NATIONAL EMERGENCIES ACT

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP77M00144R001100040005-4
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 15
• Document Creation Date: December 16, 2016
• Document Release Date: March 29, 2005
• Sequence Number: 5
• Publication Date: October 7, 1974
• Content Type: OPEN

c 1~3~6
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CC}N~RESSIONAL RECORD -SENATE October 7, 19 %y~
American Express cards have to keep prices
high enough to cover that company's com-
missions or 3 to 6 per cent. Gas prices have
to reflect credib-card service charges reported
as high as 7 per cent, plus the cost of bad
debts and administratpn. Take away all
those hidden costs, and we might -get a
breather in the price rise;
Credit? Good people, yae are $185 billion
in hock for TV sets and airplane rides and
other consumer stuff. We-take out $14.b bil-
lion in consumer loans everymonth, but took
out only $0.9 billion in xew mortgage loans
in the month of June. Cut back on those
consumer loans, even bri('fly, even partially,
and there would be billio~~1?s of dollars worth
of credit sloshing arouxifl to bail out the
housing industry and ex~yand factories and
create jobs and boost tie supply of goods
enough to stop inflation:'~n its tracks.
Interest? If you turx~ billions of dollars
worth of credit loose likthat, interest rates
The cost? It wouldn come out of your
pocket. You might hav to defer some pur-
chases, but take away at credit card and
you would have more oney instead of less.
Not just because you ouldn't be tempted
to buy so much, but ecause you wouldn't
be tempted to buy so ch, but because you
wouldn't have to pay much for what you
did buy. A $400 freez costs about $440 if
you pay for it over a year, $480. if you
spread the payments er two years.
The free market? T a panacea doesn't call
for credit allocators price controllers. It
might even make it p sable to get rid of the
tax breaks and gimm s by which the Gov-
ernment currently tr s to shift money into
productive investme
The poor? Because hey have the toughest
time getting credit -the first place, they
would be the least a ected by a credit-card
crunch. If it's true hat they get finagled
into ~ paying exorbit t interest rates, they
would save tho mos And let's face it, the
temptations of eas credit mean nothing
but trouble fora 1 ~ of poor people.
Restraint? You tcha. Impluse buying
would be a lot hard if you didn't have that
little plastic card ruing a hole in your
Psychology? Beca a it would affect our
buying habits so irectlg, a credit-card
crunch would do m e than a million Presi-
dential warnings t .convince us thatkthis
inflation really is a erious business.
would cut spending
men would have to c
the meantime, price
tercet rates lowered,
system would be
would be spread
and the basis woul
of prosperity. And
putting money in
taking it out.
the tools that was
vent inflation duri
n on consumer credit
much that business-
productlon and lay off
our problem is ahort-
k, industry could ex-
jobs, the free-market
eserved, the sacrifices
h reasonable fairness,
ed, successfully, to pre-
World War II. The laws
NATIdNAL EMERGENCIES AGT
Mr, MANSFIELD. Mr. President, I ask
unanimous consent that the Senate pro-
ceed to the consideration of Calendar No.
1i36, S. 3957, with the approval of the
distinguished Senator f1'om Idaho (Mr.
MC'CLURE).
The AC'CING PRESIDENT pro tem-
pore. The. bill will be stated by title.
The legislative clerk read as follows:
A bill (S. 395'7) to germinate certain au-
thorities with respect to national ernergenciea
still in effect, and to provide for orderly
implements-lion and. termination of future
national emergencies.
The ACTING PRESIDENT pro tem-
pore. Is there abjection to the present
consideration of the bill?
There being no objection, the Senate
.proceeded to consider the bill.
Mr. MATHIAS. Mr. President, I send
an ari`iendnlent to the desk.
The ACTING PRESIDENT pro tem-
pore. The amendment will be stated.
The legislative clerk proceeded to read
tine amendment.
Mr. MA'.CHIAS. Mr. Fresident, I ask
unanimous consent that further read-
illg of the amendment be dispensed with.
The ACTING PRESIDENT .pro tem-
pore. Without objection, it is so ordered.
The amendment is as follows:
Strike out all after the enacting clause
and insert in lieu thereof the following:
That this Ac;t ma,y be cited as the "National
Emergency Act".
TITLE I--TERMINATING EXISTING
DECLARED EMERQENCIES
SEC. 101. (s) All powers and authorities
possessed by the Fresident, any other a~fficer
or employee of the Federal Government, or
any Executive agency, as defined in section
105 of title 6, United States Code, as a result
of the existence bf any declaration o:[ na-
tional emergency in effect immediately prior
to one year after the date of enactment of
this Act are terminated one year fronx the
date of suclx enactment. Such termination
shall not affect-
(1) any ac;tiou taken or proceeding pend-
ing not finally concluded ar determined on
such date;
(2) any action or proceeding based on any
act committed prior to such. date; or
(3) any rights or duties that matured or
penalties that were incurred prior to such
date.
(b) For the purpose of this section., the
words "any national emergency in effect"
mean a general declaration. of emergency
made by the President pursuant to a statute
authorizing him to declare a national emer-
gency.
TITLE II-DECLARATIONS OF FUTURE
NATIONAL EMERGENCIES
SEC. 201. (a) In the event the President
finds that a proclamation of a national emer-
gency Sa essential to the preservation, pro-
tection. and defense of the Constitution or
to the common defense, safety, or well-being
of the territory or people of the United
States, the ]?resident is authorized to pro-
claim the existence of a national emergency.
Such proclamation shall immediately be
transmitted to the Congress and published
in the Federal Register.
(b) Any provisions Of law conferring
powers and authorities to be exercised dur-
ing anational emergency shall be effective
and remain in effect (1) only when the
President (in accordance with subsection (a)
of this section) , specifically declares a na-
tional emergency, and (2) only in accord-
ance with this Act. No law enacted after
the date of enactment of this Act shall atiper-
sede thLs title- unless it does so in epe:ciflc
terms, referring to this title, and declaring
that the new .law supersedes the provia;iona
oY this title.
SEC. 202. (a) Any national emergency de-
clared by the President in accordance wiith
this title shall terminate if-
(1) Congress terminates the emergency by
concurrent resolution; or
(2) the President issues a proclamation
terminating the emergency. At the end of
each year following the declaration of an
emergency which is still in effect, the Presi-
dent shall publish in the Federal Register
and transmit to the Congress a notice stating
that the emergency is still in effect. Any na-
tional emergency declared by the President
shall be terminated on the date specified in
any concurrent resolution referred to in
clause (1) of this subsection, and any powers
or authorities exercised by reason of said
emergency shall cease to be exercised after
such specified date, except that such termi-
nation shall not affect-
(A) any action taken or proceeding pend-
ing not finally concluded or determined on
such date;
(B) any action or proceeding based on any
act committed prior to such date; or
(C) any rights or duties that matured or
penalties that were incurred prior to such
date.
(b) Not later than six months after a na-
tional emergency is declared, and not later
than the encl of each six-month period
thereafter that such emergency continues,
each House of Congress shall meet to con-
sider avote on a concurrent resolution to
determine whether that emergency shall be
terminated.
(c) (1) A concurrent resolution to termi-
nate or continue a national emergency de-
clared by the President shall be referred to
the appropriate committee of the House of
Representatives or the Senate, as the case
maq be. One such concurrent resolution shall
be reported out by such committee together
with its recommendations within fifteen
calendar days, unless such House shall other-
wise determine by the yeas anal nays.
(2) Any concurrent resolution so reported
shall become the pending business of the
House in question (in the case of the Senate
the time for debate shall be equally divide
between the proponents and the opponents)
and shall be voted on within three calendar
days thereafter, unless such House shall
otherwise determine by yeas and nays.
(3) Such a concurrent resolution passed
by one House shall be referred to the appro-
priate committee of the other House and
shall be reported out by such committee to-
gether with its recommendations within
fifteen calendar days and shall thereupon
become the pending business of such House
and shall be voted upon within three calen-
dar days, unless such House shall otherwise
determine by yeas and nays.
(4) In the case of any disagreement be-
tween the two Houses of Congress-with re-
spect to a concurrent resolution passed by
bath Houses, conferees shall be promptly
appointed and the committee of conference
shall make and file a report with respect to
such conetument resolution within: six cal-
endar days after the legislation is referred
to the committee of conference. Notwith-
standing any rule in either House concern-
ing the printing of conference reports in the
Record or concerning any delay in the con-
sideration aP such reports, such report sh.ail
be acted on by both Houses not later than
six calendar days after the conference report
is filed. In the event the confereees are un-
able to agree within 48 hours, they shall re-
port back to their respective Houses in die-
agreement.
(5) Paragraphs (1)-(4) of this subsection,
subsection (b) of this section, and section
602(b) of this Act are enacted by Congress-
(A) as an exercise. of the rulemaking
power of bhe Senate and the House of Rep-
resentatives, respectively, and as such they
are deemed a part of the rules of each House,
respectively, but applicable only with respect
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October 7, 19 i~ CONGRESSIONAL RECORD - SE1~ATE
history has amnesty been as hot a political
Item as it is today. "My impression;' says
I'roi. Arthur 3. Link of Princeton University,
"is that we didn't normally have the terribly
deep feelings on both sides of the issue .. .
in the past: '
That isn't surprising. The Civil War was
unique in American history in terms of the
bitterness Americans felt for each other. And
the Vietnam War was the first time the
country's leaders attempted to wage a foreign
war ixl the face of substantial opposi"ton at
home.
?RhCEDENTS SINCE 1784
But the amnesty issue hoe generated po-
litical heat at other times as well. Consider,
for example, Woodrow Wilson's reply when
he was asked about amnesty for Eugene V.
Debs, the Socialist leader who was wiled
during World War I for violating wartime
sedition laws: "I will never consent to the
pardon of this man.... Were I to consent
to it, I should never be able to look into
the faces of the mothers of this country who
sent their boys to the other side.... This man
eras a traitor to his country." (Wilson's suc-
cessor, Warren Harding, finally pardoned
Debs and hundreds of other dissenters.)
1~he amnesty question, as Tames F. O'Nell
will tell you, also kicked up some political
dust following World War II. "The !seas
wasn't as controversial is those day ss it
is now." says O'Nell, the only surviving mem-
ber of the three-man Presidential Amnesty
'Review Board created by Harry Truman In
1948. "But there were organizations at that
time putting pressure on the White House
and Congress, and I surmise that President
Truman got exercised by this."
The 'Truman board eventually reviewed
ib,80b individual cases and recommended
amnesty for 1,b23 draft evaders, That number
was.-added to 1,b18 ex-convicts who served
at least a year in uniform and were granted
amnesty by Truman when honorably dla-
charged from the service.
Trtunan's case-by-case program was the
last of 37 separate grants of amnesty issued
by ib Presidents since George Washington
first used the President's Constitutional pow-
er "to grant reprieves and pardons." These
grants have ranged from the Civil War`
amnesties, which affected millions, to James
Madison's pardon of a band of Guli -Coast
pirates who ravaged US. shipping but later
joined the American effort during the War
of 1812.
The word amnesty derives from the Greek
smnestfa, forgetfulness. It ]s a "class action"
pardon that erases from a government's of-
ficial memory acts that are technically ll-
was granted to several thousand Pe 1-
vania farmers who had participated -the
famous Whisky Rebellion of 1794. In lain.-
ing his action, the President. eloqu y sum-
med up the spirit of the act. "Th I shall
always think it a sacred dut exercise
with firmness and energy the stitutional
powers with which I am v he wrote,
"yet it appears to me no 1 ns7stent with
the public good ... to le in the opera-
tions of Government ev degree of modera-
tice, dignity, and p may permit:'
COMPA35 V9. VENGEANCE
Sixty-eighty later, Abraham Lincoln
had more 1n d than moderation and ten-
dernesa whe~'33e offered a "fun pardon" to
most Sout}~'ners who would quit the rebel
cause anc~'sign an oath of loyalty to the
Union. c]'iie of his major aims, historians
agree, was to weaken the South's resolve to
fight.
"Of course there was a certain amount of
expediency Ln that move," says E. B. Long,
associate. professor of American studies as
the University of Wyoming and author of
several books on the Civll War era. "I happen:
to think Lincoln was the greatest Americana
human being, but you can't take the soft:,
soapy, ultrahumanitarian view of everything;
he did. lie had a war to win, for .heaven's
sake:'
Nevertheless, adds bong, Lincoln's war-
time moves were made Sn the context of hip
humanitarian plans foI restcuing the Union,
Those plans called for what has becomr3
known as the "henceforth oath," meaninr;
those who would renew their anegiance to
the Union would not be punished, But th++
Radical Republicans favored the "ironcla+l
oath," which would hays eEr;luded from th~~
governmental process anyone who hed sup-
ported the Confederate war eJort in any way,
According to Processor Long, this was on~~
of the issues at the root of the nation -
wrenching debate on Rsaonstruction, and
even 1n Lincoln's time opposition to hi s
compassionate-approach was brewing amon,
hard-line Republicans in Congress. Late,'.
after Johnson became President,- the debate
an how to deal with th.e defeated South be-
came apower struggle between the executiv
and the politically potent Congress. But them
the South.
Andrew Johnson harbored. certafa
tlve feelings of his own, though, a hesn
gave an interesting twLgt to his am
nesty program. It excluded, for pie, ah
Southerners whose net worth a ed ffi20, -
000. "Johnson was a plebe boy," . says
Long. "He r?presented the r white, th?s
small dirt farmer, the yeo class of th.~
South-and North. And I he wanted tc:+
get st the wealthy and ke them crawl i~
hours passing ment as the Southern
aristocracy pass y to plead forgiveness. "A a
far as I know ays hang, `"he never turned
down a sings tition."
Johnsoh ed another amnesty proclama-
tion on tmas Day o1 1868 that was c1osA
to a un 1 grant of amnesty for South-
erners. by this time Congress had take~~
contr i suffrage and. office-holding under
the rteenth Amendment, and Congress
ke ut 160,000 Southerners disfranchised.
N untll 1872 did Congress remove the re-
hostilities.
During the Civil War, Lincoln issued par-
dons for deserters who would retilrn to thei^
units within 60 days snd make up the tim~>
spent in resertion. Johnson Issued s similar
proclamation a year alter the war ended..
Draft evaders were nc?t prosecuted to and
significant extent, according to historian.
Long. "The draft laws were .just too loose."
But the draft laws enacted 76 years later
in the face of European turmoil were muc'x
stricter, and the number of known. Selectiv
Service violators during World War II ap-
proached 16,000 when Truman created his
Presidential Amnesty Review Board in late
1948. More than 4,300 of these-cases were Je-
hovah's Witnesses who refused both militar:%
service and alternate ctvillan service. Thy
board rejected amnesty in these cases unles>
the subjects could meet the Government`s
definition of "minister" as someone whose
service to his church was fulltime.
in addition, the board rejected amnest i
for most persons who objected to participa-
tion is the-war effort beeauie of secular be-
liefs. "We have not fei: justified," it report-
ed, "Yn recommending those who ...have
S 3~
set thelxiselves up as wiser and more compe-
tent than society to determine their duty to
come to the defense of the nation."
ii such a test were apple
James O'Neil, the board's
ber, :most of those who re
Vietnam for secular philo
Each as the war's "immor
be pardoned. "But," the
mancter of the Ameri
add, "I wouldn't wan
for deciding amnest
nom 'War."
That task will. 1
Yresi?dential Cle
minLs'ter the
$mnesty to V
firm their al
serve up to
many of
though,
At a r
Toros
assn
esp 1
Th
u e
A7' LAST, A PANACEA FOR OUR
ECONOMY
M~?. MANSFIELD. Mr. President, I
have an article from the National Ob-
servc~r of October 12, 1974, under "Ob-
servations," entitled "At Last, a Panacea
for Our Economy," by MichaeLT. Malloy.
It has to do with the huge extension of
credit in this country. It is a most worth-
while article. I ask unanimous consent
that it also be printed In the RECORD.
TYiere being no objection, the article
was ordered to be printed in the RECORD,
as fc~llows:
AT LAST, A PANACEA FOR OII$ ECONOMY
(By Michael T. Malloy)
Tha economic summitry of recent weeks
churned up a tidal wage.oi conflicting advico
on how to handle inflation, but no panacea.
I have the panacea.
Bei'ore unvelling it, though, let's look at
what the economic aummiteers Were trying
to de., whg they gave conflicting advice, and
what the areas are in which they actually did
agree.
What they (and the rest of us) want is to
check the rise iII prices, reduce the rate of
interest, and divert mole credit toward build-
ing ]louses and expanding industrial pro-
duction.
They (and the rest of us) disagree on how
to do? this because we don't want the cost to
fall on our own pocketbooks. Business doesn't
want profits hurt; labor. doesn't want to sac-
rifice income. Also, traditional economists
don't want the free market messed up by
price controllers and mandatory allocation of
credit. But liberals fear that the traditional
free-market medicine, which means cutting
Gove:rnmellt programs and boosting unem-
ployrnent, would hit hardest at the poor.
There is agreement, though, that we should
all fight inflation together by showing re-
straint in the way we spend money and some-
times waste it. And a let of econon fats and
officials wish for something dramatic (an-
nther boring Presidential speech?) to get
public phychology ready to make moderate
saeri~ices.
Okay: here is the panacea. Stamp out credit
cards, sock it to the charge accounts, crack
dowr+ on go now-pay later. Not overnight
mayk+e, and not 100 per cent, but enough
to p~xsh our buying habits back to where
they were, say, a decade ago.
Prices? All that easy credit is added to the
price of the stun you buy, whether you use
the ?credit or not. Merchants .who accept
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'Qct~be-r 7, Y 97.E CONGRESSIONAL RECORD -SENATE
to the procedure to be followed in the House
in the case ai resolutions described by this
subsection; and they supersede other rules
only to the extent that they-are inconsistent
therewith; and
(B) with cull recognition of the constitu-
tional right of either House to change the
rules (so far as relating to the procedure of
that House) at any time, in the same man-
ner, and to the same extent as in the case of
any other rule of that House.
TITLE III-DECLARATIONS OF WAR BY
CONGRESS
$EC. 301. Whenever ..Congress declares war,
any provisions of law conferring powers and
authorities to be exercised during time of war
shall be effective from the date of such dec-
laration.
TI'T'LE IV-EXERCISE OF EMERGENCY
POWERS AND AUTHORITIES
SEC. 401. When the President declares a na-
tional emergency no powers or authorities
made available by statute for use in the event
of an emergency shall be exercised unless
and until the President specifies the pro-
visions of law under which he proposes that
he, or other officers will act. Such~speciflca-
tion may be made either in the declaration of
a national emergency, or by one or more con-
temporaneous or subsequent Executive orders
published in the Federal Register and trans-
mitted to the Congress.
TITLE V-ACCOUNTABILITY AND RE-
PORTING REQUIREMENTS OF THE
PRESIDENT
.S'EC. b01. (a) When the President declares
a national emergency, or Congress declares
war, the President shall be responsible for
maintaining a file and index of all significant
orders of the President; including Executive
orderq and proclamations, and each such Ex-
ecutive agency shall maintain a file and index
of all rules and regulations, issued during
such emergency or war issued pursuant to
such declarations.
(b) All such significant orders of the Pres-
ident, including Executive orders, and such
rules and regulations shall be transmitted to
the Congress promptly under means to assure
confidentiality where appropriate.
(c) When the President declares a national
emergency or Congress declares war, the Pres-
ident shall transmit to Congress, within 30
days after the, end of each 3-month period
after such declaration, a report on the total
expenditures incurred by the United States
Government during such 3-month period
which are directly attributable to the exer-
cise of powers and authorities conferred by
such declaration, Not later than 30 days after
the termination of each such emergency or
war, the President shall- transmit a final re-
port on all such expenditures.
TITLE VI-REPEAL AND CONTINUATION
OF CERTAIN EMERGENCY POWER AND
OTHER STATUTES
SEC. 801. (a) Section 349(x) of the Immi-
3ration and Nationality Act (8 U.S.C. 1481
(a)) is amended--
(1) at the end of paragraph (9) , by strik-
ing out "; or" and inserting in lieu thereof
a period; and
(2) by striking out paragraph (10).
(b) Section 2687(b) of title 10 of the
United States Code is amended-
(1) by inserting "and" at the end of para-
graph (3);
(2) by striking out paragraph (4); and
(3) by redesignating paragraph (6) as (4).
(c) The Joint resolution entitled "Joint
Resolution to authorize the temporary con-
tinuation of regulation of consumer credit",
approved August 8, 1947 (12 U.S.C. 249), is
repealed.
(d) Section 6(m) of the Tennessee Valley
Authority Act of 1933 (18 U.S.C. 831d(m) )
is repealed.
(e) Section 1383 of title 18, United States
Code, Ls repealed.
(i) Section 8 of the Act entitled "An Act
to amend the Public Health Service Act in
regard to certain matters of personnel and
administration, and for other purposes", ap-
proved February 28, 1948, 9s amende.d by
striking out subsections (b), (c), (d), (e),
and(i) (42U:i.C.211b).
(g) Section 9 of the Merch;mt Ship Sales
Act of 1948 (60 U.S.C. App. 1742) is repealed.
(h) Thia section shall not affect--
(1) any action taken or proceeding pend-
ing not finally concluded or determined at
the time of repeal;
(2) any action or proceeding based on
any act comrriitted prior to xepeal; ar
(3) .any rights or duties that matured or
penalties that were incurred prior to repeal.
Sec. 802. (a) The provisions of this Act
shall not apply to the following provisions
of law, the powers and authorities conferred
thereby, and actions taken, thereunder:
(1) Section b(b) of the Act of Octciber
8, 1917, as amended- (12 U.S.C. 9b (a); 60
U.S.C. App. 6 (b)) ;
(2) Section 873 o:C titlo 10, United StEbtes
Code;
(3) Act ofApr1128,1942 (40 U.S.C.278b)~;
(4) Act of June 30, 1949 (41 U.S`C. 2b2) ;
(b) Section 3477 of the Revised Statutes,
as amended (31 II.S.C. 203);
(8) Section 3737 of the Revised Statutes,
as amended (41 U.E>.C. 16).
(b) Each committee of the House of R,ep-
resentatives axLd the Senate having Jurisdic-
tion with respect to any provision of law
referred to in subsection (a)(1)-(8) of this
section shall make a complete study and in-
vestigation concerning that provision of law
and, make a .report, including any recom-
mendations and proposed revisions it may
have, to its respective House of Congrress
within 270 days after -the date of enact-
ment of this Act.
Mr. MATHIAS. Mr. President, I offer
this amendment in behalf of my distin-
guished colleagues and cochairman of
the Special Committee on National
Emergencies and Delegated Emergency
Powers (Mr. CHURCH) , and in behalf of
the members of i;he special committee-
Mr, HART, Mr. CASE, Mr. PEARSON, Mr.
PELL, Mr. S7'EVENSON, and Mr. HANSEN.
Very briefly, some of these are amend-
ments which have been suggested in be-
half of the President by the Office of
Management and Budget. They make
certain technical changes i.n the bill as
it was originally approved by the Spe-
cial Committee, and thereafter approved
by the Committee an Government Op-
erations. They have been cleared adth
the distinguished rhairrnan of the Com-
mittee on Government Operations (Mr.
ERVIN).
What they do is very simple. They ex-
tend the grace period provided in the bill
from 9 months to a year.
'T`hey provide. that while Congress can
terminate a national emergency at any
time by concurrent resolution, there ?will
be no automatic termination aftel? 6
months if there is no affirmative action.
This has been replaced by a require-
ment for the Congress to meet every 6
months to consider whether to terminate
an emergency. An expedited privileged
procedure would assure consideration
and a vote should the Congress so decade.
We have reduced the list of statutes
to be repealed. In working with the other
body, partially. as a result of special
committee studies, most of the provi-
sions that have been deleted from our
original ]1st are to be taken care of in
various deadwood projects by the Codi-
S 18357
flcation Committee of the House of Rep-
resentatives.
There are six statutes which are to
be exempted from the provisions of this
act. These statutes include Trading With
the Enemy Act, a Ready Reserve provi-
sion, purchasing contract lease and
claims authorities believed by the execu-
tive branch to be absolutely essential
for the operation of government. There
is a requirement that the committees
with jurisdiction over these provisions
must make a study and report recom-
mendations within 9 months about
modifications- or any other changes to
be made.
Finally, the requirement far account-
ing of expenditures incurred under the
authority of emergency powers statutes
suggested by Senator MCCLELLAN has
been included.
Mr. President, over 2 years ago, the
Senate created the Special Committee on
the Termination of the National Emer-
gency to examine the state of national
emergency the United States was operat-
ing under and to make recommendations
of how to best terminate the emergency
and to provide for a regular and con-
sistent procedure by which future emer-
gencies could be met.
Soon after the bipartisan committee
composed of four Democrats and four
Republicans, with cochairmen one from
either party, began its work it was evi-
dent that there were four states of na-
tional emergency in force and not just
fine as many in the Congress had as-
sumed. The national emergency declared
by President Franklin D. Roosevelt in
March 1933 to meet the problems of. the
Great Depression has not yet been
terminated.
The national emergency declared by
President Truman in December 1950, to
better prosecute the Korean conflict, is
still in force. The national emergency
proclaimed by President Nixon on
-March 23, 1970, to handle the Post
Office strike, and the i4ugust 15, 1971,
national emergency to meet balance of
payments and other international eco-
nomic problems of that time are still
in force.
A majority of the people of the United
States have lived all of their lives under
emergency Government. For four decades
normal constitutional processes have not
been the rule. The wars, emergencies, and
crises of various kinds of the past 40
years, in addition to the growth of the
executive branch bureaucracy under the
leadership of strong Presidents, and the
diminished role of the Congress in the
making of policy-these factors have a,ll
contributed to the erosion of constitu-
tional government. `'
There is na valid reason for emer-
gency rule to continue. We are not at
war anywhere in the world and there
are no other conditions that requires the
continued existence of a state of national
emergency. Our Government would be
strengthened by bringing to an end all
states of national emergency now in
existence, and this termination should
take place as soon as possible.
One course of action that seemed at
first to be the simplest solution; namely,
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to end the existing states of emergency
foz~thwith and to repeal all emergency
statutes was re3ected by the special com-
mittee after intensive study, because it
was clear that such drastic action could
cause serious disruption of governmental
processes. Same of the departments and
agencies have used emergency authori-
ties as basic everyday law. In the view of
the special committee it would be unwise
to abruptly halt these operations without
providing a reasonable period of time to
make a transition from emergency law
to permanent law.
An example of this everyday use oP
emergency authority is the sa-called sec-
tion 5 (b) of the Trading With the Enemy
Act. 'this provision which dates back to
World War I and 1917 has been in con-
stant use as a means to regulate many
aspects of foreign trade and international
manetary controls. Partially because of
the prospect that the states of national
emergency would be terminated, the
Treasury Department has already begun
to adjust to doing its business without the
broad open-ended authorities contained
hi the section 5 (b) provisions. The spe-
cial committee has taken into account
the need for a period of time to make the
adjustment with the least possible dis-
arrav. For almost 2 years the Treasury
Department has been aware that the
states of national emergency would be
terminated. The germane committees are
aware of the problem. The committees
of Congress with assigned jursidictions
and the executive branch agencies should
property decide through the regular leg-
islative process the provisions of any new
or modified legislation. In order to assure
an orderly transition, the special com-
mittee's view that a grace period of 1
year after date of enactment should b?
given to the executive branch has been
incorporated in the legislation now be-
fore the Senate.
Section 602(a> of the bill now before
the Senate contains six provisions of law
which the executive branch has strongly
urged continue in force. The special com-
mittee has concurred in this request. Sec-
tion 602(b) would require the standing
committees with jurisdiction over these
statutes to study provisions and make a
report to the Senate which would include
recoinrnendations and ar>,y proposed re-
visions. Asimilar process would be under-
taken by the germane committees in the
House. With the informed awareness now
available to both the legislative and-ex-
ecutive branches of provisions of law that
have been used to meet emergency situa-
tions, it is reasonable to assume that
some modiflcatians will be made in some,
if net all of the statutes contained in sec-
tion 601 after further study in the coming
9 months by both the executive branch
and the committees of the Congress. In
the view of the special committee the
most eiiective way to resolve this kind of
outstanding issue can best be done by
the two branches working through the
regular legislative process. But the bur-
den to remove these exceptions lies most
heavily upon the Congress.
The special committee wanted to be
certain that the executive branch of the
U.S. Government would have the proper
legal authority to act effectively to meet
any future emergencies. To this end, tI-_e
special committee asked every Depar?u-
ment and agency of the executive bran.~~h
and every standing, committee of t':e
Senate to evaluate the emergency pat~`-
ers statutes now in Force as to their utl-
ity for use in any future emergency. Tt:s
evaluation provides the basis for the r~:-
pea.ler section of the National Erne.?-
gencies Act, section 601. The statutes
contained therein are considered obs l-
lete byboth the executive branch age~;-
cies and by the committees. There is no
disagreement between the branches that
these obsolete provisiazts should be r:?-
pealed..
Thero are other statutes among t`.ae
47o statutes that the respective standitQ
committees may wish to repeal or ma.ta-
ber 6, 1817, as amended, are hereby approved
and oonfirme(l." (48 Stat. 1; 12 U+3.C. 9bb
(1970)). Can@;ress thus"spread its protec-
tive agpmval over executive acts the lega,llty
of which wan uncertain." Ellir~gwood, 07~, cit.
supra at 27 N'w. U.L. Rev. 929 (1933). Con-
gress also amended Section b(b) to provide,
among other filings, that "[d]uring times of
war or during~ any othe?' period of national
emergenep declared by the President, the
President map ...regulate, under such rules
and regulations as he Inap prescribe ,
transfers of Credit between ar paymente~ by
banking institutions as defined by the
President...." 48 Stat. 1. In the enactment
clause Congress _ deohared "?that a serious
emergency exists." 48 Stat. 1: The exclu:aian
M domestic ta~ensaotions, formerly iovnti in
the Act, was deleted from ? 6(b) at this
time.
The legislative history of the Emergency
Banking Act is short; only eight hours
elapsed from the tAme the bill wen intro-
duced untll St was signed into law. There
were no committee reports. Indeed, tie blll
wan not even In print at th.e time lt, was
passed. 77 Cang. Rec. 76, 80 (1933); Schles-
inger, The Coming of the Ne2o Deal 8.
The abbreviated history shows Congress
recognized that the powers conferred on the
President by the Act were great. In the de-
bate precedin{; the bill's passage those sup-
porting it msaie such remarks as:
? in time of storm there can only be
one pilot. In my judgment, the Houses of
Representatives realize that the pllot in this
case must be the President of the United
States, anal they will steer their course by
him (Rep. C+o'klsborough, 77 Cong. Rec..Bl),
"It is a dictatorship over finance is the
United States. It is complete control over the
banking system in the United Staten. (lisp.
Mcl'adden, .77 Cong. Rec. 80) .
"I realize that in time of peace we have
perhaps never been called upon to vest such
transcendent powers Sn the Executive a9 are
provided for in this bill.... It is an ewer
genep which can bo adequately dealt vnth
only by the siaong arm of Executive power,
and therefore I .expect to vote for the bill,
though it contains grants of powers which
I never before thought T waLlld approve in
time of peace." (Sen. Connally, 77 Cong. l;!,ec.
6b).
The courts later upheld the validity of the
bank holiday under the Act as amended,
13.g., Smith v. Witherow, 102 F.2d 638, 641
(3d Cir., 1939); Hardee v. Wash.i~agton Loan
~ Trust Co., 9 L F.2d 314 (D.C, Cir. 1937) . Be-
cause of the prompt action taken by Con-
gress in ratifying the March 6 proclamation,
no judidal decisions were rendered on the
S 183~i
question of whether the President's action, if
taken alone, would have been laivKul.
Subsequently in 1933-34, acting under ? 5
(b), President Roosevelt issued a series of
orders which prohibited the hoarding of gold
and directed that all gold bullion certificates
be deposited with the Federal Reserve Santis
and which regulated transactions in foreign
exchange:.
(1) Executive Order 6073 of March 10,
1933, prohibited the export or removal of
gold from the United States, except as au-
thorized by the Secretary of the Tresaury,
and banks were prohibited from making
transfers of foreign exchange except in con-
nection 'with certain described transactions.
Thin order did not specifically refer to a na-
tional emergency.
(2) Executive Order 6102 of Aprll b, 1933,
generally required holders of gold coin, gold
bullion, and gold certificates to surrender
their holdings to Federal Reserve Banks. Thin
Order stated "Bp virtue of t'he authority
vested in me by Section 6(b) ... as amended
by Section 2 of the Act of March 9, 1933, .. .
in which amendatory Act Congress declared
that a serious emergency exists, I ... do de-
clare that said national emergency still con-
tinues to exist "
(3) Executive Order 6111 of April 20, 1933,
authorized the Secretary of the Treasury to
regulate transactions is foreign exchange
and the export or withdrawal of currency
from the United States. The emergency basin
for E.O. 6111 was stated in the same lan-
guage as the language o2 E.O. 8102, quoted
immediately above.
(4) Executive Order 6260 of August 28,
1933, was issued to supplant Executive Orders
6102 and 6111. This order prohibited the
holding or export of gold, except under
license issued by the Secretary of the Treas-
ury, and authorized the Secretary to regu-
late or prohibit transactions in foreign ex-
change. Ia E.O. 6260 the President stated
"I ... do declare that a period of national
emergenep exists." Executive Order 6260 was
confirmed and amended by Presidents Eisen-
hower and R:ennedy. 31 CFR Part b4. See 42
Op. A.C}. No. 3b, p. 9.
(b) Executive Order BSBO of January 15,
1934, authorized the Secretary os the Treas-
ury to regulate transactions in foreign ex-
change, transfers of credit from American
? to foreign banks and export of currency or
silver coin. This order is still on the books
today. See. 31 CFR Parts 127-128. In thin
Order, the President declared that "a period
of national emergency continuos to exist."
In January 1934 Congress ratified all acts
which had been performed under the Emer-
genep Banking Act. 48 Stat. 343 (1934); 12
U.S.C. 213 (1970).
III. WORLD WA$ II ALIEN PROPERTY FREEZE
Following the invasion of Norway and Den-
mark by C+ermany !n Aprll 1940 :President
Roosevelt acted to protect funds of residents
of these countries in the United States from
withdrawal under duress by issuing an or-
der freezing those assets except as authorized
by the Secretary of the Treasury. Executive
Order No. 8389 (April 10, 1940). The order
referred to authority under ? 6(b) but did
not specifically mention the existence of a
national emergency. The President had pro-
claimed anational emergenep only months
before in Septembr 1993; Proclamation No.
2352 noted the neutrality of the United
States iIi the war and stated:
"Whereas measures required at this time
call for the exercise of only a limited num-
ber of the powers granted in a national emer-
gency:
"Now, therefore, I ... do proclaim that a
national emergency exists in connection with
and to the extent necessary for the proper
observance, safeguarding, and enforcing ai
the neutrality of the United States and the
strengthening of our Rational defense within
the limits of peacetime authorizations:'
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Subsequently on May 7, 1940, Congress
passed a resolution "to remove any doubt"
that ? 5(b) authorized certain aspects of the
freeze order. The Report of the Senate Bank-
ing Committee noted that when Congress
passed the Emergency Banking Aet, "it in-
tended to grant to the President all of the
powers conferred upon him by section 6(b)
of the Act of October 6, 1917, and to author-
ize him to exercise all of such powers not
only in time of war, but during any other
period of national emergency." S. Rep. No.
1496, 76th Cong., 3d Sess. 1 (1949). By )Dint
resolution, Congress thus approved and con-
firmed the order and amended ? 5(b) to
clarify the President's freeze power over alien
property. b4 Stat. 179 (1940). See United
States v. Von Clemm, 136 F. 2d 968, 970 (2d
Cir. 1934), cent denied, 320 U.S. 769 (1943)
uplolding the retroactive validity of the 1940
point resolution of Congress) .
The original freeze order was an amend-
ment to Executive Order No. 6560 of Jan-
uary 1934 regulating foreign exchange and
the export of coin and currency and the con-
trols were somewhat similar to those exer-
cised during the First World War and during
the banking crises of 1933. This order, cover-
ing Norway and Denmark, was followed by
similar executive orders after other nations
were invaded or subjected to Axis domino-
tion. Eventually Germany, Japan and Italy
were themselves covered in June and July
1941. The purpose of the orders was to keep
the Axis from using billions of dollars of
assets in the United States. Roosevelt Papers
(1940 vol.), p. 133-34. Regulations issued by
the Secretary of the Treasury, pursuant to a
general delegation of Presidential authority
under ? 6(b) made in 1942, continue to this
date to serve as the basis for blocking trade
and financial transactions with North Korea,
Cuba snd North Vietnam. See 3L C.F.R, part
b00 et seq.; Executive Order 9193, sec. 3,
July 6, 1942, 7 Fed. Reg. 520b, and Executive
Order 9989, Aug. 20, 1948, 13 Fed. Reg. 4891.
IV. CONSUMER CREDIT CONTROLS
Four months before the United States
entered World War II, President Roosevelt is-
sued Executive Order No. 8843, which directed
the Federal Reserve Board to impose con-
sumer installment credit controls as a meas-
ure to fight inflation. 6 Fed. Reg. 4036 (1941).
The order was issued on August 9, 1941, under
? 5(b) "in order, irx the national emergency
declared by me an May 27, 1941 to promote
the national defense and protect the national
economy.. : ' B Fed. Reg. 4035 (1941) . On
May 27, 1941, the President had issued Proc-
lamation No. 2487 which proclaimed that
"an unlimited national emergency con-
fronts this country, which requires that its
military,-naval, air and civilian defense be
put on the basis of readiness to repel any and
all acts or threats of aggression directed
toward any part of the Western Hemisphere."
In Executive Ordei 8843 the term "banking
institution" as used in ? b(b), was defined to
include any person engaged in the business of
making extensions of credit whether as a
vendor of aonsumer durable goods or other-
wise. The Federal Reserve Board was author-
ized, in order to prevent evasion of the_arder,
to regulate any other extension of install-
ment credit, any credit for the purpose of
purchasing or carrying any consumers' dur-
able good or any other extension of credit
in the corm of a loan (other than loans to
businesses or agxRcultural enterprises). 6
Fed. Reg. 4036.
There was some suggestion at the time
that the definition of banking institution to
include vendors of "consumer durable goods"
was beyond the power conferred by ? b(b).
One writer noted that the President had
"disclosed hitherto unsuspected potential-
ities" in ? 6(b) by using this definition of
banking institutions and that a clearer stat-
utory basis would be desirable for such con-
trols. Note, Federal Regxclation o} Consumer
Credit by Executive Order. 41 Colum. L. Rev.
1287, 1289 (1941). See also Price Control
Bilt, Hearings on H.R. 5478 before the House
Banking and Currency Committee, 7'lth
Cong., 1st Sess., pp. 118-117 (1941) . Never-
theless, the controls were accepted-once the
order was issued and never challenged in
court. In December 1941 Gongress passed the
First War Powers Act (56 Stat. 839) which
included a provision approving and ratify-
ing actions which had ben taken under ? 6
(b), thus apparently approving Executive
Order No. 8843.
After World War I1, Congress an four oc-
casions took legislative action concernlug
imposition by the Federal Reserve Board of
consumer credit controls pursuant to ? b(:~).
The four actions by Congress are as fol-
lows: -
/,l) The Congress passed a joint resolution
in 1947 which provided that after November
1, 1947, the Federal Reserve Board was not to
exercise consumer-credit controls pursulnt
to Executive Order No. 8843. 61 Stat. $21,
12 U.S.C. 249. The joint resolution also pro-
vided that no "such consumer credit ar:u-
trols" could be exercised except during war-
time or any national emergency thereaf~er
declared by the President.
7'he legislation took this form because
President Truman had decided to place #_ne
issue of the continuation of controls "in
the laps of Congress" rather than. rescind the
controls himself by revoking the Executive
order. 9:3 long. Rec. 97b7. The legislative
history oP the 1947 resolution shows that
Congress intended that the President have
the power, ii needed, to make ouch controls
effective against the day after the resolution
by declar)ng a new national emergency.: ee
98 Cong. Ree. 97b3, 9758-69.
12) On August i6, 1948, Congress chanied
its policy and authorized the Federal Re-
serve Board, "notwithstanding" the 1047
joint resolution, to exercise `?consumer-crc d-
it controls in accordance with and to carry
out the .purposes of" Executive Order No.
8843. 62 Stat. 1291.
The legislative hLtory of thr> 1948 a?~t
again affirms congressional intent that the
PrECSident retain his authority under Execu-
tivo Order No. 8843 to exercise consumer
credit controls thereafter during time of war
or national emergency. It also made clear
that he could have reimposed them on his
own without-the 1948 resolution. The House
report noted:
"When the Congress terminated the con-
trols over consumer credit pursuant to the
provision of [12 U.S.C. 249), it speciflcaay
provided that such tl:rmination~ did not af-
fect the authority to reimpose such controls
during the time of war or any national eme?r-
geney declared by the President. The Presi-
dent has evidently not seen fit to use fiefs
authority to reinstate the regulation of con-
sumer credit and henceforth the committee
proposes ixr this joint resolution for ean-
gressional enactment of such powers for a
temporary period with respect to consumer
installment credit and at the same tixi~e
reserve the authority to exereLse consumer?-
credit controls thence*_'ter during the time of
war or declaration of any national emer-
gency by the President H.R. Rep. No. 2455,
80th Cong. 2d Sees. b--6 (1948).
The 1948 authority expired June 30, 1949.
(3) In ?801 of the Defense Production Act
of 1950, using Ianguage patterned closely on
that of the 1948 enactment, Congress again
gave the Federal Reserve Board authority to
exercise consumer credit controls under Ex-
ecutive Order No. 8843 "notwithstandinga"
the 1947 joint resolution. 04 Stat.812.
(4) In June 19b2, while extending other
parts of the act, including ? 602, Congress
repeatel ? 601. 66 Stat. 30b. Repealing ? 6^1
appeared to restore the provisions of the 1947
joint resolution (12 U.S.C. 249) authorizing
the impositions of consumer credit contxds
again during a war or a period of national
emergency.
'V. FOREIGN DIRECT INVESTMENT PROGRAM
Section b(b) was also used as aurhority
for the Poreign Direct Investment Program
in L968. Under E.O. 11387 of January 1, 1968,
cor.~trols were imposed by President Johnson
over transfers of capital to foreign countries
by substantial investors in the United States.
A :formal opinion was issued by Attorney
General Ramsey Clark upholding the pro-
gram, The opinion reviews the history of
? 61;b). It also discusses the continuation of
the national emergency declared by Presi-
dent Truman in Proclamation 2914 of Decem-
ber 16, 1950, which referred to the hostilities
in ]Korea and the world menace of the forces
of communist aggression. 42 Op. A.G. No. 35.
The order relies on the continuation of this
emergency.
I:n March 2, 1973, a federal district court
judge ruled orally that ? 5(b) did not au-
thorize an indictment charging a violation of
the Foreign direct investment program. The
exi.~tence ai a national emergency was not
raised, however. An appeal is now being pre-
pared. United States v. Ryan, Crim. No. 2038-
78 (D.D.C. 1973). E.O. 11387 contim.tes in
effect today.
VI. ExPORT CONTROLS
most recently, ? 5(b) was used for a month
ixx 1972 when it was invoked by President
Nixon as authority for the regulations of
exports. E.O. 11677 of August 1, 1972. Section
5(b) was used 3rx this situation because the
existing law authorizing export_cantrois, the
Export Administration Act of 1969, 83 Stat.
841, as amended by 86 Stat. 133, had expired.
When export control legislation was re-en-
acted, E.O. 11877 was revoked by E.O. 11683
of August 29, 1972.
T11e executive order imposing controls re-
cited the continued existence of the national
emergencies declared by Proclamation No.
2914 of December 16, 1950, referred- to above,
andl by Proclomation No. 4074 of August 15,
1971, which imposed a supplemental duty
on imports for balance of payments purposes.
on imports far balance of payments pur-
poses.
5O U.S.C. APP, 5. SUSPENSION OF PROVISIONS
RELATING TO ALLY OF ENEMY; REGULATION
OF TRANSACTIONS ZN FOREIGN EXCI3ANGE OF
GiOLD OR SILVER, PROPERTY TRANSFERS,
VESTED INTERESTS, ENFORCEMENT AND PEN-
A:LTIE9
(a) The President, if he shall find it com-
patible with the sa}ety o} the United States
and with the success}ul prosecution of the
war, may, by proclamation, suspend tlae pro-
visions o} this Act (sections l to 6, 7 to 39
and 41 to 44 of this Appendix] so far as they
apply to an ally of enemy, and he may re-
voke or renew such suspension from time to
time; and the President may grant-licenses,
special ar general, temporary or otherwise,.
and for such period of time and containing
suc;a provisions and conditions as he shall
pre:scribe, to any person or class of persons
to do business as provided ixr subsection (a)
of section four hereof [section 4(a) of this
Appendix], and to perform any act made
unlawful without such license in section
thrEOe hereof [section 3 of this Appendix].
and to file and prosecute applications under
subsection (b) of section ten hereof [section
10(1>) of this Appendix]; and he may revoke
or renew such licenses from time to time, if
he shall be of opinion that such grant or
revocation or renewal shall be compatible
with the safety of the United States and
witlx the successful prosecution of the war;
and he may make such rules and regulations,
not inconsistent with law, as may be rxeces-
sary' and proper to carry out the provisions
of this Act [sections 1 to 6, 7 to 39 anal 41
to 9:4 of this Appendix]; and the President
map exercise any power or authority con-
ferred by this Act [said sections] through
such officer or officers as he shall direct.
If the President shall have reasonable cause
to believe that any act is about to be per-
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_ _. . ? ,... .-?.~,,.Tr* n t' c c rnr.T e T 7P T. x(112 3'1._-_ C~F.N t~'I'E
formed. in violation of die] heh~all have hereby lconfewrrecl,ototPrescr bed imm lime to
[section. 3 of thin Apl~ nement of the time, definitions, not inconsistent with the
authority to order the postpo
performance of such act far a period not ex- purposes of this subdivision, for any or all
ceeding ninety daps, pending investigation of the terms used in this subdivision. Who-
of the facts by him. over willfully violates any of the provisions
(b) (1) Duri~ tohentaii emergency de- rulehor sreguloltiolri issuedatbereuna r,oshall
any other pert 1
Blared by the President, the President may, upon connection, be fined not more than'
through any agency that he may designate, C?10,000, or, it a natural person, may be im-
or otherwise, and under such rules and raga- prisoned for not more 'than ten pears, or
lotions as he may Prescribe, by means of both; and any officer, director, or agent of
instructions, licenses, or otherwise-- any corporation who knowin-gip participates
(A) investigate, regulate, or prohibit, any in such violation may be punished by a like
transactions in foreign exchange,- transfers fine, imprlsonsnent, or both..AS used in thffi,
of credit or payments 'between, bp, through, subdivision the term "person" means an indi-
or to any banking institution, and the fan- vldual, partnership, association, or corpora-~
porting, exporting, hoarding, melting, or ear- tion:.(4ct. 6, 1917, ch. 196, 4 6, 40 Stat. 41b;
1918, ch. 178, ? 5, 40, Stat. 966;
24
Sept
bullion
,
,
.
marking of gold or sliver coin or
currency or securities, and Mar. 9, 1933, ch. 1, 4 2, 48 Stat. 1; May 7, 1940,
(B) investigate, regulate, direct and cam- ch: 185, 4 1, 64 Stat. 179; Dec. 18, 1941, cffl. 598,
poi. nilllity void, prevent or prohibit, any tttle,III, 4 301, b:i Stat. 839; Proc. No. 269b,
acquisition ~hoiding, withholding, use, trans- July 4, 1948, it F R. 7517, 60 Stat. 1352.)
far, withdrawal, transportation, importation [See 12 U.S.C. 9b sad 95x. Supra.]
ar exportation of, or dealing in, or exercising Io IIS.0. 873. READY RESERVE
any right, power, ar privllege with respect (a) In time of national emergency declared
to, or transactions involving any property, in ~ the President after January 1, 1953, ar
which any foreign country or a national wheys otherwise authorized by law, nn au-
thereof has any. interest. authority designated by tho Secretary con-
by any parson, or with respect to any prop- cernod may, without the consent of the per-
- arty, subject to the jurisdiction of the United ~~ cencem~, order any unit, and any
Staten; and any property or interest of any member not assigned to a trait organized iao
foreign country or national thereof shall vent, serve as a unit, in the Ready Reserve undo[
when, as, and upon the terms, directed by the jurisdiction of thhat Secretary to active
the President, in such agency or person as duty (other than for training) for not more
may be designated tram time to time by the ,~y~ ~ consecutive months.
President, and upon such terms and condi- (b} To achieve fair treatment as between
Hans as ~ihe President may prescaribe such members in the Ready Reserve who are being
interest or property shall be held, used, ad- considered for recall'to duty without their
ministered, liquidated, sold., or otherwis0 consent, consideration shall 'be given to-
dealt with in the interest of and for the (1) the length, and nature of Previous sere'
beneSt of the United States, and such desig- loo ,~ assure such sharing of exposure do
acted agency or person map perform any. hazards es the national sec~uitp and mllitary
and all acts incident to the accompllahment requirements will reasonably allow;
Guard Reserve, may be ordered to active duty
in time of Presidential emergency for the
duration of the emergency and for 8 months
thereafter. In addition, the President may,
at any time, colt out the National C3uard and
Air National Guard to enforce the laws of the
United Staten, to quell insurrection, and in
case of actual or threatenefl invasion. Aa far
as the Naval Reserve, Marine Corps Reserve,
and Coast (}ward Reserve are concerned, this
subsection represents a substantial decrease
in the number and the period of service of
reservists liable to be ordered to active duty
to time of Presidential emergency.
NOTE-EXCERPTS FROM HOIISE REPORT lOCi6,
$2D CONG., 2D SESS. (1952)
THE READY RESERVE
The Ready Reserve defined by this section
would contain those portions of the reserve
components which would be most liable for
active duty and which would be subject to
call do time of w?r, or nation?f emergency
declared by the President or the Congress.
or when otherwise authorized by Zato. The
last phrase includes authority to order re-
servists to active duty pursuant to section
21 of the Universal Military Training and
Service Act which is not affected by this
bill.
Note, however, that under section 234(b),
whtch authorizes the ordering of the Ready
Reserve to active duty {n time of national
emergency declared by the President, the
:Congress must first determine the number of
members who may be so ordered-
The Ready Reserve would be the only part
od the reserve components which could be
used do a Presidential emergency without
further congressional action. At the present
time, all of the Naval Reserve, Marine Cores
Reserve, and Coast C3uard Reserve could be
palled to active service is a Presidential
emergency. In addition, the entire National
Ciuax'd and the entire Air National (luard
is noW callable by the President in Ease o!
.threatened or actual invasion, insurrection,
aI. tp execute the Federal laws.
xoTa
Under this provision 1,000,000 men can be
~~ to active duty. In addlttoa the Na-
ttonal Guard can be federalized in a national
emergency, which adds several thousand men
to the fatal. In time of national emergency,
therefore, in addition to existing armed
forces at least eight divisions of troops, over
-100 squadr?ns ?i aircraft anfl 6b ships can
~' activated by order of the President.
~ R SA. 278b. SAME: EXCEPTION OP CERTAIN
VrrAL LEASES DvRUra Was oR EMERGENCY
The provisions of section 278a of this title
shall not apply durtnq war or a national
emer a declared by Congress or by the
g nL~l
President to such lessee or renewals of eXist-
ing leases of privately ar publicly owned
proPertY ~ are certified by the Secretary
~ the Army or the Secretary of the Navp,
or by such person or persons as he may desig-
~,~ ~ covering premises for mllitary, naval,
m, civilian .purposes necessary far the prose-
cation of the was or vital in the national
emergency. (Apr. 28, 1942, ch. 249, 56 Stat.
247.)
NOTE-EXCERPT FROM HOII88 REPORT 2029,
77TH CONG., 2D SEES. (1942)
The Committee on Expenditures in the
Executive Departments, to whom was referred
the bill (S. 2212) to suspend during a na-
tional emergency declared by Congress or by
the President the ,provisions of section 32a
of the act of June S0, 1932, as amended,
having considered the same, report favorably
thereon with recommendation that it do pass
with amendments.
The purpose of the proposed leglslatton 18
to render inapplicable to lessee entered into
Presidentjshali, in the manner .hereinabove 3) employment necessary to maintain the
national health, safety, or Snterest.
provided, require any person to keep a itlu (
record, of, and to furnLah under oath, in the The Secretary of Detonse shall prescribe such
ioavn of reports or otherwise, complete in- olicies and procedures as he considers aer,-
formation relativo to any act or transaction essRry ,~ ~~ out this subsection. He sthall
referred to in this subdivision either before, report an those policies and procedures art
during, or after- the coanpletion. thereof, or least once a yeas to the Committees oa Armed
relative to any interest in foreign property, o
or relative to any p p rty p Services of the .mate and the House- of Rep-
ro a in which an for-
resentatives.
sign. country or any national thereof has ar (c) N~ mate ~~ 1 Opp 000 members ~pf
has had any interest, or as map be other- the Ready ~ amp ~ oa1 &Ctive duty
wino. nocessasy to enforce the provisions of (other than for tnaialllg), without their cwl
this subdivision, and is any case to which se'IIt. tinder .this saotiaa at any one linen.
map~n the manner hereinabove pmvidded, (Aug. 10, 19b6, c31. 1041, 70A 8tat. 28; Sept. $.
require the production, Or if necessary t0 the 1968, Pub. L. 8E-561, g>e 1 (14), 33 (s) (b), 'TZ
Scat. 1441, 1b64.}
national security or detenso, the seizure, of __
any !books of account, records,, contracts, lot- NOTE-EXCERPT .FROM HOIIS6 REPORT 1066, 82D
tars. memoranda, or other Papers, in the CONa~ 2e Sass. (1952),
custody or control of such person; and the
President may. 1n the manner hereinabove NATIONAL EMERGENCE! DECLARED liY THi
PRESrvarrr
provided, take other and further measures
not inconsLstent herewith for the enforce- In time of national emergency proaZatmed
maul of this subdivision. by the President, ~' when othereoiae au-
(2) Any payment, conveyance, transfer, as- thorized by Zavf, any member of the Ready
etgnment, or delivery of property or interest Reserve may be ordered to active duty with-
therein., made- to or for the account of tho out his consent for such period of time riot
United States, or as otherwise directed, par- to exceed 24 consecutive menthe, but no
suant to this subdivision or any rule, regu- member could be ordered to active duty,
cation, instruction, or direction ]sued hero- under the committee amendment, until the
under shall to the extent thereof be a cull ac- Congress had determined the number of
quittance and discharge for all purposes of members needed far the national security.
the obligation of the perm making the Members may be ordered ae individuals or
same; and no person shall be held liable in as units, but as In the previous subsection
any court for or in respect to anything done the committees has provided a safeguard
or omitted in good .faith in connection with against the ordering of individual members
bhe administration oi, or in._pursuance of and of units organized to serve as unite This
ia reliance on, this subdivision, or any rule, provision would apply only do a future na-
regulation, instruotioa, or direction issued t{anal emergency procla{mad by th.e PtESi-
heretmder. dent but would retain Sn effect the authority
(3) As used in this subdivision the terra to order such members to active duty under
"IInited States" means the United States section 21 of the. UMTS Act With the limits-
and any place subject to the jurisdiction; lions contained therein.
thereof: Provided, however, That the fora- At present time all members of the Naval
going shall not be construed as a limitation Reservo, Marine Corps Reserve, and the Coast
(2) family responabilities; and
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CONGRESSIONAL RECORD -- SENATE October 7, :1 ~ i I
by the Government for national defense pur- Ail purchases and contracts for property (f) Carriage of cargo; specification of con-
poses the present restrictions of section 322 and services shall be made by adves'asing, tainer size.
of the act of June 30, 1932, as amended (40 as provided in section 263 of this ti#te, ex- No contract for the carriage of Government
U.S.C. 278A), that the annual rental of prop- cept that such purchases and contrac*~, may property Srx other than Government-owned
erties leased may not exceed lb percent of be negotiated by the agency head without cargo containers shall require carriage of
the market value of -the premises on that advertising if-
date of the lease, and the further restriction (1) determined to be necessary in th~% pub_ eta edplength height gorewidth.e (June 310,
that alterations, improvements, and repairs lie interest during the period of a ne, "ional 1949, ch. 288, title II, ? 302, 63 Stat. 393; July
map not be made in an amount in excess emergency declared by the President ryr? by 12, 1952, ch. 703, ? 1 (m), 66 Stat. 594; Aug.
of 2b percent of the amount of tlxe rent the Congress;
for the first year of the rental term, or for (2) the public exigex:cy will not admit of Nov18,81 65bPub$L889~ 3431 ?? I,22, 79 S 8 t.
the entire rental term if the lease runs for the delay incident to advertising; 1303;-Nov. 8, 196b, Pub. L. 89-348, ? 1(2), 79
less than 1 year. (3) the aggregate amount involved does Stat. 1310; Mar. 16, 1968, Pub. L. 90-268, ? 4,
Testimony given by witnesses from the not exceed $2,500;
War Department indicates that these re- (4) for personal or professional servirs; 82 Stat. 50.)
strlotlonS are impracticable in connection (b) fOT ally 6erl%iCe t~) be rendered by any NOTE-EXCERPTS FROM HOUSE REPORT 670, $.LST
with leases og premises for the establishment university, rollege, or ether educational in-
of information and filter centers as part of stitution; CONG., 1sT SESa. (1949)
aircraft warning service installatiaus, and (8) the property or services are '.>> be TITLE III. PROCIIREMENT PROCEDURE
also in many other types of national defense procured and used outside the limits c f the This title follows in structure, and is iden-
leases, as, for example, the leasing of pxbp_ United States and its possessions; itical in language with, the Armed Services
erties far use as offices and warehouses, for (7) for medicines or medical property ; :Prceurement Act, with a few appropriate
storage or manufacturing purposes. Navy (8} for property purchased for auth~~rized ~%hanges and omissions.
Department expressed concurrence in these resale; Section 301. Declaration of purpose-
observatians. (9) for perishable or nonperishable sub- Thy section states that the purpose of
The .committee concurs in the view that sistence supplies? title III is to iacllitate the procurement of
a.ll leases which are to be exempted from the (10) for property or services for which it supplies and services.
provisions of section 322 of the act of June is impracticable to secure competition? Section 302. Application and procurement
30, 1932, as amended, should be certified by (11) the agency head deternnes thar. the rnethods-
the Secretary of War or the Secretary of the purchase or contract is for experiments:, de- * * * ; *
Navg, or their authroized representatives, as velopmental or research work, or for the (c) Initially, this subsection reaffirms-the
covering premises for military, naval, ar ei- manufacture or furnishing of propert ~ for basic principle that purchases and contracts
vilian purposes necessary for the prosecu- experimentation, development researchT, or shall be made by advertising. Negotiation is
tion opt the war or vital In the national ewer- test;
gency, The bill, as introduced, was amended (12 for made permissible in certain excepted cases,
by the Senate by insertion ai appropriate the agency hread rdeterm nescth t the ac rar~ nxsnt procurementde flexibility in Govern-
language to this effect. This language will acter, ingredients, or components thareoi
require executive departments or establish- are such that the purchase or contract slirnIId (1) This paragraph would -permit aut'r
menu other than the War and Navy Depart- not be publicly disclosed- ntatlc and immediate transition from more
menu to abtaixx a certificate gram an author- (13 fore ui meut which the- a enc rigid peacetime advertising procedures to a
ized re resentative of the Secrets of War or ) q P g y _"e~ completely flexible system if the President or
P r9 determines to be technical equipment and
the Secretary of the Navy to the effect that as to which he determines that the proc:~ue- the Congress declares the existence of a na-
the lease in question is necessary for the went thereof without advertising is nr:ces- tional emergency.
prrosecution of the war or vital in the na- airy in special situations or in particular .,, n ~-?
tionalemerGenr,~_rt,,..Q,,,,,,,,,,,,,,~.._~_._ _._ ,,.,,..,,...... .,,.., .------__-..
-- --------ro ?~~-????~+v~.as wiucrx, 3II Lne
judgment of the committee, are desirable
where prosecution of the war effort is not in-
volved, wlll be applicable.
41 U.S.C. 252. PIIRCIiA3Ea AND tiaNTRACTa
FOR PROPERTY
(s) Appltcabllity of chapter; delegation of
authority. '
Executive agendas shall make purchases
and contracts for property anal services in
accordance with the provisions of this chap-
ter and implementing regulations og the
Administrator, but this chapter does not
applp-
(1) to the Department of Defense, the
Coast Guard, and the National Aeronautics
and Space Administration; or
(2) when this chapter is made inapplic-
able pursuant to section 474 of Title 40 or
any other Yaw, but when this chapter is made
inapplicable by such provision of law, sec-
tions 6 and 8 of this title shall be applicable
in the absence of authority conferred by stat-
ute to procure without advertising or with-
out regard to said section 6 of this title.
(b) Small business concerns; share of busi-
ness; advance publicity on ne-gotiated pur-
chases and contracts for proper-ty.
It is the declared policy og the Congress
that a fair proportion of the total purchases
anal contracts -for property and services far
the Government shall be placed with small
business ooncenxs, Whenever it is proposed
to make a contract or purchase in excess of
$10,000 by negotiation and without advemtis-
ing, pursuant to the authority of paragraph
(7) or (8) of subsection (c} oY this section,
suitable advance publicity, as determined by
the agency head with due regard to the type
of property Involved and other relevant con-
siderations, shall be given far a period of at
.least fifteen days, wherever practicable, ae
determined by the agency head.
(c) Negotiated purchases and contracts
for property; conditions.
and that such standardization and ~ii;er- All transfers and assignments made of any
changeability is necessary in the public claim upon the United States, or at any
interest; pa~r?t or share thereof, or interest therein,
(14) for property or services as to Which Tether absolute or conditional, and what-
the agency head determines that bid prices ever may be the consideration therefor, and
after advertising therefor are not reasonable a11! Powers of attorney, orders, or other su-
(either as to all or as to some part of tITe- thorities for receiving payment of any auclr
requirements) or have not been indepe_ad- claim, or of any part or share thereof, ex~
entl
i
p arr
ved at In open competition: Pro-
vided, That no negotiated purchase or c,an-
tract may be entered into under this pr ra_
graph after the rejection of ail or some: of
the bids received unless (A) notification: of
the intension to negotiate and reasonable
opportunity to negotiate shall have been
given by the agency head to each responsible
bidder and (B) the negotiated price is the
lowest negotiated price offered by any resun-
sible supplier; or
(16) otherwis,s authorized. by law, except
that section 264 of this title shall apply to
purchases and contracts made without ~ d-
vertising under this paragraph.
(d) Bids In violation of antitrust laws.
If in the opinion of the agency head bds
received after advertising evidence any vio~a-
tion of the antitrust laws he shall refer su_h
bids to the Attorney General for approprfa ;e
action.
(e) Exceptions to section.
cept as hereinafter provided, shall be ab-
so1!utely null. and void, unless they are freely
mitde and executed In the presence of at
least two attesting witnesses, after the-allow-
ance of such a claim, the ascertainment of
the amount due, and the issuing of a war-
rarrt for the payment thereof. Euch transfers
assignments and powers of attorney must
recite the warrant for payment and must be
acF:nowledged by the person making them.
before an officer having authority to take
ack:nowledgementa of deeds, and shall be
certified by the officer; and it must appear
by the certificate that the officer, at the time
of the acknowledgement, read and sully ex-
plained the transfer, assignment, or warrant
of attorney to the person acknowledging the
same. The provisions of this section shall not
aPF~ly to payments for rent of postoffice quar-
ters made by postmasters. to duly author-
ized agents of the lessors.
The provisions of the preceding paragraph
shall not appl
in
n
y
a
y case in which the
This section shall not b9 construed to (~i) moneys due or to become due from the
authorize the erection, repair, or furnishing United States or from any agency or depart-
of any public building or public Smprovv_ merit thereof under acontract-providing for
went, but such authorization shall be re- Payments aggregating $1,000 or more, are as-
quired in-the same manner as heretofore, ~r signed to a bank, trust company, or other
(B) permit any contract for the constru_- financing institution, including any Federal
tion or repair of buildings, roads, sidewalks, lending agency: Provided, .-
sewers, mains, or similar items to be neg!z- 1. That in the case of any contract entered
tinted without advertising as required bg into prior to October 9, 1940, no claim shall
section 253 of this title, unless such cox:.- be assigned without the consent of the head
tract is to be performed outside the Conti- of i:he department or agency concerned;
nental United States w? unless negotiation of 2. That in the case of any contract en-
such contract !s authorized by the provisions tared into after October 9, 1940, no claim
of paragraphs (i).(3), (SO)-(12), or (14) shall. be assigned if it arisen under scon-
of subsection (e) of this section. tract which forbids such assignment;
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Octoberr 7, 19~'.~ CONGR.ESSIONAL RECORD-SENATE ~ 1365
3. That unless otherwise expressly per-
mitted by such contract any such assign-
ment shall cover all amounts payable under
such contract and not already paid, shall not
be made to more than one party, and shall
not be subject to further assignment, @x-
cept that any such assignment may be made
in one party as agent or trttstee for two or
more parties participating in such financing;
4. That in the event of any such assign-
ment, the assignee thereof shall file written
notiice of the assignment together with a
true .copy of the instrument of assignment
with (a) the contracting officer or the head
of his department or agency; (b) the surety
or suIeties upon the bond or bonds, if any,
in connection with such contract; and (c)
the disbursing officer, if any, designated in
such contract to make payment.
Notwithstanding any law to the contrary
governing the validity of assignments, any
assignment pursuant to this section, shall
constitute s valid assignment for all pur-
poses.
In any case in which moneys due or to
become due under any contract are or have
been- assigned pursuant to this section, no
liability of any nature of the assignor to the
United States or any department or agency
thereof, whether arising form or independ-
ently of such contract, shall create or im-
pose any liability on the part of the assignee
to make restitution, refund, or repayment to
the United States of any amount heretofore
since July 1, 19b0, or hereafter received under
the assignment.
Any contract of the Department of Defense,
the General Services Administration, tlae
Atomic Energy Commission, or any other de-
partment or agency of the United States
designated by the President, except any such
contract under which full payment has been
made, may, in time of war- or national
emergency proclaimed by the President (in-
cluding t7Le national emergency proclaimed
December 16, Y950) or by Act or joint resolu-
tion of the Congress and until such war or
national emergency has been terminated in
such manner, provide or be amended with-
out consideration to provide that payments
to be made to the assignee of any moneys
.due or to become due under such contract
shall not be subject to reduction or set-ofj,
and if such provision or one to the same
general effect has been at any time hereto-
fore or is hereafter included or inserted in
any such contract, payments to be made
thereafter to an assignee of any moneys due
or to become due under such contract,
whether daring or after Stich war. or emer-
gency, shall net be 'subject to reduction or
set-off for any liability of any nature of the
assignor to the United States or any depart-
ment ar agency thereof which arises inde-
pendently of such contract, or hereafter for
any liabllity of the assignor on account of
(1) renegotiation under any renegotiation
statute or under any statutory renegotiation
article in the contract, (2) fines, (3) penal-
ties (which, term does not include amounts
which may be collected or withheld from
the assignor in accordance with or for Failure
to comply with the terms of the contract),
or .(4) taxes, social security contributions;
or the withholding ar nonwithholding of
taxes or social security contributions,
whether arising from or independently of
such contract.
Except as herein otherwise provided, noth-
ing in this section shall be deemed to affect
or impair rights- or obligations heretofore
accrued. (R.S. ? 3477; May 27, 1908, ch. 206,
35 Scat. 411; Oct. 9, 1940, ch. 779, ? 1, b4 Stat.
1029; May lb, 19b1, ch. 7b, 65 Stat. 41.)
NOTE-EXCERPT FROM SENATE REPORT 217,
82D CONG? ,1ST SESS. (19b1)
The purpose of this enactment was to en-
courage the participation oP banks in the
financing of Government contractors under
the defense program of that time. It per-
matted contraci;o'rs to assign to financing in-
stitutions moneys due or to become due
under their Government contracts, and it
assured the assignee banks that, when pa,y-
meats were made to them by the Government
pursuant to such assignments, such pay-
ments would not be subject to reduction
or set-off on account of any claims the Gov-
ernment might have against the contractor
arising independently of the assigned
contract.
Enactment of S. 988, with committee
amendments, would male it clear that a
batik or other financing institution taking
an assignment oY claims pursuant to the act
would not be subject to later recovery by
the Government of amounts previously pcdid
to the bank as assignee, except, of course,
that it would '.not .prevent the Government
from obtaliiing restitution of amounts which
may have been paid as the result of fraud.
Second, the amendment would continue
the provision of the present law that, if an
assigned contract contains a "no set-off"
clause, payments Inade by the Government
to the assignee bank will not be subject to
reduction or set-off because of any claims
of the Government against the contractor
which arise independently of the contract,
but it would. also be made clear that the ~as-
signee would be protected against set-off on
account of claims oi' the Government against
the contractor arising Yroln renegotiation,
fines, and penalties--claims which are or-
dinarily regarded as arising outside of the
assigned contract. I:n any event, however,
where the Government has claims against
the contractor., the Government would be
allowed to withhold, out of payments due to
an assignee bank, any amounts in excess of
the bank's interest in loans secured by such
assignments.
Finally, the authority for including the
"no set-off" clause fn Government contracts,
which is now restricted to the Departments
of the Army, Navy, and Air Force, would be
extended to contracts entered into by t:he
General Services Administration, the Atornic
Energy Commission, and suc11 other agencies
of the Government as the President may des-
ignate. Howeve;, authority for the inclusion
of the clause would not be mandatory--it
would be permissive In all cases at the dis-
cretion of the, Government agencies con-
cerned.
41 U.S,C. Sb. TRANSFERS OF CONTILACTS; ASSIGN-
MENT OF CLAIMS; SET-OFI+ AGAINST ASSIGNEE
No contract or order, or any interest there-
in, shall be transferred by the party to whom
such contract or order is given to any other
party, and any such transfer shall ca~xse
the annulment of the contract or order
transferred, so far a:t the United States are
concerned. All rights of action, however, for
any breach of such contract by the contract-
ing parties, are reserved to the United States.
The provisions of the preceding paragraph
shall not apply in any CRSe in which the.
moneys due or to become due from the Unit-
ed States or from anp agency or department
thereof, under a contract providing for pay-
ments aggregating $1,000 ar more, are :as-
signed to a bank, trust company, or other
financing institution, including any Fed-
eral lending agency: Provided, 1. That in the
case of any contract entered into prior to
October 9, 1940, no claim shall be assigned
without the consent of tlxe head of the de-
partment or agency concerned; 2. That in
the case of any contract entered into after
October 9, 1940, na claim shall be assigned
if it arises under a contract which forbids
such assignment; 3. That unless otherwise
expressly permitted by such contract any
such assignment sha1.1 cover all amounts pay-
able under such contract and not. alresidy
paid, shall not be made to more than one
party, and shall not be subject to further
assignment, except that any such assignment
may be made to one party as agent or trustee
for two or more parties participating in such
financing; 4. That in the event of any such
assignment, the assignee thereof shall file
written notice of the assignment together
with a true copy of the instrument of as-
signment wit11 (a) the contracting officer or
the head of his department or agency; (b)
the surety .or sureties upon the bond or
bonds,. if any, iri connection with such con-
tract; and (c) the disbursing officer, it any,
designated in such contract to make pay-
ment.
Notwithstanding any law to 'the contrary
governing the validity of assignments, any
assignment pursuant to this section, shall
constitute a valid assignment for all purposes.
In any case in which moneys due or to
become due under any contract are or have
been assigned pursuant to this section, no
liability of any nature of the assignor to
the United States or any department or
agency thereof, whether arising from or -in-
dependently of such contract, shall create
or impose any liability on the part of the
assignee to make restitution, refund, or re-
payment to the United States of a,ny amount
heretofore since July 1, 1950, or hereafter
received under the assignment.
Any contract of the Departtent of De-
fense, the General Services Administration,
the Atomic Energy Commission, or any other
del3artmeut or agency of the United States
designated by the President, except any such
contract under which full payment has been
made, may, in time of user or national emer-
gency proclaimed by the President (including
the national emergency precis{med Decem-
ber 16, 1950) or by Act or joint resolution of
the Congress and until such war or national
emergency has been terminated in such man-
ner, provide or be amended without consid-
eration to provide that payments to be made
to the assignee of any moneys due or to
become due under such contract shall not
be subject to reduction or set-off, and iP such
provision or one to the same general effect
has been at any time heretofore or is here-
after included or inserted in any such con-
tract, payments to be made thereafter to an
assignee of any moneys due or to become due
under such contract, whether during or after
such war or emergency, shall not be subject
to reduction or set-off for any liability of
any nature of the assignor to the United
States or any department or agency thereof
which arises independently of such contract,
or hereafter for any liability of the assignor
on account of (1) renegotiation under any
renegotiation statute or under any statutory
renegotiation article in_ the contract, (2)
fines, (3) penalties (which term does not
include amounts which may be collected or
withheld from the assignor in accordance
with or for (allure to comply with the terms
of the contract), ar (4) taxes, social security
contributions, or the withholding or non-
withholding of taxes or social security con-
tributions, whether arising from or inde-
pendently of such contract.
Except as herein otherwise provided,
nothing in this section shall be deemed to
affect or impair rights or obligations hereto-
fore accrued. (R. S. ? 3737; Oct. 9, 1940, ch.
779, ? 1, b4 Stat. 1029; May lb, 1951, ch. 75,
66 Stat, 41.)
NOTE-EXCERPT FROM SENATE REPORT 217, 82D
CoNG., 1sT SESS. (1951)
The Committee on Banking and Currency,
to whom was referred the bill (S. 998) to
facilitate the financing of defense contracts
by banks and other financing institutions,
to amend the Assignment of Claims Act of
1940, and for other purposes, having con-
sidered- the same, report favorably thereon
with amendments and recommend that the
bill, as amended, do pass,
s ? ? i ?
Enactment of S. 998, with committee
amendments, would make it clear that a bank
or other financing institution taking an
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CONGRESSIONAL RECORD - SF HATE October 7; 1 ~ 'l~
assignment of claims pursuant to the act
would not be subject to later recovery by the
Government of amounts previously paid to
the bank as assignee, except, of course, that
it would not prevent the Government from
outaining restitution of amounts which may
have been paid as the result of .fraud.
S+~condly, the amendment would continue
the provision of the present law that, if an
assirryned contract contains a "no set-off"
c:lanse, payments made by the Government to
fire assignee bank will not be subject to
reduction or set-off because of any claims of
the Government against the contractor which
arise independently of the contract, but it
would also be made clear that the assignee
a~ouid be protected agafnat set-off on account
of claims of the Government against the
contractor arising from renegotiation, fines,
and penalties-claims which are ordinarily
regarded as arising outside of the assigned
caniract. In any event, however, where the
Government has claims against the contrac-
Wr, the Government would be allowed to
withhold, out of payments due to an assignee
bank, any amounts in excess of the bank's
interest in loans secured by such assign-
ments.
F`irrally, the authority for including the
"no set-off" clause in Government contracts,
which is now restricted to the Departments
of the Armv, Navy, and Air Force, would ire
extended to contracts entered into by the
General Services Administration, the Atomic
Energy Commission, and such other agencies
of the Government aS the President may
designate. However, authority for the inclu-
sion of the clause would not be mandatorp-
it would be permtssive in all cases at the
discretion of the Government agencies con-
cerned.
l~fr. BOTH. Mr. President, as a sponsor
of the National Emergencies Act, I am
pleased with the rapid consideration
which the Senate is giving to this impor-
tant legislation. I strongly urge its pass-
age today.
'I'bis bill represents another effort by
Congress to insure that Congress and-the
President share equally the responsibility
for major national policy decisions. This
bill, for the first time, will establish cri-
teria under which a national emergency
can be declared by the President and
provides for its automatic termination
unless extended by.congressional action.
It also terminates four national emer-
gencies which are still in effect. Most
Americans do not know that since March
6,_1933, the United States has been in an
ollicial state of national emergency. The
1933 emergency was declared to deal with
the Depression. In addition, three other
national emergencies are concurrently in
effect-the December 16, 1950 emergency
in connection with the Korean war, the
t~iai?ch 23, 1970 emergency to handle the
Post Office strike, and the August 15,
1991 emergency to carry out certain cur-
rency restrictions to help our balance
oi' payments.
because Congress has been remiss in
not terminating these emergencies, many
outdated statutes designed to give the
President wide-sweeping powers to meet
the emergency situations of those times
rE;lnain on the books. It is my under-
standing that in its almost 2 years of
diligent work, the Special Committee on
the Termination of the National Emer-
;;ency compiled some 470 provisions of the
united States Code which in some way or
zi=lother delegate extraordinary powers
try the President in times of war or na-
tional emergency.
It is important and esssentiai that in
such times, the President does have ~:he
powers needed to deal with the situati _rn.
But it is also essential. that when '::he
emergency is over, the emergency powers
either terminate or are carefully re-
viewed to insure that they make soc,.~ld
and responsible pelznanent legislation..
In times of emergency, important l~~g-
islation does not receive the time and
attention which it mould in zlormal tilr 's.
One provision that this bill would. ?e-
peal gives the President, the .Secret;:-iy
of the Armv, or any general the authority
to declare any part or all of the Uni~.ed
States a military zone, within which >~ ny
act he designates may be punished as
a crime. Such a sweepiig provision r~:p-
resents apotential. threat to America ?.l~n
liberties and should certainly be strl:ck
from the books.
In my judgment, this bill devises a
sensible way of insuring that rapid acti ~n
can be taken to meet an emergency siti:a-
tion while safeguarding against the ar':ai-
trary and irresponsible llse of such pot+ er
by a future President. Under the t `,11,
the President is authorized to declrFre
a national emergency whenever he l;e-
.lieves it "essential to the preservati -gin,
protection, and defense of the Constf? =~1-
tion, and is essential to the common ce-
fense, safety, or well-being of the tei ~i-
tory and people of the United States."
However, the emergency could bet r-
rninated-by Congress-by concurrent reso-
lution and, if not, would expire at the ~ nd
of 6 months unless explicity contini~d
by Congress. Morn over, the President
would be required during the emerges cy
to keep a list of all Executive orders, p_?o-
mulgations, rules,. et cetera, made w?th
respect to the emergency and transi^ft
the texts to Congress. This provision a~11
provide a comprehensive overview of ;xll
extraordinary acts taken during ;~n
emergency and a mea,.ure of congr. s-
sional oversight over such acts.
I believe that this bill strikes a care'ul
balance between the need far the Pre~i-
dent to act ixl the case of war or anotl er
kind of national emergency and the -?a-
quirements of shared powers and respon-
sibilities between Congress and the Pre ,i-
dent. Ihope it will be passed today azid
speedily acted upon by Lhe other Hoy se
and signed into law by the President.
Mr. MATHIAS. Mr. President, I u e
the adoption of the amendment.
The ACTING PRESIDENT pro to:_-
pore. Tile question is on agreeing to tr`.ie
amendment in the natul?e of a substitu e.
.The amendment was agreed to.
T'he bill was ordered to be engross ed
for a third reading, was read the th rd
time, and passed, as follows:
S. 3957
An act to terminate certain authorities w th
respect to national emergencies still in
effect, and to provide for orderly im~'e-
mentation and termination of future ~:a-
*,ional emergencies
3e it enacted by tt~e Se~aate a>sd House o/
Representatives o/ the TJnited States of
Amer4ca in Congress assembled- That t;:ris
Ac,t may be cited as the "ational Emergr n-
efea Act".
TITLE I-TERMI"_dATING EXISTING
' DECLARED EIVIERGENCIES
SEC. 101. (a} All powers and authori# ies
possessed by the President, any other offi,y to perpetuate this sas-
tem so in opposition to even their o pan
stated goals. I realize that this is joist
one example and that streafrilining c~ne
program alone will not save -the ecc.~n-
omy. But by providing a series of s;~~h
examples, maybe we can show the Amd r-
ican public haw we ought to begin. An-
other area to consider would be Fede ?al
contracts. Just as cost-zeros Government
contracts must cease so should the Da ~~is
Bacon Act which governs wages p~.id
under Government contracts. There is
no sector of Goverrcment: spending wh`~?h
cannot be cut down, streamlined, and
improved.
One area alone should not be b~~r-
dened with the solution of irrfiatirm,
least of all the Defense Department. I
wonder, Mr. President, if I am heg~n-
ning to understand the thinking of th+:>se
who want, in the name of beating 3r1f a-
tion, to dismantle our defense system,
It may be that their theory is that at the
current rate of inflation"there will be
nothing left to defend.
An unfortunate tendency of Congr ~~ss
is to hasten its abdication of responsi-
bility by the setting up of monstrous k:~u-
reaucracies. The Congress knows p=:r-
fectly well what happens next. Althou ~h
the orlginal purpose of these bureal.:c-
racies was to rectify an evil or prove, de
a service, their main function shor'.ly
became self-preservation. Some Pti r-
petuate themselves by complicating the
very problems they were established to
resolve. Others are not content to serve
those who seek out their assistance, l:~ut
actively engage 1r1 ferreting out nyw
clients. Those which actually get the ' ~b
done then have to seek out whole new
areas of responsibility. And now we have
provided them with a legal services cc:r-
poration which gives lawyers the en-
couragement and money to bring larl.-er
numbers of citizens under the control of
more bureaucracies. We recently n..r-
rowly defeated an effort to create a
superagency in the name of consumes.
This agency would presumably have re~-
resented everybody In all areas, as it
would have had "consumer responsit: i.l-
ity" over all other agencies. It is obvic; us
that the answer to the question who is a
consumer is the counterquestion, who is
not a consumer? Turning the counk ay
into a nation of bureaucrats 1s not tre
solution to inflation.
I would also like to point out sore e-
thing Iexpect to see forted on us. Pr': or
to 1969 the budget was computed unc er
the arlrn9nictrative budget concept. T) is
meant that trust funds, such as sec al
security, were not reflected in the budg-'t,
In 1969 for the first time since the EisF-2-
hower administration there was lip ser v-
ice given to the idea of a balanced buc ;-
et. But the method chosen to accor:a-
plish this was neither a curtailing of
spending nor an inereasr. in taxes, but cn
accounting device. The budget went frc: ~n
a deficit of $27,800,000 to an appare;:it
surplus of something over $3 million. E~?it
behind the fancy paperwork everything
was the same. Now it will be interesting
to see what happens when the social
security fund cannot begin to make the
payments required by the quantum jump
in benefits. An admission of bankruptcy
wi:tl have to be made before the expected
run on general revenues occurs.
7[ have no doubt that the next sug-
gestion will be to return to the admin-
istrative budget concept as a was*, this
time not of creating a budget surplus,
but of reducing the deficit. However,
elaborate accounting techniques will not
save the economy. They will not replace
solrnd fiscal and monetary policies.
:[ noted in the colloquy between the
majority leader and the minority leader
there were two areas to which the major-
ity leader referred as causes of the cur-
rerrt inflation. One was the war in South-
east Asia, and the second were the cur-
rent oil price increases.
1VIr. President, I would suggest, as I
have in the past, that it does no good to
seE~k scapegoats rather than confronting
responsibility. 'The war in Southeast Asia
was a creation of and supported by the
Congress of the United States. The mon-
ey:l that were spent were appropriated
by the Congress of the United States.
011 prices are the result of congres-
sional action or, perhaps I should say,
colrgressional inaction because of the
facts that have been .readily apparent to
anyone who would be willing to listen for
more years than Congress would care to
confess, and the lnactian of Congl?ess in
meeting the emergency energy crisis is
the direct cause of the increase in oil
prices.
Let us not be deceived that the Congress
of the United States can escape respon-
sibility by its failure to act. The respon-
sibility for where we stand new still
rernains on the shoulders of the Congress
of the United States.
'.Che resulting inflation which racks
this country is still squarely upon the
Congress of the United States and if, as
a matter of fact, we are to finds way out
of this dilemma it will require affirmative
action by Congress as well as by the Exec-
utive.
2~ir. President, I think it fs time for
Congress to join with the administration
and seek the affirmative and Positive pro-
gra,ms to work our way out of what Ls
not necessarily an economic collapse but
a serious economic problem.
7['hank you, Mr. President. I yield back
the remainder of my time.
ORDER F BUSINESS
Pdr. MANS Mr. President, I
ask: to be recogniz now in place of the
Senator from Nebr a.
7'lre ACTING PR IDENT pro tem-
pore. Without objecti , it is so ordered.
P/fr. MANSFIELD. suggest the ab-
sence of a quorum.
7'he ACTING PRES ENT pro tem-
pore. The clerk will call roll.
7~1e second assistant 1 lative clerk
pra~ceeded to call the roll.
Mr. MANSFIELD. Mr. ident. I ask
unanimous consent that the rder for the
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~ +~~(( PAGE 4
'~
T E WASHINGTON POST DP
H
t.
,
j '~ ~' f~' Th.e 460 -laws that would be
Senate ~` iDt(~~ EiYIERGENCY, Feont Al ~~~th the Posh, O~ ri.~~_~ pied in legal limbo by the
~ ~ and to impler~t ~,urrenc'y re-; bill passed yesterday include
I'resldentl~l sensor of the measure as ~g striation to dlltxal troreii;n such measures as authority for
.auitli--Sen. Frank Church. (D- trade. ~K., .:,., ~ the President to take over
y,:. -..,
Idaho). In addition, the committee, communications media, ship=
hOWe.t' +Cu~o~ `-~l'athias and Church served found that Congress delegated i ping and other private prop-
- as cochairmen of a special emergency powers _to presi- arty. ~Tnder the bill, such pow-
Ry Stephen Green Senate committee created. two dente in 470 bills that still re- ers could not be used unless a
washfnston cost stare wr~t~r ,Years aga to investigate the ma%ned in effect' One of them, . new state of emergency was
status of emergency presiders- among the 10 the Senate voted declared.
Tiae,....~+enatP yntnd v atPrda ti.al ewers: '~'hP hill n?~y~
..,_? P y p oes to .repeal authorized any gars- If president, under the bill,
4 take away firom the execu- to the IIouse where a similar eral to declare any position of declared a state of emergency,]
title hranrh of thA ?'" '~ ant `~ r ""i~~use the country a military zone, ~ Congress would would have h j
hair- ~
,~~ arv ittoe
fi
t
w
.
_
s
ewers ma P Pr Rndin __ is subject to martial law. decide within x meri
that hart t,pa? .,~~,,,,...._, ,_ ~~ t o G~'1`~' ,~n~??,,, ,,, n,,,,,, ,,,,,,,,,, ~,,., whether it shoul~ be: ~Qnt.in-,
-~'-~-~-b^y-?-?uaanimous
yoicr~ vn~ fhp ~ etlatR--~Cted
tn~t,Prmin~}n ?;~l,r~Cha}p
emer arse rmposed b presi-
ents sznce ,~~,?_a, ke al 10
emergertc -re ate 1 s~ and
suspen 0 other laws that
lave liven ex raordinary
powers to i . PY?^,~tive
h?
The Senate vote came after
brief debate. The measure, if
passed by they ~Iouse and
signed into laFV, would end
emergency powers assumed by
presidents to deal with the de~
pression in 1933, to mobilize
the nation for the Korean
War, to deal with a 1970 postal
strike and'to implement cur-
rency restrictions to control
foreign trade.
The laws that would be sus.
pended, if .the measure be-
comes law, range from estab-
lishing presidential. authority
to imposing marketing quotasy
to extending the enlistment
periods of military men. They
also include such powers;.
authority tq abrogate Indiatl
treaties, to take aver power
plants and to establish deten-
tion camps.
" is will help restore the
balanc ,~WSF"']Se'twehit
~resrs,~and t e ex_~ive
branch sal Sen_ Charles
See EMERGENCY, A16, Col, 1
"In the view of the special ne put rn tau for a year for vi-; Mathias said. that before he
committee, permitting this elation of any executive order ~ and Church introduced the
body of potentially authoritar- of the President," Mathias and ; bill Aug. 22, they met with
i&n power to continue in force Church-said. ' President Ford and agreed- "to
in the absence of a valid , na- The two senators said that I work with the executive
tional emergency situation po- "only a smal portion of the.' branch at every stage srid to
ses a hazard to democratic 470 delegated. emergency.: pow- consider any new pro~sosals
government;" Mathias -and 'ers is being used. This. is one' that. might be made."
Church-said in a joint state- significant proof that there is The Satiate originally was
merit yesterday. no longer an emergency that scheduled to vote on the meas-
"Aggressive presidents, per- requires extraordinary delega? ure last wee>i-but decayed ac-
missive congresses and a long. Lions of powers." tiers whQn Ford administration
series of successive crises However,, they said, "some officials asked that same
have all contributed. to the of the departments '&nd agars- ch~nees be made.
erosion of 1Ehe structure of di- - ~,~ - As a result, Mathias yester-
vid.ed ewers, th.e bedrock of cies have-used emegenc~ an-
p thorities as basic aye day ~av amended the bill to give
our constitutional system of ~ - - the executive branch 12
government," they added. law "
As an example, they `cited months to end the states
When members of the bipar- the Treasury Department of emergency.
tisan Senate committee 'began ~ -
~ their work they thought the which, they said has.. used .a
only national emergency sti111 Warld War I trading with tfie
in effect was the 1954 emer-' enemy law 1;o regulate "as?
genes declared by President I pacts of foreign trade and in-
Truman at the time Hof the Ko-j ternational monetary controls.
rear War.
As the committee investiga-
tion proceeded, it was learned
that still in effect were the
1933 depression states of emer-
gency declared by President
.Franklin Delano 'Roosevelt
~z Fns ~~~~- o_f emergency de-
clared in.1970 and 1971 by for-
~ mar President Richard M.
Nixon to deal, respectively,
For example, department used
this law in August, 1971, to
limit the ekport of soybeans
Mathias introduced a last-
minute, amendment yesterday
exempting .the trading-with-
the-enemy act from the bill, at
the request of the Ford adniin-
istratiou. He raid the adminis-
tratioYl believes the act to be
absolutely essential for the op-
eration of gvernment.
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