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GOVERNMENT REORGANIZATION Storage

H E A R IN G BEFORE A SUBCOMMITTEE OF THE COMMITTEE ON GOVERNMENT OPERATIONS HOUSE OF REPRESENTATIVES NINETIETH CONGRESS SECOND SESSION

H .R . 1 5 6 8 8 TO EXTEND THE EXECUTIVE REORGANIZATION PROVISIONS OF TITLE 5, UNITED STATES CODE FOR AN ADDITIONAL FOUR YEARS

MARCH 13, 1968

Printed for the use of the Committee on Government Operations

U.S. GOVERNMENT PRINTING OFFICE 91-673 WASHINGTON : 1968 YRZ8WIW1 WM?. 2MHKR

COMMITTEE ON GOVERNMENT OPERATIONS W ILLIAM L. DAWSON, Illinois, Chairman CH E T H O LIFIELD, California FLO R EN CE P. D W YER, New Jersey JACK BROOKS, Texas OGDEN R. REID , New York L. H. FO UN TAIN , North Carolina F R A N K HORTON, New York PO RTER H AR D Y, Jr., Virginia DONALD RU M SFELD , Illinois JOHN A. B LA TN IK , Minnesota JOHN N. ER LE N B O R N , Illinois RO BERT E. JONES, Alabama JOHN W. W YD LE R , New York EDW ARD A. GAR M ATZ, Maryland C L A R E N C E J. BROW N, Jr., Ohio JOHN E. MOSS, California JA CK EDW ARDS, Alabama D AN TE B. FA SC E L L, Florida G U Y VAN DER JAGT, Michigan H EN R Y S. REUSS, Wisconsin JOHN T. M YER S, Indiana JOHN S. M ONAGAN, Connecticut F LE T C H E R THOMPSON, Georgia TO R B E R T II. M ACD ON ALD, Massachusetts W ILLIAM O. CO W GER, Kentucky J. EDW ARD ROUSH, Indiana M A R G A R E T M. H E CK LE R , Massachusetts W ILLIAM S. M OORHEAD, Pennsylvania G ILB E R T GUDE, Maryland CO RN ELIU S E. G ALLAGH ER, New Jersey PAU L N. M cCLO SKEY, Jr., California W ILLIAM J. R AN D ALL, Missouri BEN JAM IN S. ROSEN TH AL, New York JIM W RIGHT, Texas FERN AN D J. ST GERM AIN , Rhode Island C hristine R ay D avis, Staff Director James A. L anigan, General Counsel M iles Q. R omney, Associate General Counsel J. P. C arlson, Minority Counsel William H. C openhaver, Minority Professional Staff

E x e c u t iv e and L eg islat iv e R eo rganization S ubcom m ittee JOHN A. B LA TN IK , Minnesota, Chairman BENJAMIN S. ROSEN TH AL, New York JOHN N. E R LE N B O R N , Illinois CH E T H O LIFIELD , California C L A R E N C E J. BROWN, Jr., Ohio H E N R Y S. REUSS, Wisconsin JA CK EDW ARDS, Alabama

E lmer W. H enderson, Counsel V eronica B. Johnson, Clerk Janet A. H urtack, Clerk

EXTENDING AUTHORITY FOR EXECUTIVE REORGANIZATION

WEDNESDAY, MARCH 13, 1968

H ouse of R epr e se n t a t iv e s, E x ec u tiv e and L egisla tiv e R eorganization S ubcom m ittee of th e C om m ittee on G overnm ent O per a tio n s, Washington, D.C. The subcommittee met at 10 a.m., in room 2154, Rayburn Office Building, the Honorable John A. Blatnik (chairman of the subcom­ mittee) presiding. Present: Representatives John A. Blatnik, Chet Holifield, John N. Erlenborn, and Jack Edwards. Also present: Elmer W. Henderson, subcommittee counsel; and J. P. Carlson, minority counsel, Committee on Government Operations. Chairman B la tn ik . The Subcommittee on Executive and Legisla­ tive Reorganization of the House Committee on Government Opera­ tions will please come to order. We meet in public session and public hearing to consider H.R. 15688, submitted to Congress under the date of January 17, 1968, and referred to this committee and subcommittee. The purpose of this legislation is to extend the authority granted to the President in the Reorgani­ zation Act of 1949, now codified in title 5 of the United States Code, sections 901-913, to submit reorganization plans to the Congress. The last extension of this act was made upon our recommendation in 1965, approximately 4 years ago, and will expire this coming December 31, 1968. Two reorganization plans submitted by the President in this year are pending before the subcommittee. As members of this subcommittee are well familiar, under the Reorganization Act the President may submit reorganization plans to the Congress which will go into effect after 60 days unless either the House or the Senate vetoes the plan by a simple majority vote. The vote is taken on a resolution of disapproval. For the convenience of the Members, there has been placed in your folders: 1. A copy of the letter of the Director of the Bureau of the Budget to the Speaker of the House dated January 27, 1968; 2. A committee print entitled “Executive Reorganization” which contains the full text of the act; 3. A brief summary, prepared by the staff, of amendments and extensions made to the act since it became law in 1949; and notice since 1953 there were several extensions, most of them for 2 years, the last recent one was for a 4-year period; and 4. A table, prepared by the staff, showing actions taken on plans submitted by the President since 1961. (l) 2

Before we get to our witness, the Deputy Director of the Bureau of the Budget, I’d like to announce that we are very pleased to have with us this morning our very good jfriend and longtime friend, Mr. Harold Seidman, former Assistant Director of the Bureau of the Budget, who has just retired. I do not know how a young man has any business retiring in his young, energetic state. He is an extremely dedicated public servant. I have called them longtime unsung heroes who do the hard, grueling, grinding technical work in some of the most intricate parts of the recesses of the Government machinery. Mr. Seidman, for many years, has handled the reorganization activities in the Bureau of the Budget and has maintained a very close working relationship with this committee and subcommittee. We have always held him in very highest regard and I would like to take this opportunity in behalf of this subcommittee to welcome him here as a visitor and friend. I hope you will continue to visit us both collectively as a committee and also certainly as individual friends. We will continue to seek his counseling, guidance, and judgment. I want to thank him for his splendid record in cooperation with the contributions he has made in many, many important plans that have been submitted to this committee over the past several years. I wish him every best wish and certainly good health and content­ ment, entirely justified satisfaction for your many, many years yet to come. Mr. Holifield. Mr. H olifield. Mr. Chairman, I just wish to aline myself with the remarks which the chairman of the subcommittee just made. It’s been my pleasure for many, many years to work on reorganization plans with Mr. Seidman and his advice and his deep knowledge of governmental structures and processes have been of inestimable value to this committee in consideration of the many, many reorganization plans that we have considered, and I am sorry that he is leaving the Government service. I understand now he is going with Ford Foundation, I believe— isn’t it, Mr. Seidman? Mr. Seidman. Mr. Holifield, the Ford Foundation has given me a grant to write a book, so I am a beneficiary of the Ford Foundation. Mr. Holifield. I will correct the record and say that the Ford Foundation has given Mr. Seidman a grant in recognition of his many, many years of service to the Government and he is going to write a book, and I will look forward to receiving a complimentary copy of that book. Mr. Seidman. Absolutely. Mr. Holifield. If I do not get a complimentary copy I am going to buy it because I am sure there will be a lot of truth in it. Chairman Blatnik. You still have the right of taking the fifth amendment at this time. Mr. E dwards. Mr. Chairman, I just want to ask one question. Is the book going to tell the whole truth? Mr. Seidman. I take the fifth amendment. Mr. E dwards. I am sure that we, on this side, join with the chair­ man on his comments. Mr. Erlenborn. Mr. Chairman, I think, as Jack said, we certainly want to associate ourselves with the remarks of the gentleman from the other side of the House. Though it is obvious, from our youth, 3 we have not been associated with Mr. Seidman as long as the other gentleman, our contacts have been most enjoyable. It has been a pleasure working with you. You have always been an excellent witness before this committee. Mr. Seidman. Mr. Chairman, I would just like to express my own appreciation to the committee. I think it has been one of the most rewarding parts of my experience in Washington, working with this committee. I have always been impressed by the complete profession­ alism and the fairness and objectivity with which this committee has conducted its business and appreciate the help we have received from the very able staff of the committee, from Elmer Henderson, from Jim Lanigan and Mrs. Davis, Herb Roback, and others. This has been an association I have enjoyed and includes the Members from both sides of the aisle. One of the things that made me think I have been here too long is that I find I am working with the second generation. Mr. Brown isn’t here this morning, but I recall working with his father. I think all of you remember whenever he said to me, “I am just a country boy,” I ducked. (The bill, H.R. 15688, follows:)

[H.R. 15688, 90th Cong., second sess.] A BILL To extend the executive reorganization provisions of title 5, United States Code, for an additional four years Be it enacted by the Senate and House of Representatives of the United, States of America in Congress assembled, That section 905(b) of title 5, United States Code (which relates to the latest date on which reorganization plans may be transmitted to Congress), is amended by striking out “1968” and inserting in lieu thereof “ 1972”. Chairman Blatnik. Our witness this morning is Phillip S. Hughes, the Deputy Director of the Bureau of the Budget, who will testify on H.R. 15688, a bill to extend the executive reorganization pro­ visions of title 5, United States Code, for 4 years. Mr. Hughes, will you please take the witness chair. Mr. Hughes. I would appreciate it if we could wring one more pound of flesh out of Mr. Seidman, and Mr. Levi is also with me. I think both of these gentlemen are known to you. Before proceeding with my statement, I think certainly the easiest piece of testifying I have ever done is to lend my own enthusiastic support to the comments that have been made by you, Mr. Chairman, and the committee members, with regard to Harold. In addition to the specifics which you have mentioned, I think Harold is a gentleman and a scholar in the best sense of both of those terms, and he has labored long and hard with a wide range of people to keep them both informed and honest on the matters that this committee and other committees are concerned with on the Hill. And there is no way really to acknowledge or repay the obligation that those of us in Government have to him in these areas that are of interest to you.

STATEMENT OF PHILLIP S. HUGHES, DEPUTY DIRECTOR, BUREAU OF THE BUDGET Mr. Hughes. Mr. Chairman and members of the subcommittee, I appreciate the opportunity to appear before your subcommittee to testify in support of H.R. 15688, a bill to extend the executive re- 4 organization provisions of title 5, United States Code, for an additional 4 years. The bill deals with the President’s authority to transmit reorganiza­ tion plans to the Congress under the provisions originally enacted as the Reorganization Act of 1949 and reenacted in 1966 as chapter 9 of title 5 of the United States Code. Under current law, reorganization plans may take effect only if they are transmitted to the Congress before December 31, 1968. H.R. 15688 would extend that terminal date to December 31, 1972. The authority given the President under the reorganization statute is an important tool in carrying out his responsibilities for the effective and efficient management of the executive branch. Indeed, the re­ organization statute itself places upon the President a permanent responsibility “from time to time to examine the organization of all agencies” and to “determine what changes therein are necessary” to accomplish the purposes of the statute. Those purposes include promoting the better execution of the laws, reducing expenditures, increasing efficiency in Government operations, abolishing unnecessary agencies, and eliminating duplication of effort. However, without the authority to transmit reorganization plans to effect certain changes he deems necessary, the President is handicapped in fulfilling his duties. Authority to reorganize similar to that in the current statute has been granted to the President for most of the past 35 years. The need for the authority continues to be great. President Johnson has placed great emphasis on improving the management and operations of the executive branch. In his first budget message, he stated: I have been guided by the principle that spending by the Federal Government, in and of itself, is neither bad nor good. It can be bad when it involves overstaffing at Government agencies, or needless duplication of functions, or poor management, or public services which cost more than they are worth, or the intrusion of Govern­ ment into areas where it does not belong. It can be good when it is put to work efficiently in the interests of our national strength, economic progress, and human compassion. In his most recent budget message, he continued to stress that: To attain the full benefits of our new programs, it is essential that they be made workable at the point of impact. Effective and economical management is also essential to insure that each tax dollar buys a full dollar’s worth of essential services. In achieving his objectives, the President has made extensive use of his reorganization authority. To date, he has submitted 15 reorganiza­ tion plans to Congress. Included have been plans to reorganize the District of Columbia government, the Public Health Service, and the Bureau of Customs, to create the Environmental Science Services Administration, and to transfer the Community Relations Service to the Department of Justice and the Federal Water Pollution Control Administration to the Interior Department, as well as the plans now before the Congress dealing with the urban mass transportation and narcotics and dangerous drug programs. We believe the reorganization procedure has become a well-accepted and proven tool for helping to keep the executive branch well organized to meet its current needs and for attacking the problems of ineffec­ tiveness, inefficiency, or uneconomical operations of Government. It affords a useful, expeditious, and successful means by which pro­ posals for the reorganization of agencies and activities of the executive 5 branch of the Government may be accomplished. Under this pro­ cedure a reorganization plan providing for the reorganization of execu­ tive agencies or functions is transmitted to the Congress by the Presi­ dent and takes effect after 60 days of continuous session of Congress— as defined in law—unless either House of Congress passes a resolution of disapproval during the 60-day period. This procedure enables the President to initiate improvements in executive organization, and it reserves to the Congress effective powers of review and disapproval. The cooperative executive-legislative approach authorized in the reorganization statute was adopted after long experience had demon­ strated that improvements in organization were difficult to achieve when the sole way of correcting defects was to rely upon the passage of specific legislation. Improvements were long delayed and often overdue when a reorganization contained in a bill had to pursue its course through the legislative machinery aud compete for attention with urgent substantive legislation. The reorganization statute per­ mits an alternative, or supplemental, way of approaching this problem. It places the responsibility for initiating improvements upon the President and provides ample opportunity for all who wish to be heard for or against any particular proposed change. Presidential initiation of organizational improvements subject to congressional review was first authorized by the Economy Act of 1932. Under that act, the President could provide for certain reorgani­ zations of executive agencies by Executive orders which had to lie before the Congress for 60 days subject to disapproval by a simple majority of either House of the Congress. In the Economy Act of 1933 changes were made to strengthen the procedure. It provided that Presidential orders making reorganiza­ tions would automatically take effect after lying before Congress for 60 days. The Congress could prevent such an order from taking effect only by enacting specific legislation. The reorganization pro­ visions of the Economy Act of 1933 remained in effect until March 19, 1935, during which time numerous important reorganizations took effect and none was disapproved. The Reorganization Act of 1939 authorized reorganization plans as we know them today. The plans were transmitted to the Congress and became effective after 60 days unless disapproved by a concurrent resolution passed by both Houses of Congress. A number of different arrangements were in effect during World War II, but after the war, Congress enacted the Reorganization Act of 1945 which was closely patterned after the 1939 act. Both the 1939 and 1945 acts provided numerous exemption of agencies and functions, thus preventing the application of the reorganization procedures to all parts of the executive branch. The Reorganization Act of 1949 corrected the situation and con­ tained no such exemptions or limitations. The 1949 act also provided for congressional disapproval of a plan by the adoption of a resolution by a majority of the authorized membership of either House of the Congress. This was the so-called one-House, constitutional-majority disapproval arrangement. When the President’s authority to transmit reorganization plans under the act was extended in 1959, this provi­ sion was deleted. Since that time a simple majority of either House has been able to disapprove a reorganization plan. In 1964, Congress

91-973— 68------2 6 provided that no reorganization under the act shall have the effect of— “ * * * creating any new executive department, or abolishing or transferring an executive department or all the functions thereof, or consolidating any two or more executive departments or all the functions thereof; * * The period during which reorganization plans could be transmitted to the Congress tinder the Reorganization Act of 1949 was originally scheduled to expire March 31, 1953, but it has been extended six times and, as I mentioned earlier, now expires on December 31, 1968. Eighty-three reorganization plans have been transmitted to the Congress since the Reorganization Act of 1949 became law on June 20, 1949. Sixty-one have become effective, and two are pending before the Congress now. Taking the broadest view, since the first Reorganization Act of 1939 became law, virtually the entire structure of the executive branch has been reshaped by changes made under the cooperative Presidential-congressional approach embodied in the Reorganization Acts. Each agency in the Executive Office of the President has had its organization affected by actions under the Reorganization Acts. Every executive department has benefited from organizational ad­ justments made by reorganization plans; likewise, many of the major independent agencies have been reorganized. Viewed thus, the re­ organization plan is a vital instrument for keeping our governmental house in order. The President is responsible for the efficient management of the executive branch. As the tasks of Government become steadily more exacting, and as the range of Government activities becomes more complex in response to the needs of our times, the importance of sound organization and management assumes critical proportions. Economy, efficiency, and clear lines of executive responsibility are central to the faithful execution of the laws. The authority to transmit plans under the reorganization statute is an essential tool to aid the President in meeting his responsibilities. For these reasons, I recommend that the Congress enact H.R. 15688. Thank you, Mr. Chairman. I would be pleased to respond to ques­ tions the committee may have. Chairman Blatnik. Thank you, Mr. Hughes. Certainly no member of the committee and very likely—I believe I am correct—no Member of the House, has been as close to this whole m atter of reorganization of the executive branches as our colleague and our leader, Mr. Holifield, from California, who will recall coming to Congress 21 years ago this January. Mr. Holifield was a member of the Hoover Commission, if I recall correctly. In his leadership capacity, he served as the director or chief participant, initiator, or chairman of subcommittees that have worked on different aspects of reorganization. I would like to refresh our own memories and call this to the attention of some of the Members who came quite a bit later after that period. Mr. Holifield, we will turn over the questioning to you at this time, and any comments you have to make. Mr. H olifield. Thank you, Mr. Chairman. I can only compliment the deputy director, Mr. Hughes, for this very clear and pertinent statement which he has made. As far as I know, the analogy that he cites is perfect. There have been, as he has mentioned, a number of changes in the original Reorganization Act which originally required 7 the disapproval of both Houses of the Congress and that was changed to either House by constitutional vote of the House, and then later it was changed to a simple majority of either House, and then in the act of 1964, when there were rumors that two of the cabinet level departments were going to be joined together, we put certain language in there to prohibit that—to prohibit the abolishing or transferring an executive department or all the functions thereof, or consolidating any two or more executive departments or all the functions thereof. We have created two new executive departments under the regular route of legislative procedure. I am glad you brought to our attention the fact that 83 reorganiza­ tion plans have been sent here and 61 have become effective, and we are shortly going to have hearings on the plans pending before this committee. I believe that every President has found this authority beneficial to him and to his aides in improving the housekeeping function and making more efficient the structure of the agencies; and I am certainly in favor of giving any President, regardless of whether he be Democrat or Republican, the right to have the privilege of sending up something that he knows will have to have the consideration of Congress. And this is really the advantage that you do give to the executive branch of Government. The executive branch of Government can send up a draft of a bill and it is entirely up to the whim of the chairman of tlie committee in many instances, if he is a powerful chairman, as to whether the Members of the House will have a chance to vote on it or not. This goes so far as to make it—to give each Member of Congress the right to say that a proposal by any President, whether he be Democrat or Republican, will be acted upon by the Congress, because if during the period of lying before the committee and the Congress this reorganization plan is opposed by one Member of the Congress— and this is giving a tremendous amount of power to one Member of the Congress, far more than he has during the normal legislative process— he can bring this plan to the floor and have an opportunity to argue against it and to defeat it—and plans have been defeated. Sixty-one out of the S3 plans submitted to Congress have become effective, and the other 22 were defeated by the Congress. I think this play back and forth between the executive branch and the legislative branch, giving to the executive branch certain advantages which they don’t have ordinarily, and giving also to the individual Member of Congress certain advantages which he does not have under the regular committee process, was well-balanced and I am certainly in favor of extending this basic Reorganization Act and giving to any President, regardless of who he might be, the same power that we have given to Presidents in the past 35 years. I believe it is a time-tested and proven method of obtaining minor adjustments which require statutory change and cannot be done by executive order, and I am 100 percent in favor of it. I really have no questions because I think you have covered almost every point. Mr. Hughes. Thank you, Mr. Holifield. Chairman Blatnik. Mr. Erlenborn. Mr. E rlenborn. 1 would like to ask why a 4-year extention? In the past—over the long period of years, 2 years was customary. Three years ago, I believe, the bill that was sent up here from the White 8

House called for indefinite extension without termination. Congress worked its will—I guess in the House we said 4 years and in the Senate they cut it back to 3. Why now a 4-year statute rather than 2 or 6 or an indefinite time? Mr. H ughes. Well, I think, Mr. Erlenborn, there are no real magic numbers here. I think the virtue, if you will, of a 4-year ex­ tension would be th at it would be coincidental with the term of the new President, whoever he might be. Mr. E rlenborn. May I interrupt you there and say it would be something other than a virtue? Mr. H ughes. I would not regard it as such, Mr. Erlenborn. I certainly share Mr. Holifield’s view that the President, whoever he may be and whatever his party may be, needs the sort of authority which is provided in the Reorganization Act and the authority that is in it to submit reorganization plans. Mr. E rlenborn. As a m atter of fact, I agree with you. I am sympa­ thetic to the extension of the reorganization powers and, to show my complete fairness, I will say that regardless of which party the Pres­ ident may belong to—and I expect in the next 4 years it will be my party. However, I think it is valuable for us during the President’s term to review this authority in light of how the President has ex­ ercised it. I remember just a few short years ago the Congress did that. In light of the then President’s attempts to create new de­ partments and abolish departments of Governments, the Congress decided that they didn’t want the President to utilize reorganization powers to that extent and amended the act to prohibit the use of reorganization powers for that purpose. And as I say, even though I expect we will have a Republican in office in the next 4 years—I may or may not be correct on that assump­ tion—I think during his term we should have the opportunity to review how he has utilized those powers and possibly to amend the act. Mr. H ughes. Well, I guess, Mr. Erlenborn, this is a point on which we may have some difference. It seems to me that the Congress in effect is sitting all the time in judgment of the authority that it has extended under this act. It can as it has in the past, amend the act if it elects. The act itself, incidentally, is a permanent law. It is simply the authority to submit plans that has been limited in the past. My feeling is that the Congress first of all has its general and obvious statutory authority and responsibility. Secondly, it sits in judgment on each plan as the President submits it and, whatever the term for which the President is authorized to submit plans, it can take those or leave them one at a time or amend the basic statute if it elects to do that. It seems to me this is an adequate control, if you will, an adequate grip by the Congress on the process. Air. E rlenborn. Let us pick up your plirase at “Congress” and take these one at a time. It raises another question—and 1 will have to go back in history a little bit because I do not think that in recent history that has been a particular problem. There have been times— and I am looking at the information which is in our folder here—back in—what was the year?—1961, we had pending at the same time some five or six plans. At the present time in test we have two plans pending. I do not think it would be necessarily burdensome to handle the present ones at the same time within the same time frame; hut if we had five or six it would be a little bit difficult. In your opinion, 9 is there some way, within this act, for ns to establish some sort of scheduling of these plans so we do not have five or six or eight pending at the same time? Mr. Hughes. It seems to me, Mr. Erlenborn, that this is a matter which, generally speaking, and with due regard for the complexity or simplicity as the case may be, and its controversiality and so on, can best be worked out in terms of consultation and suitable timing arrangements between the executive and the legislative and on the legislative side obviously this committee. We have tried to maintain close contact with the committee and its staff and to schedule the submission of the plans on a basis which permitted the committee to give full and adequate and deliberate consideration to the plans and, as I think you suggested, we have not done too badly lately anyway, and we would certainly endeavor to continue to conform to the committee’s own scheduling, recognizing the demands on the chairman and your members. Mr. H olifield. Would the gentleman yield? Mr. E rlenborn. Yes. Mr. H olifield. I want to also approve this thought which Mr. Erlenborn has expressed. We do not want plans sent up here in a bunch, like a bunch of bananas, because the time limit runs the same on all of them in that case and it might give the committee an awkward time because, to some extent, we are—Members of the House can file disapproval resolutions. We do not have to have hearings on these plans under the law if a Member does not file a disapproval resolution. It would become law automatically. But I long ago took the initiative in requesting this committee to have hearings on every plan that comes up regardless of whether a disapproval resolution was filed or not, be­ cause I felt the committee being charged with this responsibility owed it to the Congress as a whole to have hearings and to print some­ thing which each Member could obtain before the period passed in which he could file a disapproval resolution, and we are proceeding on that. And I have had a “gentlemen’s agreement,” let’s say, with the Bud­ get Bureau on this matter of sending up a bunch of plans at a time, and have also taken the initiative, as the gentleman knows, in asking that consultation be had with the committee, in order that we might have the plans at a time when we were not burdened with excessive— with the normal type of legislation. So I agree with the witness that this can be worked out; and I think it now has become almost a pro­ cedure which has been found to be beneficial by both the Budget Bureau and myself. I agree with the gentleman on his thoughts. Mr. Erlenborn. Just one or two other things. Chairman Blatnik. Would the gentleman yield? Mr. E rlenborn. Yes. Chairman Blatnik. You referred to a good question as to why so many plans—I believe up to five perhaps—were submitted within a period of two and a half months in 1961. Those all dealt with agencies such as Securities Exchange Commission, Federal Communications Commission, Federal Aeronautics Board, Federal Trade Commission, National Labor Relations Board, Home Loan Bank Board, and some Maritime Administration functions. Would you recall, Mr. Hughes, or Mr. Seidman, why so many were submitted in such a short period of time, almost 1 week? 10

Mr. Seidman. As I recall, these plans were not developed in the Bureau of Budget. These were a series of plans developed by Mr. James Landis who was then a consultant to President Kennedy. They were all identical plans except they referred to different regula­ tory commissions. They all provided for—the provisions were identical in each one of them but these were not plans that were handled in the normal sense by the Bureau because they were prepared by Mr. Landis—but they were identical type plans. The provisions were the same. There were five. The ones that year that had been handled by the Bureau of Budget were the ones on the Home Loan Bank Board and the Maritime Commission, but the five related to the regulatory commissions had been developed by Mr. Landis. Chairman Blatnik. Three of them were vetoed. When you say they were not handled by the Bureau of Budget, that makes it a little more complicated. That means even though we have a good line of communication as to scheduling of plans with the Bureau of Budget, it is very likely to appoint these special counsels, in the case of Mr. Landis, and come up with a whole flock of reorganization plans without any consideration as to the wishes or the working schedule and workload of the committee. Would that not be correct? Mr. Seidman. This, I think, could happen. This, as you know, was in the first year—first months—of the new administration. Mr. Hughes. I think, Mr. Chairman, we have an obvious stake in the smooth working of this procedure. I recall with some pain the experience, because we were aware of the problems both for us and for the committee. I think the chances of a repetition of the situation are very small, and I can assure you that as far as we are concerned we would do all that we could to conform the schedule of the plans, no matter where they were originated, to the needs of the President and to the needs of this subcommittee and committee. Chairman Blatnik. Thank you, Mr. Erlenborn. Mr. E rlenborn. I am glad Mr. Seidman called our attention to the fact that the five plans were not handled by the Bureau of Budget because that does improve your batting average. Mr. Holifield. This was, as I recall it, Mr. Hughes and Mr. Seidman—this had to do with making strong chairmen and giving them the authority to appoint subcommittees within the commissions, was it not? Mr. Seidman. This dealt more with the latter. Questions were raised by the legislative committee because the plans dealt primarily with the delegation of certain functions to boards and hearing boards and sub­ units within the commissions. Most of these agencies already had strong chairmen, that had been done by some of the earlier reorganiza­ tion plans. This dealt with the delegation of functions and questions were raised as to whether this raised substantive issues which went beyond the transfer or delegation of functions within the commissions. Mr. E rlenborn. There are just two other things that have bothered me somewhat over the few short years that I have been connected with these reorganization plans. One is the apparent form of message that is used in the Bureau of Bptlgqt. We have two plans, for instance, pending now, and 1 am read- 11

ing from the messages of transmittal. First on plan No. 1, on page 2 of the message, it says: I found after investigation that each reorganization included in the plan was necessary to accomplish one or more of the purposes set forth in section 901(a) of title 5 of the United States Code. Then on plan No. 2, page 3, we find-—I think it is identical wording— I have found after investigation that each reorganization included in the re­ organization plan transmitted herewith is necessary to accomplish one or more of the purposes set forth in section 901(a) of title 5 of the United States Code. I think if you go back over the last several years, you will find that exact paragraph of the same wording, or certainly similar wording, in every message. I am considering offering an amendment to this bill that would require that the President’s message of transmittal identify which of the purposes, rather than just this broad blanket statement that seems to be part of the form message. Would this be impractical in your opinion? Mr. H ughes. We think, Mr. Erlenborn, the appropriate place to attem pt to spell out, insofar as this can be done and sometimes it is very difficult—but the appropriate place to spell out the particular objectives of the plan and the relationship of its objectives to the purposes of the act is in the reports and testimony on the plan itself, rather than in the President’s own message. I realize preferences could differ on this point and we, of course, are aware of your past interest in this matter. The act itself I think is quite specific in that it does stipulate that the findings shall be a general finding, at least as we read it, and I think we read it correctly. We also, because of your interest in this in the past, did a little bit of researching of the legislative history of the 1939 act which was the initial act in the present form, and we have a record reference from the House report at that time—I do not know its origin—I do not know how it got in the report, whether it was stimulated by the executive or by the committees. The history is considerably in the past, but it is quite specific on this point, and I think it would be of interest, and I am quoting from House Report No. 120 on H.R. 4425, March 3, 1939, page 4: The President * * * is also required to accompany the plan by a declaration that, with respect to each transfer, consolidation, or abolition specified in the plan, he has found it necessary to accomplish one or more of the five purposes specified in section 1(a). It is to be noted that he is not required to specify in connection with each transfer, et cetera, which one or more of such purposes he has found. And it goes on to say: To so require would be too burdensome. T hat’s the end of the quote. We can furnish that for the record, if you like. Mr. E rlenborn. I would appreciate it, if you would. M ay I ask unanimous consent that that be placed in the record at this time? Chairman B latnik. N o objection. It is so ordered. (The document referred to follows:)

Excerpt From House Report No. 120 on H.R. 4425 (Re Reorganization Act of 1939) The President * * * is also required to accompany the plan by a declaration that, with respect to each transfer, consolidation, or abolition specified in the 12 plan, he has found it necessary to accomplish one or more of the five purposes specified in section 1(a). It is to be noted that he is not required to specify in connection with each transfer, et cetera, which one or more of such purposes he has found. To so require would be too burdensome. Mr. H ughes. T o return to the question you raised, Mr. Erlenborn, our preference would be to have the act as it is with the prospect that we confront you at hearing time, if not before, with respect to why we proposed what we proposed and at that time attempt to deal with the relationship between the plan and the specific purposes of the act. Mr. E dwards. Would the gentleman yield? Mr. E rlenborn. Yes; I yield. Mr. E dwards. D o I understand that the fact that there is a hearing is more in the nature of the “gentlemen’s agreement,” as Mr. Holi- field put it a moment ago, rather than some requirement of the law unless there is a disapproval resolution? So let’s assume, God forbid, Mr. Holifield or our present chairman or some of these folks may not be here in the future and there is no “gentlemen’s agreement” that there will be a hearing on these reorganization plans; then, in effect, we are left without any real knowledge other than just this very broad statement. Mr. H ughes. It seems to me, M r . Edwards, that first of all, whether there is or is not a hearing is completely within the commit­ tee’s grasp, not ours. The second point would be that whether or not there is a hearing the committee is free to seek from the Bureau or from other affected parties or from whomever it may wish, whatever information it wishes about the plan of a written nature if there is not a hearing, and it seems to me that this does provide a set of machinery to accomplish the purposes. Mr. H olifield. Would the gentleman yield? Mr. E dwards. Just one moment and then I will. I just want to make this one comment. What you say is fine but that is of no real use if the prevailing majority, whichever side it might be, chooses not to have a hearing, then you have got a minority who is crying for the answers but not able to get them, and it just seems to me it would be easier and more simple to put this right in the proposal. Mr. H ughes. I think the question, Mr. Edwards, is not whether this information should be forthcoming. I think it should be, assuming that the committee wishes it. I think the question is whether the President in his statement with regard to the plan should be required to go into this degree of specificity and burden what otherwise, it seems to me, should be a rather general message without this type of rather detailed and specific information which may well raise more questions than it answers. Mr. H olifield. I would like to respond to the gentleman’s sug­ gestion. While it is true that there has been this policy adopted as a “gentlemen’s agreement” among the members of the committee, let me say that any member of the committee holds within his privilege of compulsory hearings. All he has to do is file liis resolution of dis­ approval and then the committee must hold hearings or they forfeit the right of the time of consideration on the floor, because the indi­ vidual that files the disapproval resolution, if the committee does not hold a hearing and if a resolution is not reported out by the committee 13 either in favor of the resolution of disapproval or in opposition of it, that Member controls the time on the floor. So any committee, re­ gardless of which party was in power, that was jealous of its juris­ diction and of its control at the time of debate would automatically have the hearing. So it really is not a matter that could be taken away from the committee. Any member of the committee can file this resolution as a rule, and that automatically produces the hearing. Is that clear? Mr. Edwards. Yes. Mr. Holifield. I think this is one of the good things about this reorganization plan procedure. I think we have all known of instances where chairmen and even Majority Members of the committee have exercised power to prevent the consideration of a legislative proposal, and that is impossible under this. And I think this is one of the re­ deeming features of it, that while it does give the executive branch the initiative in drafting a proposed change, it is within each Member of Congress in the House of Representatives a power which he does not have under any other legislative process which is the power to demand a hearing and the power to have consideration of the bill on the floor. This is a very unusual----- Chairman Beatnik. Highly privileged. Mr. Holifield. It is the same as high privilege on the point of personal character business almost. It goes that far. Mr. Erlenborn. Of course, there is a good reason for this, in that we are reversing the legislative process through the reorganization procedure. If the resolution of disapproval did not have this type of privilege, in effect we would be denying Congress the opportunity to exercise its veto power. One last point I would like to make is that it seems to be part of the form message of transmittal, not necessarily always in exactly the same words, but similar wording, to say that it is not feasible at this time to itemize the economies that can be realized by this plan. In the first place, 1 do not think it is regarded under the law that every plan accomplish economies. It has to be one or more of the purposes in section 901(a). Maybe there is no economy. Maybe the reorganiza­ tion plan may actually provide for additional personnel, greater responsibilities, more expenditure—no real economy; but, if there is an economy, I think that some attempt should be made to identify it. Again, though, 1 think the Bureau of the Budget has fallen into the easy way of following the old form and in every plan they say it is not feasible—or practical—at this time to identify the economies. Mr. Hughes. Sometimes there are virtues in old forms. I do not necessarily argue that ours is perfect in this regard. Again, we are trying to take cognizance of the language of the act. Mr. E rlenborn. I might just say that it would be refreshing sometimes if your message would say there are no economies involved in this. Mr. Hughes. It might be refreshing but it might also be disastrous. Mr. Holifield. Well, one of the requirements is that it becomes more efficient. It does not have to be more economical. Sometimes you can do a better job with 10 men than you can do with five, and it is the efficiency. The efficiencies might require more expenditures. In other words, it is not obligatory that there be a reduction in expenses. 14

Mr. H ughes. That is correct, Mr. Holifield. The language, though, of the act, and I am reading 903(b), the second sentence: In his message transmitting a reorganization plan, the President shall specify with respect to each abolition of a function included in the plan the statutory authority for the exercise of the function and the reduction of expenditures (itemized so far as practicable) that it is probable will be brought about by the taking effect of the reorganizations included in the plan. Mr. E rlenborn. D o you really think that your transmittal messages conform with this requirement? Mr. H ughes. The message takes cognizance of this language and in effect says that the itemization is not practicable. Mr. E rlenborn. So you are taking the statutory requirement that you itemize and obviating it in every message by saying you cannot do it? Mr. H ughes. No; I am taking the statutory language which says, “this reduction of expenditures”—and I am still quoting—“itemized so far as practicable.” Mr. E rlenborn. When was the last time you found it practicable? Mr. H ughes. In the District of Columbia plan we submitted in the testimony------Mr. E rlenborn. We are talking about the requirement in the message. Mr. H ughes. The message itself, I do not know. Mr. Seidman. Yes, we have. We have not brought them. We had a small one listed when we had the Zoological Park plan of $2,000. We did it on—certainly on the customs reorganization plan. We had quite a fairly large amount which was realized. We did have a specific amount listed in the message, as I recall, on the one that dealt with the transfers of functions on locomotive inspection within the Inter­ state Commerce Commission. So, wherever it has been possible really to come up with an honest figure this is what we w ant. Where we could identify where there would be a reduction in personnel which we could point to we have included this in the message but wrhere it has been speculative and you can only judge that it is going to be increased efficiency, which you cannot really measure a precise amount, we have not. Mr. H ughes. Mr. Levi brings to my attention that Reorganization Plan No. 5 of 1966, Mr. Erlenborn, had a specification of savings in it. I think Mr. Seidman’s statement sort of covers the situation. Where we have something w e can point to that is precise, we do it. Otherwise, we take cognizance of the requirement and say we cannot. Mr. E rlenborn. Thank you, Mr. Chairman. Chairman B latnik. Mr. Edwards? Mr. E dwards. Thank you, Mr. Chairman. You were reading a moment ago from title 5, section 903(b)? Mr. H ughes. Yes. Mr. E dwards. I would like to go through that a little more thor­ oughly with you and read: The President shall have a reorganization plan delivered to both Houses on the same day and to each House while it is in session. In his message transmitting a reorganization plan, the President shall specify with respect to each abolition of a function included in the plan the statutory authority for the exercise of the function and the reduction of expenditures (itemized so far as practicable) that it is probable will be brought about by the taking effect of the reorganizations included in the plan. 15 The part in parentheses, "so far as practicable”, refers to expendi­ tures or reduction of expenditures. It does not suggest that you should not state in the message what the reduction of expenditures would be. It simply says you should itemize those reductions where it is prac­ ticable. I see from the reading of that that where it may not be practicable to itemize reduction in expenditures it, nevertheless, is incumbent upon the President in his message to state what that reduction will be in total. Am I correct in my interpretation of that? Mr. Hughes. I guess, Air. Edwards, we disagree on what the significance of the itemization "so far as practicable” is. Conceivably, I suppose we could arrive at a total reduction in expenditures without knowing what the components of it were, but it seems to me that would be very difficult. If we have a million dollar reduction that is firm, that we can identify and specify, it seems to me in arriving at that we need to know the components. Mr. Edwards. Yet, if you do not state that million-dollar figure, are you complying with the law? Mr. Hughes. I think so. I think so. Where we have a million- dollar figure which we are sure of, we do state the figure, whatever it may be, and the source of that figure. If we do not have a firm re­ duction figure, if the plan, in effect, is proposed not necessarily be­ cause of the actual expenditure reductions that it will achieve but to achieve some of the other purposes of the act, then we have so specified. Mr. Edwards. Mr. Chairman, I just got this message that they are ready for me to testify. I would like just to make a couple of comments before I leave. Partially, I think the reorganization provisions of the law are meritorious. I think the executive branch ought to, within reason, be in a position to reorganize itself and again I say, within reason. At the same time, this is a transfer of the powers of Congress, so to speak, to the executive in this limited situation and, therefore, in my opinion, should be strictly construed when these messages come back to us because, as I see it, these are powers of Congress that for convenience we have given to the President. So I would join Mr. Erlenborn in the argument that we are not being given enough information in the message and it is my recol­ lection that most of the argument that has taken place in these hearings on reorganization plans has gone to the lack of information rather than to the substance of the proposed change. And my impres­ sion is that if we were given the information in the message, that Mr. Erlenborn and I are talking about as we construe the statute, that there would be a lot less argument in opposition to a reorganization plan. Some of us, for whatever reasons, stand on technicalities, perhaps too often, but if this were cleared up in the message, it would be my impression that many of these reorganization plans would go through a lot easier. Mr. Chairman, I have got to run. Mr. Holifield. I am sorry the gentleman is leaving and I would not want him to remain, but as he walks out I would like for him to listen to a nonlawyer comment on the fact that it seems to me section 901 sets forth six different provisions where the President shall find, and section 903 particularly refers back to 901(a) and puts upon the 16 President the responsibility for finding that, “It is necessary to ac­ complish one or more of the purposes of section 901(a).” Therefore, ostensibly, if the President should find that the purpose of 901(a)(1) promotes better discussion of the laws and functions and expeditious administration of public business; if that one or any other one of the six was found to be advantageous by the President, it is expected that he would comply with the law. No. 2, 901(a), “to reduce expenditures” is controlled, I think, over by 903(b). There it is referring to reduction of expenditures and there it says that if that is one of the purposes the President finds that so far as practicable he shall set them forth. However, many of the plans, as I have said, do not necessarily hinge upon the purpose set forth in 901(a)(2), and therefore a plan could be just as valid without a reduction of expenditures. Mr. E rlenborn. Would the gentleman yield? Mr. Holifield. Yes. Mr. Erlenborn. I agree with you completely. My only difficulty with this is if the President continues to submit plans without identi­ fying which of the purposes in 901(a), is being accomplished, then he is never brought under the requirement of 903(b), because he has never identified one of the purposes as being a reduction of expendi­ tures. He merely says it is one or more. This makes 903(b) meaning­ less, because he never has to itemize reduction of expenditures if he has not identified this as one of the purposes of the plan. That is why I think the practice being followed by the Bureau of Budget is defeat­ ing one of the express purposes of the law. Mr. Hughes. T wo points, Mr. Erlenborn. Whether or not the President specifies which of the purposes of 901(a) is carried out by the plan, 903(b) is in effect, it seems to me. We have attempted to take cognizance of that by specifying in those instances where we had an identifiable reduction in expenditures. It seems to me the matter under discussion here is really the question of what should be in the President’s message versus what should be in some other form, pre­ sumably testimony, reports, what have you. I think there is no ques­ tion in our mind but what the committee and the Congress are entitled to this kind of information. We are reluctant for reasons that I think are obvious, to tie the President, in effect, to a specified choice among the purposes of the act and to nail him as an individual to a particular expenditure reduction unless it is very clear and identifiable. We certainly recognize the Congress need to know these kinds of things and recognize our responsibility to identify expenditures wherever we can, whether or not the President’s message does that. Mr. Holifield. I might say, I would not be adverse at all to the President setting forth some more detail than he has in some of his messages. However, and I have before me now, for instance, the Reorganization Plan No. 1, creating a new Bureau of Narcotics and Dangerous Drugs. Over at the bottom of page 2, the President says: I have found, after investigation, that each reorganization included in the plan is necessary to accomplish one or more of the purposes set forth in section 901(a) of title 5 of the United States Code. which you were just referring to a minute ago. Then he goes on down and he says: Should the reorganization I propose take effect, it would make possible more efficient administration of Federal law enforcement and functions. 17

In my opinion, 901(a)(3), to increase the efficiency of the operations of the Government to the extent practicable, that is in accord with that. Then he goes on and he refers to the section 903(b) and takes recog­ nition of that fact when he says, “It is not practicable at this time, however, to itemize the reduction in expenditures which may result.” So it would seem to me that he has complied with the law. Maybe he has not complied with it in the detail that my colleague would like to have it done, but certainly, technically it seems that he has complied at least on those two points and there may be other places in there that he has not, He speaks of sovereignty of authority, and so forth, which may come under the heading of another section there. It would consolidate agencies and functions of the Government according to said purposes. In 901(a)(4), certainly, that is in accord with that. Mr. Hughes. Mr. Chairman and Mr. Holifield, I think the dilemma here, at least to an extent, is that the Presidential message is not only a legal document in terms of the requirements of the act, but it is also a public document as Presidential statements are bound to be, and we and the President are torn between these somewhat conflicting objectives. A document which is in legal terms and meets the require­ ments of the law, compromises somewhat the public statement and na­ ture of the President’s message and we have tried in developing drafts of messages and working on them to satisfactorily resolve these some­ what divergent purposes. We will attempt, mindful of this discussion, to be as specific as we can. Mr. Holifield. I think it would be helpful if you would consider making it a little bit more definitive. Chairman Blatnik. Any other questions or comments? (No response.) Chairman Blatnik. No further witnesses. Thank you very much, Mr. Hughes. Thank you, Mr. Seidman. Mr. Hughes. Thank you, Mr. Chairman, and I appreciate the opportunity to be here. (Whereupon the hearing adjourned at 11:15 a.m.) U