And I hope that, as the years go ahead, these ties can become more important to both countries.

Senator STEVENSON. A group of American companies, I am told, plans to build 24 liquid natural gas tankers. They say they will not ask for subsidies on the construction of these tankers.

Some fear that later on there may be overruns, unexpected costs of one kind or another, and that then they will seek such a subsidy.

If there is such an arrangement, would you, as Secretary, give us some assurance that you will scrutinize it carefully against this risk, with a view to at least minimizing the risk of such a future request to the Congress for subsidy?

Mr. DENT. If these ships are started on a private basis, they should be completed on a private basis, and generally speaking, American business, which is operating under its own aegis, should continue that way, in my opinion, as a generalization.

Senator STEVENSON. Now the subject of regional development and the Economic Development Agency has been raised. I don't intend to ask you another question about it. I would support a request which has already been made.

You indicated, if I understood you correctly, that teamwork, dedication, banding together, could be a substitute for regional development, for Government assistance, in this case through EDA.

In the course of your reexamination of EDA, I would request that you consider this proposition, that the purpose of EDA is teamwork and dedication and banding together, and in the course of that reexamination that you consider specifically the case of southern Illinois. You may be familiar with Cairo-the poverty, the violence, the racial violence which has wracked that community for a long time. That violence has stopped. The shotguns have been laid aside, and the main reason is EDA, and teamwork and dedication and banding together. None of which would have come about without assistance from EDA.

Mr. DENT. Senator, on that, I believe you made the statement that I said instead of regional, this other.

Senator STEVENSON. A substitute.

Mr. DENT. My point was that in addition to regional development programs, whole communities can on their own make a significant contribution. I don't mean to eliminate regional. I just meant that the private sector in a community has within its power the capacity to move that community ahead, and perhaps this is also done within the context of a regional area. I just would like to correct that record.

Senator STEVENSON. My suggestion is simply that the capacity of that locality can depend upon government assistance. In the case I cite, with which I am most familiar, and in my own State, it has depended, does depend, will continue to depend upon the assistance of EDA.

A final question. The subject of oil imports was brought up. The whole subject of the fuel shortage in the country is a major concern and will be for a long time to come.

It's a major concern right now in the Midwest. For several months, I, and I know that many other Members of Congress have been attempting to persuade this administration-the President, the Department of Interior-to lift the quotas on the import of fuel oil, particularly importation of oil from Canada.

Since November, I have explicitly predicted suffering in the Midwest, pleaded for months for action. All of the Midwest Democratic Senators have banded together to plead with this administration for relief, for help.

Schools are closing, hospitals are short of fuel, factories are short of fuel. In Rockford, Ill., alone, 6,000 homes are about to run out of fuel-no heat. And the temperatures are hovering below the zero mark.

Can you help? Will you help?

Mr. DENT. Of course, I am interested in the subject. When confirmed, I will certainly do all I can to look into this matter.

And the American public and the American business interests certainly can't afford to run out of energy in this day and age. We depend upon it.

Senator STEVENSON. We have people right now who depend upon it. I would hope that you might try to do something right now, even before confirmation. I ask that because I am desperate. I have been trying for months, and I recognize that Congress doesn't have the principal jurisdiction, at least in the case of the oil import quota system.

But we have tried the Interior Department, we have tried the President. We have been trying for months, and we get no relief.

Mr. DENT. The whole energy field is one that is going to hit this Nation squarely between the eyes. In your State it is in winter, but in many States it is going to hit in the summer with the shortage of electricity as we air-condition.

And the country as a whole must face up to this energy situation. Electricity-they used to be able to build a public utility plant for production of electricity with a leadtime of 6 years. I am told that now it is 13 years, as they have to go through all of the routines to have this done.

And we as a Nation must face up to the problems that are attendant to this whole energy crisis.

Senator STEVENSON. Thank you.

Senator HART. There is an urgency at the moment about the fuel oil and the information we have suggests that the Lake Head pipeline can carry an additional hundred thousand barrels a day to the northern territories, right now.

But the longer term interest in the elimination of the oil import quota, per se, is one that I am usre Senator Stevenson and others would urge you to consider.

I had hearings 6 years ago 5 years ago on the oil import quota system, and I won't urge you to read the record, but a fair summary of the conclusions was that the thing is nuts. And particularly does it outrage logic, when the premise is protection of our national defense and the husbanding of our resources, our oil, here, and the assurance against dependence on the politically unreliable Middle East, to conceive of Canada as something different than the continent in which she sits.

I urge you to solve Senator Stevenson's problem tomorrow, and the Nation's problem the day after tomorrow.

If there are no further questions, we would ask you to submit written responses to the questions which the Chairman and perhaps others will have, within 30 days. That suggests that your answers to those questions are not particularly relevant to the question of confirmation, but we will want the answers anyway.

And last, at the direction of Senator Magnuson, I announce that there will be an executive session of the committee Monday, in the afternoon.

We appreciate very much your testimony, and I think it is perfectly safe to predict that our reaction to it, without exception, has been favorable, and that I would anticipate confirmation will be recommended.

Mr. DENT. Thank you very much, Senator Hart.

Senator HART. We are adjourned.

(Whereupon, at 1:20 p.m., the hearing was adojurned.)

(The following information was subsequently received for the record :)

QUESTIONS OF THE COMMITTEE AND SECRETARY DENT'S ANSWERS THERETO

Question. Travel is the largest single item in world trade, and the United States is the largest single factor in travel. However, we suffered a serious travel deficit of approximately $2.88 billion in 1972. In view of these facts, could you please advise the Committee what priority you would give to the promotion of travel to and within the United States by foreign visitors and Americans?

Answer. Mr. Chairman, our most recent figures indicate that the deficit for FY 1972 was actually closer to $3 billion.

I feel that the promotion of travel to and within the United States by foreigners is a priority effort of this Department. Within our total balance of payments, the tourist deficit equalled the trade deficit in 1971. Under these circumstances, an improvement in the travel deficit is as important as an equivalent improvement in the trade deficit.

In addition, tourism is a service industry and all services are becoming more important to the United States as a foreign exchange earner. Every overseas traveler who comes to the United States is equal to an export worth $400, for that is the average amount spent here excluding transportation.

Question. Do you anticipate that the Department of Commerce will request increased authorizations and appropriations for the Travel Service to implement programs designed to narrow the current travel deficit? (Department last year requested only $12 million of $15 million authorized.)

Answer. The FY 1974 appropriation request for the United States Travel Service in the President's budget is $9 million. Legislation to authorize appropriations for the program beyond FY 1973 will be proposed to Congress but is still under discussion.

Question. What new programs is the Travel Service currently implementing or seriously considering for implementation at a future date?

Answer. In past years, the U.S. Travel Service covered 44 countries with brochures, trade visits and a general advertising effort to promote inbound foreign travel.

However, the agency has now undergone a reorganization designed to create an efficient sell-oriented organization. There is a new aggressive five-year integrated marketing plan and measurement system designed to substantially improve our international travel position over the next five years. Under the plan, the United States Travel Service will concentrate its efforts on the top eight tourist-generating countries. These countries-Canada, Mexico, Japan, the United Kingdom, West Germany, France, Australia, and Brazil-represent 90% of total visitor arrivals and 81% of total foreign exchange earned on the travel account.

Specifically, the U.S. Travel Service will concentrate on tour package development with individual tour operators. In addition, incentive business travel will be encouraged as well as convention travel. These efforts will be heavily concentrated in only 6 markets with a lower level of programming in 2 of the countries-Australia and Brazil.

Question. The estimated deficit for 1972 was $2.86 billion. Assuming that there are no drastic changes in economic conditions, political strife, or any other forms of disruption, do you believe that the travel gap will soon narrow substantially? Could you please provide the Committee with forecasts for the subsequent five years, with an explanation of the reasons underlying the estimates?

Answer. Since 1961 the average annual increase in the travel gap has been 8.2%. With the normal trend forecast, a travel deficit of $3.910 billion is forecast by 1977, or about a 7.7% increase per year

Details are set out in the table on the following page.

EFFECT OF ACCELERATED RATE OF FOREIGN TRAVEL TO THE UNITED STATES ON U.S. BALANCE OF PAYMENTS [In millions of dollars]

To help determine the performance goals for USTS and to calibrate the impact of planned efforts, two forecasts of foreign visitors to the U.S. were made. The results of these forecasts are shown in Tables I and II and are described below.

Normal Trend Rate Forecast.-This assumes no demonstrable USTS-impact on the level of foreign tourism and other travel to the U.S. Under these conditions, the number of visitor arrivals will increase from 13.8 million in 1971 to 19.6 million in 1977 with corresponding growth in visitor expenditures from $2,882 million to $5,440 million.

The specific assumptions of this forecast are:

1. Favorable economic, political, and social conditions will continue to exist in countries which are major markets for travel to the U.S.

2. No additional currency restrictions will be imposed and those presently existing in South American countries will be relaxed in 1974.

3. The present air fare structures will remain essentially unchanged.

4. The travel industry will continue to increase promotion efforts in line with recent historical trends and estimates.

Accelerated Rate Forecast. This second forecast reflects four significant changes in the above assumptions:

1. USTS will maintain its activities at the funding level in the President's 1974 Budget.

2. The U.S. travel industry will substantially increase its selling and promotion efforts in foreign markets.

3. Both the U.S. Government and private industry will provide substantial effective promotion for the U.S. American Revolution Bicentennial in 1976. 4. A decline in visitor arrivals will occur in 1977 (compared to 1976) similar to that experienced following the Canadian Expo '67.

Under these conditions, the following incremental growth will result: "Differential increase"1 in visitor arrivals will amount to 2 million persons in 1976 and 600,000 in 1977.

"Differential increase" in foreign exchange earnings will amount to $1,430 billion in 1976 and at least $760 million in 1977.

Impact of Accelerated Tourism.-Achievement of the accelerated foreign tourism rate will have the following impact between 1973 and 1977:

1 Difference between normal trend increase and accelerated rate increase.

The U.S. balance of payments position will improve by $3.607 billion over the rate expected under normal trend rate conditions.

The deficit in the travel portion of the U.S. balance of payments will be reduced at an average annual rate of $721 million.

TABLE 11.-FORECAST EXPENDITURES BY FOREIGN VISITORS IN THE UNITED STATES

The term differential means the yearly and/or cumulative difference between the normal growth trend and the accelerated growth trend.