EXECUTIVE OFFICE OF THE PRESIDENT PRESIDENT'S ADVISORY COUNCIL ON EXECUTIVE ORGANIZATION January 30, 1971. DEAR MR. PRESIDENT: The President's Advisory Council on Executive Organization herewith submits its report on the independent regulatory agencies. Our recommendations concerning seven regulatory agencies the Interstate Commerce Commission, the Civil Aeronautics Board, the Federal Maritime Commission, the Securities and Exchange Commission, the Federal Power Commission, the Federal Trade Commission, and the Federal Communications Commission-aim to establish a new framework within which the agencies might be structured now and for the future. As we make these recommendations for organizational change, we recognize that consideration is being given to questions of the amount and kind of regulation needed today. Although the regulatory laws may need revision, changes in regulatory structure can and indeed should be implemented in advance of changes in the substantive laws. The existing structure, because of its inherent and perhaps unavoidable deficiencies, cannot be expected to accommodate these revised mandates which may require that regulation reflect the pace of change in the regulated industries, the interdependence of elements of the economy, and the public interest. A more effective and objective regulatory process, better integrated with other processes of government, requires a new organizational framework for regulation. We have observed that, as economic regulation has evolved largely on an as-needed basis, it has not developed a breadth of perspective necessary to encompass the needs of the public and the regulated industries. As each commission was created, it undoubtedly served the needs as seen at that time. The question we asked was: Are the statutorily expressed intentions of Congress and the changing demands of the national economy and of the public best served by the present structure of regulatory administration? We concluded that they are not. Changes in public requirements and characteristics of the regulated industries compel the establishment of a new structural framework to better serve today. For the future, effective regulation depends upon recognizing that the national economy involves an increasingly interrelated set of activities, demanding a greater degree of coordination, consistency of policy, and cooperation between the public and private sectors of the economy. We have not prescribed all the organizational details of the proposed restructured agencies. Internal agency organization should reflect the participation and contribution of others intimately familiar with the operating details of each agency, the changes in enabling statutes which may be enacted concurrent with changes in structure, and, in the final analysis, the organizational viewpoint of each agency's administrative head. In reaching our conclusions we relied heavily on the opinions of participants in, and observers of the regulatory process, together with our own analysis of the history, current needs and current structure of regulation. Our analysis also involved detailed consideration of existing regulatory statutes, previous studies, and expert commentary. Although our recommendations are presented together, each should be viewed on its own merits. We feel that the composite program offers the best opportunity for improved regulation, but we also believe that each proposal, in and of itself, will serve to benefit the regulatory process. Thus, for each recommendation, we separately set forth the underlying considerations and rationale pertaining to our conclusions. Due attention should be given to differences in the responsibilities of the regulatory agencies in evaluating these proposals. For while we have emphasized similarity in our findings, others may, in noting differences, arrive at divergent conclusions and, as a consequence, different proposals for change. In commending these proposals to you, we are mindful of the sweeping change in industry and governmental practice implicit in them. We are also well aware of their economic implications. We believe, therefore, that these recommendations should be made public in order to generate broad discussion of the Federal role in economic regulation. In the public debate which publication of these proposals will generate, views which we have not heard and problems which we have not un covered or defined completely may emerge. Ideas for improving not only regulatory structure, but regulatory statutes and administrative procedures as well are likely to be offered. We believe you should have the benefit of such public discussion in order to aid you in determining which, if any, proposals to make to the Congress. Respectfully submitted, payaan ROY L. ASH, Chairman. |