cases, from filing of petition to final Board decision. Thus, an employer and a trade-union who are genuinely anxious to reach agreement may be delayed for this period if a rival union contests the bargaining agency.

CAUSES OF DELAY

The National Labor Relations Board is aware of the problem, and is making herculean efforts to speed its decisional processes. While the passage of time may ease the problem, as the Board work becomes more routine, no real improvement can be anticipated on this account in the near future. Procedural delay and its attendant disadvantages are likely to persist during the next few years, given continuance of the present allocation of functions.

The chief bottleneck is the Board, rather than the General Counsel or any of his operational divisions. But this is not due to inefficiency or dilatoriness of the members of the Board. On the contrary, they work exceedingly hard, and now use panels of three to speed the handling of the case load. The volume of their output compares favorably with that of any other regulatory agency.

The fault lies in the system itself. A larger volume of work is generated than can be disposed of by the Board in a reasonable manner. It is estimated that merely in order to remain current, without making provision for amortization of the large backlog of cases that exists, the Board must render approximately 25 unfair labor practice decisions and 94 representation decisions per month in contested cases. In addition there are stipulated cases, which require some Board attention: Union shop election matters; questions of general policy; and administrative responsibilities.

This work load must be viewed against the background of the Board's obligations. As yet there have been few substantive interpretations of the Labor-Management Relations Act, although many questions have been raised. The Board must have time to deliberate in deciding these questions, which may be of crucial importance for the future of American labor relations.

POSSIBLE METHODS OF CORRECTION

Our staff makes the following proposals toward a solution of the procedural delay problem:

1. Decisions rendered by trial examiners at the conclusion of unfair labor practice trials should become final orders of the Board, unless within a specified period they are certified to the Board for review, either by the issuing trial examiner or by a panel of the Board.

2. Regional directors should be authorized to order prehearing elections, and to direct the holding of posthearing elections after ruling upon disputed issues in representation cases. Appeal to the

Board from such rulings would be permitted only with the consent of the regional director or upon the Board's own motion.

The rationale of this scheme lies in the possible diminution of the Board's work load through its control of the case intake. Presumably, on routine matters the decision of the trial examiner and regional director would be final. Only novel and significant issues would be presented to the Board itself.

These proposals were submitted for comment to a number of individuals conversant with the operations of the National Labor Relations Board. In general, they were agreed upon the necessity of an immediate attack upon the problem and some favored a trial of the proposals. Others stated various objections to them, but the alternative schemes suggested also have drawbacks of their own.

It was commonly suggested, for example, that an increase in the membership of the Board to 7, 9, or 11 would permit expansion of the panel system and thus lead to increased output. This fails to take into account the serious risk that a larger Board would probably require more time to decide the important cases in which full Board action proved necessary. Another proposal was for final decision of cases by single Board members where the effect is to affirm the trial examiner; reversal would presumably require submission to the full Board.

In our opinion, the proposals of our staff merit serious consideration, despite some disadvantages. In any event, we are convinced that some experimentation with them or alternative devices is preferable to accepting the indefinite continuation of procedual delay.

D. The General Counsel

Another problem that has caused us considerable concern is the position of the General Counsel. As indicated above, he is a prosecutor, an administrator, a policy maker. The incumbent, Mr. Robert Denham, has noted that his powers "are broad and absolute and his authority final to an outstanding degree seldom accorded a single officer in a peacetime agency."

The existence of such an office, independent both of the Federal departmental structure and of the Board, marks a departure from previous administrative practice. If permitted to set a pattern for future Government organization, it may lead to a diffusion of responsibility.

Such an official is in a peculiarly exposed position. In view of the wide powers of the office, it is inevitably subject to heavy pressure

1 Remarks of Robert N. Denham before the labor relations section of the American Bar Association, Cleveland, September 23, 1947.

from all sides, and lacks the protection of either a multiheaded agency or an executive department in resisting such pressures. Experience during the first year indicates a tendency to develop close working relations with the joint congressional committee established by the act. To the extent that this has involved advice and suggestions with respect to interpretation of the act and its application to specific situations, the practice seems doubtful and likely to blur the desirable separation between the legislature and administration.

But the administrative position of the General Counsel is also anomalous. Thus the field offices under his supervision are engaged partly in representation work which is the direct responsibility of the Board, and partly in investigating, issuing, and prosecuting complaints, on which the General Counsel has final authority. Under the act, the Board has the authority to appoint the regional directors and other employees. In part, as has been seen, the work of the General Counsel is essentially prosecution of violations of specific offenses under the act. But insofar as his actions establish policy, they are of the kind frequently assigned to an independent commission.

The unusual position of the General Counsel has given rise to several internal administrative problems. One is significant enough to be noted here: In unfair labor practice cases, regional directors issue complaints, though only with the approval of the General Counsel in some types of cases. The finality of refusal to issue a complaint has led to demands for an appeal; and it has been further urged that an appeal to the same unit in the counsel's office whose advice was followed in the original refusal is illusory, and that the appeal should be to an independent body. This problem high lights the nature of the authority the General Counsel is exercising.

Our conclusion is that the present position of the General Counsel is an unstable one. Various proposals have been made for integrating the position more securely into the Government structure. Some have suggested assigning him to the Department of Labor or of Justice, but each has serious draw-backs as the preceding discussion of his functions should indicate.

Our staff recommends the creation, by executive order, of a council of labor under the chairmanship of the Secretary of Labor, and including the General Counsel and other Federal officials concerned with labor problems. The function of the Council would be to coordinate Federal labor policy and to advise the President on appropriate action. This represents a compromise between the present independent status of the General Counsel and his subordination to a department head. Others have strongly urged that the office should again be placed under the Board. To this the objection is made that the prosecuting functions should be separate from the hearing of complaints. But as has already been indicated, only in part are his present duties genuinely

prosecution; some parts are administrative and parts are a species of rule or policy making. It may be that the administrative and policymaking functions could be subordinated more clearly to the Board's control while still maintaining an adequate separation of the truly prosecuting activities.

E. Filing Requirements

There is one noncontroversial matter in which it should be possible to effect a saving both to the Government and to party litigants with little difficulty. The statute now requires that the data specified in sections 9 (f) and (g), pertaining to union organization and finances, must be filed with the Labor Department, while the non-Communist affidavits required by section 9 (h) must be filed directly with the National Labor Relations Board. There appears to be no sound reason for not processing the information in one agency. Whether that agency be the Department of Labor or the National Labor Relations Board seems less important than that the consolidation be effectuated.

F. Conclusions

The Labor-Management Relations Act recognized that only through continuing scrutiny of the act in operation could its defects be eliminated and the basic purpose of promoting harmonious industrial relations be prompted. The act established a Joint Committee on Labor-Management Relations with its object the study of the administration and operation of existing Federal laws relating to labor relations.

We recommend that any review of the act take account of the factors to which the preceding discussion directs attention. We would especially emphasize the following:

1. No stable administrative structure will be feasible unless the framework of policy is basically acceptable to labor, management, and the public.

2. In devising the administrative structure, the character of the functions being performed should be carefully analyzed to avoid some of the present complexity.

3. A primary objective should be to reduce sharply the procedural delay inherent in the present structure and methods of operation.

4. The Office of General Counsel should not be left independent of both the Board and the executive departments but should be integrated more closely into one or the other according to the functions to be performed.

Chapter XIV

SECURITIES AND EXCHANGE COMMISSION

The Securities and Exchange Commission, created in 1934, is composed of five members, appointed for staggered terms of 5 years. Not more than three members may belong to the same political party. The act makes no provision for a Chairman.

The Commission was first assigned the administration of the Securities Act of 1933 (transferred from Federal Trade Commission) and the Securities Exchange Act of 1934. Thereafter its functions. were expanded by the Public Utility Holding Company Act (1935), the Trust Indenture Act (1939), the Investment Company Act (1940), the Investment Advisors Act (1940), and chapter X of the Bankruptcy Act.

A. Functions of the Commission

The main duties of the Commission may be briefly summarized as follows:

REGISTRATION OF SECURITIES

Before a security is publicly offered by mail or in interstate commerce, there must be filed with the Commission and become effective a registration statement disclosing material information relative to the security. The registration becomes effective 20 days from the filing of the last amendment unless the Commission (1) suspends the statement by issuing a refusal or stop order or (2) shortens the waiting period by granting acceleration.

Refusal or stop orders are seldom used except for wilful inaccuracy. Instead, after the staff examines the statement, the Commission, by letter, notifies the registrant of deficiencies, giving him opportunity to amend; and amendments are filed in almost all cases. Usually, after all questions are settled, the registrant files a final amendment stating the offering price and underwriting expenses, and the Commission may permit sales the next day under its authority to accelerate. Thus this power is most important in minimizing the risks of market fluctuation.

Debt securities offered to the public must not only satisfy these disclosure requirements but must also comply with the Trust Inden