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Should there not be a sentence inserted providing that the President has got

to decide what activities belong to the Space Agency and what to the Defense Department?

There may be a dispute between them. Somebody has got to decide that.

Haven't you got to insert a further amendment to cover that point properly by saying the President shall decide?

I would think that that was essential.

Mr. McCLURE. Senator, as I understand it, with the amendment to the policy statement, there will still be the problem of the gray area, as the Director indicated in his testimony, sir, which the President, with the assistance of Dr. Killian and other advisers, may have to resolve.

Senator SALTONSTALL. Sure.

Well, then, a sentence to that effect should be inserted. That is all I am saying.

It seems to me your amendment is not complete in its present form.

If Senator Johnson and I disagree—if Senator Johnson says it is military and I say it is civil, we argue back and forth, and we don't get anywhere? The President has to decide it; has he not?

Mr. McCLURE. The President has to decide it, but I don't think it is necessary to have express authority in here for him to do that.

Mr. FINAN. This is part of the constitutional responsibility of the President. This is just part of his normal day-to-day work, dealing with issues of this kind that arise between agencies with closely related programs.

We would feel he would have ample responsibility and authority for doing this without specific reference to it in the bill.

TRANSFER OF PROJECTS AND/OR FUNCTIONS

Senator SALTONSTALL. In your statement on section 8, which is the section that will allow transfer of functions to the space agency, you used the word "projects.''

I call to your attention that section 8 says "functions."
Do you mean “projects” or do you mean “functions”?

Mr. Stans. Well, I think very clearly it means both, in the sense that a project is a lesser part of a function.

Actually, the bill
Senator SALTONSTALL. The bill uses "functions."
Mr. Stans. It refers to functions and then says, in parentheses :
* * * including powers, duties, activities, facilities, and parts of functions.

So, I would consider the transfer of projects would come within "activities."

Senator SALTONSTALL. I think that is so; but I think there is a great distinction between “projects” and “functions."

I would construe a function as very much more fundamental in a department than a project.

Mr. STANS. It is a broader term, certainly.

Senator SALTONSTALL. Now, if you are going to transfer functions you and I discussed this privately the other day-shouldn't you at least notify Congress that you are going to do it?

If it is unconstitutional-as you pointed out the other day in your private conversation with me to provide for prior approval by Con

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gress, Congress certainly should be consulted or notified in some way or other.

Mr. Stans. I don't think there would be any serious objection to a provision requiring that Congress be informed of these transfers of functions, so long as it was within the constitutional limitation; but I think there is precedent, although I can't cite the precedent offhand, for this type fo language.

The Airways Modernization Board, I'm told, has this precise language.

Senator SALTONSTALL. This goes a little further. It seems to me that transfer of functions to the Space Agency are more important in broad national policy questions than transfers to the Airways Modernization Board. I don't want to belabor that point because I have several other questions, but it would seem to me that Congress should be notified if a function was going to be given up in the space research and development area because that involves substantial appropriations and it involves basic policies that the Congress had debated when it put particular functions in particular departments.

Mr. STANS. I would assume that practically all of the transfers under this section would take place rather promptly.

LETTING OF CONTRACTS

Senator SALTONSTALL. Now, you have stated very positively in your prepared talk that you prefer a single official to a small commission. Senator Anderson has taken that up with you. Shouldn't the Board have veto power, or confirmatory power on certain major capital undertakings? For instance, this is an agency that will make contracts for construction. Here we have a single man who might make a contract for a $500 million project. These projects will likely run into awfully big money. Shouldn't the Board on capital undertakings, say contracts of over X dollars, have a confirmatory power even though it has only a consultative role on other things?

Mr. STANS. Of course, before the head of an agency could commit anything of the size of money you mention, hundreds of millions of dollars, it would have to pass the Bureau of the Budget and the President and the Appropriations Committees of Congress, and I would assume there would be pretty careful scrutiny along the course of any proposal of that type.

The basic proposition is whether or not an agency operates better with a single head who is accountable to the President and to the Congress for his actions or whether you can have a large group of people telling the Director what to do. It just doesn't seem that a group of unpaid people meeting at relatively infrequent intervals can assume the function effectively of directing the activities of an agency of this size and power.

SALARY MAXIMUM

Senator SALTONSTALL. Now, may I ask you this question? Do I understand from your statement that while there may be salaries commensurate with private employment in this Agency, that no one salary should be more than $22,500, which is the salary of the Director? Is that what you said?

Mr. Stans. I would think that would be the only way you could effectively administer this activity.

Senator SALTONSTALL. I think the Civil Service Commission should discuss that question with us a little bit more.

INTERNATIONAL COOPERATION AND FOREIGN CONTRACTS Now, you have offered an amendment relating to international cooperation. “The agency may engage in a program of international cooperation," and so forth, "pursuant to agreements negotiated by the Department of State or approved by that Department”. At the present time the military I know are cooperating in research projects in Belgium and France and other places. They are placing contracts. Certainly they can't be getting the approval of the State Department for those research agreements to take place over there. This amendment as now drafted might have the Department of State involved in a very technical space research agreement that we might want to make, for instance, with England or France or some other country.

Mr. STANS. I think, Senator, there is a confusion of terms. This provision relates to international cooperation.

Senator SALTONSTALL. That is right. Mr. STANS. This term means activity between nations, and in that case the State Department would be brought in. I would think that that would not preclude the Department of Defense giving a contract to some contractor in a foreign country.

Senator SALTONSTALL. Well, perhaps you clarify that by your interpretation. I might not interpret it quite as you have. It would seem to me that the language might be thought to apply to any agreement that was made by the Space Agency or by the Department of Defense.

Mr. Stans. I don't think it is so intended.
Senator SALTONSTALL. I agree it may not be so intended.

ACCEPTANCE OF GIFTS

· Now, we have talked before about outside gifts. Have you any precedent to show that any agency of Government can receive gifts, we will say, from some foundation or some private individual and use them for Government activities?

Mr. STANS. I understand, Senator, that this is language equivalent to provisions in the legislation relating to the National Science Foundation and the National Bureau of Standards. But I will say this, and I am authorized to say this, that if this provision is objectionable to Congress, the administration isn't going to be greatly concerned about its deletion. It was thought this would be a helpful provision in the sense that some item of research, some piece of research equipment or other, might be received from a private contractor for the use of the Agency and it might be helpful to have that provision in the bill, but if there is objection to it, it is not basic to the purposes of the

bill.

OBLIGATED SERVICE AFTER TRAINING Senator SALTONSTALL. Now, as to the period of obligated service after a training period—I also discussed this in private conversations with you—the ratio is 1 to 3, to put it very quickly because my time

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is running out. In other words, we will say an employee goes out for 6 months. He will only have to work for 18 months when he comes back although we may have given him a very expensive training. Shouldn't the period of obligated service be increased to at least six times the training period, so that if he went for 3 months, he would have to work thereafter for 18 months? If he went for 6 months, he would have to work for 36 months or 3 years?

Mr. Stans. I will ask Mr. Finan to answer to that since he is familiar with the evolution of that paragraph.

Mr. FINAN. Senator, that, of course, is a policy issue. Someonein this case, the Congress has to decide what is an appropriate minimum period of time for an employee to work after having received a given amount of training: We used as our guide in the preparation of this language the text of the general training bill which would give this kind of authority throughout the Government and followed it, I believe, precisely. That is the bill which has passed the Senate and is now pending in the House.

Senator SALTONSTALL. Mr. Chairman, my time has expired but I have one more question that could be answered very quickly.

Senator Johnson. Proceed, sir.
Senator SALTONSTALL. Thank you, sir.

COOPERATION FROM OTHER AGENCIES

Mr. Stans, do you feel it would be desirable for the Director of the Space Agency to have authority to call on all other Government departments and agencies for information developed by them with respect to space exploration research? Now, that would be an extension of

your section 8, as I see it. Mr. Stans. I think it would be quite desirable for the agency to call on any other agency that had information in this field.

Senator SALTONSTALL. It would be helpful to have that specifically included in the language of the act in some way, would it not, even though it might be interpreted from the present language.

Mr. STANs. I think the act can be interpreted to include that. There is no objection to adding additional words that say it more precisely if you think it is necessary.

Senator SALTONSTALL. Thank you, Mr. Stans. Thank you, Mr.
Chairman.

Senator JOHNSON. Thank you, Senator Saltonstall.
Senator Symington?

ADMINISTRATIVE ORGANIZATION OF NEW AGENCY

Senator SYMINGTON. Mr. Director, are you acquainted with the
President's desire to reorganize the Pentagon?

Mr. STANs. I am acquainted with his desire, yes sir.
Senator SYMINGTON. Are you acquainted with the bill itself?

Mr. Stans. Not a great deal. Again, Senator, that bill was evolved prior to the time I became Director of the Bureau of the Budget.

Senator SYMINGTON. What were you doing prior to that time?

Mr. Stans. I was Deputy Director of the Bureau and active in other matters. The last Director participated in these reorganization plans.

Senator SYMINGTON. Have you anybody here who knows that bill? Mr. FINAN. I am generally familiar with it, Senator Symington.

Senator SYMINGTON. Well, as I understand it, the purpose of the bill is to eliminate duplication and waste and consolidate administrative authority with administrative responsibility. Is that correct?

Mr. FINAN. That is correct, sir.

Senator SYMINGTON. If we were going to start a new Pentagon structure today, do you think we would start it with 5 Air Forces and 4 services?

Mr. FINAN. I would hope not, sir.

Senator SYMINGTON. We had an agency once called the Surplus Property Board. It got beset with problems, so they appointed an Administrator. Do you remember that?

Mr. FINAN. Yes, sir. I recall that rather distinctly.

Senator SYMINGTON. Then we had a board running that was called the RFC. We decided we had better have an Administrator handle that instead of a board. Is that right? Mr. FINAN. I recall that one even more distinctly, yes, sir.

Senator SYMINGTON. And the purpose of this bill is not to have 17 people, each with some ax to grind, wandering around to have some influence on a decision that has to be made quickly, based on the testimony we have about space problems. Do you agree with that?

Mr. FINAN. Yes, sir.

Senator SYMINGTON. And after all, if there is a crook in any department, or inefficiency, that is fundamentally the responsibility of the Chief Executive of the United States, is it not?

Mr. FINAN. Yes, sir.

Senator SYMINGTON. And if he has to delegate his authority, based on common business practice and commonsense, it is better for him to delegate it to an individual than it is to a board meeting 3 or 4 times a year. Is that correct?

Mr. FINAN. Yes, sir.

Senator SYMINGTON. And the law prescribes, as I read it, that on matters of major policy the Director shall consult with these 17 people. That is right, is it not? Mr. FINAN. That is correct.

Senator SYMINGTON. And if one of them had access to the President of the United States, one of the members of the Board, and didn't agree with the Director's decision, he could appeal to the President himself, could he not, and say he thought the Director's act was wrong? . Mr. FINAN. If the President would accept such an arrangement, yes, sir.

Senator SYMINGTON. Well, you might consider the fact the President wouldn't want to put anybody in a position of such responsibility and then be unwilling to speak to such person, if the latter had something to bring to his attention.

Mr. Finan. I would think that would be a fair assumption, Senator.

Senator SYMINGTON. So all you are doing here is trying to start out with something which would eliminate the type and character of mess we have in the Pentagon today, from the standpoint of organization and functioning. Is that a fair statement?

Mr. FINAN. Well, I would prefer not to compare the problem of the Space Agency with the problem of the Pentagon. We are trying to set up a straight line operation here, Senator.

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