LETTER TO MR. WILLIAM E. COLBY FROM SAM J. ERVIN, JR.

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP76M00527R000700180012-2
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 6
• Document Creation Date: December 15, 2016
• Document Release Date: December 17, 2003
• Sequence Number: 12
• Publication Date: October 24, 1974
• Content Type: FORM

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 pMN L. MCCLSAM ELIJI dve~-^1A^'-'IIf^?'"?""`1 "`e 2004/01/14: CIA-RDP76MOO527ROO0700180012-2
HENRY M!JACKSON, WASH. JACOB K. DAVITS, H.Y.
FAMUND S. MUSKIE, MAINE EDWARD J. GURNEY, FLA.
ABRAHAM RIBICOFF, CONN. WILLIAM B. SAXBE, OHIO
LEE METCALF, MONT. WILLIAM V. ROTH. JR., DEL.
JAMES B. ALLEN, ALA. OILI. BROCK, TENN.
LAWTON CHILES, FLA.
SAM NUNN, GA.
WALTER D. HUDDLESTON, KY.
'S ICnff.eb zia1eZ zenc to
ROBERT BLAND SMITH. JR.
CHIEF COUNSEL AND STAFF DIRECTOR
COMMITTEE ON
GOVERNMENT OPERATIONS
October A4, 974
Mr. William E. Colby, Director
Central Intelligence Agency
Washington, D. C.
20505
Dear Mr. Colby:
Attached is a copy of a bill which has been referred to
this committee for consideration.
It will be helpful if you will give the committee the
benefit of your views regarding the provisions of this bill., and
your recommendations as to committee action.
Please transmit your reply in quadruplicate.
Thanking you for your cooperation, I am
Sincerely yours,
Sam J. Ervin, Jr.
Chairman
6e 1.40 1
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18970 Approved For Releast8Rd'RligDRhLRR 527 (A7 180012-2 October 11, 1974
eligibility for as much as a $2000 low-interest August. The Veterans of Foreign Wars be- in circulation, cannot be found. These
loan. lieves that the version agreed to by the Sen- funds are invested somewhere, and we
(d) Administrative difficulties and inequi- ate Veterans' Committee on September 26 need to know the nature and amounts of
ties.-The proposed restriction would also represents a reasonable compromise In re- such investments.
result in numerous difficulties and Inequi- sponse to the President's request. If we are to develop the policies that
ties in administration by the V.A. For exam- it is the recommendation, therefore, of
ple, joint degree or combined degree. pro- the Veterans of Foreign Wars that the Con- are needed to deal effectively with the
grams have become increasingly popular. ference Committee work for a finally-agreed implications of the "petrodollar" flows,
(These are programs in which the student Veterans Education Bill which will include we must know where these flows are
enrolls for more than the traditional four not less than a 20 per cent increase in the going.
years of college study and at the end of rates, and extending maximum entitlement, For this reason, I have introduced the
which receives both a B.A. and an advanced with no restriction, from 36 to 45 months, Petrodollar Reporting Act of 1974. It es-
degree.) Such programs have been created effective no later than September 1, 1974. tablishes a special organization under
in engineering, law, medicine, business ad- The Veterans of Foreign Wars is confident
ministration and. other fields, and section that the President will not reject such a the Secretary of the Treasury to track
1652(b) of title 38 was specifically amended compromise bill which will do justice to the petrodollars" as they are invested and
In 1970 by Public Law 91-219 to authorize Vietnam veteran and carry out -a longstand- transferred around the world. Specifical-
such programs under the term "program of Ing V.F.W. legislative goal of comparable ly, the Task Force will:
education". Any baccalaureate restriction on GI Bill assistance to the Vietnam veteran Collect and analyze specific and. de-
the nine-month extension of benefits would as was provided the veteran of World War II. tailed data on the short-run and long-
give veterans enrolled in joint degree pro- your support and vote in favor of this run use, transfer, and investment of
grams undue advantage since they generally V.F.W. recommendation will be deeply ap-
receive both their bachelor's degree and their preciated by the more than 1.8 million mem- petrodollars;
advanced degree at the end of the extended bers of the Veterans of Foreign Wars. Examine the implications of the flow
course of study, not after the traditional With kind personal regards, I am of revenue received by OPEC nations as
four years, and thus, presumably could uti-2, Sincerely, it affects the United States and the world
line the additional nine months' entitlement 1))J 010 f~.cry~ JOHN J. STANG, and consider appropriate action to deal
under the proposed amendment. (3 -~),{ Commander-in-Chief. effectively with such implications;
I also understand that the Committee Gen- ! Report to the President and the Con-
eral Counsel has been advised by the V.A By Mr. HUMPHREY: e55, not less than 4 times in each fiscal
of additional serious administrative difficul-
ties in implementing such a restrictive pro- S. 4140. A bill to establish a Task Force year, on the findings of the Task Force
vision, n Petrodollars, and for other purposes. together with such recommendations, in-
For the above reasons, I respectfully re- eferred to the Committee on Govern- chiding recommendations for additional
quest your reconsideration of this question
and that you give your strongest support . ent Operations. legislation, as the Task Force deter-
to sustaining the Senate nine-month pro- THE PETRODOLLAR REPORTING ACT OF 1974 mines necessary and appropriate.
vision intact in the Conference report. Mr. HUMPHREY. Mr. President, on The Task Force is given authority to
Sincerely, October 4, 1974, in a letter to President, hold public hearings and to issue sub-
ALAN CRANSTON. penal.
Ford, I expressed my great alarm with Mr. President, I ask unanimous con-
ExHIBIS 3 the massive and unprecedented flow of sent that my letter to President Ford be
VETERANS OF FOREIGN WARS capital that is taking place between the printed in the RECORD, along with the
OF THE UNrrED STATES, ' United States, Western Europe, and text of the Petrodollar Reporting Act
Washington, D.C., October 2, 1974. Japan, and the oil exporting nations of 1974.
Hon. ALAN CRANSTON, which are members of the organization There being no objection, the bill and
Member, of Petroleum Exporting Countries- letter were ordered to be printed in the
Committee z.CVeterans' Affairs,
Washington, , D OPEC. it is estimated by reliable sources RECORD, as follows: --
.
DEAR SENATOR CRANSTON: The membership that between $80 billion and $100 billion S. 4140
of the Veterans of Foreign Wars was literally in revenue will be transferred to OPEC Be it enacted by the Senate and House
shocked to learn that the previous Veterans nations this year from oil importing na- of Representatives of the United States of
Education Bill, agreed to by the House and tions. The United States alone will be America in Congress assembled.
Senate conferees, was rejected by the House, shipping in excess of $100 billion to these SECTION 1. (a) There Is established in
which resulted in the failure of the Congress the Department of the Treasury In the Ot-
to pass a Veterans Education Bill before the nations during the next 5 years. To look flee of the Secretary a Task Force on Petro-
fall school term began this September. at this amount in other terms, it is com- dollars (hereinafter in this Act referred to
If time was of the essence last August, it is parable to the United States sending to as the "Task Force").
that much more urgent today that the Con- the OPEC nations each year, twice the (b) The Task Force shall be composed of-
gress act to approve a bill to improve and lib- amount of gold now held in Fort Knox. (1) the Secretary of the Treasury, who
eralize veterans education and readjustment The implications of these massive flows shall be Chairman;
assistance for the millions of veterans who (2) the Secretary of State;
served during the Vietnam war. for our Nation and the world economy (3) the Secretary of Defense;
On September 26, the Senate Veterans are many and serious. Of particular im- (4) the Secretary of Commerce;
Committee agreed to. a compromise bill which portance, in my opinion, is the destabili- (5) the Director of the Central Intel-
provided: (1) a 20 per cent increase In VA zing effect on the international mone- ligence Agency;
education rates retroactive to August 1, 1974, system and on our domestic bank- (6) the Director of the Defense Intelli-
(2) extending entitlement from 36 to 45 tary gence Agency;
months, with certain restrictions; and (3) ing system of these massive capital (7) the Chairman of the Council of Eco-
authorizing a $600 a year VA education loan transfers. The administration must nomic Advisors; -
program for veterans attending high-cost promptly take firm action to develop a (8) the Chairman of the Federal Reserve
schools. comprehensive energy policy, including System; and
The imposition of restrictions on the use of specific directions which our interna- (9) such other officers of the Federal Gov-
the extended nine months entitlement pro- ernment as may be designated by the Presi-
posed by the Senate Veterans' Committee on tional oil policy should take. Before that - dent or the Chairman. -
September 26 is novel and alien to the con- effort can be made, however, it is vital (c) The Task Force shall meet at the call
cept of GI Bill assistance. The nine months' that we have complete information on of the Chairman. Task Force members shall
extention is extremely important to hun- the dimensions of the problem, including attend such meetings whenever possible.
dreds of thousands of veterans who realize the massive flow of oil revenues to the when unable to attend, a Task Force mem-
in today's world a graduate degree is Ira- ber shall appoint an appropriate alternate
perative for- making a success in civilian life. OPEC nations. from his department or agency to represent
To restrict the nine months' entitlement to Press reports have emphasized that him for that meeting.
certain veterans would be unwise, unjustified, these oil revenues-commonly referred SEC. 2. The Task Force shall-
and do grievous, possible lifetime injury to to as "petrodollars"-are being rein- (1) collect and analyze specific and de-
hundreds of thousands of veterans who vested largely in the United States. But tailed data on the short run and the long
would be otherwise entitled to such assist- these run use, transfer, and investment of for-
ance at a crucial stage in their lives. reports also emphasize that a large eign exchange earnings by oil exporting na-
The Veterans of Foreign Wars is mindful portion of these "petrodollars" cannot be tions, particularly nations comprising the
of the President's request to trim the Veter- traced. The Treasury Department ad- - Organization of Petroleum Exporting Coun-
ans Education Bill along the lines of the mits, for example, that up to 40 percent tries,
substitute bill passed by the House last of some $28 billion in "petrodollars," now (2) examine the implications of the flow
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October 11, 1974 Ste k ffl&I] SEItiTATE 18969.;
principle of "equal benefits for equal serv- least an undergraduate degree, it clearly stroig interest in the nine-months exten-
ice," which has for so long been a touch- was meant to enhance the ability of sion provision, which I had authored during
stone of the GI bill. Those veterans who many veterans to be economically and consideration of S. 2784 in June. I believe
were able to finish college with 36 months educationally competitive with their that a restriction on the nine-months addi-
of entitlement and those who left service nonveter.an peers. Limiting these addi- tional entitlement would be unwise and in-
the tee
with some or all their college training tional months of entitlement to under- equitable. of you and and I am writing our to fellow bring Committee
completed would get no added benefit for
graduate courses will prevent many vet- menebers my reasons for reaching this s Con-
oon-
their equal service contribution. Whereas erans from having the opportunity to elusion.
other veterans needing extra time to fin- compete for the increasing number of 1. Dual Purpose of New Nine Months En-
Ish college could obtain a monetary bene- jobs which require advanced courses of title meat: As stated in our Committee Re-
fit of up to $2,430-9 months by $270- education. port (No. 93-907, page 61) , the nine-month
plus eligibility for a $600 low-interest Mr. President, I ask unanimous consent provision had two principal purposes: ".. .
to insure that veterans-taking reduced
loan, that the full text of the bill and my Octo- credit loans, forced to work, and facing tech-
ADMINISTRATIVE DIFFICULTIES AND ber 2, 1P74, letter to, Chairman HARTER, nical and administrative bottlenecks-will be
INEQUITIES and the VFW's October 2, 1974, letter to able to complete their undergraduate de-
A baccalaureate restriction would also me, be set forth at the conclusion of my green . ." and to meet "the increasing pe-
result in numerous difficulties and in- remarks, node of higher education" demanded by "the
equities in administration by the VA. For The PRESIDING OFFICER. Without educational requirements imposed by em-
example, joint degree or combined degree objection, it is so ordered. Si ploycrs, state certification boards nds . . ." ,and ofe
d
programs have become increasingly pop- (See exhibits 1, 2, and 3.) restriction clearly t The pro oposed
restriction clearly removes the second pur-
ular. These are programs in which the Mr. C:E ANSTON. Finally, Mr. Presi- pose regarding the need for advanced de-
student enrolls for more than the tradi- dent, I want to stress that my view of grees in order for veterans to be competitive
tional 4 years of college study and at the inequities that will be created by the
the end of which receives both a B.A. limited 9-month extension in the confer-
and an advanced degree. Such programs ence report on H.R. 12628 which both
have been created in engineering, law, Houses passed yesterday, in no way
medicine, business administration and means I believe that bill is not deserving
other fields, and section 1652(b) of title of speedy enactment. As I said yesterday
38 was specifically amended in 1970 by to my. colleagues, that bill on the whole
Public Law 91-219 to authorize such pro- is a good one and I continue to urge Pres-
grams under the term "program of edu- ident Ford to sign it into law immedi-
cation." A baccalaureate restriction on ately,
the 9-month extension of benefits will EXHIBIT 1
give veterans enrolled in joint degree pro- S. 4139
grams undue advantage since they gen- A bill to amend chapter 34 of title 38, United
erally receive both their bachelor's de- States Code, to extend the basic educa-
gree and their advanced degree at the tional assistance eligibility for veterans
end of the extended course of study, not under c:3apter 34 and for certain depend-
after the traditional 4 years, and thus, ents under chapter 35 from 36 to 45 months
presumably could utilize the additional
9 months' entitlement under the pro-
posed amendment.
Mr. President, I also understand that
the Senate Veterans' Affairs Committee's
general counsel was advised by the Vet-
erans' Administration that such a bac-
calaureate restriction would pose addi-
tional serious administrative difficulties
in terms of implementation.
BROAD SUPPORT FOR UNRESTRICTED EXTENSION
Mr. President, In my opinion, there is
no question about the need to enact a
measure which would extend the period
of eligibility with no restriction. In addi-
tion to the thousands of letters, calls, and
telegrams my office has been receiving
over the past several months-the great
majority of which specifically have been
In support of the original version of the
9-month extension provision-my of-
fices, both here in Washington and In
California, have been swamped with
phone calls, protesting the provision,
since the restriction was adopted in con-
ference.
The Veterans of Foreign Wars, In an
October 2, 1974, letter to me urged the
elimination of the "unwise, unjustified"
restriction on the additional 9-
months entitlement. The National Asso-
of Representatives of the United States of
America in Congress assembled, That (a)
subsection (a) of section 1661. of title 38,
United States Code, Is amended by striking
out in the second sentence all after "period:
of" the second time it appears and inserting
in lieu the::eof "45 months (or the equivalent
thereof in part-time educational assist-
ance).".
(b) Subsection (c) of such section is
amended to read as follows:
"(c) Except as provided in subsection (b)
and in subchapters V and VI of this chapter,
no eligible veteran shall receive educational
assistance under this chapter in excess of
45 months."
SEC. 2. Subsection (a) of section 1711 of ti-
tle 38, Un`.ted States Code, is amended by
striking out "thirty-six" and inserting In
lieu thereo' "45".
EXHIBIT 2 +
COMMITTEE ON VETERANS' AFFAIRS,
Washington, D.C., October 2, 1974.
Hon. VANCS HARTKE,
Chairman, Committee on Veterans' Affairs,
Washington, D.C.
DEAR MR. CHAIRMAN: I understand thatat
the Executive Session of the Veterans' Affairs
Committee last Thursday, September 26,
there was a discussion of an amendment
which would restrict the availability of the
additional nine months of G.I. Bill entitle-
ment contkjned both in the Conference re-
port on H.R. 12628 and in the original Sen-
nd
t t
s
a
oraen
o that bill. As I understand
stressed its strong disapproval of any it
hepe
t
posed amendment would permit
limitation on additional months of en- the additional nine months of entitlement
titlement. to be used only by G.I. Bill trainees who
CONCLUSION
Mr. President, in closing, I would like
to stress, once again, the dual purpose
of the 9-month entitlement provision.
In addition to providing a means of in-
suring that all veterans may obtain at
had not yet obtained their baccalaureate
degrees.
Unfortunately, I was managing a bill of
vital importance to California on the Senate
floor at the time of this Executive Session
and could :lot be present. I know that you
called to the attention of the Committee my
in a job market which more and more re-
quires a master's degree rather than just a
bachelor's degree. This trend is set forth in
a recent report of the Carnegie Commission
on Higher Education.
2. Inequities and Administrative Problems:
The proposed restriction, if enacted into law,
would create gross inequities and adminis-
trative difficulties In the overall educational
assistance program. Specifically, I have the
following concerns:
(a) Unprecedented policy decision.-Never
in the history of G.I. Bill readjustment assist-
ance programs, beginning with the World
War II G_I. Bill, and including both the
Korean-Conflict G.I. Bill and the present
progr-Im, has there ever been any stipula-
tion as to the level of training-undergrad-
uate or graduate-for which G.I. Bill edu-
catioleal assistance must be used. Nor am
I aware that there has ever been such an
underlying policy. Such a baccalaureate re-
striction on any additional period of entitle-
ment would serve only to further widen the
gap between the educational benefits avail-
able ';o veterans after World War II and
the benefits currently available to Vietnam-
era and post-Korean-Conflict veterans.
(b) Discriminates against veterans with
least prior education.-Such a baccalaureate
restriction would also be highly discrimina-
tory as applied in the case of veterans leav-
ing service without any college-level train-
ing. Data on post-Korean-Conflict G.I. Bill
train?s through April of 1974 reveal that
21 percent have had one or more years of
college. No restriction is placed, nor is any
proposed, on these veterans using their G.I.
Bill entitlement for study toward advanced
degrees beyond a bachelor's degree. No such
restriction has ever been statutorily or ad-
ministratively imposed under the G.I. Bill,
Numerous veterans-including a number of
distinguished members of Congress-have
been supported by the G.I. Bill through
medicrl or law school. Yet, under the pro-
posed restriction, the 79 percent of G.I. Bill
trainees leaving service without any college-
level training-those who obviously need the
greatem:t education and training assistance
to compete effectively in this tight. selective
job mc:rket-would be denied this same ad-
vantage.
(c) Unequal benefits for equal service -
In the same way, the proposed restriction
would violate; the principle of "equal bene-
fits for equal service", which has for so long
been a touchstone of the G.I. Bill. Those
veterans who were able to finish college with
36 months of entitlement and those who left
service with some or all their college train-
ing completed would get no added benefit for
their equal service contribution. Whereas
other veterans needing extra time to finish
college could obtain a monetary benefit of
up to &2430 (9 mos. x $270) plus (possibly)
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(5ctober 11, 1974 CONGRESSIONAL RECORD - E
of revenue received from abroad by oil ex- lishment, or instrumentality (including in- We cannot develop a realistic effort to
porting nations from the sale of oil pro- telligence gathering agencies) is authorized minimize the impact of this capital flow un-the
volume of
of th such nations who are members estimates, and statist cs di ectly toe task theseefundshave they are being used.
re-
PEC
the
Countries, the organization towards
nations of such Exporting Cas s the flow of surevenue affects force upon written request made by the flrecent eets mosthclearly the urgent need for sound
ailed
a
for
and
the United States and the world and con- Chairman.
ion on
Informa
to be ap-
ith such implications; action to deal effectively propSEC. 5. ere are riated such sums&ashmay be necessary analysistof theirhimplication . At best, most
sier
w
with sueh implications;
(3) report to the President and the Con- to carry out the provisions of this Act. of our information on petrodollar flow is
gress not les's than 4 times in each fiscal SEC. 6. This Act may be cited as the "Petro- mbased atter so veducated gueses. Surelyre, this
to the
year on the findings of the Task Force to- dollar Reporting Act". m inadequtt.
gether with such recommendations, includ- OCTOBER 4, 1974. I believe that the Department of the
s nectests- - le Treasury, building on its expertise in gather-
m lag n, recom the Task F for additional
lary and as the Task Force determines The ITERHOUSE, c ing international capital flow information
SEC. 4. (a) (1) The (a) (1) The appropriate. Task Force may, for the Washington, D.C. involving domestic corporations, should ur-
purpose of carrying out the provisions of this DEAR MR. PRESIDENT: I am deeply con- gently expand its activities at once.
Act, hold such hearings as may be required cerned, as I know you are, over the tremen- Specifically, I respectfully urge you to take
for the performance of its functions under dous increase in the financial reserves of a the following steps now:
this Act, administer oaths for the purpose handful of oil producing nations and their First, immediately create a Petrodollar
and its implications. inh and out concentration
of wor d Task Force as an adjunct to the Office of the
to to anap- d profund
issue subpoenas t in any such hearings
ats sponsible to the Secretary. The Task Force
o s and tetif a compel he uc- Secretary of the Treasury and directly re-so- tiprod t on of of d oc docummeentar tary e a compel vidence el in the any any such such money
pose Serious mpose se Serious notice as
called "petrodmarko dolla la moment's
threats
hearing. Any member authorized by the to the stability and growth the world eco- would include the Secretary of the Treasury,
ople the Secreta the Secretary State, Che Secret the of De-
Task Force may administer oaths or affirms- nomic system and to the well-being of people
Fons to witnesses appearing before the Task everywhere. fense, The most reliable estimate is that oil ex- tor of the Central Intelligence , Agency, the D ec-
or2e. nations will receive up to $80 bil- Director of the Defense Intelligence Agency,
(2) Subpoenas issued pursuant bear sub sag- porting
tion (a) of this s section shall bear the rig- lion in foreign exchange earnings this year, the Chairman of the President's Council of aord-
he Chairman the
and
Econo
nature of the Chairman ofsthe Task Force largely a on design t d inary pricerncre caearningsrtel's d Fede al R serve Syst m.tThe Task Force staff
Secre .-son
direct
under
be.
would
accor
ear and,
next
each
and d may the Chairman t any Pei
the Chas sairman of the Task Force for that re iable s urces, may ytotal $500 biliongby tary of the Treasury andidrawntfrom the s
ne various agencies represented on the Task
purchase
purpose. money
every sin (3) .The provisions of section 1821 of title 19e sharoaP ughtock on the New York exchange. Force.
28, United states code, Shall apply to wit- g
nester summoned to appear r at t any such Capital movements of this magnitude- Second, instruct the Secretary of the
hearing. The per diem and mileage allow- currently equal to our entire annual defense Treausry to direct the Task Force to gather
antes of witnesses so summoned under au- budget-are totally unprecedented in world specific, detailed data on the short run and
thority conferred by this section shall be history. On an annual basis, this movement long run use, transfer and investment of
paid from funds appropriated to the Task is the equivalent of shipping seven Fort foreign exchange earnings by oil exporting
Knoxes to the oil exporting nations each nations throughout the world and to exam-
Force. year. If not controlled, such an enormous ine the implications of petrodollar flows for
(4) Any person, or who willfully qualify a flow of funds will obviously create chaos and the United States and the world and con-
refuses o to testify, refuses produce to q y havoc around the world. It could force the rider appropriate action to deal with these
witness ess in o obedience to any p subpoena duly dr to ience or any y closing of foreign exchange markets, cause Implications.
nt a
issued under authority of this section shall the bankruptcy of corporations and even Third, require that the Sof the
pe-
be fined 'not more than $500, or imprisoned nations, prevent many food importing na- Treasury direct the Task Force Secretary t report the
for not more than six months, or both. Upon tions from feeding hundreds of millions of riodi ally on the status of petrodollar flows,
the certification by the Chairman of the people, and result in a major world depres- the implications thereof, and recommends-
Task Force of the facts concerning any such situ with mass starvation and untold hu- tions for dealing with their effects to you,
willful disobedience by any person to the man suffering. and to the Congress.
United States Attorney for any judicial dis- The threat to our people and to the entire
Force I urge fully you to utilize receco tommend end that t the
he
trict in which such person resides or is world from this drastic shift in world re-Task Finally,
found, such Attorney shall proceed by in- sources must not be allowed to materialize formation gathering resources of the Amer-
rce of the including th-
son for the prosecution of such per- and its seriousness must not be underesti- fora intelligence community,
son for such offense. mated. Central Intelligence Agency and the Defense
(b) In order to carry out the functions of There are, for example, indications al- IAgency.
the Task Force under this Act, the Chairman ready that petrodollars are financing the Intelligence o term nature and
is authorized to- acgtllsition of real property by Arab nations view Importance o of f the e long-term flows, I
(1) establish, rescind, and amend such in the more prosperous industrialized na- will shortly introduce fegietroon ar establish
rules and regulations as may be necessary; tions, including resort holdings in South Force as a oermanent
,(2) appoint and fix the compensation of Carolina, apartment buildings in New York the art Pet tdorodollar Office Task of the S s atary a the
such employees a may be necessary; thCity, and office is capital appears buildings be returning to those Treasury. In the meantime, I respectfully
(3) procure temporary and intermittent to immediately establish this much
services to the, same extent as authorized by nations which have been most crippled by urge you
section 3109 of title 5, United States Code; the staggering rise in oil prices. Just as needed program by Executive Order.
(4) secure, from any executive department, alarming are rumors that 15 billion petro- Sincerely,
HUBERT H. HUMPHREY.
bureau, agency, board, commission, office, in- dollars are sloshing around the world in a-
dependent establishment, or instrumentality potentially very dangerous manner. Those
of the United States Government (including funds, capable of being quickly shifted from By Mr. HART (for Mr. MAGNU-
intelligence gathering agencies), or of any one country to another in search of ever SON) '
State, or political subdivision thereof, in- higher returns and ever greater security, are n to es-
formation, estimates, and statistics required a clear and present threat to world economic tabus. yes. 253. A joint r Commission olu ion Study
in the performance of the functions of the stability. National
task force under this Act; With these facts in mind, it is absolutely and Report on the Impact of the Inde-
(5) enter into and perform such contracts, imperative that oil importing and exporting pendent Regulatory Agencies upon Com-
leases, cooperative agreements or other ar- nations jointly develop a long-term, compre- coerce. Referred to the Committee on
rangements as may be advisable without re- hensive plan to minimize the destabilizing Commerce.
re-
gard to section 3709 of the Revised Statutes impact and economic damage to people of Mr. HART. Mr. President, at the re-
(41 U.S.C. 5) and other provisions of law petrodollar movements. I believe that an
relating naccept and use wthntheirdconsent, tessential o mountflantimstep is mediateremthe United ergency effort to the Senate Commerce shCommittee '(Mr.
with reimbursement, such services, equip- track the flow of petrodollars around the MAGNUSON) I send to the desk a Senate
ment and facilities of other Federal agencies world. It has been reported that we have Joint Resolution to establish a National
as are necessary to carry out such functions lost track of as much as 40 percent of the Commission To Study and Report on the
efficiently, and such agencies are authorized petrodollars invested since January by the Impact of the Independent Regulatory
to loan, with reimbursement, such services, oil exporting nations. From $10 to $13 billion impact
Agencies upon Commerce. I ask unan-
(b) equipment and facilities to the task force. of the $25 to $28 billion in highly liquid
y remarks Sand enator Mxt AGNUSON the
Each such department, bureau, agency, OPEC nation assets cannot be accounted for imous consent
board, commission, office, independent estab- at this time.
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S 18972 ApprovedFoof
C TCGRF S~fONAL RECORD - SENATE October 11, 197k4
resolution be printed in the RECORD at tory, dangerous, unjust and unreasonable the dates, time, and location of such meet-
this point. commercial practices or unnecessary injury; irrg is given or sent by certified mail to each
The PRESIDING OFFICER. Without Whereas the -Congress has established In- of the members of the Commission at least
objection, it is so ordered. dependent regulatory agencies from time to 30 days prior to the date thereof.
STATEMENT BY SENATOR MAGNV6ON time since 1887, "to regulate commerce with (c) DUTIES.-The Commission shall-
Mr. President, on Tuesday, President Ford foreign nations, and among the several (1) Within 12 months after Its establish-
states" by creating independent regulatory ment, prepare a comprehensive report to the
urged a "new mobilization" against inflation entities as arms of the Congress with the an- Congress and the President containing its
and proposed, among other things, the es- thority to exercise legislative and adjudica- conclusions and recommendations, together
tablishment of a National Commission on tory authority within a broad framework of wth the criteria, standards, data, and find-
Regulatory Reform to undertake an exam- Congressional standards and declaration of ings upon which such conclusions and rec-
ination of the independent regulatory policies. ommendations are based, with respect to-
agencies. He proposed that- this Commission Whereas such independent regulatory (A) the consequences to the Nation of
be composed of members of the Congress, the agencies may be imposing certain unneces- re uletion by independent regulatory
Executive Branch and the private sectorand nary burdens upon commerce which are con- agencies;
that it attempt to identify and eliminate ex- trary to the purposes of establishing such (B) the economic costs, Including any in-
isting Federal rules and regulations which agencies;
increase costs to the consumer but do not ai doervi impact upon
by chh price of goods
give the consumer any equivalentregulatory in - an e~ddWhereasress the to President of Sthe United ession o f the Con any econom affected by such regulation and
benefits, a Joint Session of the Con- any economic benefits, of regulation by the
In response to the President's request, I gress, ras called for a comprehensive study of independent regulatory agencies, Including
am introducing today a bili in the form of a the independent regulatory agencies to iden- an analysis of the relationship, if any, be-
be-
am int oduci on d yraabi a Nthe for mom- tify and eliminate existing Federal rules and tween such regulation and the degree of
mission to examine and report ational
the imps- regulations that unnecessarily increase costs market concentration, the amount of com-
com-
the independent regulatory d report the impact to the consumer by protecting the least ef- petition, and the performance characteristics
commerce,
oth n de o National Com- ficient companies subject to their regulation of industries, subject thereto, of regulation
mission to be known as the I of the and by legitimizing restrictive and anticom- by the Independent regulatory agencies, con-
con-
ghes ion Regulatory yt this Commission the petitive: trade practices that have the effect sidered collectively and individually;
higher Itsmpor eg tasks with care and the highest of increasing prices to the consumer; and. (C) any noneconomic costs and benefits
standards of accuracy and thoroughness. The Whereas, the President's recognition of the of such regulation, taking into account re-
sta of s of cura the hoough ess the need for the establishment of a National liability of service, protection of the envi-
process of appointing its members, and the Commission to examine the operation of rox,ment, protection of low- and middle-
Commission's rocess appointing operations memo not and
rue the independent regulatory agencies and to income consumers, demographic impact,
as a "pol perat football shoal n between examine the premises upon which some or quality of life, and other relevant factors game otar edrass of regulation and the fbetw n all of them were created is well substantiated and National goals and purposes as set forth
deregulation. by testimony received by the Congress, the in Acts of Congress;
It is just not that simple. For that reason, efficacy of these agencies, the accountability (D) evaluation of the benefits to the Na-
I -
It impustanot that the duly authorized reason, of these agencies to the public interest, and tion of continuing regulation by independent
Itis im of ant hat tees which hor zed Coer- the public policy justification of these agon- regulatory agencies, considered collectively
sight over the independent regulatory Gies should be studied and reviewed by qual- and individually, and costs thereof in com-
sight es, er hearin a and a art this le ry ifled and impartial individuals on a bipar- parison with the benefits to the Nation of hold g s g tisan basis, discontinuing such regulation in whole or
lation, and perform the oversight on the Now Therefore, be it in
work of the National Commission. part, and costs thereof;
The basic duties of the National Commis- Resolved by the Senate and House of Reap- (E) the consequences to the Nation of dis-
sion would be twofold. First, the Commission, resentatives of the United States of America continuing regulation by independent regu-
within one year, would be required to report in Congress Assembled, latc.ry agencies, on the same bases as set
to the President and Congress on the eco- (a) Eleta years is estabiislion forth in subparagraphs (B) and (C) hereof;
nomic and other impacts of regulation by the for a teen of f 3 3 years a National Commission and
independent regulatory agencies. The Come on Regulatory Reform (herein after referred (") the extent to which regulation by
Ine n would regulatory required agencies. ins. The the to as the "Commission"). such agencies should be continued, discon-
mpaotof would it investigate
regulations upon mar- (b) Structure-(1) The Commission shall tinned, or modified to attain the maximum
impact the inflation, ar- consist of twelve members, as follows: economic and other benefits to the Nation
ket structures, s, competition, 's and safety. ionThe (A) Three who shall be appointed by the at the minimum economic and other costs to
ployment, prices, health, TThe Majority Leader of the Senate, of whom not the Nation and its citizens, including iden
Commis o would would have e the y of r areas more than two shall be affiliated with the tification of the regulation which should be
where it to Congress and the dudu President duty eves that regulation places as same political party; continued and which should be discontinued
uhe a burden upth commerce in relation (B) Three who shall be appointed by the and on what basis;
u the beurden derived from such regulation, Speaker of the House of Representatives, of (2) Within 24 months after its establish- - fits Secon ehe Commi f ro would be required regulation, whom not more than two shall be affiliated meat prepare a second such comprehensive
with the same political party; report to the Con
to investigate and make recommendations glees and the President,
within
within two years to the Congress and the (C) Three who shall be appointed by t~de with respect to-
President
on methods t Congress the the Presiden, with the advice and consent of (A) changes in the structure, operations,
rndde on of im g th inds- the Senate, from the personnel of independ- procedures, mechanisms, and philosophy of
tort' n regulatory Commission the would a- eat Federal regulatory agencies; the independent regulatory agencies, con-
tory structure. make The
specific Commis lesson w uld and be (D) Three who shall be appointed by the sidered collectively and individually, which lative endations required to mr agency reform. The Commis- President:, with the advice and consent of would decrease any negative consequences
sien would oe required to make a third the Senate, from lists of qualified individuals of regulation to the Nation without Impair-
sion would b report required to mace years, third on the basis of their special training, experi- ing the affirmative consequences thereof;
compre within at
the end of its term of existence, on the once, or qualifications, of whom not more (B) the extent to which such changes and
than two
progress made in implementing its conclu- shall be affiliated with the same any other modifications (by statute, regula-
sions and recommendations. There have been political party. tion, rule, or practice) could improve the ef-
too many excellent National Commission (2) Members of the Commission shall be fectiiation by such agencies, considered col-
Reports which have died because of lack of appointed for a term of 3 years, except that lectively and individually, of their statutory
follow up. Regulatory reform is too important any individual appointed to fill a vacancy purposes and duties;
permit
to to permit that to happen with these Com- occurring prior to the expiration of the
recommendations, term for which his predecessor was appointed d(C) a n proposals for genies
This Commission would be composed of shall be appointed for the remainder of such and the the improving reasonable the regulatory effective-
twelve -
members, three from the executive term and in the same manner in which such ness, responsiveness, fo the efficiency, .branch, six from the Congress and three from predecessor was appointed. such h agencies, considered , and accountability collectively a ly and o-
the
the private sector. (3) The members of the Commission shall dividually, but cond in-
one of their number to serve as Chair- evaluation including, is f not limited to an
S.J. Has. 253 man thereof, otherwise es proposals for (i) merging or
-
Whereas the American consumer is en- Twelve members of the sio ent regul restructuring existing deg otitled to the lowest possible prices consistent shall constitute a quorum for the Cpf tat regulatory agencies; (11) provi ding for
shall purpose of tenure is the office of the Chairman of each
with a stable and productive economy; electing a. chairman or approving any final such agency;
Whereas there is a need to regulate com- reports required by this Ls resolution. Six of m(fin providing for some form
rrit selection recommendation prior to
merce to insure the free movement and members of the Commission shall constitute nomination of members of such agencies,
equitable distribution of safe and environ- a quorum at any meeting for the perform- such as that provided in section 202(d) of
mentally sound goods and services to protect ance of a:ay other function of the Commis- Public Law 93-236; (iv) reducing the num-
the consumer against fraudulent, discrimina- sion: Provided, That notice in writing of ber c f members or commissioners of such
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