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have here the larger units of business oganization, bigger corpora. tions, bigger businesses, and we have set the pace in what you would call administration and in management, and in administrative management.

It may well be that the workers of the community have not always obtained the full value that comes out of the administrative managements of big corporations, nevertheless the management is there, and if any country in the world now wants to start out on a largescale piece of management it automatically turns to the United States to see how we do that. The German system, in considerable measure, was copied out of ours. The British, when they tried to organize big-scale business, sent over here, and, curiously enough, when Russia wanted to organize something it sent over here for American engineers, American executives, to show them how to set up various kinds of managerial organizations, using our own people to do it.

That management movement goes back to about 30 years ago, out of the Taylor system, the Emerson system, the application of technology to business, organization of large-scale units, until now we have in the United States, beyond any doubt, the first place in executive organization, and we very justly pride ourselves on being the best managers in the world. I think that claim, with all due regard to the counter-claims of other nations, could be substantiated.

You have also got a good deal of management running down now into agriculture, large scale of organization like the Grange and the Farm Bureau and others. The organized-labor groups are now beginning to take an interest in how they will set up an efficient management of their organizations.

A good deal of progress has been made in the cities and in the States with the organization of administrative management. You have now about 400 managers of cities. Some of those have brought the city administration up to a high level, as in Cincinnati.

A large number of States have undertaken the job of reorganizing their State administrations. We have been over those before here. We know they did it in Massachusetts, New York, Illinois, and I need not remind Senator Byrd of the work he did as Governor of the State of Virginia. We have been indebted to these States for many useful suggestions. Senator Byrd recoiled somewhat from the paternity of this plan, apparently, but we have the goods on you, Senator, we have your fingerprints, or your blood test, or whatever it is. This child looks to you as its father.

Senator Byrd. You cannot disinherit your own child.

Mr. MERRIAM. You cannot put the bar sinister on this child of yours, you know. We will nail it right on you.

I want to deal just a few minutes more, with your permission, on the general plan, and then we will go back into the practical details. You might raise the question with me: “Are you gentlemen on the President's committee interested in nothing but developing executive management? Is that the only interest you have as American citizens?” Our answer to that is that that was our particular assignment. It was not our task to deal with Congress, and, secondly, not to deal with the courts. Nevertheless, you might say, "Are you not concerned at all with the balance of power as between the Executive and the Congress ?” Well, with much timidity, and I trust with due

modesty, we did go out of our way to try to show how the accountability of the Executive to the Congress could be worked out under a system of administrative management on the Executive side. There is a balance of power set up in the Constitution, and there is a relationship, certainly, between Congress and the Executive that we thought had at all times to be most carefully observed and preserved.

In one section of this report we dealt with the accountability of the Executive to the Congress. I want to call your attention to the fact that we set up, very tentatively, because we did not want to seem to intrude in any way by offering advice to Congress, but only incidentally and necessarily as a part of our work, we set up tentatively the plan for accountability of the Executive to Congress on three lines: One a line of finance, one a line of civil service, one a line of planning

Since we were proposing in this scheme to set up in the White House three principal agencies of budget, personnel, and planning, we suggested the possibility of three joint committees, or concurrent committees of Congress, dealing with the three overhead or over-all functions of the Executive. The picture in our minds was that if these three agencies were set up right in the White House-as the President himself said, right under his immediate wing—that would give you three new overhead agencies. Then Congress, by checking up on these three overhead agencies, not merely accounting but the other two, taking them under its wing, so to speak, you would have corresponding to the over-all administrative scheme an over-all congressional scheme. And in that way you could keep track of the various bureaus or departments on an institutional level. You could deal with the three branches of the overhead Executive and get the same sort of a watchtower observation of what is going on in the Executive, and the same watchtower effect by a view of Congress through three concurrent or joint committees.

What you would have then would be the President with budget and finance, civil service, and planning, plus three corresponding committees keeping track of those three overhead agencies. If you set up that powerful kind of Executive management review it would afford you the means of getting immediate contact with what is going on in the new overhead set-up.

Representative Vinson. Mr. Chairman.
The CHAIRMAN. Mr. Vinson.

Representative Vinson. In the report, or in the bill that has been presented, did you provide for the setting up of the committees, of make suggestions that the three committees be set up?

Mr. MERRIAM. We proceeded very mildly on that point, not wishing to have Congress say, "Well, we did not ask you for any suggestions of congressional organization”, but we pointed out how that could be done, in the report.

Representative Vinson. I haven't seen it.

Mr. BROWNLOW. We did set up, in this suggested draft of the bill, a joint committee on accounting.

Representative VINSON. Mr. Brownlow, I know that, but the gentleman refers to three committees.

Mr. BROWNLOW. Only one is in the bill. The three are in the report.

Senator BARKLEY. It is not necessary for the bill to contain the provision for Congress to set up those committees. We can do that without any report.

Representative VINSON. In the bill one committee is provided for. I was not asking whether it is necessary to do it or not.

I just wanted to know whether I had overlooked the suggestion about the other two committees.

Mr. MERRIAM. Our recommendation is on page 50 of our report. I can read it. It is just one paragraph:

With respect to nonfiscal affairs, the creation of similar special committees or of a joint committee to keep currently informed of the activities of the three managerial agencies dealing with budget, personnel, and planning, which we recommend should be set up directly under the President, would go far toward lessening the evil effects of the present lack of coordination,

Thus the principle of the accountability of the Executive to the Congress might be made effective in action.

Representative Vinson. I want to say that I just overlooked that, or had forgotten about it.

Mr. MERRIAM. I might say also—I do not know whether it is out of order here to say it—that the principle of legislative predominance in a democratic government has no stronger defenders than the President's committee. Last summer Mr. Brownlow and I were over in the European countries—not at the expense of the Government, Senator—and we attended, in Warsaw, a meeting of the International Institute of Administrative Science.

That is made up mainly, if not wholly, of public officials from the principal European countries. If I may take a minute I can just refer briefly to what Mr. Brownlow and I have always called the battle of Warsaw. There were a number of Fascist governments there that tried to put through a resolution endorsing not merely the organization of the executive branch of the government but also declaring that the executive must have the personal direction and leadership, subordinating the legislative branch of the government to the executive. I myself took up the battle against them, reinforced by Mr. Brownlow and by others of the American delegation, and the struggle or the battle between what was called the American method and the dictatorial systems was observed with much pleasure by representatives from Switzerland, Belgium, Holland, Egypt, and what not. We finally won out. We were able to show that in the United States we were not interested at all in that kind of resolution, because we had set up from the very beginning the system of congressional priority. We had no notion of changing it, we were not interested in the slightest degree in discussing the subject. We also succeeded in defeating the resolution and obtaining the passage of quite a different kind of resolution, indicating legislative supremacy, and showing that we were interested in administrative organization subordinate to the general priority of the elected representatives of the people.

Representative GIFFORD. Dr. Merriam, may I suggest something? From your explanatory remarks, and to me somewhat apologetic, that you did not want to trespass upon the field of legislation, that your assignment was not an assignment from Congress, in view of those statements must we infer that you would have written a different kind of report if you had received an assignment from Congress?

Mr. MERRIAM. If we had been asked by Congress how to set up agencies under the supervision of congressional authority, I suppose that would be quite a different kind of report, Congressman.

Representative GIFFORD. I feel, from your remarks, that it would be, that if you had the assignment from us, having in mind our feeling and desirability of holding to our own prerogatives, that there might have been a rather different report presented to us. It rather disturbs me.

Mr. MERRIAM. I do not mean to disturb you, Congressman; I mean to encourage you in a way. I said there could be a study of organization of agencies assisting Congress. That was not our assignment.

Senator BARKLEY. Your report would not have been different as far as the executive set-up is concerned, but you might have gone a little further as to the congressional set-up if we authorized you to do it?

Mr. MERRIAM. Yes; we would have gone further on the three committees, giving you illustrations and examples of how they might work out. We might have gone further. I haven't thought that through. We might have gone further on legislative reference, bill drafting, and various other things. I do not want to go into that: but I have my own ideas about that. As Senator Barkley said, that would not have made our report any different from what it was on the executive side, but it would have, of course, carried you far over into the congressional side. Now, I think, Congressman, I was properly apologetic for having explained why we did not want to get into the position of going beyond what we were supposed to do.

Representative GIFFORD. I should not have used the word “apologetic perhaps, but your own remarks seems to show that if you had the assignment from the Congress that perhaps you would have been more careful that we did not lose our powers.

Mr. MERRIAM. Now, as far as the principle goes, we would not have been more careful in preserving the principle, but as far as the presentation of the instruments, the mechanisms are concerned we probably would have gone further. For example, in my own State, to make a concrete case, we spent quite a while in Illinois going over with the general assembly the proposition of trying to build up for them legislative reference bureaus, bill-drafting bureaus, things of that sort, in earlier years. You have that here now.

Now, I will only summarize, on the practical side, the two points, perhaps, that have been made here. I think attention has not been directed to the recommendation we made for decentralization of Federal administration in order to prevent too great concentration of power and congestion in the Capital City. We did not go into that in detail on this occasion, but it was our idea that the Bureau of the Budget should make a continuing study of the ways and means by which Federal administration could be prevented from piling up too heavily in the city of Washington; that local centers, wherever it seemed to be appropriate, should, both in the interest of economy and in the interest of efficiency, be built up.

There are now about 108 different types of Federal field agencies. There are towns where there are as many as 50 or 60 of those concentrated. They are not brought together as closely as they might be, and, in general, it was our judgment that there was not as much

conscious push as there should be toward keeping out of Washington too great concentrations in administration.

Representative GIFFORD. Mr. Merriam, I have one other suggestion and I hope it will be helpful to you. You say these three agencies are to be set up to find out what is going on in the executive branch; is that right?

Mr. MERRIAM. Yes.

Representative GIFFORD. The feeling of the committee seems to be that the purpose of setting up these agencies is to find out what went on, not what is going on.

Mr. MERRIAM. I mean what is going on with the view of promoting the appropriate congressional policy.

Representative GIFFORD. Exactly. These three committees you suggest are to define simply what went on after the thing happened. to investigate only what has been done. This has constantly been expressed thus far.

Mr. MERRIAM. Yes; I know what you mean, Congressman, very well, indeed, but that goes to the question of administration. Congress is a lawmaking body, the greatest policy-determining body in the world, and it is well known that on all questions of general policy it is certainly supreme.

Representative GIFFORD. Within the limits of the Constitution.

Mr. MERRIAM. Yes. It is not a question of watching what happened after it happened, but of getting facts as the basis of deciding what Congress wishes to do, representing the American public.

The second point I wanted to make here, which has not been so much noticed, is that it was the judgment of the committee that the merit system and career system, if fully developed, tends to liberalize the administration; that is, if you have well-trained, competent officials, they are, on the whole, more likely to deal with the people of the United States in a democratic manner than if you have a haphazard system in which you do not have the same sense of responsibility.

What I have in mind here you can see by looking at some of the local agencies. The post office, for example, is a popular service in the cities and in the country. The mail carrier in the cities and rural-delivery men in the country are generally well thought of. Most of them have been there for a long period of time and they have developed the knowledge of their duties, the knowledge of how to meet the public, and they render a kind of service that does not irritate as much as some other types of service.

Senator BARKLEY. Do you think that is always true in the departments in Washington?

Mr. MERRIAM. I would not think it was always true, Senator Barkley. I have had my own toes stepped on on several occasions; but I think, on the whole, yes.

Now, I can just sum up briefly. You are extending me an unusual courtesy in allowing me to carry on this monologue as long as I have without much interruption. I can sum up again what Mr. Brownlow said in the beginning, as to what we found.

We found the most powerful executive in the world at the head of the biggest corporation in the world without personal assistance of the type that other corporations of anything like that magnitude would have at once.

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