Mr. LAWTON. We can. It is quite a long story.

Mr. DIRKSEN. And whatever results were obtained and remedies suggested can also be set forth in rather brief compass.

(The statement requested is as follows:)

STATEMENT OF ADDITIONAL STUDIES CONDUCTED BY THE BUREAU OF THE Budget, JULY 1, 1941, TO JANUARY 1, 1943

Studies of management and organization problems undertaken by the Bureau of the Budget in the past 18 months in addition to those described in the justification of the 1944 appropriation are listed below. For those studies where achievements are measurable, such results have been reported. Very frequently, however, it is not possible to compute the man-hours, equipment, and dollars saved as a result of better organization and procedures, although the improvement may be of great importance in terms of carrying out agency programs in an effective fashion. Furthermore, many Bureau studies are carried on in collaboration with the departments and agencies concerned, decisions on a course of action are arrived at through a process of negotiation, and the results achieved are the product of a joint effort.

The Bureau has given intensive study during the past 18 months to each of the important areas of the war effort. Staff were assigned to work continuously in these areas and to help improve the administration of the following agencies: War Production Board, Office of Price Administration, War Manpower Commission, Board of Economic Warfare, Office of Lend-Lease Administration, Office of the Coordinator of Inter-American Affairs, Office of Strategic Services, Office of Defense Transportation, Office of Economic Stabilization, National War Labor Board, Office of Civilian Defense, Office of Defense Health and Welfare Services, War Relocation Authority, Petroleum Administration for War, and the Alaska War Council.

The Bureau worked with the appropriate officials in the development of the initial plans for the establishment of these agencies, aided in drafting Executive orders, and once the agencies were established, carried on continuous assistance in an effort to get them organized on an effective basis, without taking away the responsibility of the agency heads. This type of assistance in the establishment, consolidation, and realinement of agencies, and readjustment of the work of agencies in the light of changing conditions, is a continuing activity of the Bureau. Sometimes the major attention of the Bureau has been to discourage an agency from taking some unsuitable step in organization or operating matters.

In the case of the War Production Board and the Office of Price Administration, which present very complex administrative situations, several staff members have assisted in resolving a variety of problems of internal organization, both in Washington and the field, and in allocating functions between these and other agencies to keep overlapping of activities at a minimum. Organization questions that have received attention include such matters as the degree of delegation of responsibility to field offices, the headquarters organization required to control field operations, the facilities needed for development of program, the character of administrative services required, the development of satisfactory relationships with the central service agencies of the Government such as the Civil Service Commission and the Procurement Division of the Treasury Department, and the development of simple but satisfactory working procedures.

A study of the latter type was carried in respect to the lend-lease program. In collaboration with Treasury and lend-lease officials a system of fiscal records was developed for lend-lease transactions. Subsequently, changes were worked out which reduced the lag between the time a request for lend-lease aid was made and an order was placed with the contractor, from an average of 30 days to less than 5 days. In addition, 50 employees were released, representing an annual saving of $90,000.

Another study that is more or less typical with respect to all of the emergency agencies is that which the Bureau carried on in connection with the war information services. An analysis was made of the information agencies of the Government and of the war-information activities carried on by operating agencies. This study helped provide the necessary data for the consolidation and coordination of these activities through the establishment of the Office of War Information. Once the office was provided for, the Bureau loaned staff and carried on further studies to work out the necessary transfers, pool similar types of activities,

develop the internal organization structure, and resolve budgetary, fiscal, personnel, and similar administrative problems. As a result, what had been competitive as well as duplicating activities were eliminated, administrative overhead was curtailed, and the Office of War Information undoubtedly made much greater progress in carrying out its mission than if the experienced staff of the Bureau had not been available to give assistance.

The Bureau carried on a number of studies to facilitate more efficient administration through interagency transfer of functions and interagency coordination primarily under the First War Powers Act of 1941. Such studies led to: the transfer of rationing authority from the War Production Board to Office of Price Administration and estalbishment of the necessary organization within the Office of Price Administration; the transfer of motor-transport rationing from Office of Price Administration to Office of Defense Transportation; the transfer of all functions of the Bureau of Marine Inspection and Navigation to the Coast Guard, the Customs Bureau, and the War Shipping Administration; the abandonment of a proposal to transfer merchant marine personnel functions from the Coast Guard to the War Shipping Administration; the transfer to the Board of Economic Warfare of the functions of the Office of Export Control and of the Control Division of the State Department; transfer of the American Hemisphere Division of the Coordinator of Inter-American Affairs to the Board of Economic Warfare; clarification of the relationships of the Board of War Communications with the War and Navy Departments and the War Production Board; transfer of the physical fitness program from the Office of Civilian Defense to the Office of Defense Health and Welfare Services; and transfer of the Credit Union Section of the Farm Credit Administration to the Federal Deposit Insurance Corporation. Because of congressional concern, the need for an authoritative agency to control the use of navigable air was investigated, and as a result the Interdepartmental Air Traffic Control Board was strengthened.

A survey of the analysis of the foreign language press by Government agencies resulted in arrangements for the Department of Justice to perform this function exclusively and to service the Office of Facts and Figures and the Office of Censorship, thereby avoiding duplication of facilities.

Similarly, Bureau investigations led to a plan whereby the Coordinator of Information and the Board of Economic Warfare agreed to conduct a joint mapping service in lieu of establishing separate services,

At the direction of the President, the Bureau worked out procedures for the elimination of duplicating code-analytical activities in the several agencies and for the centralization of responsibility for this work in the War and Navy Departments and the Federal Bureau of Investigation.

Development of a separate procurement staff in the Office of Lend-Lease Administration was obviated by arranging for use of the facilities of the War, Navy, Treasury, and Agriculture Departments, and the Maritime Commission.

As a result of a survey, certain duplications of effort in the investigation of persons for subversive activity by the Federal Bureau of Investigation, War Department, and Civil Service Commission were eliminated, and certain steps were taken whereby the Federal Bureau of Investigation was recognized as the central reservoir for information of this type.

A plan was worked out whereby the National War Labor Board uses the staff of the Wages and Hours Division for initial processing of applications for voluntary wage increases and the Bureau of Labor Statistics for securing information on labor disputes.

At the request of the House Appropriations Committee, examination was made of the advantages of consolidating the microfilming activities of the Government. It was found that the savings would not be sufficient to justify the cost of establishing the new service and attendant procedures.

A study was launched of the analysis of incoming foreign radio broadcasts (received by the Foreign Broadcast Intelligence Service) with a view to eliminating as far as possible duplicate analysis by various government agencies.

A study was made for the Director of Economic Stabilization to determine the effect of present competitive methods for food procurement of the War, Navy, and Agriculture Departments, and the Veterans' Administration.

A study of the Central Administrative Services of the Office for Emergency Management is under way with a view to determining the most effective and economical way of providing these services to constituent agencies. The responsibility for determining the degree to which these services should be provided centrally or by the agencies themselves has been placed upon the Director of the Bureau of the Budget by act of Congress.

Studies leading to recommendations that will better equip agencies for solving their own organization and management problems constitute another important segment of the work of the Bureau of the Budget in facilitating greater efficiency in government operations. Because of the scope and complexity of agency administrative problems, they cannot all be solved by a central organization. It is, therefore, important to help agencies establish their own facilities for handling these matters. The Bureau promotes the establishment of organization and methods units that can help operators improve agency management and encourages the strengthening of budget offices so that the process of developing and executing agency budgets becomes a means of guiding and controlling organization, and not merely a bookkeeping process. In the past 18 months this kind of assistance has been given to Post Office, Justice, Navy, and Agriculture Departments, Army Air Forces, Civil Service Commission, and Federal Home Loan Bank Administration.

Most of the studies of agencies, however, have been concerned with general organization and operating problems. Study of housing activities and participation in the drafting of an Executive order culminated in centering all defensehousing activities in the new National Housing Agency. This move permitted more effective administration and economies in personnel, and in some measure is responsible for the fact that the National Housing Agency is proposing to spend for administrative expenses in 1944, $8,000,000 less than in 1943.

Staff of the Bureau collaborated with the Army Services of Supply in making studies of internal organization and procedures particularly in respect to ordnance, quartermaster, engineers, transportation, and fiscal problems. Improvement in the assignment of functions and internal management, and simplification in work methods has resulted.

In connection with aid given to the Assistant to the Attorney General on the organization and functions of his office, surveys of two units in the Department of Justice were made. As a result, the Bureau of War Risk Litigation was shifted to the Claims Division and the Bond and Spirits Division was abolished and its remaining functions transferred to other divisions of the Department and to the Bureau of Internal Revenue, resulting in an estimated annual saving of more than $150,000.

Recommendations were presented to the Secretary of Agriculture with respect to the organization structure and administrative methods of the Rural Electrification Administration, and the relations of the Rural Electrification Administration to borrower systems and to the Department of Agriculture.

After intensive study, a plan of internal organization for the Civil Aeronautics Administration was developed, which provided for making the deputy administrator responsible for the coordination of the administrator's program, grouping all managerial services under an executive officer, allocating all safety regulation activities to four divisions to be directly responsible to the deputy administrator, consolidating the Airport Section and the Bureau of Federal Airways into an Airways and Airport Service, and for simplifying regional organization.

A survey of the Division of Communications and Records of the State Department was made and recommendations were submitted for improvement of organization and procedures.

A study of the National Capital Park and Planning Commission is under way at the request of the President with a view to strengthening the organization and activities of the Commission as the planning agency of the Nation's capital. A recommendation to appoint a full time executive director was adopted by the President.

At the request of the Director of the Administrative Office of the United States courts, a study was made of five representative United States district court clerks' offices and recommendations were made for the Director's consideration with a view to adoption in clerks' offices generally. The matters dealt with included dockets, indexes, files, minute books, order books, microphotography of records, fiscal procedures, and case-control methods. The gradual application of the recommendations is resulting in expedition and simplification of the work of the clerks, improvement of procedures and administration, and an increase in the effectiveness of the clerks' offices.

Study was made of the need for Federal financial assistance to needy college students pursuing accelerated courses in critical occupational fields, and of the desirable outlines of a Federal program of this kind. Congress thereafter appropriated $5,000,000 for this purpose.

Another major area of Bureau of the Budget activity is the study of practices and procedures common to all agencies of the Government. Matters involving the care and use of motor equipment have received increasing attention in recent

months. The standardization of practices in changing oil was discussed in the justification; in addition a standard system for the identification of Federal vehicles to prevent improper use was worked out; agencies were informed of the proper procedure for procuring gasoline to assure exemption from State and local gasoline taxes; and study is now going on with respect to methods used in the control and servicing of Federal vehicles in the District of Columbia with view to achieving greater economies in the use of equipment.

Continuing work has been done in staggering hours of work and pay days for Federal employees in Washington to smooth out peak loads and relieve congestion. At the request of the House Committee on Appropriations, the need for legislation to control Federal office space occupancy in the District of Columbia was studied. An opinion of the Attorney General was obtained which removed existing difficulties and made further legislation unnecessary.

Progress has been made in standardizing numerous Government regulations, particularly with reference to employee travel, shipment of employee goods, provision of furniture and furnishings in Government-owned establishments, and living allowances for employees stationed abroad. Activity of this type not only promotes uniformity of policy and equity in treatment of employees but may result in substantial savings. For example, the standardization of practice on furniture and furnishings should result in a saving of $1,000,000 over a 20-year period. A study of methods of improving Federal freight traffic management developed following an expression of congressional interest and the passage of the Transportation Act of 1940 which opened the way to economies by bringing to an end land-grant deductions on civil shipments and discontinuing the audit of transportation bills by the General Accounting Office prior to payment. As a result of the survey, a central traffic service was established in the Procurement Division of the Treasury Department to provide technical traffic information to all but a few large agencies, and improved procedures were devised. The saving in personal services is about $233,000 annually. Plans were made for additional study to determine how costs might be further reduced.

Studies were conducted of the location and organization of Federal field offices, of the work of the Federal business associations and the now defunct Federal coordinating service, and of the kind of programs that should be launched to bring about greater coordination and economy in field operations.

Joint study was made with Federal agencies of means of encouraging the development and use of patents owned by the Government. A bill to achieve this purpose was introduced in Congress.

As an outgrowth of work in the War Department and the Army air forces, the Bureau has launched studies of methods of simplifying paper work throughout the Government with particular reference to such procedures as the maintenance of civil-service retirement records, preparation of pay rolls, and other personnel processes. Initial steps indicate the possibility of substantial savings in personnel. This work constitutes one aspect of the intensive program the Bureau is now organizing to carry out the mandate of the pay-increase bill for reduction of and better utilization of Federal employees. Analysis of questionnaires submitted to agencies on ways and means of bringing about such reduction and preparation of bulletins containing suggestions for agencies on effecting economies are other steps that have been taken in the course of developing a well-rounded program. Mr. DIRKSEN. I think that is all, Mr. Chairman.

Mr. Smith, I like to be very unsparing in criticism, but on the other hand I like to be very unsparing in commendation also. I note with real interest and pleasure the results of your work in investigation and coordination.

ESTABLISHMENT OF FIELD OFFICES

Mr. DIRKSEN. Also I am very happy to learn that you are setting up a field force. If anything is necessary in the Bureau of the Budget, it is that.

Mr. STARNES. I think you are doing a swell job, Mr. Smith.

Mr. SMITH. Thank you very much; and if at any time, aside from these formal appearances, you would like any additional information, we shall be glad to give it.

FRIDAY, JANUARY 15, 1943.

FEDERAL COMMUNICATIONS COMMISSION

STATEMENTS OF JAMES LAWRENCE FLY, CHAIRMAN; E. K. JETT, CHIEF ENGINEER; AND ROBERT D. LEIGH, DIRECTOR FOREIGN BROADCAST INTELLIGENCE SERVICE, ACCOMPANIED BY WILLIAM J. NORFLEET, CHIEF ACCOUNTANT; H. N. GRAVES, Jr., ASSISTANT TO THE DIRECTOR, FOREIGN BROADCAST INTELLIGENCE SERVICE; GEORGE E. STERLING, ASSISTANT CHIEF ENGINEER; AND CHARLES R. DENNY, Jr., GENERAL COUNSEL

GENERAL STATEMENT ON WORK AND ACTIVITIES OF COMMISSION

Mr. WOODRUM. We take up this morning the estimates for the Federal Communications Commission. Mr. Fly, you have a general statement you wish to make?

Mr. FLY. Yes, Mr. Chairman; I do have a prepared statement, a short one, which I should like to read. In the outset, however, I shall make just one or two general references to the over-all situation. In the first page of our justification is set forth the customary table with a comparison of 1944 and 1943 estimates. The estimate for 1944 is $8,089,600, as against the current year of $7,386,035, making a total increase of upwards of $700,000 on the face of those figures. Of the total amount for 1944, $2,019,600 is listed as regular activities, as against $6,070,000 for national defense activities.

There is projected here a small over-all decrease in the so-called regular functions, with the only net increase being in the national defense work.

I shall try to point out to the committee, as will appear more fully in the justification, that really the entire budget is a war budget and there is hardly anything we are doing of any substance there now that does not have its connection with the war and is not an essential function at this time. I should further like to invite attention to the fact that our justification this time is longer and is more explicit than usual. We have tried to give in that mimeographed justification a very complete description of all of the activities and the various problems involved, and the prepared statement which I have will parallel a part of that justification, but there will be important features of the matters set forth in the justification which I shall not touch on in my prepared statement.

The prepared justification for the Commission's 1944 estimates, which you have before you in mimeographed form, covers both our regular and our national defense requests for the fiscal year 1944. In it you will find, department by department, a justification not merely of the new items requested for the coming year, but also a justification of our continuing activities.

Many people think of the Federal Communications Commission merely as the agency which regulates radio broadcasting. Actually, this is but a small part of the Commission's work. The estimates for 1944 request less than $260,000 for this function, out of a total of