their minds, was, of course, facetious. You know, if we did not smile here once in a while, we would go crazy.

The CHAIRMAN. Mr. Riley, do you concur in the statements made by Mr. Burns yesterday, as to the legality of this?

Mr. RILEY. Yes, sir.

The CHAIRMAN. Does your organization have an attorney?

Mr. RILEY. We have the call of Joseph Padway or any other attorney we care to employ on a contingent basis. We do not have one on a retainer.

The CHAIRMAN. You have not requested your attorney to render an opinion?

Mr. RILEY. I have contacted an attorney whom I believe quite competent to discuss the subject and the language of my presentation belongs very much to him.

The committee the other day seemed to be at sea-they felt there was a fashion of enmity that persisted here in the reorganization orders and some of them-I do not remember just now who it waswanted to know who was behind the orders. I would not say I know who is behind it. I would say I could give you some names pretty well known in connection with it. One would be Harold Merrill, with the old National Resources Planning Board, whom I think has had his moments up here; Senator McKellar has discussed some of his works. Robert McKeever is another, who is a real-estate man in the Shoreham Building, and who I understand is on a dollar-a-year basis, and Mr. Paul H. Appleby says he knows all about the organization; and Mr. Edward A. Locke, Jr., here, whose biography I have, and his former assistant, Mr. Donald M. Nelson, he is supposed to be one of the coordinators; then I get the name of Jack Tait, who is the general counsel for the Federal Security Agency, and Mr. Tait, as I recall, is the president of the National Lawyers' Guild in Washington.

Those names, I just thought, might be wanted by the committee, since they were asking for names the other day.

Now, your committee may want to consider section 5 (a) (6) of the Reorganization Act, Public Law 263, which reads as follows:

No reorganization plan shall provide for, and no reorganization under this act shall have the effect of

Imposing, in connection with the exercise of any quasi-judicial or quasi-legislative function possessed by an independent agency, any greater limitation upon the exercise of independent judgment and discretion, to the full extent authorized by law, in carrying out of such function, than existed with respect to the exercise of such function by the agency in which it was vested prior to the taking effect of such reorganization, except that this prohibition shall not prevent the abolition of any such function.

There is not today any board of appeals in the Compensation Commission. But the creation of an administrative board of appeals with authority to "make final decision on appeals" in respect to Federal employees' claims, I believe this committee will agree, does violate section 5 (a) (6) of the Reorganization Act.

Under the plan as submitted, the independent judgment and discretion of the three-member bipartisan Commission is abolished in favor of a board of limited power and discretion which would be subject to partisan control of the appointing power whose decisions in theory it it supposed to review. Such board would have no authority to determine policies or questions of law, for that power which under the stat

ute now vests in the Commission would be transferred to the Federal Security Administrator.

You now will witness the final anomaly of the Federal Security Administrator appointing a subordinate board of appeals to review decisions made in his name. The board of appeals thus will be reviewing the acts of the head of the Agency. Is this the kind of administrative confusion and contradiction the Congress invited? The head of the Agency would be big enough to decide cases and even appoint a board of appeals, but not big enough to avoid being overridden by his own creature-his own board of appeals. Where else in all this vast Government has there ever even been proposed such a piece of hocus-pocus as this?

While we are trying to be fair in weighing these reorganization plans, we also must be alert to amateur lawmaking which is thus being permitted in the executive branch of the Government. This Plan No. 2 is an excellent example of what happens when we try to wear the left shoe on the right foot.

If you will refer to a copy of House Document No. 595 which is the message on Reorganization Plan No. 2, you will find at the outset a great deal of flag-waving and "corny" truisms which, for some unannounced reason, were omitted from Plans Nos. 1 and 3. We are told, for illustration, that "the fundamental strength of a nation lies within its people." That is the opening sentence the Bureau of the Budget set before the President for his signature. All the platitudes of all the ages appear to have been scraped together for use in gaining assent to this reorganization plan.

Another quote is

The most basic and at the same time the most difficult task of any country is the conservation and development of its human resources.

That is the kind of statement nobody cares to dispute. Having gotten agreement and seeming confidence on those and other trite observations, the recitation moves along into this type announcement:

By abolishing the Commission, the plan eliminates a small agency and lightens the burden on the President.

There will never be an agency of Government which has done a better job than the United States Employees Compensation Commission to lighten that famous "burden on the President." This Commission is never heard from except when time comes to submit its annual report. It never gets in anybody's hair. It does not specialize in hiring any persons of questionable American-line leanings. It tends to its assigned business and keeps too well occupied to mix in with anything in which it is not concerned.

But is is often true, even in the case of an individual, that those who work the hardest and with a minimum of noise reap the reward of failure to politic in the right places with the right persons.

As a matter of fact, I believe this committee will find if it will call for the White House calling lists as far back as 1916 when this Commission was created, that there have been only six times when any members of this Commission ever called to see the President or were invited except at social functions. So, it can hardly be said that this Commission has soaked up any of the official time of the President whose "burden" the Bureau of the Budget has decided it has to lighten.

The Bureau says too many persons see the President or, as officials, have to see him and that so much of his time is absorbed by such visits. Any governmental agency whose head or heads have talked to the President no more frequently than once every 5 years can hardly be said to constitute a "burden on the President," which so far as this Commission is concerned is nonexistent.

The Bureau of the Budget, over the signature of the President, tells you that "The Federal Security Administrator as the head of the Federal Agency with the greatest experience in insurance is in the best. position to guide and further the progress of the Commission." The Bureau of the Budget, the fiscal control agency for the entire Federal Government, herewith betrays an amazing, even an alarming ignorance of the functions of the respective agencies. The reason is simply that the United States Employees Compensation Commission is not engaged in administration of an insurance program.

The Commission is engaged in the exercise of quasi-judicial functions and administration of specialized statutory functions wholly unrelated to any functions of the Security Agency and the experience of that Agency in the same field does not qualify it to guide or further the functions of the Commission.

When I say this, Mr. Chairman, I am speaking as one who is asking that there be no destructive devices permitted to be applied to the act of Congress which relates to Government employees-the Compensation Act. The beneficiaries of that act are entirely satisfied with the manner in which your law is being applied to the facts in each compensation case. You have not heard any complaints from any of

them.

In this connection, I recall what has been happening in the Social Security Board which has applied predatory and bureaucratic cannibalistic techniques toward the civil-service retirement system. In the retirement system are assets of several billion dollars built up with the deductions from employees' earnings in the Federal Government. The Social Security Board has been making frantic efforts to grab control of the civil-service retirement fund which is entirely sound financially and which is being administered to the entire satisfaction of the Government employee for whom it was created.

Because I believe that much of this Reorganization Plan No. 2, so far as it relates to Government employee benefits is concerned, was written in the Social Security Board, it is not too early to express concern at what will happen to the retirement fund if you fail to disapprove this latest maneuvering in Plan No. 2.

Two months ago, the Government employees council of the American Federation of Labor presented its case before the House Ways and Means Committee for retention of the civil-service retirement system, entirely separate from a marginal or submarginal welfare insurance system, charity, or dole as operated by the Social Security Board.

I believe the council sufficiently impressed that committee with the deep earnestness of its plea that, as you can note from the printed proceedings, one member of that committee after another gave clear assurance that the assets of that fund would not be allowed to get into the hands of the Social Security Board. In fact, Representative Forand, of Rhode Island, at the conclusion of the hearings outlined the composite view of the committee, giving full assurance that confisca

tion of the retirement system would not be permitted. On that note we rested our case.

But now we seem to find the Social Security Board making an end run to ram its program through in reverse and by taking charge of the compensation machinery set up for Federal employees in the sweet name of reorganization. An inoffensive commission tending to its own affairs, efficiently and economically, is marked for obliteration because the Social Security Board and the Bureau of the Budget say it is engaged in administering an "insurance program."

I have information that before long you will receive further reorganization orders "streamlining" the Federal public power projects into the Interior Department. And that one of these orders if adopted eventually will be the knockout blow to all public hydropower activities, not only of the Federal Government but also of power project authorities within States. Further, that the St. Lawrence waterways would literally go down the drain as something to be forgotten for all time to come, all as the result of a seemingly innocuous reorganization order designed only to "streamline" power projects.

And while the Federal employee directly is not concerned with power policies, he is interested in what is causing the reorganization orders which affect him directly, such as the one to abolish the Civil Service Commission, in line with the Brownlow-Gulick-Merriam reorganization outline which the Congress rejected in 1938.

And though you did disapprove the Brownlow plan at that time, much of it is coming back to the surface. In 1938, the reorganizers partitioned the Department of Labor by saying they had decided what the "rights" of labor were and what were its "needs." When the reorganizers of that day got through, it was found that the "rights" of labor were so few that the Department of Labor was almost entirely stripped of everything except the Women's Bureau and the Children's Bureau.

It was decided that labor had no "right" to a job but that labor had a "need" for a job. So labor's "need" for a job was shifted to Social Security Board, along with the old-age and survivors insurance and other such enterprises. The same theme appears to have obtained during the recent war when it was decided to give the Federal Security Administrator the added job to control manpower, so Mr. McNutt was both Chairman of the Manpower Commission and Administrator of the Federal Security Agency.

If you ask the Bureau of the Budget why interested parties were completely ignored when it accepted and approved these reorganization orders for the President's signature, you are told that the President ordered the Bureau to refuse to discuss the matter. The Bureau says this is on the grounds that anyone who wants to present its side of the story so as not to take up the time of busy lawmakers is of a "special interest group" and therefore must not be tolerated.

Some of the very flaws I am pointing out now might have been avoided if the Bureau of the Budget had not wanted to be secretive and to practice that "passion for anonymity." They are not the supermen, except they do not admit it.

Creation of a sugar Department of Public Welfare can become a fine opening for any Cabinet officer who is assigned to head up such

Department. It could be that some large insurance company might want the services of just such a man after he is built up to Cabinet stature. Any suggestion of building up a job as a potential steppingstone to a better-paying job can hardly be endorsed by the Government employee when agencies designed for his benefit are scraped together to help supply the justification for such Cabinet post.

The Bureau of the Budget says in the reorganization order that abolition of a statutory bipartisan commission and substitution of an administrative board of appeals with a single official in charge of operations has proved "satisfactory to claimants in many similar programs," and that

It is essentially the plan * ** men's compensation programs.

employed by "many States" in their work

The statement regarding the practice of the States in workmen'scompensation administration is definitely contrary to the facts. Nor can the Bureau of the Budget plead that it did not know any better.

The facts are and were definitely known to that Bureau. In 36 of the 47 States workmen's-compensation laws are administered by an independent commission. Only eight States have departmentalized administration and in three States administration is by the courts.

In no instance is this specialized administrative and quasi-judicial function administered by an agency comparable to the Federal Security Agency.

The plan for substituting a single administrator for a bipartisan board destroys the important advantage of continuity of policies. and decisions and would make possible partisan control of workmen's compensation administration.

Repeatedly, the International Association of Industrial Accident Boards and Commissions have emphasized the importance of commission form of administration of this function. The American Federation of Labor, employees' organizations in general, and insurance associations affected by the Federal workmen's compensation laws likewise have advocated this form of administration and retention of the independent bipartisan commission.

I believe your committee may want to ask the Bureau of the Budget if, at any time, it or any other agency ever made first-hand and consultative investigation of the operations of the Compensation Commission to determine what practical advantages might be expected from this change of administration. Or did it do the whole job of arriving at its conclusions in this case as a paper project? Also the committee may want to inquire whether any person or "special-interest group" in Federal Security Agency were heard on the general theme of reorganization. Certainly the Estimates Division of the Bureau will tell you that the Commission repeatedly has been complimented upon its economy of operations. Unless the Bureau can demonstrate that some one or more points in Congress' design for reorganization can be met under this order, I ask this committee to support the resolution of disapproval.

In this Reorganization Order No. 2 there is language which gives the Federal Security Administrator authority to perform the present functions of the Commission "in such manner and under such rules and regulations" as he may prescribe. Such blanket authority places no limitation upon his powers and obviously leaves to his discretion any changes in administration as he may decide upon.