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as it is at present. There is general agreement that the whole oldage insurance system needs to be overhauled. Surely, until that job is completed, it would be unwise to elevate FSA to Cabinet status. 4. Criticism of Reorganization Plan 27: If this plan were proposed on a purely objective basis, it would not include section 8 which is designed to elevate the present FSA hierarchy. There has been much criticism of these officials and of the total administration. Until last year, the post of Assistant Administrator was held by J. Donald Kingsley, a Communist collaborator who had been denounced as such on the House floor.

Senator HUMPHREY. Mr. Chairman, I take exception to the remarks made about Mr. Kingsley. I think there was absolutely no proof of this. There were all kinds of allegations made on the House and Senate floor. I want the record to show that this man has been thoroughly investigated and as far as his loyalty is concerned it is unquestioned.

Dr. SHEARON. Mr. Chairman, may I give for the use of the committee this statement?

(Speech of Hon. Frank B. Keefe on June 2, 1949, titled "Are We Headed Toward a Socialist Economy?")

The CHAIRMAN. We are not investigating Communists. want to call him a Communist that is your privilege.

If you

Dr. SHEARON. I am not calling him a Communist but a Communist collaborator.

The CHAIRMAN. If you want to say that on your own that is your privilege.

Dr. SHEARON. It was said on the House floor and I wish to give you the statement.

The CHAIRMAN. Many things are said in the House and Senate Chambers.

Dr. SHEARON. It was well authenticated.

The CHAIRMAN. Let us get down to the facts. If you want to take the responsibility for your statement you may do so.

Dr. SHEARON. I do. Of course it becomes important, does it not, if we have on the staff of an agency persons who are Communist collaborators?

The CHAIRMAN. It may become important but the jurisdiction of this committee and the object of these hearings is not to investigate Communists or alleged Communists. The purpose of this committee is to determine whether this plan is feasible and advisable and whether we ought to permit it to become law. What some individuals may do is not pertinent. I hope you will proceed with your statement, and as to whether Mr. Kingsley is a Communist or Communist collaborator each individual member of the committee and Members of the Congress can make such inquiries as they desire.

Dr. SHEARON. I give it as an illustration of maladministration; that there was such a man in high position in the Federal Security Agency who has since slipped from the country and is now Director General of the International Refugee Organization.

The CHAIRMAN. Will you continue with your statement, please? Dr. SHEARON. May I have this printed?

The CHAIRMAN. It may be filed.

(The information was filed for the use of the committee.)

* *

Dr. SHEARON. I call attention to the fact that the new Secretary would be authorized to delegate "any function of the Secretary" to "any other officer agency, or employee." Section 2 (c). Thus it would be entirely possible for the Secretary to parcel out the contacts for health, education, and security among the Under Secretary, Assistant Secretary, and Administrative Assistant Secretary. At the present time the Surgeon General is a commissioned officer and is always a physician.

I might explain for the committee that it has been the custom to appoint a physician because of his broad experience in the field of health. He generally works up either through a State health agency as Dr. Parran did and then up through the Public Health Service and gets very broad experience in the field, much broader experience than a sanitary engineer or dentist. That has been the custom up to date. This would not be mandatory under the plan. It would be entirely possible at some future time to place a lay administrator in charge of health functions. There is every justification for believing that part of the purpose of this plan is to pave the way for the nationalization of medicine.

It has been contended that this plan adds no new substantive powers to the authority of the FSA Administrator. I think it does by indirection. The power and prestige that go with a Cabinet post in themselves expand the authority of the incumbent of that post. Having the ear of the President and sitting in on top policy conferences make it possible to influence those policies as they affect proposed legislation and program development. The present Administrator has made himself the spokesman in the fields of health and education where formerly we heard from experts in those fields. Would he be less a spokesman if he were in the Cabinet?

I believe the proposed elevation would go a long way toward Federal control of education and of health functions. Is there not the greatest danger of centralization of power in these fields if departmental status is accorded? There is general agreement that health and education functions are, in the main, State and local functions. The grant-in-aid programs, which now absorb most of the money spent by the Social Security Administration, are locally administered. Only the old-age and survivors insurance program is presently administered by the Federal Government. If this should be reorganized so that it is on a more automatic basis, with elimination of most of the Federal personnel, then the major portion of health, education, and welfare functions at the Federal level would be secondary. Primary administrative responsibility would rest in the States where it belongs. The FSA shadow, which looks to many people like the dark cloud of State socialism, would be dispelled.

I urge, therefore, that this committee reject plan No. 27 and vote in favor of Senate Resolution 302.

The CHAIRMAN. Thank you very much, Dr. Shearon.

Any questions, Senator Humphrey?

Senator HUMPHREY. No questions.
The CHAIRMAN. Senator Smith?
Senator SMITH. No questions.
The CHAIRMAN. Senator Mundt?
Senator MUNDT. No questions.

The CHAIRMAN. Senator Schoeppel?

Senator SCHOEPPEL. No questions.

The CHAIRMAN. Is there anyone else who has come prepared to testify or anyone else who wishes to make a statement on the reogranzation plan?

If not, the open hearings will come to a close.

Those statements that have been submitted in response to invitation by the committee may all be inserted in the record. If any statements come in that have been requested by the committee where invitation was extended, they may be inserted in the record. Any statements which may come in not in response to invitation will be submitted to the chairman first for his consideration.

(Telegram from Agnes E. Meyer is as follows:)


MOUNT KISCo, N. Y., July 7, 1950.

Chairman, Committee on Expenditures in the Executive Departments,

The Senate:

As I cannot come to Washington to testify in person on Reorganization Plan No. 27, I hope you will read this statement into the records. I support Reorganization Plan No. 27 and urge the committee to reject the disapproval resolution of Senator Taft for the following reasons: In order to fight the cold war successfully our country must fortify our social ramparts. To achieve this the Nation needs leadership and orderly administration in the fields of health, education, and social security, the numerous and uncoordinated grants-in-aid which the Congress has voted year after year in the various fields of human welfare must be critically reviewed to bring about greater economy and more effective service to the people as a whole. This will be possible only if the Federal Security Administrator has the prestige of Cabinet rank.

Reorganization Plan No. 27 is almost identical with the original Taft-Fulbright bill and meets all the objectives of the medical men and educators who opposed last year's proposal on the ground that health and education were subordinated to welfare. Under the present plan the Under Secretaries of Health and of Education will be appointed by the President, thus giving the Commissioner of Education and the Surgeon General a direct and continuous channel to the President and to the heads of other executive departments.

I realize that there is much opposition to Reorganization Plan No. 27 on the part of the American Medical Association because the medical men fear that the new Cabinet position might be given to the present Federal Security Administrator, Mr. Oscar R. Ewing, who is an ardent advocate of compulsory health insurance. As a consistent opponent of compulsory health insurance I am convinced that Mr. Ewing's advocacy of this measure could not possibly be strengthened by a change in his status. But I should also like to point out that the Senate has to pass on the President's selection for the new Secretary of Health, Education, and Welfare and has the power to reject anyone whom it deems unsatisfactory. Furthermore personal considerations should not interfere with a principle of such importance as Reorganization Plan No. 27. As far as Mr. Ewing's support of compulsory health insurance is concerned it is my practical observation that his arguments are not persuasive with the result that he loses supporters for this measure whenever he advocates it publicly. Therefore the American Medical Association should rejoice in Mr. Ewing's support of compulsory health insurance rather than fear it.

It is important moreover to reject all demands for a separate commission of education and for a separate health and medical administration. Health, education and welfare need close cooperation in the same department. The problems to which they are directed are not separate but single and the same in their impact upon the family and the individual.

Thus Reorganization Plan No. 27 deserves bipartisan support from all those Senators who believe in the social defense of the Nation and want to see the administration of health, education and welfare made more efficient and more economical.


(Letter from Robert L. Johnson is as follows:)

Washington, D. C., July 6, 1950.


Chairman, Senate Committee on Expenditures in the Executive Departments,

United States Senate, Washington, D. C.

DEAR SENATOR MCCLELLAN: Pursuant to the invitation which you tendered in your letter of June 28, I herewith present the views of the Citizens Committee on Reorganization Plan No. 27. I am presently under doctors' orders to cut down on both my university and Citizens Committee engagements and regret I cannot personally appear before your committee. I am also sorry that prior commitments preclude the appearance of our research director, Mr. Robert L. L. McCormick.


Reorganization Plan No. 27 is in conformance with recommendations of the Hoover Commission only to the extent that it grants departmental status to the social-security and education functions of the Government now forming part of the activities of the Federal Security Agency.

The plan is at variance with the Hoover Commission's recommendations in its inclusion of the health functions of the Federal Security Agency in the new Department. Under the Hoover Commission program, the Public Health Service of the Federal Security Agency would be one of the units in a new United Medical Administration.

An important point of variance with principles underlying the Hoover Commission program is the retention of autonomous powers of the Public Health Service and the Office of Education in the proposed new Department of Health, Education, and Security. It is a basic rule of efficient government, as viewed by the Hoover Commission, that responsible and accountable administration requires the vesting of statutory authority in the department head.

Plan No. 27 also falls short of the Hoover Commission program in its failure to include in the new Department the Bureau of Indian Affairs and in its failure to transfer elsewhere food and drug regulatory functions now under the Federal Security Agency.

Because of these marked differences from the recommendations of the Hoover Commission, the Citizens Committee for the Hoover Report is unable to give its support to Reorganization Plan No. 27.


The new Department which was proposed by the Hoover Commission would administer functions covered by its report on social security, education, and Indian affairs. Health functions were dealt with in a separate report on "medical activities" in which the creation of an independent United Medical Administration was recommended.

The Hoover Commission proposed to elevate the education and security functions of the Federal Security Agency to departmental rank but to divorce from them the health functions.

In supporting its recommendation that education and security functions only be incorporated in a new Cabinet Department, the Hoover Commission said: "American concern over the problems of education, health, relief of the needy, aid to the handicapped, and assistance in unemployment and old age is as old as the Republic. Responsibilities in these fields were initially considered to be those of State and local governments.

"With the growth of the Nation, these problems have become wider than local and State boundaries. There is a common interest of all citizens in the education of every citizen. There is a common interest in the advancement of science and in the common dangers from disease. There are obligations to veterans. The problems of unemployment extend beyond State borders. There is generally a recognition of the practical problems which lie in our obligation as ‘our brother's keeper.'

"All these circumstances have contributed to bring these problems more and more to the Federal level. In dealing with these matters, except in the case of veterans, the Federal Government has usually sought to preserve the responsibilities of local government and their agencies of administration in effecting the national purpose.

"It is not the province of this Commission to pass upon the policies that have evolved in these matters. We are concerned with the efficient and economical organization of the Federal agencies as we find them. The organizational problems of education, health, medical care, assistance to the handicapped and aged, and aid to the unemployed permeate every department of the Federal Government.

"There is no perfect organizational arrangement for these functions. Many of them must be performed by specialized agencies like the Veterans' Administration, the Armed Forces, and the Labor Department. As the problems grow, specialization in organization will inevitably grow.

"In our report on medical services, we have recommended a separate United Medical Administration, reporting directly to the President. That agency would embrace the major hospitalization, medical research, and public health activities of the Government and, by its creation, bring about better medical care, development of medical staff, research, and protection of public health, together with large economies in administration.

"In our report on the Labor Department, we recommended the return of several agencies now in the Federal Security Agency to that Department.

"There remain, however, certain most important bureaus or agencies relating to education and security which must be organized into a workable department. They are now, with one exception (the Bureau of Indian Affairs), in the Federal agency

* * *

"We believe that the functions, including education, which we propose to assign to this Department have such an important relationship to the formation of the domestic policies of the Government that the person in charge of the functions should be a member of the President's Cabinet.

"We, therefore, recommend that a new Department to administer the functions as set forth in this report be created and headed by a Cabinet officer."


The Hoover Commission had certain definite objectives in mind in proposing the creation of an independent United Medical Administration in its report on medical activities.

Under the Commission's proposal, the Public Health Service, including its hospitals and functions, facilities and personnel, would be shifted to the United Medical Administration from the Federal Security Agency. Also included in the United Medical Administration would be the general hospitals of the Armed Forces in the continental United States, the hospital functions of the Veterans' Administration, and the nonmilitary hospitals in the Canal Zone.


The immediate purpose, the Commission said, was "to unite the functions now in five major agencies so as to eliminate overlap, waste and inefficiency.' The "much wider and critically necessary objectives" were enumerated as follows: "First: To provide better medical care for the beneficiaries of the Federal Government's medical programs.

"Second: To create a better foundation for training and medical service in the Federal agencies.

"Third: To reduce the drain of doctors away from private practice. The country is now dreadfully short of doctors.

"Fourth: To provide better organization for medical research.
"Fifth: To promote a better state of medical preparedness for war."


The Hoover Commission in its report on "General Management of the Executive Branch" stated that without the essentials of effective organization of the executive branch "all other steps to improve organization and management are doomed to failure."

The Commission declared that any systematic effort to improve the organization and administration must not only create a more orderly grouping of the functions of the Government into major departments and agencies under the President but must "establish a clear line of control from the President to these department and agency heads and from them to their subordinates with correlative responsibility from these officials to the President, cutting through the barriers which have in many cases made bureaus and agencies partially independent of the Chief Executive."

Recommendation No. 14 in this report was as follows:

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