we have the Patent Commissioner in that category? And why should the Inland Waterways or Civil Aeronautics Board be exempted, which certainly are no more judicial in their functions than the Patent Office?

Mr. HOLIFIELD. Well, we can take those up one at a time, but for the time being, I want the record to show that the lining up of authority from the top of the Department to the bottom, as far as the administrative authority is concerned, and also functional authority, under the law, within the limitations of the law, of course, applying to the duties of subordinates, is a matter which is used by private industry; and that is what we are trying to do, not only just with this Department but with quite a number of departments where there has been conflict of authority because of special independent status of some of the subordinates in certain ways.

Mr. LANHAM. We take no exception to this plan other than with reference to the Patent Office, Mr. Chairman, because we think the other branches are administrative. We think this is judicial and quasi-judicial in its character.

Mr. HOLIFIELD. No; these plans are plans that apply to agencies which are administrative, quasi-judicial, and quasi-legislative all of these plans. But there is a difference between an agency being independent in regard to the exercise of its quasi-judicial and quasi-legislative power, under the law, and being independent from the standpoint of administrative responsibility. And it is the administrative responsibilty that we are tryng to place.

Mr. LANHAM. May I ask, in that connection, then, Mr. Chairman: Why exempt, for instance, Inland Waterways and the others enumerated there, and not exempt the Patent Office?

Mr. HOLIFIELD. We will get to that question just a little bit later, and we will have some testimony on that point. But I want to confine myself at the present time to some of the statements which you have made.

The Patent Commissioner and his assistants are today appointed by the President and confirmed by the Senate. That will not be changed. The plan has nothing to do with the appointment of the Patent Commissioner and his assistants. They will continue to be appointed by the President and confirmed by the Senate just the same. You can find nothing in the plan at all that has to do with appointive powers. Therefore, your basic law, which I know you are familiar with, I might read to you at this point. The United States Code, 1946 edition, deals with Patents, Title 35. Section 1 of that title recites that:

There shall be in the Department of Commerce an office known as the Patent Office * *

Section 2 provides that there shall be in the Patent Office a Commissioner of Patents, one First Assistant Commissioner, two Assistant Commissioners, and nine examiners in chief, who shall be appointed by the President, by and with the advice and consent of the Senate. Section 2 goes on to say:

The First Assistant Commissioner and the Assistant Commissioners shall perform such duties pertaining to the Office of Commissioner as may be assigned to them respectively, from time to time, by the Commissioner of Patents. All other officers, clerks, and employees authorized by law for the Office shall be appointed by the Secretary of Commerce upon the nomination of the Commissioner of Patents, in accordance with existing law.

Now, that is not changed. That remains the same, in my understanding.

Section 6 of the title, prescribing duties of the Commissioner, recites as follows:

The Commissioner of Patents, under the direction of the Secretary of Commerce

this is statutory law, I am reading.

shall superintend or perform all duties respecting the granting and issuing of patents directed by law; and he shall have charge of all books, records, papers, models, machines, and other things belonging to the Patent Office. He may, subject to the approval of the Secretary of Commerce, from time to time, establish regulations, not inconsistent with law, for the conduct of proceedings in the Patent Office.

Section 11 authorizes the Commissioner of Patents, subject to the approval of the Secretary of Commerce, to prescribe rules and regulations governing the recognition of agents, attorneys, or other persons representing applicants or other parties before his office.

So you are in error, sir, I believe, honestly in error of course, when you say that this interferes with the appointing power of the President, and when you say that it interferes with the statutory duties set forth by law that the Commissioner of Patents shall continue to discharge. Mr. LANHAM. Well, in that connection, Mr. Chairman, if you will just read the plan itself, section 1:

Except as otherwise provided in subsection (b) of this section, there are hereby transferred to the Secretary of Commerce all functions of all other officers of the Department of Commerce and all functions of all agencies and employees of such Department.

Then, in section 2:

The Secretary of Commerce may from time to time make such provisions as he shall deem appropriate authorizing the performance by any other officer, or by any agency or employee, of the Department of Commerce of any function of the Secretary, including any function transferred to the Secretary by the provisions of this reorganization plan.

Oh, when you consider the ramifications of what could be donethey could even take the money away from the Patent Office and give it to some other agency according to this section 4. The ramifications of what can be done under that plan certainly give me pause, Mr. Chairman.

Mr. HOLIFIELD. I would respectfully suggest that at the present time the Commissioner of Patents is responsible for his functions under law. The transfer of those functions to the Secretary of Commerce does not affect the law under which those functions are performed. It merely changes the line of responsibility for administration from the Commissioner of Patents to the Secretary to the President. At the present time, the Commissioner of Patents, in my understanding, is directly responsible to the President under his appointive powers, of course, for the faithful performance of his functions under direction of law. But the responsibility for compliance with statutory provisions which direct the functions of that office does not change, if I am correctly informed.

Mr. LANHAM. Mr. Chairman, if there be ills in the patent system, in the light of our history and the progress we have made I think we had better bear the ills we have than fly to others that we know not of. And with reference to the Patent Office, in its operation, of course,

some of these gentlemen who are versed in patents and represent patent organizations of the country, can give you much more accurate technical information than I could.

Mr. HOLIFIELD. Thank you very much.

Mr. HOFFMAN. Mr. Chairman, at this point I would like to include in the record, at the close of his testimony, the statement by the Senate Committee on Expenditures in the Executive Departments, page 3758, under date of March 21, what it says across the page with reference to plan No. 5.

Mr. HOLIFIELD. Without objection, it will go in. (The material referred to follows:)

No. 5-DEPARTMENT OF COMMERCE

Provisions: Vests in Secretary of Commerce all functions of all other officers, employees, and offices of Department; (b) authorizes Secretary to delegate functions to any officers, employees or office of Department; (c) establishes an Administrative Assistant Secretary.

Conforms to Hoover Commission's recommendations in part III of Report No. 1 on general management. Partially implements (except for transfers outlined in next column) through vesting of functions in the Secretary, reorganizations outlined in parts I, II, and III of Report No. 10, Department of Commerce and establishes an Administrative Assistant Secretary.

Does not provide for (a) the grouping of all nonregulatory transportation activities in the Department; transfer of (b) business operations of Maritime Commission; (c) motor-carrier safety functions from Interstate Commerce Commission to Department; (d) car service, safety functions, and railroad-consolidation planning from Interstate Commerce Commission to Department; (e) commercial fisheries activities from Department of Interior to Department of Commerce, as Hoover Commission recommended. Also, does not (f) establish Bureau of Civil Aviation to administer Civil Aeronautics Administration; (g) prescribe air safety regulations subject to review by CAB and incorporate National Advisory Committee for Aeronautics; (h) vest in Secretary of Commerce responsibility for the establishment of air, rail, and water transportation route patterns; nor (i) for the initiation of regulatory action when carriers are at variance.

Mr. HOLIFIELD. At this time we are highly honored by having before the committee this morning the Honorable Charles Sawyer, the Secretary of Commerce.

Mr. Sawyer, we will be pleased to have you take the witness chair.

STATEMENT OF HON. CHARLES SAWYER, SECRETARY OF

COMMERCE

Secretary SAWYER. Mr. Chairman and gentlemen, I have here a prepared statement, which I will read with your permission.

Mr. HOFFMAN. When did that come up, Mr. Chairman! When did the statement come up?

Mrs. DAVIS (committee clerk). It came up with the Secretary this morning.

Mr. HOFFMAN. We would like to have those statements as quickly as we can get them, so that we can have a chance to look at them.

Secretary SAWYER. I saw it for the first time myself this morning. I did not hear about this until yesterday afternoon, so I am under the same handicap as my friend, the former Congressman was; and, if the statement did not arrive in time for you to give it prior consideration, we are sorry.

Mr. HOLIFIELD. We do try to get prepared statements to the committee members before the sitting of the committee.

Secretary SAWYER. Yes; I know that.

Mr. HOLIFIELD. And we realize it is not your fault, because of the shortness of notice.

You may proceed, sir.

Secretary SAWYER. I may say, though perhaps it is unnecessary, that we received notice of this meeting yesterday afternoon, and we worked on this statement, and, as I say, I just saw it in final form before I came here.

I appreciate this opportunity which your committee has given me to discuss Reorganization Plan No. 5 of 1950. This plan was transmitted to the Congress by the President on March 13, 1950. It would vest in the Secretary of Commerce the presently scattered responsibilities for all the functions of the officials and constituent agencies of the Department. The plan would permit the Secretary to delegate his functions and to make internal organizational adjustments. The central idea of the plan is to make the Secretary of Commerce responsible in fact as well as in theory for the operations of the Department which he heads. Without reservation, I am convinced sincerely that this plan is entirely sound in terms of both theory and practical operation.

I will not take the time to read this next portion of my statement, and I will not refer to the exceptions, except to say that there were good reasons why the Inland Waterways was excepted. Of course, it is a corporation. Mr. Lanham referred to the CAA. Of course, the CAA is not excepted. The CAB is not within the control of the Secretary of Commerce now, and the obvious desire was that it should remain as it is.

As far as the examiners are concerned, the hearing examiners, they are excepted because they operate in a judicial capacity. At the moment, we do not have any hearing examiners on a full-time basis in the Department of Commerce, but they do in the CAB.

Mr. HOLIFIELD. They operate under the Administrative Procedure Act.

Secretary SAWYER. Yes. Exactly, Mr. Chairman.

During my tenure as Secretary of Commerce, I have had many occasions to consider the nature of my legal responsibilities in connection with the various activities conducted by the Department. It has struck me rather forcefully that I am held responsible to Congress, to the President, and to the people for faithful execution of several functions for which the direct statutory authority is scattered among different bureau officials of the Department. In the light of these practical operating circumstances, I was pleased that the Commission on Organization of the Executive Branch saw fit to give attention to the matter of Department organization. In the light of my personal experience as Secretary, I was subsequently pleased with the insight and soundness of the observations and recommendations of the Commission on Organization.

I will not quote here, inasmuch as it is in the formal statement, extracts from the reports of those committees which, Mr. Chairman, you and the members can read later.

I will then, if I may, go to page 7.

In giving consideration to Reorganization Plan No. 5, it is desirable to have some understanding of the nature and magnitude of the various activities and agencies within the Department of Commerce. It is essential to keep in mind that the plan applies to the entire Depart

ment. The Department was established as such by the act of March 4, 1913, which reorganized the Department of Commerce and Labor, which had been created 10 years earlier. The statutory functions of the Department are to foster, promote, and develop the foreign and domestic commerce, mining, manufacturing, shipping, and fishing industries, and the transportation facilities of the United States. The Department had a total employment of somewhat over 46,000 as of January 1 of this year. In financial support of the Department, the Congress appropriated $672,000,000 in cash and approved an additional $537,000,000 in contract authority.

For purposes of suggesting immediately the size, scope, and range of the Department's functions, I might mention that the Department embraces the following major constituents: Office of the Secretary. which includes the Office of Technical Services; the Civil Aeronautics Administration, the Weather Bureau, the Bureau of the Census, the Bureau of Public Roads, the National Bureau of Standards, the Coast and Geodetic Survey, the Patent Office, the Bureau of Foreign and Domestic Commerce, and the Inland Waterways Corporation. I have brought together certain factual information concerning these 10 agencies. Rather than taking the time of the entire committee in reading this information, I would like to submit for the record at this point a statement which I hope will provide a bird's-eye view of the Department. And that statement, Mr. Chairman, is here, and I will hand it to the stenographer.

Mr. HOLIFIELD. Is that separate from this?

Secretary SAWYER. It is a separate document; yes. It is headed "Constituent agencies and programs of the Department of Commerce." Mr. HOLIFIELD. It will be printed in the record at this point.

Secretary SAWYER. I would like to take the time to read it; but, in view of the pressure of time of the moment, I will leave it with you.. if I may.

(The material referred to follows:)

CONSTITUENT AGENCIES AND PROGRAMS OF THE DEPARTMENT OF COMMERCE

The Office of the Secretary provides central departmental services in the fields of over-all planning, budget, finance; personnel, information, legal counsel, and administrative services. It embraces also an Office of Technical Services which procures and disseminates technical information accruing from Government research laboratories and from postwar intelligence in Germany. For the Office of the Secretary as a whole, the employment as of January 1, 1950, was 661 and the appropriation for 1950 amounted to $1,699,000.

2. The major programs of the Civil Aeronautics Administration are (a) The establishment, maintenance, and operation of aids for the navigation and landing of aircraft, (b) the Administration of the Federal-aid airport program, and (c) the enforcement of established safety regulations and standards. In addition, it is charged with carrying on a number of related activities including programs of developing and service testing new air navigation and landing aids, the operation of the Washington National Airport, the provision of airport advisory services, and the settleemnt of airport damage claims.

The Federal airways system extends over 45,000 miles of routes in the United States and its possessions. Hundreds of radio ranges and various other mechanical and electronic navigational and landing facilities are maintained and operated at all hours of the day. In addition, the CAA operates and staffs on a 24-hourper-day basis 446 aeronautical communication stations, 27 air-route traffic-control centers, and 172 airport traffic-control towers. The total employment as of January 1 numbered 17,785. For fiscal 1950 Congress appropriated roughly $140,000,000 in cash and approved $67,300,000 in contract authority.

3. The Weather Bureau is responsible for observing and reporting weather facts and information for public and private use. In addition, the Bureau pre