Under current law the Secretary of HEW is required to make the decision to remove from the market products which present an imminent hazard to health.106 No statute directs the FDA Commissioner to make any final decisions because there is, in fact, no statutory base for the Food and Drug Administration whatsoever. The FDA Commissioner receives his authority solely by delegation from the Secretary of HEW; these delegations of authority, made through orders published in the Federal Register, may be rescinded by the same process. 107

The FDA's lack of independence is reflected in a number of other ways. The Secretary of HEW controls the FDA's budget and lawyers (the lawyers assigned to FDA are a part of the General Counsel's Office of the entire Department of HEW). The Justice Department can refuse, as it has in the past,108 to bring enforcement actions recommended by the FDA. And, the Commissioner of FDA can be fired and replaced without his successor undergoing Senate confirmation. In short, the FDA has virtually no formal independence. And if the past is any guide, very little real independence.

We believe it is time to upgrade the status and independence of the FDA within HEW. Below we suggest several specific measures to achieve these ends.

First, the FDA Commissioner should be appointed by the President and confirmed by the Senate. This will increase his visibility and accountability.

Second, the FDA Commissioner's level of compensation should be increased. But rather than raise his salary to level IV on the Execu tive Schedule as Secretary Califano has proposed, we suggest that the FDA Commissioner should be compensated at the rate prescribed for level III. Level III, for example, is the rate at which the Administrator of the FAA (also a regulatory agency within the Executive Branch) is paid. The Assistant Secretary for Health at HEW is also at level III. The importance of FDA's mission entitles its head no less recognition and compensation.

For similar reasons we believe that the FDA Commissioner should not be required to report through the Assistant Secretary for Health to the Under Secretary and then to the Secretary of HEW. The FDA Commissioner should at least be on a plane with the Assistant Secretary of Health within the HEW organization.

The FDA should be removed from Public Health Service. Organizational location within PHS does not promote interaction between the FDA and the other health agencies where there is little need to relate because of diversity of functions. With the exception of FDA's interest in research activities of NIH and some of the epidemology and clinical licensing functions of the Center for Disease Control, there has been little interaction between FDA and the other PHS agencies. Although the FDA has valuable relationships with elements of the Public Health Service, removing it from the Service should not end those relationships. It should, though, make clear that

100 See, e.g. 21 U.S.C. § 355(e).

107 The main delegations are at 21 C.F.R. § 5.1. 108 See 21886 Cong. Rec., June 21, 1972.

the FDA Commissioner is not a subordinate of the Assistant Secretary for Health, and give the agency more visibility. It should also help improve administrative and program operations. Furthermore taking the FDA out of the Public Health Service would loosen Civil Service hiring constraints and improve the ability of the FDA to recruit the highly qualified people it needs.109

Steps should be taken, too, to increase the independence of the FDA. To begin with, the agency should be statutorily authorized, with its own general counsel's office and authority to bring its own enforcement suits. The Commissioner should be given final authority to make food and drug safety decisions. A congressional mandate for the establishment of a Food and Drug Administration with direct powers being placed in the Commissioner of Food and Drug should make for a more stable, efficient, and effective agency. As a practical matter, the Commissioner makes most food and drug safety decisions and we see no reason why this practice should not be statutorily authorized. The Commissioner is selected for his special competence and is most familiar with the health and safety questions involved. He is in the best position to make such decisions. Similarly, the Secretary's present authority to declare a product an imminent hazard should more properly be the express statutory duty of the Commissioner of the FDA. The amount of time and attention the Secretary can devote to a food safety decision is minimal.

We recognize that there may be no such thing as "absolute safety”— that such decisions involve a weighing of benefits and risks. We feel, however, that the FDA Commissioner is in the best position to make such decisions.

This is not to say that the FDA Commissioner's decisions should be divorced entirely from the viewpoints or influence of the President, the Secretary of HEW or even other agencies. Indeed, we believe that the Secretary of HEW should specifically be empowered to propose rules and set deadlines in a similar manner as the Secretary of Energy performs such activities with regard to the Federal Energy Regulatory Commission (FERC).110

Congress may, at some future time, consider the desirability of removing the FDA from an executive department, and making it wholly independent. But for the time being, at least, we believe that by increasing its stature and independence within HEW, the FDA can be a much more effective regulatory agency.

Interim Reforms

Until the USDA food regulatory functions can be transferred to FDA a number of reforms should be made to improve the existing system.

First, USDA and FDA should systematically review agency regulations and jointly propose regulations to correct any disparities in labeling, standards or other requirements. We believe 6 months from the date of publication of this report is enough time to take this action.

100 For similar reasons. Congress may want to consider allocating the FDA additional positions under Section 210(g) of the Public Health Service Act, which authorizes the Secretary of HEW to establish and fix the compensation for a certain number of upgraded positions in the PHS in the professional, scientific, and executive service which require the services of specially qualified personnel.

110 See Chapters 1 and 6.

If this is not done within 6 months, Congress should, by statute, require such joint regulations.

The agencies should designate continuing long-range planning committees to devise ways in which the agencies can better coordinate their activities and jointly pursue rigorous enforcement and consumer education goals. Although the recent meetings and discussions between top level staff at USDA and FDA are worthwhile, a more structured approach than occasional meetings is needed to effectively coordinate their activities. This approach is likely to include, for example, increased use of cooperative agreements, frequent meetings between top level staff in each agency and greater access to inspection reports and other records.

Despite the obvious need for more anticipatory discussion of policy directions and alternatives of concern to both agencies, most communications between the agencies occur on an ad hoc, case-by-case basis as problem situations arise. Planning committees in several crucial areas-inspection procedure and technique, labeling policy, for example-should be formed under the chairmanship of the top program personnel from each agency. These committees should report to an umbrella committee chaired by the Assistant Secretary of USDA for Food and Consumer Services and the Commissioner of FDA.

Finally, Congress needs to review and rationalize all food regulatory authority to insure that the FDA will have appropriate and adequate directives for its enforcement efforts. As pointed out above, FDA now lacks the needed authority to demand access to documentary records, to require full ingredient labeling of food products, and to require registration of all food establishments subject to FDA regulation. Congress should begin consideration of such legislation as soon as possible.

CHAPTER FIVE

TRANSPORTATION REGULATION

Transportation affects the daily lives of all Americans—as passengers, consumers, employees, shippers and investors. Transportation influences population distribution, economic development, the shape of cities, access to markets and materials, and the pace, style and quality of life. On the international scene, transportation is the connecting link which permits the exchange of goods and people among the nations of the world.1

In 1975, the national transportation bill-the total cost of all private and civilian government spending for transportation equipment and services-amounted to more than $300 billion, equal to one-fifth of the gross national product.2 About one out of eight persons in the labor force is employed directly in some aspect of transportation.3 The Federal Government alone spends almost $20 billion per year on transportation related agencies and programs, not including its own purchases of transportation goods and services. These cost estimates. actually understate the real impact of transportation on our society, since they exclude the indirect social and environmental costs of accidental deaths and injuries, environmental pollution, urban sprawl, and dependence on foreign energy sources.

Because of the importance and complexity of the U.S. transportation system, government at all levels-Federal, State and local-has assumed a wide range of responsibilities and roles in transportation. At the Federal level, these responsibilities include:

Promoting the development of an efficient and accessible national transportation system.

Promoting fair competition and protecting the public from abuse of monopoly power.

Protecting the safety of travelers and cargo.

Balancing environmental, social and energy goals with transportation needs.

This chapter examines the organizational structure of Federal transportation regulation. Our study indicates that the basic organizational problem in transportation regulation is not overlap and duplication-though improved coordination among the many transportrelated Federal programs is badly needed. The basic organizational problem is the fragmentation of the overall Federal role in transpor

1 The committee gratefully acknowledges the assistance of the U.S. General Accounting Office and GAO's Transportation Program Coordinator, John Vialet, in preparation of this chapter. Conclusions and recommendations represent the views of the committee and are not necessarily positions of the U.S. General Accounting Office.

"National Transportation Trends and Choices (To the Year 2000). Issued by the Secretary of Transportation, January 12, 1977, p. 23.

Ibid. p. x.

Estimate by U.S. General Accounting Office, October 21, 1977.

tation, which has prevented the development of a unified and logically consistent national transportation policy.

We believe that a unified, logical, comprehensive and equitable national transportation policy is the essential prerequisite for an effective transportation regulatory system. In the long run, the effectiveness of transportation regulation will depend on the clarity and wisdom of our national goals and objectives in transportation. The organizational changes proposed in this chapter are intended to make the process by which we develop and implement these goals and objectives more rational and efficient.

The Federal Government's responsibilities in transportation have developed over a period of many years, and in some instances (such as the Coast Guard) are as old as the United States itself. Historically, most Federal transportation programs have been narrowly coneeived, typically addressing a single problem relating to a single mode of transportation.

As new transportation problems have arisen, new programs and agencies have been established-with little or no attention to coordinating existing programs and agencies with the new activities. Over the years, this process of piecemeal and incremental growth has produced a wide range of transportation programs and a fragmented organizational structure-more than 30 agencies-to administer them.

For example, the original Federal independent regulatory commission, the Interstate Commerce Commission, was created in 1887 to protect the public from the abuse of monopoly powers by the railroads. Over the years, ICC jurisdiction has been extended in piecemeal fashion to motor carriers, barges, freight forwarders and oil pipelines in a process of "patchwork political decisionmaking" which reflects "the pressures and compromises that have always been the hallmarks of the legislative process in Washington." "

The ICC regulates all rail traffic, some motor carrier traffic, and a small fraction of inland waterway traffic; other agencies regulate air and ocean transportation. Government financial support for the railroads and highways is separately administered by two operating administrations of the Department of Transportation-the Federal Railroad Administration and Federal Highway Administration. Federal support for the inland waterways is administered by the U.S. Army Corps of Engineers. Adding to the fragmentation is the varying degree of control exercised by the Congress-which plays a dominant role in such programs as the development of inland navigation projects, highway spending and merchant marine subsidies.

In combination with the efforts of State and local governments and the private enterprise system, Federal transportation programs have helped to produce one of the most efficient and economically productive transportation systems in the entire world. But in achieving this success, we have also created a complex and inconsistent set of Federal transportation policies whose outward and visible sign is the organizational fragmentation of Federal transportation programs and agencies.

Our study indicates that the fragmentation of Federal transportation responsibilities and the absence of a unified national transporta

Kohlmeier, Louis M., The Regulators, Harper and Row, 1969.