He is a member of the American Society for Public Administration and the International Institute of Administrative Sciences. Senator SALTONSTALL. Mr. Stans, the committee is ready for any statement you may have. STATEMENT OF MAURICE H. STANS, DIRECTOR, BUREAU OF THE BUDGET; ACCOMPANIED BY WILLIAM F. FINAN, ASSISTANT DIRECTOR, MANAGEMENT AND ORGANIZATION, BUREAU OF THE BUDGET; ALAN L. DEAN, MANAGEMENT ANALYST, BUREAU OF THE BUDGET; AND KENNETH F. McCLURE, ASSISTANT GENERAL COUNSEL, DEPARTMENT OF COMMERCE Mr. STANS. I have a prepared statement to present today, Mr. Chairman, but before I do so, I would like to make a few prefatory remarks. As I am sure you know, I have been Director of the Bureau of the Budget for only 8 weeks, or more precisely, since March 18. Prior to that date, matters related to the establishment of a new space agency were handled, insofar as the Bureau of the Budget was concerned, by the then Director, Mr. Percival Brundage, together with his staff. I did become familiar with the objectives and provisions of S. 3609 prior to transmitting the draft legislation to Congress on April 2. I have since given considerable thought to the bill and the issues which have risen in the course of the House and Senate hearings. I am here in the hope that I can be helpful to the committee in explaining why the administration believes that early enactment of S. 3609 is so important. I will say in all frankness that I am not familiar with all the background factors which were considered in the preparation of the legislation. For this reason I am accompanied today by the following members of the staff who did the technical job of drafting the bill: Mr. William F. Finan, Assistant Director for Management and Organization, Bureau of the Budget; Mr. Alan L. Dean, management analyst, Bureau of the Budget; and Mr. Kenneth F. McClure, Assistant General Counsel of the Department of Commerce, who was detailed to the Bureau of the Budget for this purpose. At the end of my statement I shall present certain amendments to the bill in the hope that they will satisfy certain objections which have been raised in the course of hearings before this committee. AMENDMENTS TO THE BILL Senator SALTONSTALL. Mr. Stans, the committee has received through its counsel, Mr. Weisl, certain proposed amendments which have been approved, we are told, by the Executive Office of the President and the Bureau of the Budget. They will be released at 2 p. m. today. They concern certain amendments in section 2 on page 2, lines 9 and 10; in section 4 (a) on page 3, line 18; in section 4 (a) (1) on page 3, line 20 and on line 23; and page 13, line 8, a new section 7 entitled "International Cooperation." (See p. 285 for text of proposed amendments.) Have you seen those amendments? Mr. STANS. Yes, sir. Senator SALTONSTALL. Those you approve of? Mr. STANS. Yes, sir; and I am prepared to offer them as amendments proposed by the administration to clarify some of the matters before the committee. Senator SALTONSTALL. Were these amendments submitted to the Defense Department? Mr. STANS. Yes, sir. Senator SALTONSTALL. And they have the approval of the Defense Department, as far as you know? Mr. STANS. That is right. Senator SALTONSTALL. And by the Secretary of Defense? Mr. STANS. As for the chairman's opening remark about the time which the agencies had to consider the bill before it came to the Congress, I should like to cover that later on in the course of my state ment. I am now referring, Mr. Chairman, to the prepared statement. The committee has already heard the views of many witnesses. I shall, therefore, in my statement, direct my remarks to the features of the legislation which, on the basis of previous testimony or questions raised by members of the committee, appear to require further amplification or explanation. The National Aeronautics and Space Act of 1958 was drafted by the Bureau of the Budget at the instruction of the President and was transmitted to the Speaker of the House of Representatives and the President of the Senate on April 2, 1958. In preparing this legislation, the Bureau adhered strictly to the wishes of the President as set forth in his special message to the Congress of April 2, 1958. Throughout the drafting there was the closest exchange of views with the National Advisory Committee for Aeronautics and the President's Special Assistant for Science and Technology, Mr. James Killian. As transmitted to the Congress, the draft legislation had, and continues to have, the unqualified support of both the National Advisory Committee for Aeronautics and Dr. Killian. I should also like to assure the committee that the bill was circulated to the other interested agencies for their views, and that many changes were made in the draft in response to agency suggestions. You have already been told that only a few days were allowed for agency review and comment. To keep the record straight, I should like to state that the bill was sent to the agencies on Wednesday, March 26, 1958, with a deadline for replies set at noon, Monday, March 31, 1958. Some agencies may not have received the draft until Thursday, March 27, but it was also true that agency comments were received and considered through the morning of April 1. Thus 5 to 6 days were given each agency, including the Department of Defense, to study and comment on the draft legislation. I will grant that this is a short time for the review of an important bill and that this included a weekend. However, I should also like to point out that the major features of the legislation had been communicated to ranking officials of the most directly affected departments and agencies well in advance of the circularization of the draft bill. Furthermore, the President was particularly anxious to have the legislation go to the Congress prior to the Easter recess in order that the members of the congressional committees involved and their staffs might have a week in which to examine the bill prior to the reconvening of Congress. In view of the urgent need for the Nation to move ahead with its space program, the President insisted that the Congress receive the administration's bill at the earliest possible date. Many bills which are complex are found to require some perfecting amendments in the course of consideration by the Congress. The Bureau of the Budget and the National Advisory Committee for Aeronautics are eager to assist in any way to help clarify or otherwise improve the present text. It is my view, however, that the House and Senate hearings to date confirm the essential soundness of the concepts on which the bill is based. Furthermore, it is my conviction that the organizational and administrative provisions of the bill are in general well conceived and should be retained by the Congress. In proposing this legislation, the administration was guided by a number of important considerations. Since these go to the heart of the matter, I should like to list them for the committee and comment briefly on each. First, it was desired that the agency charged with the general furtherance of research into the problems of flight and astronautics be a civilian agency under civilian control. The President, in his special message on space science and exploration transmitted to the Congress on April 2, 1958, set forth this objective in the following terms: I recommend that aeronautical and space science activities sponsored by the United States be conducted under the direction of a civilian agency, except for those projects primarily associated with military requirements. I have reached this conclusion because space exploration holds promise of adding importantly to our knowledge of the earth, the solar system, and the universe, and because it is of great importance to have the fullest cooperation of the scientific community at home and abroad in moving forward in the fields of space science and technology. Moreover, a civilian setting for the administration of space function will emphasize the concern of our Nation that outer space be devoted to peaceful and scientific purposes. I am gratified that almost without exception testimony before the House and Senate committees has endorsed the principle of civilian control over these aspects of space science and exploration aimed at furthering the general knowledge of mankind. The President has recognized from the outset, and the bill reflects this awareness, that certain space programs should be conducted under the Department of Defense because of their importance to the security of the Nation. On this there also seems to be no significant debate. The issue which has come before this committee is that of determining where the line should be drawn between space programs and projects appropriate for the civilian agency and those more suitable for administration by the Department of Defense. S. 3609 attempts to resolve this problem in a number of ways. The bill's policy section specifically provides that aeronautics and space activities "peculiar to or primarily associated with weapons systems or military operations" shall not be under the control of the civilian Agency, although provision is made for the conduct by the civilian Space Agency of research on strictly military projects on behalf of the Department of Defense. As a number of witnesses, such as General Doolittle and Mr. Quarles, have pointed out, there will be a gray area where there is doubt as to whether an activity "may be peculiar to or primarily associated with weapons systems or military operations." In such cases the assignment of responsibility will have to be determined by the normal processes of interagency cooperation. In some instances it will be necessary for the President, aided by Dr. Killian and other advisers, to resolve questions of agency jurisdiction. The Bureau of the Budget has found that it is almost impossible in legislation to establish precise divisions between agencies with closely related programs. I don't think that it can be done here, especially when the future scope and dimensions of the program are so uncertain. The alternative would be to place all space activities in either the Department of Defense or the new National Aeronautics and Space Agency. I doubt that the Congress will wish to do either of those things. I should like next to call attention to section 8 of the bill which provides for the transfer of related functions to the Agency. The purpose of that provision is to enable the agencies involved, with the approval of the President, to make those adjustments in their respective responsibilities as may be desirable. This provision will be especially important in the months to come, because the urgent need to move ahead with the space program has resulted in projects clearly civilian in nature being undertaken by the Department of Defense. These projects will in most instances be turned over to the civilian Space Agency as rapidly as it can be equipped to receive them, but this must be done on the basis of carefully worked out plans designed to minimize delay, duplication, or interagency conflict. Since the approval of the agencies surrendering functions is required, there is a guaranty that the National Aeronautics and Space Agency cannot on its own authority invade the proper spheres of other agencies or otherwise interfere with their responsibilities. The second major objective sought by the legislation is to build upon existing institutions and to avoid increasing the total number of Federal agencies involved in aeronautics and space matters. The bill accomplishes this aim by utilizing the National Advisory Committee for Aeronautics as the nucleus of the new agency. As General Doolittle and Dr. Dryden have pointed out in previous testimony, the National Advisory Committee for Aeronautics has elaborate facilities adapted to work in space research. Its large and competent staff of scientists, engineers, and technicians is already conducting investigations of problems requiring solution if man is successfully to unlock the secrets of space. Because there is no clear dividing line between aeronautics and astronautics, it is but logical that the highly respected National Advisory Committee for Aeronautics should evolve into a Space Agency as man develops the capability to navigate outside the earth's atmosphere. Again I am gratified by the general recognition that the President's decision to build upon the National Advisory Committee for Aeronautics is a wise one. The third objective of the legislation is to strengthen the present organization of the National Advisory Committee for Aeronautics in order to equip it to direct a large scale and urgent program with maximum effectiveness. The President has emphasized that he considers it vital that the new Agency be headed by a single official whom he and the Congress can hold accountable for results. In compliance with the President's instructions, the bill as transmitted to the Congress provides that a Director appointed by the President, by and with the advice and consent of the Senate, shall head the Agency and shall exercise its functions. All administrative authority is thus placed in a single official appointed by and directly responsible to the President. This is the traditional way in which Federal agencies charged with large operating programs are headed. The Bureau of the Budget believes it would be a serious mistake to depart from this principle of a single responsible executive. Some confusion has arisen concerning the provision in the bill for a 17-member National Aeronautics and Space Board appointed by the President. It is true that this Board is given the right to be consulted on major matters of policy, program, and Agency organization, and that it is authorized to make reports directly to the President. The text of the bill makes it clear, however, that while the Board has a right to be consulted and to be heard, it is a strictly advisory group. The Director alone, under the President, will be responsible for actions taken by the Agency. The purpose of providing for a National Aeronautics and Space Board was to retain the best features of the present committee of the National Advisory Committee for Aeronautics, which is held in such high regard by everyone familiar with its work. This Board will facilitate cooperation between the Agency and other Federal agencies and with the scientific community in the conduct of the space program. The Board will also be of material assistance to the Director in discharging his responsibilities and to the President as an independent source of advice on space matters. All members appointed to the Board from private life must be eminent in science, engineering, technology, education, or public affairs and must be selected on the basis of established records of civilian achievement. The conflict-of-interest laws of the United States will be fully applicable to them in their service on the Board. The fourth objective of this legislation is to equip the National Aeronautics and Space Agency with those authorities which it will require to move ahead swiftly and effectively in a field in which many novel problems must be expected. I shall not attempt in my testimony to discuss these powers in full, but I should like to refer to several which General Doolittle and Dr. Dryden, as well as the Bureau of the Budget, believe to be of special importance if the Agency is to perform its functions with maximum effectiveness. The authority to fix compensation at rates which are reasonably comparable with prevailing rates paid by non-Federal employers for similar work is very important for recruitment of the Agency's staff. Competitive compensation will enable the Agency to make effective use of research contractors and at the same time maintain the quality and morale of personnel employed in its Government-operated laboratories. Pay rates under this provision would be established and adjusted in accordance with regulations issued by the President. The Congress can be assured that the President's regulations will be designed to avoid serious disadvantage to other agencies not equipped with comparable authority. Furthermore, the actual rates set will be comparable to those of non-Federal employers only to the extent consistent with the public interest. It is not expected that the public interest will permit any of the employees of the agency to be paid more than the director himself, whose salary is set by the bill at $22,500 per annum. Approximately half the employees of the |