Congress: Quarrel Over Sharing

THE scene in the cavernous committee room was deceptively calm. Wilbur Mills of Arkansas, chairman of the House Ways and Means Committee, was smiling and attentive. The chief witness, Treasury Secretary John Connally, was relaxed and cordial. There was little outward sign that these two wily, vastly experienced politicians were meeting in a head-on clash over the Nixon Administration's top-priority bill, the measure that proposes to share an initial $5 billion a year in federal revenues with the states and cities.

For months before last week's confrontation, Vice President Agnew had traveled around the U.S. drumming up support for the measure, while Mills went cross-country to denounce it before half a dozen state legislatures. Now that the battle was finally joined on Capitol Hill, the amicable charade was quickly ended. Connally had no sooner finished his 15-minute presentation in favor of the bill than Chairman Mills showed his hand. "I want to congratulate you," he told Connally, "for making a very fine statement in behalf of a very weak cause." The other members of the committee then proceeded to probe the weak points skillfully.

Representative Sam Gibbons of Florida complained that the bill allots money to a city in proportion to the amount of tax revenue the city raises. This means that heavily taxed but not so needy cities would get more aid than impoverished communities whose tax base has steadily eroded. Comfortable Newton, Mass, (pop. 91,066), would get $1,527,668 v. only $821,964 for decaying New Bedford (pop. 101,777). "This formula doesn't do anything but put money where the wealth is," said Gibbons. When Ohio's Charles Vanik argued that the 25 largest cities in the U.S. would receive only one-quarter of the $5 billion, Connally bluntly confessed: "This is not a bill to relieve the urban crisis." The Administration, said Michigan Democrat Martha Griffiths, wants to give money to Podunk in order to win as many votes as possible. "Podunk is part of America," snapped Connally. "It is impossible to devise a formula that will answer the problems of all 38,000 political subdivisions of this country."

Representative Griffiths went on to complain that some states should not receive federal funds because they do not tax themselves enough. Connally retorted that that was "not fair." When he served as Governor of Texas, he said, he raised taxes at every session of the legislature. "Does Texas have an income tax?" asked Representative Griffiths. "No, ma'am," Connally replied, almost contritely. Said Griffiths: "Well, Michigan does have an income tax. I'm not interested in Michigan paying any more to help Texas meet its problems."

By noon of the first day of hearings, it was publicly plain that the bill had no chance in committee, much less in the House. Of the 25 committee members, only four--all Republicans--spoke in favor of it. One of them, New York's Barber Conable, was so persuasive that Connally suggested that he should be the chief spokesman for the bill. No one disagreed. Connally was not in this instance playing his usual role of supersalesman. Mills was overheard saying: "His heart was not in it." When Tennessee Democrat Richard Fulton ended his questioning, he told the Secretary: "I do not want to be premature, but I do tender you my condolences."

Dead or Alive. Connally's faltering was not all his own fault. He was led down the garden path by Wilbur Mills, a longstanding opponent of the revenue-sharing concept. Mills is determined to discredit Nixon's economic policies and --if possible--kill the revenue-sharing plan forever. This is a matter of not only political philosophy and party loyalty, but also presidential ambition as well. Mills wants to see the Democrats defeat Nixon in 1972; he is also beginning to think that he may be the man to do it. Mills is now taking his presidential candidacy somewhat more seriously than at first.

Mills is inviting the nation's Governors and mayors to testify in the weeks ahead. He expects their testimony to undermine whatever little remains of Nixon's case for revenue sharing. Things may not necessarily work out that way, however. Many of the Governors, and especially the mayors, have grown enamored of the sharing idea. Once such a goody has been dangled before them, they are not likely to let it be taken away. When Senator Muskie seemed to be backing away from revenue sharing a couple of months ago, the mayors set him straight with dire warnings of political reprisal. Muskie got the message. At the same time that Connally was testifying, a Senate subcommittee was holding hearings on Muskie's own revenue-sharing bill--a plan that would provide $6 billion to the states and localities instead of the Administration's $5 billion and would apportion it at least partly on the basis of need. Muskie's bill stands no greater chance of passage than Nixon's.

For all their political differences, the mayors, Mills and Nixon might find themselves not so very far apart in the long run. All acknowledge the pressing need of many states and cities for federal funds; the only question is how to supply them. The Administration professes itself willing to find a compromise. Mills has proved artful in the past at discovering a way out of a political impasse. Nixon's revenue-sharing plan may be dead, but the demand for federal funds in one form or another is still very much alive.

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