Representative VINSON. Did not a veto message in the Congress precede the discussion, when it passed upon it?

Senator BYRNES. That is correct. As the result of the veto of President Wilson there was a discussion.

The CHAIRMAN. And it was generally conceded in the Senate that the President's veto was sustained by the argument.

Senator O'MAHONEY. I should like to call attention to item 5, in column 3, on the list sent up by the witness in which it appears that the witness is recommending the approval of contracts by the Auditor General. I should like to obtain the opinion of the witness as to what sort of a function that is, executive, judicial, or legislative.

Mr. MERIAM. The question of the approval of a contract is whether the procedure laid down by Congress governing the making of that contract has been followed. The wisdom of making the contract is not passed upon by the Comptroller General. The illegality of it is passed upon by the Comptroller General. If the laws call for opеL competitive bidding the Comptroller General will see that open competitive bidding has taken place.

Senator O'MAHONEY. Is that not an executive function?

Senator BARKLEY. Is the function the same as that performed by the Attorney General if he is asked his legal opinion on a given state of facts, or the attorney or solicitor of any department who is asked an opinion on that? That does not make it legislative, does it?

Mr. MERIAM. Well, from our point of view that would be in the nature of a quasi-judicial act.

Senator BARKLEY. Every act performed by any legal adviser of any department as to the legality of a certain course of procedure may be called a quasi-judicial act, but it is, nevertheless, executive or administrative.

Representative VINSON. Did you make response to Senator O'Mahoney's question?

Mr. MERIAM. I think I did, Senator. If I haven't answered it sufficiently I would be glad to do so.

Representative VINSON. You haven't answered it to my satisfaction. I would like to know just what sort of an act that is, where you have the approval of a contract. Is that executive, judicial, or legislative?

Mr. MERIAM. The question in our judgment is that the law provides that certain procedure must be gone through in connection with the making of that contract. The Comptroller General passes on the question of whether that procedure has been observed. If that procedure has been observed the contract is entirely legal and binding. If that procedure has not been observed the executive officers have exceeded their authority, have gone beyond their power, and they have entered into a contract in a way that was never authorized by Congress and therefore the money was not used in the way in which the money was appropriated.

Representative VINSON. Was it an executive, judicial, or legislative act? It has got to be one of the three, certainly.

Mr. MERIAM. In the case of where they are passing on the legality in that respect it becomes in nature a quasi-judicial decision.

Senator O'MAHONEY. May I say in this connection, Mr. Vinson, I was satisfied before, from the witness's answer, that he has not

explained away the obvious executive character of the act, and it cannot be explained away, in my opinion.

The CHAIRMAN. You have no doubt that the item to which you have referred is an executive act rather than a legislative act?

Senator O'MAHONEY. None whatever. Of course, it is executive. Mr. SELKO. Mr. Chairman, my statement was to take exception to the point of view which Senator O'Mahoney first raised. I feel, and the feeling of the Institution is, that when the Comptroller General disapproves a contract as being not in accordance with the provisions as set down in the Appropriation Act and the procedure as set down by law, he is not performing an executive action, because he has no authority to carry out his decision. He merely points out to the administrative officer that this contract does not have, in his opinion, the sanction of law.

Senator O'MAHONEY. Is that any less an executive act than the opinion of the Attorney General, let us say, given to the Commissioner of Indian Affairs with respect to the interpretation of a law of Congress defining the powers of the Commissioner of Indian Affairs?

Mr. SELKO. No, sir.

Senator BYRNES. How about the Treasury, which furnishes the furniture, and the Treasury determines, when the bids are filed, that the lowest bidder is not the responsible bidder and awards the contract to the next lowest bidder, and it comes to the Comptroller and he acts on it; is that an executive action in disapproving the action of the Treasury in not giving it to the lowest bidder and giving it to the next lowest bidder?

Mr. SELKO. No, sir. In our opinion, it is not executive action.
Senator BYRNES. What action is it?

Mr. SELKO. I would say, as Mr. Meriam has said, when that action partakes of a judicial character that it is, therefore, a quasi-judicial action. It is not an executive action, because it is not an act of an executive officer carrying out his particular authority as given him by Congress.

Senator BARKLEY. According to that theory, Congress has a lot of petty little agents scattered in all departments that are legislative representatives rather than executive officers.

Mr. SELKO. No, sir. That brings up another point. The Solicitor of the Treasury, or the Attorney General, appointed by the President, are officers appointed by the Executive for the purpose of giving the executive officers legal advice on actions which the executive officers themselves intend to or contemplate carrying out. The Auditor General-the Comptroller General, as he is now called-is an officer who, while appointed by the President, is not eligible for reappointment and cannot be removed except by joint resolution of Congress. He is appointed and holds his office for the purpose of advising the executive officers as to whether their action, contemplated or taken, is in accordance with the will of Congress.

Senator BARKLEY. The mere fact that he has to be removed by joint resolution of Congress does not make him a congressional agent. Mr. SELKO. No, sir.

Senator BARKLEY. Congress can modify the provisions of law with respect to the removal of many officers, just as it did in the case of the Federal Trade Commission Act, so that they could only be re

moved because of certain actions or failure to perform certain duties or certain stipulations set out in the law.

Mr. SELKO. Yes, sir.

Senator BARKLEY. The Comptroller General has made no reports to the Congress, he has not been held accountable to the Congress, he has not advised Congress what he has done or has not done since he has been appointed.

Senator BYRD. Would you say he hasn't made reports, Mr. Selko? Mr. SELKO. He is supposed to, sir. It is in the law. The Budget and Accounting Act provides that he shall make reports to Congress. Senator BYRD. In fact, they have been made.

Senator BARKLEY. In a fashion, but no comprehensive reports.

Mr. SELKO. We recommend that he make a more detailed and comprehensive report than he has been making.

Senator BARKLEY. He is required by law to report to Congress. Senator BYRD. How many independent agencies do not report to Congress?

Senator BARKLEY. Still that does not take away their executive or administrative character.

Mr. SELKO. It appears to us fairly clear that Congress, in limiting the power of the President to remove the Comptroller General, and also removing from the Comptroller General the possibility of being reappointed to office, had in mind making that officer directly responsible to Congress and acting as an agent of Congress rather than as an agent of the executive branch. Now, we just simply take the position that Congress is entirely within its right in doing that, and Congress can do whatever it wants to.

The CHAIRMAN. The character of an officer, whether he is an executive, legislative, or judicial officer, is not determined by his name, or the limitations upon the time of his service, or any attempt to restrict existing powers of removal as to executive officers; his character is determined by the functions that he is called upon to perform. If he performs a function that is essentially an executive function he is an executive officer, although you may call him by name a legislative officer. You do not change his real character in law by giving him a name, or by requiring him to report to somebody.

Now, the question is: What are the essential characteristics of the act to be performed by this officer, whether you call him the Comptroller General, the Auditor General, or something else, and the answer to that question determines his status as an officer, whether executive, legislative, or judicial.

The Chair feels that we perhaps have lost this phase of the subject for the present. I am more interested in understanding what the representatives of the Brookings Institution recommend.

I asked you a question a while ago, whether you recommend that the Comptroller General be given preaudit power, the power of preauditing accounts, and I understood you to say that you did make that recommendation.

Mr. MERIAM. Yes, sir. We would like to see the administrative officers in charge of a bureau able to get in advance of taking any action an authoritative, binding statement that the object for which they propose to spend the money has been authorized by law, and that the procedure which they propose to follow in spending that money is the legal procedure prescribed by the Congress.

The CHAIRMAN. Under your plan there would be no necessity for a post audit?

Mr. MERIAM. The postaudit would be necessary, sir, in connection with the amount of money involved. That is, after your procedure has been declared to be legal, your object is legal. If you have exceeded the appropriation limitations, that is, if you have spent more money than you have left, that is the only remaining item for a postaudit. The legality of the object and the legality of the procedure would be passed upon in advance.

The CHAIRMAN. And you would make that determinable primarily by the Auditor General?

Mr. MERIAM. Yes, sir. They are the fellows that are going to pass on it finally. The old Comptroller of the Treasury used to pass on that, just the same as the Comptroller General now passes on it. They were administrative officers in the old days under the Comptroller of the Treasury.

Now, before I go ahead and spend money I would like to know definitely that I have taken the proper action, that my object is legal, my procedure is legal, because then it means that it goes right straight through. Where we get into trouble is in not knowing the procedure. It is more likely to be a procedural difficulty than a question of what we do is something irregular. It may be that people in our department, our solicitor, for example, would not necessarily know about the detailed procedural law. As a matter of fact in the old days, in the Department of Labor, I would rather have had the opinion of our disbursing officer than I would the opinion of our solicitor, because our disbursing officer was a man who spent years in the Government and was thoroughly familiar with these rules and regulations. Our solicitor was appointed from the outside and he himself generally would consult the disbursing officer, because the disbursing officer was a man who was familiar with the statutory law, the rules and regulations and decisions made under it. The lawyer coming in from the outside is not ordinarily familiar with that great mass of law and decisions.

There are a lot of laws scattered throughout. For example, a general law prohibiting the administrative officer from paying the expenses of his subordinate for attendance of conferences, you have got, let us say, no authority to send somebody to a conference, and if you send a person to a conference the first thing you know the expenditure is disallowed.

Now, that disbursing officer, when I was in the service, was the man who had all that law at his fingertips. Of course, it was subsequently reviewed by the Comptroller of the Treasury. If the disbursing officer had slipped up then of course there was a disallowance. The result would be it would come back to the bureau, to the business manager of the bureau, and the business manager of the bureau would have to come back to the employee; he would have to get the money back from the employee.

We would like to see a situation in which the administrative officer can get a definite authoritative ruling in advance regarding the legality of his object, the legality of his procedure, because that is where the rub comes in.

Representative VINSON. Assume that a pre-audit unit were independent of any department and was responsible to the Executive, how would that work out? I mean was responsible to the President.

Mr. MERIAM. I do not know that there has been any material difference, as far as the administrative officers are concerned, between the present situation of reporting to the Comptroller General and the old one of reporting to the Comptroller of the Treasury. In neither case could the Comptroller of the Treasury nor the present Comptroller General be reversed by anybody. His decision was final, it was binding, nobody could reverse him. If you got in the Government service somebody whose opinion is final, a comptroller dealing simply with administrative transactions, we favor just as far as possible letting him notify the responsible administrative officer as to what he can do under the law and the prescribed procedure at the earliest possible moment. Then if you find that something you have got to do is illegal you are given notice of it at once and you can start your machinery for getting your authorization.

On the other hand, if you go ahead and spend the money, you have got it all spent, and then it is subsequently disallowed, you have got to go through all the red tape, delay, and cost of going back and doing it over again, and doing it correctly.

Representative VINSON. I mean, Mr. Meriam, whether or not you think it would work out satisfactoriy, if this preaudit unit were independent of any department and responsible to the Chief Executive?

Mr. MERIAM. You can do it either way.

Representative COCHRAN. Do you recommend a preaudit of every

thing?

Mr. MERIAM. Yes, sir; a preaudit just as far as you can get it. Representative COCHRAN. You want to have a preaudit of all expenditures of the Government?

Mr. MERIAM. Of course, a preaudit of all of this without exception is impractical. You would go just as far as you could.

Senator BYRNES. Who would determine how far you can go?
Representative COCHRAN. How far would you go?

Mr. MERIAM. You can go, by an adequate system of decentralization, you can go a tremendously long way.

Representative COCHRAN. The law at the present time provides that the disbursing agent would call upon the Comptroller General for a preaudit, where he is in doubt.

Mr. MERIAM. Yes, sir.

Representative COCHRAN. Now, as I understand it, the preaudit is only about 12 to 15 percent.

Senator BYRNES. You are going to leave it to the administrative official in the future to determine those cases that are in doubt, as the Congressman suggests, and ask him to interpret which ones he is to have audited and say as to others that he need not have them audited?

Mr. MERIAM. There are a whole bunch of them, of course, that do not require a preaudit in that sense.

Senator BYRNES. Who is going to determine that question as to whether it requires a preaudit?

Representative COCHRAN. Then you recommend a preaudit of all expenditures?

Mr. SELKO. We recommend a preaudit on the present system. The CHAIRMAN. We will have to suspend now. We will suspend until Wednesday morning at 10 o'clock.