"(2) may include provisions for the appointment and compensation of the head and one or more other officers of any agency (including an agency resulting from a consolidation or other type of reorganization) if the President finds, and in his message transmitting the plan declares, that by reason of a reorganization made by the plan such provisions are necessary. The head so provided for may be an individual or may be a commission or board with two or more members. In the case of any such appointment the term of office shall not be fixed at more than four years, the compensation shall not be at a rate in excess of that found by the President to prevail in respect of comparable officers in the executive branch, and, if the appointment is not under the classified civil service, it shall be by the President, by and with the advice and consent of the Senate, except that, in the case of any officer of the municipal government of the District of Columbia, it may be by the Board of Commissioners or other body or officer of such government designated in the plan; "(3) shall make provision for the transfer or other disposition of the records, property, and personnel affected by any reorganization;

(4) shall make provision for the transfer of such unexpended balances of appropriations, and of other funds, available for use in connection with any function or agency affected by a reorganization, as he deems necessary by reason of the reorganization for use in connection with the functions affected by the reorganization, or for the use of the agency which shall have such functions after the reorganization plan is effective, but such unexpended balances so transferred shall be used only for the purposes for which such appropriation was originally made;

“(5) shall make provision for terminating the affairs of any agency abolished. "SEC. 5. (a) No reorganization plan shall provide for, and no reorganization under this Act shall have the effect of

"(1) abolishing or transferring an executive department or all the functions thereof or consolidating any two or more executive departments or all the functions thereof; or

(2) continuing any agercy beyond the period authorized by law for its existence or beyond the time when it would have terminated if the reororganization had not been made; or

"(3) continuing any function beyond the period authorized by law for its exercise, or beyond the time when it would have terminated if the reorganization had not been made; or

"(4) authorizing any agency to exercise any function which is not expressly authorized by law at the time the plan is transmitted to the Congress; or "(5) increasing the term of any office beyond that provided by law for such office; or

“(6) transferring to or consolidating with any other agency the municipal government of the District of Columbia or all those functions thereof which are subject to this Act, or abolishing said government or all said functions. "(b) No provision contained in a reorganization plan shall take effect unless the plan is transmitted to the Congress before April 1, 1953." [Reorganization Act of 1949, Public Law 109 (63 Stat. 203-205).]

The above subsection (b) was amended by act of February 11, 1953, extending from April 1, 1953, to April 1, 1955, final date for transmission of reorganization plans to Congress (Public Law 3, 83d Cong. (67 Stat. 4)).

The reorganization plan issued under the above legislation provided new management outlines of the bank. Section 2 of the reorganization plan established a deputy director, to perform such functions as the Managing Director may from time to time prescribe and to act as the Managing Director during a vacancy in the office of Managing Director. Section 3 established the position of Assistant Director with civil-service status, to perform such duties as the Managing Director from time to time may prescribe (Reorganization Plan No. 5 of 1953, H. Doc. No. 135).

Sections 4, 5, 6, and 7 of the reorganization plan are set out because of their importance:

SEC. 4. FUNCTIONS TRANSFERRED TO THE MANAGING DIRECTOR.-All functions of the Board of Directors of the Export-Import Bank of Washington are hereby transferred to the Managing Director.

"SEC. 5. GENERAL POLICIES.—The National Advisory Council on International Monetary and Financial Problems shall from time to time establish general lending and other financial policies which shall govern the Managing Director in the conduct of the lending and other financial operations of the Bank.

"SEC. 6. PERFORMANCE OF TRANSFERRED FUNCTIONS.-The managing Director may from time to time make such provisions as he deems appropriate authorizing

the performance of any of the functions of the Managing Director by any other officer, or by any agency or employee, of the Bank.

"SEC. 7. ABOLITION.—The following are hereby abolished: (1) The Board of Directors of the Export-Import Bank of Washington, including the offices of the members thereof provided for in section 3 (a) of the Export-Import Bank Act of 1945, as amended; (2) the Advisory Board of the Bank, together with the functions of the said Advisory Board; and (3) the function of the Chairman of the Board of Directors of the Export-Import Bank of Washington of being a member of the National Advisory Council on International Monetary and Financial Problems. The Managing Director shall make such provisions as may be necessary for winding up any outstanding affairs of the said abolished boards and offices not otherwise provided for in this reorganization plan.

"SEC. 8. *** [Ante, p. 17, Reorganization Plan No. 5 of 1953.]

The questions squarely raised by sections 4 and 5 of the plan relate to their effect upon the relationship between the Export-Import Bank and the National Advisory Council. Certainly section 5 of the plan allowing the National Advisory Council to "establish general lending and other financial policies" of the ExportImport Bank would seem to create a wider authority than its former power to merely "coordinate" under the Bretton Woods Agreements Act (Bretton Woods Agreements Act of 1945, Public Law 171, 79th Cong. (59 Stat. 512)). Yet apparently this construction would give to the National Advisory Council certain policymaking poweres formerly held by the Board of Directors of the ExportImport Bank in spite of the fact that section 4 of the plan transfers "all functions of the Board of Directors" to the Managing Director.

Section 6 of the plan provides that the Managing Director may authorize the performance of any of the functions of the Managing Director by any other officer or by any agency or employee of the Bank. Section 7 eliminates the function of the Chairman of the Board of Directors of the Export-Import Bank of being a member of the National Advisory Council on International Monetary and Financial Problems.

As may be observed from the foregoing, the net effect of this reorganization was to centralize authority and responsibility. The plan, though following the general recommendations of the Hoover Commission for centralizing authority, differed, in that the Hoover Commission had recommended that the bank be placed under the Department of the Treasury.

PART 3. CONCLUSION

Through all the various changes and modifications in the Export-Import Bank, a definite theme or pattern has been consistent. From its inception the purpose of the bank, whether declared by Executive order or legislative direction, has been to finance and facilitate the export-import trade of the United States. The unchanging policy has been to encourage and supplement private capital financing and not to compete with it. Despite the fact that this institution has traveled a road from depression, to war, to reconstruction, the purpose and policy have remained intact.

Virtually every Congress, except in war years, has managed to legislate upon the bank's existence or its activities. The legislation enacted has been broad rather than restrictive, thus enabling the bank to meet diverse needs. This has been to good effect in many instances but it has also created problems. One may well ask whether under the broad language of the Export-Import Bank Act of 1945, as amended, the bank was intended to continue in making direct loans to foreign governments for the purpose of reconstruction and development. The 1945 legislation was far less specific than the 1940 act, which stated clearly that it was enacted to assist in development of resources and stabilize economies, and assist in the orderly marketing of commodities of countries of the Western Hemisphere. Even an answer to this question, which would deny the bank the right to continue making reconstruction and development loans would not solve matters, however, for there remains the gray area of doubt as to what constitutes reconstruction and development and what constitutes an. ordinary commercial-type loan.

Even if it be settled that the bank may continue to operate within the reconstruction and development field the question remains: Should the bank continue in that field when there is an international bank operating in that area?

Legislation and presidential action have left doubt as to the management and policymaking of the bank. The word "coordinate" remains a term still eluding definition and yet, upon that nebulous concept and the meaning of sections 4 and 5 of Reorganization Plan No. 5 of 1953, may well depend the future course

and activities of the bank. This is so because if the power of the National Advisory Council has been enlarged by sections 4 and 5 of Reorganization Plan No. 5, so that the National Advisory Council can mandate policy to the Managing Director of the bank, then the National Advisory Council on International Monetary and Financial Problems, actually holds the residual power to control. This becomes an important question when it is remembered that the bank no longer enjoys a vote on the National Advisory Council. Yet, if "coordinate" means advise and integrate policies if possible, but not mandate, and no new power rests in National Advisory Council, then the power and future of the bank resides with its Managing Director.

STAFF MEMORANDUM

CERTAIN LEGAL ASPECTS OF REORGANIZATION PLAN No. 5 OF 1953
(By H, K. Cuthbertson, Jr.)

1. RELATIONSHIP OF THE

EXPORT-IMPORT BANK TO THE NATIONAL ADVISORY COUNCIL AND TO THE ADVISORY BOARD TO THE EXPORT-IMPORT BANK PRIOR TO REORGANIZATION PLAN NO. 5

The functions of both the Export-Import Bank and the National Advisory Council on International Monetary and Financial Problems (hereinafter referred to as NAC) as they existed prior to plan No. 5 were set out in 1945 under the Export-Import Bank Act of 1945 and the Bretton Woods Agreement Act,2 respectively.

Under the Export-Import Bank Act the "management" of that bank was vested in its Board of Directors. In addition an Advisory Board consisting of the Secretaries of State, Treasury, Commerce, the Chairman of the Board of Governors of the Federal Reserve System and the Chairman of the Export-Import Bank who was to serve as Chairman of the Advisory Board, was set up by the same act.4 This Board could make recommendations to the Export-Import Bank's Board of Directors and should be consulted by the Directors "on major questions of policy." Congress also directed in the bank act of 1945 that the Export-Import Bank was to constitute an independent agency of the United States.

The Bretton Woods Agreement Act which affects the authoritative functions of both the Export-Import Bank and the NAC provided for the participation of the United States in both the International Monetary Fund and the International Bank for Reconstruction and Development and established the NAC. The NAC was to have the same composition as the Advisory Board of the Export-Import Bank with this exception; the Chairman of the NAC was to be the Secretary of the Treasury. Its purpose was "to coordinate the policies and operations of the representatives of the United States on the fund and the International Bank 1 Public Law 173, 79th Cong.; 12 U. S. C., sec. 635-635h. Public Law 171, 79th Cong.; 22 U. S. C., sec. 286-286-1.

"The management of the Export-Import Bank of Washington shall be vested in a Board of Directors consisting of the Administrator of the Foreign Economic Administration, who shall serve as Chairman, the Secretary of State, and three persons appointed by the President of the United States by and with the advice and consent of the Senate. The Secretary of State to such extent as he deems it advisable, may designate to act for him in the discharge of his duties as a member of the Board of Directors any officer of the Department of State who shall have been appointed by and with the advice and consent of the Senate." Public Law 173, sec. 3 (a) (1), 79th Cong.; 12 U. S. C., sec. 1 (a) (1).

"There shall be an Advisory Board consisting of the Chairman of the Export-Import Bank of Washington, who shall serve as Chairman, the Secretary of State, the Secretary of the Treasury, the Secretary of Commerce, and the Chairman of the Board of Governors of the Federal Reserve System, which shall meet at the call of the Chairman. The Advisory Board may make such recommendations to the Board of Directors as it deems advisable, and the Board of Directors shall consult the Advisory Board on major questions of policy." Public Law 173, sec. 3 (d), 79th Cong.; 12 U. S. C., sec. 635 a (d).

Supra note 4.

"The Export-Import Bank of Washington shall constitute an independent agency of the United States and neither the bank nor any of its functions, powers, or duties shall be transferred to or consolidated with any other department, agency, or corporation of the Government unless the Congress shall otherwise by law rovile." Public Law 173, sec. 3 (f), 79th Cong.; 12 U. S. C., sec. 635 a (f).

"In order to coordinate the policies and operations of the representatives of the United States on the fund and the bank and all agencies of the Government which make or participate in making foreign loans or which engage in foreign financial, exchange, or monetary transactions, there is hereby established the National Advisory Council on International Monetary and Financial Problems (hereinafter referred to as the 'Council'), consisting of the Secretary of the Treasury, as Chairman, the Secretary of State, the Secretary of Commerce, the Chairman of the Board of Governors of the Federal Reserve System, and the Chairman of the Board of Trustees of the Export-Import Bank of Washington." Public Law 171, sec. 4 (a), 79th Cong.; 22 U. S. C. sec. 286b (a).

and of all agencies of the Government which make or participate in making foreign loans or which engage in foreign financial, exchange or monetary transactions." 8 The NAC was to effect this coordination "by consultation or otherwise" "and to help effectuate this the Export-Import Bank was required to keep the NAC fully informed of its activities." 10

The problem then is to determine from the foregoing statutes the exact apportionment of the total sphere of authority over the operations of the ExportImport Bank; the solution to which is not without its difficulties.

It would seem, at the outset, that the Advisory Board could make recommendations" to the Export-Import Bank's Board of Directors and they in turn were charged with the duty to "consult the Advisory Board on major questions of policy."12 However, there was no statutory power in the Advisory Board to enforce its recommendations. 13

On the other hand the relationship between the Export-Import Bank and the NAC was not free from doubt although characterized only by the power of the NAC to coordinate the policies and operations of the fund, the International Bank, the Export-Import Bank, and other agencies. Even while hearings on the Bretton Woods Agreement Act were being held difficulty was experienced in interpreting the word "coordinate" by members of the Senate Banking and Currency Committee.14 In practice the same confusion has arisen over the word's scope, with the Chairman of the NAC apparently taking the position that coordination means total policy making while the Export-Import Bank has maintained that it has independent powers over and above the coordinating powers of the NAC.

A basic rule of statutory construction is that when there is an ambiguity in a statute, other statutes in para materia, may be consulted in order to determine the legislative intent and further that if such statutes are in apparent conflict they are so far as reasonably possible, construed so as to be in harmony with one another.15 Certainly the history of the NAC coordination-clause of the Bretton Woods Agreement Act both prior and subsequent to its passage allow it to be characterized as ambiguous. Therefore, the Export-Import Bank Act of 1945 and the Bretton Woods Agreement Act should be placed side by side in the stereoscope for examination and clarification.

Taking that part of the Export-Import Bank Act of 1945 setting up the Advisory Board for the Export-Import Bank which was discussed previously 16 and placing it beside the NAC coordination-clause of the Bretton Woods Agreement's Act 17 it would seem that the coordination intended by Congress was the limited one of harmonizing the activities of the Export-Import Bank with those of the International Bank; a prevention of conflict. Otherwise, there would be no reason for Congress to set up the Advisory Board with which the Export-Import Bank Directors should consult on "major questions of policy," for such a func

Supra note 7.

"The Council shall coordinate, by consultation or otherwise, so far as is practicable, the policies and operations of the representatives of the United States on the fund and the bank, the Export-Import Bank of Washington and all other agencies of the Government to the extent that they make or participate in the making of foreign loans or engage in foreign financial, exchange or monetary transactions." Public Law 171, sec. 4 (b) (3), 79th Cong.; 22 U. S. C., sec. 286b (b) (3).

10 The representatives of the United States on the fund and the bank, and the Export-Import Bank of Washington (and all other agencies of the Government to the extent that they make or participate in the making of foreign loans or engage in foreign financial, exchange, or monetary transactions) shall keep the Council fully informed of their activities and shall provide the Council with such further information or data in their possession as the Council may deem necessary to the appropriate discharge of its responsibilities under this act." Public Law 171, sec. 4 (c), 79th Cong.; 12 U. S. C., sec. 286b (c).

11 "To recommend is to present as one's advice or choice or as having one's approval and involves the idea that another has the final decision." People of Virgin Islands v. Price (181 F. 2d 394, 396).

12 In Commissioner of Internal Revenue v. John A. Whalthen Distillery Co. (147 F. 2d 998, 1001), the court said: "The word 'consult' means 'to seek the opinion or advice of another; to take counsel; to deliberate together; to confer to apply for information or instruction. *** Webster's New International Dictionary, 2d edition. There is no suggestion that consulting implies obtaining consent."

13 Supra note 4. This is the only reference to the Advisory Board in the Act.

14 "Senator TAFT. I still do not think it is clear. I think it certainly ought to be explained on the floor of the Senate if that is the fact, because this Bretton Woods bill says: The Council shall recommend to the President general policy directives for the guidance of the representatives of the United States on the fund and the bank. I mean that the Council actually directs. They have power to determine policy completely. Now, that policy is not quite so clear over the Export-Import Bank. It says in (b) (3) that they shall coordinate the policies and operations of the Export-Import Bank by consultation or otherwise. Then after you pass that you come and set up a brand-new Export-Import Bank bill, the ExportImport Bank bill of 1945, and in that you vest the management in the Export-Import Bank Board of Directors, and you make it clear that these same five people are only advisory. Only advisory; not policy determining. And it seems to me you repeal the provisions of the Export-Import Bank bill if you come and pass it afterward." Hearings before Senate Banking and Currency Committee, 79th Cong., on H. R. 3771, July 17 and 18, 1945. See also Congressional Record of July 20, 1945, pp. 7958 and 7959. 15 Sutherland, Statutory Construction, sec. 5201.

16 Supra note 11.

17 Supra note 9.

tion would be included in the extremely broad definition of "coordination" contended for by the NAC.

Further, the Bretton Woods Agreement Act contains a number of additional provisions which give the NAC supervisory power over the United States representatives on the fund and International Bank; provisions which would not seem to be necessary if the word "coordination" would give the NAC general authority over policy.18

Certainly the limited meaning of coordination is the one commonly given usage; authority to fit together two or more equal forces rather than the exercise of authority in a vacuum. It is apparent therefore that the policy-making power over the Export-Import Bank under the 1945 acts rested with the Board of Directors of that bank except where such policy conflicted with the policy of the International Monetary Fund, International Bank, or other agencies of the Government making or participating in the making of foreign loans or engaging in foreign financial, exchange, or monetary transactions. Indeed this was the position of Dean Acheson, then Assistant Secretary of State, when he explained the Bretton Woods Agreement Act before the Senate Banking and Currency Committee.19

This analysis would be incomplete if the subsequent interpretation of and practice under the Bretton Woods and Export-Import Bank Acts were not set out. Unfortunately, this area too, has been far from clear and is probably the genesis of the problem as it exists today. In general it would appear that the NAC has, in fact, provided the Export-Import Bank with overall policy direction with the bank constantly maintaining that it had independent powers to establish policy. Actually the issue was never met, for the NAC has always deferred to the Chairman of the Export-Import Bank's Board of Directors on any particular matter.

In conclusion it should be noted that no attempt has been made here to set out the precise scope of the NAC's policy making authority over the ExportImport Bank. The science of semantics is too illusory for this; only general areas can be blocked out. However, it can be assumed that the area of policymaking power given to the NAC is quite large in view of the extent of operations of the World Bank, and those governmental agencies which in the catchall phrase, "make or participate in the making of foreign loans or engage in foreign financial, exchange or monetary transactions." Certainly the statutes discussed require the NAC to weigh the actions of the Export-Import Bank in one side of a balance as against the actions of another agency in the foreign finance picture and not isolated examination unrelated to anything else.

II. THE LEGAL EFFECT OF A REORGANIZATION PLAN

The precise legal effect of a reorganization plan has nowhere been specifically spelled out either in the case law or by the legal writers.20 Nevertheless Congress itself has given us some very clear suggestions to aid in this inquiry.

18 "The Council, after consultation with the representatives of the United States on the fund and the bank, shall recommend to the President general policy directives for the guidance of the representatives of the United States on the fund and the bank."

"The Council shall advise and consult with the President and the representatives of the United Stateson the fund and the bank on major problems arising in the administration of the fund and the bank." "Whenever, under the articles of agreement of the fund or the articles of agreement of the bank, the approval, consent, or agreement of the United States is required before an act may be done by the respective institutions, the decision as to whether such approval, consent, or agreement shall be given or refused shall (to the extent such decision is not prohibited by sec. 5 of this act) be made by the Council, under the general direction of the President. No governor, executive director, or alternate representing the United States shall vote in favor of any waiver of condition under art. V, sec. 4, or in favor of any declaration of the United States dollar as a scarce currency under art. VII, sec. 3, of the articles of agreement of the fund, without prior approval of the Council."

Public Law 171, 79th Cong.; 22 U. S. C. 286b (b) (1), 286h (b) (2) and 286h (b) (4).

19 "Senator TAFT. 'Well, "coordinate" is a word that doesn't mean anything. Does it give them the power to issue directives to the Export-Import Bank? Mr. Crowley says "No","

"Mr. ACHESON. 'Well, if it is necessary to coordinate, "Yes." If it is a separate matter of policy which has nothing to do with the operations of other agencies, why, then "No"." Hearings before the Senate Banking and Currency Committee, 79th Cong., on H. R. 3771, July 17 and 18, 1945.

20 Neither has the constitutionality of any of the many reorganization acts (see S. Rept. 638 of the 79th Cong.). In 1935 the United States Supreme Court avoided the issue by holding that subsequent acts of Congress, such as appropriations, had ratified the executive actions. Swayne and Hoyt v. U. S. (300 U. S. 297).

As an incident of the separation of powers is the corollary that the legislative function cannot be delegated to any other governmental agency. More ignored than heeded the maxum was not used until 1935 to strike down any congressional grant of power. See 20 New York University Law Quarterly Review 347. Then in Schechter Poultry Co. v. U. S. (295 U. S. 495) the NIRA was held unconstitutional and specific implementation made to the no-delegation rule. It is suggested that the constitutional status of the Reorganization Act of 1949 can only be resolved by a careful study of the Schechter case, the NIRA, the Reorganization Act of 1949 and Yakus v. U. S. (321 U. S. 414), and the statute it declared constitutional, the Emergency Price Control Act of January 30, 1942 which some believe in effect overruled Schechter."