued in the rate hearings, the result will be to silence minority voices unless they are rich. These minority voices have already been hit by the initial 100% increase in their minimum postage rate, and the second step next July will amount to 50% of the former minimum.

Not only trade union publications are bearing the brunt of this. Equally affected are church bulletins, and college alumni newspapers, and the conservation people-and yes, the chambers of commerce. All of these, and many more, are part of the chorus of democracy. And all but the wealthy ones will be throttled by the postal rates presently scheduled. As we have said, some are gasping already, and some have expired.

The labor press-apart from its role as advocate and adversary, and that's enough to justify it-performs a great many nuts and bolts tasks, including some mandated by the government of the United States. We believe its healthy survival is very much in the public interest.

The labor press is the principal line of communication between the union and the members often the only one. It's where the members find out what's going on in the organization, and in the labor movement-information that is available nowhere else. And the labor press is the instrument-the virtually indispensable instrument-through which unions carry out obligations legislated by Congress in the Landrum-Griffin Act. Periodic financial reports, for example, and timely notice of elections are distributed to the members in the pages of the labor press.

Certainly, the dissemination of this information is not only in the best interests of the union and its members, but essential to the public interest as well. Yet the postal rate increases now being imposed will seriously impede union communications at every level.

We realize there are some who question the magnitude of the rate problem to trade unions generally. One of these questions is the ability to pay.

The first point to be considered in that connection is that unions are not in the publishing business. Their periodicals are simply instruments employed in carrying out their primary functions-even though, as noted, they are wellindispensable within that range.

Nearly three-fourths of the ILPA's member publications are financed entirely by membership dues. They accept no advertising, and they sell very few subscriptions to non-members. They are expense items in the budgets of their unions, and they are weighed on the same scales as all other items.

The Postal Service argues that the impending increases, though large in percentage, are small in dollars. This simply isn't so, even at the first step. Here are two examples.

The Machinists' union publishes a weekly newspaper which is generally conceded to be excellent, even though it has shrunk from 12 pages to eightin part because of postal rates.

The first-step surcharge of 0.2¢ a copy is costing the Machinists more than $1,800 a week above their pre-hearing rate. The increase after ten years will be almost $14,000 a week, or about three-quarters of a million dollars a year.

This is ten times the rate of increase that could reasonably be anticipated in the general costs of operation. And it is a substantial item, even to a large union like the Machinists.

Obviously, the elected leaders of the Machinists' union, as responsible men, will have to consider very seriously the wisdom of spending an additional three-quarters of a million dollars on postage for the union newspaper. They will have to weight this extraordinary sum against the many other valid claims on the dues dollar-the administration of contracts, educational programs, economic research, organizing-the whole range of services that a modern union must provide. Although it is highly unlikely that the Machinists would discontinue publication entirely, a very drastic curtailment would appear to be inevitable.

For my second example I will go to the other end of the scale in terms of size and resources-to the typical weekly publication of an AFL-CIO central body.

These are the community labor papers which bring to their readers the trade union news that concerns them most-the news with a local angle. There are fewer than 50 such weeklies left, and another 25 or so biweeklies that seek to fulfill the same function.

The reason there are so few of these papers is simple: The money isn't available to support them. They are the organs of central bodies that subsist on an average per capita payment of about 10¢ a member a month. To exist at all, these papers must attract advertising. This would be difficult under any circumstances; it is much harder because of the severe restrictions imposed by ILPA and by the AFL-CIO itself on the kind of advertising that is acceptable. For example, the AFL-CIO recently forbade these publications to accept political advertising of any description.

Under the most favorable terms, an eight-page weekly tabloid newspaper with a circulation of 30,000 or more copies will cost at least 4¢ a copy to produce and distribute. Thus it starts by costing more than the per capita income of the central body; it survives, precariously, on local union subscriptions plus the limited amount of advertising obtainable. Under these conditions, any postage increase will create a problem. A very large increase in many cases will compel the suspension of publication. The first-step raise has already caused curtailments.

This does not mean that the labor press expects to escape a rate increase entirely. The increases in pound rates in the new schedule would amount to nearly 140% over ten years. This is generally in line with the pound rate increases imposed on second-class mail generally; they may be painful, but they would, by themselves, be endurable.

What we cannot endure is the unfair and regressive surcharge. It is the surcharge that threatens so many of our publications with disaster.

We realize that the bill introduced by Mr. Udall, joined by many members of this committee and others, now known as H.R. 4127-28, would not abolish the surcharge. We very much regret this, and we urge the Subcommittee to explore an approach to the non-profit second-class rate question that would remove this burden.

However, if this Subcommittee declines to attack the surcharge frontally, H.R. 4127-28 represents a minimum measure of relief that would enable most trade union publications to survive. We must emphasize the word minimum. This bill would still leave us saddled with an enormous increase something on the order of 400% over ten years. That's too much and, as before, it hits hardest at those who can bear it least. But it is preferable to extinction.

It must also be emphasized that any measure of relief for non-profit secondclass publications, even a proposal that they travel free, need not create any insuperable problems for the Postal Service. All the non-profit second-class mail combined amounted to only one-tenth of one percent of the total postal revenues under the previous rates. The Postal Service argues that this tiny percentage translates into a large number of dollars. The number of dollars is large by most standards of income. It is large compared to the resources of the organizations from which it would be extracted; but it is small compared to the gross receipts of the Postal Service.