Down to Business

The Hoover Commission, which has been poking into the jerry-built U.S. bureaucracy for months, got around to the Government's business-regulating agencies last week and made its most sweeping suggestions for changes to date. It urged that the power of the Department of Commerce be greatly increased by giving it the jurisdiction over all U.S. transportation, now scattered in a dozen bureaus. Under the Hoover plan, Commerce would take over: P: The Interstate Commerce Commission's executive powers over highway and rail traffic (including responsibility for safety and railroad consolidation plans). P: All functions of the Office of Defense Transportation. P: The Maritime Commission's operations involving shipping purchases, sales, loans and subsidies. P: Direction of the Public Roads Administration, now in the Federal Works Agency. P: Control of the Coast Guard, now in the Treasury Department. P:CAB's job of making air safety rules.

The Hoover Commission also recommended that the Treasury get control of three credit agencies, now independent: the Reconstruction Finance Corp., the Federal Deposit Insurance Corp. and the Export-Import Bank. To coordinate the 30 other U.S. lending agencies, and to advise the President on money matters, it suggested the setting up of a National Monetary and Credit Council.

A Hoover task force report, awaiting approval by the full commission, suggested some further shifts. The Federal Reserve Board's power to fix stock-market margins would be transferred to the Securities & Exchange Commission, and the Reserve Board cut from seven to three members. At the same time, the board would be given more monetary and fiscal influence by getting exclusively the important job of buying & selling U.S. bonds to stabilize the market. This job is now done by the powerful Federal Open Market Committee, five of whose twelve members are Reserve Bank presidents elected by commercial bankers. The board would also be represented on the new Monetary Council.

The recommendations promptly brought criticism from some bankers. They objected to any increase in centralization and wanted to keep bond operations in the hands of the Federal Open Market Committee. Said ex-President Hoover, who has had long experience with both businessmen and bureaucrats: "By the time it is all over, we expect an aggregate of 100% of those affected to resist reforms."

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