minimum standards of efficiency, assisting them in meeting problems peculiar to their localities, promoting uniformity in their administrative and statistical procedure, furnishing and publishing information as to opportunities for employment and other information of value in the operation of the system, and maintaining a system for clearing labor between the several States." To discharge these responsibilities the United States Employment Service engages in the development of operating methods and tools as required by the local offices in face of changing labor market conditions, and analyzes the experience and practices in the various States in order to provide for the prompt extension of the best operating practices to all local employment offices. The national office supplies employment counseling and specialized placement material to be used in assisting disabled war veterans and other handicapped workers in their occupational choice and in finding employment. In cooperation with the States, it develops methods for analyzing labor supply, employment opportunities, hiring specifications, and employment and unemployment trends. a national, uniform reporting system is maintained in order to appraise operations, determine work load and budget needs. Labor-market data for major labor market areas, industries, and occupations is collected and analyzed for exchange among local offices and for the use of other Government agencies whose programs and activities are affected by manpower considerations. The USES provides uniform national occupational classification structures, job definitions, and descriptions through an occupational dictionary and technical aids for selection and referral of workers to jobs. FISCAL AND PERSONNEL REQUIREMENTS In connection with the financial phases of the program the USES establishes fiscal and personnel standards and procedures for the guidance of the States. Within the limits of funds appropriated by the Congress, grants are made in accordance with the established requirements of each State for proper and efficient administration of its employment service. A uniform system of fiscal reporting is maintained, and provision is made for periodic auditing of expenditures. CLEARANCE OF LABOR An extremely important employment service activity is the one required by the Wagner-Peyser Act for clearing labor between the several States. One phase of this activity has to do with providing an adequate employment exchange for professional and specialized workers. During the past year an important step was taken toward improving the service rendered employers searching for such workers and for professional workers seeking new job opportunities by establishing the national clearing house. This has been done by merging the placement functions carried on by the National Roster of Scientific and Specialized Personnel with the interarea placement of executive and professional personnel not previously included in the roster operations. For the first time, provision is made for adequate exchange for a class of workers whose employment opportunities are principally in the national rather than the local labor market. REGIONAL OFFICES The United States Employment Service maintains relations with the States through a system of regional offices. These offices work with the States in the preparation of their annual budgets and provide technical advice and assistance in the operation of the program within the States. They expedite the clearance of labor among the States of the region and between regions, and play a significant part in the movement of migratory labor for farm production. VETERANS' EMPLOYMENT SERVICE The Veterans' Employment Service, operating under the policies of the Veterans' Placement Service Board which consists of the Administrator of Veterans' Affairs, the Secretary of Labor, and the Director of the Office of Selective Service Records, maintains a small program staff in Washington and field representatives attached to the State employment services. These representatives promote the employment opportunities of veterans with public and private employers and provide functional supervision of the veterans' employment activities of local employment offices. FARM PLACEMENT SERVICE The Farm Placement Service maintains a planning and expediting staff in Washington for directing the movement of migratory farm labor. It has a small field staff attached to the regional offices who work with the States in the advance scheduling of labor needs and do whatever is necessary to assure that farm labor is available as the crops mature and are ready for harvest. By analysis of total farm labor supply and demand, it is in a position to assist the States and farm groups in preparing recruitment, housing, and transportation programs in advance of the agricultural season. FUNCTIONS OF THE BUREAU OF EMPLOYMENT SECURITY The Bureau of Employment Security through its staff in Washington and its regional offices works with the States in the operation of the Federal-State unemployment insurance system. It reviews, State budgets for the operation of the system and under the direction of the Commissioner of Social Security, administers the grants for State administration. It is also the channel through which grants for the operation of the servicemen's readjustment allowance program are made by the Veterans' Administration. It makes studies of the methods and procedures of State operation and disseminates the best State experience to all the States. At the request of any State, it will make organizational or procedural studies to improve operating practices. It makes analyses of State laws and State programs and makes its findings available for use in the States. 1 Actual appropriation available was $6,611,600 and above figures, therefore, include $607,564 of comparative transfers. 2 Actual appropriation available is $3,701,000 and above figures, therefore, include $1,038,894 of comparative transfers. 3 Actual appropriation available was $900,000 and above figures, therefore, include $194,679 of comparative transfers. 4 Actual appropriation available is $947,500 and above figures, therefore, include $164,670 of comparative transfers. Mr. HARDY. One other question, Mr. Webb: In your opinion, would it make any difference whatever in the operation of the Veterans' Placement whether these functions were in the Department of Labor or the Federal Security Agency? Mr. WEBB. Yes; I think it would make a difference. Mr. HARDY. Why? Mr. WEBB. Because I feel that the set-up in the Labor Department is aimed at the fundamental law which I read a short time ago as to relationships between employer and employee, and the effort is to insure full employment. I also believe the efforts that have been made with the veterans and other groups will continue to be made. Mr. HARDY. You presuppose that wherever the Employment Service is that there is going to be a certain number of competent people to run it? Mr. WEBB. I do. Mr. HARDY. That being the case, is there any reason that the Veterans' Placement Service will suffer any if operated by the Federal Security Agency? Mr. WEBB. It is a question, Congressman, of relationships. I wanted to read you one sentence from the President's statement on this plan, if you will give me just one second. I think he stated very well that very point. He stated this: The provision of a Nation-wide system of public employment offices which assist workers to get jobs and employers to obtain labor, belongs under the leadership of the Secretary of Labor. Within our Federal Government the Department of Labor is the agency primarily concerned with the labor market and problems of employment. The Department of Labor already has within its organization many, but not all, of the resources needed for the full performance of its duty. I will skip one sentence, and then continue with: I consider it necessary and desirable that these facilities of the Department of Labor should now be augmented by the other major operating agencies in the field of employment. That is, the United States Employment Service and the Bureau of Employment Security. These agencies are concerned, as is the Department of Labor, with the full and proper employment of American workers. I think that is the statement, Congressman, that covers that point. That is a statement as to the relationship that the plan endeavors to accomplish. Mr. HARDY. I do not see where that ties in too well with that. That does not answer my question in connection with the Veterans' Placement. I cannot see the distinction where you have presented any real argument that it would suffer in particular from any transfer. Mr. WEBB. The veteran program, the program for the employment of veterans, is one in which the Government would desire to emphasize the obtaining of employment rather than paying unemployment compensation. Mr. HARDY. That is what we are supposed to do. Mr. WEBB. Yes; but you have these relationships in the Department of Labor that have to do with all of the other activities in the Department that are tied together under the leadership of the Secretary to emphasize doing a good job of placement. Mr. HARDY. That perhaps gets us back to a fundamental question as to whether the Department of Labor can do anything to create jobs or whether they can help to locate jobs. They do have to get those jobs through industry, do they not? Mr. WEBB. That is right. Mr. HARDY. There is a question in my mind as to whether the Department of Labor is in a better position to actually find jobs for workers than would be the Department of Commerce, for instance. Mr. BENDER. Mr. Busbey? Mr. BUSBEY. Mr. Webb, I hope you will bear with me inasmuch as I am not as familiar with the workings of your Department as I probably should be, but am I right in assuming that it would be one of the functions of your Department to come before the committees of the Congress and justify what someone in the executive branch has done in the way of legislation? Mr. WEBB. No, sir; it is not. The Department justifies its own appropriations to the Congress, thereby facilitating a direct contact, and I appear only on such matters as the over-all budget and reorganization plans when a committee requests me to do so. Mr. BUSBEY. I had in mind a question covered awhile ago which had been previously covered on two occasions. The President had a reorganization plan last year, and you gave certain testimony as to it. Now the President has another reorganization plan this year and you come here again and take an opposite viewpoint. What I want to know is if this reorganization plan does not go through will I be right in assuming that should the President submit a third plan that was entirely different from the other two plans would you also justify that plan? Mr. WEBB. I would say this: Conditions are not the same this year as they were last year. Things have intervened in the meantime, particularly since the program last year was rejected by the Congress, and if this plan should be rejected, and if the President should decide that he wishes to make another effort to place this employment function in the Department of Labor, I would be here to give the committee as good information as I could. If the committee requested my views on it, I would be here to give them those views. Mr. BUSBEY. Regardless of how different those views might be from the President's? Mr. WEBB. Well, I would give the committee the best views that I had. I would feel very badly if I had to say that I thought the President was wrong. I certainly would give you the best views that I have. Mr. BUSBEY. Let us arrive at it another way: Have you ever been here before the Congress and opposed any plan or views of the President? Mr. WEBB. No; I have not. Mr. BUSBEY. Mr. Snyder was exploring an idea that I would like to explore a little further on the item of three-tenths of 1 percent. This accumulation, or excess of funds in the general revenue over expenditures, if I recall rightly you stated this plan has not been in operation long enough to think about a change in the item of threetenths of 1 percent. Also, that we ought to allow it to perform a few years longer; is that correct? Mr. WEBB. Yes, sir. Mr. BUSBEY. What would be wrong with a plan whereby, as we see this fund going into the general revenue, reaching a certain point, we will say, of $500,000, or $500,000,000 in excess of income or expenditures, automatically reducing it to two-tenths of 1 percent. Then, if the excess fell below $500,000,000 automatically to raise it up to three-tenths of 1 percent. In other words, have a system whereby it went up and down according to the excess of money paid into the general revenue fund? Mr. WEBB. I think it would be entirely within your province. I would say this: You can make any change in the system that you wish. Mr. BUSBEY. I know that, but I am trying to get your views on it, and what you would recommend. Mr. WEBB. I want to point out that it would involve a fundamental change in the revenue statute, the revenue part of the Security Act, and it would require the allocation of these funds to this specific purpose, which is not in the act at this time, as I understand it. Mr. BUSBEY. Forgetting about the specific allocation of funds, and leaving that part of the law just as it is, what do you say? Mr. WEBB. Frankly, I say that one reason I hate to make a recommendation about this is that the Social Security Commissioner has made a recommendation in his annual report as to the three-tenths of 1 percent being reduced. That matter will come up for consideration in the executive branch. It will be my duty at that time to give consideration to it. Mr. BUSBEY. What is your opinion now regarding that? Should it be reduced to two-tenths of 1 percent? Mr. WEBB. My opinion is that it should be sufficient to cover the needs for funds for the program. If experience indicates that it can be less, and if Congress wishes to have this revenue specifically allocated for specific purposes, then it might be reduced. Mr. BUSBEY. You have me at a disadvantage. You have had the experience of dealing with these things, and I have not. That is the reason I ask you the specific question. In your opinion, should it be reduced to two-tenths of 1 percent? Mr. WEBB. I do not have a firm opinion at this time. Mr. BUSBEY. Let us not go off and talk about the birds and the bees. Let us talk about the subject matter at hand. Mr. WEBB. Let me say that I do not have an opinion at this time. It will be necessary for me to review the matter carefully, since it has been brought up by the Social Security Commissioner in his annual report now being transmitted to the Congress. Mr. BUSBEY. Do you mean that it has been put in the report without having consulted you? Mr. WEBB. No. Mr. BUSBEY. Has he consulted you? Mr. WEBB. That recommendation has been put in the report that he submitted to the Bureau for clearance for transmission to the Congress. Mr. BENDER. Those questions and answers remind me of letters that we get from the Department of Labor. They never answer "Yes" or "No.". Is the answer "Yes" or "No"? Mr. BUSBEY. I dislike to say on the record, that in my opinion you are being evasive. I am not asking any tricky questions. I am asking you a very simple and fundamental question, which in my opinion is very important to legislation that we have under discussion. Mr. WEBB. May I state the exact facts as they occurred? Mr. BUSBEY. Yes; in your own words. If you can answer my question in that way, fine. Mr. WEBB. The Social Security Commissioner submitted to the Bureau of the Budget his annual report for clearance. In that annual report was a recommendation that this three-tenths of 1 percent be reduced. The Bureau of the Budget took no action to eliminate it, and it has been transmitted to the Congress, or will be shortly, with |