man, To place control over the staff in the hands of the Chairman is to make him all-powerful and thus virtually make the other Commissioners figureheads. The Chairman, of course, is appointed directly by the President. These plans therefore, would be a substantial step toward the elimination of the bipartisan and nonpolitical character intended for these Commissions. With respect to the Federal Trade Commission, the most important objection to this plan results from the internal organization of that agency. There are now four virtually independent divisions in the Trade Commission. The Bureau of Investigation investigates complaints and decides what businesses should be proceeded against. It is their obligation to decide what complaints should be disregarded and what complaints should culminate in litigation. The prosecuting staff has the obligation of prosecuting the complaints presented by the investigating division. The trial examiners are intended to be autonomous, impartial men whose job is to decide (initially) the innocence or guilt of the accused. The trial examiner does not assume guilt merely because the investigating agency has issued a complaint. He is required to make an independent and honest appraisal of the facts. Ultimately the Commissioners themselves theoretically review the trial examiner's report, but this is actually done for them by the special legal assistants. The Administrative Procedure Act was intended to separate these functions in order to insure a fair and impartial trial to the accused in Commission proceedings. These divisions cannot remain independent if they are all under the exclusive supervision of the Chairman. To place the Chairman in full charge of all divisions is to bring them under a central authority. If the Chairman approves the filing of a complaint by the investigators under his control, then presumably he approves their prosecution by the prosecuting agency, intends their conviction by the trial examiner, and wants the examiner's report approved by his special legal assistants. Because the other four Commissioners are deprived of staffs to independently inquire into the cases before the Commission, they will have little alternative but to follow the pattern set for them by the staff. So far as the Trade Commission is concerned, the important thing is that most of its cases are adversary proceedings. The Commission does not concern itself with regulatory proceedings such as the issuance of licenses to do acts prospectively. This Commission's activities relate almost wholly to the legality of acts already committed. In such case, the defendants are entitled to a fair trial in which the same person is not judge, jury, prosecutor, and investigator. It also requires that the same man not have exclusive control over the judge, jury, prosecutor, and investigators. These are not cases where someone applies for a license to operate a radio station, or where an application is made to reduce freight rates in the future, or where a permit is sought to construct a pipe line in interstate commerce. FTC cases involve charges of conspiracy to fix prices, deceptive advertising practices, and fraudulent sales schemes. The people would certainly not countenance a law which gave one man the right to investigate, prosecute, and to judge the legality of such practices, and yet by indirection this is precisely what this and the other reorganization plans would tend to do. Mr. Chairman, and members of the committee, I am most grateful for your courteous attention and kind indulgence. I feel strongly about these reorganization plans; I trust that this hearing will convince you that they are basically unwise and even repugnant to our concept of tripartite government. I hope you will see fit to approve by a unanimous vote Senate Resolutions 253, 254, 255, and 256. The CHAIRMAN. Senator Johnson, do you regard the issue in the four plans as being the same? Senator JOHNSON. Yes, I regard it as being identical in principle. The CHAIRMAN. Identical in principle in the four plans? Senator JOHNSON. It will have approximately the same effect. The CHAIRMAN. May I ask whether the Committee on Interstate and Foreign Commerce has taken any official action by the adoption of a motion with respect to these plans, whether the committee feels they should be disapproved, or do you speak for the full committee? Senator JOHNSON. We discussed them in committee and the sentiment in the committee seemed to be generally in favor of my position, but we did not take official action with respect to them in the committee. There was minority opposition to my position; at least there was expressed in the committee by one or two members, the thought that they wanted to study them more; they did not want to oppose the Hoover Commission's program unless the evidence was pretty overwhelming; that it would not be wholesome and good to do so; and they wanted further time to study it. So they have not at the present time taken any official action. The CHAIRMAN. I only inquire because if they had we would want that to appear in the record. This committee, of course, has jurisdiction of the reorganization, and the plans are referred to this committee for hearing and for reports and recommendations on them. Still, where another committee of the Senate has jurisdiction over that agency which is involved in the reorganization plan, why, this committee is always glad to have any expression from the committee if it cares to take such action. Senator JOHNSON. Well, there may be an official expression by the committee with respect to these resolutions shortly. I am not sure. But at the present time there is no official expression from the committee. The CHAIRMAN. Any questions? Senator O'CONOR. I should like to ask Senator Johnson one question. Senator Johnson, in connection with the point that the Reorganization Plan No. 7, for instance, if put into effect would operate to make the ICC, and of course similarly in the other instances, a oneman Commission, the answer is given by some advocates of the Hoover Commission recommendations that the particular provision in subsection b (1) would prevent that. In other words, this states: And in carrying out their functions the Chairmen shall be governed by general policies of the Commission and by such regulatory decisions, findings, and determinations as the Commission may by law be authorized to make. I wonder if you will give us the benefit of your view as to whether or not you think that is a safeguard, or whether or not that would operate to prevent the Commission from being a one-man Commission, because the Chairman, if that is carried out, would be subject to the determinations of the Commission. Senator JOHNSON. No; I do not think that is a safeguard at all. In theory it would sound plausible, but in actual practice it would have little, if any, effect at all, because the Chairman is given almost complete control over the staff, and the staff, as we know, play a great part in everything, in all of the decisions that the Commission makes. It must be that way. They have such a tremendous amount of detail work to do that they have to rely on the staff. The Commission cannot possibly be familiar with all the many details which come before the Commission, and so the Chairman would control the staff and the staff to a large extent would control the Commission. That is the way it would work actually. The staff would not be beholden at all to the other Commissioners, they would be completely independent of them. All of them, even the Commissioners, if this reorganization plan goes into effect, would look to the President, all of them, for the policy of the Commission. Senator O'CONOR. Thank you, Senator. Senator BENTON. I should like to pursue this point of Senator O'Conor's just a bit further if I may, Senator Johnson. Out of your long experience with these Commissions, have there been Chairmen who just by the force of their personality or ability or tenure have achieved for all practical purposes what might be called general control over staff appointments? We assumingly want able men as Chairmen, the best men we can get as Chairmen. Senator JOHNSON. I know of no such experience in the Commissions. Of course, a strong Chairman has much greater control over the Commission staff and over the Commission itself than a weaker Chairman would have, and we have had some excellent Chairmen of the Commissions and some Chairmen who perhaps did not measure up. A Chairman always can make himself felt and his influence felt. Senator BENTON. In the selection of the best men we can get for the Federal Government, would not our dream be that we would select Chairmen even under the present system who by the force of their leadership and capacity would develop a very considerable measure of authority-if they had tenure as well, if they stayed in the job as well-over the selection and direction of the staff? Senator JOHNSON. Well, I would not want to argue against a good well-qualified Chairman versus a Chairman who was not well qualified, but I see no insurance in this plan, and I see no assurance in my experience in Government, that because we let the President name the Chairman we are going to have the best Chairmen. I think that politics might have a great deal to do with the selection of the Chairman if the Chief Executive is given the power of naming the Chairman. And I am not referring to this administration or to any particular administration, I am referring to the executive department. I think it is very bad practice for us, as Members of Congress, to turn over these legislative arms of Congress to the executive department. I think it is entirely contrary to the concept of our Government that the founding fathers had. Now the only reason we have these Commissions is because Congress cannot attend to all the great details that come before the Commissions. We simply cannot do it. We do not have time, we hardly have time to attend to our own work, the other work that is before us. And so we create these Commissions and let them handle the great mountain of detail which comes before the Commissions. Senator BENTON. Is it not true for all practical purposes that the President today does appoint the Chairmen? I was once approached to be the Chairman of one of these Commissions, and there seemed to be no doubt in the minds of those who approached me that the President had the power to name the Chairman. Senator JOHNSON. Unfortunately, yes. And I say "unfortunately" because I think it is unfortunate that the President does name the members of the Commissions now. I would like to see the Commissions named by the House of Representatives and confirmed by the Senate. I think that that would be a much better provision than the present provision. But the President names the members of the Commission, and the Senate confirms their nomination. He nominates them and the Senate confirms their nomination. That is the present system. I think that Congress ought to retain even more power over the Commissions than they do at the present time. Senator BENTON. Thank you. The CHAIRMAN. Senator Smith, any questions? The CHAIRMAN. Senator Schoeppel? Senator SCHOEPPEL. Senator Johnson, I note you have touched on this, namely, the President under this reorganization plan naming not only the Chairman but giving that one man a lot of power, a lot of authority over personnel, staff, and everyone else. I served as the chairman of a State regulatory commission consisting of three members. I will say to you quite frankly I doubt whether the other two members that I served with would have been willing to serve with me-and they were good men if they knew that I controlled the entire personnel of the Kansas Corporation Commission or if the personnel would have been beholden to me as chairman. And I do not want to project my personal experience into this matter except to this extent. Do you think that it would be conducive, if this plan goes through, to getting the best men possible who would feel they were playing second or third or fourth fiddle in all of these important agencies if one man was placed out in front and given so much authority? Senator JOHNSON. No; I do not. I think your Commissions would be made up of men of inferior qualifications, if that were done. I do not see how it could be otherwise. I do not see how any Commissioner with very much self-respect could serve on a Commission. I do not see how men who want to serve their Government well could serve on a Commission under those circumstances, with the Chairman appointing the whole staff, taking charge of the whole administrative side of the Commission's work, and the Commissioners themselves just sitting there as yes men. I think it would absolutely and completely destroy the Commissions as democratic agencies. Senator SCHOEPPEL. I take it, from listening to your testimony and your explanations here, that you have digressed from your prepared speech, and that one of your big fears, coupled with the destructive change that would be effected by taking the Commission out and away from the legislative branch, instead of being a quasi-judicial arm or quasi-legislative arm or administrative arm of the Congress, it would be under the influence of the executive branch of the Executive? Senator JOHNSON. Yes; that is my fear that if the Hoover plan goes through with respect to these Commissions that the Congress will completely lose all of their influence with these Commissions and they will become in fact agencies of the executive department; and that they will carry out the will one way or the other of the Executive; the policy will be determined by him; it will be dictated by him if he desires to dictate it; and the Commission will follow him and become yes men to the Executive instead of functioning as they now function as the arms of Congress. Senator SCHOEPPEL. Those are all the questions I have. The CHAIRMAN. We are very glad to have with us this morning Senator Aiken, who served on the Reorganization Commission and who is former chairman of this committee. Senator Aiken, we should be very happy to have you ask any questions if you desire to. Senator AIKEN. Mr. Chairman, I am glad to be back sitting with you here again as I did so long, but I have come in simply this morning to hear arguments for and against this resolution in order to help me reach a decision of my own. 65954-50-3 The CHAIRMAN. Well, you feel free, Senator, at any time to ask any questions you wish. Senator AIKEN. I will feel free, Senator McClellan, to ask a question at any time it occurs to me. Senator JOHNSON. I know because of Senator Aiken's vast experience in State government and his experience here as a Senator that his counsel will be very valuable in this matter. But I want to call the attention of this committee once more to what would happen to the committees of Congress if the President were to name the chairman of each of our committees and if Congress were to place the staffs of the committees directly under the chairman who was named by the President of the United States. I just wonder what would happen to our committees then. Senator AIKEN. Mr. Chairman, as I understand it, Senator Johnson feels that the approval of these reorganization plans would make these regulatory Commissions more responsive to the executive branch of Government than to the legislative. That is the principal basis of your opposition? Senator JOHNSON. Yes; that is the basis of it, and, beyond that, that the Commissions themselves organically and basically should be the arms of Congress and not the Executive because they exercise quasi-legislative and quasi-judicial powers and functions. Senator AIKEN. And yet the set-up as we would have it under the present plan would be more like the State commission set-ups, would it not, the public service commissions of the States? Senator JOHNSON. It might be like some States. Senator AIKEN. Where the commission is appointed by the Governor with the approval of the Senate of the State Legislature, and then the Governor designates the chairmen of these commissions. Senator JOHNSON. Yes; that may be true in some States. But the thing that is so important in this case is not merely the appointment of the chairman but the fact that the chairman of the commission is given complete control over the administration of the commission. My contention is that that authority and that power gives the chairman complete control over the commission, not theoretically but practically. Thank you, Mr. Chairman. The CHAIRMAN. Thank you, Senator Johnson. Mr. Lawton, will you come forward, please, sir. Do you have a prepared statement? Mr. LAWTON. Yes, sir. The CHAIRMAN. Do you wish to read it? Mr. LAWTON. I would like to; yes, sir. The CHAIRMAN. All right, you may proceed. STATEMENT OF FREDERICK J. LAWTON, DIRECTOR OF THE BUREAU OF THE BUDGET Mr. LAWTON. Mr. Chairman and gentlemen of the committee, reorganization Plans Nos. 7, 8, 9, and 11 of 1950 are designed to strengthen the management of four regulatory commissions-the Interstate Commerce Commission, the Federal Trade Commission, the Federal Power. Commission, and the Federal Communications Commission. The sole objective of these plans is improved organization and administration |