Final determination of the money spent by this Government is, of course, left to Congress. Not one dime can be spent that is not appropriated by the legislative branch-yet historic and inadequate methods have continued.

With Federal budgets running between 35 and 40 billions of dollars, it was felt that this vital work of the Congress should require the most modern systems of budgetary control. Instead, hodgepodge methods. based on historic and traditional practices, have prevailed.

One of the first steps designed to improve fiscal control was the provision for the legislative budget. This was designed to permit Congress at the start of each session to create and chart its own fiscal plan. It was designed to force by joint action of members of the appropriating and revenue committees of the two Houses an over-all appraisal of total Federal expenditures for the new fiscal year, together with a carefully examined estimate of the income.

Last year the effort to have a legislative budget failed when the House and the Senate committees failed to agree in conference on the total Federal expenditures. The degree of error in calculating the expenses was alarming, but was partly due to the lack of advance staff work prior to the convening of the Congress.

To make this valuable provision effective, a skilled full-time expert staff should work throughout the year conferring often with budget officers of the agencies and with the Budget Bureau. By frequent conferences, they could present to the joint subcommittee facts instead of guesses on where economies could be effected in the President's budget. Only by having this factual information can genuine estimates be relied upon.

Undoubtedly the Congress again will have some trouble in fixing the amount of the legislative budget for the second time this year. Some of the reasons for this difficulty are unavoidable due to the turmoil and chaos of the present international situation requiring heavy outlays on foreign aid, national defense, and other items of a like nature far exceeding the scope of any peacetime governmental costs.

But despite these uncertainties and difficulties, the Congress should strive each year to make its estimates more realistic and factual. The fact that we have failed once or twice is no argument for abandoning a necessary and useful fiscal device to consider income and expenditures in an over-all fiscal policy.

If the legislative budget provision is abandoned, then one of the principal gains of reorganization will be lost. No evidence has been presented that the country does not need to have a clear fiscal policy expressed by Congress before appropriations or tax changes are made. It would be a confession of weakness on the part of the legislative branch to abandon it simply because we were unable immediately to make it work.

If the legislative budget should be abandoned, then we would return to the old policy of passing the several appropriation bills each without relation to the over-all total expenditures of Government for that year. And we would continue to consider taxes without relationship to the actual needs of Government revenue, both for current expenditures and for retirement on our gigantic debt of $258,000,000,000.

The idea of the legislative budget is not to strait-jacket the Congress, but to give the Nation our best-considered estimate, in the light of all known information, on what we intend to spend for the coming

year how much we expect to take in-and how much we intend to apply on debt retirement. Is it asking too much for Congress to work toward making this estimate as factual as possible?

Several fiscal aids designed to improve the handling of fiscal matters were ignored completely. Many of these undoubtedly, if adopted, would contribute to better performance on the legislative budget.

Foremost of these was the provision for "show-case" accounting of governmental agencies to give a clear-cut picture on standardized expense categories of their agency operations. This would permit, in an easily understandable listing, the item of major expense for quick comparison with other agencies.

Funds were denied to the Comptroller General for the analysis of expenditures of Government departments, also provided for in the act. This provision was designed to "enable Congress to determine whether public funds have been economically and efficiently administered and expended." While some informal reports on extravagance and waste are now supplied by the Comptroller General to the Congress, it is only on an incidental basis and a byproduct of that office's work in checking on the legality of expenditures.

Also provided for was a study by the Comptroller General of obsolete and useless restrictions which have been placed on appropriation bills in years past and which still require the services of many employees without effecting any real economy. A start of this study has been made but it will not be completed until next year.

The authorized study of all permanent appropriations to determine whether any of these can be eliminated also has not been put into force. The report on the reorganization of Congress also recommended strongly that deficiency appropriations be discontinued except on an emergency basis. Heretofore many items of regular expenditures are carried in deficiency bills, and the continued use of deficiency appropriations, instead of including all necessary money in the regular appropriation bill, tends to defeat sound fiscal control of the agencies.

Although the Reorganization Act authorized a greatly expanded full-time staff for the Appropriation Committees of the two Houses, full advantage of improved staffing has not been used. Although a special investigating staff was set up and performed very well during the first part of the first session of the Eightieth Congress, it was laid off after adjournment.

The careful study and understanding of a 35- to 40-billion-dollar budget requires a full-time study by well-trained experts. I feel that a sufficient staff should be provided to work the year round investigating and studying the actual financial needs of the agencies. During the vital period from August to December 31, when the budgets of the agencies were being compiled, the House Appropriations Committee was greatly understaffed. At one time, only 10 men, classed as experts in their field, were employed by all of the House Appropriations subcommittees.

The original report on the Reorganization Act provided for four experts for each of the appropriation subcommittees to be employed on a year round basis. At the insistence of the leaders of the Appropriations Committee, a change was made and they were authorized to employ whatever staffing they considered necessary. This was done in the belief that they would add sufficient professional personnel

to gain a complete understanding of every item in every appropriation request.

Instead of gaining economy through greater knowledge of all expenses of Government by knowing where reductions could be made and pointing them out to the committee, this part-time use of investigators and outside per diem employees has failed to achieve anticipated economies. To employ too few assistants in this vital field is to be penny wise and pound foolish.

To illustrate, to handle the immense job of the $40,000,000,000 budget, the House Appropriations Committee has a total of 16 fulltime employees above the grade of stenographer. Of these, 11 are clerks, and 5 are investigators. The Chief Clerk is paid $12,000; the assistant $10,000; four clerks from $9,000 to $10,000; and the remaining five from $5,000 to $9,000. Of the five members of the investigating staff, the chief investigator is paid $9,000 and the four receive $5,000.

Other part-time investigators are employed on a per diem basis but their work is not of a permanent nature.

Thus, considering both the clerical and the investigating staff, the 16-man staff must handle a work-load of appropriations for this coming year of more than $2,500,000,000 per employee.

Or to measure the staff expense by the total appropriations, we are devoting only $121,600 for staff expense to supervise, study and recommend action on a $40,000,000,000 budget.

That is the reason why I believe that the Congress should be more alert, not only to carry out the full fiscal reforms so many of which have been virtually ignored, but also to try to devise additional methods to improve our performance in handling fiscal affairs.

Although the reorganization report recommended that Congress transfer the Government of the District of Columbia to home rule of its citizens, we still have many Members of Congress tied up in purely District problems. It is to be hoped that the fine work now being done by Congressman Auchincloss and his committee, and its Director Dr. Galloway, will result in the removal of this extraneous work load from Congress. For example, 12 subcommittees of the two Houses work in handling District of Columbia problems.

I feel that the unused sections of the act, those which are not being put into effect, should be either enforced or that Congress should recommend their repeal. For Congress to leave the law unchanged, but continue to observe only a portion of the act, is to violate its own rule changes. I hope that after your study of the operation of the act, your committee will urge full compliance with all of its provisions so that an adequate trial can be had.

But the business of modernizing Congress is a continuing one and one with which I hope this committee will concern itself through the years. No law nor rules changes should ever be considered the last word on congressional organization, and the process of keeping the legislative branch modern and well equipped to meet present-day problems should be continued year after year.

Hide-bound tradition and so-called "sacred" prerogatives should not be allowed to stand in the way of progress. I hope that despite their great traditions, adequate studies can be given to three important changes into which our committee was denied the right to enter.

These include:

Modification of the rule of cloture to make possible ending of a filibuster;

Substitution of selection by the majority party of committee chairmanships for the unwritten seniority rule; and

Modification of the power of the House Rules Committee to eliminate its veto privilege over other standing committees. Also to prevent, by simple majority vote on a rule, the waiving of all points 01 order which in effect often actually suspends House rules.

That is all, Mr. Chairman.

Senator AIKEN. Thank you, Congressman Monroney, for this very excellent testimony.

I only wish there were time to enter into a discussion of it, but we know that you, as well as the members of the Senate, have a session at this time to which we will have to report. But I can assure you that the members of this committee will want to cooperate with you and have you cooperate with us in the continuous effort to improve the functions of the Congress.

Now the committee likes to accommodate itself to its witnesses. We had six witnesses listed to be heard today. We have heard two of them so far, and one witness has come from out of town and naturally wishes to testify today. So at 1:30 we will take up the matter of lobbying and will hear from Mr. Irving R. Kaufman, special assistant to the Attorney General, who is in charge of the enforcement of the lobbying provisions of the act, and Prof. Belle Zeller, from Brooklyn College, who has made an intensive study of these legislative processes.

The Chair assumes that we have permission from the Senate to sit this afternoon? Having heard nothing to the contrary, we will recess until 1:30.

(Whereupon, at 12:05 p. m., the committee recessed, to reconvene at 1:30 p. m. this day.)

AFTER RECESS

(The hearing was resumed at 1:30 p. m., pursuant to recess.) The CHAIRMAN. The committee will come to order.

Our first witness this afternoon is Mr. Irving R. Kaufman, special assistant to the Attorney General. The committee understands, Mr. Kaufman, that you are in charge of the enforcement of the lobbying provisions of the Reorganization Act of 1946, and we would like to know how you are getting along with your work.

STATEMENT OF IRVING R. KAUFMAN, SPECIAL ASSISTANT TO THE ATTORNEY GENERAL

Mr. KAUFMAN. For the sake of brevity, Mr. Chairman and gentlemen, I have a very short statement to present. It will not take me more than 3 or 4 minutes and then we can go on from there.

I am glad to be afforded the opportunity to appear before this committee to present the views of the Department of Justice with respect to the Federal Regulation of Lobbying Act, title III of the Legislative Reorganization Act of 1946.

Last fall I was appointed a special assistant to the Attorney General to make a survey of the operation of the Federal Regulation of Lobbying Act. The object of the inquiry was to determine its effectiveness.

Thus far, a preliminary study has revealed that only a small number of organizations, associations or individuals who are employed to influence the passage or defeat of legislation before the Congress of the United States have filed statements as required under the act.

We have found that some organizations and individuals which are engaged in influencing legislation have not complied on advice of counsel. In many cases private counsel have given the Act a very narrow and restricted interpretation.

One of the principal reasons offered by such organizations and individuals who have not complied is that they are not within its purview because they claim that their "principal purpose" is not to influence legislation. The phrase "principal purpose" is referred to in section 307 of the act.

It is our position that the phrase "principal purpose" means any purpose which is not merely incidental to the activities of the person or organization in question. Any other interpretation would make the act meaningless and ineffective and would clearly defeat the expressed intention of the Congress.

Senator FERGUSON. You use the expression entirely different from the counsel for the respective lobbyist or people?

Mr. KAUFMAN. That is correct. We take a different viewpoint. Many organizations and individuals have not filed statements as required because they claim that "principal" means "primary" or "major." Our interpretation is amply substantiated by the legislative history of the act and by decisional law. This view, in our opinion, removes any doubt, as to those who are covered by the act. We think that a judicial interpretation will support our view.

However, it should be pointed out that the act has not been tested. Although there are numerous cases construing the phrase "principal purpose" as we have interpreted it, a court might choose to disregard such interpretation. In the event that the statute is construed by the courts in such a way that it becomes ineffective we shall then make specific recommendations whereby the Federal Regulation of Lobbying Act could be strengthened.

Senator FERGUSON. Could you give us a hypothetical case, what you might call a typical case, where the counsel would not consider it as principal business, and where you would contend it was principal business?

Mr. KAUFMAN. Yes, I believe I can, Senator Ferguson. I have observed that, for example, in connection with the CIO and AFL and United States Chamber of Commerce, while they have many different functions which they render to their membership, one of their important functions is that of attempting to influence legislation. Now, section 305 of the act requires a filing with the Clerk of the House of the amount of receipts and expenditures for lobbying purposes. In my conferences with counsel-and that was a policy which we thought should be followed, in view of the provisions of this act, that we should discuss it over a table-counsel took the position that in view of the fact that they rendered so many different functions to their membership, they were not required under the statute, to file the statement, because lobbying was not their principal activity.

Senator FERGUSON. In other words, they may have had 50 activities, of which lobbying was one?