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(3) provide for the transfer or other disposition of records, property, personnel, and unexpended balances of appropriations, to the extent necessary to effectuate such termination.

(H. R. 9890, 83d Cong., 2d sess.) A BILL To establish a Federal policy concerning the termination, limitation, or establishment of business

type operations of the Government which may be conducted in competition with private enterprise, and for other purposes

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SHORT TITLE

SECTION 1. This Act may be cited as the “Anti-Government Competition Act”.

DECLARATION OF POLICY Sec. 2. The strength and welfare of this Nation rest upon an economic system in which private enterprises compete freely among themselves with a minimum of direct Government competition. This system produces and distributes the goods and services vital to our national security and essential to the maintenance of an ever-rising standard of living for the American people. When the Government unwarrantedly engages in business-type operations competitive with private enterprise, it tends to destroy initiative on the part of the people and to restrict the normal growth and expansion of private enterprise. It further deprives the people of opportunities for private employment and enterprise. Therefore, it is declared to be the policy of the Congress that the Federal Government shall not engage in business-type operations competitive with private enterprise except where it can be demonstrated that it is necessary for the Government itself to perform such operations in furtherance of national programs and objectives legally established. To the degree that present Government businesstype operations may be carried on in a manner inconsistent with this policy, they should be terminated or limited in accordance with appropriate law, and the Government should avoid such competition. Whenever new Government bus." ness-type operations are proposed to be established, they, likewise, should be measured against this policy and should not be established unless thoroughly consistent with this policy.

INSTRUCTION, RULES, AND REGULATIONS Sec. 3. The President shall, from time to time, issue such instructions, rules, and regulations for the termination, limitation, or establishment of business-type operations in the executive branch of the Government as he may deem appropriate for carrying out the policy declared in section 2 of this Act.

PUBLIC COMPLAINTS OF GOVERNMENT COMPETITION Sec. 4. It shall be the duty of the Secretary of Commerce, acting under the instructions, rules, and regulations issued by the President, to receive from the public and examine specific complaints of Government competition with private enterprise and, where the facts warrant, consult and cooperate with officers of the Government supervising the Government business-type operations complained about in order to suggest, where appropriate, the termination or limitation of Government competition through the utilization of private facilities, products, or services in lieu thereof.

NEW GOVERNMENT BUSINESS-TYPE OPERATIONS Sec. 5. Before establishing any new Government business-type operations which may be competitive with private enterprise or requesting or expending funds for such operations, it shall be the duty of each Government department, agency, establishment, or instrumentality, planning to establish such operations to submit a report to the Director of the Bureau of the Budget, in such form as he may prescribe, describing in detail the proposed new Government business-type operations. It shall be the duty of the Director of the Bureau of the Budget to make a recommendation to the President as to whether such contemplated opera

tions should be established, bearing in mind the policy declared in section 2 of this act: Provided, however, That this section shall not apply to any Government business-type operations being carried on on the effective date of this Act or to any Government business-type operations hereafter specifically authorized by the Congress.

ANNUAL REPORT SEC. 6. The President shall make an annual report to the Congress concerning operations under this Act, together with such information, comments, and recommendations as he may deem appropriate for furthering the policy declared in section 2 of this Act.

APPROPRIATION AUTHORIZATION Sec. 7. Such sums as may be required to carry out the purposes of this Act are hereby authorized to be appropriated.

(H. R. 9835 as reported by the Committee on Government Operations July 21, 1954, follows:)

(H. R. 9835, Rept. No. 2441, 83d Cong., 2d sess.) A BILL To provide for the termination of Government operations which are in competition with private

enterprise Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That this Aet may be eited as the Termination of Federal Commereial Activities Act",

SED: 2: The Congress hereby declares that the polier of the Federal Govern ment should be at all times the encouragement of private enterprise. Certain aetivities of the Federal Government have developed whieh tend to diseourage private enterprise; in that the Federal Government is engaging in commercial and industrial activities in direct competition with activities engaged in by pri vate persons for profit: These commercial aetivities engaged in by the Federal Government deprive governments at all levels of tax revenues, and by competing

with private enterprise, weaken the strength of our national economie system it is therefore the purpose of this Act to provide for the termination, te the maxi

mum feasible extent of all commercial netivities engaged in by the Federal Government in the United States whieh compete with private enterprise. She: 3. As used in this Aot

(1) the term "commereial activity” means any commercial or industrial Activity performed by the Federal Government which is direetly in competition with activities engaged in by private persons for profit, and

(2) the term United States!? means the several States, Alaska, Hawaii, and Puerto Riee. SEE: 4: The President shall examine and from time to time reexamine each commercial activity engaged in by eneh department, ageret; and independent establishment in the executive branch of the Government and shalt determine what the effeet, if any, on essential activities of the Federal Government would be of terminating such commereiał tetivity:

SBC: : Whenever the President, after investigation, finds that any commercial Hotivity engaged in by the Federal Government in the United States can be earried on by private enterprise without substantially impairing essential setivities of the Federal Government, he is authorized to terminate sueh aetivity: In the course of terminating commereial netivities under this Aet; the President may

(1) modify or abolish funetions and aetivities,

(24 transfer fumetions and Hetivities among departments, agencies, and independent establishments in the executive braneh of the Government, and

31 provide for the transfer or other disposition of records, property, personnel, and unexpended balances of appropriations, to the extent necessary to effestuate sheh termination: That this Act may be cited as the Termination of Federal Commercial Activities Act."

Sec. 2. The Congress hereby declares that the policy of the Federal Government should be at all times the encouragement of private enterprise. Certain activities of the Federal Government have developed which tend to discourage private enterprise, in that the Federal Government is engaging in commercial and industrial activities in direct competition with activities engaged in by private persons for profit. These commercial activities engaged in by the Federal Government deprive governments at

all levels of tax revenues, and by competing with private enterprise, weaken the strength of our national economic system. It is therefore the purpose of this Act to provide for the termination, to the maximum feasible extent, of all commercial activities engaged in by the Federal Government in the United States which compete with private enterprise,

It is declared to be the policy of the Congress that the Federal Government shall not engage in business-type operations competitive with private enterprise except where it can be demonstrated that it is necessary for the Government itself to perform such operations in furtherance of national programs and objectives legally established.

Sec. 3. It shall be the duty of the Secretary of Commerce, acting under the instructions, rules, and regulations issued by the President, to receive from the public and examine specific complaints of Government competition with private enterprise and, where the facts warrant, consult and cooperate with officers of the Government supervising the Government business-type operations complained about in order to suggest, where appropriate, the termination or limitation of Government competition through the utilization of private facilities, products, or services in lieu thereof. SEC. 4. As used in this Act

(1) the term "commercial activitymeans any commercial or industrial activity performed by the Federal Government which is directly in competition with activities engaged in by private persons for profit; and

(2) the term United Statesmeans the several States, Alaska, Hawaii, and Puerto Rico. Sec. 5. The President shall examine and from time to time reexamine each commercial activity engaged in by each department, agency, and independent establishment in the executive branch of the Government and shall determine what the effect, if any, on essential activities of the Federal Government would be of terminating such commercial activity.

SEC. 6. Whenever the President, after investigation finds that any commercial activity engaged in by the Federal Government in the United States can be carried on by private enterprise without substantially impairing essential activities of the Federal Government, he is authorized to terminate such activity: Provided, however, That nothing herein contained shil! apply to any Government business-type operations being carried on on the effective date of this Act or to any Government business-type operations heretofore or hereafter specifically authorized by the Congress.

Sec. 7. The President shall make an annual report to the Congress concerning operations under this Act, together with such information, comments, and recommend ations as he may deem appropriate for furthering the policy declared in section 2 of this Act.

SEC. 8. Such sums as may be required to carry out the purposes of this Act are hereby authorized to be appropriated.

The CHAIRMAN. Mr. Ward, you have a statement from Mrs. Harden, the chairman of the Subcommittee on Intergovernmental Relations?

Mr. WARD. Yes, Mr. Chairman. She wants to put it in the record as she had to leave for another committee meeting.

The CHAIRMAN. That will be inserted in the record. (Mrs. Harden's prepared statement is as follows:)

STATEMENT OF HON. CECIL M. HARDEN, A REPRESENTATIVE IN CONGRESS FROM

THE STATE OF INDIANA It is a pleasure for me to see the results of 2 years of intensive work by the Intergovernmental Relations Subcommittee come to fruition in the full committee in the form of bills designed to take the Government out of unnecessary competitive commercial enterprise.

The founding fathers had genuine reason, seasoned by experience, to fear an enormous, all-powerful, centralized government. Experiences with the mother country created a lasting impression and a determination upon the framers of the Constitution to avoid the mistakes experienced under the Fritish Covernment. Accordingly, the Constitution was framed to create an balance of powers among the three branches so on one would becorre dorinant. Later the 10th amendment restricted central powers in these words:

“The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”

Through the years the centrel government has grown in size, with the addition of States, the increasing complexity of modern civilization, and the stress of wars

and emergencies especially during the past three decades. New departments and agencies have been established and each in turn has added auxiliary functions often of an operational nature which have taken them into the field of commercial enterprise.

If we stop to consider, however, the Federal Government must be sustained from taxes derived from individuals engaged in profitable enterprise. The role of government obviously is to govern and not to be in business. Our experience in studying this matter during the 2 years has convinced me, as I am sure it has all the members of the subcommittee, that the time for programed action is at hand.

I hope that the current hearings on these three important bills will produce permanent and positive methods of treating with existing commercial activities and preventing the development of new ones.

The CHAIRMAN. Do you care to make any statement, Mr. Osmers?

Mr. Osmers. Mr. Chairman, I will also give you a statement which can be inserted in the record.

The CHAIRMAN. That will be made a part of the record.

(Mr. Osmers' prepared statement is as follows:) STATEMENT OF Hon. FRANK C. OSMERS, JR., A REPRESENTATIVE IN CONGRESS

FROM THE STATE OF NEW JERSEY Mr. Chairman; for a generation the Congress has been attempting to do something in a practical way to terminate or limit unnecessary Government competition with private enterprise and free labor. The Harden subcommittee, of which I have the honor to be a member, has been studying the problem during almost the entire life of the 83d Congress. During the work of this committee, it became increasingly apparent to me that the work of the Harden committee, fine though it is, would be filed away with the results of the Bonner committee of the 82d Congress and the Shannon committee back in 1932. After a great deal of effort and investigation, on April 14 of this year, I introduced H. R. 8832, which I believe was the first practical proposed statutory effort to get the Government out and to keep it out of unnecessary competitive business-type activities.

I would like to read the declaration of policy contained in section 2 of H. R. 8832:

“DECLARATION OF POLICY "SEC. 2. The strength of this Nation rests on the free enterprise economic system. The framers of the Constitution of the United States never intended that this Government should compete with its people in the carrying on of business activity. This Government is now engaged in over one hundred business-type activities in competition with its people, such as the operation of hotels, railroads, tugboats, and banks; the manufacture of paint, rope, chain, fertilizer, ice cream, rum, clothing, spectacles, and false teeth; coffee roasting; radio and telecommunications and many others. Such Government competition tends to destroy initiative on the part of the people and to restrict the normal growth and expansion of private enterprise. It further deprives the people of opportunities for private employment and enterprise thereby reducing their ability to pay taxes without which the Government cannot exist. It is the declared policy of the Congress that the Government shall get out and stay out of business-type competition with its people wherever consistent with the national health and security.

I will not attempt to repeat here the many arguments that have been made before the Harden subcommittee, or that have appeared in its reports. Suffice it to say that no witness has yet come forward in favor of the Government competing with its citizens.

The committee has before it four bills: H. R. 8832, introduced by me, H. R. 9834 and H. R. 9835 introduced by you, Mr. Chairman, and H. R. 9890 which I introduced last evening. H. R. 8832' has a companion bill in the Senate S. 3547. While some have objected to this bill because it creates another board which reports to the President, I am of the firm opinion that it is the best of the bills under consideration. The Board would be composed of four members, the Secretaries of Commerce and the Treasury, the Comptroller General of the United States and the Director of the Bureau of the Budget. For obvious reasons this Board would be ideally constituted for the subject matter to be considered.

H. R. 8832 provides that the Board shall receive complaints from private business or labor, hold public hearings, make semiannual reports to the Presi

dent and the officers of Congress with recommendations, review contemplated new Government competitive activities. The Board would have the authority to require other Government departments, agencies, etc., to furnish information on the subject. H. R. 8832 also contains what I believe to be an excellent definition of Government competition. It is:

"DEFINITION OF 'GOVERNMENT COMPETITION' "Sec. 4. For the purposes of this Act Government competition shall be deemed to be any business-type activity of the Government which is, or normally can be, engaged in by the people."

H. Ř. 9834 would change the rules of the House and Senate and would provide for the termination of business-type activities by an individual bill for each activity in a somewhat similar manner as the handling of reorganization plans. This approach seems wholly impractical and unrealistic, Mr. Chairman, as it does not provide for the exercise of prudent judgment in each case. The process would disrupt the executive department and in a sense deprive that department of some of its constitutional prerogatives.

H. R. 9835 is a simple declaration of policy. While it is important for Congress to make a declaration of policy, business and labor in this country, are entitled to something more in this field than a mere declaration.

H. R. 9890 is a bill which I introduced yesterday and is in line with suggestions received from the executive department. It is an excellent bill and is very much along the lines of H. R. 8832. H. R. 9890, Mr. Chairman, contains four elements: First, it states a declaration of policy; second, it directs the Secretary of Commerce to receive complaints from private business and labor, and to investigate them; third, it requires all Government departments to submit plans for new business-type activities to the Director of the Budget for his approval, and the fourth, it requires the President to make an annual report to Congress on the progress made by the executive department in carrying out the declared policy of Congress. In my opinion, Mr. Chairman, any bill in this field to be effective and constructive must contain these four elements.

I want to take this opportunity to state for the record that the Eisenhower administration has made an outstanding start in attempting to end unnecessary Government competition. I also want to pay tribute to Congresswoman Harden, our distinguished colleague from Indiana, for the fine leadership she has given to her subcommittee in its work in this field. Ray Ward, who heads the subcommittee staff, has made an extremely valuable contribution to the work of the committee and has been a great help to me in my search for a legislative remedy.

In bringing this brief statement to a close, Mr. Chairman, I can think of no more appropriate words than those of Abraham Lincoln: "The legitimate object of government is to dy for the people what needs to be done, but which they cannot by individual effort, do at all, or do so well, for themselves.”

The CHAIRMAN. I might say to the winesses who are here that I owe them an apology for the request that went out for testimony and which limited the time to 5 minutes. That wasn't the intention, although undoubtedly I so advised Mr. Ward, who sent the wires. The Harden subcommittee has been holding hearings. How many, Mr. Ward?

Mr. WARD. Four volumes.
The CHAIRMAN. And how many pages of testimony, approximately?
Mr. WARD. About 1,600, I would say; something like that.

The CHAIRMAN. So, we see that the subcommittee has been fairly well advised of the situation.

It has always been my opinion that it is the height of absurdity for the Government to engage in any business which individuals or business organizations can transact. This is for the very simple reason that without the taxes which are paid by the individuals and workers, and by the business people, the Government couldn't exist. So, why commit financial suicide by continuing and extending Government operations?

From my own viewpoint, I see no necessity for legislation. The executive departments can take care of the situation if they desire

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