We do not say that this is intended, and probably it is not, but a statute should not be passed which is so indefinite and uncertain of meaning that it could be so construed. Let us, however, consider some of the specific illustrations, which certainly are within the intent.

The first is preparation of estimates of appropriations. Under the present law the Commission prepares estimates of its financial needs and submits them to the Bureau of the Budget. It is the duty of that Bureau to inform itself as to the Commission's work and needs, so that it can pass upon these estimates. After so doing, the Bureau reports to the President, who in turn submits to Congress the appropriation estimate which he approves for the Commission. The latter presents no independent views to Congress, except as they are sought by the congressional committees. Under the provisions of S. 2700, the Commission could be deprived of the opportunity even of presenting initial estimates of its needs to the Bureau of the Budget. In our judgment this matter is adequately and properly covered by existing law. The Commission should certainly have an initial right to prepare estimates of its appropriation needs, for no other body can possibly be as well informed on the subject; and we can see no reason for any intermediary in this matter between the Commission and the Bureau of the Budget. The result could only be a duplication of work and an increase in

expense.

The next item is "the appointment of personnel and maintenance of personnel records." Except for a few key positions and the Commissioners' personal secretaries, the entire staff of the Commission is subject to civil-service regulations. Those regulations, however, properly allow the appointing body some latitude in making its selections, and we have no doubt that they will continue to do so. The Commission exercises this latitude wholly without regard to political considerations and in an endeavor to obtain the best men available for the work. If the power to appoint is transferred to some other agency, the latter is not likely to be another independent establishment but rather an agency which is not of a nonpartisan and nonpolitical character and which cannot be as well informed of our personnel needs as is the Commission. Such a possible transfer seems to us wholly inconsistent with sound principles of administration and public policy. The same may be said of "personnel records." These records record, among other things, conduct and efficiency of service, and are essential in governing promotions. Unless the personnel itself is transferred to some other agency, the Commission is obviously the proper body to keep and maintain such records. The next item is the "procurement of materials, supplies, and equipment." The Commission now determines, within the limits of its appropriation, what is necessary in this respect, and no other body could possibly be as well informed on the subject. In ordering materials and supplies, however, the Commission must order from the list prepared by the Procurement Division of the Treasury Department, except in the rare instances where what it needs is not on that list, in which event it must seek and be governed by competitive bids. We do not believe that anything could be gained, either in the saving of expense or otherwise, by changing this present system.

The next item is the "accounting for public funds." Disbursements are now made by the Treasury Department, but the Commission maintains a small force to keep the accounting record of its operations under the system prescribed by the General Accounting Office. There is no better place to make this record than on the spot. We know of nothing that could be gained by changing the present system.

The final specific item is the "rental of quarters." Assignments of space to the Commission in Federal buildings are now made by other agencies. If quarters are necessary outside of Washington, the Commission must ascertain whether space is available in such buildings. If not, it may obtain space in private buildings by competitive bids and under the system prescribed by the General Accounting Office. It does not appear that anything could be gained by changing

this method.

Summing up our comments on Title I-Reorganization, so far as it directly concerns the Commission, its provisions are, in our judgment, indefinite and uncertain and threaten results which would impair the character and organization of the Commission and the efficient, effective, and nonpolitical performance of its functions. We do not oppose in any way any change in the organization of the Government, including the Commission, which will enable public work to be done better or at less expense. We would welcome and gladly assist in any examination of the Commission's affairs which Congress may authorize with that end in view, but we do not feel that any need has been shown, so far as the Commission is concerned, for any blanket grant of authority to readjust its affairs, such as is proposed in S. 2700.

TITLE II. CIVIL SERVICE AND CLASSIFICATION

The provisions of section 203 are not entirely clear to us. Subsection (a) apparently relates solely to offices or positions "to which an appointment is authorized to be made by the President alone" but which are under the jurisdiction of an executive department" independent establishment or independent agency. The only positions which may be within this description and which are under the jurisdiction of the Commission are the positions of chief inspector and two assistant chief inspectors of locomotive boilers under the Boiler Inspection Act. These officers are now appointed by the President, by and with the advice and consent of the Senate. Whether or not such appointment, in view of the participation of the Senate, is to be regarded as "by the President alone" we are unable to say.

Subsection (a) provides that offices and positions within the description are hereafter to be "filled by appointment without term by the head of the executive department, independent establishment, or independent agency in or under the jurisdiction of which such office or position is located, except (1) any office or position which the President finds is policy-determining in character, and (2) any office or position of head of any bureau, division, service or other similar agency which is in or under the jurisdiction or control of and is directly responsible to the head of an executive department, independent establishment or independent agency."

Subsection (b) is as follows:

(b) Hereafter the President, by and with the advice and consent of the Senate, shall make appointments (1) to fill any vacancy in any office or position of head of any bureau, division, service, or other similar agency of the type referred to in clause (2) of subsection (a) of this section, and (2) to fill any vacancy in any office or position which the President finds is policy-determining in character.

Our understanding of clause (1) in the above, although the language is susceptible of a different construction, is that it covers only officers or positions within the description of clause (2) of subsection (a) and to which appointments are now authorized to be made by the President alone. So construed, our only comment is that we believe it to be sound administrative policy that all positions which are under the jurisdiction of and directly responsible to the head of an independent establishment, like the Commission, should be selected and appointed by such head. Those who are given responsibility for the performance of duties should be allowed to select, subject to applicable civil-service regulations, the men through whom the duties must be performed.

Clause (2) of subsection (b), however, presents greater difficulties, for the reference to "any office or position which the President finds is policy-determining in character" is not qualified, as in the case of clause (1), by reference to the provisions of subsection (a). It is by no means clear, therefore, that clause (2) would be confined in its application to offices or positions to which appointments are now authorized to be made by the President alone. If not so confined, we believe that clause (2) is not consistent with sound public policy.

In our opinion, none of the work of the Commission is "policy-determining in character.' As the Supreme Court said of the Federal Trade Commission in Humphrey's Executor v. U. S., supra: "It is charged with the enforcement of no policy except the policy of the law." That is equally true of the Interstate Commerce Commission. The policies which it applies are fixed by Congress in the statute, and the Commission fixes or determines none on its own account.

While this is our view of our duties, however, it is to be noted that the provisions of clause (2) of subsection (b), above quoted, make the President the sole judge of what offices or positions are "policy-determining in character", and our views (which reflect those of the Supreme Court referred to above) in regard to this matter may not be entertained by the President. In the report of his Committee on "Reorganization of the Executive Departments" (S. Doc. 8, 75th Cong., 1st sess.), which the President transmitted to the Congress with his general approval, appears the following, on page 67, with reference to the "independent regulatory commissions":

There is a conflict of principle involved in their make-up and functions. They suffer from an internal inconsistency, an unsoundness of basic theory. This is because they are vested with duties of administration and policy determination with respect to which they ought to be clearly and effectively responsible to the President, and at the same time they are given important judicial work in the doing of which they ought to be wholly independent of Executive control. (Italics supplied.)

It is quite possible, therefore, that various offices and positions under the jurisdiction of the Commission might be found by a President to be "policydetermining in character", in which event the selection and appointment of the men to fill these positions would be taken out of the hands of the Commission. For the reasons above stated, we believe that such a result would not be consistent with sound public policy and the effective performance of the Commission's duties.

After careful consideration of S. 2700, and for the reasons we have indicated, we respectfully recommend that the provisions of Title I-Reorganization be made inapplicable to the Interstate Commerce Commission, and likewise the provisions of Title II-Civil Service and classification, insofar as they have to do with appointments to offices or positions under the jurisdiction of the Commission.

Herewith we are sending you sufficient copies of this communication for the use of each member of your select committee.

Sincerely yours,

CARROLL MILLER, Chairman.

STATEMENT OF JOSEPH B. EASTMAN, MEMBER, INTERSTATE COMMERCE COMMISSION

The CHAIRMAN. Mr. Eastman, we would be glad to have you make any statement in addition to that letter which you desire to make.

Mr. EASTMAN. My name is Joseph B. Eastman. I am a member of the Interstate Commerce Commission, chairman of its legislative committee. I shall discuss S. 2700 insofar as it affects the Interstate Commerce Commission and shall not undertake to deal with it in other respects.

The Chairman of the Commission also received a request from the committee to appear here this morning. Unfortunately he is away on his vacation, but his letter you have put in the record, and I shall follow much the same line of thought as is expressed in that letter.

I might say a word at the outset in regard to my previous experience. I became a member of the Public Service Commission of Massachusetts in 1914, and of the Interstate Commerce Commission in 1919. In the State service I served in the administrations of Governor Walsh, Governor McCall, and Governor Coolidge, and in the national service in the administrations of President Wilson, President Harding, President Coolidge, President Hoover, and President Roosevelt. For that reason I think I am in a position to express views on this bill not from the standpoint of this administration alone but from the standpoint of administrations in the past, also, and of possible administrations in the future.

In that connection, it happens that in 1927 I addressed a meeting of the American Political Science Association on the subject of "The Place of the Independent Commission in the Federal Government.” That was during President Coolidge's administration, and there was then talk about making the independent establishments part of the administration, as they expressed it.

If I may, I would be glad if this paper, which I have just alluded to, could be incorporated at the end of my remarks, because it is along the same lines of thought as I propose to express this morning. The CHAIRMAN. All right, sir, we will incorporate it in the record. Mr. EASTMAN. I have read the report of the President's Committee on Administrative Management in the Government of the United States with a great deal of sympathy, and I am convinced that the commission had no sinister purpose whatsoever in its recommendations.

It was endeavoring to promote efficiency in the public administration, and I do not think that I have any greater interest in life than that very thing. However, due to the magnitude of the task and the short time in which they had to accomplish it, and the lack of intimate knowledge and experience with such an establishment as the Interstate Commerce Commission, I think that they made, in that report, certain ill-advised and dangerous recommendations as to the Interstate Commerce Commission, and the same is true, although in a somewhat lesser degree, of S. 2700.

The Interstate Commerce Commission has been a source of worriment to those who study it in the abstract, as contrasted with those who deal with it practically. That comes about from the fact that it combines certain legislative, executive, and judicial functions. As a matter of fact, it is an administrative tribunal, developed gradually over a period of 50 years, in the light of experience and to meet demonstrated needs as they arose. It is, in fact, an illustration of what we have heard a great deal about in the recent past, in other words, a practical interpretation of the Constitution to meet new conditions which were unforeseen by the founding fathers.

I have here a quotation from the address of Chief Justice Taft at the memorial services for Chief Justice White, which illustrates the point, which I will not read, but which I should like to have incorporated in the record at this point.

(The extract referred to is as follows:)

EXTRACT FROM ADDRESS OF CHIEF JUSTICE TAFT AT MEMORIAL SERVICES FOR CHIEF JUSTICE WHITE

(257 U. S. XXV-XXVI)

The capital importance which our railroad system has come to have in the welfare of this country made the judicial construction of the Interstate Commerce Act of critical moment. It is not too much to say that Chief Justice White in construing the measure and its great amendments has had more to do with placing this vital part of our practical Government on a useful basis than any other judge. His opinions in the case of the Texas & Pacific Railway Co. v. The Abilene Cotton Oil Co., and the cases which followed it, are models of clear and satisfactory reasoning which gave to the people, to State legislatures, to Congress, and the courts a much-needed knowledge of the practical functions the Commerce Commission was to discharge, and of how they were to be reconciled to existing governmental machinery, for the vindication of the rights of the public in respect to national transportation. They are a conspicuous instance of his unusual and remarkable power and facility in statesmanlike interpretation of statute law.

The Interstate Commerce Commission was authorized to exercise powers the conferring of which by Congress would have been, perhaps, thought in the earlier years of the Republic to violate the rule that no legislative power can be delegated. But the inevitable progress and exigencies of government and the utter inability of Congress to give the time and attention indispensable to the exercise of these powers in detail forced the modification of the rule. Similar necessity caused Congress to create other bodies with analogous relations to the existing legislative, executive, and judicial machinery of the Federal Government, and these in due course came under the examination of this Court. Here was a new field of administrative law which needed a knowledge of government and an experienced understanding of our institutions safely to define and declare. The pioneer work of Chief Justice White in this field entitles him to the gratitude of his countrymen.

Mr. EASTMAN. Now, to make clear our objections to S. 2700 it is necessary to have certain points in mind in regard to the Commission, as to which there is considerable misunderstanding, I think, and confusion of thought, and I want to recall some of those matters to your recollection.

The Commission is, primarily, an arm of Congress. The creation of the Commission arose out of the necessities of the Congress. It was faced with the need of dealing with an extensive and very complex field of legislation which it could not deal with in detail, and for that reason it created the Commission as an agency to apply certain general rules of law which the Congress established. In other words, the Commission was to apply these rules to concrete situations as they arose. An illustration, of course, is the prescription of railroad rates for the future which has always been regarded as a legislative function. State legislatures have done it directly in the past, but when it came to interstate rates it was wholly impractical for Congress to undertake that, and therefore it laid down the rules which were to govern rates and created the Commission to apply those rules. That is true of the great bulk of the Commission's work. It is legislative in nature. It applies to the issuance of certificates of convenience and necessity, control of consolidations and other forms of unification, regulation of security issues, regulation of car supply and service, safety devices, accounting, and other matters. In other words, the great bulk of the duties of the Commission are legislative, or, as it is often expressed, quasi-legislative, or sublegislative.

Now, Congress realized that it was giving a tremendous power to the Commission when it created it for that purpose, and for that reason felt it necessary to protect the exercise of that power against abuse, in order that there might be scrupulous regard for the rights of all concerned, some stability and continuity of policy, and freedom from political influence.

To secure that safeguard against abuse it did three things: It required, first, that the Commission base its action, for the most part, on records openly and publicly made at hearings where everybody concerned would have the right to be heard. In other words, it required the Commission to proceed after the manner of a court. That means that while the function which it is performing is quasilegislative, the procedure which is followed is quasi-judicial.

The second thing which it did was to make the Commission bipartisan and, hence, a nonpartisan and nonpolitical body.

I might say that in my 18 years' experience on the Commission, although its membership represents the two political parties, I have never known it to divide on any question on political lines. Furthermore, in making its appointments, I have never known it to inquire either as to the politics or the religion of any of its appointees.

The third thing the Congress did, in order to assure some stability and continuity of policy, was to give the Commissioners rather long terms of office, and to stagger those terms so that no new administration coming in could make a clean sweep and overturn the entire institution.

Now, in my experience, those three things are, by far, the most important characteristics of the Commission, and it is those that have been threatened in the recommendations of the President's committee, and are, we believe, threatened in Senate 2700, in its present form. In the report of the President's committee there appeared this passage. They say:

In the first place, governmental powers of great importance are being exercised under conditions of virtual irresponsibility. We speak of the "independent" regulatory commissions. It would be more accurate to call them the "irresponsible" regulatory commissions, for they are areas of unaccountability.