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Mr. MERIAM. General Lord, General Dawes, and Colonel Roop always reported directly to the President.
Representative TABER. Did not Mr. Douglas also ?
Representative Vinson. But that does not make it an independent agency, as we generally understand that term.
Mr. MERIAM. We would like to see that ambiguity removed and have it definitely recognized that it is directly under the President and that it is his agency for managerial control. We believe that the situation would be clarified if that action were taken.
Senator BYRD. You and the President's committee are in substantial agreement on that proposition.
Mr. MERIAM. Yes, sir.
Senator BARKLEY. I was just going to ask that question, as to whether that is not what the President's committee recommends also, so there is no difference between you on that.
Mr. MERIAM. No, sir; there is no difference between us on that. The Senator's question, as I recall it, was directed to the change we were proposing over the existing system.
The CHAIRMAN. I intended to follow that with the question you now answered, namely, what is the distinction in your mind with respect to that phase of the subject and the plan of the President's committee. You say there is substantially no distinction in that item. I do not quite understand yet how important that is, since it appears that the Budget is now merely housed in the Treasury and nominally under the Treasury Department.
Mr. MERIAM. I think it would become more important if the Budget Bureau were expanded to the extent which it should be, and it would remove all question of whether the Secretary of the Treasury was supposed to have any particular influence over the Budget Bureau. We would prefer to see the Budget Bureau entirely independent of any Cabinet officer who is responsible for large expenditures within his own establishment.
The CHAIRMAN. What, in your opinion, is the outstanding difference between the system that prevails, that which is recommended by the President's committee and that which your organization recommends, with respect to control?
Senator BYRD. Mr. Chairman, would it not be better to let him continue? Here are these different items, numbers 4, 5, 6, 7, and 8.
The CHAIRMAN. Very well. What I am trying to do is to get clear in my own mind what the real issues are between the two reports and what changes you propose to make in the existing arrangement.
Mr. MERIAM. The major issue between our group and the President's committee is on the question of where the control should be located to prevent an illegal or unauthorized expenditure. We agree with the President's Committee on Administrative Management that the question of the spending of an appropriation for a legal purpose in a legal way is entirely an administrative or executive matter, but when an executive officer, or an administrative officer proceeds on an illegal basis either spending money for an object which was not authorized by law or failing to follow the definite procedure which the Congress has prescribed to govern that type of transaction, or spending more money than the Congress has appropriated, then that is a type of auditing control. Auditing control should, in our judgment, be independent of the executive branch of the Government. Congress should continue its past practice of setting up an officer who could make a ruling that the transaction involves an illegal expenditure and cannot be approved. Now, we believe that such power should be in the hands of an independent agency answerable directly to Congress.
Senator BARKLEY. Even though the expenditure is made illegally it is still an administrative matter. I do not see where you draw the distinction between a legal expenditure being an administrative matter and an illegal expenditure, made by the same man, being not an administrative matter.
Mr. MERIAM. They are both actions of an administrative officer, but one is a legal action, well within his powers, and it is merely a matter of his discretion.
Senator BARKLEY. Now, is the Congress any better qualified to sit beside this man and pass upon the legality of his acts than some other administrative officer above him or independent of him?
Mr. MERIAM. Well, you have got the situation in which there are a large number of laws which have been developed by the Congress over a long period of years. For instance, a law on purchasing that calls for competitive bidding, open and competitive bidding. Now, if an administrative officer chooses to buy without any competitive bidding he is going beyond his powers, he is going beyond his authority, he has no legal right to spend the money in that way. Now, under our existing system we have the Comptroller General who will audit those transactions and disallow the administrator's action, because he did not comply with the law.
Senator BARKLEY. I agree with that, but it isn't any more the duty of the Congress to follow that up and be alongside of this officer all the time, to keep him from doing that, than it is for some other administrative officer to be responsible for seeing that that is done.
Mr. MERIAM. Both are responsible.
Representative Vinson. That goes to the question of the practical side of it.
The CHAIRMAN. That is the question I am going to raise now.
Representative Vinson. It seems to me that the question of power is involved here.
The CHAIRMAN. Your plan, as I understand it, is to continue and expand the preaudit in the form of a control through a legislative authority; is that correct?
Mr. MERIAM. Yes, sir.
The CHAIRMAN. Now, has your organization given thought to the question as to whether Congress, after it makes an appropriation and fixes the conditions for its expenditure, can follow the appropriation and enforce those conditions through a congressional agency? In other words, under the Constitution, as has been frequently pointed out, the enforcement of the laws is directly and expressly charged to the Executive. Congress has no law-enforcement power. Even assuming an administrative officer should undertake to expend a fund in a questionable way is it the duty of Congress, the responsibility of Congress to see that he does not do it? What is the control that you
are proposing? Is it an executive function or is it a legislative function? That is the question that rises in my mind, and I think we will have to answer that when we come to writing the provision of law in the bill relating to this subject.
Mr. MERIAM. I have a written answer to your question, Senator. I more or less anticipated a question of that type to be raised.
Representative Vinson. Before we go into that I would like to have the background of the gentleman. Are you a lawyer?
Mr. MERIAM. I have been to law school but I am not a practicing lawyer; no, sir.
Senator BARKLEY. Are you admitted to the bar?
Representative Vinson. You have never had any experience in courts?
Mr. MERIAM. No, sir. Representative Vinson. I want to get your background, as to what kind of a lawyer you are.
Mr. MERIAM. No; I am not much of a lawyer. We at the Institute for Government Research are not constitutional lawyers.
Representative TABER. I think perhaps you should give us your background. Perhaps it would be just as well at this time to give us your experience since you graduated from school, what activities you have been in, so that the committee may know. It has been customary with the other witnesses and I think you should do it. It is for the benefit of the committee.
Mr. MERIAM. I took my bachelor's degree and my master's degree at Harvard, specializing in social sciences, particularly economics and government. I then came into the United States Government service, in the United States Census Bureau. I served in the Census Bureau for 7 years.
Representative VINSON. In what capacity?
Mr. MERIAM. I ended up as division chief. I was appointed orig. inally as a statistical editor. I was then appointed Assistant Chief of the United States Children's Bureau, at the time the Children's Bureau was established. I served there for 3 years.
I then resigned to go to the New York Bureau of Municipal Research where I worked with Dr. Frederick Cleveland who had been the director of President Taft's Commission on Economy and Efficiency.
In 1916 I came back to Washington when the Institute for Government Research was established, and I have been connected with the Institute for Government Research ever since.
During the World War I went back into the service for 3 years as production manager of the Division of Planning and Statistics of the United States Shipping Board, where I was associated with Dr. Edwin F. Gay and Wesley Mitchell, and that group.
Then I did a good deal of work for the Congressional Joint Commission on Reclassification of Salaries. I was the statistician. Subsequent to that I worked with Senator Sterling. I was his aide
in connection with the reclassification legislation in 1923. Then I was down in North Carolina for a while with the salary and wage commission of that State. Then I made a survey of Indian affairs at the request of the Secretary of the Interior. I participated in one or two of our State surveys.
While I was in the Census Bureau I went to night law school. I went to law school not with the idea of becoming a lawyer but because I wanted that education to supplement the other education I had in the social sciences. I think that is probably too detailed. We at the Institute for Government Research are not constitutional lawyers. We were not retained by the Congressional Committee on Reorganization to pass on the constitutionality of the past practice of the Congress in limiting the power of the Executive with respect to the expenditure of public funds. The Congress has from the earliest times assumed that it had that power. It set up in the Treasury Department a Comptroller of the Treasury whose decisions could not be reversed by anyone in the executive branch of the Government, not even by the President of the United States. In 1921 it went further and provided a Comptroller General as the head of the General Accounting Office immediately under the Congress, and provided that, although the President should appoint the Comptroller, that officer could only be removed during his 15-year term by joint resolution of Congress.
In view of the long history of limitation of the power of the Executive in this respect, and in view of the clear language contained in article I, section 7, of the Constitution, we have assumed that the constitutional grant of executive power to the President was necessarily restricted by article I, section 7, of the Constitution. It seemed to us as laymen that no administrative officer could, through executive authority, be granted a power of spending in excess of appropriations, for objects for which appropriations were not made, nor in any manner other than that prescribed by the Congress, if the Congress had by law established a procedure. As laymen we as. sumed that the Congress could, by law, establish a system of finan. cial administration that would make article I, section 7, a working law effectively binding on all officers of the Government and not leave it as mere hortatory language.
Our own searches have failed to reveal any decision by the Supreme Court that specifically passes upon the question at issue, namely, whether the Congress acted within its authority in establishing a Comptroller of the Treasury whose decisions could not be reversed, even by the Chief Executive, or subsequently in establishing an independent Comptroller General who could not be removed by the President. We have been informally advised by constitutional lawyers that this issue has never been passed upon by the Supreme Court.
We are, of course, aware that in the Myers decision Chief Justice Taft used words which apparently suggest that in the case of officers exercising quasi-judicial authority the Congress might provide that the decisions of such officers could not be reversed by the President, and that in the Humphreys case the Congress may restrict the power of the President to remove quasi-judicial officers. But these cases are not on the present issue, for they do not involve article I, section 7, of the Constitution, nor the power of Congress to control the expenditure of pr. lic moneys by administrative officers.
We recognize that the Comptroller General, in interpreting the meaning of appropriation acts and in interpreting and applying the great body of other laws restricting and governing the expenditure of public funds, may be said to be acting in a quasi-judicial capacity. But he is not, as a rule, judging between two private parties or between the Government and one private party, although in a few cases a private party may be involved. He is ordinarily, in a sense, deciding between certain administrative officers on the one hand and the Congress of the United States on the other for the specific purpose of giving legal effect to article I, section 7, of the Constitution. Appropriation acts, and the great body of administrative law governing expenditure, in a relatively small number of cases, have to be interpreted and applied. The issue here is whether the executive branch is constitutionally free to interpret them for itself without congressional control, or whether the Congress has the authority to establish an independent officer or agency, not under executive control officially, to interpret the law and interpret the acts. That issue we believe has never been passed upon by the Supreme Court, and therefore the Congress is free to continue to act upon the assumption that in matters of the legality and regularity of expenditures it has authority to act, on the ground that the executive power extends only to legal expenditures made in pursuance of law. In a Government of divided powers, or, in other words, a government of checks and balances, it would seem that the Congress would have the power to check an illegal or irregular expenditure.
Representative GIFFORD. The what!
Mr. MERIAM. The irregular expenditure. By "irregular" I mean one in which the Congress has specifically provided the method by which the money should be spent and the administrative officer spends it in some other way than the one prescribed by Congress.
Representative GIFFORD. You mean by padding the expense account?
Mr. MERIAM. I have more in mind, a situation in which an act of Congress calls for competitive bids, but the administrative officer fixes the specifications up in such a way that only one fellow has got a look-in.
Representative GIFFORD. Has the Comptroller General power to check the expenses of administrative officers!
Mr. MERIAM. That is where the largest amount of conflict between the Comptroller General and administrative officers comes in, in connection with contracts, purchases, and construction.
Representative GIFFORD. Limit that to the expense of traveling. If the Comptroller General thought the expense was too large would he have the power to cut it down?
Mr. MERIAM. The Comptroller General could examine the traveling account.
Representative GIFFORD. Then there are no instructions of Con
gress about it?
Mr. MERIAM. No, sir. The administrative instructions
Representative GIFFORD (interrupting). Never mind the administrative part of it. What about the illegality? How can a padded expense account come under an illegal act, against an act of Congress?