Regional Organization of the Social Security Administration a Case Study 9780231889360

Table of contents :
Preface
Table of Contents
I. The Value of the Regional Organization of the Social Security Administration as a Type
II. SSA Regional Organization: Its Nature, Advantages and Technical Problems
III. The Evolution of the Organizational Pattern of the Social Security Administration
IV. The Organization and the Activities of the Regional Offices
V. The Determination of Area and the Location of Headquarters
VI. The Determination of Lines of Supervision
VII. The Difficulties and Advantages of Functionalization
VIII. Basic Techniques of Clearance and Coordination: Administrative Orders and Field Units
IX. Techniques of Communication and Control
X. The Regional Director: General Regional Command
XI. Conclusion
Index

Citation preview

STUDIES IN HISTORY, ECONOMICS AND PUBLIC LAW Edited by the FACULTY OF POLITICAL SCIENCE OF COLUMBIA UNIVERSITY

Number 571

REGIONAL ORGANIZATION OF THE SOCIAL SECURITY ADMINISTRATION A CASE STUDY BY

JOHN A. DAVIS

REGIONAL ORGANIZATION OF THE SOCIAL SECURITY ADMINISTRATION A CASE STUDY BY

JOHN A. DAVIS, PH.D. Visiting Lecturer, The Ohio State University

NEW

York

COLUMBIA UNIVERSITY PRESS I950

COPYRIGHT,

1950

BY

COLUMBIA UNIVERSITY P R E S S

PRINTED I N T H E UNITED STATES OF AMERICA

Published in Great Britain, Canada, and India by GEOFFREY CUMBERLEGE

OXFORD UNIVERSITY PRESS London, Toronto, and Bombay

PREFACE THE increase in the service and regulatory activities of the Federal government has caused Federal departments to develop more and more establishments in the field. Along with this process has come the necessity for the organizational consolidation of decentralized units, especially on the regional level. The Social Security Board was an early attempt to provide for the overall regional organization of an entire Federal agency. This study was made to investigate the organizational problems involved in the regional administration and organization of the Social Security Board and its successor, the Social Security Administration ( S S A ) . The treatment of the regional organization of the Social Security Board and the SSA in this book is entirely in terms of organizational problems. The volume deals with such matters as the effect of central organization upon regional organization, the determination of regional headquarters and geographical area, the determination of lines of supervision, the problems which functiohalization introduces into field supervision especially in the administration of federal-state programs, the difficulties of field coordination, clearance, communication, and control, and the nature of general regional command. Except for simple descriptive material this volume is not concerned with the content or the techniques of the substantive jobs executed on the regional level by the various bureaus of the Social Security Board and the SSA, since the object is not to discuss regional administration in terms of federalstate relations or programs and nationally administered programs, but in terms of organizational matters. For this same reason the degree of substantive authority enjoyed by the various regional representatives of the bureaus of the Social Security Board and the SSA has not been a matter of main concern because such an analysis would be possible only through an exhaustive description of the programs of Board 5

6

PREFACE

and S S A constituents as well as of federal-state matters in general. The devolution of authority to the regional level might better be left to studies on the individual programs of the Board and the S S A , where, to a large extent, it has already been considered. In making this study the writer has attempted to place much emphasis on historical and descriptive data as well as on matters of organizational theory involved in the regionalization of the Board and the S S A . A period of approximately a year and a half was spent in the study and observation of both the Board and the S S A at regional offices in New York, Philadelphia and Washington, and at headquarters in Washington. It was not possible to continue field observation during the writing of this book; therefore, events after December 1947 are not recorded herein. Some references to subsequent events have been indicated in the footnotes. The author is indebted to many persons. First of all, whatever there is of value in this study results from the stimulation and guidance of Professor Arthur W . Macmahon of Columbia University. Much is also owed to Professor John D. Millett of the same university for his valuable criticism and his instruction as to method. Neither Macmahon nor Millett is responsible for the failings and shortcomings of this study. T o Professor Eveline M. Burns of the New York School of Social W o r k and Professor C. A. Kulp of the Wharton School of Finance the author is indebted for grounding in the fields of social insurance, security, public assistance, and work relief. It would unduly lengthen these remarks to mention all of the persons now or formerly members of the staff of the S S A or the Federal Security Agency who aided the writer. Nevertheless, it would be extremely remiss not to express gratitude for the aid given and for the opportunities made available to the author by Anna M. Rosenberg, John J. Corson, Harry Arthur Hopf, Dean Snyder and Lavinia Engle. However, none of these persons

PREFACE

7

is responsible for the conclusions of this volume. Real gratitude is owed Professor Philip S. Miller of Lincoln University for providing work space. Above all the book was made possible by the assistance and forbearance of Mavis Wormley Davis, the author's wife, and Dorothy Davis Lucas, the author's sister. The study was financed in part by a grant from the Julius Rosenwald Fund. JAD LINCOLN UNIVKBSITY, MABCH,

1950

PA.

TABLE OF CONTENTS PAGI Peeface

5

CHAPTER I The Value of the Regional Organization of the Social Security Administration as a Type

n

CHAPTER II SSA Regional Organization: Its Nature, Advantages and Technical Problems

36

CHAPTER III The Evolution of the Organizational Pattern of the Social Security Administration

51

CHAPTER IV The Organization and the Activities of the Regional Offices

88

CHAPTER V The Determination of Area and the Location of Headquarters

114

CHAPTER V I The Determination of Lines of Supervision

131

CHAPTER VII The Difficulties and Advantages of Functionalization

165

CHAPTER VIII Basic Techniques of Clearance and Coordination: Administrative Orders and Field Units 189 CHAPTER IX Techniques of Communication and Control

213

CHAPTER X The Regional Director: General Regional Command

251

CHAPTER X I Conclusion

286

Index

306

9

CHAPTER I THE VALUE OF THE REGIONAL ORGANIZATION OF THE SOCIAL SECURITY ADMINISTRATION AS A TYPE T H I S book analyzes the regional organization of the Social Security Administration, with special regard to the difficulties of this type of administrative structure and the concepts and techniques to solve its intricate problems. It is important first, therefore, to note the value of the S S A 1 type of regional organization in order to demonstrate that its intricacies and difficulties are worth mastering. The SSA type of regional organization has great utility in any process of rationalizing 2 the Federal field structure. It is the purpose in this chapter to note various approaches to the rationalization of the Federal field, to list their advantages and shortcomings, and to fix the SSA regional organization as an advantageous type of what is, for the time being, the most fruitful approach to the rationalization of the Federal field structure. APPROACHES TO THE RATIONALIZATION

OF T H E

FEDERAL

FIELD STRUCTURE

Experts in public administration, both in and out of Government, have been aware of the increased need for the consolidation and coordination of field activities as the Federal field structure has expanded under the impact of increased Federal services, aid, and regulation. A review of the various 1 The initials SSA will be used in the text to indicate the Social Security Administration. 2 To rationalize is to order, to structuralize, to reorganize so as to integrate, to arrange in a rational organizational pattern. The words rationalizing and rationalization are used in this volume to refer to the process of developing orderly organizational relationship between the scattered and often organizationally unrelated field units of the Federal agencies. II

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ORGANIZATION

OF T H E

SSA

plans proposed b y experts for Federal field structure (some of which were only partly concerned with the problem of rationalization) and a review of past attempts of the Federal government to coordinate its field, indicate the existence of six general approaches to the consolidation and coordination of the Federal field structure. These six general approaches have been revealed i n : ( i ) T h e use of inter-departmental coordinating committees in the field, often along with some kind of convener; ( 2 ) various attempts at overall interagency coordination in the field carried out by a central staff unit to the P r e s i d e n t ; ( 3 ) the proposal to establish common regional areas and headquarters for decentralized Federal organizations; ( 4 ) the proposal to establish regional planning commissions which would develop cooperative planning relations with national, state and local planning commissions, and which would implement the work of Federal field organizations organized into common regional areas and headquarters; ( 5 ) the proposal to establish regional developmental authorities such as T V A ; and ( 6 ) the attempts at the intradepartmental rationalization of regional organizations. Of the six approaches, the first five deal with extra-departmental attempts to rationalize the Federal field structure. T h e discussion which follows reveals that all of these five have severe limitations except for the first two, and part of the third. T h è first, coordinating committees and conveners, are inevitable techniques in any large organization, although they should be held to a minimum. 8 T h e second, overall field coordination by a central staff agency, has not been very successfully executed in the past, but is still needed. W i t h regard to the third, it appears that the increased use of identical regional headquarters by Federal agencies is feasible as well as desirable. It is the sixth approach—attempts at the intra-departmental rationalization of regional organization—which is the most 3 Cf. L. Urwick, The Elements of Administration ( N e w York : Harper 4

Brothers, 1943), pp. 71-74-

THE

V A L U E O F SSA R E G I O N A L

ORGANIZATION

13

fruitful one to follow at present, although the overall task of rationalizing the Federal field must be concerned also with extra-departmental methods. The success of the latter, however, depends in large measure on the development of intradepartmental regional organization. The S S A kind of regional organization represents a type of multiple regional organization which is especially significant for the consolidation of regional and field organization within departments, 4 and con4 T h e discussion in this volume concerns the rationalization of departmental organization on the regional level. It is assumed that this will result in the rationalization of departmental field organization on other field levels. It is the regional level which is crucial. Moreover, multiple organization, which this volume proposes for the regional level, is as desirable and as workable for lower field levels as it is for the regional level. T h r e e instances of retreat from regional organization should be noted since they challenge the basic assumption of this book. First, on February 1, 1949, the Veterans Administration abolished the supervisory duties of its branch offices (more properly termed regional offices) over its regional offices ( m o r e properly termed field offices). T h e supervisory responsibilities of the branch offices were transferred to the various assistant administrators in Washington, who carried out surveillance on a functional basis. T h e old branch offices, re-named district offices, kept the operating activities dealing with insurance claims and benefits. See " Memorandum of Carl R. Gray, Veterans Administrator, to the Executive Assistant Administrator," J a n u a r y 3 1 , 1949. (Typewritten.) It remains to be seen if it is possible for the many assistant administrators in Washington to provide coordinated technical supervision over 70 regional (field) offices. T h e abolishment of the regional level of supervision will probably result in a conflict of specialty, delay, span of control problems at the center, increased travel and communication costs, and a loss of customer convenience. Second, as a result of the 1948 recommendation of the House Appropriations Committee, the Public Housing Administration abolished its five field offices (properly termed regional offices), centralized much of its program and most of its facilitative activities in Washington, and established ten smaller field offices (regional offices). T h r e e field divisions at Washington, each headed by an assistant commissioner, were established for the supervision of the field (regional) offices, with each assistant commissioner responsible for surveillance of the offices in a given geographical area. See Public Housing Administration, Reorganization Memorandum, Organization Powers and Functions, Code 15-6 (Washington, D. C . : Housing and Home Finance Agency, October 29, 1948). (Processed.) A f t e r the Housing Act of 1949 (Public Law 171, 81st Cong.) much authority as to program matters was decentralized from the three assistant commissioners to the field (regional) offices. F o r the most part, only those matters for which the law required central control were brought to Washington. T h e continued cen-

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OF T H E

SSA

sequently for the rationalization of the entire Federal field structure. A review of the advantages and disadvantages of all six of the approaches to the rationalization of the Federal field will reveal the timeliness and efficiency of the SSA type of intra-departmental regional organization. E X T R A - D E P A R T M E N T A L APPROACHES TO T H E R A T I O N A L I ZATION

OF T H E

FEDERAL

FIELD

The first type of rationalization of the Federal field structure, as stated, has involved the use of inter-departmental coordinating committees and quite often employed some kind of convener.® The coordinating committee seems an inevitable tralization of administrative, fiscal and other facilitative matters must have resulted in considerable delay, inconvenience to the field staff, and increased travel and communication costs. Third, it might also be noted that the Hoover Commission in dealing with t h e Department of Agriculture limited its field recommendations t o consolidation and coordination on the state, county, and f a r m levels. See Commission on Organization of the Executive Branch of the Government, Department of Agriculture, A Report to Congress ( W a s h i n g t o n : Government P r i n t i n g Office, February, 1949), pp. 13-16. W h i l e the Hoover Commission felt that generally throughout the Federal government there were too many separately organized field offices, it did not suggest the regional level as crucial in the process of consolidation. See Commission on O r g a n ization of the Executive Branch of the Government, General Management of the Executive Branch, A Report to Congress ( W a s h i n g t o n : Government P r i n t i n g Office, February, 1949), pp. 42-45. On the other hand, in dealing with the P o s t Office, the Hoover Commission recommended the establishment of fifteen regional directors of posts t o supervise the district superintendents. See Commission on Organization of the Executive Branch of the Government, The Post Office, A Report to Congress ( W a s h i n g t o n : Government Printing Office, February, 1949), p. 9. See also Robert Heller & Associates, Management Organization and Administration of the Post Office Department, T a s k Force Report on the Post Office, Appendix I, Report of the Commission on Organization of the Executive Branch of the Government ( W a s h i n g t o n : Government Printing Office, February, 1949), pp. 11, 39-40. Moreover, the task force on the Department of Interior proposed a sweeping regionalization of the administration of natural resources within a new Department of N a t u r a l Resources. See infra, n. 8, p. 15. 5 See infra, pp. 272-285. F o r an analysis of the convener idea, see Committee on Public Administration, Social Science Research Council, Memorandum on Regional Coordination (Washington, D. C . : Social Science Research Council, 1943), pp. 11-13, 20-24. (Processed.) See infra, pp. 28-30.

T H E V A L U E OF SSA R E G I O N A L O R G A N I Z A T I O N

15

technique in any large organization in the field as well as at the center. There are usually relations between parts of organizations, regardless of the basis of organization, which only a coordinating committee of some sort can resolve. Moreover, the coordinating committee is a useful and necessary device for the development of overall objectives, for planning, and for the mutual exchange of information. There are, of course, many kinds of Federal field coordinating committees. One type is utilized when some one agency is given responsibility for activity involving the work of other departments. A great deal of the field work of the Office of Defense, Health and Welfare Services (later Community War Services), the Committee for Congested Areas, the War Manpower Commission, and the War Production Board were carried out in this fashion.® A second type of coordinating committee involves joint planning and coordination among Federal agencies with regard to mutual objectives, often with state participation. Two fairly successful examples of this kind of committee were the Columbia River Basin Inter-Agency Committee and the Missouri Basin Inter-Agency Committee, both of which operated under the central Federal Inter-Agency River Basin Committee.7 The question always exists, of course, as to whether such inter-agency committees might not be avoided by better organization at the center.8 6 For examples of the coordinating committee and the convener in interdepartmental activities, see James W. Fesler, " Field Organization," Elements of Public Administration, ed. Fritz Morstein Marx (New Y o r k : Prentice-Hall, 1946), pp. 284-289, and especially pp. 286-287. Cf. also James W. Fesler, Area and Administration (Birmingham: University of Alabama Press, 1949), PP- 86-937 Cf. ibid., pp. 104-113. Henry C. Hart, " Valley Development and Valley Administration in the Missouri Basin," Public Administration Review, V I I I (Winter, 1948), pp. 1-11. 8 Cf. Leslie A. Miller, et al., Organization and Public Policy in the Field of Natural Resources, Task Force Report on Natural Resources, Appendix L, Report of the Commission on Organization of the Executive Branch of the Government (Washington: Government Printing Office, January, 1949), pp. 25-26, 33.

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ORGANIZATION

OF T H E

SSA

A third type of Federal field coordination has revolved merely around planning. T h e regional planning commissions which existed under the National Resources Planning Board, unfortunately abolished in 1943, made their reports through the coordinated assistance of many Federal agencies.* W h i l e field coordinating committees are an inevitable method of coordination in the case of some factors and in some situations, it has been repeatedly pointed out that they have serious limitations and should not be used when better organizational structure at the center and in the field can obviate the necessity for them. Lyndall U r w i c k has given a penetrating analysis of the shortcomings of the committee as a technique of coordination. 1 0 Moreover, intra-departmental rationalization of the Federal field structure will do a w a y with the need for coordinating committees in many situations, and where their use is necessary, will facilitate their work. T h e second of the six main approaches to the rationalization of the Federal field structure, as stated, has involved overall inter-agency coordination in the field carried out by a central staff unit. In the past such attempts have not been successful. Thus, the attempts to procure business economies through the old Federal Coordinating Service of the Bureau of the Budget and its Federal Business Associations w e r e of little value. Moreover, a broad coordination of Federal field activities on program matters never developed and the S e r v ice was abolished in 1933. Similarly, the National Emergency Council failed in its information role, its federal-state liaison activities, its reporting services, and in its coordinating 9 The discussion here is not concerned with coordinating committees or associations which are primarily vertical and involve federal, state and local relations, but with those committees in the field which are horizontal and coordinate primarily the field units of Federal agencies. It must be admitted, however, that various kinds of inter-governmental committees, councils and associations, often have a coordinating effect on Federal field activities. On the other hand, their increase might tend to disintegrate the Federal field unless rationalization of Federal field organization takes place. 10 L. Urwick, loc. cit.

THE

V A L U E OF S S A

REGIONAL ORGANIZATION

17

activities in substantive program matters. It was abolished in 1 9 3 9 . 1 1 In 1 9 4 4 the Bureau of the Budget established a field service which had responsibility in the field for improving interagency relationships, federal, state, and local relationships, and the administrative management of Federal agencies. T h e field service was also to act as the eyes and ears of the Bureau of the Budget in the field, although naturally the members of the various divisions of the Bureau continued to make their own field trips. Most of the work of the field service was for the division of estimates. While the work of the field service of the Bureau of the Budget was more fruitful than that of its predecessors, it was nevertheless limited in staff and funds. It had only four field offices, located in Chicago, S a n Francisco, Denver and Dallas, each of which had only six operating persons except the S a n Francisco office, which had seven. In terms of territory the field service covered no Federal activities east of Ohio or south of the Ohio R i v e r and east of the Mississippi River. It did cover the Great L a k e s States and those west of the Mississippi. It is important for our purposes to note that most of the field service's time w a s spent on promoting better Federal business and administrative management and only a small amount of effort was spent on the substantive program coordination of the Federal field and on the promotion of federal-state and federal-local relations. Within the areas of federal-state and federal-local relations the field service at times acted as convener and mediator when its services were needed, especially for grant-in-aid programs. The field offices attempted to maintain good relations with state administrators and especially with governors. T h e field 11 James W. Fesler, "Executive Management and the Federal Field Service," Problems of Administrative Management, No. IV of Administrative Management in the Government of the United States, ed. President's Committee on Administrative Management (6 nos.: Washington: Government Printing Office, 1937), pp. 27, 41, 44.

l8

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ORGANIZATION

OF

THE

SSA

offices had membership on many inter-governmental committees and were quite active with the Board of Inter-Governmental Relations of the three west coast states. 12 On the whole, however, only about ten per cent of the field service's activities were within the area of federal-state and federallocal relations. 13 In evaluating the field service, it can be said that the service was limited in funds, personnel, geographical coverage, and scope of activity. Its shortcomings, therefore, resulted more from the execution than from the concept of a federal field service for the Bureau of the Budget. It was less effective in matters of substantive coordination of Federal field activities; but as it was organized the field service appeared to be capable of promoting better business and administrative management and better inter-governmental relations. Together with the decentralized Civil Service Commission and the decentralized disbursement division and stores distribution branch of the Treasury, there was the possibility that the field service might be able in the future to bring about more efficient and economical housekeeping and personnel services for the Federal field. The field service also appeared to service capably most of the divisions of the Bureau of the Budget. 14 12 Others are too numerous to mention and included such committees as the Colorado Committee for Resources Development, the Colorado River Basin Committee, and a committee of state budget directors of the Great Lakes States. 13 Most of the data on the Field Service was obtained by interview, but cf. Earl Latham, " Executive Management and the Federal Field Service," Public Administration Revien>, V (Winter, 1945), pp. 16-27. See also Bureau of the Budget, Circular No. A-34, Field Service of the Bureau of the Budget (Washington, D. C.: Bureau of the Budget, September 3, 1946). (Processed.) 14 Writing for the Hoover Commission, A . E. Buck recommended the abolishment of the field service. H e found its work poorly executed, especially that done for the division of estimates. H e felt that the money spent on inter-governmental activities was wasteful considering the many features of Federal budgeting which had not been developed. S e e J. W . Hanes, A. E. Buck, and T. C. Andrews, Fiscal Budgeting and Accounting

THE

VALUE

OF

SSA

REGIONAL

ORGANIZATION

I9

On the whole, however, overall central staff coordination of the field has not been a success, especially in basic program coordination. 1 5 It has been no substitute for the process of the increased rationalization of regional and field structure within departments or agencies. Rather, its effectiveness depends on the full development of that process, or in another sense, on the clarification and orderly organization of the line in connection with which it may carry out a staff function for the President. 1 6 W i t h o u t the rationalization of intraagency field structure, overall Federal program coordination for the field can be carried out only through such techniques as coordinating committees, conveners, meetings, luncheons, the exchange of information and similar ancillary procedures. Moreover, savings and efficiency in housekeeping and administrative management may be better promoted by an overall staff agency if each department has centralized administrative authority on the regional level. The third approach to the rationalization of the Federal field structure has been to propose the establishment of common regional areas and headquarters for decentralized Federal agencies. In this regard the National Resources Committee proposed that the Federal government reduce the variety of Systems of the Federal Government, T a s k Force Report, Appendix F, Report of the Commission on Organization of the Executive Branch of Government ( W a s h i n g t o n : Government Printing Office, January, 1949), pp. 58-59, 61-62. Of course, there must be some overall coordination of the Federal field carried out by a central staff unit. A s intra-departmental rationalization of the Federal field develops, it would perhaps be best to expand the activities of the field service of the Bureau of the Budget, both geographically and with regard to substantive coordination. It has also been suggested that the field service might appropriately serve as the staff to Federal regional conveners. Cf. James W . Fesler, Area and Administration, pp. 92-93. 15 Cf. James W . Fesler, " Field Organization," op. cit., pp. 284-289, and especially pp. 286-287. For a discussion of various intra-departmental types of regional coordination, see infra, pp. 26-35. 16 For a definition of line and staff, see infra, n. 8, p. 42.

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Federal districts in the field and ". . . attempt some grouping or redistricting at least among those Federal organizations concerned with common problems of national development so that they (the districts) reflect the underlying grouping of problems by region," 1 7 and that the Federal government move ". . . in the direction of achieving a limited number of regional centers, say 1 0 to 1 2 . " 1 8 The Committee was not in favor of absolutely fixed regional boundaries, but felt that these might be flexible.19 T h e difficulties with varying regional boundaries and headquarters experienced by Community W a r Services in the wartime coordination of Federal field activities in matters of health, welfare and related fields indicated the value of the Committee's proposals. A s a single approach to the rationalization of the Federal field structure, the proposal for consolidated regions and common regional headquarters has limitations. James W . Fesler showed that administrative regions have been chosen for the advantages of particular administrative agencies and their functions. Although he was of the opinion that increased consolidation was possible and desirable ( a 1943 tabulation revealed 1 4 0 different sets of Federal field service areas), he felt that any attempt to compress all Federal administrative schemes into ten or twelve composite regions would result in such increased costs of administration, delay, and administrative inconvenience as to offset any advantages. But he was of the opinion that the ideal of identical regional office locations could be approximated. 2 0 Perhaps consider17 National Resources Committee, Regional Factors in National (Washington: Government Printing Office, 1937), p. viii.

Planning

18 Ibid., p. xi. 19 Ibid., pp. ix and xi. 20 National Resources Committee, op. cit., pp. 80-82. James W. Fesier, " Field Organization," op. cit., p. 285. James W. Fesler, " Federal Administrative Regions with Special Reference to War Department Procurement Planning Activities" (Ph.D. Dissertation, Dept. of Govt., Harvard University, 1935), pp. 471-474. (Typewritten.) James W. Fesler, "Inter-

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OF S S A

REGIONAL

ORGANIZATION

21

able regional consolidation might take place with regard to regional supervisory districts as distinguished from districts created for operating purposes. T h e important thing to note about the proposals for consolidated regions and identical regional headquarters for the Federal field as a whole is that the process, regardless of its limitations, can best be advanced by the rationalization of intra-departmental regional organization. T h e establishment of consolidated intra-agency regions, regional headquarters and regional command would appear to be a prior or at least a simultaneous process. T h e fourth main approach to the rationalization of the Federal field structure has emphasized the importance of regional planning commissions subject to a national planning commission and integrated with state and local planning groups. The purpose has been to affect the policy and programs of Federal agencies through the kind of regional planning which would reflect the needs of regional culture, economy, natural resources, agriculture, social conditions, cooperative regional undertakings, and other similar factors. The program as proposed by the National Resources Committee required relatively fixed but flexible Federal administrative regions and identity of regional headquarters. T h e purpose was not merely to provide for the coordination of federal field activities but also to promote through planning the concept of regionalism as proposed by H o w a r d W . Odum and H a r r y E . Moore, the National Resources Committee, and other regionalists. 2 1 Since the proposal for regional planning has included the proposal of consolidated but flexible Federal regions and departmental Relations in the Federal Field Services," Washington-Field Relationships in the Federal Field Seri'iec (Washington, D. C . : Graduate School, U. S. Department of Agriculture, 1942), p. 52. J a m e s W . Fesler, Area and Administration, p. 7. 21 National Resources Committee, op. cit., pp. viii, 1-9. H o w a r d W . Odum and H a r r y E . Moore, American Regionalism ( N e w Y o r k : Henry Holt & Co., 1938), passim and especially pp. 3 - 5 1 , 270-274, 462-641.

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identical regional headquarters, it is subject to the same limitations as the latter plan and is also dependent on an increased intra-departmental rationalization of the field. Moreover, regional planning as presented would require the acceptance of the theory of regionalism, 22 which involves many concepts of a highly controversial nature. Regional planning would also require the formation of policy on the regional level rather than the predominantly current practice of policy decision at the center. It would seem, therefore, that much work would have to be done to clarify the relations of national, regional, state and local planning commissions to the normal lines of administrative authority; otherwise, the net effect on Federal administrative authority projected into the field might be extremely confusing. 2 3 The fifth approach to the rationalization of the Federal field structure has involved the use of regional development authorities such as the T V A . T h e technique as exemplified in the T V A has proved a valuable means of on-the-spot integration of Federal activities in regard to water, land, minerals and forests. Usually, Federal work with regard to these national resources has been carried out by various Federal agencies operating out of Washington such as the A r m y Corps of Engineers, the bureau of reclamation, the Federal Power Commission, the Department of Agriculture, the Public Health Service, the fish and wildlife service, the geological survey, the bureau of mines, the bureau of land management, the soil conservation service, and the national park service. The regional development authority, therefore, is a technique of solving the clash of organization by subject (function or purpose) and organization by area, even if it raises other 22 Ibid. 23 As to the proposal, cf. National Resources Committee, op. cit., pp. x-xi, 182-196. H o w a r d W . Odum & H a r r y E . Moore, op. cit., pp. 270-274. James W . Fesler, " Field Organization," op. cit., p. 289. F o r additional objections to those noted above, see James Fesler, Area and Administration, p. 34.

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REGIONAL

ORGANIZATION

23

problems. 24 T V A , of course, went further and brought the field establishments of other Federal agencies into cooperative planning and administration in the development of its valley region, promoting the process by its own independent financing. 25 The limitations of the regional development authority as a means of rationalizing the Federal field structure are also rather formidable. First, as a technique the regional development authority is confined, as to the core of its work, to the unified development of natural resources, such as water, land, minerals, and forests. 2 6 Second, the role of the Washington bureaus dealing with natural resources would have to be decided if there are going to be more and more regional development authorities. Third, if all regional development authorities take a promotional role toward their regions as the T V A has done, there would have to be a re-definition of the field authority relationships of many Federal agencies carrying on regulatory, service, or aid activities. A t least in the beginning, therefore, more T V A s might introduce more confusion into the Federal field structure since they would involve a completely revolutionary approach to regional organization. 2 7 Fourth, if regional development authorities increase, questions of geographical jurisdiction and problems 24 James W . Fesler, " Field Organization," op. ext., p. 289. Much of the necessity for T V A results from incorrect organization at the center. 25 David E. Lilienthal, TVA, Democracy on the March Harper & Bros., 1944), pp. 12, 37, 108, 133, 162, 165.

(New

York:

26 Ibid., p. 155. 27 C. Herman Pritchett felt that the T V A should be retained, but that the regional development authority as an administrative device should not be multiplied. H e was of the opinion that more T V A s would create very difficult problems of coordination with the regular departments of the Federal government. Of T V A programs he said, " . . . it has required hard work and consistent effort to mesh these regional programs with the national efforts of other federal agencies." C. Herman Pritchett, The Tennessee Valley Authority (Chapel H i l l : The University of North Carolina Press, 1943), PP- 138-139-

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OF T H E

SSA

of inter-regional adjustment of water manipulation and use, and of economies would develop. T V A is partly an experiment in Federal equalization, that is, in raising the economic and social level of a region with undeveloped resources, but the addition of regional development authorities may result in the necessity of resolving the ambitions of regional economies, of deciding geographical area for the marketing of products, and of maintaining equilibrium in the national economy. More regional development authorities would certainly require the supervision of a national department in W a s h i n g t o n . Sixth and last, an increase of regional development authorities would require new methods of establishing their responsibility t o Washington departments. 2 8 In conclusion, in view of the dangers noted, it may be best to explore some other method of coordinating Federal administrative action dealing with resources. Perhaps it would be better to group in one department or super department on the national level all of the Federal bureaus dealing with land, water, minerals, and forests, and to provide for intra-departmental regional organization of the various constituents of this department under single regional directors. 2 8 There 28 Generally on the question of more TVA's, see William Pincus, " Shall W e Have More T V A ' s , " Public Administration Rei'iew, V (Spring, 1945), pp. 148-152. Cf. Leslie A. Miller, et al., op. cit., pp. 30-31. 29 This was essentially the proposal of the task force on natural resources of the Commission on Organization of the Executive Branch of the Government, which recommended that all activities dealing with public domain, water development, soils, forest, range, recreation, fish, wildlife, power marketing and mineral resources, be grouped into a new Department of Natural Resources and that all activities dealing with water, forests, and ranges be decentralized regionally. See Leslie A. Miller, et al., op. cit., passim, but especially pp. 6-9, 22-32, 47-49, 52-53, 59-61. Three commissioners took practically the same point of view as the task force, except that if the envisaged Department of Natural Resources should not be achieved, they favored additional river development authorities. See Commission on Organization of the Executive Branch of the Government, " Department of Natural Resources, Separate Report of Vice Chairman Acheson, Commissioners Pollock and Rowe," Reorganization of the Department of Interior, A Report to Congress (Washington: Government Printing Office, March, 1949), pp. 53-80 and especially pp. 68-71.

THE

V A L U E OF S S A

REGIONAL

ORGANIZATION

25

should be considerable decentralization of authority to such regional organizations. A m o n g other things such an arrangement would provide for a more orderly organization of the Federal field structure. A t any rate whether regional development authorities increase separately or within a single department, two implications are clear for the rationalization of the Federal field structure. First, as a technique, regional development authorities are suited mainly to the development of resources, and their increase cannot solve the total need f o r the rationalization of the Federal field structure. Second, their increase will introduce new interests, drives and complications which will affect and tend to disintegrate the field structure of other Federal agencies, further emphasizing the need for intra-departmental regional organization. T h e burden of the argument up to this point indicates that the sixth approach to the ordering of the Federal regional structure, that which is concerned with the rationalization of intra-departmental regional organization, is the most fruitful one to pursue at present, since other methods either have Within the Department of Interior two regional committees, the Missouri Basin Field Committee and the Pacific Northwest Coordination Committee, have been coordinating all of the Department's activities within their respective regions. The two regional committees have operated under centra! committees and generally speaking, have attempted to coordinate plans, programs, budgets and development projects. See Pacific Northwest Coordination Committee, Report on Regionalization of the Department of Interior in Region I, The Pacific N or t Incest (Portland, Oregon : U. S. Department of Interior, February 13, 1947). (Mimeographed.) See also Pacific Northwest Coordination Committee, Report on Coordination in the Department of Interior in Region I, The Pacific Northivest (Portland, Oregon: U. S . Department of Interior, March, 1947). (Mimeographed.) See also Pacific Northwest Coordination Committee, Annua! Report (Portland, Oregon : U . S . Department of Interior, January 7, 1948). (Duplicated.) See also Henry C. Hart, op. cit., pp. 4-5. For the most part (but with growing authority of their own) the two regional committees have operated on the convenercoordinating committee formula. See infra, pp. 28-30. See also Dean Snyder, Elton Woolpert, and H a r r y Holland, Methods and Approaches for Improving Field Coordination within the Federal Security Agency (Washington, D. C.: Federal Security Agency, May, 1947), app.r exhibit E , pp. 5-9. (Processed.)

26

REGIONAL ORGANIZATION

OF T H E

SSA

serious limitations or depend in part on intra-departmental regional organization. This is not to say that extra-departmental coordination can be ignored, but rather that the matter is one of emphasis. Indeed, the use of inter-departmental coordinating committees and conveners seems inevitable, while the development of the work of the field service of the Bureau of the Budget appears desirable, especially with regard to program matters. There should also be increased pressure for the adoption of identical headquarters cities by Federal agencies wherever possible. But as a matter of timing, the immediate need is for the rationalization of intra-departmental regional organization. A review of the various types of intra-departmental regional organization will indicate that the multiple type is superior. TYPES OF INTRA-DEPARTMENTAL

REGIONAL ORGANIZATION

30

In some cases it has been customary for Federal departments, bureaus or offices to handle field work by travel out of Washington. The Office of Education has consistently followed this procedure, and it used to be the arrangement employed by the children's bureau. In such instances it is usual to have men located in Washington traveling to service certain assigned regional areas. In minor respects this device does have some of the advantages of specialization of contact with states or other clientele or with objects of administration on a continuous basis. On the whole, however, the handling of field matters out of W a s h i n g t o n is unsatisfactory. It involves heavy cost through travel and loss of time, makes Federal agents inaccessible to cooperating states, embarrasses operating coordination with other Federal agencies which are decentralized, fails to reduce congestion at the center, is not conducive to the representation of the local point of view, is 30 Of course, a department may attempt to eliminate the regional level altogether in its field structure. See the description of the field organization of the Veterans Administration in n. 4, supra.

THE

V A L U E O F SSA R E G I O N A L O R G A N I Z A T I O N

27

almost impossible where quick action is necessary in the field ( a s is often the case in inspectorial and regulatory activities) and is impossible where the job is one of dealing with resources. A second type of regional arrangement has allowed the establishment of independent field and regional units by each bureau in an agency and even by individual divisions within a bureau. Macmahon and Millett demonstrated the evils of this type of decentralized organization in the case of the early days of the Resettlement Administration. They showed how it was abandoned for the organization of the various phases of the regional work of the Resettlement Administration under a single regional director, in short, for multiple decentralization. 3 1 There have been other demonstrations in the literature of the costliness and inefficiency of the independent decentralization of an organization's m a j o r activities. John Millett showed that each of the bureaus of the Department of Interior had its own set of field offices; that although the W a r Department had nine corps areas in the United States, the supply a r m s and services kept their own independent procurement offices; and that in New York City the W a r Department has six independent procurement planning offices. 32 William D. Carey noted the confusion, competition, and disorganization caused by the independent decentralization of divisions in the early days of the Office of Production Management and the W a r Production Board and how this type 31 Arthur W. Macmahon, John D. Millett and Gladys Ogden, The Administration of Federal Work Relief (Chicago: Public Administration Service, 1941), pp. 261-264. 32John D. Millett, "Field Organization and Staff Supervision," New Horizons in Public Administration (Birmingham: University of Alabama Press, 1945)1 PP- 97-102. These examples are, of course, from past organizational arrangements. In 1949 the Hoover Commission felt that there were " too many separately organized . . . field offices representing individual departments, their bureaus, and even different units of one bureau." See Commission on Organization of the Executive Branch of the Government, General Management of the Executive Branch, p. 42.

28

REGIONAL

ORGANIZATION

OF T H E

SSA

of organization was supplanted by multiple regional organization. 3 3 O n the whole, regional organization by individual activities of an organization is unsatisfactory, for the following reasons: it fails to provide for economy by the use of joint housekeeping facilities; it does not coordinate activities in their impact on clientele or objects of administration; it makes difficult the overall control of public relations; it either fails to provide technical services of an auxiliary nature or requires their duplication for each activity at considerable cost; and it provides no basis for the rationalization of the Federal field structure through intra-departmental regional consolidation and coordination. A third type of regional structure is the same as the second except that it provides a regional business officer or administrative assistant who renders business and housekeeping services for the separate regional representatives. T h i s was the kind of practice followed as a second step in the early days of the Resettlement Administration and the Office of P r o duction Management. It was a failure in both instances so far as producing economies was concerned. 34 J o h n D. Millett has pointed out that unless there is an overall administrator on the spot, the business manager can be, and usually is, ignored with impunity. 3 6 A fourth type of regional organization involves the use of a regional convener and a coordinating committee. 3 0 W i t h i n an agency this technique is a rudimentary attempt to provide coordination between separate bureaus or divisions. It arises because authority relations at the center are not clear, or because the constituent bureaus or divisions of an organization 33 William D. Carey, " Central-Field Relationships in the W a r Production Board," Public Administration Review, IV (Winter, 1944), pp. 31-34. 34 Ibid., pp. 33-34. Arthur W . Macmahon, et al., op. cit., p. 263. 35 John D. Millett, op. cit., pp. 101-103. 36 Cf. Committee on Public Administration, Council, op. cit., pp. 11-13, 20-24. (Processed.)

Social

Science

Research

THE

VALUE

O F SSA

REGIONAL ORGANIZATION

29

appear to be unrelated or extremely complex or insist on independence in the field. The convener-coordinating committee technique has also been used (and more appropriately) when one agency has been given duties which require the coordination of the field activities of other agencies. 37 There are, of course, many variations of the convener-coordinating committee technique. T h e process employed is one of holding meetings and of extracting commitments and policing them. Quite often the convener and his committee w o r k under a comparable convener and committee at the center, who also plan and coordinate and give pre- or postdetermination of the authority and realm of action of the regional group. Besides basic matters of program, the regional convener and coordinating committee may be used for lesser functions, such as gathering information for action by central command, providing for the pooling and interchange of housekeeping and business services, promoting or advising in regard to studies, etc. 38 T h e duties and authority of the convener may vary, depending on the situation. H e may be merely a chairman chosen by the committee itself, or he may be an officer appointed by the central authority. H e may be given the authority to make limited decisions and to be the channel of all communication, or his powers may be limited to planning, running a secretariat, convening meetings, and reminding cooperating organizations of their commitments. W h e r e an agency of government is given responsibility for programs requiring the cooperative action of other agencies, as was the case of Community W a r Services, the Committee for Congested Areas and the W a r Manpower Commission, the regional convener and the coordinating committee seem 37 See supra, pp. 14-15. 38 For examples of the convener-coordinating committee type of intradepartmental regional arrangement in the Department of Labor, the Federal Works Agency and the National Housing Agency, see Dean Snyder, et al., op. cit., app., exhibit E, pp. 6-12.

30

REGIONAL

ORGANIZATION

OF T H E

SSA

an inevitable technique although it would appear desirable for the convener, even in this situation, to have some direct administrative authority, such as the power to give, to intervene, or to veto. 39 There seems to be no valid reason for the employment of the convener-coordinating committee technique intra-departmentally. A s will be seen, S S A experience indicates that an integrated regional organization under the general authority of a regional director is possible even when it involves only moderately related bureaus and programs. 4 0 It is merely a question of defining the authority of the regional director in a limited fashion appropriate to the situation. Moreover, where there are enough operating relations between decentralized bureaus or divisions to employ a regional convener and coordinating committee, there is sufficient area of activity to justify the establishment of a regional director with general administrative command. A t any rate, intra-departmentally the regional convenercoordinating committee technique has the following limitations: it does not provide for business and housekeeping savings, for it does not establish such regional administrative authority as to secure these savings; it is slow, costly, and time consuming, and must depend largely on persuasion for coordinated action; it is seldom strong enough to check the rivarly of specialty; it does not provide for the joint use of technical or auxiliary services; it does not necessarily require identical headquarters or consolidated regional areas; and it does not provide a solid basis for inter-agency coordination. T h e fifth type of intra-departmental regional organization provides for a multiple regional structure. Under multiple regional organization all or most of the regional representatives of an agency are organized under the general administrative authority of a regional director at common regional headquarters. Individual bureaus or divisions, as the case 39 See infra, pp. 274, 280-281. 40 This does not mean that totally unrelated activities may be grouped under general regional command. See infra, pp. 32-34.

THE

V A L U E O F SSA R E G I O N A L O R G A N I Z A T I O N

3I

m a y be, continue to have technical supervision of their regional representatives. Macmahon and Millett pointed out the advantages of this kind of organization with regard to the W o r k s P r o g r e s s Administration and the Resettlement Administration, and indicated its feasibility through the development of the doctrine of dual supervision. They noted that contrary to accepted theories of line and staff or field supervision, direction of a field project cannot be unitary. In addition to the administrative line of command there is the technical line. 41 After Macmahon and Millett published, the experiences of the Forest Service, the Office of Price A d ministration and the W a r Production Board with multiple field organization and duality of command were described in the literature. 4 2 T h e advantages of intra-departmental multiple regional organization are as follows: it provides for joint housing and administrative services and establishes the kind of regional administrative authority which can enforce savings with regard to these; it reduces travel costs and serves customer convenience through the establishment of identical regional headquarters; it provides through the general regional commander for the regional coordination and control of some or most of the departmental constituents operating in the field and thus prevents rivalry and conflict; it establishes a basis for the devolution of authority and a place where the regional point of view may be presented and considered; and above 41 A r t h u r W . Macmahon, et al., op. cit., pp. 244-268. Cf. W . F. Willoughby, Principles of Public Administration (Washington, D. C . : T h e Brookings Institution, 1927), pp. 155-159. 42 E a r l W . Loveridge and Peter Keplinger, " Washington-Field Relationships in the Forest Service," Washington-Field Relationships in the Federal Senice (Washington, D. C.: Graduate School, U. S. Department of Agriculture, 1942), pp. 24-25. William D. Carey, op. cit. Emmette S. Redford, Field Administration of Wartime Rationing ( W a s h i n g t o n : Government P r i n t i n g Office, 1947), pp. 44-50. F o r the same type of organization on the next level, that is, within a region, see G. M. Goodrich, " W P B Decentralization within the Chicago Region," Public Administration Reziew, I V (Summer, 1944).

32

REGIONAL

ORGANIZATION

OF

THE

SSA

all, it makes feasible overall attempts at Federal field coordination, consolidation and control by rationalizing the intradepartmental field structure. THE

SSA

TYPE

OF

INTRA-DEPARTMEXTAL

REGIONAL

MULTIPLE

ORGANIZATION

A s early as 1936 the Social Security B o a r d established a consolidated regional structure under the general administrative authority of a regional director. T h e

Board's

with the exception of the bureau of business were

represented

representatives,

on

the

regional

w h o were under

level

by

bureaus,

management, their

the technical

regional

direction

of

their bureaus in W a s h i n g t o n and the administrative direction of the regional director. T h e Board continued with this kind of multiple regional organization which w a s also followed by its successor, the S S A . In one important sense, however, the S S A regional organization represented an additional development in multiple regional organization because it w a s responsible for carrying out four basic programs. In this w a y

it

differed, for example, from the regional organization of the W o r k s Progress Administration or the F o r e s t Service where the program units on the regional level

(as well as at the

center) resulted from the division of one basic task. T h e S S A type of multiple regional organization

might

be called

ap-

propriately multi-program regional organization under general regional command. Multi-program organization

of

regional many

organization

different

makes

departmental

possible

the

programs

on

the regional level under general regional command. F o r this reason it is significant for the rationalization of the regional organization of Federal departments and consequently for the rationalization

of the whole Federal

field

structure.

Multi-

program regional organization may be accomplished in any given department by organizing under general regional command on the regional level those departmental

constituents

which have significant field relations T h e frame of reference

THE

VALUE

OF

SSA R E G I O N A L

ORGANIZATION

33

for the authority of the general regional commander is developed in terms of these field relations and in terms of desirable overall departmental objectives. The authority of the regional commander is general and limited, not unitary and inclusive. Useful and valuable kinds of general regional command may be developed even when the field program relations of departmental constituents appear meager. This fact is important with regard to the utility of multi-program regional organization, for many departments of the Federal government were formed by grouping organizations which were generally concerned with some broad subject, or which had planning relations at the center, but few operating program relations in the field as far as substantive program matters were concerned. F o r example, while the four organic tasks of the S S A had general planning relations which justified their organization together at the center, they had few operating relations in the field, except that all but one were federal-state programs and involved the same clients, and similar techniques of administration. Yet out of these field relationships, which were not program relationships, plus certain overall organizational objectives, the S S A maintained multi-program regional organization under regional directors, whose command was of great utility. Thus, it might be stated that where departmental constituents deal with the same clientele or objects of administration, or the same area, or employ the same specialties, or have identical relations with other Federal organizations, etc., the possibility of multi-program regional organization under general regional command is present. Of course, some constituents of a department may have no significant field relationships and these may well go their separate ways in the field except for common housing and administrative services where appropriate. It should be noted that it does not follow that wherever a frame of reference for general regional command can be con-

34

REGIONAL

ORGANIZATION

OF T H E

SSA

cocted, multi-program regional organization is justified. F o r example, it would hardly be correct to take any one activity within a department or within the Federal government as a whole and make it the general line of command in an area, for the result would be the perversion of other activities to its ends and their consequent suspicion and hostility. N o r would the concept of general regional command justify the establishment of omnibus or composite regions of the United States under a regional director commanding in terms of a " regionalist " frame of reference and guided by a regional planning commission. Such a scheme is undesirable for many reasons. The regional command of such a regional director would be ancillary to administrative lines of responsibility and would violate present political arrangements for determining policy and for locating political responsibility. Moreover, as has been stated, omnibus regional organization faces the fact that it is impossible to organize all federal activities into the same regions without producing costly administrative inconvenience for many activities. CONCLUSION

In conclusion, it can be stated that of all the approaches to the rationalization of the Federal field structure which have been proposed or attempted, those which have been concerned with the consolidation of regional organization within the department are the most fruitful for the present. T h i s is true in part because of the defects and limitations of some of the extra-departmental approaches. Extra-departmental attempts at coordinating the Federal field which appear desirable include only the use of coordinating committees and conveners, the advancement of the work of the field service of the Bureau of the Budget, especially with regard to program matters, and the establishment of the use of identical regional headquarters cities by Federal agencies wherever this is feasible. H o w ever, intra-departmental approaches to the rationalization of the Federal field are most fruitful for the present, mainly be-

THE

V A L U E OF SSA R E G I O N A L O R G A N I Z A T I O N

35

cause extra-departmental approaches are, to a large degree, dependent upon the advancement of the process of structuralizing regional organization within the department. Of the various kinds of intra-departmental regional organization, multiple regional organization is the most advantageous. T h e S S A type of multiple regional organization, or multi-program regional organization, is especially important for the rationalization of regional organization within the department because it makes possible the regional organization of relatively different departmental programs under general administrative line authority. This characteristic is significant, for many Federal departments or agencies are composed of programs which, though generally related in terms of some broad subject, differ as to program content and have few operating relations. If they have any important field relations, however, they may be organized together through multiple regional organization under general regional command.

CHAPTER II SSA REGIONAL ORGANIZATION: ITS NATURE, ADVANTAGES AND TECHNICAL PROBLEMS BEFORE discussing the background and the separate technical aspects of S S A

regional organization, it will be helpful

to consider it as a whole and in terms of the m a j o r concepts involved. T h e aim in this chapter, then, is to analyze nature of S S A

the

regional organization, to note the purposes

which it served, and to outline the m a j o r concepts and technical

problems

involved.

The

discussion

of

SSA

regional

organization as a whole will also provide an example of h o w multi-program

regional organization m a y be utilized to ra-

tionalize intra-departmental SSA

A

ORGANIZATION

AT

field

THE

organization.

CENTER

A N D IN

short description of the Social Security

THE

REGION

Administration

will make clear the nature of its regional organization and enable a statement organizational

of

its advantages

problems

examined

and of the

in this volume.

technical As

the

S S A w a s organized in the fiscal year 1946-47, the main responsibilities under the C o m m i s s i o n e r of Social Security for its four basic p r o g r a m s were allotted to four bureaus called " operating"

bureaus

in S S A

terminology,

reasons to be noted later, m i g h t

have

but which,

been more

for

suitably

termed p r o g r a m bureaus. T h e allocation of responsibilities to these four " operating " or p r o g r a m bureaus w a s as f o l l o w s : 1. T h e bureau of public assistance was responsible for the administration of grants-in-aid to states for the partial payment of both the state administrative costs and the state grants of assistance to dependent children, the dependent blind and the needy aged. A s in the case of other federalstate program bureaus (the bureau of employment security and the children's bureau), the bureau of public assistance 36

SSA R E G I O N A L

ORGANIZATION:

ITS

NATURE

37

was concerned with such matters as plans, required standards, budgets, grants and state administrative efficiency. 2. The bureau of employment security was responsible for the administration of grants to the states for the payment of the total expense of administering state unemployment compensation laws, 1 and for the certification to the Commissioner of Social Security of the conformity of these laws and their administration with Federal requirements under the Social Security Act as amended. Such conformity was required in order for states to receive their administrative expenses and to recapture 90% of the federal unemployment compensation taxes for state unemployment compensation systems. 3. The children's bureau administered grants to states for strengthening services in predominantly rural areas for homeless, dependent, neglected and near delinquent children. It also administered grants to states for maternal and child health and for crippled children's programs both in predominantly rural areas and in areas suffering from economic distress. In addition, the bureau had certain informational and research functions, carried out on a purely federal basis. 4. The bureau of old age and survivors insurance administered a federal insurance for covered workers (mainly industrial) and their survivors. The program was operated federally, and the bureau maintained field offices for direct contact with workers and employers whose taxes paid most of the cost of the insurance. I n addition to the four " operating " or p r o g r a m bureaus the S S A was organized into five functional bureaus called " services." These " services " really were functional divisions of the " operating " or program bureaus. T h e y were created by gathering up the common specialties of the p r o g r a m bureaus and organizing them into separate bureaus. Moreover, 1 In appropriating for 1948-49 Congress returned the employment service to the bureau of employment security. On August 19, 1949, the bureau of employment security was transferred under Reorganization Plan I I of 1949 to the Department of Labor.

38

REGIONAL

ORGANIZATION

OF T H E

SSA

while apparently facilitative or auxiliary, these " services" were actually operating in the case of the federal-state programs, having direct supervisory responsibilities over the states in regard to certain requirements. They were auxiliary in nature as far as their i n t r a - S S A activities were concerned, that is, for either the S S A as a whole or for individual bureaus. A brief review of the duties of the " services" will reveal their nature. 1. The bureau of accounts and audits was responsible for the audit of state accounts in the case of unemployment compensation and public assistance. The audits checked not only the adequacy of the accounting in fiscal systems, but also the federally required business and administrative standards. The bureau also established accounting systems for state public assistance and unemployment compensation agencies. It did no state work for the children's bureau which had its own audit unit for these purposes. Internally, for the entire SSA the bureau of accounts and audits provided accounting and administrative audit services which were auxiliary in nature. 2. The main activities of the informational service 2 were auxiliary and were concerned with the carrying on of public relations for the SSA as a whole and its bureaus, especially the bureau of old age and survivors insurance. But the informational service also gave advice and assistance to state agencies in their public relations programs, and in this regard it was an operating bureau. 3. The state technical advisory service 3 was responsible for the enforcement of the merit system personnel requirements of the states in the case of the public assistances and unemployment compensations. But here again the children's bureau had its own unit. 2 Abolished through congressional appropriation action, 1947-48. 3 This was the only " service " without independent status and was located in the Office of the Commissioner of Social Security.

SSA R E G I O N A L O R G A N I Z A T I O N :

ITS N A T U R E

39

4. The office of the general counsel, which was organized on the Agency level at the center, was responsible in the case of the federal-state activities for the determination of the legality of state legislative, executive, judicial and administrative acts in terms of the requirements of the Social Security Act as amended. Of course, the general counsel served a similar function for some other grant activities of the Federal Security Agency, and rendered the normal auxiliary legal services for the Agency and its constituents. 5. The bureau of research and statistics was responsible for basic research and planning, largely with regard to new programs and the expansion of old ones. It was also responsible for overall statistics and for the coordination of research. In 1946-47 it was the only " service " without regional activities. 4 In addition to the bureaus described, the other main components of the S S A were the Office of the Commissioner, the appeals council which was responsible for the hearing of the appeals of claimants for old age and survivors insurance benefits, and the office of the actuary which made long range actuarial estimates for the old age and survivors insurance program. T h e regional structure of the S S A represented in miniature most of its central organization. In continental United States the S S A maintained eleven identical regional areas with eleven identical headquarters for all of its decentralized bureaus. Except for the bureau of research and statistics, each of the bureaus of the S S A and the office of the general counsel were represented in each regional office by a regional representative and assistants. These representatives were technically responsible to their bureaus in W a s h i n g t o n and administratively responsible to the head of the regional office, the regional director, who in turn was responsible to the 4 In the early days of the Social Security Board, the bureau of research and statistics was responsible for the administration of the statistical requirements made of the states in the federal-state programs and for research in the operating problems of state agencies.

40

REGIONAL

ORGANIZATION

OF

THE

SSA

5

Commissioner of Social Security. The regional representative of the bureau of old age and survivors insurance was responsible for the supervision of his bureau's field offices which were located below the regional level in industrial and urban areas; the other regional representatives, both of " o p erating " and " service " bureaus, carried on work with state agencies in regard to federal-state programs. In addition, the " service " representatives, with the exception of the regional personnel consultant,® provided auxiliary activities for the regional office as a whole and especially for the directly operating bureau of old age and survivors insurance. T H E N A T U R E OF S S A R E G I O N A L O R G A N I Z A T I O N

It can be seen from the above description that the SSA type of regional organization was a form of multiple field organization. As already noted, it might appropriately be called multi-program regional organization under general regional command since the " operating " or program bureaus and their regional representatives carried out organic and distinct jobs. In this way the regional organization of the SSA differed from those multiple regional organizations where the program bureaus resulted from the functionalization of one job. The distinction between the two types of multiple field organization is important in any analysis, for the general command of the regional director will usually be more general, more limited as to detail and more precisely defined in the case of the multi-program organization. 7 It may also be noted from the above description that the programs of the S S A had few relations on the regional level as far as the content of their work was concerned. Of course, 5 In most regional offices there was a regional referee who was the representative of the appeals council, but the regional director had no relations with him except to provide his housing. 6 Title of the regional representative of the state technical advisory service. 7 It should be noted that in simple multiple field organization general command may be complicated when functional divisions represent specialties with varying professional backgrounds.

SSA

REGIONAL

ORGANIZATION:

ITS

NATURE

41

with the exception of old age and survivors insurance, they were all federal-state programs and dealt with the same clientele—the states. T h e y consequently employed many of the same techniques and specialties. Besides the organization of different and relatively unlike programs under general regional command, the regional organization of the S S A

(in fact, its whole organization) had

one other significant characteristic. Both at the center and on the regional

level the common

specialties

of

the

bureaus were organized into the functional bureaus "services")

of

accounts

and

audits,

general

Washington organized on the A g e n c y level),

program (called

counsel

(in

informational

service and state technical advisory service. These

bureaus

were functional divisions of the program bureaus and were organized on the basis of subjects. ( T h e program bureaus also were organized on the basis of subjects). Although concerned with the specialties usually associated with auxiliary services, the functional bureaus were indeed operating units as f a r as federal-state matters were concerned. All of them, except the state technical advisory service, also carried on the usual internal auxiliary activities for the S S A as a whole and for the program bureaus, especially the bureau of old age and survivors insurance. 8 8 P e r h a p s it will be helpful at this point to define terms which will be used repeatedly. In the field of administration the term functional can be used in at least two basic w a y s . T h e w a y indicate a basic division of

work.

functions, and

these divisions

w e speak

of

it is used in this book is to

T h u s , an undertaking as

is divided

into

functional divisions.

The

process of division may be called functionalization. In this sense the line t h r o w s off functions horizontally

as opposed to its division vertically

in

hierarchical groupings. Cf. J . D . Mooney and A . C. R e i l l y , Onward

Industry

( N e w Y o r k : H a r p e r & B r o s . , 1 9 3 9 ) , p. 25. Cf. also L . U r w i c k , The

Elements

of Administration

( N e w Y o r k : H a r p e r & B r o s . , 1 9 4 3 ) , pp. 47-48, 56, 60-61.

Generally, functional units m a y be of two k i n d s : those which are a u x i l i a r y , such as those concerned with budgeting, legal, personnel, accounting

and

auditing activities, and those which a r e operating. T h e latter are exempli-

42

REGIONAL

ORGANIZATION

T H E A D V A N T A G E S OF T H E S S A

OF

THE

REGIONAL

SSA

ORGANIZATION

T h e S S A regional organization, which may be described as multi-program, functionalized regional organization under general regional command, had at least seven major advantages, some of which were common to any multiple field organization. First, it made possible savings in housekeeping and business services not only because of the housing of all regional representatives in a single regional office, but also because the general administrative authority of the regional director made possible the enforcement of economies. Second, the organization of common specialties on the basis of subject into the functional bureaus made possible the economical decentralization of specialties. T h e cost of S S A regional organization would have been prohibitive if, for example, all auditors had been required to travel out of Washington or if fied by the divisions of timber management, range management, wild life management and fire control of the Forest Service. T h e term specialty (specialize, specialization) is often used in this book. Specialty is a colored word but usually refers to a recognized field for concentration in training and work. It is used in this sense in this volume. T h e terms line and staff have also been employed in this volume. In the concept line and staff, line is composed of those persons responsible for carrying out the undertaking, in short, the chain of command. In another sense, line can be thought of as the total job. T h e total job organizes itself for action by functionalizing, and the residual, main and responsible core is the line. Line has the main responsibility for doing the job and staff is composed of those persons aiding and assisting the line in its responsibilities. T h i s aid and assistance may be construed in a broad or narrow sense. T h e word staff may be used in the broad sense to mean: ( i ) auxiliary activities; (2) central administrative services such as procurement, supplies, messenger services and other housekeeping activities; (3) any operating functional division of the line; and (4) those persons who as an extension of the personality of commanders on any level aid and assist line officers in planning, organizing, coordinating, commanding and controlling. Staff in this volume is used only in this last sense to refer to those who assist the commander in the execution of his command duties, who do only this and w h o in no ways add to his burden of command or coordination. See L . U r w i c k , " Organization as a Technical Problem," Papers on the Science of Administration, eds. L . Gulick and L . U r w i c k ( N e w Y o r k : Institute of Public Administration, 1937), p. 62. See infra, pp. 131-136.

SSA

REGIONAL

ORGANIZATION:

ITS N A T U R E

43

each of the four p r o g r a m bureaus had been under the obligation to supply its o w n auditors on the regional or state level. O f course, the efficiency of the specialties w a s improved by their organization on the basis of subject into separate bureaus. P e r h a p s the most important benefit resulting from the organization of the functional bureaus w a s the standardization of the many requirements made of the states regardless of prog r a m . T h u s , S S A merit system standards were the same for unemployment compensation and public assistance. T o g i v e an example of just the opposite situation, in 1946-47 w h e n the children's bureau had its o w n accounts and audit unit, a state department of welfare might have faced different fiscal requirements for its public assistance and its child welfare programs. Third,

the

SSA

regional organization

made available

a

super-negotiator f o r federal-state programs in the person of the regional director. H e w a s usually a person of considerable prestige and influence, and through negotiations with

gov-

ernors and state legislators, he w a s often able to settle problems which could not be handled by the regional representatives dealing with state agencies. Fourth, regional

through

the regional director

organization

the S S A

type

afforded centralized control of

relations in the region.

F o r example, through the

of

public

regional

director it w a s possible to make sure that when a bureau's regional representative spoke publicly, he reflected the point of view of the S S A ,

not his o w n attitude nor that of

his

bureau. It w a s also possible to prevent public quarrels between bureaus.

Moreover,

assisted

by

the

regional

information

specialist, the regional director himself represented the before the public. T h r o u g h

SSA

public and private contacts the

regional director carried on a personal and persuasive public relations program. F i f t h , the general command of the regional director w a s the focus

for

the

coordination

of

operating

relations

between

S S A p r o g r a m bureaus and between these bureaus and outside Federal organizations. O f course, it is true that operating re-

44

REGIONAL

ORGANIZATION

OF

THE

SSA

lations between the program bureaus of the S S A were meager, but they continued to grow as new organizations were added to the S S A . Moreover, as the regional director of Community W a r Services, the S S A regional director was the focus of coordination not only between his own constituents and outside programs but for all Federal programs in health, welfare, recreation, and related fields. Sixth, it should be noted that general regional command in any multiple regional organization provides a means of controlling the rivalry and conflict of constituent units on the regional level. W h e r e programs in any w a y compete, regardless of whether they represent several different tasks or arise from the functionalization of one undertaking, general regional command may prevent destructive internecine warfare. Moreover, functionalized portions of a task, whether they serve a program (line) or facilitative purpose, may tend to pursue their own ends, especially when they are concerned only with specialty. In the S S A the regional director coordinated the program bureaus and the functional bureaus which were concerned with specialty. T h e regional director insured the proper utilization of the contributions of the latter but checked their tendency to follow their own professional interests and dictates to the detriment of the objectives of the program bureaus. T H E T E C H N I C A L P R O B L E M S OF T H E S S A OF R E G I O N A L

TYPE

ORGANIZATION

Although multi-program, functionalized regional organization under general regional command is valuable, it is not without its difficulties. A s already stated, this volume is concerned with the story of its problems and their solution in the experience of the Social Security Board and the S S A . T h e history of the S S A to 1 9 4 7 revealed five difficulties which were generic to its type of regional organization. First, the Social Security Board and its successor, the S S A , faced the problem of constructing and maintaining regional areas and headquarters which would satisfy the administrative

SSA R E G I O N A L

ORGANIZATION:

ITS

NATURE

45

convenience of different programs. T h i s on the whole was a minor problem, for three of the S S A ' s four p r o g r a m bureaus and two of the Board's three p r o g r a m bureaus carried out federal-state programs and had the same clients—states. Therefore, areas based on groups of states were satisfactory to these programs. However, the bureau of old age and survivors insurance dealt largely with industrial workers and its areas needed to reflect the density of the industrial population. It is important to note that this problem of reconciling the needs of different programs for different areas can appear in any multiple regional decentralization even when the program bureaus are functionalizations of one job rather than four or five distinct tasks. F o r example, in the case of the W o r k s Progress Administration the same regions were not entirely satisfactory for carrying on work relief projects for both actors and industrial workers. T h e task of defining area in any type of multiple regional organization is one of resolving conflicting claims on the basis of the greatest values to be derived. The second problem of Board and S S A regional organization concerned the establishment of lines of supervision over the regional offices. F r o m the first many persons inside and outside of the old Social Security Board assumed that the supervision of the regional offices had to be based on tight theories of line and staff supervision, that all command would flow from the executive-director to the regional directors with the bureaus at the center and their representatives on the regional level relegated to purely staff roles on their respective levels. Since the variety and complexity of the jobs being carried out on the regional level precluded the total or absolute command of a regional director, several experts proposed the abandonment of multiple decentralization. But the Board continued with its multiple regional organization and adopted the concept of duality of command over its regions with an administrative line of command running f r o m the executivedirector to the regional director and technical lines of authority running from the bureaus to their regional representatives.

46

REGIONAL

ORGANIZATION

OF

THE

SSA

T h e Board's practice was justified by several writers on central-field relationships w h o noted that the so-called line of command is never unitary, that is, never involves all direction and authority even in military situations where the chain of command is commonly thought of as all powerful. 9 At the outset the Board's attempts at the definition of dual lines of authority were hard fought and not well understood in practice. T h e nature of general regional command was the third m a j o r problem of Board and S S A regional organization, for since the regional command of these organizations was not total and unitary, there was the question of the nature of its content. Regional command is never total or unitary, but operates within a defined f r a m e of reference and it is this fact which makes possible multi-program regional organization under general administrative command. However, it is true that in the case of integral undertakings, especially those dominated by a common profession such as the Forest Service or the division of health services of the children's bureau, regional administrative command in multiple regional organization may be more inclusive. A s the Social Security Board came to realize, in multi-prog r a m decentralization, regional command is more difficult to define and to practice. Board and S S A experience seems to indicate that regional command in multi-program decentralization must be general in nature, yet limited as to its sphere of competence and precisely defined. In fact, the validity of this type of regional decentralization depends on whether the general regional command employed is not so limited as to be useless and not so general that it permits action by the regional director in areas where he has no competence. As will be shown, the frame of reference for regional command in the case of the Board and the S S A was usually both useful and limited. Its usefulness was lessened to some extent by the 9 U r w i c k , " Organization as a Technical Problem," op. cit., pp. 57-85 and especially pp. 64-70. Arthur W . Macmahon, et al., op. cit., pp. 244-246, 265-268. John D . Millett, op. cit., pp. 106-116.

SSA R E G I O N A L

ORGANIZATION:

ITS

NATURE

47

small number of operating relations existing between the prog r a m bureaus. T h r o u g h hard experience the old Social Security Board and the S S A found that precise definition of the authority of the regional director was necessary because his role was at once general, limited, and varying. The old Board found that to say the regional director had general administrative authority was to add nothing to the clarity of lines of authority. Connected with the proper construction and definition of the nature of general regional command was the problem of selecting personnel competent to carry out its functions. T h e generalist with sufficient professional background and administrative ability is never easy to find. In the case of the S S A the general regional commander was also supposed to be a top negotiator in federal-state matters and, therefore, in addition a person of prestige and influence. T h e fourth problem of Board and S S A regional organization lay in the supervision of the regional representatives of the functionalized bureaus (called " services " in S S A terminology) which although apparently auxiliary were actually operative in federal-state matters. There was considerable clash between the regional representatives of the functional bureaus and those of the program bureaus, which embarrassed federal-state relations. Some critics of the Board and S S A type of regional organization have felt that duality of command inevitably leads to such clashes, and others have felt that functionalization inevitably leads to the clash of line and function. In the case of the Board and the S S A , however, the difficulties with regard to the supervision of the regional representative of the functionalized bureaus probably arose from the incorrect handling of four other organizational matters. The first was the problem of the proper separation of activities to be incorporated into the functionalized bureaus. Proper separation requires care in simple functionalization and is more easily violated when the

48

REGIONAL

ORGANIZATION

OF T H E

SSA

method of organizing the functional units is on the basis of subject. T h e great danger to be avoided in the case of the Board and the S S A was the placing of such activities in the functional bureaus as to make untenable the responsibility for the federal-state programs lodged in the program bureaus. T h e second problem involved the failure to recognize the operating nature of the functionalized bureaus and the failure to provide for the primacy of the line or program bureaus over the functional bureaus in federal-state matters. T h e third difficulty concerned, on the one hand, the control of the tendency of the functionalized bureaus to follow the dictates of their specialties regardless of the ends being sought by the program bureaus, and on the other hand, the control of the tendency of the program bureaus (mostly specialties) to ignore the contributions of the functional bureaus. T h e fourth problem involved the adequacy and nature of the work load of the regional representatives of the functional bureaus. Since these representatives were servicing the program bureaus, there was often the difficulty of providing them with enough work to keep them busy. Moreover, some activities proved too diversified and intricate to be handled separately f r o m the program bureaus. Of the five overall problems which had to be met in Board and S S A regional organization, the fifth and last concerned matters of clearance, coordination, communication and control. These in large measure were no different from those of any field projection of a multiple nature. Since they have been sparingly described in the literature, they have been dealt with at length in this volume. In the S S A type of regional organization, matters of clearance, coordination, communication and control were complicated by three factors. First, there were three kinds of command—general, program and functional— and a need for techniques of communication that would properly clear and channel each. Second, special techniques of clearance and coordination were indicated because of the existence of functional bureaus which had operating responsibilities. Third, the volume of communications and their differen-

SSA R E G I O N A L O R G A N I Z A T I O N :

ITS N A T U R E

49

tiation as to kinds of authority and as to levels and kinds of destination resulted in special problems in organizing communication manuals. Of course, the regional organization of the S S A was affected by other problems and situations beyond those which have been mentioned, but they were not particularly generic to the type of regional organization undertaken. Most important among these was the effect of central organization on regional organization. Thus the board type of organization reacted on the early establishment of regional organization by the Social Security Board. The transfer of various bureaus to and f r o m the Board and the S S A brought changes in the effectiveness of regional organization. On the whole, except through the wartime Community W a r Services, the Federal Security Agency had little effect on the regional organization of the Board and the S S A during t h e period under study; and this in itself was often unfortunate. SUMMARY

In summary of what has been stated in the preceding and present chapters, it can be said that while the generally significant aspects of S S A regional organization are not overlooked, it is the main purpose of this volume to point the way through S S A experience for the multiple regionalization of Federal departments or agencies composed of different jobs which nevertheless have field relations with regard to common clientele, objects of administration, area, specialties, programs or plans. Such regionalization can be accomplished effectively and economically by employing the concepts of dual (multiple) supervision and of general regional command. Furthermore, in any given situation the worth of such multi-program regional organization can be tested in large measure by the validity of general regional command. Where, for purposes of efficiency or economy or for other reasons, multi-program regionalization also involves functionalization, certain problems will arise and can be controlled, but they will not result

50

REGIONAL ORGANIZATION

OF T H E

SSA

from multiple command (which is inevitable) or from the nature of general command. There are also techniques of clearance, coordination, communication and control which can solve the added complications that multi-program, functionalized regional organization brings to regional decentralization.

CHAPTER III THE EVOLUTION OF THE ORGANIZATIONAL PATTERN OF THE SOCIAL SECURITY ADMINISTRATION IT was the Social Security Board rather than the S S A which experienced most of the significant problems of regional organization. T o a great extent, therefore, an analysis of S S A regional structure must be concerned with these old Board experiences. The tasks of the Social Security Board and its organization centrally and regionally were subject to many changes often of an involved nature. For all of these reasons and because central organization affects regional organization, it is necessary to review the history of the central and regional organization of the S S A and the Board. THE

RESPONSIBILITIES

I M P O S E D ON

B O A R D BY T H E S O C I A L

THE

SOCIAL

SECURITY

SECURITY

ACTS

The Social Security Act of August 14, 1935 established the Social Security Board and entrusted to its administration five of the programs created by the Act. Three of these programs gave the Board responsibility for administering grants to states for the partial payment of both the administrative costs and the allotments of assistance to dependent children, the needy blind and the needy aged. States were required to submit plans to be approved by the Board and in the Board's judgement to meet standards in the Act as to program and administration. A fourth program empowered the Board to administer a federal-state system of unemployment compensation. A federal tax (eventually 3 % ) was levied on the payrolls of all employers of eight or more engaged in industries covered by the 51

52

REGIONAL ORGANIZATION

OF T H E

SSA

Act. The Social Security Board was given the authority to certify those state unemployment compensation laws which conformed to the program requirements of the Social Security Act. Thereupon employers in the states with certified laws were allowed to deduct as much as 2 . 7 % against the Federal 3 % tax. All moneys collected by a state under its certified unemployment compensation laws were paid to its account in an Unemployment Trust Fund administered by the United States Treasury, and from it states requisitioned their funds to pay unemployment compensation to workers who qualified. In addition to certifying unemployment compensation laws for tax recapture purposes, the Social Security Board administered federal grants to states for the total cost of the proper and efficient administration of approved state unemployment compensation laws in accordance with standards in the Social Security Act. T h e fifth program entrusted to the Board's administration provided for federal old age benefits (later called old age insurance) to be directly administered by the Board to covered workers

(mostly industrial). The benefits were given on a

basis of right rather than need and were financed for the most part by taxes on workers and employers in covered industries. The collection of taxes from the employer, who deducted the worker's portion from his salary, was entrusted to the Bureau of Internal Revenue. The Secretary of the Treasury was made responsible for the management of the old age reserve account under conditions prescribed by the Social Security Act. T h e Social Security Board was established by the Act to be composed of three members appointed by the President with the advice and consent of the Senate for overlapping terms of six years. Members were to devote full time to their duties and were to receive $10,000 a year. T h e President was authorized to name one member of the Board as chairman. The Act made no other provisions as to organization and the Board

THE

EVOLUTION

OF

SSA

ORGANIZATION

53

w a s left free to organize a s it saw fit for the administration of its duties. 1 BOARD O R G A N I Z A T I O N TO C A R R Y OUT ITS R E S P O N S I B I L I T I E S THE

BUREAUS

In order to carry out its duties the B o a r d organized three " line " bureaus and five " staff " bureaus. T h e reaus, which were soon called public

assistance,

unemployment

" operating"

" line "

bureaus,

compensation,

and

buwere

federal

old age benefits. T h e " staff " bureaus, soon called " service " bureaus, were accounts and audits, business management, research and statistics, the general counsel, and the informational service. T h e bureau of public assistance w a s assigned the duty of certifying that state public assistance plans, laws and administration for programs for delinquent children, the needy blind and the needy aged were in conformity w i t h the requirements of the Social Security A c t . T h e bureau had the m a j o r responsibility for processing state budgets and g r a n t s to the states. It therefore reviewed state budgets and

financial

statements

and certified grants to the states for the partial payment of both administrative costs and the allotments of assistance to delinquent children, the needy blind and the needy aged. T h e bureau also g a v e technical advice and assistance to the states on public assistance legislation, p r o g r a m s and administration. T h e bureau of unemployment compensation w a s made responsible for c e r t i f y i n g that state unemployment compensation laws were in conformity w i t h the m i n i m u m p r o g r a m requirements of the Social Security A c t and therefore a basis for the enjoyment of federal t a x recapture by state employers.

The

bureau w a s also given responsibility for handling the g r a n t s 1 For an analysis of the first Social S e c u r i t y A c t see E v e l i n e M . Burns, Toward Social Security ( N e w Y o r k : W h i t t l e s e y House, M c G r a w - H i l l B o o k Company, Inc., 1936). See also P a u l H . D o u g l a s , Social Security in the United States ( N e w Y o r k : Whittlesey House, M c G r a w - H i l l Book Company, Inc., 1936).

54

REGIONAL

ORGANIZATION

OF T H E

SSA

to states for the total costs of the administration of their unemployment compensation systems. Accordingly, the bureau reviewed state budget requests and financial statements and certified that state administration of unemployment compensation was in conformity with the administrative standards of the Social Security Act. In addition, the bureau also gave technical advice and assistance to states on legislation, administrative organization and procedure. The bureau of federal old age benefits was established to administer the only completely federal job entrusted to the Board. Its duties were to register each worker covered by the terms of the Social Security Act, to see that taxes were properly paid and reported by the employer, 2 to keep individual accounts for covered workers, to settle and pay claims, to hear appeals of workers and to insure the actuarial soundness of the insurance program. The " service " bureaus were established to carry out auxiliary activities for the Board as a whole and for its bureaus and to share responsibility with the bureaus of unemployment compensation and public assistance in the administration of their federal-state activities. The " service " bureaus were in part operating functionalizations of the jobs of the two bureaus of unemployment compensation and public assistance. Thus, the general counsel was responsible not only for the legal work of the Board and its bureaus, but also for the certification of the legal conformity of all state legislative, administrative, and judicial acts (opinions of attorneys general as well as court decisions) with the provisions of the Social Security Act. The general counsel gave states legal advice and assistance where Board programs were involved. The bureau of research and statistics was given the main responsibility for carrying out the legislative mandate to the Board to study and report on the whole problem of social se2 Of course the collection of taxes was the responsibility of the Bureau of Internal Revenue.

THE EVOLUTION

O F SSA O R G A N I Z A T I O N

55

curity in the United States. B u t it w a s also made responsible f o r deciding state compliance with the statistical and reporting requirements of the Social Security Act, for collecting state statistical reports, and for doing research in methods and procedures to be suggested to state unemployment compensation and public assistance agencies. T h e informational service was given jurisdiction over public relations for the B o a r d and its bureaus, especially the bureau of federal old age benefits. It was also made responsible for editing publications and for the administration of the library. But a short while after its establishment, it too was given a federalstate function to advise states on the planning and operation of their informational services as f a r as unemployment compensation and public assistance were concerned. T h e bureau of accounts and audits was established to carry out not only the internal budgeting, 3 accounting and auditing f o r the Board and its bureaus, including the huge accounting job of the bureau of federal old age benefits, but also to do the auditing of state funds, accounts and financial reports in the case of the unemployment compensation and public assistance programs. Assistance payments were likewise audited. T h e audits in the case of the federal-state programs checked state compliance with the Board's fiscal, business and management standards, and violations resulted in disallowance of federal funds improperly spent. T h e bureau also undertook to establish proper accounting and fiscal systems for states upon request. T h e bureau of business management, like the informational service, at first had no duties in regard to the Board's federalstate programs. T h e bureau w a s assigned all of the personnel and housekeeping services of the Board with the exception of the library, which was located in the informational service. On November 1 5 , 1 9 3 7 , the bureau of business management established the state technical advisory service to aid states in estab3 For a short while at the outset budgeting was a responsibility of the bureau of business management.

56

REGIONAL

ORGANIZATION

OF T H E

SSA

lishing merit personnel systems for their public assistance and unemployment compensation programs. T h e B o a r d ' s organization as to bureaus and their responsibilities remained practically the same from the beginning until 1 9 3 9 at which time the amendments to the Social Security A c t and the 1939 general reorganization of Federal agencies caused the B o a r d to change its administrative structure. Certain minor changes of bureau duties before 1 9 3 9 may be noted. T h e informational service, as already mentioned, took on the responsibility

of

advising

state unemployment

compensation

and

public assistance agencies a s to their public relations. O n the other hand, the service lost its supervision of the library and its responsibility

for a n s w e r i n g

routine public inquiries to the

bureau of business m a n a g e m e n t ; it lost its j o b of editing and r e v i e w i n g professional and technical publications to the bureau of research and statistics. T h e bureau of federal old age benefits w a s limited to short range actuarial w o r k , and an independent office of the actuary w a s established to advise the B o a r d on long term actuarial matters. O n the other hand, the bureau established its own accounts for federal old age benefits, taking this activity from the bureau of accounts and audits. It also developed its o w n research and analysis. Lastly, the name of the bureau of federal old age benefits w a s changed to the bureau of old age insurance in order to distinguish its p r o g r a m f r o m that of the bureau of public assistance. T w o bureaus lost activities to the g r o w i n g office of the executive director. T h e bureau of accounts and audits continued to do the w o r k involved in the preparation of the budget, but the responsibility for budgetary determination was transferred to the g r o w i n g authority of the executive director. Similarly, the bureau of business management's advisory service to states on merit personnel systems w a s transferred to the office of the executive director as the state technical advisory service. 4 4 Much of the above description was obtained by interview; but it may also be found in the annual reports and functional charts of the Social Security Board. See the functional charts processed by the Social Security

THE

EVOLUTION

OF

SSA

ORGANIZATION

57

T H E BOARD, T H E COORDINATOR A N D T H E E X E C U T I V E DIRECTOR

It is to the B o a r d ' s credit that a s early as N o v e m b e r 27, 1935, it chose to refrain f r o m a s s i g n i n g administrative duties to its members. It decided to deal only w i t h matters of policy either as to p r o g r a m or administration and to establish an executive director to be in c h a r g e of all matters flowing to the B o a r d , to attend all meetings of the B o a r d , and to coordinate and direct the bureaus and the regional directors and their offices. But the intention of the B o a r d w i t h regard to the executive director w a s hampered at the outset by its own activity in the area of administration, by its creation of the office of the coordinator and by its failure to g i v e the executive director the necessary staff aides. In the beginning the Social Security B o a r d became involved individually and collectively in d a y by d a y administration and supervision. 5 It even went so far as to approve all appointments above P - 2 or C A F - 7 ( o v e r $ 2 6 0 0 ) . O f course, it w a s difficult in the beginning for the B o a r d to delegate all administrative matters to an executive officer w h e n there w a s little else to do except to get the large social security operation started. T h e B o a r d ' s management engineer suggested that realistically each B o a r d member might take responsibility for one of the three m a j o r fields at the outset and later on concentrate as a g r o u p on policy matters. 6 B y

1938, however, the Board had

suc-

ceeded in limiting its activities to policy matters, to final action Board for December 4, 1935; 1936; November 10, 1937; September 20, 1938; and November 3, 1939. See also Social Security Board, First Annual Report of the Social Security Board for Fiscal Year Ending June 30, 1936 ( W a s h i n g t o n : Government Printing Office, 1937), pp. 4, 5, 6o-6i, 69, Second Annual Report of the Social Security Board, 1937, pp. 95, 69-75, Third Annual Report of the Social Security Board, 1938, pp. m - 1 2 0 , 139. 5 Donald C. Stone, Report on the Organization and Administration of the Social Security Board ( C h i c a g o : Public Administration Service, 1936), p. 2. (Processed.) 6 Memorandum of H . A . Hopf to A . J. Altmeyer, V . M. Miles and F. Bane, " T h e Organization Problem," M a y 4, 1937. (Typewritten.)

58

REGIONAL

ORGANIZATION

OF T H E

SSA

w i t h r e g a r d to the federal-state p r o g r a m s , and to m a j o r adm i n i s t r a t i v e decisions. 7 T h e office of the coordinator w a s established at the s a m e time a s the office of the executive director, in N o v e m b e r 1 9 3 5 , a n d with

responsibility

for a d m i n i s t r a t i v e

methods

and

organi-

z a t i o n , f o r coordination w i t h other F e d e r a l departments and agencies, and for a c c o u n t i n g procedures. T h e c o o r d i n a t o r spent a g r e a t deal of e f f o r t o n the a d m i n i s t r a t i v e o r g a n i z a t i o n a n d p r o c e d u r e s of the bureau of accounts a n d audits a n d of the b u r e a u of federal old a g e benefits, and on regional and field org a n i z a t i o n . T h e coordinator reported directly to the B o a r d a n d t h o u g h concerned w i t h administrative o r g a n i z a t i o n a n d cedure, w a s not under the chief a d m i n i s t r a t o r — t h e

pro-

executive

director. A conflict developed between the coordinator a n d the e x e c u t i v e director, and a s a result the position of c o o r d i n a t o r w a s abolished on September

12,

1936, and its duties

were

t r a n s f e r r e d t o the office of the e x e c u t i v e director. A f t e r the office of the c o o r d i n a t o r w a s abolished, the a u t h o r i t y of the executive director b e g a n to d e v e l o p ; the p r o c e s s of

development

continued

through

1940.

The

office of

the

e x e c u t i v e director w a s initially c h a r g e d w i t h responsibility f o r the a d m i n i s t r a t i v e supervision of the bureaus and the r e g i o n a l offices a n d f o r m a i n t a i n i n g cooperation w i t h the states. A

field

d i v i s i o n w a s set up as a staff aid in the supervision of r e g i o n a l offices. I n 1 9 3 6 after the abolishment of the office of the coo r d i n a t o r , a c o o r d i n a t i n g a n d procedure division w a s

estab-

lished in the e x e c u t i v e d i r e c t o r ' s office. 8 In the same y e a r , as a l r e a d y stated, the executive director w a s g i v e n the

respon-

sibility for b u d g e t a r y determination. A s has been noted, the Security 7 Cf. D o n a l d C. Stone, Organization Problems of the Social Board with Special Reference to the Bureau of Unemployment Compensa-

tion (Chicago: Public Administration Service, April, 1938), p. 7.

(Pro-

cessed.) 8 See the recommendation of Donald C. Stone in his Report on the Organisation and Administration

of the Social Security

Board, pp. 3-22.

THE

EVOLUTION

OF SSA

ORGANIZATION

59

state technical advisory service w a s also placed in the executive director's office, but the reason for this is not clear unless it w a s because the service w a s not large enough to w a r r a n t independent status. 9 A s the role of the executive director developed up to 1939, his duties as coordinator of bureau activities and arbitrator of their differences became more pronounced. T h e opportunity f o r such a role on the part of the executive director arose because some of the federal-state activities of the three p r o g r a m or " operating " bureaus had been functionalized into the functional or " service " bureaus. A f t e r the first executive director resigned in 1938, the direct w o r k of the executive director w i t h the states declined. Moreover, the second Chairman of the S o cial Security Board dominated the Board and became the de facto administrator of the whole establishment. A s matters developed, the executive director became not the executive of a policy-making board but a chief of a general staff for the chairman of the B o a r d w h o was, in truth, the director of the w h o l e operation. T H E E S T A B L I S H M E N T OF FIELD O R G A N I Z A T I O N

T h e B o a r d ' s w o r k lay not in W a s h i n g t o n , its headquarters, 1 0 but throughout the United States and even in A l a s k a

and

H a w a i i . In the case of unemployment compensation and public assistance the Board's j o b w a s one of dealing with state a g e n cies, governors, and legislatures and even with state civil service establishments, fiscal officers, and attorneys general.

The

B o a r d had the j o b of g i v i n g assistance to states and of per9 One explanation was that the state technical advisory service needed the immediate support of the executive director in its work with the states and with the program bureaus. 10 Most of the headquarters work of the bureau of federal old age benefits was carried out in Baltimore. In 1942 the whole central bureau (by this time called the bureau of old age and survivors insurance) was moved to Baltimore.

ÔO

REGIONAL

ORGANIZATION

OF T H E

SSA

suading them to pass laws and to establish the kind of administration and procedures which w o u l d not only meet the standards of the Social Security A c t but w o u l d achieve the best aims of the various programs and the most efficient administration of them. B u d g e t s and financial reports had to be reviewed with state officials, administration reviewed, accounts audited and state

fiscal

systems examined and even overhauled.

It

was

obvious that to do all of these things through the travel of federal officials out of W a s h i n g t o n would be costly and inconvenient both for the states and the Social Security Board.

A

field organization of the Board w a s required. In the case of federal old age benefits, workers had to be given social security cards with their account numbers, employer

tax

reporting had to be verified in order

to

keep

workers' accounts accurate, workers and employers had to be educated concerning their responsibilities and benefits under the act, and eventually the claims of employees had to be adjudicated and paid. A g a i n a field organization w a s indicated and not only on a regional level but on a local level as well, where both the w o r k e r and employer could be contacted. T o explore the matter of field organization the B o a r d established a field organization committee on December 2,

1935

under the jurisdiction of the coordinator. In addition, a management engineer, w h o w a s hired by the Board upon the suggestion of the coordinator, advised on regional and field organization, especially for the bureau of federal old age benefits. T h e executive director spent a great deal of effort on the recruitment

and

training

of

personnel

who

later

served

as

executive assistants to the regional directors. T h e field organization committee made recommendations concerning the establishment of regional offices, their location and area, and the authority of the regional director. It also made proposals with regard to the field structure of the bureau of federal old age benefits. T h e Board itself w a s quite active in the whole matter of establishing the regional organization and made considerable changes in the area and location of regional offices.

THE

EVOLUTION

O F SSA O R G A N I Z A T I O N

6l

It chose the regional directors ( w h o incidentally were exempt f r o m civil service requirements) almost entirely without the advice of the executive director or the coordinator. T h e proposal of the field organization committee to establish regional offices under regional directors met resistance from the bureaus, w h o s e directors were willing to place bureau representatives in the field but were opposed to their subordination to the authority of regional directors. Nevertheless, on M a y i , 1 9 3 6 seven regional directors were sent to set up the first of the twelve regional offices which the Board had decided to establish. T h e regional directors were to represent the Board in their region and were to have general administrative supervision of the regional representatives of the bureaus w h o were to remain technically responsible to their bureaus. B y the end of 1936 twelve regional offices and 108 field officers (below the regional level and for the administration of federal old age benefits) Boston, Chicago, Antonio,

were established. Regional offices were located at New

York,

Philadelphia,

Minneapolis, Denver and

Washington,

Birmingham,

Kansas

Cleveland, City,

San Francisco with supervision

San over

areas composed of groups of states. Each regional office w a s composed of a regional director, his

executive

assistant,

personnel

providing

administrative

services, and representatives of each of the B o a r d ' s bureaus and their staffs with the exception of the bureau of business management. T h e regional office furnished housing and administrative services for the regional representatives, but it should be noted that at the outset final determination in matters of personnel, travel, payroll, communications and supplies were all handled out of Washington. T h e regional representatives dealing with federal-state matters carried on their bureaus' w o r k with the states within the regional area served by the regional office. T h e regional representative of federal old age benefits w a s responsible for the training and supervision of the field offices within the area of the regional office. T h e main criterion for locating these field offices w a s the concentration in a n y area

62

R E G I O N A L O R G A N I Z A T I O N OF T H E SSA

of a large number of persons covered by the federal old age benefits p r o g r a m . 1 1 T h e y were responsible for educating employers and workers as to their responsibilities and benefits, the assignment of social security cards

(account numbers), the

policing of proper reporting of taxes, and the development but not the adjudication of claims. Accounting and the adjudication of claims were kept as central activities. 1 2 Controversy over the regional organization of the B o a r d occurred among staff members and consultants to the B o a r d until the end of 1 9 3 7 . A s will be noted later the resulting discussion w a s illuminating as to the problems of the S S A type of regional organization and as to possible alternative regional

organi-

zation. Gradually the Board came to understand and to clarify the concepts involved in its type of regional decentralization. 11 The field organization committee proposed that there be at least one district office in each state and more depending on the compensable load. These district offices were to have supervision of primary and secondary offices within their districts. The Board abandoned the idea of primary and secondary offices and called them all branch offices of equal complement and status. By April 1937 the distinction of district offices and branch offices had also been abolished and all of the offices were called field offices and were equally under the direct supervision of the regional representative of federal old age benefits. Their complement varied with their compensable loads. 12 The Board's management engineer proposed that accounting and adjudication should be made a regional function. See Memorandum of H. A. Hopf to A. J. Altmeyer, " Regarding the Eventual Complete Reorganization of the Board," May 24, 1937. (Typewritten.) See also Memorandum of H. A. Hopf to the Social Security Board, " Steps Required to Put into Effect the Recently Adopted Policy of the Board with Respect to the Reorganization of the Bureau of Federal Old Age Benefits," May 24, 1937. (Typewritten.) The Board ran a test program of the Hopf proposal by setting up regional accounting units at the center. Claims adjudication was also tested on a regional basis but for only one region. In 1939 the Board abandoned the experiment because it resulted in the inefficient use of machines in the case of accounting operations and because it raised the problem of inter-regional transfers when workers moved. See Federal Security Agency, Fourth Annual Report of the Social Security Board, 1939 (Washington: Government Printing Office, 1940), p. 19. But claims adjudication was finally decentralized, for in 1942 area claims offices were established in the field.

T H E EVOLUTION

OF SSA O R G A N I Z A T I O N

63

Some changes in definition of authority occurred, but on the whole the structure of regional organization and the lines of authority remained as they have been described. COMMENTS ON T H E ESTABLISHMENT OF THE BOARD'S REGIONAL

STRUCTURE

The process of establishing the regional structure of the Social Security Board was hampered by the organizational structure at the top. The Board, as a board, did not function well in the task of setting up regions and of getting the regional offices started, and there was confusion of authority and indeed considerable rivalry between the coordinator and the executive director. At least one member of the Board itself and several top staff members were drawn into this conflict. The Board was not able to ward off political pressure, and while it did block one of its members in his all-out cooperation with patronage-minded members of Congress in the making of regional appointments, it could not withstand in every instance pressure from its own political friends. Capricious and unfortunate changes of regions and of regional headquarters from those suggested on an expert basis by the field organization committee were made by the Board, either to ward off or to satisfy pressures from senators, the White House or Board members. 13 Finally, in order to avoid the increasing political pressure, the Board opened its regional offices ahead of time and without sufficient preparation. The experiences of the Social Security Board seem to indicate that a plan to establish a field organization should not be publicized, but should be carefully prepared and quickly executed. They also indicate that a Board has no peculiar capacity to ward off political pressure but may, in fact, face the additional job of handling politics within its own ranks. It would appear that the executive director at first did not play an important role in the job of regional organization since 13 See infra, pp. 119-123.

64

REGIONAL

ORGANIZATION

OF

THE

SSA

the field organization committee was under the jurisdiction of the coordinator. T h e coordinator was also responsible for the appointment of the Board's management engineer, who advised on regional organization as well as other organizational matters. T h e executive director who was to command the regional directors had practically nothing to say about their selection. The executive director's authority over the regional directors was further confused at the outset because the Board came to regard them as its representatives in the regions. Proposals on regional organization originating in the office of the coordinator or from persons under his supervision showed a definite bias against the position of the executive director. T h e reverse was also true, and, of course, good organizational analysis suffered accordingly. C H A N G E S OF S O C I A L S E C U R I T Y

BOARD O R G A N I Z A T I O N ,

1939" 1 941 T H E A M E N D M E N T S OF

I939

T h e organization of the Social Security Board remained substantially as described until 1939 when the amendments to the Social Security A c t and the reorganization of Federal agencies in that year brought significant changes. The most important changes made by the amendments of 1939 involved the old age insurance program. Annuities for survivors of a defined relationship were added to the benefits available to workers covered by the program. More workers were also brought under the protection of the program by including new types of employment and by making easier the conditions for qualification for benefits. A new class of benefits for workers who worked in covered employment for only limited periods was also added. The bureau of old age insurance accordingly changed its name to the bureau of old age and survivors insurance and increased its field offices to meet the demands of the new load caused by the increase of its program. 1 4 14 The approaching date for the payment of monthly benefits, January 1, 1940, also caused an increase in field offices. Until this date only lumpsum death payments were made.

THE

EVOLUTION

OF SSA O R G A N I Z A T I O N

65

T h e new amendments also established in detail the rights of claimants in appealing the determinations of their old age or survivors benefits to the Social Security Board, and in appealing from the Board to the courts on questions of law. A s a result of the new provisions, on March 1 , 1940, the hearing of appeals was taken out of the bureau of old age and survivors insurance and was placed in an independent appeals council. 1 5 T h e council was composed of three persons and was headed by a chairman. Its decisions were subject to review by the general counsel and the Social Security Board. T h e appeals council established nine regional referees in nine regional offices to hear initial appeals and to make decisions subject to review by the council upon appeal or through referral by the referee. While these referees were housed in regional offices which provided them with administrative services, they were not subject to the authority of the regional director. T h e 1 9 3 9 amendments also affected the federal-state programs. They widened the coverage of unemployment compensation and increased the amount of public assistance grants which the Federal government would match, except in the case of aid to dependent children where the Federal matching proportion was increased. T h e standards which the states had to meet to receive grants for the administration of the public assistances and unemployment compensation were amended to require after J a n u a r y 1, 1 9 4 0 the establishment and maintenance of personnel standards on a merit basis. T h e state technical advisory service expanded accordingly and placed regional representatives, called personnel methods consultants, in all of the regional offices. These men were made subject to the administrative direction of the regional directors and to the technical direction of their bureaus, as in the case of all the other regional representatives. T h e y carried out their duties in the same fashion as the other " service " or functional represent s Cf. the recommendations of the Attorney General's Committee on Administrative Procedure, Administrative

Procedure

in Governmental

(Washington: Government Printing Office, 1941), pp. 55-60.

Agencies

66

R E G I O N A L O R G A N I Z A T I O N OF T H E SSA

tatives. T h e state technical a d v i s o r y s e r v i c e , h o w e v e r , did not acquire the independent status of the other functional bureaus, but remained a part of the office of the e x e c u t i v e d i r e c t o r . 1 8 THE FEDERAL REORGANIZATION OF 1 9 3 9 U n d e r R e o r g a n i z a t i o n P l a n N u m b e r I of 1939, a u t h o r i z e d b y the R e o r g a n i z a t i o n A c t of 1939, the S o c i a l S e c u r i t y B o a r d lost its independence and w a s i n c o r p o r a t e d in the n e w F e d e r a l S e c u r i t y A g e n c y . P l a n N u m b e r I also t r a n s f e r r e d the e m p l o y ment service f r o m the D e p a r t m e n t of L a b o r t o the B o a r d a n d combined

it w i t h

functions.

The

old

the

Board's

bureau

of

unemployment

compensation

unemployment

compensation

w h i c h received the n e w e m p l o y m e n t service activities had its n a m e changed to the bureau of e m p l o y m e n t security. T h e title of the regional representative of u n e m p l o y m e n t

compensation

became regional representative of e m p l o y m e n t security, and h i s staff w a s appropriately increased. T h e transfer of the e m p l o y m e n t s e r v i c e t o the S o c i a l S e c u r ity B o a r d and its o r g a n i z a t i o n a l o n g w i t h u n e m p l o y m e n t c o m pensation into the single bureau of e m p l o y m e n t security w a s based o n the fact that on the state a n d local level, the t w o prog r a m s w e r e o r g a n i z e d together and h a d interlocking activities. In the local offices the u n e m p l o y m e n t c o m p e n s a t i o n a n d e m ployment e x c h a n g e activities v a r i e d inversely, and office personnel w a s usually transferred f r o m one t o the other. 1 7 It w a s , accordingly, v e r y difficult to separate the activities of personnel for budget purposes, a n d the same w a s true of m a n y

other

costs of the t w o p r o g r a m s . Y e t , until the transfer, this separation of costs h a d to be attempted b y the D e p a r t m e n t of L a b o r in g r a n t i n g m o n e y to the states f o r the a d m i n i s t r a t i o n of e m ployment services and by the B o a r d in g r a n t i n g m o n e y t o the 16 Only the gist of the amendments as they affected organization has been given here. For a complete analysis of the 1939 amendments, see Social Security Board, Compilation of Social Security Laws (Washington, D. C.: Federal Security Agency, 1940). 17 It was later found that in conversion to war and reconversion from war the two functions were both at peak load at the same time.

THE

EVOLUTION

OF

SSA

ORGANIZATION

67

states for the administration of unemployment compensation. 18 T h e transfer of the employment service to the Social Security Board was made, therefore, to clarify and to eliminate unnecessary duplication in Federal budget and grant processes, to avoid competition between Federal agencies and programs in dealing with the states, and to facilitate the clarification and better promotion of federal standards required of the states. 19 T h e transfer, consequently, improved the work being carried out on the regional level with the states. The Effect

of the Creation

of the Federal

Upon the Organisation

Security

and Administration

the Social Security

Agency of

Board

The creation of the Federal Security A g e n c y began with Reorganization Plans I and II in 1939 and was completed with Reorganization Plan I V in 1940. In addition to the Social Security Board, the A g e n c y included other organizations dealing with health, welfare, relief and security. T h e y were the Civilian Conservation Corps, the National Y o u t h Administration, the Office of Education, the Public Health Service, the Food and D r u g Administration, the American Printing House for the Blind, St. Elizabeth's Hospital, Freedmen's Hospital, H o w a r d University and Columbia Institution for the Deaf. T h e Reorganization A c t of 1939 emphasized the objectives of economy, efficiency and the avoidance of overlapping and duplication of effort. Until 1946, however, the new Federal Security A g e n c y had little effect on its constituents except for one wartime program. Several factors retarded the internal development of the Federal Security A g e n c y toward the consolidation and co18 Cf. R a y m o n d C. Atkinson, Louise C. Odencrantz, and Ben D e m i n g , Public Employment Seri'ice in the United States ( C h i c a g o : Public A d m i n istration Service,

1940), p p . 38-51, 87-95, 99-110. 251-253.

19 Only the a r g u m e n t s for the transfer of U S E S are noted since they were the reasons for the transfer. For a different point of view see P r e s i dent's Committee on A d m i n i s t r a t i v e Management, Report of the President's Committee, p. 35.

68

REGIONAL

ORGANIZATION

OF T H E

SSA

ordination of constituent activities and toward significant central overall direction. First, the authority of the Federal Security Administrator over his constituents was not clear since their organization was statutory. Second, congressional reorganization of the internal structure of the Agency through appropriation acts was limited to a few matters of business management, which were carried to the Agency level, and to two matters of the program activities of two dying organizations. Third, Paul V. McNutt, the first Administrator of the Federal Security Agency, became involved in war activities as the Coordinator of health, welfare and related activities, and as the Chairman of the W a r Manpower Commission. H e had neither the time for nor an interest in developing the central direction of the Agency or in changing the Agency from a loose organization of constituents to a closer knit single department. The central aides of the Federal Security Administrator had imposing descriptions of duties which existed mostly on paper; the central personnel really had little effect on the work of organizations within the Agency. There was an Assistant Administrator who aided the Administrator in all of his duties and acted for him in his absence. T w o or three assistants to the Administrator acted as staff aides in the supervision of groups of constituents, but their work produced small results except for defense or war activities. A single director of research without any assistance tried to stimulate the coordination of research between Agency constituents and with outside Federal organizations. A n office of the executive assistant to the Administrator was responsible through its divisions for budget, personnel, administrative planning, administrative services and information (later provided for in an independent office of information). T h e budget division and an attendant budget committee held trial budget hearings for Agency organizations before their appearance at the Bureau of the Budget. But within the Agency,

THE

EVOLUTION

OF SSA

ORGANIZATION

69

budget determination remained on the constituent level. T h e division of administrative planning of the office of the executive assistant had no effect on the administrative organization of the A g e n c y or its constituents.

Personnel activities were for a

short time placed on the A g e n c y level, but later returned to the constituent organizations. T h e information service handled public relations only for the Office of the Administrator. A d ministrative services w a s similarly limited to w o r k for the O f fice of the Administrator except that it took over the printing and duplicating w o r k for the whole A g e n c y . 2 0 T h e most important central A g e n c y unit w a s the office of the general counsel, which handled the legal w o r k for the entire A g e n c y and for its various organizations. It is not surprising that program coordination and consolidation carried out at the center by the A g e n c y w a s w e a k and the effect on field activities w a s unimportant. T h e r e w a s no central organization of any kind to deal with field or federalstate operations. S o m e idea of the attempts at p r o g r a m coordination m a y be obtained f r o m noting those which affected the Social Security Board. E a r l y in 1942 the placement w o r k of the National Y o u t h Administration w a s taken over by the employment service as required by Congress in appropriating in 1941. T h e result w a s hardly satisfying, for according to E v e l i n e B u r n s youth guidance and placement w o r k collapsed. W h e n the Office of Education in 1940 took over supervision of the training and educational w o r k for the National Y o u t h A d m i n i s t r a tion, much the same thing happened. 2 1 T h e organization of the Federal Security A g e n c y did result in changes of the organizational structure of the Social

Se-

curity Board. T h e Board's general counsel w a s transferred to 20 It should be noted that when the Federal Security A g e n c y developed wartime activities, auxiliary services were provided by the Agency's central staff through the office of the executive assistant to the administrator. 21 Committee on Long Range W o r k and Relief Policies, U . S. N a t i o n a l Resources Planning Board, Security, Work and Relief Policies (Washingt o n : Government Printing Office, 1942), pp. 377-381.

"JO

REGIONAL

ORGANIZATION

OF T H E

SSA

the A g e n c y level and became the nucleus f o r the A g e n c y ' s office of the general counsel, w h i c h served all A g e n c y

constituents.

T h e regional attorneys of the S o c i a l S e c u r i t y B o a r d thus became

technically

responsible

to

the

general

counsel

of

the

F e d e r a l S e c u r i t y A g e n c y , but they c o n t i n u e d t o c a r r y out their same duties under the general a d m i n i s t r a t i v e direction of the B o a r d ' s r e g i o n a l directors. T h e s e r e g i o n a l a t t o r n e y s remained the o n l y

field

staff

of

the

general

counsel,

but

for

some

time they serviced only the S o c i a l S e c u r i t y B o a r d ' s " operati n g " r e g i o n a l representatives. A s h a s been noted, printing, d u p l i c a t i n g a n d b i n d i n g services a n d personnel services w e r e t r a n s f e r r e d t e m p o r a r i l y to the A g e n c y level. T h e r e u p o n the S o c i a l S e c u r i t y B o a r d abolished its

bureau

of

business

management

and

b u r e a u ' s r e m a i n i n g duties t o the e x e c u t i v e

transferred

this

director's office,

w h i c h h e n c e f o r t h handled all business m a n a g e m e n t a s well a s general m a n a g e m e n t for the B o a r d . T w o other r e o r g a n i z a t i o n s of s o m e i m p o r t a n c e occurred in the B o a r d d u r i n g the period under c o n s i d e r a t i o n . T h e y

rep-

resented a retreat f r o m f u n c t i o n a l i z a t i o n . T h e bureau of employment security in 1939 a n d the b u r e a u of public assistance in 1941

received by transfer f r o m the b u r e a u of research

and

statistics those research activities w h i c h dealt w i t h the statistical reports a n d standards required of the states a n d w h i c h w e r e concerned w i t h the a d m i n i s t r a t i v e a n d p r o c e d u r a l problems of state a g e n c i e s and p r o g r a m s . 2 2 T h e b u r e a u of public assistance added a regional research assistant to its r e g i o n a l s t a f f s under the " g e n e r a l supervision a n d p r o g r a m leadership of the reg i o n a l representative " a n d under t h e " technical supervision " of the b u r e a u ' s division of research a n d statistics. T h e bureau of e m p l o y m e n t

security n e v e r developed a r e g i o n a l

research

person, a n d the departure of its e m p l o y m e n t service functions t o the W a r M a n p o w e r C o m m i s s i o n in 1 9 4 2 d e p r i v e d it of the 22 The change had been recommended earlier by Donald C. Stone. See Donald C. Stone, Organizational

pp.

3

and

4.

Problems

o/ the Social

Security

Board,

THE

EVOLUTION

OF SSA O R G A N I Z A T I O N

71

research load necessary to j u s t i f y a regional research person. T h e bureau of research and statistics lost all of its regional staff, most of w h o m went to the bureau of public assistance. T h e other significant reorganization involved the bureau of accounts and audits and the bureau of public assistance.

In

1940 the regional auditors were forbidden to audit for eligibility, and the duty w a s assigned to the bureau of public assistance, which developed its own audit based on social

work

rather than fiscal principles and accordingly increased its regional staff. SUMMARY

D u r i n g 1 9 3 9 - 1 9 4 1 , therefore, as a result of the amendments of 1939, of the governmental reorganization of that year, a n d of the reorganization within the B o a r d on its own initiative, the regional organization

changed considerably.

A

regional

referee w a s housed in the regional office, but w a s made independent of the authority of the regional director. A personnel methods consultant w a s added to the regional staff w i t h the same definition of lines of responsibility as in the case of the other functional representatives. T h e regional representative of unemployment compensation w a s given the additional responsibility for negotiations with states in regard to g r a n t s for state employment services. H i s staff w a s increased and his title became regional representative of employment security ( f o l l o w ing the new name of his bureau). T h e functional bureaus carried out the same activities for his new federal-state p r o g r a m a s they had for his old one. T h e regional attorney of the Social Security B o a r d became technically responsible to the general counsel of the A g e n c y , but his duties as well as his responsibility to the B o a r d ' s regional director remained the same. A s the bureau of research and statistics lost its regional staff, the bureau of public assistance added a research consultant to the staff of its regional representative. T h e bureau of public assistance also increased its regional staff to undertake a new administrative audit.

72

REGIONAL

ORGANIZATION

OF T H E

T H E D E F E N S E AND W A R

SSA

PERIOD

Defense and w a r activities brought m a j o r changes in the organization and the programs of both the Federal

Security

A g e n c y and the Social Security Board. In September 1942 the National Y o u t h Administration w a s transferred by executive order to the W a r M a n p o w e r Commission, and in the

fiscal

year 1942-1943 the Civilian Conservation Corps w a s liquidated in accordance with the stipulations of congressional appropriations. In December 1942 the employment service w a s nationalized, and in September of the same year it w a s transferred f r o m the Board to the W a r M a n p o w e r Commission. But the A g e n c y also gained activities. In N o v e m b e r

1940

the Council of National Defense made the Federal Security A d ministrator the Coordinator for all health, medical, welfare, nutritional and related activities affecting national defense. B y executive order these duties of the Administrator later became incorporated in the Office of Defense, Health and Services

in

the

Office

of

Emergency

Welfare

Management.

Mr.

M c N u t t , the Federal Security Administrator, became the D i rector of the Office of Defense, Health and W e l f a r e Services. In A p r i l 1943 the Office w a s transferred to the Federal Security A g e n c y under the name Community W a r Services w i t h a director w h o for the first time w a s not the Federal Security Administrator, but w a s under his jurisdiction. A n o t h e r

ad-

dition to A g e n c y activities deserves mention. In 1943 the Office of Vocational Rehabilitation w a s established in the

Federal

Security A g e n c y with an expanded program. T h e regional organization of the Social Security B o a r d w a s affected by defense and wartime changes. A t the outset of the defense period, the regional representative of employment security became the regional labor supply officer for defense programs. H e w a s given an associate regional representative to lighten his burden by taking over the unemployment compensation activities. Then, of course, in 1942 the employment security representative lost his labor supply and

employment

THE

EVOLUTION

OF SSA O R G A N I Z A T I O N

73

service activities to the W a r Manpower Commission, which established its own regional set-up. In January 1 9 4 1 the regional directors of the Social Security Board were designated by Paul V . McNutt as regional coordinators of health, welfare, nutritional and related activities. In accordance with the reorganization of these activities just described, the Board's regional directors became successively the regional directors of defense, health, and welfare services, and the regional directors of community war services. Working under central coordination and agreement, the regional directors operated as stimulators and coordinators of local, state and federal action. However, the main emphasis of the regional director's work was on the coordination of Federal agencies working in the health, welfare and related fields. The organizations coordinated by the regional director within the Federal Security Agency were the following: the bureau of public assistance, Social Security B o a r d ; the Public Health Service; the Office of Education; and the divisions of recreation, social protection and day care which were created for the period of the war for Community W a r Services. The main agencies outside of the Federal Security Agency, but included within the coordinating sphere of the regional director, were the Federal Public Housing Authority, the Federal W o r k s Agency, the W a r Manpower Commission, the United Service Organizations, and the Office of Civilian Defense. T h e authority of the regional director varied depending on his relationship to the cooperating organizations, but on the whole he acted as a planner, a convener and a coordinator. F o r these functions he was staffed with a secretariat and two research assistants. The duties of Community W a r Services were liquidated in accordance with congressional appropriation stipulations during the fiscal year 1945-46. After the Office of Vocational Rehabilitation was established in 1943 with its expanded functions in the Federal Security Agency, it developed a regional structure composed of seven

74

REGIONAL

ORGANIZATION

OF T H E

SSA

regions (later reduced to s i x ) . In each case the regional representative of vocational rehabilitation w a s housed in a regional office of the Social Security B o a r d but not under the authority of the regional director. T h e regional attorney, h o w ever, performed legal services for the regional representative of vocational rehabilitation. A s an experiment one regional attorney also serviced a single F o o d and D r u g Administration region, traveling out of his B o a r d regional office. Certain special programs for the B o a r d ' s bureaus were also developed during the war. T h e bureau of public assistance w a s made responsible for the administration of civilian w a r assistance and assistance to enemy aliens and others affected by restrictive

governmental

action.

The

programs

were

istered by state public assistance agencies and were

adminfinanced

entirely by Federal funds granted by the bureau of public assistance. A s a result of the Serviceman's Readjustment A c t of 1944 the bureau of employment security w a s made responsible for helping to determine the proper administrative costs to be allotted to state unemployment compensation agencies for their w o r k in the payment of servicemen's readjustment allotments. N o changes in regional organization resulted f r o m these new programs of either the bureau of public assistance or the bureau of employment security. O f course the duties of their regional representatives were correspondingly increased. T h e pressure of wartime activities did result in regional changes

involving

the

increased

decentralization

of

Board

activities both in the sense of the physical location of activities in the field and in the placement of final action in the field. Beginning in 1942 final determination of many business and personnel matters formerly carried out in the executive director's office in W a s h i n g t o n were placed in the regional offices. In 1942, because of the congestion in W a s h i n g t o n , the bureau of old age and survivors insurance w a s forced by the Bureau of the Budget and the House Appropriations Committee to m o v e its claims control division out of Washington.

The

bureau

THE

EVOLUTION

OF SSA

ORGANIZATION

75

established five and then six area offices in key cities, each of which carried out for its own area the activities of review and adjudication of claims, accounting and control of claims in payment status, recovery and adjustment of claims, and certification of claims to the Treasury for payment. T h e remaining central activities of the bureau of old age and survivors insurance were moved to Baltimore, where its accounting operations division was already housed. One other regional change should be noted. E a r l y in the war the Board combined its Regions I and I I I establishing regional headquarters in New Y o r k and abolishing Philadelphia as a regional center. POST W A R

PERIOD

T H E BOARD

Just as the Agency and the Board experienced reorganization during the war, so the end of the war brought more reorganization, some of it long overdue. In September 1945 the President, acting under his war powers, abolished the W a r Manpower Commission by executive order and transferred the employment service, still nationalized, to the Department of Labor. The old struggle over the location of the employment service between a Department of Labor, seeking to be in a position to manage the labor market, and the Social Security Board was renewed. On November 1 5 , 1946, the employment service, still in the Department of Labor, was returned to its federal-state grant basis of administration, and the old federal-state budget complications with the Board's administration of grants for the state administration of unemployment compensation reappeared, this time with the new S S A acting in place of the Board. The President's Reorganization Plan I I of 1947 proposed the permanent location of the employment service in the Department of Labor, but it was rejected by the Congress. B y the end of 1947 the problem of the location of the employment service had not been solved. 23 23 On January 19, 1948, under the provisions of the Reorganization Act of 1945, the President recommended unsuccessfully to Congress the location

76

REGIONAL

ORGANIZATION

OF T H E

SSA

In 1946 a title X I I I was added to the Social Security Act to provide for the payment of reconversion unemployment benefits to seamen of the Federal maritime service to be administered by the states in accordance with their unemployment compensation laws. The Federal government was to pay for both the benefits and the cost of administration. The Federal government was empowered to administer direct payments to servicemen should a state decline to undertake the task, an eventuality which did not occur. The administration of title I I I was assigned by the Federal Security Administrator to the bureau of employment security. No reorganization of this bureau centrally or on the regional level was necessary in order to take on the new responsibility. Finally, it should be noted that it was not until July 8, 1947 that Congress made an appropriation for the start of the program of reconversion payments to seamen of the Federal maritime service. T H E BOARD AND T H E A G E N C Y

The general Federal reorganization of 1946 caused significant changes in the organization of the Agency and the Board, laying the groundwork both for the better internal organization of the Agency and the eventual establishment of Agency of both the employment service and the unemployment compensation functions under a Commissioner of Social Security in the Department of Labor. In appropriating for 1948-49, Congress returned the employment service to the bureau of employment security of the Social Security Administration. In accordance with the proposals of the Hoover Commission, the President recommended in Reorganization Plan I I of June 20, 1949 that the bureau of employment security be transferred to the Department of Labor. The proposal became effective on August 19, 1949. See The Commission on Organization of the Executive Branch of the Government, Department of Labor, A Report to the Congress (Washington: Government Printing Office, March, 1949), pp. 1, 2, 8, 9, 1 1 - 1 4 . Commission on Organization of the Executive Branch of the Government, Social Security; Education; Indian Affairs—A Report to Congress (Washington: Government Printing Office, March, 1949), pp. 3-9, 39. House of Representatives, Doc. No. 223, 81st Cong., 1st Sess. (Washington: Government Printing Office, June 20, 1949).

THE

EVOLUTION

O F SSA

ORGANIZATION

77

regional organization. Reorganization Plan II, which became effective July 16, 1946, abolished the Social Security Board and transferred its functions to the Federal Security Administrator. Thus the mechanics of reorganization made clear the complete authority of the Administrator over the old Board functions. The same plan transferred the children's bureau, with the exception of its industrial division, from the Department of Labor to the Federal Security Agency. 2 4 On July 16, 1946, the Federal Security Administrator created the Social Security Administration, headed by a Commissioner of Social Security, and assigned to the S S A all of the duties, powers, and functions of the old Social Security Board, the Secretary of Labor and the chief of the children's bureau. The new S S A maintained the same administrative organization during 1946-47 as that of the old Social Security Board except that the old executive director's office became the Office of the Commissioner of Social Security, and the children's bureau was added to the " operating" bureaus. Unlike the other program bureaus of the S S A , however, the children's bureau maintained its own services for state auditing and personnel standard work, and had two regional set-ups, one for its division of health services, and one for its social service division. T h e social service division of the children's bureau administered grants to states for strengthening public child welfare services in predominantly rural areas for homeless, dependent, neglected children and children in danger of becoming delinquent. In the S S A regional offices the division was represented by a regional welfare consultant who was technically responsible to his division and administratively responsible to the regional director of the S S A . The division of health services of the children's bureau administered grants to states for services to crippled children and for maternal and child health services in rural areas and areas suffering from economic distress. T h e 24 House of Representatives, Doc. No. 595, 79th Cong., 2nd (Washington: Government Printing Office, 1946).

Session

78

REGIONAL ORGANIZATION

OF T H E

SSA

division also administered through the states the wartime emergency maternity and infant care program for the wives and babies of aviation cadets and of men in the armed forces in the four lowest pay grades. On the regional level, the division of health services was represented by a regional medical director and his staff. H e too was administratively responsible to the regional director and technically responsible to his bureau. Since the division of health services had but eight regions when it was in the Department of Labor, it was possible only to correlate its regions with those of the S S A . Moreover, the regional headquarters for the division's southwest region was Dallas, Texas, instead of the S S A ' s San Antonio. T H E AGENCY

In addition to the children's bureau, Reorganization Plan I I of 1946 transferred to the Federal Security Administrator the duties of the United States Employees Compensation Commission and those of the division of vital statistics of the Bureau of the Census. T h e Agency was then organized into four operating branches as follows: the Social Security Administration as has been indicated, under a Commissioner of Social Security; Education, under a Commissioner and composed of the old Office of Education, the American Printing House for the Blind, the Columbia Institution for the Deaf and H o w a r d University; Health and Medical Care under the direction of the Surgeon General and composed of the Public Health Service, Freedmen's Hospital and Saint Elizabeth's Hospital; and the Office of Special Services, also under a Commissioner and composed of the Food and D r u g Administration, the Bureau of E m ployees Compensation, the Office of Community W a r Services, the Office of W a r Property Distribution, the Office of V o cational Rehabilitation and the Employees Compensation A p peals Board. 2 8 25 Agency Order No. 3, Organization of the Federal Security Agency (Washington, D. C.: Federal Security Agency, July 16, 1946). (Processed.)

THE

EVOLUTION

OF SSA O R G A N I Z A T I O N

79

T h e 1946 reorganization resulted in the formation of t w o new important A g e n c y central staff units. T h e office of interagency and international relations w a s created to form and guide policy in the establishment and coordination of relationships with other Federal agencies and international agencies, w i t h representatives of foreign governments and with organized groups in the fields of w o r k encompassed by the Federal Security A g e n c y . T h e office of federal-state relations of the A g e n c y w a s created as a result of the specific direction of section 10 of Reorganization Plan I I of 1942. It w a s given the j o b in all A g e n c y grant programs of establishing uniform requirements of the states for fiscal, personnel and business management matters. In this w a y it w a s hoped that a state would be subject to only one set of A g e n c y fiscal, personnel and business management standards, one audit, one personnel review and one administrative review rather than to different and often conflicting standards and reviews for each grant p r o g r a m in the A g e n c y . T h e accomplishment of such objectives would have certainly smoothed the w o r k being carried out on the regional level with the states. D u r i n g 1946-47 the Federal Security A g e n c y began to consider the development of an A g e n c y regional organization, and a committee was appointed to analyze the possibilities.

The

committee's report of M a y 1947 did not attempt to propose a single formula for the establishment of A g e n c y regional organization but w a s exploratory in nature. T h e committee did state its o w n preferences a m o n g alternative regional structures. T h e study made clear that a fruitful regional organization of the F S A could be established a m o n g those constituents of the A g e n c y which were concerned with federal-state grant matters. These included the bureau of state services of the Public Health Service, the Office of Vocational Rehabilitation, the Office of Education, and all of the S S A except the bureau of old age and survivors insurance. T h e report showed that it w a s possible to establish identical regional and identical headquarters cities for

80

REGIONAL ORGANIZATION

OF T H E

SSA

all of these activities, without administrative inconvenience to any one program. The advantages to be gained from such regional organization were to be, first of all, convenience to state officers and agencies in matters of travel, negotiation and standards. Second, fiscal, personnel, administrative and business requirements made of the states by the different Agency constituents might be standardized. Third, savings as well as the standardization of requirements might be effected if all of the Agency grant programs were serviced from a regional level by single, consolidated auditing personnel or legal units rather than by allowing each program to equip itself with auditors and personnel consultants. Fourth, regional offices might serve as points of coordination for new or emergency Agency-wide programs. Lastly, it was pointed out that considerable savings were possible through joint housing and the joint use of administrative services. The survey committee noted that for these purposes the directly operating bureau of old age and survivors insurance could be housed in the proposed regional offices with no inconvenience to that bureau. Moreover, the directly operating Food and Drug Administration could correlate its three regions with an Agency-wide regional system and could use three of the Agency regional headquarters as its own. In the case of both the bureau of old age and survivors insurance and the Food and Drug Administration, there would be savings not only in regard to administrative services and housing but also in regard to legal services. The survey committee proposed in its report that the Agency's regional officer should be only a convener without line authority of any kind. He might also be an office manager, but should not provide services which could involve staff controls. A central staff unit to the Administrator was to carry on planning and coordination at the center which would be a basis for the action of the regional convener and his committee of Agency constituents. 26 26 Dean Snyder, et at., op. cit.,

passim.

THE

EVOLUTION

OF SSA O R G A N I Z A T I O N

8L

C O M M E N T S ON T H E O R G A N I Z A T I O N A L D E V E L O P M E N T S OF T H E SSA

AND T H E F E D E R A L S E C U R I T Y A G E N C Y ,

1939-1947

T H E SSA

Certain comments are appropriate here by way of clarification and interpretation of Board, S S A and Agency organizaton since 1939. On the whole, those aspects of the organizational history of the Board and the S S A which were significant for regional organization are analyzed in detail later in this volume. 27 The abolishment of the Board and the establishment of a single Commissioner of Social Security in 1946 had no effect upon regional administration. The Chairman of the Board had long since emerged as the de facto administrator. The executive director had become a kind of chief of staff service for the Board's Chairman. With the abolishment of the Board, the position of the executive director was terminated, and the office of the executive director became the Office of the Commissioner of Social Security and was run by a Deputy Commissioner who was also authorized to act for the Commissioner in his absence. The placement of the children's bureau in the S S A in 1946 increased the regional operating relations within the S S A for the bureau of public assistance and the children's bureau. Both administered programs concerned with child welfare, and both dealt most often with the same state agencies.28 On the other hand the continued existence of the employment service in the Department of Labor hampered the operating relations of the 27 For example, the movement of activities from the bureaus of research and statistics and accounts and audits to the bureaus of employment security and public assistance, as well as the increase of the responsibilities of the regional attorney, and the abolishment of the position of regional research representative are all discussed in chapter seven in regard to the difficulties of functionalization. 28 The federal-state health programs of the children's bureau were related to those of the Public Health Service and here again the same state agency was the client of two federal organizations.

82

REGIONAL

SSA

ORGANIZATION

OF T H E

SSA

regional offices, for in 1947, as before 1939, the t w o

agencies w e r e dealing with states on matters of budgets, grants and requirements f o r state employment services and f o r state unemployment compensation organizations. Either the S S A or the Department of L a b o r alone could h a v e done the t w o jobs more effectively and economically. A s a matter of fact, three Federal agencies were

involved

in the business of

making

grants to state employment security agencies for their administrative costs. T h e V e t e r a n s A d m i n i s t r a t i o n granted states the cost incurred by their state unemployment compensation agencies in administering veterans readjustment allotments. 2 9 T h e children's bureau came into the S S A w i t h a g o o d deal of determination to retain its o w n entity, to remain the representative of the voteless child in administration. 3 0 E x c e p t for legal services the children's bureau continued through 1947 a self-contained unit as far as its specialized services were concerned. It had its o w n audits unit to carry out state audits and its o w n merit system unit to administer personnel w o r k with the states. Neither of these small units w a s able to provide, especially in the field, services comparable to those offered by the S S A ' s bureau of accounts and audits and by the

SSA's

state technical advisory service. In 1947 the audits unit of the children's bureau had a considerable backlog of w o r k . It turned out that it w a s fortunate that the children's bureau w a s able to h a n g on to its division of reports w h i c h w a s responsible for information and publications, for the S S A ' s informational service, with which the division of reports w a s nearly combined, w a s abolished by C o n g r e s s in appropriating for 1947-48. 29 There is no attempt made here to note the many arguments for and against the location of the administration of unemployment compensation and the employment service in the Department of Labor or the S S A . 30 Of course, under Reorganization Plan II of 1946 all activities of the children's bureau with the exception of its industrial division were transferred to the Federal Security Administrator who theoretically could have organized them as he saw fit.

THE

EVOLUTION

OF SSA O R G A N I Z A T I O N

83

T H E FEDERAL SECURITY A G E N C Y

A l t h o u g h the Federal

Security A g e n c y w a s organized

in

1939, it w a s not until 1946 that the A g e n c y began to develop a closely knit organization under the Federal Security A d m i n istrator, a process w h i c h w a s still under w a y in 1947. D u r i n g the period of this study, the A g e n c y did not attempt regional or field activities and had no effect on the regional w o r k of its constituents. O f course, d u r i n g the w a r period the

regional

directors of the S S A served as the regional directors of C o m munity W a r Services and its antecedents. In this capacity they were responsible for coordinating the field activities of m a n y A g e n c y constituents. T h e w o r k of the S S A regional directors for C o m m u n i t y W a r Services w a s terminated in 1945 and n o Agency

regional

activity

or

office of

any

kind

developed

through 1947. It w a s apparent by 1 9 4 6 that there w a s much duplication of certain c o m m o n specialties within the A g e n c y by constituents concerned w i t h the administration of federal grants-in-aid. Y e t , each A g e n c y constituent administering g r a n t s maintained its own staffs for state personnel, informational, and auditing and accounting w o r k . Agency

Only

for all A g e n c y

legal

services were supplied by

organizations.

The

Social

the

Security

Board developed a strong merit system personnel unit in the state technical advisory service, yet the Public Health Service and other constituents developed their o w n merit

personnel

organizations at increased cost. Since these common specialties of different A g e n c y organizations were enforcing requirements made of the states, m a n y conflicting and duplicating demands were made of state agencies. W h i l e it is true that during the period of this study, the Federal Security A g e n c y had little influence on its constituents and none on their regional or field activities, it w a s clear f r o m

84

R E G I O N A L O R G A N I Z A T I O N OF T H E SSA

many events by the end of 1 9 4 7 that the situation would soon be changed. 3 1 These events m a y be reviewed.

Reorganization

31 In the late spring of 1948 (after the cut-off date of this volume), all auditing and all personnel merit system work with state agencies was transferred from those constituents of the Agency dealing with federal-state administration to the Agency's office of federal-state relations. By this move the office of federal-state relations was changed from a staff unit responsible for the standardization of audit, accounting, and personnel procedures required of state agencies to an operating organization, actually doing the work of fiscal and personnel supervision of state agencies for Agency constituents responsible for grants to states. See Agency Order 5, Office of Federal-State Relations (Washington, D. C.: June 21, 1948). (Processed.) When the state audit duties were transferred to the Agency's office of federal-state relations, the SSA's bureau of accounts and audits was abolished. Its internal accounting duties were given to the program bureaus. The transfer of state merit personnel work to the office of federal-state relations resulted in the abolishment of the SSA's state technical advisory service. The sole remaining functional bureau of the SSA, the bureau of research and statistics, was reduced to a division and placed in the Office of the Commissioner of Social Security. This Office was in turn shorn of most of its activities; its business and management duties were transferred to the Agency level; its state technical advisory service was abolished; and its field activities in July of 1948 were lost to a new Agency field division. The Commissioner's Office came to be composed of a few aides and the division of bureau and research. By the end of July 1948 the SSA was composed of only its old four line bureaus plus the bureau of federal credit unions, transferred to the Federal Security Agency from the Federal Deposit Insurance Corporation on July 29, 1948 by Public Law 813, 80th Cong., 2nd Sess. All of the activities of the old functional bureaus were now on the Agency level. As indicated in n. 23 supra on August 19, 1949, the SSA lost the bureau of employment security to the Department of Labor. The SSA was then composed of only three program bureaus. On July i, 1948, in accordance with the Supplemental Federal Security Agency Appropriations Act of 1949 (Public Law 646, 80th Cong., 2nd Sess.), the Agency established its own ten-region system with ten regional headquarters. See Federal Security Agency Order 16, Agency Field Organization-Regional Boundaries (Washington, D. C.: Federal Security Agency, July 30, 1948). (Processed.) By April of 1949 the regional headquarters and regions incorporated the regional activities o f : the Office of Vocational Rehabilitation; the bureaus of the SSA including the children's bureau, the bureau of employment security (by then composed of both unemployment compensation and employment service activities and soon to be transferred to the Department of Labor), the bureau of public assistance, the

THE

EVOLUTION

OF

SSA

ORGANIZATION

85

Plan II of 1946 had helped clarify lines of authority since it had abolished the " policy determining " Social Security Board bureau of old age and survivors insurance, and the bureau of federal credit unions; and the bureau of state services of the Public Health Service. It will be noted that the Office of Education still successfully resisted decentralization. T h e regional auditors and personnel methods consultants of the office of federal-state relations and the regional attorney of the office of the general counsel were also located in the regional offices. A l l of the activities which operated out of the A g e n c y regional offices involved federalstate programs except for t w o bureaus. The A g e n c y regional offices were headed by a regional director who provided " leadership, coordination, evaluation and general administrative supervision " of bureau representatives in his region and operating out of his headquarters. T h e regional director was also responsible for the provision of administrative services; for intra-governmental and intra-Agency program coordination; for control of travel, working hours, state contacts, and program priorities within his region; and for general public relations. Under the general administrative supervision of the regional director, the regional representatives were to be responsible " for the program operations and technical services of the bureaus." See Federal Security Agency Order 16-1, Agency Field Organisation-Regional Directors (Washington, D. C . : Federal Security Agency, July 30, 1948). (Processed.) T h e regional director of the S S A was abolished and his functions were transferred to the new regional director of the Agency, but the district officer of the Public Health Service's bureau of state services was kept to give immediate supervision to his staff of approximately forty persons. A regional social security officer, selected by and from S S A representatives in each region, was made responsible for attending to S S A matters referred to him by the regional director or the Commissioner of Social Security, and for coordination between S S A representatives and between them and the A g e n c y functional representatives. The Federal Security Agency did not place the field activities of the Food and D r u g Administration, or of the bureau of employees compensation or those of the Public Health Service's bureau of medical services directly under the new A g e n c y regional directors. None of the field officers of these constituents were housed in the A g e n c y regional headquarters. ( T h e three regional headquarters of the Food and D r u g Administration were in the same cities as three of the Agency's regional headquarters.) But the regional director was given the authority to subject those field activities in his region, but not operating out of his office, to general review and consultation on public relations and inter-governmental relations, and to request information and reports on their activities on his own initiative. See Agency Order 16-1, p. 2. A n A g e n c y division of field services was also established in July of 1948. Its functions were extensive and included: the development of policy and planning for field coordination; inter-governmental and intra-agency liaison work in the interests of field coordination; the control of adminis-

86

REGIONAL

ORGANIZATION

OF T H E

SSA

and had transferred its functions to the Federal Security A d ministrator. Reorganization Plan II had also served to clarify the authority of the A g e n c y over its constituents because the P l a n had transferred all activities with which it w a s concerned to the A d m i n i s t r a t o r w h o in turn w a s to determine their organization within the A g e n c y . T h e new office of federal-state relations of the A g e n c y had been created in accordance w i t h trative, business and personnel management matters of the regional offices; the review for Agency policy of instructional material flowing to the field; the development of field reporting to the Administrator and of overall communications to the field; and the preparation of regional directors conferences. See Federal Security Agency Order 16-2, Agency Field Organisation, Division of Field Services (Washington, D. C . : Federal Security Agency, July 30, 1948). (Processed.) The overall S S A field division was abolished. Both the Hoover Commission and the President recommended departmental status for the Federal Security Agency, but the Senate turned down Reorganization Plan I of 1949 in which the President proposed a Department of Welfare. Departmental status would have probably no effect on the 1949 regional organization of the Federal Security Administration. The Hoover Commission recommended that the Federal Security Agency should gain the bureau of Indian A f f a i r s and that it should lose the Public Health Service to a proposed United Medical Administration; the Food and D r u g Administration to the Department of Agriculture; and the employees compensation appeals board, the bureau of employees compensation, and the bureau of employment security to the Department of Labor. The Commission also recommended that an integrated approach to grants-in-aid be developed in this proposed department of welfare and that the children's bureau then be placed in a staff capacity since this bureau's program cut across health, welfare and education activities. The President recommended departmental status for the Federal Security Agency, but the transfer of only the bureau of employment security. T h e latter recommendation was approved by Congress. Should the Hoover Commission's proposals ever be adopted, there would be considerable change in the central and regional organization of the Federal Security Agency. See Commission on Organization of the Executive Branch of the Government, Social Security; Education; Indian Affairs, passim. See also House of Representatives, Doc. No. 222, 81st Cong., 1st Sess. (Washington: Government Printing Office, June 20, 1949), House of Representatives, Doc. 223, 81st Cong., 1st Sess., op. cit., passim. In 1949 a regional field representative of the surplus property utilization program, Office of Education, and a basin engineer of the bureau of state services of the Public Health Service were added to the Agency regional offices.

THE

EVOLUTION

OF SSA O R G A N I Z A T I O N

87

Reorganization Plan I I of 1946 to effect a standardization of the fiscal, business management, and personnel requirements imposed on states by the various Agency constituents administering federal-state programs. A n Agency committee to survey the possibilities of Agency-wide field coordination had pointed out in the spring of 1947 that consolidated regions and identical regional headquarters were possible for constituents concerned with federal-state programs. T h e committee had also noted the advantages to be gained from A g e n c y regional organization in consolidating common specialties, in customer convenience, in housekeeping savings, and in Agency-wide coordination, especially with regard to new activities. It w a s clear by the end of 1947 that S S A regional organization would soon operate within the larger framework of A g e n c y regional organization. There were possibilities, too, for a more efficient regionalization of the S S A within an Agency-wide regional organization.

CHAPTER IV THE ORGANIZATION AND THE ACTIVITIES OF THE REGIONAL OFFICES T H E nature of the w o r k which w a s carried out on the regional level perhaps can be understood best by a description of the composition and duties of the regional offices during one p e r i o d — 1 9 4 6 - 4 7 . T h i s survey will provide a background for the later discussion of the difficulties involved in the delineation of area, the definition of command, and other problems of multi-program, functionalized decentralization. C E N T R A L ORGANIZATION OF T H E

SSA

B y w a y of recapitulation it should be noted that the central organization and operation of the S S A in 1946-47 w a s almost completely unaffected by the parent organization, the Federal Security A g e n c y . T h e S S A included four " operating " or prog r a m bureaus, four " service " or functional bureaus ( w i t h a fifth on the A g e n c y level), the Office of the Commissioner of Social Security, the office of the actuary and the appeals council. T h e four program bureaus were old age and survivors insurance, public assistance, employment security, and the children's bureau. T h e functional bureaus were research and statistics, accounts and audits, and the informational service. In addition, the office of the general counsel on the A g e n c y level serviced the S S A ' s program bureaus. T h e total field staff of the office of the general counsel consisted of regional attorneys located in the regional offices of the S S A . These regional attorneys serviced only the S S A regional and field activities and those of the regional representatives of vocational rehabilitation (also housed in the S S A

regional office). T h e r e w a s in reality one more

functional bureau of the S S A — t h e

state technical

advisory

s e r v i c e — w h i c h w a s located in the Office of the Commissioner 88

REGIONAL

OFFICES

89

of Social Security instead of h a v i n g independent status as in the case of its counterparts. O n the whole the Office of the Commissioner w a s equipped to c a r r y out the w o r k of business management and of assisting the Commissioner in the j o b s of operative planning, o r g a n izing, commanding, coordinating, and controlling. These last five duties were carried out by the coordination and review division of the Office of the Commissioner. Business management w a s the w o r k of an office of personnel and

business

management. T h e Office of the Commissioner also included a training division and a field operations division. T h e latter w a s a staff aid to the Commissioner in his dealings with regional directors and controlled centrally many of the business services w h i c h the regional offices afforded the bureau representatives. T h e field division coordinated field communications, planned annual conferences of regional directors and at one time cleared all field contacts. O f course each of the S S A bureaus had its o w n field division, section, or unit which carried out its o w n field coordination, communication, and control activities. R E G I O N A L O R G A N I Z A T I O N OF T H E

SSA

In 1946-47 each regional headquarters office of the S S A contained the f o l l o w i n g : the regional director, his executive assistant, and services for housekeeping and personnel purposes; the regional representatives of the three " operating " bureaus of old age and survivors insurance, public assistance, and employment security and the regional representatives of the t w o " operating " divisions of the children's bureau, which were the division of health services and the social service division; the four regional representatives of four of the five " service " or functional bureaus, which were the state technical service, the general counsel, the informational

service, 1

advisory and ac-

1 T h e informational service was abolished by congressional appropriations for 1948. T h e bureau of research and statistics had no regional representatives after 1941.

90

REGIONAL

ORGANIZATION

OF T H E

SSA

REGIONAL

OFFICES

91

counts and audits; and the independent regional referee of the appeals council. In addition, there w a s a representative of the Office of Vocational Rehabilitation in seven of the regional offices, but he had no responsibility to the regional director o r to the Commissioner of Social Security. H e w a s placed in the regional office for housing convenience o n l y ; however, he w a s serviced on legal matters by the regional attorney. A f t e r the regional offices were first established in 1936, their composition changed in seven principal ways. First of all, up to 1941 there w a s a regional representative of the bureau of research and statistics. In that year the position w a s abolished, but a regional research consultant w a s added to the staff of the public assistance representative and, presumably, one

would

have been added to the staff of the employment security representative if the employment service function had not been transferred to the W a r M a n p o w e r Commission shortly thereafter. T h e move, in general, resulted f r o m the drive on the part of the operating bureaus to obtain self-sufficiency and f r o m the realization that operating research and statistics had to be tied closely to operations. M o r e o v e r , the scope of special k n o w l e d g e needed to do research for the t w o p r o g r a m s of public assistance and employment security w a s too broad for any one regional research representative to encompass. S o far as the basic creative w o r k of research and statistics w a s concerned, it became clear that this had to be done centrally by the collective e f f o r t s of research people. 2 Second, after the amendments of 1939, regional referees were added to the regional offices as representatives of the appeals council. T h i r d , as noted in chapter three and discussed later in this chapter, in 1942 m a n y business activities and in

1944 m a n y personnel functions,

both

formerly executed centrally, were decentralized to the regional office. T h e w a r brought m a n y changes in the operation of the regional offices. T h e fourth m a j o r change, therefore, involved the 2 See supra, pp. 70-71.

92

REGIONAL

ORGANIZATION

OF T H E

SSA

wartime activities of the regional representative of employment security. In 1939. of course, the employment service was located in the Social Security Board and the regional representative of employment security administered both the unemployment compensation and employment service programs. In 1941 at the beginning of the defense period, the regional employment security representative was made the regional labor supply officer for defense programs and was given an associate regional representative to take over the unemployment compensation activities. In 1942 the employment service was first nationalized and then transferred to the W a r Manpower Commission. A s already recounted, many things happened to the employment service after that time, but by the end of 1947 it had not been returned to the Federal Security Agency or the S S A . 3 During 1946-47, then, the regional representative of employment security was responsible only for unemployment compensation. The fifth major change in regional activities resulted when the regional directors of the Social Security Board became in addition the regional directors for Community War Services (and its antecedents). These duties of the regional director, of course, stopped with the abolishment of Community War Services at the end of war. A sixth change was the decentralization of business management functions to the regional office, which was caused by the impact of increased wartime activities but continued as a permanent arrangement. Seventh and last on December 1, 1946, as a result of Reorganization Plan I I of July 1946, the regional child welfare consultants of the social service division and the regional medical director and his staff of the division of health services, all of the children's bureau, were added to the regional offices of the SSA.4 3 See chapter iii, supra, pp. 72-74, and n. 23, pp. 75-76. 4 Memorandum of Arthur J. Altmeyer to Chief, Children's Bureau and all Regional Directors, " Consolidation of Regional Staffs of the Children's Bureau with Social Security Administration Regional Offices," Nov. 5, 1946. (Typewritten.)

REGIONAL REGIONAL

OFFICES

93

ACTIVITIES

REGIONAL DIRECTOR

The duties and authority of the regional director are fully discussed in chapters six, seven, and ten and need be described here only in terms of the overall regional picture. In brief, then, the regional director was responsible to the Commissioner f o r the general supervision of the regional offices, for the coordination of bureau activities and for the provision of housekeeping services. H e was also the representative of the Commissioner in his region and in this sense controlled public relations and federal-state relations. H e had the power to recommend the appointment of regional representatives to the respective bureau heads, to state his opinion and recommendation to the Commissioner with regard to any such appointment, and to submit a statement to the Commissioner as to the efficiency or suitability for continued assignment to his region of a bureau representative or employee. H e was the final appointing officer of all personnel in his region, including those of the area offices, up to and including grades P - i and C A F - 6 or their equivalent. EXECUTIVE ASSISTANT

T h e executive assistant was authorized to assist the regional director generally in all of his duties, to act for him, and to assume especially the burden of supervising business management. 5 The executive assistant supervised the clearances and coordination of " operating " and " service " bureaus in their relations with the states. H e did the staff w o r k ; briefed the regional director on matters of detail; and served as a follow-up person in all matters involving the relations of the S S A representatives with the states, with other constituents of the Agency, or with other Federal departments. T h e executive assistant acted for the regional director in his absence. H e played a genuine staff role; but the use made of him by the regional director varied from region to region. 5 Cf. Social Security Board, Temporary Field Manual (Washington, D. C.: The Social Security Board, May 12, 1936). (Processed.)

94

REGIONAL

ORGANIZATION

BUSINESS

OF T H E

SSA

MANAGEMENT

The regional office budget provided for office space, secretarial and clerical services, communication services, and general office housekeeping services. T h e regional representatives and their staffs, other than secretarial personnel, were carried on bureau budgets. Housekeeping services in the regional offices were headed by a chief clerk. They included a stenographic pool; central files kept on the Dewey decimal system; general services such as mail, messenger service, and the like; and payroll, personnel, accounting and allotment work. There was also a correspondence clerk who served as a clearance point for all incoming and outgoing correspondence, instructions and manuals, in order to control routing and to police routine clearances. M a n y of the business and personnel activities which were finally decentralized to the regional offices were placed there at first only because of the impact of the war. Before 1 9 4 2 all travel orders were authorized in Washington, all vouchers audited there, all payrolls made up there and all checks sent from there. The regional director had no appointing authority except for temporary appointments and for the business staff of his regional office. In all other cases he had only the power to recommend. Pushed by the w a r and the decentralization of business activities on the part of Community W a r Services and the Office of Production Management, with which the Board was cooperating, the Board after 1 9 4 2 began to allocate final business action to the field in many matters. Thus, communication allotments were made to the regional office for the entire region, and the regional office was made responsible for establishing the necessary controls. T h e practice of allowing the individual bureaus to make the travel allotments for their regional representatives continued, but the regional office was given the responsibility of making up travel orders, of posting encumbrances, and of clearing and reporting all travel, including that of the field offices.

REGIONAL

OFFICES

95

A f t e r 1 9 4 4 the personnel unit of the regional office, under authority granted the regional director, kept personnel files for all appointments and promotions within the region (including area and field offices) f o r positions up to C A F - 7 or P - 2 or their equivalent, journalized all such appointments and maintained the personnel folders, and recruited f o r all such positions e x cept in the case of area offices. A f t e r 1 9 4 4 for all personnel in the region, the regional office kept the time and leave records, made up the payroll and certified it to a regional T r e a s u r y office. T h e regional director could not take personnel actions involving field office managers, regardless of their grade, nor could he make certain types of separations, demotions f o r cause or promotions, although after J u l y 1 9 4 6 he w a s authorized to certify all administrative raises. 6 T h e regional director maintained his power to recommend the appointment of the regional representatives and to approve all other appointments. D u r i n g the w a r an administrative audit clerk w a s also placed in the regional office and attached to the staff of the regional auditor. T h i s person w a s responsible f o r audits of all payrolls, travel vouchers and other vouchers, which w e r e paid regionally in most S S A regions by the T r e a s u r y without going to W a s h ington. A f t e r 1 9 4 2 the chief clerk of the regional office accepted bids on standard items f o r purchases not in stock. Non-standard items had t o be approved f r o m W a s h i n g t o n . T h e chief clerk w a s also allowed to issue bills of lading f o r persons w h o changed residence upon S S A order and at Government expense. Comment

on the Business

Management

the Regional

Services

of

Offices

It w a s seriously suggested at the regional directors' conference in 1 9 4 6 that there should be a regional budget f o r the staff's of the bureaus and services on the regional level as well as the existing one f o r the housekeeping staff of the regional 6 Social Security Board, Administrative Order No. 5 (Washington, D. C.: Federal Security Agency, 1944). (Processed.)

g6

REGIONAL

ORGANIZATION

OF T H E

SSA

office. Exclusive of the authority relations involved, it perhaps would have been desirable at least to have region-wide accounts and allotment systems and to have budgetary consideration of the substantive work of the region on an overall regional basis. Besides the convenience of the first to the regional representatives, the latter would have provided a basis for considering the advisability of intra-regional transfer of funds as against the intra-bureau transfer to Washington or to some other area. Final authority need not have been given to the regional director in such matters. It has been noted that the regional office handled the payroll and certain personnel functions for the area offices of the claims control division of the bureau of old age and survivors insurance. However, the area offices and the regional offices were nowhere housed together even though they were located, except in two instances, in the same cities. It would have been possible to provide common housing for the area and regional offices and to unify more of their business services. 7 In 1947 only the area offices in Philadelphia and Birmingham were not in a city where there was also a regional office. According to the criteria for locating area offices, there was apparently no reason why the Philadelphia office could not have been moved to New Y o r k and the Birmingham office to Atlanta. If such shifts had been made, all regional offices and area offices could have been housed together with consequent savings. Since the regional attorney serviced area offices and since both the regional referee and the regional representative of old age and survivors insurance had relations with the area offices, the common location and housing of area and regional offices would have resulted in savings in travel. Lastly, some attempt should have been made on the part of the S S A to make use of one of the warehouses and supply centers of the bureau of federal supply of the Treasury except, 7 Quite to the contrary, in 1949 the area offices received responsibility for personnel actions formerly carried out by the Federal Security Agency regional offices.

REGIONAL OFFICES

97

perhaps, for storing and supplying forms. The system of sending supplies other than forms out of Washington was both cumbersome and wasteful. Possibly the Treasury centers could have handled most of the 1,500 forms of the S S A if stock levels and the matter of new supplies of forms had been controlled by the S S A . T H E REGIONAL

REPRESENTATIVES

" Operating"

Bureaus

The regional representative of the bureau of old age and survivors insurance, with a staff of three or four assistant regional representatives and a continuity clerk, was responsible for the supervision, guidance and training of field offices within his region. Usually field offices were visited every three months. These offices were responsible for educating employees and employers as to their responsibilities and benefits under the Act, for the assignment of account numbers to workers, for policing the proper reporting of taxes and other matters related to keeping accurate wage records, and for the routine and simple adjudication of claims. The regional representative and his staff supervised field office performance in these matters. Besides visits to field offices, the following actions were carried out by the regional representative in executing supervision and control: ( 1 ) T h e testing of proposed procedures and the teaching of new procedures. ( 2 ) T h e reviewing of work reports, operating programs and reports. ( 3 ) T h e assigning of positions in field offices, but under tight central staffing and work-load standards, and regional personnel ceilings. ( 4 ) T h e running of training programs and intra-regional conferences, devoted largely to instruction and training.

98

REGIONAL

ORGANIZATION

OF T H E

SSA

( 5 ) The maintaining of business controls and the providing of business services, such as the approval of requisitions, the provision of emergency stocks, space negotiations, travel allocations and travel orders. ( 6 ) The appointing and promoting of personnel up to C A F - 7 and P-2, with the exception of field office managers and assistant office managers (in the name of the regional director who had final authority). ( 7 ) The giving of efficiency ratings to field office managers. 8 It is to be noted that the regional representative had no control over the area offices of the claims control division in his region although their work was closely related to that of the field offices. The area offices, which were six in number, reviewed all field office claims determination, kept the records of claims in payment, handled difficult claims adjudication and all matters of recovery and adjustment, and certified payments to the Treasury. The regional representative for the public assistance program had a staff usually composed of an associate regional representative, an assistant regional representative, four field administrative analysts, one office administrative analyst, and a regional research consultant. It was the duty of the regional representative and his staff to advise state officers, to make initial determinations of and to make reports on and recommendations to Washington as to state plans, estimates, budgets, expenditure reports, audits, mandatory and suggested standards, and legislation. He kept a close watch on all state laws, proposed legislation, attorney general rulings, and court decisions in order to advise the states as to their effect on state plans and standards and on legal issues of conformity with federal legislative requirements. T h e latter duty was carried out with the assistance of the regional attorney. The regional representative also kept Washington informed about these matters. 8 Social Security Board, Organisation and Functional Chart, Social Security Board Regional Office (Washington, D. C . : Federal Security Agency, March 1, 1946). (Processed.)

REGIONAL

OFFICES

99

H e had the right to review the audit exceptions made by the regional auditor with regard to state assistance payments or administrative expenditures. When the regional public assistance representative and the regional auditor failed to agree on audit exceptions, the matter was referred to their bureaus in Washington and ultimately to the Commissioner. The public assistance regional representative reviewed expenditure reports together with the regional auditor. He also arranged for the use of Board consultants and specialists from Washington and was the channel to the state for the activities of the informational service representative and the personnel methods consultant. The associate representative assisted the public assistance regional representative in all his activities, including the supervision of the staff, and acted for him in his absence. The assistant regional representative was in charge of the administrative analysts, who made a continuing review of state administration of public assistance. The kernel of this administrative review 9 was a sample audit of public assistance cases. This audit served as a check on state performance and raised questions of disallowance, conformity issues, violations of state plans, and bad administrative practice. The regional public assistance research consultant was under the " general supervision and program leadership " of the regional representative, but under the " technical supervision " of the chief of the division of statistics and analysis. The words " program leadership " were added since it was felt that the term " general supervision " did not include this concept. The regional research consultant collected and supervised the collection of data flowing regularly to Washington on the content and nature of state public assistance programs; provided consultation and advice to the states on research programs; and aided in the budget and grant process by helping to install time 9 Temporarily abandoned while the administration of the amendments of 1946 was being established, but restored in a somewhat different fashion in 1949.

IOO

REGIONAL ORGANIZATION

OF T H E

SSA

and cost systems in state agencies and by advising the regional representative in regard to time and cost data. 1 0 The regional representative of employment security usually had an associate and an assistant. When the bureau of employment security included the employment service, the staff w a s larger and included one or two other assistant regional representatives, but these were lost at the time of the transfer of the employment service to the W a r Manpower Commission. T h e regional representative of employment security had the authority to advise state agencies, to make initial determinations and reports, and to make recommendations to Washington. H e kept close watch on state laws, proposed legislation, attorney general rulings, and court decisions and, with the regional attorney, advised states as to any resultant legal issues affecting conformity with the Social Security Act, and informed W a s h ington thereupon. He informed states of mandatory and suggested program and administrative standards, and he proposed model legislation to state officials and legislatures in order to improve unemployment compensation both as to substantive program and as to administration. He made initial determinations as to audit exceptions submitted by the regional auditor and informed Washington of his opinions. Together with his staff he also undertook an administrative review, which, un10 Cf. Social Security Board, Organizational and Functional Chart, Social Security Board Regional Office. Social Security Board, Administrative Order No. 2, Procedure for Handling State Plan Material Submitted for Approval Under Titles I, IV, and X of the Social Security Act (Washington, D. C . : Federal Security Agency, February, 1941). (Processed.) Social Security Board, Administrative Order No. 11, Organization of the Field Service (Washington, D. C . : Social Security Board, October io, 1937), pp. 5, 6. (Processed.) Social Security Board, Administrative Order No. 13, Procedure for Handling States' Estimates and Statements of Expenditure Covering Public Assistance and Authorizing Certification of Grants under Titles /, IV, and X of the Social Security Act (Washington, D. C . : Federal Security Agency, December, 1945). (Processed.) Social Security Board, Administrative Order No. 49, Submission and Approval of Fiscal Audit Reports of State Accounts and Records Pertaining to Public Assistance ( W a s h i n g ton, D. C . : Federal Security Agency, October, 1943). (Processed.) Since all of this material gets out of date rapidly, it was supplemented by interviews.

REGIONAL

OFFICES

IOI

like the public assistance review, was changed each year and was directed usually at improvement of administrative technique. This review furnished the concrete data on which the regional representative rendered advice to the state and undertook

the review

of

proposed

state budgets.

The

regional

employment security representative was also the channel for the relations of the " service " bureaus to the state agencies and for the state relations of specialists and consultants from Washington. T h e budget and grant role of the employment security representative was an important and complicated one because of the stringency of management and business standards resulting from the 100% administrative grant. Complexity was also added to the budget and grant process by the need to separate out the costs of administering the employment service and veterans readjustment allotments from the total administrative costs of state employment security agencies. 11 The regional child welfare consultants of the social service division of the children's bureau had the same regional areas and the same headquarters as those of the Social Security A d ministration, except that in one case the regional child welfare consultant did not stay at her headquarters city but covered her region from the place of her residence. The regional child Weil l Social Security Board, Organisation curity Board Regional

Office.

and Functional

No. ii, p. 9. Social Security Board, Administrative for Handling Proposed Program

Chart, Social

Social Security Board, Administrative

State Legislation

Order No. 3,

Affecting

SeOrder

Procedure

the Employment

Security

(Washington, D. C . : Federal Security Agency, January, 1944).

(Processed.) Social Security Board, Administrative for Handling

State Laws Submitted

IX of the Social Security

Act

for Approval

Order No. 4,

Procedure

by the Board under

Title

(Washington, D. C . : Social Security Board,

September, 1936). (Processed.) Social Security Board, Administrative der No. 20, Review

of State

ES

Law and Administration

Or-

and Reports

Submittal

ES

(Washington, D. C . : Federal Security Agency, Febru-

Administration

ary, 1944). (Processed.) ¿I, Submittal and Approval Pertaining

to Employment

to the Board of Budgets and Grants for

to

the Board Thereon.

Social Security Board, Administrative of Audit Reports of State Accounts Security

Administration

Order and

No.

Records

(Washington, D.

Federal Security Agency, September, 1943). (Processed.)

State

C.:

102

REGIONAL

ORGANIZATION

OF

THE

SSA

f a r e consultants w e r e e n g a g e d in m a k i n g plans j o i n t l y w i t h the states to strengthen a n d e x t e n d the w o r k of the states, especially in rural areas, f o r homeless, dependent, neglected children and children in d a n g e r of b e c o m i n g delinquent. 1 2 T h e

plans

w e r e w o r k e d out a n n u a l l y a n d w e r e in the nature of a contract since the Federal act p r o v i d e d f o r j o i n t a g r e e m e n t a n d since there w e r e few s t a n d a r d s in the act. T h e w o r k became in part demonstration w o r k . In a d d i t i o n t o the plans developed w i t h the states, the regional child w e l f a r e consultant w a s responsible for assembling certified plan m a t e r i a l ; f o r d r a w i n g u p the detailed line-item b u d g e t and q u a r t e r l y estimates of proposed e x penditures;

for

resolving

conformity

issues w i t h

the

state,

w h i c h w e r e few in this i n s t a n c e ; f o r r e v i e w i n g quarterly a n d annual financial reports a n d reports o n services r e n d e r e d ; a n d for p r o v i d i n g for the services t o the states of special

Wash-

ington consultants on illegitimacy, j u v e n i l e courts, delinquency, foster care, adoption, t r a i n i n g a n d m i n o r i t i e s . 1 3 T h e regional medical director of the d i v i s i o n of health services, children's bureau, had a staff c o m p o s e d of a n u r s i n g consultant, a medical social w o r k consultant, a n u t r i t i o n consultant, and an a d m i n i s t r a t i v e m e t h o d s consultant. T h e nutrition consultant w a s not present on o n e half of the regional s t a f f s , a n d there w a s n o a d m i n i s t r a t i v e

m e t h o d s consultant o n one re-

gional staff. T h e r e g i o n a l medical director a n d his staff had the same regions in 1 9 4 6 - 4 7 a s those of the S S A and the same headquarters cities except that the d i v i s i o n of health services used D a l l a s instead of S a n A n t o n i o . B u t there w e r e really only eight regional s t a f f s of the d i v i s i o n of health services, a n d three of these w e r e therefore responsible f o r t w o S S A r e g i o n s and regional headquarters. T h e regional medical director w a s responsible to the director of field operations of the d i v i s i o n of health services f o r administration of the r e g i o n a l staff of the d i v i s i o n of health serv12 This program was closely allied to that of the regional public assistance representative's work in aid to dependent children. 13 The National Archives, Federal Register, pp. 177A-536, 540.

REGIONAL

OFFICES

103

ices. The regional consultants were under the general administrative supervision of the regional medical director but were under the technical supervision of the various units of the program planning section of the division of health services. In this case the general command of the regional medical director was inclusive and based on the common professional training of the regional medical director (who was an M.D. and often was both a pediatrician and a specialist in public health) and of the regional consultants who were nurses, medical workers, and nutrition experts. Through training, the doctor had an adequate frame of reference for supervision, and from hospital and institutional experience, the regional consultants were accustomed to this supervision. The regional medical director and his staff were responsible for administration on the regional level of the maternal and child health program, the crippled children program, and the emergency maternity and infant care program, all of which were on a federal-state grant basis. For all of these programs, the regional medical director and his staff were responsible for the review of state plans, budgets, expenditure reports and reports of services rendered. The review and negotiation with regard to such material was quite heavy, for in accordance with the various funds established by federal statute, state budgets and estimates of expenditure were submitted for different funds annually, quarterly and even monthly. Moreover, while original state plan material was concerned with certain basic provisions, additional annual and five year plans were also submitted. In reviewing plans and budgets, the regional staff looked for proper content, balance and emphasis. It is significant that joint budgets were worked out between the division of health services and the Public Health Service. The regional medical director and his staff visited the state staffs and advised on suggested and mandatory standards. The regional medical director himself was responsible for threshing out conformity and compliance issues with the head of the state agency. The regional medical director with his entire regional

104

REGIONAL

ORGANIZATION

OF T H E

SSA

staff m a d e on-the-spot inspection of state services

whenever

g r a v e issues of c o n f o r m i t y arose and, at times, on an a d v i s o r y basis. D e c e n t r a l i z a t i o n in the d i v i s i o n of health services had c o m e a l o n g w a y f r o m the d a y s w h e n all the regional medical dir e c t o r s w e r e stationed in W a s h i n g t o n , w i t h the exception of t w o , a n d M i s s L e n r o o t , the director of the children's bureau, r e v i e w e d e v e r y letter that w e n t out. N o t o n l y w e r e the regional medical d i r e c t o r s a n d their s t a f f s placed in the field, but by 1 9 4 7 they h a d m o r e discretionary a u t h o r i t y than a n y regional representative of the S S A . T h e regional medical director h a d the p o w e r even t o a p p r o v e revisions of plans and b u d g e t s if these did not result in substantial departure f r o m the annual plans. 1 4 A l t h o u g h merit s y s t e m w o r k and a u d i t i n g w e r e

separated

into special units in the children's bureau, they w e r e not decentralized t o the r e g i o n s since the w o r k load w a s not sufficient to j u s t i f y this m o v e . It seemed a w a s t e in this respect not t o use the services of the regional representatives of the bureau of a c c o u n t s and a u d i t s and the state technical a d v i s o r y service. C o m p e n s a t i o n a n d classification plan materials w e r e carefully reviewed

b y the r e g i o n a l

representatives of the d i v i s i o n

of

health services a n d the social service division, as well a s by the state merit s y s t e m unit, w h i c h latter w a s composed of only three persons. T h e state merit system unit published its o w n s t a n d a r d s f o r a merit system and proposed qualifications f o r s o m e positions, but w i t h r e g a r d to the latter the unit relied h e a v i l y on the t w o o p e r a t i n g divisions for the qualifications of professional w o r k e r s . I t used the Draft Administration,

published

by

the

Rule

Social

for Merit Security

System

Board

in

1939, and relied on the personnel r e v i e w s of the state technical a d v i s o r y service of t h e S S A w h e r e v e r possible. S i n c e it w a s small in size, it w a s not able t o d o test construction w o r k t o a n y degree. 14 The National Archives, Federal Register, pp. 177A-536 to 177A-540.

REGIONAL

OFFICES

105

The state audit unit of the children's bureau, traveling out to the field from Washington, made audits quite similar to those made by the bureau of accounts and audits. They were made annually on a test basis against the state plan and were concerned not only with checking program standards, but also with proper standards of business, fiscal and management matters. The internal checks of fiscal systems were carefully audited, and auditors advised on the construction of accounting systems. The auditors not only reviewed expenditure reports, but (peculiar to the children's bureau) they also reviewed the budgets for mathematical accuracy and the use of proper budgeting standards and tools. " Service " Bureaus The functional bureaus also had regional representatives. Besides the fact that these representatives were operating rather than only auxiliary in nature, it should be remembered that they afforded a constant flow of separate and specialized information, opinion, and action to Washington on the basic assistance and unemployment compensation jobs being carried out on the regional and state levels. The regional auditor was usually assisted by two assistant auditors and an auditor-in-charge for each state in the region. The auditor-in-charge most often resided in the state to which he was assigned. The regional office audit clerk, who did the auditing of the payroll, vouchers, etc., for the regional, field and area offices in a given region, was also on the staff of the regional auditor. The regional auditor and his staff carried on the audit for the activities of the bureaus of employment security and public assistance, the merit system councils and, during the war, for the grants under civilian war assistance and assistance to enemy aliens and others affected by restrictive Governmental action. In all cases the auditors ran a test check audit and were concerned with the soundness of the fiscal systems and the internal checks used. In the case of unemployment compensation the

106

REGIONAL ORGANIZATION

OF T H E SSA

100% administrative grant resulted in the establishment of detailed business and administrative management standards. The audit was made for these, as well as for standards in the Act; for state laws, decisions, rulings, and the like; for fund accountability; for the appropriate allocation of costs to unemployment compensation as compared with employment service and veterans readjustment allotment activities; and for the deposit of unemployment compensation taxes in the trust fund. In the case of public assistance the audit was not so comprehensive, for few administrative and business standards existed. The public assistance audits were against the state plan, substantive program standards in the Act, 15 and expenditure statements. The auditors also checked to see that federal funds had been properly matched and that there were state funds available for matching purposes. The regional auditors also offered their services to state public assistance agencies in the establishment of proper accounting systems. The audit of merit system funds was mainly concerned with the proper allocation of funds from the federal-state programs jointly supporting merit system costs. Audits in normal times were made every six months and often resulted in disallowance and possibly in the discovery of a conformity issue. All such findings were cleared carefully with the operating bureaus. 16 The regional attorney was under the same general supervision and coordinating authority of the regional director as the other representatives of the functional bureaus even though he was under the technical direction of the general counsel of the Agency. H e was assisted usually by a field attorney, sometimes called an assistant regional attorney. For the bureau of old age and survivors insurance he gave legal advice on claims 15 Violations of these were reported in an administrative section of the audit. 16 Social Security Board, Organizational and Functional Chart, Social Security Board Regional Office. Social Security Board, Administrative Order No. 11, pp. 9-10. Social Security Board, Administrative Order No. 49. Social Security Board, Administrative Order No. 21. Much of the data in these cited documents was out of date and was supplemented by interviews.

REGIONAL

OFFICES

IO7

to regional and area offices. It will be remembered that, under the Social Security Act, survivorship was to be determined by state law. The regional attorney also assisted the regional referee on legal matters involving appeals on claims under the old age and survivors insurance program, and this was especially needed in the case of the three referees who were not lawyers. F o r the public assistance and employment security programs the regional attorney advised with regard to legal questions of conformity arising f r o m : legislation and legislative proposals; state rules, regulations, judicial decisions, and attorney general opinions; state plan documents in the case of public assistance; and certified laws and plan documents in the case of employment security. The regional attorney also performed a similar function for vocational rehabilitation in its seven regions. He acted as a legal advisor on all matters involving Board employees or regional business matters and on all litigation involving the Act. H e offered his assistance to the states in litigation involving the S S A ' s federal-state programs. During the war he was legal advisor to the regional director on Community W a r Service activities. In 1946-47 an experiment was going on in one region in having the regional attorney do the legal work for the Food and D r u g Administration. 1 7 There was usually but one representative of the informational service in a region. It was his responsibility to give technical aid to the regional director and the regional representatives in their public relations work as well as to serve as a mentor of Board public relations policy in the region. He planned and conducted the regional relations program, utilizing materials from Washington, issuing press releases and controlling work with the radio, press, the public and organized groups. In addition, he answered simple inquiries and reported to Washington on public reaction to S S A programs. F o r a long time the work of the informational service representative 17 Social S e c u r i t y B o a r d , Organisational and Functional Chart, Social Security Board Regional Office. Social S e c u r i t y B o a r d , Administrative Order

No. 11, p. 7. Social Security Board, Administrative

Orders, Nos. 2, 3, 4.

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OF T H E

SSA

for the program bureaus concerned almost exclusively the public relations program of the field offices of the bureau of old age and survivors insurance. The informational service representative helped by advising and supplying materials and the technical skill for educating the public, employees and employers as to their rights and responsibilities under the old age and survivors insurance program. Together with the regional representative of old age and survivors insurance, he reviewed reports from the field offices on their public relations activities, including a formal quarterly report. Later he developed his work with the federal-state programs. H e attended the intraregional conferences of the federal-state programs and, except in the case of the programs of the children's bureau, advised and assisted state agencies in their public relations work. 18 In each region there was a personnel methods consultant, representing the state technical advisory service, who was responsible for the enforcement of the merit system standards, programs, and policies in the public assistance and employment security programs, in cooperation with the regional representatives of these programs. The personnel methods consultant was delegated authority with some limitations to review, approve or recommend changes in state merit system laws, plans, rules, and regulations with regard t o : organization and administration, classification, compensation, recruitment, selection, efficiency ratings, coverage, budgets, offices, examinations, relationships between the merit system agencies and the operating organizations, and records and reports. He was also Order No. 11, pp. i o - i i . Social 18 Social Security Board, Administrative Security Board, Organisation and Functional Chart, Social Security Board Regional Office. Congress eliminated the informational service regional representatives in its appropriations for the fiscal year 1947-48. Their activities for the field offices of old age and survivors insurance were taken over by the regional representatives of that bureau, who reported to the coordinating and procedure section of their field division, which had an information section. The responsibilities for gauging public opinion and reaction to the social security program were assigned to the regional director of the S S A , or his designe, who reported to an informational service division in the office of the Commissioner.

REGIONAL OFFICES

I09

responsible for conducting a periodic merit system review. This was in the nature of an objective administrative audit and an administrative analysis, and was used to check compliance with standards and with the principles of good merit system administration. On the basis of these merit system reviews he made recommendations for remedial action on the part of the state. The reviews were also of value to the children's bureau, the Office of Vocational Rehabilitation, and the Public Health Service where there were joint merit systems or statewide civil service systems, for these organizations were without the skills to make such reviews. There were twelve regional referees of the appeals council, distributed in the various regional offices according to work load. Thus, except for three regions, there was one regional referee in each regional office. The Denver and Chicago regional offices were not assigned regional referees, but there were three in the New York office. Neighboring regional offices handled the work loads for the Denver and Chicago regions. Each regional referee had a reporter assigned to him. It was the duty of the regional referee to hear appeals from the determinations made by the field and area offices of the bureau of old age and survivors insurance on claims and on wage record discrepancies. Hearings were held in the region in the town where the appellant resided or in the nearest town thereto. It was possible to appeal from the decision of the referee to the appeals council itself, and the referee was empowered to refer matters in his discretion to the appeals council. Although the regional referee was housed in the regional office and received housekeeping and business services therefrom, he was in no way under the authority of the regional director or of the regional attorney (from whom he sometimes took advice) or of the regional representative of old age and survivors insurance. But it should be noted that his decisions were bound by the appeals council's decisions, by court decisions, and by those of the Commissioner of Social Security. They were guided by the opinions of the general counsel,

IIO

R E G I O N A L ORGANIZATION OF T H E SSA

especially those chosen by the bureau of old age and survivors insurance as precedent opinions. On the Washington level, the bureau of old age and survivors insurance had the right to appeal from a decision of the appeals council to the general counsel, whose decisions on cases affecting classes or groups of persons was final. The bureau of old age and survivors insurance was also permitted to appeal to the Commissioner, whose decisions were final on all matters. 19 COMMENTS ON THE DEVOLUTION OF F I N A L AUTHORITY TO THE REGIONAL L E V E L

It is not the purpose of this volume to examine the conditions under which final authority can be delegated to the field. T h e matter has already been treated extensively by David B. T r u man and James W . Fesler. 2 0 In the grant-in-aid situation there is not so much necessity for final action in the field as in the case of some other Federal field activities. Sufficient time is allowed by the procedure—involving plan, budget, grant, audit and inspection—for leisurely consideration at the center. T h e regional or field location is maintained to bring about savings in travel cost, customer convenience, ease of contact, face to face negotiation, guidance, review and education. This is not to say that the regional representatives of the grant programs in the S S A did not exercise real influence and authority through advice, persuasion and personal contact with the states. Some comment on the degree of final authority possessed by the regional representatives of the S S A may help to clarify 19 Social Security Board, Organizational and Functional Chart, Social Security Board Regional Office. Social Security Board, Basic Provisions for the Hearing and Review of Old Age and Survivors Insurance Claims, with a Discussion of Certain Administrative Problems and Legal Considerations (Washington, D. C.: Federal Security Agency, January, 1940). (Processed.) Appeals Council, Referee's Manual (Washington, D. C.: Appeals Council, Social Security Board, 1946). (Processed.) 20David B. Truman, Administrative Decentralization (Chicago: The University of Chicago Press, 1940), pp. 82-125. James W. Fesler, Federal Administrative Regions..., pp. 453-465.

REGIONAL

OFFICES

III

their roles and duties. T h e old original " operating " bureaus of the S S A granted little final authority to their regional representatives. A t one time the employment security representative was allowed to approve the state transfer of funds between certain categories of state budgets, but with the new budget system based on the adoption of administrative and business standards by the states and the provision of unit cost and work load data, the states were relieved of the responsibility of sticking to budget categories in making expenditures. In 1 9 4 1 it was officially stated that all employment security budget, plan and grant activities were to be decentralized to the regions, but this w a s never accomplished. In 1946-47 the employment security representative had final authority only to approve state purchases of non-standard equipment and outof-state travel by state employees. The public assistance representative was also without notable final authority. But the limited role of the regional representative of the bureau of old age and survivors insurance was perhaps most inexcusable. A t one time the bureau's field division sent persons from Washington who duplicated his inspection of field offices and his training of field office personnel. T h e bureau never did abandon a close check of the regional representatives, and for this purpose sent Washington inspectors to field offices. T h e assignment of positions to field offices by the regional representative of old age and survivors insurance was carried out under tight, centrally determined staffing schedules, work-load controls and region-wide personnel ceilings. Above all there was no reason why the regional representative could not have taken over the supervision of the area offices in his region. It would have been necessary only to consolidate the small central organization of the claims control division with the field division of the bureau of old age and survivors insurance. A s a result, supervision and inspection of area offices could have been carried out by the regional representative and his staff, located usually in the same city as the area offices, rather than by costly travel out of Washington.

112

REGIONAL

ORGANIZATION

OF T H E

SSA

Important devolution of discretionary authority to the region in the SSA occurred only in the case of the children's bureau, the state technical advisory service and the appeals council. The social service division of the children's bureau operated under no statutory standards, but on a contract basis with the states. Projects involved the mutual consent of both the state and federal governments. Since the regional welfare consultants were the negotiating officers in this fluid situation, they had considerable individual authority. It will be remembered that the regional medical director of the division of health services of the children's bureau had important discretionary authority, including the power to approve revisions of plans and budgets where, in his opinion, a substantial departure from annual plans was not involved. The personnel methods consultant of the state technical advisory service had full authority to approve changes in almost all aspects of state merit personnel systems, except that changes in rules and regulations had to be in accordance with established standards, changes in classification and compensation plans could not involve a completely new plan and matters of policy, changes in salary or leave regulations had to conform with the fiscal standards established by the " operating " bureaus, and changes in budgets had to be in accordance with the financial agreement made between the federal agencies financing a state merit personnel system. The regional referee had complete authority to decide cases in accordance with existing law and the decisions of the appeals council, of the Commissioner, or of the general counsel. His decisions were, of course, subject to appeal to the appeals council. Devolution of authority is easy in the adjudicatory situation because of the existence of criteria, indicia, precedent decisions, and the right to appeal and because of the relative absence of policy variables. Both the SSA and its predecessor, the Social Security Board, refrained, for the most part, from delegating significant final authority to the regional level. This policy often resulted in

REGIONAL

OFFICES

113

considerable duplication of effort and w a s subject to considerable criticism. 2 1 21 Cj.

V.

O. Key,

The

Administration

of Federal

Grants

to

States

(Chicago: Public Administration Service, 1937), pp. 221-226. R. C. Atkinson, The Federal Role in Unemployment Compensation ( W a s h i n g t o n , D. C . :

Social Science Research Council, 1941), pp. 55-59- Hearings before the Subcommittee of the Committee on Appropriations, House of Representatives, 80th Congress, 2nd Session, on The Supplemental Federal Security Agency

Appropriation Bill for 1949 (Washington: Government Printing Office,

1948), p. 241.

CHAPTER V T H E DETERMINATION OF AREA A N D T H E LOCATION OF HEADQUARTERS THE basic difficulty which the Social Security Board faced when seeking to determine its regional areas is common to all multi-program regional organization. It lies in the fact that in such organization the adminstrative convenience of each program may be served best by a different areal pattern and a different location of regional headquarters. It is revealing to note that this problem of reconciling the needs of different programs for different areas can appear in any multiple regional decentralization even when the program bureaus are functionalizations of one job rather than four or five distinct tasks. For example, in the case of W P A the same regions might not have been satisfactory for carrying on work relief projects for both actors and industrial workers. This fact would seem to indicate that attempts at multi-program regionalization ought not be abandoned merely because of some administrative inconvenience to some programs. Rather, the aim should be to develop an areal design which avoids inconvenience to any program or failing this to determine how far inconvenience may be suffered in order to achieve the advantages of multiple regional organization. In the Board's case the determination of common regions and regional headquarters was facilitated by the fact that although the bureaus of public assistance and unemployment compensation (and later the children's bureau) had different programs their clientele were the states, their programs were grant programs, and their administrative techniques were similar. This latter fact resulted in the formation of the functional bureaus, and for the most part the same regional areas were convenient for the functional bureaus as for the federalstate program bureaus. In the old age and survivors insurance program the clientele were individuals, and administrative 114

REGIONAL AREAS AND HEADQUARTERS

115

convenience dictated regional areas based on density of industrial population. The problem was merely to establish regional areas and regional headquarters which would be convenient for both the grant programs, which dealt with groups of states, and for the old age and survivors insurance program, which for the most part dealt with industrial workers. M A I N I N F L U E N C E S ON T H E BOARD IN DETERMINING REGIONAL AREAS AND

HEADQUARTERS

James W. Fesler has suggested certain indices as important in the construction of regional areas for administrative convenience. They may prove helpful here as standards by which to judge the Board's efforts. Fesler stated that for any given agency the size and boundaries of regions should be determined by the number of regional chiefs which Washington can supervise, the location of the objects of administration, the magnitude of the job to be done and its relation to any area, the equalization of work load between regions, the relative convenience of transportation and communication facilities, the regional areas of cooperating agencies, and those previous regional areas of an agency around which relationships may have developed. 1 For the location of regional headquarters, Fesler has suggested as important the location of objects of administration within the region, the location of state headquarters, the location of the headquarters of other Federal agencies, and the availability of office space and of transportation and communication facilities. 2 A review of the total Board effort in designing its regional areas and in establishing regional headquarters reveals that the Board took many factors into consideration and was subject to many influences. The Board approached the delineation of area in terms of administrative convenience in getting the job done rather than in terms of recognizing regional area as de1 James W . Fesler, " Federal Administrative Regions . . . , " p. 471. 2 Ibid., pp. 440, 443. See also James W. Fesler, Area and pp. 50-60.

Administration,

Il6

REGIONAL ORGANIZATION

OF T H E

SSA

termined by social and economic factors. Yet the Board in determining what groups of states were to be placed together as a region was influenced by the thinking of the National Resources Committee with regard to " American regions." T h i s fact is clear from the final state groupings. 3 The Board's approach was certainly justified since the grant activities were dealing with public assistance and unemployment compensation, the administration of which would be conditioned by social and economic factors. Transportation lines also influenced the grouping of states by the Board, for a region of states could not be designed in such a fashion as to require unnecessary travel or transfer points in travel by a regional representative. In one case, however, the Board in grouping states into a region ignored the dictates of transportation lines. The number of states which could be combined in any one region was influenced by two factors which in some instances were not recognized by the Board in spite of its awareness of their existence. First, where the geographical expanse of the states was wide, as in the West, only a small number could be placed in any region, or else intra-regional travel would be too expensive and too burdensome for the regional representatives. Second, questions of clientele limited the number of states which could be placed in any one region. Since most of the regional representatives dealt with grant activities, their peak work load occurred when state legislatures were in session. Hence the number of states the regional representatives could cover was limited regardless of the geographical expanse of the states involved. Moreover, where urban population was dense, the concentration of field offices of old age and survivors insurance was greater. This meant that in the urban states 3 W . L. Mitchell, " Washington-Field Relationships in the Social Security Board," Washington-Field Relationships in the Federal Service ( W a s h ington, D. C.: U. S. Department of Agriculture, 1942), P- 41. B. E . W y a t t and W . H . Wandell, The Social Security Act in Operation (Washington, D. C.: Graphic Arts Press, 1937). PP- 45-144- James W . Fesler, " I n t e r departmental Relations in the Field Service of the Federal Government," op. cit., p. 52. National Resources Committee, op. cit., pp. xi, 74-82, 155, 170, 183-201.

REGIONAL

AREAS

AND

HEADQUARTERS

117

the work load of the regional representatives of old age and survivors insurance rose so rapidly that they could cover only a few states. In selecting its headquarters cities the Board gave consideration to the headquarters cities suggested by the National Resources Committee and to those cities where Federal regional headquarters predominated as pointed out by Mr. Fesler for the National Resources Committee. 4 The Board also considered transportation and communication facilities to state capitals and to Washington. Unfortunately politics and personal influence were also important in the selection of some headquarters and, in one instance, in determining the areal delineation of the region. T H E D E L I N E A T I O N OF R E G I O N A L A R E A S A N D T H E LOCATION

OF R E G I O N A L

HEADQUARTERS

A s early as December 2, 1 9 3 5 , the Board established a field committee to make recommendations to it on the whole matter of field organization. The field committee was to canvass not only the duties of the regional offices, but also the nature of central supervision over the region, the location of regional headquarters and the delineation of regional areas. It had at the outset the same kind of responsibility with regard to the field office structure of the bureau of federal old age benefits (now old age and survivors insurance), which was to exist on a geographical level below that of the regional offices. The committee was organized under the supervision of the coordinator, Henry P. Seidemann. Its chairman was William Stead, who had experience in field organization from his work in the United States Employment Service and the National Reemployment Service. Stead withdrew as chairman on Febru4 Cj. ibid., pp. xi, 72, 194, 195. The technical committee of the National Resources Committee suggested only a few such headquarters and these were considered tentative. The Committee felt that the first step toward field coordination of activities and regions was at least to establish identical headquarters cities. The wartime experience of Community W a r Services proved that this was a sound suggestion.

Il8

REGIONAL ORGANIZATION

OF T H E

SSA

ary i, 1936 and left the Committee on May 1, 1936 just at the completion of its initial work. The Board determined its regional areas and headquarters on May 13, 1936. After this date the field committee was not important in the work of area determination or the definition of lines of authority. Depending on the matter involved, this work was decided thenceforth by the executive director, the coordinator, the consultant, the director of the bureau of federal old age benefits and the Board. The field committee had as resource material the study of the National Resources Committee, Regional Factors in National Planning, and it made studies of the regional organizations of the Federal Reserve System, the Post Office Department, and the United States Employment Service. It did not however, investigate the Veterans Administration which had a decentralized insurance function, and this was reflected in its failure to decentralize the claims activities of the bureau of federal old age benefits. It was instructed not to cut across state boundaries, since federal-state negotiations were involved. The field committee investigated and drew up charts on population to be covered by the federal old age benefits program (compensable population), on population density, and on transportation and communication facilities. The committee's report proposed three plans for the gradual development of regional areas and headquarters. First the country was to be divided into thre«» regions, and after these were working, they were to be divided so that there would be nine regions, and then there were to be additional divisions so that finally there would be a twelve region system. The Board at this time was experiencing considerable political pressure with regard to the location of regional headquarters and with regard to regional appointments. It decided, therefore, to establish all twelve regions at once, and its final decisions were based on but did not accept entirely the field committee's plan three.

REGIONAL

AREAS

AND

HEADQUARTERS

II9

T h e field committee's plan three called for the following regions and headquarters cities: Region I composed of N e w England with Boston as the headquarters city; Region II composed of New Y o r k and N e w Jersey with New Y o r k City as headquarters; Region III, of Pennsylvania, Delaware, Maryland, the District of Columbia, Virginia and West V i r ginia with perhaps Pittsburgh as headquarters; Region I V , of Michigan, O h i o and Kentucky with Columbus as headquarters; Region V , of Wisconsin, Illinois and Indiana with headquarters in Chicago; Region V I , of Tennessee, North Carolina, Mississippi, Alabama, Georgia, South Carolina and Florida with headquarters at Atlanta; Region V I I , of the Dakotas, Minnesota, Iowa and Nebraska with the twin cities for headquarters; Region V I I I , of Kansas, Oklahoma, A r k a n sas and Missouri with Kansas City, Mo. as headquarters; Region I X , of N e w Mexico, T e x a s and Louisiana with Dallas as headquarters; Region X , of W y o m i n g , Utah and Colorado with headquarters at Denver; Region X I , of Montana, Idaho, Oregon and Washington with headquarters at Seattle; and Region X I I , of California, Nevada and Arizona with San Francisco for headquarters. Territorial offices were suggested for Alaska and Hawaii. T h e field committee plan showed that in determining regions and regional headquarters, it had weighed the availability and ease of intra-regional transportation and communication, the concentration of compensables under the federal old age benefits program, and distances to be covered by regional representatives. N o more states were placed in any one region than a regional representative for one of the grant programs could be expected to handle. Moreover, in selecting regional headquarters emphasis was placed on those cities most commonly chosen as the regional headquarters for Federal agencies. In issuing its approved regions and headquarters on M a y 13, 1936 the Board made unfortunate modifications in the field committee's plan. Shifts were made between Regions II, I I I and V I I resulting in the creation of an additional re-

I20

REGIONAL ORGANIZATION

OF T H E

SSA

gion in the East, and between Regions X , X I and X I I in the West, eliminating one of these last three. There were also changes in the selection of headquarters cities. Region II of the field committee's plan was changed from New York and New Jersey to include only New York. The reason for this change lay in the interests of the regional directors who were to head Regions II and III. Regional directors were chosen in part because of their regional influence. Mrs. Rosenberg, who was to head Region II, had no interest in New Jersey. On the other hand Judge Dill, who was to head Region I I I , came from New Jersey. The move was partly justified by the heavy federal old age benefits load of New York. After the shift of New Jersey to Region I I I , a general reshuffling of regions became necessary. Region I of course stayed the same; Region I I became New York alone with New York City as headquarters, and Region I I I became Pennsylvania, New Jersey and Delaware with Philadelphia as headquarters. A new Region I V was created mostly out of old Region I I I and composed of West Virginia, Maryland, the District of Columbia, Virginia and North Carolina (from Region V I I ) with Washington as headquarters. The creation of a new Region I V caused a shift in the enumeration of all regions after region four. The field organization committee's Region I V remained the same except that it now became Region V, and its headquarters was changed to Cleveland from Columbus. This latter move was made by the Chairman of the Social Security Board to head off a political drive, abetted by a Board member, for an undesirable regional head who lived in Columbus. The field committee's Region V became Region V I . Region V I became Region V I I and, of course as noted, lost North Carolina to the new Region IV. In addition, its headquarters was changed to Birmingham from Atlanta because of the influence of Senator Black and because the Board was not certain from the planning indices which of the cities constituted a better center. Regions V I I , V I I I and

REGIONAL

AREAS

AND

HEADQUARTERS

121

IX became Regions VIII, IX and X, respectively. The headquarters of the last of these was changed to San Antonio from Dallas because Oscar Powell, whom the Chairman wanted for regional director, resided in San Antonio and did not wish to move. Experience showed that most Federal agencies, including those with which the Board had to deal, were operating out of Dallas. The creation of a new Region I V in the East was balanced by the elimination of old Region X in the far West. It was incorporated in Regions XI and XII. Thus, Region XI was composed of Montana, Idaho, Wyoming, Utah, Colorado and Arizona with Denver for headquarters. Region X I I was composed of Washington, Oregon, Nevada and California with San Francisco for headquarters. COMMENT

ON T H E

BOARD'S

MODIFICATIONS

COMMITTEE'S

OF

THE

FIELD

PLAN

Not only were the motives which prompted the Board's changes of the field committee's regional plan unjustified for the most part, but the modifications themselves proved undesirable in the long run. Making New York a region by itself meant that those regional persons who dealt with federal-state negotiations did not have sufficient work load. The principle of equality of work load between regions was violated. The only regional people whose activities related to density of population were the regional representatives of old age and survivors insurance, the regional referees, and to a small extent the regional auditors and the administrative reviewers for the public assistance program. The connection in the last two instances was slight since only test audits were taken, and the work of these particular regional people varied most in proportion to the number of states involved. The Board's creation of two western regions instead of the field organization committee's three resulted in a vertical combination of mountain states and of coastal states. This violated transportation lines moving west and created huge distances to

122

REGIONAL

ORGANIZATION

OF T H E

SSA

be covered although, like making New Y o r k a region, it reflected federal old age benefits compensable load. Under the arrangement it was necessary in order to get to Phoenix or Tucson from Denver to go first to Albuquerque or Los Angeles. Except for the selection of Cleveland over Columbus all of the Board's changes of regional headquarters proved to be undesirable. Atlanta, not Birmingham, was the regional center for most Federal agencies in the Southeast. Most Federal agencies operated out of Dallas, not San Antonio, in the Southwest. For instance, the social service division of the children's bureau, with which the bureau of public assistance had to cooperate, was at that time operating out of Dallas. During the war, the W a r Manpower Commission, with which the bureau of employment security had administrative relations, was located in Dallas. The errors in the Board's modifications of the original field committee plan were revealed in subsequent changes. In 1943 Judge Dill left the Board and in October of that year Regions I I and I I I were combined although the combined region was called Region I I - I I I . The bureau of old age and survivors insurance had two regional representatives in this region. Each, with his assistant representatives, was responsible for a network of field offices. These were constructed along transportation lines, not on the basis of states, and were called II-A and II-B. B y this solution the regional representatives for the grant programs had an adequate state load, while the representatives of old age and survivors insurance did not have a load beyond their capacity to handle. In October 1943 Arizona was taken out of Region X I and added to Region X I I . In this fashion the two regions were so arranged as not to cut across transportation lines. It should be noted, however, that the move increased the distance problems of Region X I I . With regard to regional headquarters, Atlanta became early in the Board's history the headquarters for Region V I I in place of Birmingham; and in

REGIONAL

AREAS

AND

HEADQUARTERS

123

1947 the Commissioner decided to exchange San Antonio for Dallas. C O N T I N U I N G P R O B L E M S OF R E G I O N A L A R E A I N

1946-47

In July 1946 the children's bureau was transferred to the S S A from the Department of Labor. Its social service division and its division of health services each had its own regional structure. For three years before its transfer the social service division had maintained the same regions and regional headquarters as the S S A since the division and the bureau of public assistance both dealt with state departments of public welfare in regard to programs for children. The division of health services did not have the same number of regions or the same regional headquarters as the S S A . Early in 1947, however, the regions of the division of health services were correlated with those of the S S A . In some instances it was necessary to have one health service regional staff serve two S S A regions. All regional headquarters for the division of health services were made the same as those for the S S A as a whole except that the division continued to use Dallas in the Southwest instead of San Antonio. In 1947 the regional structure of the S S A could have been improved perhaps by reducing the number of states covered in any one region. Experience indicated that five states were about right for any one regional office to handle when the legislatures were in session. Thus it might have been desirable to reduce Regions I and V I I . This could have been done by recreating a Region I I composed this time of New York, Connecticut and New Jersey. Region I I I would then have been composed of Pennsylvania, Delaware and West Virginia; and Region I V , of its then existing states minus West Virginia and plus South Carolina from Region V I I . No violation of proper old age and survivors insurance regionalization would have resulted from these changes, and they would have established a work-load balance for the federal-state activities. Re-

124

REGIONAL

ORGANIZATION

OF

THE

SSA

gion X I I with the addition of Arizona created formidable problems of distance, and it would appear that the field organization committee's original plan for the Mountain and Pacific States would have been more desirable. But it was apparent in 1 9 4 7 that the question of the regional pattern for the S S A was to be decided within the larger framework of a regional structure for the whole Federal Security Agency. A s has been stated, during 1946-47 the Federal Security A g e n c y began to consider the development of an Agencywide regional pattern, and a committee was appointed to analyze the possibilities. T h e committee was composed of Dean Snyder, the Deputy Commissioner for Special Services, chairman, and of Elton Woolpert of the Public Health Service and H a r r y Holland of the S S A . S In its report of M a y 1947 the committee showed that it was possible to establish common or correlated regional areas and headquarters of from nine to eleven in number for the bureau of state services of the Public Health Service, the Office of Vocational Rehabilitation, the Office of Education, and for all of the S S A . In the case of the F o o d and Drug Administration the study indicated that its three regions could be made to correlate with an overall regional pattern, and its three regional headquarters could be made identical with three of the overall regional headquarters. T h e advantages in terms of savings and coordination, especially for the federal-state programs, outweighed the slight administrative inconvenience which would be experienced by some of the constituents of an Agency-wide regional set-up. 6 It had long been suspected that a regional structure for the Agency was possible, but the survey made clear how it was possible in terms of area and headquarters. 7 5 See chapter iii, supra,

pp. 79-80, n. 31, pp. 84-86.

6 For a listing of the advantages see chapter iii, supra,

p. 80.

7 Dean Snyder, et al., op. cit., pp. 8 - 1 2 ; app., exhibits A - D , pp. 1-6. O n July 30, 1948 the Federal Security A g e n c y did establish an A g e n c y regional organization. For a discussion of its nature, see chapter iii, supra, n. 3 1 , pp. 84-86. T h e location and boundaries of the n e w regional offices were as

REGIONAL

AREAS

AND

HEADQUARTERS

125

T H E D E T E R M I N A T I O N OF O T H E R G E O G R A P H I C A R E A S

The field organization committee also was responsible for the establishment of the field offices of the bureau of federal old age benefits (now old age and survivors insurance). It made its first report on the location of field offices on January 29, 1936. A t this time both the field committee and the Board thought in terms of district offices as the basic unit of the federal old age benefits field structure. There was to be at least one of these in each state, with the addition of other district offices depending on the compensable load. These district offices were to have primary and secondary offices under them, depending on the follows: Region I was composed of Maine, N e w Hampshire, Vermont, Massachusetts, Rhode Island and Connecticut with Boston as headquarters; Region II, of N e w Y o r k , Pennsylvania, N e w Jersey and Delaware with N e w Y o r k as headquarters; Region III, of Maryland, Virginia, West V i r ginia, North Carolina and the District of Columbia with Washington as headquarters; Region I V , of Michigan, Ohio and Kentucky with Cleveland as headquarters; Region V , of Minnesota, Wisconsin, Illinois and Indiana with Chicago as headquarters; Region V I , of South Carolina, Georgia, Tennessee, Mississippi, Alabama, Florida, Puerto Rico and the V i r g i n Islands with Atlanta as headquarters; Region V I I , of North Dakota, South Dakota, Nebraska, Iowa, Kansas and Missouri with Kansas City, Mo. as headquarters; Region V I I I , of N e w Mexico, Oklahoma, Texas, Arkansas and Louisiana with Dallas as headquarters; Region I X , of Montana, Idaho, Wyoming, Utah and Colorado with Denver as headquarters; Region X , of Washington, Oregon, California, Nevada, Arizona, A l a s k a and Hawaii with San Francisco as headquarters. See Federal Security Agency Order 16, Agency Field Organisation-Regional Boundaries. Some of the constituents of the Federal Security A g e n c y in some cases serviced two or more Agency regions from a single regional city. T h e children's bureau serviced Puerto Rico and the Virgin Islands out of Washington instead of Atlanta. Many factors had to be considered in determining the A g e n c y regions, but a casual examination indicates that distance problems of the western regions (Regions V I I - X and especially Regions V I I I and X ) must have been considerable. In terms of the balance of federal-state work among regions, the three state Region I V appears too small especially since there were three regions composed of six states. Of course, when deciding the number of states to be placed in any region, the Public Health Service placed a great deal of emphasis on the content of its state programs and the difficulties to be faced in pushing its programs. Moreover, there is nothing wrong with Region I V from the point of view of the density of compensables under the old age and survivors insurance program.

I2Ó

REGIONAL

ORGANIZATION

OF T H E

SSA

compensable load and other coverage situations. The district offices were to have administrative responsibility to Washington for these primary and secondary offices, with the regional federal old age benefits representative carrying out only inspection and training functions. District offices were to be placed in state capitals in order to serve the other bureaus of the Board which dealt with state legislatures, and where this was not feasible, primary offices were to be so situated. A s early as July 1936, however, the regional representatives of federal old age benefits were given full supervisory authority over all offices within their regions, and the term branch offices was applied to the primary and secondary offices without distinction. On April 6, 1937, the Board abandoned the concept of district and branch offices and developed the idea of field offices all equally under the authority of the regional representative, but varying in size and staff in accordance with compensable load. The first field offices were opened in October 1937. In determining their location, the number of covered workers or compensables was the most important factor. Other factors included communication and transportation facilities, state capitals, population trends, cultural and racial homogeneity of population, area coverage, and the availability of office space. In later years, of course, the bureau of old age and survivors insurance had actual work-load data and estimated work-load data for given time periods to aid in the determination of the location, opening, closing, staffing and consolidation of offices. A s the work of old age and survivors insurance developed, the necessity became apparent for offices smaller than the field offices in order to cut down on the cost of travel and to extend service to the growing load. A few branch offices of field offices were established; these were composed of one or two employees and a minimum of records. During the war, in order to save personnel and money, many field offices were reduced to branch offices. These branch offices, of course, were not in any

REGIONAL

AREAS

AND

HEADQUARTERS

12"J

way similar to the fully operating offices envisaged under the district office-branch office system at the outset of the Board. In 1947 the branch offices were being supplanted on the one hand by the re-establishment of field offices and on the other, by detached official stations. These latter were merely the location of resident representatives in out of the way communities where work loads failed to justify the establishment of field offices. T h e representatives relied on the mails and frequent visits for access to records which were kept at the field offices. During 1946-47 the bureau of old age and survivors insurance also maintained approximately 1,800 itinerant stations. These were at locations which produced a large amount of business and were visited on a regular schedule by the manager or other representatives of the field offices. N o rental charges were involved, for the itinerant stations were maintained in post offices, employment service offices or other public places. In 1942 because of the demand for space in Washington for war agencies, the claims control division of the bureau of old age and survivors insurance was moved out of Washington and broken up into five area offices in New Y o r k , Chicago, Philadelphia, New Orleans and San Francisco. The basic factors in determining the selection of these headquarters 8 and their areas were equality of work load, the availability of office space in wartime, mail and transportation facilities, and travel time to regional offices, since the regional attorney had relations with the area office on claims matters. However, the Chicago office and area proved unwise both in terms of territory covered and compensable load. Hence, an additional area office was established in Kansas City, Mo. during 1946-47 in order to equalize work load and improve travel, mail and communication facilities. W o r k was shifted to the Kansas City office not only from Chicago, but also from New Orleans. This last was closed and the office moved to Birmingham where there was satisfactory office space. 8 F o r the work of the area offices and the field offices, see supra, pp. 97-98.

128

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ORGANIZATION

OF T H E

SSA

Thus in 1947 there were six area offices. New York served New England and New Y o r k ; Philadelphia served New Jersey, Pennsylvania, Delaware, Maryland and the District of Columbia ; Birmingham served Kentucky, West Virginia, V i r ginia, Tennessee, North Carolina, Mississippi, Alabama, Georgia, South Carolina and Florida; and Chicago served Wisconsin, Michigan, Illinois, Indiana and Ohio. Kansas City, Mo. served all of the states west of the western borders of Wisconsin, Illinois, Kentucky, Tennessee and Mississippi to the western borders of Montana, Wyoming, Colorado and New Mexico. San Francisco served all of the states west of this Kansas City area. COMMENT ON T H E LOCATION OF T H E AREA OFFICES

A s has been indicated in chapter f o u r 9 there were many reasons why the area offices should have been located in the same cities as the regional offices in all instances rather than in just four cases. 10 The area offices made use of the services of the regional attorneys. Their activities involved the work of the regional referee, and their work with the field offices involved the supervision of these offices by the regional representatives of old age and survivors insurance. Even when area offices were in the same cities they were not housed with the regional offices nor were their housekeeping services completely provided by the regional offices. SUMMARY

In summary it should be noted that S S A experience indicates that the establishment of identical regional headquarters and the delineation of identical regional areas in the case of multi9 See supra, p. 111. 10 In 1948 after Agency regional offices were established, there were two area offices located differently from Agency regional offices. In the southeast the regional office for the Agency and the S S A was Atlanta but the area office was Birmingham. There was an area office in Philadelphia but no Agency or S S A regional office.

REGIONAL

AREAS AND

HEADQUARTERS

129

program organization are altogether feasible. It was, in fact, the success of the SSA which made apparent that a similar regional pattern could be established for the whole Federal Security Agency. In the case of the Board and the SSA the clientele were the states, except for the old age and survivors insurance program. This circumstance plus the fact that similar techniques and therefore common specialties were used in the administration of these federal-state programs made simpler the determination of identical areas and headquarters. Since the Federal Security Agency was composed largely of federal-state programs, the Board's success in establishing a consolidated regional pattern was again significant for the Agency. 11 Although the old age and survivors insurance program dealt with individuals as compensables and its regional pattern needed to reflect urban concentration and not states, this fact did not prevent the Board from establishing identical regions. The Board merely used two normal regional old age and survivors insurance staffs in one heavily populated region and divided their work along transportation lines. Often the Board and the SSA turned the difference in program of their constituents to an advantage. Thus, field offices of the bureau of old age and survivors insurance which were located in state capitals often gathered routine information for the regional representatives of the federal-state programs located in the large cities. On the other hand, the field offices often utilized the offices of the United States Employment Service as itinerant stations. Board experience was also to the effect that there is always political pressure to place field stations in the old home town. This would seem to indicate that field headquarters and areas should be decided upon as quietly as possible and established with dispatch. It may even be desirable to postpone the search for top personnel until after the beginnings of establishment have taken place, for much stimulation of political pressure 11 Cf. Dean Snyder, ct al., op. cit., pp. 8 - 1 2 .

130

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ORGANIZATION

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comes from potential key field station heads who wish to work at home. Certainly the personal preferences of top field personnel should be resisted in the establishment of headquarters and areas. Finally, while the administrative convenience of constituent units must be considered in the establishment of areas and headquarters, it should be remembered that there is always a drive on the part of constituents for field independence. Their demands for special headquarters, therefore, must be carefully examined. Moreover, there is always more than one organizational arrangement which can be pursued in the field. Thus, where an established region of an agency is too small for a particular constituent of that agency, it is possible to allow that constituent to combine two regions under the supervision of one regional headquarters. In this fashion all regional representatives will operate only out of agency regional headquarters and the boundaries of the regional areas of all constituents will be correlated although not identical. The aim should be to establish common headquarters and areas without too much violation of the administrative convenience of any constituent. Some administrative inconvenience can be tolerated in order to secure valuable objectives.

CHAPTER VI THE DETERMINATION OF LINES OF SUPERVISION The Social Security Board's task in providing for the supervision of its regional structure was to arrange for the central command of a regional organization composed of three organic program bureaus and five functional bureaus, all under the authority of a regional director. Before examining the development of lines of command, it will be helpful to discuss basic concepts involved in the supervision of the field by the center, for the Board's pattern for field supervision emerged slowly and only after considerable controversy as to theory. Criticism of the Board's definition of lines of authority running out to the regional office was based on traditional line and staff thought involving the concepts of line and staff decentralization and the necessity for unity of command. Instead, the Board's final pattern for field supervision was based on the concept of multiple lines of command over the field and beyond this the idea of general regional command. LINE

AND STAFF

THOUGHT

Generally speaking, the dogma of line and staff thought posits that the line in any organization is composed of those persons who are actually doing the job in hand, the chain of command, while staff is composed of those who are aiding or assisting the line. The line commands and acts; staff assists in the process of command by aiding in planning, organizing, commanding, coordinating and controlling, but it does not issue orders in its own name or on its own responsibility. The general concept is simple, but authorities differ greatly as to where assisting leaves off and doing begins. It will be helpful to discuss the main concepts of staff and line, and line and function through reference to certain theorists by way of example. Luther Gulick is perhaps the leading present-day 131

132

REGIONAL ORGANIZATION

OF T H E

SSA

purist on the subject of staff. He has defined staff as those who are responsible only for knowing, thinking and planning. He notes that parts of the line also think, plan and make suggestions, and that staff also does something, but staff does not direct or appoint, or issue commands or take responsibility for a job. Gulick's position is that when administrative responsibility and authority are added to any staff function, that activity becomes a line activity. H e admits no middle ground. Although he concedes the necessity for the assistance of central purchase, personnel administration, budgeting and fiscal aids to the executive, he denies that they are staff in nature. They exist for other reasons. 1 Leonard D. White states, " The function performed by an army staff is to plan, to advise, to assist the commanding officer, to supervise, but not to command. The function of a civil staff is properly in the same terms. . . . " 2 He is clear where Gulick is not in including the function of general assistance and supervision as staff functions. White notes that staff adheres to the line throughout the organization. H e is precise in distinguishing between staff organization and auxiliary services, but he notes that the latter—that is, personnel administration, budgeting, accounting and auditing, etc.—are used more and more for the staff purposes of control. He notes that for this reason Gaus has called these services " auxiliary technical staff services." 3 The degree to which the Bureau of the Budget, for instance, has developed into a general staff for the President has been commented on by Norman M. Pearson. 4 Observation 1 L. Gulick, " Notes on the Theory of Organization," Papers on the Science of Administration, eds. L. Gulick and L. Urwick ( N e w York: Institute of Public Administration, 1937), pp. 12-13, 30-31. 2 Leonard D. White, Introduction to the Study ( N e w York: The Macmillan Co., 1939), p. 42.

of Public

Administration

3 Ibid., pp. 42-43, 63-71, 8l. 4 Norman M. Pearson, " The Budget Bureau: From Routine Business to General Staff," Public Administration Review, V (Spring, 1943), pp. 126149. See also Norman M. Pearson, " The General Administrative Staff to Aid the President," Public Administration Review, I V (Spring, 1944), pp. 130-145-

DETERMINATION

OF L I N E S OF S U P E R V I S I O N

I33

by the writer in the SSA and his experience in F E P C indicate to him that it seems best to put into separate units the control, planning, or promotional work of auxiliary agencies. Otherwise line officials resent the policy decisions made by auxiliary agencies which are really, but unavowedly, the decisions of the commander. 5 The real distinction which involves the problem of decentralized organizations, however, is whether functionalized activities can be considered staff. Lyndall Urwick is very much opposed to such a concept in his brilliant essay " Organization as a Technical Problem." In this paper he objects to the general practice in business of considering functionalized departments as staff merely because they give advice to the commander on each geographical level.6 Speaking specifically of the General Motors Export Company, as outlined by Edgar W. Smith in his article " Organization and Operating Principles " in the Handbook of Business Administration, Urwick states that the relationships of the heads of the functionalized departments to the general manager, and of their regional and plant representatives to the regional managers and plant managers could better be described as " line and function " rather than " line and staff." 7 Urwick notes that what the heads of the various functionalized departments are doing is merely one function in the total job. The fact that they give advice to the main line of command is not peculiar to them. Such advice is not synthesized as staff advice is, for it represents the point of view of specialty. 8 These department heads do not aid in the coordinating and generalizing process which is the necessary staff aid for the commander. Their position does not segregate planning from per5 Cf. M. J. Collett, " The Role of Budget, Planning and Personnel Staff Services," Public Administration Review, X (Summer, 1945), pp. 226-36. 6 L. Urwick, " Organization as a Technical Problem," op. cit., pp. 57-59. 7 Ibid. 8 Cf. on this point W. F. Willoughby, Principles of Public Administration (Washington, D. C.: The Brookings Institution, 1927), pp. 143-144.

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OF T H E SSA

formance, which is characteristic of staff. Functional units do not coordinate, but actually increase the burden on coordination. They make the process of command more difficult.* Urwick suggests the use of the concept of staff as it is employed by the British Army. He admits that other armies also consider technical and administrative heads who advise on matters in their respective fields as staff, but points out that these armies also use staff in a narrow sense to mean only those general staff officers who aid in the process of command. 10 In the British Army, according to Urwick, the distinction is definite. Those who assist the commander in the execution of his command duties are staff officers. Line is composed, in practice, of the main fighting troops, the Infantry and the Artillery. It is staff which coordinates their activities with the specialized arms and the services. It is the task of staff to lift the burden of command from the general commander by planning, organizing, coordinating, commanding and controlling. 11 Staff actually prepares the content of command and develops it by contact with its counterparts, adhering to the line of command in other echelons and other geographical areas, but the command itself is issued in the name of the commander and on his responsibility. Its working is then supervised by staff as it scavenges up and down the line of command. Staff is the means of maintaining the authority of line as the scalar chain is lengthened and as functionalization is increased and is, therefore, the best technique of coordination. 12 Urwick suggests that the only commonly used pure staff officers in civil life are private secretaries, executive assistants and the like. He suggests that the British Army staff principles 9 L . Urwick, "Organization as a Technical Problem," op. ext., pp. 60-61. 10 i but., p. 61. 11 It should be noted that Gulick peculiarly enough calls this organizing the executive and does not relate it to his concept of staff. See L. Gulick, op. cit., pp. 12-15. 12 L. Urwick, " Organization as a Technical Problem," op. cit., pp. 61-75, 82-83.

DETERMINATION

OF L I N E S OF S U P E R V I S I O N

I35

can be and should be applied to business life and notes that Fayol points out that the job of the industrial executive has the same elements as that of the military commander—planning, organizing, commanding, coordinating and controlling. 18 But many writers use the term line and staff to indicate the relationship between a commander and functionalized departments. In addition to Smith, there are Mooney and Reilly who use it in this fashion. But it should be noted that they are entirely cognizant of staff in the Urwick sense.14 Comstock Glaser not only uses the term staff to include functionalized activities, but also calls auxiliary units staff units—in short, anything which is facilitative to the main purpose. 15 Commentators on Social Security Board organization in the past such as Donald C. Stone, H a r r y A. Hopf, V. O. Key and Robert T. Lansdale almost uniformly referred to its bureaus as operating and staff bureaus and to its organization as line and staff organization. 18 It would appear to the writer that the Urwick distinction is a valuable one, and that the practice of referring to functionalized bureaus as staff is confusing and dangerous. When functional units are called staff it is quite common for them to be denied the right to command their representatives on lower geographical levels under the theory that staff does not 13 Ibid., pp. 75-77. 14 Cf. J. D. Mooney and A. C. Reilly, op. cit., pp. 174-175, 182. 15 Comstock Glaser, Administrative Procedure (Washington, American Council on Public Affairs, 1941), pp. 63-64, 133-134.

D.

C.:

16 Donald C. Stone, Report on the Organization and Administration of the Social Security Board, p. 5. Donald C. Stone, Organization Problems of the Social Security Board with Special Reference to the Bureau of Unemployment Compensation, p. 3. Memorandum of H. A. Hopf to A. J. Altmeyer and V. M. Miles, " Regarding the Eventual Complete Reorganization of the Board," p. 2. Memorandum of H. A. Hopf to A. J. Altmeyer, V. M. Miles and F. Bane, " The Organizational Problem." V. O. Key, op. cit., pp. 219-221. Robert T. Lansdale, Elizabeth Long, Agnes Leisy and Byron T. Hippie, The Administration of Old Age Assistance (Chicago: Public Administration Service, 1939), p. 16.

136

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ORGANIZATION

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THE

SSA

command in its own name. T h e same kind of line and staff thinking also denies functional command because of the dictates of unity of command. Moreover, the special problems which functionalization introduces into decentralization are obscured when functional units are thought of as staff. These special problems which arise in decentralizing a functionalized organization result (as shown in the next chapter) from three factors: ( 1 ) the improper separation of activities when functionalizing, ( 2 ) the major operating or line nature of some functionalized units, and ( 3 ) the tendency of functionalized units to follow the dictates of specialty. While Urwick's concepts with regard to staff are important in relation to the development of extensive and complicated regional organization, they were not particularly necessary for the relatively simple regional projection of the Social Security Administration. 17 It is to be noted, however, that the addition of Community W a r Service activities to the work of the regional director resulted in the development of regional staff activities. T h e possibility of needing and developing staff in the Urwick sense might also result from the organization of the F S A on a regional basis. ADMINISTRATIVE-LINE

AND

FUNCTIONAL-LINE

F o r the most part, then, line and function decentralization sufficed for the purpose of Board and S S A regionalization, and most of their difficulties involved the problems to be overcome in this type of organization. T h e theory of line and functional regional organization, however, has not itself been precise or without controversy, for it has been influenced by typical line and staff thinking or rather " line " thinking. T h e clarification of the nature of central supervision in that kind of decentralization where all or nearly all of the central divisions are represented on the field level under general administrative authority (line and function decentralization) re17 Cf. L. Urwick, " Organization as a Technical Problem," op. cit., pp. 64-69, 72-83.

DETERMINATION

OF L I N E S OF S U P E R V I S I O N

suits f r o m the w o r k of W .

F . W i l l o u g h b y , but m o r e specifi-

cally f r o m the w o r k of M a c m a h o n

a n d Millett.

his t e x t , W i l l o u g h b y d i s t i n g u i s h e d t w o kinds of vision

137

In

1929,

field

in

super-

systems as characteristic w h e r e central divisions

were

represented on regional or local levels u n d e r a single general administrator.

T h e s e he called the u n i t a r y a n d multiple

sys-

t e m s of field supervision. U n d e r the u n i t a r y s y s t e m , " . . . the line of authority r u n s f r o m these d i v i s i o n s ( o n the field l e v e l ) 1 8 to the officer in c h a r g e of the field station a n d f r o m him to the central office at the seat of the g o v e r n m e n t . . . the head of the field

station is placed in complete c h a r g e of the activities of

his station and the d i v i s i o n h e a d s

( o n the field level)

19

are

his s u b o r d i n a t e s . " U n d e r the multiple s y s t e m , " . . . the line of authority

runs direct f r o m the division head t o the head of

the corresponding division in the central office . . . the station is looked upon as an a s s e m b l y of units w h i c h a r e only loosely held

together

for m a t t e r s

of

a u t h o r i t y of the h e a d of the

general station.

administration

by

the

20

18 Explanatory parenthesis mine. 19 Explanatory parenthesis mine. 20 W . F. Willoughby, op. cit., p. 156. Note that in this volume the term multiple decentralization has been used to indicate generally that kind of organization where central units are represented on the field level under general areal command. T h u s the term multiple decentralization distinguishes this kind of field organization from those situations where units of a central organization a r e decentralized singly and independently. As a type of multiple decentralization, S S A regional organization, in this volume, has been called multi-program decentralization because the main constituents represent separate and distinct p r o g r a m s rather than the functionalization of one undertaking. T h e Willoughby formulation appears to have been accepted by the Brookings Institution in their comments on the regional organization of the Federal Security Agency and on a proposed Department of W e l f a r e although there is considerable hedging in the direction of " duality of command." See T h e Brookings Institution, Functions and Activities of the National Government in the Field of Welfare, Task Force Report on Public Welfare, Appendix P, Report of the Commission on Organization of the Executive Branch of Government ( W a s h i n g t o n : Government P r i n t i n g Office, January, 1949), PP- 14-15. 51-52, I70-I73-

I38

R E G I O N A L O R G A N I Z A T I O N O F T H E SSA

Macfnahon and Millett in their book, The Administration of Federal Work Reliej, have pointed out that in reality there is no such thing as unitary command over the field where functional units have been decentralized under overall administrative authority. They have noted that in addition to the administrative line, there are always functional lines of command running out to the field. Macmahon and Millett show the necessity for the recognition of a dual supervision of the field, that of the functional line and that of the administrative line. The supervision of the functional line is limited to that which is technical and exists with the permission of and under the general command and coordination of the administrative line. But it is nonetheless real and important. The authors note that it is not sufficient to allow the technical heads at the center to maintain contact with those in the field so long as the relationship is " purely consultative and advisory." The relationship must involve technical command; it cannot be solely advisory. Only by avowing such duality of command will it be possible to effect line and function decentralization rather than decentralization by simple uncoordinated function. Only by avowing such duality of command in line and function decentralization will it be possible to avoid the conflict of line and function (often concerned with specialty), that is, the tendency on the one hand to insist on unity of command and on the other to pull off on tangents in pursuit of specialized interests, jeopardizing overall objectives because of guild temper. 21 It should be clear at this point why the present writer objects to calling line and function decentralization line and staff decentralization. Under customary line and staff theory, the 21 Arthur W . Macmahon et al., op. cit., pp. 244-248 and especially pp. 244-246, 265-268. In paraphrasing the authors' ideas, the present writer has taken considerable liberty with terms, converting their concepts to his terms. In trying to avoid the dogma of customary line and staff thought the authors plead for an enlarged concept of staff to include operating functional units. Thus they tried to avoid the dogma that staff does not command. See their book, especially at pp. 245-246.

DETERMINATION

OF L I N E S

OF S U P E R V I S I O N

I39

22

functional or technical bureaus could not exercise command over their representatives on the regional level. Such representatives could not be responsible for their jobs under the general command of a regional administrator. They could only advise and consult. The full import of the theories of Macmahon and Millett, however, indicate that perhaps the maintenance of the term line and function is undesirable since it retains one part of the old concept " line and staff." The point is that in reality there is no such thing as total or unitary line command. The terminology administrative-line and functional-line is perhaps better since it recognizes the reality of functional command and the non-totality of line command. In the SSA there were in reality three grades and lines of command over the regions, the general administrative line running from the Commissioner to the regional directors, the program lines from the program bureaus to their regional representatives, and the functional lines from the functional bureaus to their regional representatives. The program bureaus represented distinct jobs and were not functionalizations of any one particular undertaking. Of course, it is possible to call the program bureaus and the functional bureaus technical bureaus and thus to distinguish between only two kinds of command to the field, that of the administrative line and the technical line.23 The fact that the " line " so-called is never total or complete in its authority is at times difficult to grasp. But the comprehension of this fact is necessary to the understanding of SSA field organization. Writing in the Public Administration Review, Millett has emphasized how general command is not total or unitary. During the war, the Army Service Forces were organized into nine service command areas in the United 22 The term technical is used broadly to indicate that which is other than general, overall, or administrative. Practically all functional divisions of a task are in this sense technical. But it should be noted that although the program bureaus of the S S A have not been considered by the writer as functional, they may be appropriately termed technical. 23 See n. 22

supra.

I40

REGIONAL ORGANIZATION

OF T H E

SSA

States. At headquarters were the technical services of quartermaster, engineers, medical, transportation, chemical warfare, etc. The general line of command ran from the commanding general of the A S F to the commanding generals of the service commands, to the post commanders. Technical lines of command ran from the technical services of quartermaster, engineers, medical, transportation, chemical warfare, etc., to corresponding personnel on the service command and post levels. The commanding officers on each level exercised general supervision over the technical services.34 Technical supervision was real, and no general commander would think of interfering with it. In fact, Millett notes " that commanders of troops have been relieved of their command because they refused to accept the advice of their own specialists on certain technical matters." 25 Speaking of another situation, Urwick says, when describing the duties of a supply officer, " But he is under the technical control of the superior officer of his service in the higher formation. The commander of his formation, for instance, would not dream of interfering with him over questions of method or the internal economy of his own functional units." 2® The extent to which the administrative-line need not be total or unitary can also be seen in those situations where the duties of the functional representative overshadow those of the generalist. Where the nature of administrative and functional authority it not understood, the arrogance and presumption of the functional specialist in such situations are aften matched by a mistaken idea of the general commander as to his field of operation and the content of his role. Social workers and some 24 John D. Millett, " The Organizational Structure of the Army Service Forces," Public Administration Review, IV (Autumn, 1944), pp. 220-290. 25 John D. Millett, " Field Organization and Staff Supervision," op. cit., p. 115. James W. Fesler is of the opinion that Macmahon and Millett only rationalize functional dominance which Fesler claims they really accept. See James W. Fesler, Area and Administration, pp. 78-85, 93-94. 26 L. Urwick, " Organization as a Technical Problem," op. cit., p. 67.

DETERMINATION

O F L I N E S OF S U P E R V I S I O N

I4I

students of administration were afraid of the role of the regional director of the S S A at the outset because they thought that his authority included the running of public assistance on the regional level. In the National Labor Relations Board, for example, the work of the regional attorney loomed large in the activities of the regional office. This was true because N L R B activities were hotly contested in the courts, and the whole independent regulatory process was cast in the legal and judicial framework. In the N L R B the regional director was the " administrative head " of the regional office and was the designated representative of the Board in his area. The regional attorney was administratively responsible to the regional director and technically responsible to the assistant general counsel of the trial section of the legal division. Yet the regional director could not issue a formal complaint to hold a hearing in an unfair labor practice matter or a notice of hearing in a representative case without the assent of the regional attorney. 27 John D. Millett has outlined a situation where the specialist's role overshadowed that of the general commander and has demonstrated the solution through the proper understanding of the nature of the administrative line. The case involved the general hospitals of the Army Service Forces. Millett has pointed out that a station hospital was an army post under a post commander responsible to the commanding general of a service command. Much of the work in a hospital was similar to that of an ordinary post supporting the training of troops in the United States. Like all other posts the hospital had problems in the operation of utilities, the maintenance of physical plant, the running of a post exchange, the utilization of prisoners of war, the hours and pay of civilian employees, etc. The post commander did not interfere in things medical. The competence of the medical staff was determined on the next 27 National Labor Relations Board, Field Manual (Washington, D. C . : T h e National Labor Relations Board, 1943), sections 1.1.41, 1.1.42, 1.2.42, I-3-43- (Processed.)

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geographical level by the chief surgeon of the service command. If he found something wrong, he corrected it in the name of the commanding general of the service command. And it was the Surgeon General who decided finally whether service commands and posts were doing competent medical jobs.28 In conclusion, then, it can be said that the administrativeline official has general command in accordance with a particular frame of reference, which is related to the general organizational scheme. His command is never total or complete. Where functional divisions are extensive in number or highly technical in content, or both, to just this extent administrativeline-command will be more general and less intensive. GENERAL COMMAND IN MULTI-PROGRAM DECENTRALIZATION

The problem of the nature of general command, however, is more complex when the regional organization is multi-program in nature, that is, involves more than one basic objective. In such situations what shall be the relation of the regional commander to the different program units and to their specialties? Donald Stone has said on this subject, " Unity of command presents no problem where the field office is carrying out a unified purpose 29 program like the WPA, 8 0 the Wage and Hour Division and the Veterans Administration; here you can readily place a regional or a state office under the full direction and authority of one person. But the problem becomes more difficult as you get into multiple purpose agencies like the War Production Board and the Federal Security Agency." Stone qualifies this position to some extent by stating, " Nevertheless, the correlation of activities in the field is necessary to 28 John D. Millett, " Field Organization and Staff Supervision," op. cit., pp. 109-113. 29 The term unified purpose is perhaps undesirable. It is difficult to speak of any organization as having a single purpose. Cf. Herbert A. Simon, Administrative Behavior (New Y o r k : The Macmillan Co., 1947), pp. 30-32. 30 Macmahon, Millett and Ogden indicated the complicated burdens on general command imposed by the varying and technical functional divisions.

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some degree. The responsibility of regional offices in achieving this correlation will vary greatly according to the extent to which activities or agencies comprise a single or a multi-purpose program." 81 This statement would seem to indicate that unless unity of command can be achieved, effective command will lie only in the various constituents. It would appear to the writer that Stone has over-emphasized the difficulties of multi-program decentralization under general administrative-line authority. In a sense, as demonstrated above, the problem of the areal general commander is not one of unity of command or of placing a regional office " under the full direction and authority of one person." Talk about unity of command perhaps results from line and staff thinking as already discussed. The solution is to admit duality of command, that which is technical and that which is general. General command does not mean all-inclusive command, that is " full direction and authority." This type of thinking which Macmahon and Millett suggest for resolving the problems of line and function decentralization will also serve for the execution of multi-program decentralization. The great difficulty is in defining the realm of activity of the general commander, his frame of reference for supervision. This is less difficult, of course, in organizations like the Works Progress Administration, the National Youth Administration, or the Forest Service, where there are relatively single tasks of work relief, relief for the young, and the care and preservation of forests and attendant benefits. In such organizations the divisions at the center and their field counterparts result from the functionalization of one basic job. The frame of reference of the regional commander may be specific rather than general. His command may be more intensive, more detailed, more unitary. As in the case of the 31 Donald C. Stone, " Washington-Field Relationships," Washing tonField Relationships in the Federal Field Service (Washington, D. C . : Graduate School, U . S. Department of Agriculture, 1942), p. 16.

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Forest Service, common professional training may increase the capacity of a regional forester to supervise the regional functional representatives. In multi-program organizations the command of the area administrative head must be more general, more limited, and more carefully defined as to its limits. However, it is altogether feasible. Millett has demonstrated that the complex specialties and programs of the Army Service Forces were tied together centrally, regionally, and locally under general command which had the responsibility of supporting the training of troops in the United States. 32 Macmahon has demonstrated how functional divisions inside the State Department and even programs outside of the Department were placed under the general areal command of the Foreign Service. The frame of reference for command in the case of each activity was State Department policy with regard to any given country. s s Separate programs may be placed together under a single field administrative head for many organizational reasons, which may then be used as a frame of reference for general areal command. For example, the programs may all be grant programs and use common specialties. In this case the general areal commander may well provide common housing and common specialties, and may coordinate relations with the states and with the public. Or again, separate and different programs in a department may deal with the same clientele (other than states) or with different natural resources in the same area. In these instances there is also an obvious role for a general area commander. Certain limitations on the decentralization of separate and different programs under general administrative command 32 John D. Millett, " Field Organization and Staff Supervision," op. cit., pp. 104, 108, h i . 33 Arthur W . Macmahon, " Function and Area in the Administration of International Affairs," New Horisons in Public Administration (Birmingham: University of Alabama Press, 1945), PP- 118-145.

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should be noted. Many departments of Government were formed by grouping constituent units which were generally concerned with some one broad subject or which had planning relations at the center. Some of the constituents of these departments, therefore, may have no significant field relationships, and they may well go their own separate way in the field except for common housing where appropriate. Nor would the concept of general regional command justify the establishment of omnibus or composite regions in the United States for all or a large number of Federal departments under regional directors commanding in terms of a "regionalist " frame of reference and guided by regional planning commissions Such a scheme would violate present political arrangements for determining policy and for locating political responsibility. Moreover, the concept of general regional command does not mean that some one major program in a department can be made the repository of general command on any field level. The concept involves command which is general and concerns overall organization objectives. Individual programs tend to follow the dictates of their own interests and should not be given general administrative authority. The value of multi-program decentralization depends for the most part on the nature and validity of the command of the general administrative heads of the field stations. In the case of the SSA, it was the role of the regional director which was significant for the success of the regional structure. An intensive analysis of this role is the burden of chapter nine. It is the purpose here to review the experience of the old Board and the S S A with regard to the definition of their regional lines of authority. At the outset there was the task of defining the authority of the bureaus over their regional representatives and the authority of the regional director over these same regional representatives. There was also the task of relating the authority of the program and functional regional representatives.

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T H E D E V E L O P M E N T OF A D M I N I S T R A T I V E ORDER N O .

XI

The field committee established by the Board early in 1936 to plan for field organization, as discussed in chapter four, began work on lines of authority at the same time that it was plotting regional areas. It would appear that the earliest thinking in the Board conceived of the regional directors as merely housekeepers for the convenience of staff stationed in the field. They were referred to during this period as regional managers. A change in thinking began with a memorandum from the field committee to all executive officers of the Board on February 1 1 , 1936 in which the committee proposed an enlarged role for the regional managers. It did not, however, envisage them as Frank Banes in embryo. Mr. Bane was then executive director of the Board. The field committee suggested that the head of the regional office be called the manager of the regional office, that he be the " general administrative h e a d " and the " coordinating head " in accordance with Board policies. He was to originate no policies and was to be responsible to the executive director. He was to have general control of public relations in his region with the informational service as his technical aid. AH communications were to flow through the regional director or, where this was not possible, he was to have a copy. All technical matters were to be under the supervision of Washington bureaus. Where there were differences of opinion between the regional manager and the regional representative, the matter was to be referred to Washington. The committee did not expect the proposed manager of the regional office to have the same degree of supervision over the field activities of the bureau of federal old age benefits as in the case of other bureaus. District offices of the bureau of federal old age benefits were to be administratively responsible to Washington and were to supervise directly the branch offices. The district office managers were to inform the manager of the regional office and the regional representative of federal

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old age benefits of their activities, itineraries, plans and procedures. 34 It can be seen that this thinking was rudimentary but it started a new approach to the role of the regional director. There was an immediate negative action on the part of the bureaus to the proposed role for the regional managers. The bureau of public assistance decided that its regional representatives would have no autonomy and drew up a plan of four super-regional areas. Its regional representatives would merely use regional offices for convenience and would not be stationed in any of them. The bureau of unemployment compensation, which had been favorable to the idea of regionalization, decided that not enough was known about the job of unemployment compensation, rapidly becoming more complicated by state variations allowed under the Act, and that, therefore, it was inadvisable to decentralize. The job might best be done entirely in Washington and, as it was learned, men could be sent to the field. The bureau of federal old age benefits planned to make the district offices and the Washington office the core of the administration of old age benefits. The regional offices would perform only the functions of inspection, training and reporting. Of the functional bureaus, only the auditors objected strenuously to the plan. The general counsel was not enthusiastic; the informational service was; and research and statistics was not clear as to its regional role, a condition which more or less became permanent. The bureau of business management expected to be represented on the regional level by the executive assistants, or as then termed, the assistant regional managers, who would be entirely business officers. This last proposal would have resulted in as much confusion of business and staff functions on the regional level as occurred on the national level. As already related, the executive assistant developed into a general staff person, and the bureau of business management was abolished and incorporated into the office of the executive director. 34 This district office system was not adopted. See chap, v, pp. 125-126.

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The bureau of accounts and audits put up a strong bid for independence. In a memorandum to the Board on April 15, 1936, Mr. Hughes, the director, started that the regional areas were constructed largely on the basis of compensables under the federal old age benefits program, whereas the auditors were concerned with the federal-state activities and could best be located in state capitals. Auditors should have no public relations and therefore needed no regional director. The value of an audit is often surprise; it would, therefore, be best not to have their itineraries known. S o far as the payroll was concerned, this could be handled from Washington as in the case of the Department of Agriculture. Back of all this was the belief that independence was necessary to the successful prosecution of the audit function. Obviously with such an attitude the auditors were bound to clash sooner or later with the program bureaus, primarily responsible for federal-state relations. On March 10, 1936, the Board adopted the field committee point of view with regard to the regional director. A s a matter of fact, it broadened the public relations role of the regional director. The Board was impressed with the seriousness of the pending job of delicate negotiation with the states to get the unemployment compensation and public assistance programs under way. Its chairman, especially, felt that the regional directors should be well known and respected personalities in their areas, with good contacts and able to represent the Board before the public. A s a result of this shift in point of view the Board decided against the appointment of persons then in training for regional managers. These persons had come mainly from the bureau of foreign and domestic commerce. It was decided to use them largely as assistant regional directors, and the Board set about getting personalities capable of representing it in the regions. About the same time, the Board decided to speed up the whole process of regionalization to avoid further political pres-

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sure. Thus on May i, 1936, it issued instructions to the first seven regional directors opening up their offices. These instructions stated that each regional director was to be the " representative of the Board in his region " and the " responsible director of all activities in his region." The regional representatives were to take instructions from their respective bureaus on all " technical matters " but were to be " subject to the supervision of the regional director " and were to be under his authority as to all matters of " state and public relations." The regional director was given the authority to make recommendations to the bureau directors as to the appointment of regional representatives and could protest to the executive director the appointment of regional representatives whom the regional director found undesirable for any reason. Washington staff members visiting in the region were required to inform the regional director of itineraries, plans, instructions and the results of their activities. Auditors were specifically instructed to do these things and to use the regional offices as their headquarters. The regional director was to coordinate the activities of the regional staff by means of conferences, staff meetings, orders, etc. The striking thing about this first description of lines of supervision was that the authority of the regional director was defined on the one hand as complete or unitary and on the other hand as limited and general. The instructions described an administrative line and a technical line of command, but also stated that the regional director should be " the responsible director of all activities in his region." The instructions did not cover the relations of the regional director to the field structure of the bureau of federal old age benefits. This was remedied in Administrative Order No. 11 of May 2 1 , 1936, which indicated that the regional representative of federal old age benefits should be subject to the supervision of the regional director and responsible to him for the effective supervision of district and branch offices within the

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region. At the same time it stated that the district offices were to communicate and report directly to the bureau of federal old age benefits and the regional representative was to examine, coordinate and report on the activities of the field offices in his region, in accordance with the policies of that bureau. The remainder of the order was the same as the instructions of May 1, 1936. The regional representatives were to be under the regional director as to " all general administrative matters " and under their respective bureaus with regard to " all technical matters." 35 On June 6, 1936, the Board issued a Social Security Bulletin to emphasize the primary line nature of the operating or program bureaus. The Bulletin indicated that the operating bureaus had the major program responsibility and that it was around them that the " staff and coordinating " services were to be coordinated. It specifically requested a reduction in the number of separate visits to state agencies on the part of representatives of the " staff " bureaus and services. The Bulletin also required twenty-four hour clearance by the executive director's office in advance of all field visits by Washington personnel.39 These instructions reflected an attempt to correct the independence of action which the functional bureaus were undertaking, as well as the uncoordinated descent of " parachute jumpers " from Washington at this formative period of the regional offices when they were not yet fully staffed. It is significant that the instructions used the word " staff " when referring to the functional bureaus. The Bulletin also outlined in detail the documents and data required of the states by each 35 Albert H. Rosenthal, " The Use of Administrative Areas by the Social Security Board " (M. A. thesis, Dept. of Government, University of Minnesota, 1939), pp. 65-69. (Typewritten.) 36 Social Security Board, Social Security Bulletin No. 5, Relations of the Bureaus and their Field Representatives to State Agencies (Washington, D. C.: Social Security Board, June 6, 1936), p. 1. (Processed.)

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of the bureaus as well as the duties and responsibilities of each regional representative in his relations with state agencies. 37 During all this time there was considerable discussion as to the role of the regional representative of federal old age benefits. O n June 10, 1936, Mr. Altmeyer in a memorandum to Mr. Latimer stated that the regional representative should have the power of supervision as well as the power to examine and report on the district offices in his region. A revised Administrative Order No. 11 on July 20, 1936, clarified general lines of authority to some extent and dealt at length with the duties and responsibilities of the regional representative of federal old age benefits. The order stated that all of the regional representatives were subject to the " general supervision and direction of the regional director," but that they were to be under the control of their respective bureau directors with regard to " all technical matters." It explained that by " the term general supervision is meant the usual or customary control exercised over a subordinate by a superior officer." 88 This explanation of the authority of the regional director was consistent. It made clear that total or unitary supervision was not within his power. But the explanation of what was meant by general supervision was lame. Experience showed later that the regional director's authority needed more precise definition. The order noted that the regional representative of federal old age benefits was to be responsible for the efficient operation, coordination and public relations of the district and branch offices. Under the regulations of the bureau he was to review, examine and report on the details of the technical matters of records, claims, wage records, etc., of these offices. Claims were to be routed straight to Washington from district offices, 37 Ibid., pp. 2-5. 38 Social Security Board, Administrative Order No. 11, Organisation of the Field Service of the Social Security Board (Washington, D. C.: Social Security Board, July 20, 1936), p. 1. (Processed.)

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and no direct relations were to exist between the branch offices and Washington except in emergencies. CRITICISMS OF T H E BOARD'S FIRST ATTEMPTS TO DEFINE LINES OF A U T H O R I T Y

There were no other revisions of Administrative Order No. II until October 1937. In the meantime there was much observation and criticism inside and out of the Board concerning the order. W a y n e Coy, writing in October 1936, felt that the explanation of " general supervision " as ". . . the customary control exercised over a subordinate by a superior officer " hardly indicated the control of the regional director over the regional representatives outlined in Administrative Order No. 1 1 . He felt that the Bureau heads certainly did not interpret it in this way, even if the executive director did. The regional directors had only the authority to recommend to the bureau directors and protest to the executive director in regard to regional appointments. T h e regional representatives were under the technical direction of the bureau heads. Coy felt that the regional director had a legitimate function as a super-negotiator in the federal-state activities of unemployment compensation and public assistance, in the job of interpreting Washington to the states, in controlling relations with the governors and legislators, and in managing public relations. But he felt that since the bureau of federal old age benefits was doing a direct federal job, the general supervision of the regional director was unnecessary. H e did admit that the regional director might keep the responsibility for the regional public relations of the bureau of federal old age benefits. 39 One wonders immediately how the regional director could effect economies if he did not have general supervisory authority. But it is true that the authority of the regional director over 39 Wayne Coy, " Organization of the Field Service," Report on the Organisation and Administration of the Social Security Board, au., Donald Stone (Chicago: Public Administration Service, 1936), suppl. to Part IV, pp. 27-31.

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the regional representative of federal old age benefits had to be different from that exercised in the case of the other program regional representatives. Donald Stone, writing in the same report, concluded that the extent of regional director authority over the proposed district and branch offices should be limited to providing personnel, accounting, legal and other " staff " services. 40 V . O. K e y , writing in 1937 of the early days of the Board, was extremely critical of Administrative Order No. 11 and of the regional relationships in the Board. H e pointed out also what he called the unsatisfactory definition of what was meant by " general supervision." But his criticism went further. A f t e r describing the regional office, he stated, " Over all of these presides a regional director as the representative of the Board reporting to its executive director in Washington. Y e t the position of the regional director is ill-defined, for the various members of the regional staff owe an allegiance to their respective bureaus in Washington." 41 This would appear to be a complete misunderstanding of line and function decentralization. K e y pointed out several instances of uncoordinated and independent action on the part of the " service " bureaus and stated that the regional director was incapable of coordination both because of his lack of training and his excessive span of control. H e stated that the so-called " service " bureaus were in fact operating bureaus, since the activity involved was one of federal-state relations and since the activity constituted a supervisory and not a straight line operation. H e came to the conclusion, therefore, that the projection of the Washington office into the field in such situations was given to confusion and that the role of the general regional administrator was undesirable, for " In dealing with a state agency, the different specialists in the field need to be under the direction of well40 D o n a l d C. Stone, Report on the Organisation the Social Security Board, p. 23. 41 V . O . K e y , op. cit., p. 219.

and Administration

of

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ORGANIZATION

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rounded administrators who can view in workable perspective all the facets of public welfare administration." *2 Although the writer cannot agree with Key's unitary concept of the nature of the administrative line, nor with his dismissal of the regional director's usefulness, it is true that the Board did not fully grasp at first the operating nature of its functional bureaus. The remedy was not to abandon its type of decentralization, but to define more carefully bureau relationships in the field as it started to do in Bulletin No. 5. In April of 1937 a revised Administrative Order No. 11 was being drawn up, but on the 26th of April the Board put off the revision of the order until Harry Arthur Hopf, the management engineer hired by the Board in 1936 and 1937, could make a report on general organization problems. Hopf was mainly concerned with the organization of the bureau of federal old age benefits, but he wrote two memoranda on the organization of the Board in general, in which he gave attention to regional organization. Admittedly, his thinking was mainly concerned with the bureau of federal old age benefits. In the first memorandum, written on May 4, he was of the opinion that the Board was over-functionalized, but admitted that in decentralization common specialties must be grouped together for economy's sake. It would have been too expensive, for example, to have had a regional attorney to service each of the program regional representatives. With regard to the regional directors, he preferred the term regional managers but was willing to make them responsible for the operating results in their regions. Hopf considered the role of the executive director confusing centrally and regionally and suggested that this officer be viewed mainly as a coordinator. He recommended that Administrative Order No. / / b e held in abeyance until overall organization had been decided.43 42 Ibid., pp. 220, 221.

43 Memorandum of Harry A. Hopf to A. J. Altmeyer, V. M. Miles and F. Bane, " The Organization Problem," pp. 2, 3 and 5.

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B y May 24, Mr. Hopf had experienced a complete change of heart or mind. O n that date in a memorandum to the Board on general reorganization, he proposed a three step process by which all of the functionalized bureaus might be abolished and their activities incorporated in the three operating bureaus. T h e executive director's office was to be abolished, and functionalized activities were to be represented for staff purposes on the Board level or in the Board's office. H e was against Administrative Order No. 11 as planned, for he felt certain that it was impossible to decentralize without doing away with functionalization, stating, " A n y plan of organization of the field service formulated without regard for the major problems of coordination of staff and line that faoe the Board is prima facie exposed to serious reservations as to its validity." 44 Hopf was mainly concerned with the complete decentralization and the independence of the bureau of federal old age benefits. H e had proposed earlier and proposed again on May 24th in this memorandum and in another the complete equipping of the bureau of federal old age benefits to carry out all of its functions and, in addition, the decentralization of the claims and accounting or record keeping activities to the regional level. 45 He suggested, therefore, that the bureaus of unemployment compensation and public assistance should carry on their activities entirely from the central offices in Washington and use the office space and facilities in the regional and field offices when making trips. This would be necessary in 44 Memorandum of H . A. Hopf to A. J . Altmeyer and V . M. Miles, " Regarding the Eventual Complete Reorganization of the Board," pp. I, 2, and 3. (Typewritten.) 45 Ibid., charts A, B and C. Memorandum of H . A. Hopf to the Social Security Board, " Steps Required to P u t into Effect the Recently Adopted Policy of the Board with Respect to the Reorganization of the Bureau of Federal Old Age Benefits." Memorandum of Leroy Hodges, Director of the Bureau of F O A B , to F r a n k Bane, Executive Director of the Social Security Board, " Proposed Organization of the Bureau of Federal Old A g e Benefits under a Decentralized P l a n of Administration," May 2 5 , 1 9 3 7 . (Typewritten.)

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view of the proposed abolishment of the functionalized bureaus, for the duplication of their services three times on the regional level would be extremely costly. T h e regional director would then be called a regional manager and would be responsible for managing the self-contained regional offices, for supervising the regional claims and accounting activities of the bureau of old age benefits, for carrying o n regional public relations, and for housekeeping. H o w e v e r , Hopf wanted the federal old age benefit activities of the regional director strictly limited. 48 O n M a y 26, 1937, the Board accepted in principle (and as it turned out for the time being) Hopf's ideas with regard to the reorganization and decentralization of the bureau of federal old age benefits, but rejected Hopf's ideas as to the general reorganization of the Board at the center and in the region. 4 7 T H E REVISION OF A D M I N I S T R A T I V E ORDER NO.

O n October 15, 1937, Administrative

II

Order No. 11 was re-

vised for the last time up to this writing. It contained the basic definitions of line responsibility and authority for the regional representatives and the regional director. It also outlined in detail the duties and activities of the regional representatives. 48 T h i s latter part w a s out of date in 1947 but the definition of lines of authority w a s still binding. Incorporating Social Security

Bulletin

No. 5, which it super-

seded, the order detailed the primary line responsibility of the operating bureaus. A l l representatives of service bureaus were instructed to coordinate their activities around the regional representatives of the operating bureaus, and the re46 Memorandum of H. A. Hopf to A. J. Altmeyer and V. M. Miles, pp. 2-4. 47 See chap, viii, pp.

204-209.

48 Social Security Board, Administrative Order No. 11, Organization of the Field Service of the Social Security Board

Security Board, October,

1937),

( W a s h i n g t o n , D. C . : Social

pp. 3-11. (Processed.)

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gional director was required to hold the representatives of the operating bureaus responsible for all state contacts. 49 T h e regional director, as in the case of previous instructions, had the authority to recommend appointees in his region to the respective bureau heads, to state his opinion and recommendation to the executive director with regard to any such appointment, and to submit a statement to the executive director as to the efficiency or suitability for continued assignment within his region of any bureau representative or other employee. 80 These powers, of course, did not apply to the regional referee. Perhaps, because of the criticism of the terms " general supervision " and " technical supervision " as explained in the Administrative Order No. / / o f July 20, 1936, the 1937 order abandoned the terms altogether and outlined the authority of the regional director rather specifically. T h e regional director was stated to be the " representative of the Board in his reg i o n , " and responsible to the executive d i r e c t o r . " " Broadly defined," the authority and responsibilities of the regional director as stated in the order were the following : ( 1 ) T o supervise and coordinate the activities of the regional representatives of the several bureaus. ( 2 ) T o give advice to the Board (later Commissioner) concerning these, as he m a y deem necessary. ( 3 ) T o coordinate and supervise all aspects of the old age insurance program through the field offices in his reg i o n and in accordance with the instructions of the bureau of old age insurance. ( 4 ) T o have all reports and instructions flow through him, except in the case of emergencies w h e r e he w a s to be informed by a copy of the instructions involved. 49 Ibid., pp. 1-2. 60 Ibid.

51 Later, of course, he was the representative of the Commissioner and was responsible to him.

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( 5 ) T o control hours of duty, leaves of absences, routes and means of travel and all other administrative matters and matters of business management concerning his regional representatives, but in a manner consistent with the work programs of the bureaus, and, if necessary after consultation with the bureau directors. Representatives from Washington were instructed under the order, as in the case of former orders, to report their itineraries and the purposes of their trips to the regional director, and to correlate their activities with those of the regional office. T h e regional director furthermore was charged to see that proper coordination was effected between " operating" bureau representatives and " service " bureau representatives, and to see that each representative stayed strictly within his own sphere of activity. 82 Certain other powers of the regional director might be noted at this point. It was he w h o gave the regional representatives their efficiency ratings and was the efficiency rating reviewing officer for assistant regional representatives. Most importantly, the original regional directors were appointed because they were persons of important contacts and influence in their regions, and these factors also gave their intra-Board activities weight and influence. A t least three of the original regional directors were persons of considerable political influence. A t the outset, the regional director appointed only the personnel connected with the housekeeping of the regional office and his executive assistant. He also approved all temporary positions. Under Administrative

Order

No.

5 of

February

1944, the regional director was given the authority to appoint all positions through grades C A F - 6 , P - i or their equivalent, upon the recommendation of the appropriate regional representative, or area office of the bureau of old age and survivors 52 Social Security Board, Administrative p. 2.

Order

No. 11 (October, 1937),

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insurance, or the regional referee. His office was also charged with carrying out the recruitment program except in the case of area offices. The appointment power, however, did not include field office managers, acting managers, or assistant managers. 53 Apparently this new personnel authority was merely a question of decentralizing business and housekeeping matters. It is equally significant to note that the regional directors did not control the regional or field budgets of the bureaus. They were concerned only with the budget for the housekeeping services of the regional office and the regional office personnel. Discussion and agitation around Administrative Order No. 1 1 did not end with its revision in October 1937. For instance as late as 1946, the regional directors asked at their conference for complete budgetary control of their regions, but without avail. Two discussions in 1938 should be noted, for they clarify certain aspects of Order No. 11. The regional directors' conference in Washington from February 14 to 16, 1938 discussed the proposal that the regional representative be made a pure staff person to the regional director who in turn would have full control over his region, subject to a flow of orders from the executive director. This was opposed by the bureau directors who saw themselves becoming mere planning and program advisors to the executive director under such organization." On June 4, 1938, upon the suggestion of John J . Corson, Frank Bane, the executive director, wrote a memorandum to all regional directors to clarify their authority over old age insurance activities. He stated that all old age insurance matters in the field office were under the immediate supervision 53 In addition it did not extend to additional in-grade promotions for meritorious service under the Uniform Promotions A c t ; to promotions of more than one grade to positions, the entrance rate of which was more than $600.00 above the employee's existing grade; to promotions of more than two grades within twelve months; nor to separations or demotions for cause. Cf. supra, chap, iv, pp. 94-95 and n. 7. 54 Albert H . Rosenthal, op. cit., pp. m - 1 1 2 .

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of the regional representative of old age insurance who was directly responsible to the regional director. The regional director, in turn, was responsible to the executive director for overall supervision and direction of all of the Board's activities in his region. Bane stated further that the executive director's office did not function directly with the regional or field offices in regard to specific matters in the province of the bureaus, but confined its activities to the supervision and direction of the regional office as a whole and to the supervision and direction of the individual bureaus in Washington as a whole. Primary responsibility for the activities of the individual bureaus lay with their directors. SUMMARY

By the beginning of 1938, then, Board policy with regard to the role of its regional offices and the authority of its regional directors and regional representatives was firmly fixed, but only after prolonged discussion and much difficulty. Part of the Board's trouble in defining lines of central supervision over the field lay in the confused nature of line and staff doctrine. In fact, the story of the Board's development of its concepts of field supervision is one of gradual escape from the tentacles of the dogma of line and staff decentralization and of unity of command. The Board finally did that which was reasonable and useful and which stood the test of operation. Its experience revealed and tested principles of central supervision over the field which will make feasible the multiple decentralization of many Federal departments and agencies. The Board's experience and what it reveals with regard to principles of field supervision, therefore, will bear summation. T H E THEORY OF C E N T R A L SUPERVISION OVER

MULTIPLE

FIELD ORGANIZATIONS

First of all, in establishing central lines of supervision over any field structure it is important to note the difference be-

DETERMINATION

OF L I N E S OF S U P E R V I S I O N

l6l

tween line and staff decentralization and line and function decentralization. The decentralization of the Board and the S S A ( a s in the case of most simple decentralizations) did not involve line and staff relationships. Line and staff decentralization is really a more complex and sophisticated form of organization than simple line and function decentralization. The latter merely involves the separation of a task into desirable divisions of work and the decentralization of these along with a central line of administrative authority. The former means the equipping of the line at the center and on other geographical levels with aides whose sole responsibility is to aid line commanders in planning, organizing, commanding, coordinating and controlling. Functionalization adds to rather than lightens the burden of command and coordination. The increase of functionalization requires the development of staff often for both line and functional organizations. Staff never commands in its own name; functional units always d o in practice. The point is that when functional units are called staff, the dogma of line and staff is often applied, and functional units are denied the right to command their subordinates on other geographical levels. T h e principle of unity of command is usually then asserted for the line, and multiple field organization is made practically impossible. Moreover, as will be discussed in the next chapter, functionalization has problems of its own which may be overlooked if line and function organization is called line and staff organization. As several commentators on field organization have shown, actual practice indicates that the so-called line or chain-ofcommand is never unitary or total. Functional command is real, and there is no such thing as a total line of command but in reality an administrative-line and a functional-line. T h e functional-line is concerned with technical supervision. The administrative-line commands in terms of a defined frame of reference which is concerned with the objectives of the overall organization and which varies by geographical level.

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THE

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Only by avowing the principle of multiple command is it possible to decentralize the functionalized units of an organization together under general administrative command on any given geographical level. But going further, the fact that the so-called line is never unitary, but is general and operates within a definite frame of reference makes possible the decentralization of separate and different programs under one general administrator on any given field level. In such cases, that is, in multi-program decentralization, the frame of reference for administrative-line command will usually be more general, yet more limited and precise than where the constituent units result from the functionalization of one organic undertaking. Thus the command of a regional forester over his regional representatives might well be more detailed and complete than that which was exercised by the regional director of the S S A over his regional representatives. The Significance of General Administrative Areal Command as Practiced by the Board and the SSA The understanding and practice of the concept of general administrative areal command as practiced by the Board and the S S A make possible the establishment of multiple field organization by many departments where formerly each program has been decentralized separately. All that is necessary in such situations is the adoption of the principle of multiple command and a useful and important area of command for the administrative-line. Such an area of general command may arise when the programs deal with the same clientele, objects, or area, or employ the same specialists, etc. This is not to say that wherever some kind of general areal command can be concocted it is desirable to establish multi-program decentralization. Many departments or Government agencies were created by grouping units which were related to some broad subject or which had central planning relations; therefore, some constituents of these departments may be best decentralized separately. Nor can the concept of general regional command, which

DETERMINATION

O F L I N E S OF S U P E R V I S I O N

163

represents on its level the administrative line, be used to justify the omnibus regionalization of all Federal field organizations. Such regionalization with its regional planning commissions is ancillary to lines of command and jeopardizes

present

methods of determining policy. Moreover, the concept of general command does not mean that some one major program in a department can be made the repository of general command on any field level. T h e concept involves command which is general and concerns the objectives of the overall organization. Individual programs tend to follow the dictates of their own interests, and should not be given general administrative authority. SOCIAL SECURITY BOARD E X P E R I E N C E IN D E F I N I N G L I N E S OF FIELD SUPERVISION

T h e Social Security Board was faced with the problem of determining the nature and lines of supervision over the decentralized representatives of four program bureaus and five functionalized bureaus operating under regional directors. The history of its wrestle with this problem indicates that it first thought of its regional directors as merely office managers. It then passed through a stage when it thought of its bureaus as " line " and " staff " bureaus and of the command of the regional director as total and unitary, at the same time attempting to recognize the validity of technical command. T h e confusion of thought about the scope of command of the regional directors frightened the bureaus and stimulated their hostility to multiple regional organization. Gradually during 1936 the Board moved away from thinking of its regional organization as " line and staff " organization. It began to think of its bureaus as " operating " bureaus and " service " bureaus and of the regional director's authority as involving " general administrative supervision." W h i l e it thus avowed multiple command, it erred in failing to define specifically the scope

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and nature of the command of the regional director. This it finally did in a detailed fashion in October 1937. 58 Certain failings, however, continued with regard to definition of lines of authority. The definition of the authority of the regional director was never re-defined in one administrative order after October 1937, although new authority was added and old authority was refined as is apparent from a perusal of the administrative orders. Misunderstandings, therefore, did re-occur. Moreover, it was undoubtedly wrong to give the regional director the same authority over the bureau of old age and survivors insurance as he had over the bureaus engaged in federal-state activities. In practice, matters did not work out this way, for the bureau of old age and survivors insurance operated a direct federally administered program which was tightly controlled at the center. Lastly, the Board was slow in understanding that the functional bureaus were not auxiliary in the usual sense but were in reality operating. Social Security Bulletin No. 5 first made clear that the program, or, as the Board called them, " operating " bureaus had the main responsibility in federal-state matters. The relation of the functional or " service " bureaus to the program bureaus and to the regional director is the burden of the next chapter. Their supervision involved problems peculiar to functionalization in a federal-state situation, and over and beyond questions of duality of command. 55 The regional structure of the Federal Security Agency, established in July of 1948, avowed the principles of multiple command and of general regional command. It is the feeling of the present writer, however, that the authority of the new Agency regional directors was stated too generally. This applies especially to the statement that the regional director was to provide " leadership, coordination, evaluation, and general administrative supervision." See Federal Security Agency Order 16-1. General regional command should be general rather than detailed, but it should be limited as to its sphere of operation and precisely defined. See chap, iii, n. 31, pp. 84-86. Cj. The Brookings Institution, loc. cit.

CHAPTER VII T H E D I F F I C U L T I E S A N D ADVANTAGES OF FUNCTIONALIZATION P A R T of the problem of establishing the orderly supervision of the field was solved for the Social Security Board once the principles of multiple command and general command were understood and applied. There remained, however, those difficulties of field supervision and of relations between regional representatives which were caused by the functionalization of the Board. Of course, before the problems of functionalization could be recognized, it was necessary to grasp the fact that Board decentralization was line and function decentralization rather than line and staff decentralization.

Functionalization was undertaken by the Board partly as a means of providing for the regional decentralization of its programs in an economical fashion. If the Board had not developed the functionalized bureaus and representatives, it would have had to equip each program representative separately with the specialties provided by the functional representatives, or it would have had to provide these specialties by travel out of Washington. Both methods would have been expensive. Of course, it must be admitted that there were some difficulties experienced by the Board and the S S A with regard to the provision of an economic work load for some of the functional regional representatives, but these were overcome. While functionalization raised technical problems of field supervision, of relations between program and functional regional representatives and of work load for functional regional representatives, it was on the whole a desirable method of organization. Without it the cost of regional decentralization would have been prohibitive. Moreover, as will be noted in this chapter, it had other advantages. 165

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OF T H E

SSA

ORGANIZATION

Many of the difficulties experienced by the Social Security Board with regard to the supervision of decentralized functional activities resulted from errors in conceptual thinking about the type of organization which the Board developed. It will therefore be helpful to recapitulate first what has been said earlier, especially in the second chapter, concerning the definition of the terms functional, functionalization, and specialty, and concerning their use in the description of the organizational units of the Board and the S S A . 1 In the field of organization the word function can be used in at least two ways. 2 In this book, it is used in reference to a division of work. Any undertaking may be organized into basic divisions of work and these divisions may then be termed functional divisions. In this sense the line throws off functions horizontally as opposed to its division vertically in hierarchical groupings. 8 The process of the horizontal division of any undertaking may be called functionalization. Generally speaking, when an undertaking is organized into appropriate divisions of work, two kinds of functional divisions may be noted, those which are operating and those which are facilitative or auxiliary. It is the former which usually present problems of field supervision. Operating functional units enjoy technical command over their field counterparts, and this command must be related to administrative-line command. If care is not taken in establishing operating functional divisions, it may be found that there is overlapping of responsibility among the divisions or that some activities have been omitted altogether in the process of separation. The so-called " operating " bureaus of the S S A — t h e bureaus of employment security, public assistance, old age and survivors insurance, and the children's bureau—did not repre1 See supra, chap, ii, pp. 40-41 and n. 8, pp. 41-42. 2 Cf. L. Urwick, The Elements of Administration, 3 Cf. J . D. Mooney & A. C. Reilly, op. cit., p. 25.

pp. 47-48, 56, 60-61.

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sent functional divisions of the job of social security. They were in reality individual undertakings with essentially different and more or less unrelated programs, 4 except that all but one were administered on a federal-state basis. Of course, these bureaus were all concerned with providing some kind of security or relief to individuals, but this was true of many agencies of Government and was hardly a basis for considering the bureaus as divisions of a single task. In order to indicate that they constituted separate programs and because other bureaus of the SSA were also operating, the so-called " operating " bureaus might better be termed program bureaus. The bureaus which were termed " service " bureaus—the informational service, the general counsel, the bureau of accounts and audits, the state technical advisory service and the bureau of research and statistics—were, in fact, the only functional bureaus of the SSA. They were formed by the splitting off of certain common activities from each of the program bureaus and therefore would have been properly called functional bureaus. These common activities happened to be specialties, that is, recognized subjects for concentration in training and work. The fact that the functional bureaus were concerned with specialty was not distinctive, for the same was true of most of the program bureaus. Perhaps the most deceiving thing about the functional bureaus, especially when it came to determining the supervision of their regional representatives, was the fact that while these bureaus appeared to be auxiliary in nature, since they dealt with specialties common to auxiliary activities, they were for the most part directly operating bureaus. It is true that, with the exception of the state technical advisory service, they performed auxiliary services on both the central and regional levels for the SSA as a whole and for the bureau of old age and survivors insurance, but with regard to the federal-state programs, the functional bureaus, like the so-called " operating" bureaus, were performing directly operating activities. 4 W. L. Mitchell, " Washington-Field Relations in the Social Security Board," op. cit., pp. 35, 36, 38.

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BOARD PROBLEMS W I T H

OF T H E

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FUNCTIONALIZATION

R E L A T E D TO F I E L D S U P E R V I S I O N A N D TO BETWEEN REGIONAL

AS

THEY

RELATIONS

REPRESENTATIVES

It will be remembered that in the beginning the old Social Security Board was composed of the three program bureaus of unemployment compensation, public assistance, and federal old age benefits (later old age and survivors insurance), and of the five functional bureaus of accounts and audits, business management, research and statistics, general counsel, and informational service. Moreover, the state technical advisory service, in reality an additional functional bureau, was soon organized. This was extreme functionalization, and the history of the Board was one of moderate retreat from it. A t the very outset the functionalization of the Board was challenged by its management engineer, Harry Arthur Hopf. The resulting controversy clarified the basic problem involved in the Board's

functionalization.

It was

simply this:

the

abolishment of functionalization of course would have resolved the problems of coordinating program and function both in the field and at the center, but it would have made the cost of the decentralization of the Board prohibitive. In a memorandum to the Board on May 24, 1937, entitled " The Eventual Complete Reorganization of the Board," Hopf proposed a three-step reorganization with the third phase resulting in the elimination of all of the functional bureaus. Hopf admitted that his plan would mean that the regional representatives of public assistance and unemployment compensation would have to be serviced by research, informational, legal, merit system and auditing personnel, traveling out of Washington. T h e bureaus of public assistance and unemployment compensation were too small for each to afford these specialties on the regional level. Under the Hopf proposal the regional director was to be replaced by a regional manager who would direct a totally regionalized bureau of federal old age

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l6g

benefits 8 and would supply housing and housekeeping services to the regional representatives of public assistance and unemployment compensation. Hopf felt that it was impossible to develop a satisfactory field organization unless the functionalization of the Board was abolished; otherwise the problems of coordinating " line and staff " (i. e., line and function) would be impossible. Frank Bane, the executive director of the Board, did not agree with the Hopf proposal of May 24, 1937. In reply Bane stated that the bureaus of public assistance and unemployment compensation were too small to justify their o w n specialties on the regional level, and that Hopf did not present estimates of savings or of additional costs. By way of analogy Bane noted that it was certainly cheaper to run one rather than three libraries, purchase and supply units, press services, etc. On May 26, 1937, the Board suggested that Hopf work on the decentralization of the bureau of federal old age benefits, but in effect rejected that part of his memorandum of May 24, 1937 which proposed a retreat from functionalization. 4 The controversy over functionalization made clear that without the organization of the functional bureaus, the regionalization of the bureaus administering the federal-state programs would be practically impossible. These latter could not support the cost of providing individually the necessary specialties on the regional level. Y e t , the provision of specialist service through travel from Washington also would have been costly. A t an earlier date, on M a y 4, 1937, H a r r y Arthur Hopf himself had recognized this fact. 7 5 H o p f s federal old age benefit regional office would have encompassed all claims settlement and accounting work. In 1942, area offices were established to handle all claims work not performed in field offices, but accounting operations remained centralized. 6 " Memorandum of Frank Bane t o the Social Security Board," M a y 26, 1937. (Typewritten.) " Memorandum of M. Mulliner on the Social Security Board Meeting of May 26, 1937." ( T y p e w r i t t e n . ) 7 Memorandum of H a r r y A . Hopf to A . J. Altmeyer, V . M. Miles and F. Bane, " T h e Organization Problem."

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Nevertheless, because of the burden which functionalization placed on coordination, friction developed between the functional and program bureaus both at the center and on the regional level. The most significant clashes involved the bureau of research and statistics and the bureau of accounts and audits, and resulted in the transfer of certain activities from these bureaus to the program bureaus. DE-FUNCTIONALIZATION

When the bureau of research and statistics was established, it proposed an extensive program which included both basic and operational research. Basic research dealt with the whole problem of and need for social security programs in the United States and with the nature, method, development and financing of new social security programs. Basic research on existing programs covered problems and methods of financing; the nature, adequacy and improvement of coverage; the economic effect of coverage, of benefits, and of methods of financing; and plans for the general improvement of current programs. The operational research of the bureau of research and statistics dealt with the needs of the " operating " or program bureaus. The regional representatives of research and statistics were responsible for providing a large part of the operational research for the representatives of the federal-state program bureaus and for the state agencies. Operational research included the establishment of methods and procedures for state compliance with the statistical and reporting requirements of the Social Security Act; the collection, compilation and analysis of state statistical reports; and the development, analysis, and testing of state administrative procedures. Moreover, in the early days of the Board, the bureau of research and statistics and its regional representatives were called on to make studies and to advise on almost any problem, including those of administrative procedure, coverage, benefit formulae, eligibility formulae, work load, experience rating, actuarial forecasts, and the like.

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It soon became apparent that the program bureaus had many operating problems which required extensive research and close application by persons who were continuously in contact with operations. T h e bureau of research and statistics tried to fill this need by detailing personnel to the program bureaus. T h e individual regional representatives of the bureau of research and statistics found that it was almost impossible for them to do expert research in the multitude of different problems referred to them by the t w o federal-state program bureaus. There were complaints that the regional representatives of research and statistics advised and assisted state agencies in the installation of records and statistical procedures which had not been fully considered 8 and which would not supply the data needed by the federal-state bureaus. The de-functionalization of research and statistics really began in the second year of the Board when the bureau of federal old age benefits established its own analysis division. In 1938, a study by Donald Stone advised modifications in functionalization. In an earlier study, in 1936, Stone had stated that the centralization of " staff " functions in the service bureaus was a " sound plan of organization." 9 In the 1938 study he concluded that where the centralization of " staff " activities in central " staff " units did not provide more technically qualified service than would result by decentralization in line units, such " staff " activities might be properly transferred to line units. Transfer to line units might also be made where " staff " units did not aid the chief executive in the management of line functions. 10 Stone suggested that certain aspects of research should be closer to operations, and proposed that the research activities which were concerned with operating, administrative, and procedural problems should be transferred 8 V. O . Key, op. cit., pp. 2, 9, 220. 9 D o n a l d C. Stone, Report on the Organization Social Security Board, p. 5.

and Administration

of the

10 D o n a l d C. Stone, Organization Problems of the Social Security Board, with Special Reference to the Bureau of Unemployment Compensation, p. 3.

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compensation. 1 1

to the bureau of unemployment This was done in February, 1939. 1 2 In 1 9 4 1 , the bureau of public assistance got control of research activities by transfer from the bureau of research and statistics. 1 3 T h e shift in research activities had its repercussions on regional organization, for the bureau of research and statistics lost its regional representatives. T h e task of doing specialized operational research for totally different programs as well as the volume of w o r k requested by the program bureaus had proved too difficult f o r the individual regional research representatives. A f t e r the abolishment of the position of regional research and statistics representative, the bureau of public assistance added a regional research consultant to its regional staff. H e was placed under the " general supervision and program leadership " of the regional public assistance representative, and under the " technical supervision " of the research and statistics division of the bureau of public assistance. T h e bureau of employment security did not provide its regional staffs with research personnel, and the transfer of the employment service to the W a r Manpower Commission in 1942 deprived the bureau of the regional research load that would justify research representatives. T h e r e w a s still the need on the regional level for operational research w o r k with the states and for the supervision of state statistical reporting, but for the time being the creation of a regional research post by the bureau of employment security had to await the return of the employment service. T h e bureau of accounts and audits experienced clashes with both the bureau of unemployment compensation and the bureau of public assistance, but its controversy with the latter 11 Ibid., p. 4. 12 Social Security Board, Fourth

Annual

Report of the Social

Security

Board (Washington, D. C.: Federal Security Agency, 1940), pp. 136, 137. 13 Agency O r d e r N o . 29, Transfer Within the Social Security Board of Certain Activities from the Bureau of Research and Statistics to the Bureau

of Public Assistance (Washington, D. C.: Federal Security Agency, June 30,

1941). (Processed.)

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was the more serious. The bureau of unemployment compensation felt that it should receive by transfer a considerable amount of the work being done by the bureau of accounts and audits in the establishment of fiscal and accounting systems for state agencies. In his 1938 study Donald Stone suggested that the accountants who were doing such work should be placed in the bureau of unemployment compensation. 14 A l though this was done, these men were utilized in the bureau's fiscal standards section. Constructive accounting work continued to be carried out by the bureau of accounts and audits. The controversy which developed between the bureau of accounts and audits and the bureau of public assistance concerned the auditing of public assistance payments and was both heated and prolonged. Beginning in 1935 and lasting through 1939, the bureau of accounts and audits made an audit of all public assistance payments. The audit went so far as to include the public assistance cases themselves and the question of whether the person who received the payment from the state was actually eligible. The first of these audits was all-inclusive, but later ones were made on a test-check or sample basis. T h e first audit, which was exceptional in the United States grantin-aid process, was later justified by the Board and the bureau of accounts and audits as an information gathering expedition to uncover the nature of public assistance administration in the United States. The bureau of public assistance, however, resented the process of having regional auditors examine a state's case files on questions of eligibility. It felt that this was a job for social workers. Furthermore, the bureau believed in gradually leading the states forward by an educational process and by suggested standards which were interpretative of the Social Security Act. The bureau felt that the emphasis should be on the development within the state of proper social work and public welfare administration as a whole, and not on catching the 14 D o n a l d C . S t o n e , Organizational Problems of the Social Security Board, with Special Reference to the Bureau of Unemployment Compensation, p . 4.

174

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states on badly or illegally handled cases. It felt that the snooping and policing approach ruined federal-state relations and jeopardized the bureau's developmental approach. The educational approach of the bureau of public assistance caused it to refrain from the adoption of mandatory standards in interpreting the Social Security Act. The bureau of accounts and audits found this especially irksome in matters of business management, and it pressed for standards in this field. In the meantime it continued to carry out its audit of cases and to make disallowances not only in terms of state and federal law but also in terms of the state plan. The bureau of accounts and audits was not alarmed because of developing frictions and refused suggestions that the bureau of public assistance take over the case audit, arguing (in reply) that an audit was of no value unless carried out by an independent agent. Part of the trouble came from the fact that when the first audit was made, the bureau of accounts and audits all but ignored the bureau of public assistance. In the field the regional public assistance representative was ignored with regard to the approach to the state, the audit exceptions, and the auditor's report. The public assistance regional people could hardly contain themselves as they watched the " honesty zealots " stirring up trouble in their field of federal-state relations. Commenting on the strained relations, Mr. Banning, the director of the bureau of accounts and audits at this time, quoted the following characterization of the auditor: " The typical accounttant-auditor is a man past middle age, spare, wrinkled, intelligent, passive, non-committal, eyes like a codfish, polite in contact, but at the same time unresponsive, cold, calm and damnably composed as a concrete post, a human petrification without a sense of humor. Happily they never reproduce and all of them who die finally go to hell." 15 The Board took two steps to correct the friction between the bureau of public assistance and the bureau of accounts and 15 Social Security Board, Regional Directors Conference, Sept. 12-17, W i . (Washington, D. G : Social Security Board, 1938), p. 228. (Processed.)

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audits. First, it provided that after January 1940, the auditors of the bureau of public assistance were to begin their audit with the certification of payment. Under no circumstances were they to examine the case files of a state in order to review the judgement of social workers in granting assistance payments. The bureau of public assistance, on the other hand, was authorized to make an administrative review of state and local public assistance agencies. 18 A n essential part of the administrative review, which was carried out by the regional public assistance staff, was an audit of assistance cases. This audit was on a sample or test-check basis and was made against the standards in the Social Security Act, the state plan, and generally accepted social work standards. Disallowance resulted only when the requirements of the Social Security Act were violated. T h e purpose of the case audit was to provide basic, objective data in a complete administrative review of state public assistance administration. The aim of the review was to examine the state's work helpfully in terms of the best public welfare principles and in terms of the goals set by the bureau of public assistance and by the state. 17 The second step which the Board took to smooth relations on the regional level between the bureau of public assistance and the bureau of accounts and audits was to outline the responsibilities of the regional director and of each of the regional representatives of the t w o bureaus at every step in the process of making and considering the fiscal audit. Thus, in Administrative Order 49 it was provided that the time of the fiscal audit was to be arranged by the regional auditor with the public assistance representative and the regional director. If the latter objected, the audit was to be postponed and the bu16 During 1946-1948 the administrative review w a s temporarily suspended. It was restored in a somewhat different fashion in 1949. 17 Kathryn D. Goodwin, "Administrative R e v i e w in Public Assistance," Social Security Bulletin, V I (October, 1943), pp. 5-16. For a different point of view on the social audit, see Robert T. Lansdale, " S o m e Observations on the Federal Audit," The Social Service Review, X I I (September, 1938), pp. 440-450.

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reau of accounts and audits informed of this fact by its regional representative. All audit exceptions were to be reviewed by the public assistance representative. If he objected to any disallowance and the regional auditor failed to concur, the matter was to be written up by the t w o and referred to their bureaus, where it was settled or referred to the executive director. MINOR PROBLEMS OF D E F I N I N G T H E

FUNCTIONAL

AREA OF OPERATION

The clashes of the federal-state program bureaus with the functional bureaus of accounts and audits and of research and statistics involved major questions of the functional sphere of action. There were also minor frictions and adjustments between the federal-state program bureaus and other functional bureaus, notably the state technical advisory service and the general counsel. With regard to the latter, the federal-state program bureaus complained that the regional attorneys often advised on legal and legislative matters without proper clearance with the representatives of the program bureaus. 18 The complaints were to the effect that matters of policy and of program were often involved in legal questions. But after the initial frictions and some education of the Board's lawyers the regional attorneys fitted smoothly into the regional operation. When the state technical advisory service first made its appearance as an important organization in 1939, there were several sources of friction between it and the federal-state program bureaus. First, the program bureaus complained of the deadlines set by the state technical advisory service for state compliance with merit personnel system standards. T h e argument ran that the vigorous enforcement of these deadlines disrupted good federal-state relations. The bureau of public assistance, especially, felt that the state technical advisory service by wielding a big stick was wrecking the educational approach to the administration of federal-state programs. Second, both of the federal-state program bureaus felt that 18 V. O. Key, op. cit., p. 220.

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classification and compensation plans were parts of the overall state plan for administrative organization, which was under their jurisdiction. Third, by the time of the creation of the state technical advisory service, the bureau of employment security had already established business management standards covering some personnel matters as, for example, salary, leave regulations, promotional rules and travel regulations. The bureau felt that its regulations on these subjects were necessary to insure the honest use of the 100% grant for the administrative costs of unemployment compensation. Much negotiation was necessary between the bureau and the state technical advisory service to define areas of responsibility. Third, the determination of examination materials and the establishment of job qualifications were also sources of friction between the federal-state program bureaus and the state technical advisory service. Repeated differences on the above and other matters strained relations so badly that at one time the state technical advisory service complained that its regional men were being bypassed, and the bureau of public assistance demanded full responsibility for all state merit system legislation affecting public welfare administration. 19 But the difficulties between the state technical advisory service and the federal-state program bureaus were usually not severe, and no major adjustments were required. After the initial clashes, good relations were established by a careful definition of responsibilities and the process of gradual adjustment. C O M M E N T ON T H E C L A S H O F PROGRAM A N D AND THEIR

FIELD

FUNCTION

SUPERVISION

The Causes It would appear that there were three basic causes for the frictions which occurred between program and functional representatives and for the difficulties involved in their supervi19 Cf. Social Security Board, Executive Directors Conference ton, D. C . : Federal Security Agency, December, 1940), (Processed.)

(Washingpp. 10-19.

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sion. T h e first was the improper removal of activities from the program bureaus to the functional bureaus. Basically, the functional bureaus were created by collecting certain common specialties from the program bureaus and organizing them into bureaus on the basis of subject. Proper separation is always difficult in creating functional divisions of work. It is more difficult when decentralization is involved, for what appears to be a logical separation at the center may not stand the test of operation in the field. Thus, it is clear that the fiscal audit of the bureau of accounts and audits should never have included an examination of public assistance cases to decide if eligibility had been properly determined. T h e audit for eligibility got into questions of social case work and out of the field of fiscal audit. It is also clear that the Board made a mistake in functionalizing operational research. T h e needs of the program bureaus and representatives for research on the operating problems of state programs and agencies and the volume of research requests from the program bureaus and representatives created a research load which was too specialized and too large for a general research person, such as the regional research representative. T h e second cause of the frictions between the federal-state program bureaus and the functional bureaus lay in the wellrecognized centrifugal tendency of specialty to follow the dictates of its own profession instead of complying with central direction. T h e auditors of the Board and S S A were a good example of this tendency of specialty. A s auditors they had been trained to believe that the very validity of the audit function depended on independence and impartiality, as director Banning's characterization of auditors revealed. W h e n it was first proposed in February 1936 that the regional auditor, along with the other regional representatives, should be put under the regional director, the bureau of accounts and audits replied that auditors needed no public relations and no one to prepare the way for them with the state. The essence of the audit was secrecy and often surprise! The audit manuals

FUNCTIONALIZATION

I79

warned regional auditors against personal involvements with state staff members and instructed them in proper impartial behavior. The auditors felt that it was perfectly justifiable to audit public assistance cases for eligibility since the standards for eligibility were in the Social Security Act. They suspected that the bureau of public assistance was willing to wink at a little dishonesty in order to pursue a policy of " educating " state agencies. Of course, all save one of the program bureaus were concerned with recognized specialties and utilized other specialties. All the blame for the specialist attitude cannot be put on the functional bureaus. For example, the bureau of public assistance and its regional representatives were righteously determined to protect the tenets of good social work and of public welfare administration from the encroachments both of the functional bureaus and the regional director. It must be admitted that the insistence of the functional bureaus upon following the dictates of their own specialties was a source of contribution as well as a source of friction. The state technical advisory service immeasurably improved the administrative efficiency of state agencies by improving their personnel standards. It was the bureau of accounts and audits which taught first the bureau of unemployment compensation and later the bureau of public assistance the nature and value of satisfactory fiscal and business management standards. The value of the work of the accountants in constructing state accounting systems cannot be denied. The third cause of friction between the functional bureaus and the federal-state program bureaus lay in the fact that in their federal-state work the functional bureaus were operating rather than auxiliary in nature. This was true even though they were concerned with specialties commonly handled by auxiliary units. At the outset the Board did not grasp fully the operating nature of its " service" bureaus and failed, therefore, to provide a clear definition of lines of authority running out to the field.

l8o

REGIONAL ORGANIZATION

OF T H E

SSA

V . O. K e y , writing in 1937, noted that the " service " or functional bureaus were just as supervisory of state activities as the " operating " or program bureaus. H e came to the conclusion that while line and function decentralization was permissible in a straight federal operation, it was undesirable where an undertaking involved federal-state relations and was essentially supervisory. In expressing his opposition to Board regional organization, K e y stated, " The situation is partly due to the newness of the organization, but more fundamentally it constitutes a projection of the Washington office into the field. . . . Auditing, research, statistics, law and personnel—usually conceived of as overhead services—are as much operating services as are those technically akin to the aided activity such as social work. . . . T h e adoption of the internal relationships of an operating department, the attitudes associated with those relationships, by a supervisory unit, such as a grant administrating agency, tends to create a multi-headed agency to deal with states. . . . In dealing with a state agency, the different specialists in the field need to be under the direction of wellrounded administrators w h o can view in a workable perspective all the facets of public welfare administration. . . . The problems are essentially the same as those of any federal agency which administers a direct federal undertaking through field services. The internal divisions of the headquarters office in such an agency, however, may be projected into the field without grave consequences, but in dealing with a state agency a federal organization must deal with it as a unit." 20 While K e y ' s point adds clarity to the understanding of relationships, it is difficult to see how the grant-in-aid supervisory relationship precludes line and function decentralization. The coordination of the administrative-line and the functionalline is equally difficult when the operation is direct instead of supervisory, as was shown in the case of the W a r Production Board. 2 1 In a military operation, if the services fail to supply 20 Ibid., pp. 220-21. 21 Cf. G. M. Goodrich, op. cit., pp. 212-214.

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" line " troops on time and in the correct amount and type of supplies, the result is as disastrous as the snarling of federalstate relations. And the service outfits of the army make decisions of far-reaching importance to the success of the " line " operation, such as those pertaining to armament, medical service, or legal service. But it is fair to note that there is a certain coordination which comes about when functionalized units operate directly on the end product or result. The situation at the point of production itself causes a unity of operation by the various activities. The end point of production is removed one step when the activity is supervisory. The remedy in a supervisory activity which is functionalized appears to lie in the careful coordination of program and functional units, and in the recognition of the primacy of the program-line by any officer responsible for this coordination. The Board did recognize the primary importance of the " operating " or program bureaus early in its existence. It has already been noted that Social Security Bulletin No. 5 of July 6, 1936, stated that the "operating" bureaus had the major program responsibility and that the " service " bureaus were to be coordinated around them by the regional director. But it takes a long time for organizational principles to be assimilated. Moreover, there was not sufficient support from the top or from the regional directors in establishing the primary authority of the operating bureaus. Thus as late as 1938, Donald Stone had to advise that the direct contact of the service bureaus with the states without clearance, both from Washington and the regional level, should stop. He also cautioned that all personnel out of Washington dealing with states should clear with the appropriate regional representatives.22 22 Donald C. Stone, Organisation Problems of the Social Security Board, pp.

12,

14-

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The Solutions Gradually relations were perfected between the program bureaus and the functional bureaus through the careful inculcation of organizational principles, and through the adjustment of and the precise outlining of responsibilities between the bureaus. The primary responsibilities of the program bureaus were safeguarded as the relationships of the regional representatives to each other were carefully outlined in administrative orders and manuals with regard to all operations and responsibilities. Where differences could not be resolved on the regional level, there was provision for an orderly and controlled referral of the controversy to Washington. In any conflict each representative was allowed to prepare and refer his own point of view.28 PROBLEMS OF WORK LOAD IN THE UTILIZATION OF THE FUNCTIONAL REGIONAL REPRESENTATIVES

The difficulties which the Board experienced with regard to functionalization were not in vain, for without functionalization, the cost of regional decentralization would have been prohibitive. If the functional bureaus had not been established, the program bureaus would have been forced to acquire specialist services by one of two expensive arrangements. One would have required each program bureau to provide its own regional attorneys, regional informational specialists, regional 23 It was indicated in chapter iii, note 31, pp. 84-86, that in 1948 all audit and personnel work for the federal-state programs of the Federal Security Agency were transferred to the office of federal-state relations of the Agency. See Agency Order 5. By September 1948, no instructions had been issued which plotted the exact area of responsibility of the office of federal-state relations in making its audits or in carrying out its merit system personnel work. A check on the developments in 1949 revealed that there had been considerable clash between regional auditors of the office of federal-state relations and the regional representatives of the Public Health Service and of the children's bureau. This is surprising in view of the fact that experiences of the Social Security Board and the SSA should have been a proper guide to those persons establishing the new Federal Security Agency field organization. Cf. The Brookings Institution, op. cit., pp. 15, 51-52, 172-173.

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auditors, and regional personnel methods consultants. The other arrangement would have provided for the servicing of regional program bureau representatives by specialists traveling from Washington or some other central point. But it must be admitted that although the functional bureaus were established to provide regional specialist services in an inexpensive manner, the economic utilization of the functional regional representatives was often difficult because of the variation of their individual work loads in both quantity and quality. This was true especially of the regional attorney and the regional research and statistics representative. The regional attorney had an adequate work load in the early days of the Board when the federal-state programs were getting started and were in a state of flux. But as these programs became stabilized, there were fewer questions as to legal or legislative matters. In 1939, survivors claims were added to the old age insurance program, and in 1940, the program began to pay benefits. Thus, for a while, the regional attorney's work was stimulated by the increase of his old age and survivors insurance claims work. But he was soon without a sufficient work load in those regions where the old age and survivors insurance load was light. Moreover, the war brought a general drop in all old age insurance claims. It was in part in order to remedy his work-load situation that the responsibilities of the regional attorney were enlarged to include the servicing of the regional representatives of the Office of Vocational Rehabilitation, who were housed in the regional offices of the Social Security Board in 1943. In addition, during 1946-47, Region X I I of the Board was experimenting with an arrangement by which the regional attorney handled the legal work for the Food and Drug Administration. The failure of the regional research representatives resulted in part from the inability to solve work-load problems of both quantity and quality. When the State of New York comprised one region, the regional research and statistics representative did not have enough work, for he had only one state to service

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and a state which was itself adequately equipped for research purposes. On the other hand, in a five state region where state research staffs were poor, the regional research and statistics representative was swamped with work. But it was the nature of the research work load which presented the greatest problem. The demands of the two federal-state programs for operational research required more specialized capacity than a general regional research person could be expected to possess. A s has been said, this was the factor which caused the transfer of the operational research function to the program bureaus. But it should be noted that the transfer resulted in the loss of a regional research and statistics service for the bureau of employment security, for after the transfer of the employment service to the War Manpower Commission, the bureau alone did not have the work load to justify its own regional research people. T w o circumstances beyond the control of the S S A also affected the proper utilization of the functional representatives. When the children's bureau was transferred to the S S A in 1946, it kept its own accounts and audits unit which, operating out of Washington, served the regional representatives of its social service division and of its division of health services. The regional auditors and their staffs and the regional personnel methods consultants could have serviced the children's bureau's representatives much more efficiently and at less travel cost. The bureau, for instance, was unable to provide a personnel review such as the regional personnel methods consultants performed for the other S S A federal-state programs. 24 In fact, according to one source, the accounts and audits unit of the bureau was three years behind in its work. 24 It was reported that the chief of the children's bureau received a Presidential commitment that her bureau would remain intact when it was transferred to the Federal Security Agency in 1946. This was provided in Agency Order No. 57, Commissioner of Social Security (Washington, D. C.: Federal Security Agency, July, 1946). (Processed.) In 1948, however, all personnel merit system work and all auditing work with state agencies were transferred to the office of federal-state relations of the Federal Security Agency. See Agency Order 5.

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The second circumstance which hampered the S S A in the utilization of the functional bureau technique was provided by Congress. In appropriating for 1947-48, it abolished the informational service. The S S A was forced to shift the information work to other shoulders, specifically those of the regional director and the regional representative of old age and survivors insurance. They managed the best they could. T h e work of informing workers and employers of their rights and duties under the old age and survivors insurance program had to g o on. C O M M E N T ON T H E ECONOMIC UTILIZATION OF T H E FUNCTIONAL

REPRESENTATIVES

When specialties which are organized into functional units are provided in the field to service program units, problems of providing satisfactory work load for such functional units can be expected. They will have peak periods of usefulness, but this is also true of the program units which they serve. Generally, if like specialties are organized together into functional units and if there are a large number of program units, it will be easier to provide a satisfactory work load for decentralized specialties. It should be remembered that Congress is hostile to certain activities, such as research, planning and public relations. W h e n these are prominently organized into functional bureaus, they will in all probability be attacked by appropriation committees. It should not be overlooked that the work-load problem for decentralized functional units, whether or not they are concerned with specialty, is related to the proper delineation of area just as in the case of the program units. In multi-program regional organization, the delineation of regional organization is already difficult. But quite often it is possible to allow one functional regional representative to serve more than one region. This was done before 1940 in the case of some regional research and statistics representatives. Generally, the

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larger the regional area, the easier it will be to provide an adequate work load for decentralized functional units of a service nature. T H E ADVANTAGES OF

FUNCTIONALIZATION

In spite of the difficulties of functionalization, the Board and its successor, the SSA, not only solved the problems but also enjoyed the advantages of functionalization, of which four were significant. First, it should be remembered that without functionalization it would have been too costly to supply many specialties on the regional level. Second, by lumping the specialties into the functional bureaus, it was possible not only to reduce costs but also to increase efficiency and service. Groups of specialists acting together were able to provide services which they could not have produced if they had been scattered through the program bureaus. For example, the merit system reviews and the examination research and test construction work of the state technical advisory service could not have been carried out by personnel experts organized in small units in the program bureaus. The same observation is also true of the work of the bureau of accounts and audits in developing state accounting systems. Third, functionalization made it possible for the Board and the SSA to provide impartial supervision of the states. A state charged with violation of federal requirements was not subject to the bias of a single bureau and its regional representative, for it was under the supervision of several bureaus and their regional representatives. One bureau reviewed legal conformity ; another, fiscal accountability and honesty in transactions; another, conformity with program and administrative standards ; and still another checked the presence of political " spoils " or other violations of personnel standards. Thus, the Board, and later the Commissioner of the SSA, had available data from several sources when considering questions of state conformity with the requirements of the Social Security Act. In addition, the functional bureaus and their representatives

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served as an independent source of data by which the effectiveness of the work of the program bureaus and their representatives with the states could be judged. Fourth and last, the organization of the functional bureaus made it possible to subject the states to one set of requirements in regard to any specialty. If the functional bureaus had not been formed, it is quite possible that each of the program bureaus might have established different requirements as to accounting or merit system administration. Quite to the contrary the state technical advisory service established uniform personnel standards and promoted joint merit system councils in states. It was the bureau of accounts and audits which exerted pressure to bring the business management standards of the bureau of public assistance into line with those of the bureau of employment security. CONCLUSION

As a method of organization functionalization proved to be of value to the Board and the SSA. In conclusion, therefore, the techniques by which the problems of functionalization were solved or controlled will bear summation. Matters of work load were solved by the adjustment of area or by the acquisition of work load from related organizational units. The problems of the relations between the program bureaus and the functional bureaus and the problems of field supervision caused by functionalization were solved by six methods. First the primacy of the program bureaus was recognized in federalstate matters. Second, the technical command and contributions of the functional bureaus were recognized and accepted as concepts of field supervision were grasped and as mutual respect developed. Third, the role of the regional director in coordinating program and functional regional representatives in their relations with the states safeguarded the primacy of the program line and insured the utilization by the program representatives of the contributions of the functional representatives and their bureaus. Fourth, the scope of functional

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operation was carefully adjusted to safeguard the program bureaus' main responsibility for federal-state relations and to equip the program bureaus with those services which needed to be tied closely to operations. Fifth, the responsibilities of the program and functional representatives were carefully plotted in administrative orders for all major operations. Sixth, as will be seen in the next two chapters, the general development of the techniques of clearance, coordination, communication and control was helpful in ordering the relations of program and functional bureaus and their representatives.

CHAPTER VIII BASIC TECHNIQUES OF CLEARANCE AND COORDINATION: ADMINISTRATIVE ORDERS AND FIELD UNITS E F F E C T I V E techniques of clearance, coordination, communication and control are necessary in any field projection. T h e problems involved, however, are more complex in a multiple decentralization which employs three kinds of lines of command—program-line, functional-line, and general-administrative-line. For these two reasons a review of the experiences of the Board and the S S A will prove instructive.

Administrative orders and field units are discussed in this chapter as being respectively procedures and organizational units basically concerned with questions of coordination and clearance. The techniques of communication and control are discussed in the succeeding chapter. Of course, it must be admitted that the procedures and organizational units discussed cannot be neatly classified under the processes of clearance, coordination, communication, and control. The processes themselves are not mutually exclusive. Thus, coordination is not possible without control, nor control without coordination. 1 Obviously, field units discussed in this chapter under clearance and coordination existed also for purposes of control and for clearing communications as well as for other matters. Similarly, administrative orders were also a technique of control since they plotted jurisdictional responsibility and authority. In short, in the ensuing description, techniques have been classified according to their main characteristics. 1 Cf. John M . G a u s & Leon O . W o l c o t t , Public Administration and the Department of Agriculture ( C h i c a g o : Public Administration Service, 1940), p. 290. 189

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E A R L Y BOARD E X P E R I E N C E S IN M A T T E R S OF C L E A R A N C E , COORDINATION,

COMMUNICATION

AND

CONTROL

Administrative planners for the Board recognized that its multi-program, functionalized decentralization would place a heavy burden on clearance, coordination, communication and control. It will be recalled that the very first memorandum the regional director received on M a y i , 1936 required the clearance with the regional director of all personnel visiting the field. One of the responsibilities of the regional director's executive assistant, as his position was described in M a y , 1936, w a s to guard the clearance of the bureaus with regard to material flowing to Washington and t o the states. 2 Moreover, during the first t w o years of operation, field divisions were established in the executive director's office and in each of the bureaus. F o r instance, the field division of the executive director's office was established in October

1936 with exceed-

ingly tight field controls. T h e field divisions were established to g u a r d over the movement of data and persons t o and f r o m the field and to insure proper clearances. Y e t the Board experienced at the outset the same ignoring of clearances which all new organizations face, and which result both from intent and ignorance. 8 " Flying squadrons " or " parachute jumpers " descended on the regional offices and proceeded to instruct and aid states. Press releases were regularly given out in Washington which caught the field flatfooted and which often dealt with local matters such as the opening of field offices. 4 T h e extensive functionalization of the Board in the early days made things all the more difficult. T h e Board was not aware of the specialized organization, effort and care necessary to control and coordinate its field activities. 2 Cf. Social Security Board, Temporary Field Manual. 3 Cf. Raymond C. Atkinson, The Federal Role in Unemployment Compensation, p. 24.

4 Cf. W. D. Carey, op. cit., p. 36 and G. M. Goodrich, op. cit., p. 211, for parallel experience in the War Production Board.

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In 1938, Donald Stone pointed out that the regional representatives were being ignored by persons traveling out of Washington, including persons from their own bureaus. 5 H e suggested that every bureau be equipped with a field division to coordinate communications and personal contacts with the field and to serve as a general field management unit. He also suggested a complete reorganization of the field division of the bureau of unemployment compensation into a division of operations. 6 In 1938, Anna M. Rosenberg, the regional director of Region II, complained that requests for advice on proposed and pending state legislation were intolerably delayed by the processing through the various bureaus at Washington. 7 A s late as 1939 she complained of conflicting technical direction flowing from Washington to the states, of uncoordinated action on the part of the general counsel and the bureau of accounts and audits in Washington, and of the by-passing of the regional offices by the bureaus. 8 Eveline M. Burns also commented that central clearance of instructions and persons achieved only limited success in the Board's case and that states were burdened with a multiplicity of requests and instructions often of a conflicting nature. 9 For the most part, the Board solved its clearance, coordination, control and communication problems. Some of the first attempts were cumbersome. For instance, for a long time regional offices received a copy of all communications written by anyone in the central organizaton to any state official, public or private organization, or person in the geographical area of the region. Most of these letters were routine answers to inquiries, 5 Donald C. Stone, Organisation Problems of the Social Security p. 12.

Board,

6 Ibid., pp. 12, 18-21. 7 Social Security Board, Executive Director's Conference (Washington, D. C.: Social Security Board, September, 1938), p. 9. (Processed.) 8 Social Security Board, Executive Director's Conference (Washington, D. C.: Social Security Board, July, 1939), pp. 64-65. (Processed.) 9 Committee on Long Range Work and Relief Policies, op. cit., p. 481.

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and the burden of sifting this mass of carbon sheets fell on the regional office. In late 1940, the field division of the executive director's office asked for a copy of all materials flowing to the states from each regional office. This, of course, would have duplicated most of the material flowing from the regional representatives to their respective bureaus, but the request was successfully resisted by the regional offices. The field division did require for considerable time the clearance of all the travel to the regional offices, a matter which was finally turned over to the various bureaus. A s late as 1947 a correspondence section of the coordinating and procedure division of the Office of the Commissioner reviewed all outgoing mail for clearance, policy and form. T h i s section had a huge file of precedents and worked till late at night clearing the day's mail. This was a responsibility which could have been decentralized to the bureaus, which should have been cognizant of policy by 1947. The solution of the Board's and the S S A ' s clearance, coordination, communication and control problems came through the step by step outlining of all major operations in the administrative orders ; through the establishment of field divisions and clearance procedures; through the work of the executive assistant in the regional offices, already described; through numerous conferences and extensive training; by careful programming and, to some extent, by inspection and reporting; and by extensive manualization of instructions and the systemization of other communications. A s late as 1947, however, manualization was certainly not complete in the case of the bureau of public assistance and the children's bureau. ADMINISTRATIVE

ORDERS

S S A administrative orders, a procedure which dated from the early days of the old Board, outlined the basic structure, organization and duties of the various organizational units and outlined step by step the basic operations which the S S A was organized to administer. Thus Administrative Orders, Nos. 2, 3, 4, 11, 13, 20, 21 and 4Q outlined the complete

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processing of plans, certified state plan material, progress memoranda on state conformity, state legislation, budgets, grants, expenditure reports and budget reports. On the regional level these orders stated the major and minor responsibility of each regional representative with regard to each activity. Each program bureau representative was instructed as to which other bureau representatives were to be notified in any given action and the number of copies of the particular action to be furnished such representatives. The orders also outlined the time limits for regional action. Not only did the administrative orders state the major and minor responsibilities of the regional representatives, but they often gave a careful description of the shadings of responsibility between program and functional bureaus. For example, in regard to the submittal of state plan material for public assistance purposes, Administrative Order No. 2 stated, ". . . the State Technical Advisory Service will be primarily responsible for reviewing all plan material relating to merit systems of personnel administration. The Bureau of Public Assistance will be responsible for reviewing such personnel plan material in its administrative aspects and with regard to appropriate qualifications for personnel employed in social work positions." 10 The administrative orders also outlined carefully the role of the regional director in coordinating the program and regional representatives in each operation and the steps to be taken when there was disagreement between these representatives. For example, it was usually provided that the date for a personnel methods review or a fiscal audit of a state should be agreed upon mutually by the program and functional representatives involved, and failing this, the regional director was to set the date or postpone the whole matter. In certain types of actions it was provided that the regional director should prepare the way with the states. Where program and functional representatives disagreed over any matter, as for example in 10 Social Security Board, Administrative

Order No. 2, p. 3.

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the case of audit exemptions or the findings of a personnel methods review, the whole problem was discussed with the regional director. If agreement was not reached, both representatives were instructed to justify in writing their points of view and refer them to their Washington bureaus. F o r action on the national level, the administrative orders served the same purposes as on the regional level. They outlined the responsibilities of the bureaus for every major operation. They stated the kinds of Commissioner and bureau actions to be taken in different situations, the procedures to be followed in case of differences between bureaus, the number and distribution of forms and dockets flowing from the field or resulting from varying bureau or Commissioner action, the time periods allotted for all actions, and the place of final deposit of various actions. In summary it can be said that the administrative orders were a technique for clearance, coordination, and control. They provided control through the careful plotting of responsibility in all actions and through directing and timing the flow of all major operations. They stated the responsibilities of all coordinating officers and the points at which coordination would be necessary. They outlined the necessary clearances and the time and points at which such clearances should be taken. FIELD U N I T S PURPOSE

Generally speaking, the field units of the SSA cleared and coordinated all communications moving out to the field. Not only did they coordinate communication but they developed a promotional role with regard to it through their arrangement of center-field conferences. The field units exerted control through the inspection of the field and the review of reports. Control was also the aim of their administrative and business management duties although the element of service to the field was also present in these activities.

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PROBLEMS

A s a result of the S S A type of regional organization, the Office of the Commissioner and each one of the bureaus or divisions of a bureau represented on the regional level had a field unit. Speaking in organizational terminology, some of the field units had the status of division; others were sections; and others were only units. 11 Since there were so many kinds of communication flowing to the field through so many field units, the field division of the Office of the Commissioner was assigned the responsibility for overall clearance, coordination and control of communication and for safeguarding the main channel of communication. However, except for the difficulty of controlling the varied lines of communication flowing to the field, S S A field unit problems and techniques were not different in any special manner from those usually encountered. T h e most instructive problem experienced by the S S A in regard to field units involved the degree to which any such unit could draw to itself some portion of the basic activities of the bureaus or divisions which it served. It was in this regard that the experiences of the bureaus of old age and survivors insurance and of employment security were informative. T Y P E S OF FIELD UNITS

T h e Federal Security Agency had no headquarters field organization, not even for general liaison work or regional research and planning, at least none that performed these activities. T h e field units of S S A fell into four types. T h e field units of the Commissioner's Office, of the bureaus of employment security and public assistance, of the general counsel's office and of the social service division of the children's bureau were managerial and liaison organizations for the purposes of clearing instructions and other communications flowing to the field; of devising, receiving, consolidating and analyzing pro11 The term field unit is used generically in this volume except where it must be used as a part of an official title, as is the case of the field unit of the state technical advisory service.

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grams and reports; of preparing conferences; of aiding in the business management of the field; and of inspecting the field. T h e field unit of the informational service and the bureau of accounts and audits had some substantive activities in addition to the usual managerial and liaison duties. In addition to management and liaison activities, the field section of the division of health services of the children's bureau and, to a lesser extent, the field division of the bureau of old age and survivors insurance had substantive direction of a main portion of their overall organization's job. Lastly, the field unit of the appeals council, that is, the office of the consulting referee, had complete direction of the main task, which was a field job uncomplicated by functional units. It should be noted that in small outfits such as the state technical advisory service, the informational service, and the appeals council, business and managerial matters were likely to be handled centrally for the whole activity. CRITICAL DESCRIPTION

OF T H E SSA FIELD

UNITS

T h e field division of the Office of the Commissioner served as the staff aid to the Commissioner in all of his dealings with the regional directors. It was responsible for the business and administrative management of the regional offices, and it controlled centrally many of the business services which the regional offices afforded the regional representatives. One of its main duties was to clear and coordinate all communications flowing to the field from the various bureaus. In 1946, it began to review the overall operating programs and reports of the regional directors. In the area of business and administrative management, the field division of the Office of the Commissioner reviewed the budgets and made allotments for the regional offices, that is, for the regional director, the executive assistant, the stenographic, business and clerical staff, and for space, heat, light, supplies and other administrative services. T h e bureaus all had separate budgets for their regional personnel other than cler-

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ical and stenographic personnel and for their own travel. T h e field division maintained a central reserve of funds from which regions with special problems could draw. T h e budget was flexible except that personnel was allotted on a line-item basis after time and function studies had been made. T h e field division provided general supervision over the personnel matters of the regional office, but after February 1944, final determination with regard to positions through C A F - 6 and P - i was in the hands of the regional director. The most significant duty of the field division was its clearance and coordination of communications flowing to the field from the many bureaus. The aims of the field division in handling communications flowing to the regional officers were: to safeguard the general-administrative-line of command by making sure communications conformed with the Commissioner's policy, to ascertain that all bureaus concerned with any particular communication had been consulted, and to provide for such regional routing of a communication as would insure its reaching all persons who might be concerned. T h e main procedure employed by the field division to achieve these aims was the Regional and Field Letter, which was a composite communication to all S S A personnel in the field, with detachable sections of a specialized nature for the various bureau representatives. The field division's work with communications concerned mainly instructional material both manualized and non-manualized. Basic overall control and coordination of the establishment and content of manuals was the responsibility of the coordinating and procedure division of the Office of the Commissioner. But most field manualized material as it was issued flowed through the field division, which had the day to day job of clearing and coordinating it. All individual correspondence leaving S S A Washington headquarters was reviewed for correctness and conformity with overall policy by the coordinating and procedure division's correspondence control desk, which referred incorrect or improper field correspondence to the

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field division for handling. A s stated previously, by 1947 the whole centralized correspondence review was perhaps unnecessary. The field division had two responsibilities which concerned the content of the job being done by the regional director. In June 1946, the process of making six months operating programs and of making monthly and quarterly reports against them was required of all regional directors. The field division had the task of reviewing these programs and reports and of keeping the Commissioner informed with regard to them. The field division was also responsible for preparing the agenda for the conference of the regional directors which was held normally twice a year. The field division of the bureau of accounts and audits was to some slight extent concerned with substantive activities since it aided the finance division of that bureau in the construction of audit procedures and the audit manuals. It is difficult to see, in fact, why there needed to be a separate field division in the bureau of accounts and audits and why it was not a section of the finance division. The other two divisions of the bureau were concerned with purely internal business matters of the S S A . The field division was, therefore, serving as a channel for the activities of but one division—the finance division. For this reason and because it assisted in the substantive work of the finance division, it would have been logical to place the field division within the finance division. On the other hand, the status of the field unit in the bureau of public assistance as a section of that bureau's operations division raised some questions. This division was composed of a field section and a plans and grants section, which dealt with plan, budget and grant procedures; yet, the field section served as the liaison unit between the other two divisions of the bureau and the regional representatives as well as between the plans and grants section of the operations division and the regional representatives. The only peculiarly joint function of the two sections appeared to be with regard to the prepara-

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tion of the administrative review of state public assistance operations. Of course, it is admitted that plan, budget and grant procedures were the essence of the bureau's activity. It would appear to the writer that the field section belonged properly under the assistant director of public assistance (who was the general manager of the bureau) if it was not to have independent status. In either such position it could have assumed a proper leadership for the field in the councils of the bureau. The state technical advisory service, the informational service, the general counsel, the appeals council, and the social service division of the children's bureau had only very rudimentary field units. In the state technical advisory service, the field unit was composed of just two persons who summarized and analyzed the merit system reviews, arranged the training schedules for state persons brought in for training by the two sections of the service, and put out a news-letter to the field now and then. Clearances and field inspection were carried out by the director, his assistant and the section heads. The state technical advisory service was a relatively small outfit, but such informality as to clearances and control and coordination of the field was hardly desirable. The informational service had a direction and distribution division, which controlled the flow of communications and stocks to the field, but which also had the job of promoting informational work among state agencies and of summarizing the field reports on public attitudes. It participated in conferences held out in the field for the bureau of old age and survivors insurance or with state agencies. It handled travel allotments, but had nothing to do with field budgeting and staffing. These matters were handled centrally for the whole service, which was small. Field liaison and management activities in the general counsel's office of the Federal Security Agency were carried out in the coordination and administrative services division of that office. The only personnel of the office of the general counsel

200

REGIONAL ORGANIZATION OF T H E S S A

in the field were the regional attorneys of the S S A for whom a section of the coordination and administrative services division served as a staff unit to the general counsel in controlling budgeting, allotment and the flow of communications, and in preparing and running the conferences for the regional attorneys. The section did other legal advising and research work. Moreover, it did not serve as the field unit for the old age and survivors insurance division of the general counsel, which was housed in Baltimore with the bureau of old age and survivors insurance, and which did its own field liaison. The field liaison work in the appeals council was carried out by the consulting referee, assisted by an attorney. The consulting referee gave advice on proposed and difficult decisions upon the request of the regional referees, coordinated and standardized referee decisions, and channeled the flow of material from the field. He was truly the director of the field which was the total operation. In the appeals council, which was also a small outfit, managerial matters were handled centrally. The two divisions of the children's bureau which had regional representatives, the social service division and the division of health services, each had separate field units. The social service division had one person serving to direct the regional child welfare consultants, to coordinate their activities with those of the special consultants in Washington, to channel communication and information, to summarize field reports, to arrange regional conferences, and to review itineraries. Until 1947 the division of health services had no field unit. Under the old organization of the division, the direction, control, coordination, clearance, and management of the field took place in the director's office. The regional medical consultants, later called directors, were responsible to the director of the division. The direction of the two basic programs of the division (each under an assistant director) as well as the technical direction of the specialty units flowed through the director's office, but this office did not have a field unit of any kind. A s

C L E A R A N C E AND COORDINATION

201

a result, command flowing to the field was confused and badly coordinated. I n 1947, the division of health services was organized into a program planning section and a field operations section. T h i s latter was really an operations section, for in addition to serving as the channel for instructions and other communications flowing to the field and for the movement of consultants of the program planning section out to the states, it reviewed and controlled state plans, budgets and allotments. Moreover, the field operations section supervised the administrative methods unit, which advised states on administrative methods and techniques. A s indicated in chapter four, the field operations section supervised the regional medical directors and their staffs. T h e technical units under the program planning section were represented on the regional staff and were under the technical direction of the program planning section and under the administrative direction of the regional medical director. On the whole, the new organization of the division of health services appeared to provide a desirable pattern and one which resolved much of the former confusion. In 1 9 4 7 it remained to be seen to what degree the new field section would be able to coordinate the activities of the technical units. It was true that the regional medical directors were firmly in command of their staffs since, by training, the medical doctor who was also a pediatrician was competent to supervise most of the specialties involved. T h e bureau of employment security had an interesting history with regard to field divisions, and its problems turned, for the most part, on the question of whether a field division could have substantive authority, could, in fact, be the " line," with the technical divisions relegated to advisory or staff positions. In 1938, Donald C. Stone made a study of the bureau of unemployment compensation (later employment security) and, among other things, recommended the organization of a division of operations. At this time the funnel for matters flow-

202

REGIONAL ORGANIZATION

OF T H E

SSA

ing to the field was the grants division, which handled all fiscal matters, but not administrative matters. O n the whole, field clearance was not too well formed. Stone recommended that a division of operations be established to provide central clearance of all instructions and other communication and of all persons moving out to, or in from the field. T h e division would make investigations of state operations and practices. It would also have charge of the approval of state plans and procedures and the certification of state laws. 1 2 In describing the proposed division of operations, Stone stated, " The Division is the main line for executive action and control. The Divisions of Financial Control and Administrative Practice are principally staff aids to it." 13 He suggested further that the division could be organized on geographical lines, 14 and that it should also incorporate, in time, the activities of his proposed division of financial control, that is, matters of state grants, budgets, allotments and expenditure reports. 18 It should be noted that Stone warned that the division of operations should not endeavor to do the work of the other divisions but should rely on them for technical assistance. 18 Shortly after January 1938 a field service was established in the bureau of unemployment compensation to serve as the channel to the field, and in January 1939 this was supplanted by a division of state operations, patterned after the Stone suggestions, including even his tentative suggestions that the divisions have area men and incorporate fiscal operations. T h e new division was also given the responsibility of settling audit exceptions with the bureau of accounts and audits—an activity 12 D o n a l d C . S t o n e , Organisation Problems of the Social Security Board with Special Reference to the Bureau of Unemployment Compensation, pp. 19-20. 13 Ibid., p. 20. 14 Ibid., p. 21. 15 Ibid., pp. 22, 23. 16 Ibid., p p . 18, 19.

CLEARANCE

AND

COORDINATION

203

not suggested by Stone. 1 7 The division of state operations came into immediate conflict with the technical divisions in its attempts to answer questions flowing from the field and in its activities with regard t o state plans, procedures and the certification of state laws. It showed bad judgment on what it attempted to direct itself and what it referred to the technical divisions, and consequently it often slowed clearances instead of expediting them. Of course, it faced the continuous hostility of the other divisions. Gradually, the state operations division lost its technical people except in fiscal matters, to which its substantive activities were confined. When the bureau of unemployment compensation was reorganized because of its acquisition of the employment service in 1939, a new field division supplanted the state operations division, and its description recognized the loss of all substantive activities except

fiscal

activities having to do with plans, budgets, grants, allotments and expenditure reports. 18 The organization of the field division of the bureau of employment security did not change until the impact of the war upon employment service activities. On August 21, 1941 the field division was abolished; its fiscal activities were transferred to the fiscal and management standards division and to the regional offices; its management, clearance and coordination activities were carried up to the office of the director. T h i s movement reflected in part the increasing independence of the employment service which was carrying out the employment work for the Office of Production Management. Thus, at this time the employment service division of the bureau of employment security developed a field unit in the establishment of 17 Social Security Board, Administrative

Order No. 41, Organization

the Bureau of Unemployment Compensation (Washington, D . C . : Security Board, January 27, 1939), pp. 1-3. ( P r o c e s s e d . )

of

Social

18 Social Security Board, Administrative Order No. 41, Organization of the Bureau of Employment Security (Washington, D . C . : Federal Security Agency, A u g u s t 18, 1939), p. 3. ( P r o c e s s e d . )

204

REGIONAL ORGANIZATION

OF T H E

SSA

four area men to serve as the channel of communication to the regions and as an inspectorate; this, in spite of the fact that experience had indicated a field unit must look t o area and function at the same time. T h e other cause for the break-up of the old field division was the fact that the Office of Production Management placed final decision for most matters in the field, and the bureau of employment security therefore was forced to do likewise. A f t e r the transfer of the employment service to the Manpower

Commission,

the bureau of employment

War

security

continued to carry on its field liaison and management activities in the office of the assistant director

w h o was the general

manager of the bureau, responsible for its general direction and its administrative management,

and responsible for the

management and inspection of the field and its liaison with the technical divisions.

The

bureau

of employment

security

went so far in minimizing field liaison operations that ordinary correspondence of the functional divisions was not even cleared by the field unit. W h i l e this w a s a demonstration of what was possible once organization

patterns

became clear,

it was

a

source of friction, since mixups had t o be referred from the regional representative to the assistant director, w h o took them up with the appropriate division head. Travel continued to be cleared by the field unit. 1 9 T h e operation of the bureau of old age and survivors insurance was direct and Federal. I n 1947 the field division of the bureau supervised

12 regional

representatives

and

their

staffs, 464 field offices, 6 branch offices, 2052 itinerant stations and 13 detached field stations. A l t h o u g h the operation of the bureau was direct, the same problem of the relation of functional command t o a central field channel appeared as had occurred in the bureau of employment security, which administered a federal-state program. 19 Cf. how closely the experience of the bureau of employment security and that of the W a r Production Board coincided in the matter of field divisions. W . D. Carey, op. cit., pp. 40-42.

CLEARANCE

AND

COORDINATION

205

Within the bureau of old age and survivors insurance the field offices and their supervisors (the regional representatives of old age and survivors insurance), were entirely under the direction of the field division; yet, the field offices were carrying on work for two central activities, accounting and records on the one hand and claims on the other. The management activities of the field division in regard to the field offices were not challenged in principle, but decisions as to field office procedures aroused all the other divisions of the bureau, for their operations of accounting and of claims settlement were involved. Yet field office procedures certainly affected problems of management of the field offices. A second problem of the field division, and one common to multi-level operations, involved the tightness of control at the center and a general duplication of the supervision of the regional representatives over the field offices. The 1947 field division of the bureau of old age and survivors insurance did not differ in its essential nature from former ones. Unlike its immediate predecessor, however, it did not duplicate regional representative activity and, of course, its personnel activities were not so important because of the decentralization of personnel authority to the regional director, brought about in Administrative Order No. 5. The 1947 field division of the bureau of old age and survivors insurance was composed of a field management section, a liaison section and a field coordination and procedure section. The first two represented a dividing up of the earlier field supervision section, and the last was the successor to the precedent field control and methods section. The field management section was concerned with the planning of the location, classification and staff composition of the field offices, with the reviewing of field office budgets, with the setting of quarterly personnel ceilings for regions, including their field offices, and with the planning and analysis of field office weekly work-load reports. Work-load data and known unit time data were used

2O6

REGIONAL

ORGANIZATION

OF T H E

SSA

as a basis for all these activities. On the whole, this section had the tightest kinds of controls over the field offices and the regional representative was practically without discretion as to the staffing and budgeting of his field offices. The field management section also supervised all field training programs, prepared the conferences of regional representatives and carried on the administrative work with regard to field personnel actions. The field liaison and survey section was a small outfit composed of eight persons who supervised four geographical areas, three S S A regions to an area. Its liaison activities were concerned with examining procedures in operation and with trying to settle differences as to procedures and policy between the field offices and the divisions at the center. The main work of the field liaison and survey section was to make surveys of the field offices on specific procedures and problems which had been decided upon for survey after conference with the divisions and the regional representatives involved. The results of the inspection were not discussed with the field offices, but only with the regional representatives and with the divisions at the center. Specific field offices were not usually cited. This method of inspection was a vast improvement over that of preceding field divisions of the bureau of old age and survivors insurance. In the case of the earlier field divisions, the objective was for inspectors out of Washington to visit each field office each year (some 475 visits), to correct and instruct on the spot, and to evaluate procedures, local as well as national. The visitors also got involved in budgetary matters and in the ambitions of local field office managers for their offices. All of this, of course, was a complete duplication of the activities of the regional representative and a violation of his responsibilities. It was, perhaps, such activities plus the tightness of central controls over field offices which led Mr. Pois to observe in 1939 that the field supervision section had

CLEARANCE

AND

COORDINATION

207

confused its powers with those of the regional representatives. 20 T h e field coordination and procedure section, like the field management section, was a large outfit. It developed field office procedures for such activities of the field offices as account numbers, wage records, and claims development. It performed the liaison work with the divisions of claims policy, claims control, and accounting operations with regard to the activities and the procedures of the field offices. It also carried on liaison with the bureau of internal revenue, the bureau of employment security and the informational service. Antecedents of the field coordination and procedure section in the early days of the old age insurance program controlled the relationships with and the procedures involving the Post Office and the Railroad Retirement Board. T h e section also carried on training where procedures were involved, such as job information or work analysis, and work simplification. It was in the field coordination and procedure section, then, that the impact of the functional authority of the other divisions of the bureau of old age and survivors insurance was felt, and it was the task of this section to resolve this impact with the field division's responsibility for management of the field offices. Harry Arthur Hopf, the Board's consulting management engineer, observed in 1937 this aspect of the work of the field service of the old bureau of federal old age benefits. The field service of that date did not differ in its essential nature from the later field division. Hopf came to the conclusion that accounting and claims activities should be combined and physically decentralized to the Board's regional offices. A m o n g other things he felt this would do away with the " complicated and time consuming staff participation of separate field divisions." 21 The field service, he felt, was essentially an 20 Memorandum from Joseph L. Pois, Chief, Administrative Studies Section, to Merrill G. Murray, Assistant Director, OAI, " Preliminary Report on the Reorganization of the Bureau of Old A g e Insurance," Feb. I, 1939, P' 5- (Typewritten.) 21 Memorandum of H. A. Hopf to A. J. Altmeyer, V. M. Miles and F. Bane, " The Organization Problem," p. 5.

208

R E G I O N A L O R G A N I Z A T I O N OF T H E S S A

elongation of accounts and claims and as such it should be absorbed into a coordinated accounts and claims service.22 But the Hopf plan would have only transferred the field management problem to the regional level. Under his plan the regional offices would have had to resolve the functional demands of claims and accounts on the field offices even though claims and accounts were placed in one division. All this seems to have been overlooked by Mr. Hopf. 23 It should be stated that Hopf's main concern was with establishing the unit principle of accounting and of claims settlement and with the movement of both of these activities to the regional offices, reserving only questions of policy, procedure, inter-regional transfer of items, and coordination to the center. The Board decided to test the Hopf program. To this end it established a consolidated accounts and claims service, called the technical and control service, operating under an associate director of the bureau of old age insurance. It also organized accounting on a regional basis although the total operation was carried out in Baltimore. Claims adjudication was carried out centrally too, but on the basis of areas composed of groups of regions.24 Nevertheless, a field liaison and supervision section appeared in the technical and control service to manage the field offices and the regional representatives, since actual decentralization of accounts and claims activities to the regional offices did not take place. The problems of the field liaison and supervision section, which at first was supposed to have nothing to do with procedures, were not essentially different from those of the later field division. The field liaison and supervision section 22 Ibid. 23 Cf. Memorandum of H. A. Hopf to the Social Security Board, " Steps Required to Put into Effect the Recently Adopted Policy of the Board with Respect to the Reorganization of the Bureau of Federal Old Age Benefits." See also Memorandum from Leroy Hodges, Director of the Bureau of FOAB, to Frank Bane, Executive Director, Social Security Board, op. cit. 24 Region IV alone was given the total accounting and claims activity as a test of decentralization.

CLEARANCE AND

COORDINATION

209

also had to resolve the functional demands of the claims section and of the accounts and records section upon its management of the field offices. The fact that the outfits involved were sections of a service rather than divisions had little real effect. The Board found that the keeping of accounts according to regions was more expensive than keeping them on a consolidated basis. It therefore decided t o make accounts and records a centralized activity and abandoned the idea of a decentralized combined claims and accounts activity. W i t h this decision it returned to the idea of a separate field division. A s the bureau of old age and survivors insurance was organized in 1947, it seemed that a consolidation of the bureau's field and claims control divisions would have reduced the outside functional demands on the field division and would have consolidated field supervision on the central and regional levels. T h e claims control division provided central management for the area offices, and the field division did the same for the field offices. The claims activities of the field offices were important, and their procedures were of vital significance to the area offices and vice versa. The field division and the claims control division worked jointly on these procedures. Both had field survey and inspection staffs. Another possible advantage from the consolidation of the t w o divisions would have been the utilization of the regional representatives, and their appropriately enlarged staffs, for inspecting area offices in their regions, for surveying area office procedures, and for auditing area office work in claims adjudication review, control, and recovery. The combination of the field division and the claims control division would have involved some risk. It would have placed one main activity of the bureau of old age and survivors insurance—claims settlement—within the field division while the other—accounting—remained outside. Under such an arrangement field offices might have emphasized claims activities to the detriment of accounting responsibilities. Of course, the ac-

2IO

REGIONAL ORGANIZATION

O F T H E SSA

counting operations division and the claims policy division would have continued to make their demands on the new field division's management of field and area offices. In the final analysis perhaps the greatest benefit from a consolidation of the claims control division and the field division would have been the orderliness and the savings resulting from the consolidated supervision of field and area offices by the regional representatives. CONCLUSIONS AS TO T H E NATURE OF FIELD U N I T S

Certain tentative suggestions may be offered from the observation of the different field organizations of the SSA. First of all, multi-program, functionalized decentralization under general regional command requires the careful clearance and coordination by some overall headquarters field unit of all communication to the field. With communications flowing to the field from program bureaus, functional bureaus, and from the general commander, some central organizational unit must have the responsibility for the kind of clearance and control which will safeguard established policy, coordination, and proper routing. To these ends it is desirable to develop fixed procedures as, for example, some kind of consolidated communication and the manualization of instructional material. No single pet formula should be applied to the construction of all field units. In small operations all that is necessary is a central clearance and channel unit which may or may not carry on some promotional and management activities for the field. In such cases business and administrative management activities for the field need not be separated from the central outfit charged with such responsibilities. In such cases it would appear that substantive activities may be given to the field unit without resulting complications. Where the operation is actually and finally carried on in the field (as in the case of the appeals council) and is not functionalized, an even simpler field unit will suffice. It need be concerned only with standardization, with inter-regional coordination and with the promotion of center-field relationships.

CLEARANCE AND COORDINATION

211

Complicated field units arise when there is the need to channel the activities of a highly functionalized central organization to the field, which may or may not itself be functionalized. It would appear from SSA experience that these units should not have substantive activities except those of the most routine and standardized nature where reference to a technical unit would be merely time consuming. They should, perhaps, be limited to serving as clearance, coordination, control and management units of the field. In this regard they appear to operate best if tied high on the organizational structure in the office of the general manager of the outfit involved where they can represent the field effectively and serve all functional units equally. It is equally wrong to take the main activity of an organization and convert it into a division of operations, for emphasis changes as activities change. It is also doubtful that any functionalized activity has the necessary perspective, managerial equipment or the good will of other functional units to enable it successfully to be responsible for field coordination. The attempt to establish a division of operations out of some single activity results perhaps from the thinking (already noted in this volume) which confuses line and function with line and staff. It is an attempt to make one functionalized activity serve a9 the overall administrative-line and the other functionalized activities behave as if they were staff activities. Functionalized activity must be allowed to flow freely through field units, subject to the general coordinating supervision of top command and its staff aides, and subject to the channeling, promotional and supervisory techniques of a field management unit.

CHAPTER IX TECHNIQUES OF COMMUNICATION AND CONTROL THIS chapter, taking up the second phase of the discussion begun in the last, deals first with those techniques which the S S A employed to organize, control and promote communication to and from the field and second, with S S A techniques to exercise control over field activities. A s was indicated in the last chapter, the four processes of clearance, coordination, communication and control are interrelated, and it is therefore impossible to classify any technique as belonging exclusively to one of them. T h e techniques discussed in the last chapter under clearance and coordination also involved factors of communication and control. Thus, administrative orders were one type of communication, but they were also a procedure for insuring clearance, coordination and control. T h e field units cleared and coordinated all communications and exercised administrative and business management controls over the field as well as some program controls. In short, the aim in the last chapter and this one has been merely to classify techniques for discussion purposes on the basis of their main characteristics under the processes of clearance, coordination, communication and control. The discussion in this chapter of the Board's and the S S A ' s experience with communication involves first, the organization and manualization of instructional material (command) which flowed to the field and the states, and, second, those techniques which were concerned with developing the full capacity of the center to communicate with the field and vice versa. A s to the latter, the discussion deals with the methods used by the Board and the S S A to promote complete understanding and unity of purpose, to develop morale, and to insure a controlled reaction in the field to orders from the center. T h e discussion of techniques designed to promote center-field communication and 212

COMMUNICATION

AND CONTROL

213

understanding includes a description of the use made of house organs, conferences, training and the rotation of personnel as well as employment and promotion. Control, of course, was one of the aims of the Board and of the S S A in their efforts to develop communication and to promote understanding, unity of purpose, and a controlled reaction to central command. But for the purposes of discussion in this chapter the techniques of operational programming, reporting and inspection have been classified under the process of control. It should be noted that reports were also an important part of field-to-center communication and should be related in the reader's mind to that process as well as to control. COMMUNICATION THE MANUALIZATION AND SYSTEMIZATION OF THE FLOW OF COMMAND

Comment on Aims and

1

Benefits

The old Social Security Board was slow in organizing and manualizing the instructional material which it used for directing departmental, field and state activities. Needless to say, operations suffered badly as a result. Conflicting instructions often reached the field after improper clearance at the center. The regional representatives and the states were often uncertain which requirements were mandatory on the states and which were only advisory. It was often difficult to tell if earlier instructions were contradicted by later ones because the whole instructional area had not been physically organized. After 1939 the Board began to make rapid headway in systemizing and manualizing its instructions. A review of the aims and benefits derived from such organization of the flow of command will clarify the ensuing description of S S A organ1 Systemized reports flowing from the field are discussed later in this chapter under the process of control. It should be noted here, however, that as instructional material flowing to the field was manualized, reports and other communications flowing from the field to the center were also systemized.

214

REGIONAL ORGANIZATION

OF T H E

SSA

ized and manualized material. First, the systemization of instructional material provided for the automatic or routine clearance and coordination of any command flowing from the center to the regional level, the state level, or to the field office level. It insured the proper clearance and coordination of command flowing from the regional level to the states or field offices with that flowing from the center to these levels. Second, the systemization of instructions organized, clarified, and provided for the routine clearance of the instructions flowing from three kinds of sources—program bureaus, functional bureaus, and the Commissioner. Third, manualization and other forms of systemization facilitated the planned distribution of instructions, thus safeguarding the varied channels of command and providing for the accurate flow of command to the proper persons. Fourth, manualization organized command as to types ; it made clear whether instructions were mandatory, advisory, informational, procedural, etc. This kind of classification of instructions proved extremely important in the negotiating work of the federal-state programs. Fifth, manuals provided an equipment for all employees, and especially field employees, by which the means for the proper utilization of the total organization was always at hand, and by which any action could be taken properly and in the correct channels. Lastly and incidentally, manuals were a useful source for the training of personnel and for job orientation because they revealed the total organization of the SSA in action. Critical Description of the Manualization and other Systemization of Command The instructions of the SSA fell into two general types, those which dealt with overall SSA institutional rules and with the utilization of auxiliary services and general administrative services, and those which dealt with work instructions, that is, those which were concerned with the content of the jobs being done. Within the first type some instructions dealt only with departmental matters ; others only with field matters ; and

COMMUNICATION

AND

CONTROL

215

still others, with matters of concern to both the center and the field. The second type, or those instructions which have been called work instructions, concerned either the S S A alone, or the S S A and the states, or the S S A and the public as a whole. With the exception of the Agency Personnel Manual, which was being compiled in 1947, the instructions of the Federal Security Agency were not directly used by the S S A or its field. Federal Security Agency instructions were grouped into: Agency Orders, which outlined the basic organizations and duties of constituent units and the actions reserved to the Federal Security Administrator by law ; Agency Circulars, which made announcements and other notices of momentary usefulness; Personnel Bulletins, which made statements as to personnel policies applicable throughout the Agency; and Operations Bulletins, which dealt with Agency-wide policies and procedures on matters other than personnel.2 In 1947 the Agency began to construct an Agency Personnel Manual to supplant the Agency Personnel Bulletins and the personnel manuals of constituent organizations throughout the Agency. It was to be based on the federal personnel manual of the Civil Servioe Commission and was to be constructed by inter-leaving any special Agency policies. Similarly, the constituent organizations were to construct their manuals by inter-leaving the Agency Personnel Manual. In 1947, the Social Security Administration, on the whole, had a remarkably well organized and integrated system of manuals and communications. This had not always been the case; in fact, as will be shown, it took many years to achieve the state of organization reached in 1947. and at that time work still remained to be done on the instructions of the bureau of public assistance and the children's bureau. S S A manuals originated in the respective bureaus and in the business and management divisions of the Commissioner's 2 F e d e r a l S e c u r i t y Agency, Agency Order No. 1, Forms of Instructions of the Administrator to the Constituent Organisations ( W a s h i n g t o n , D . C . :

Federal Security Agency, June 8, 1945)• (Processed.)

2IÓ

REGIONAL ORGANIZATION

OF T H E

SSA

Office. Where the manuals in any way involved business management or inter-bureau or general activities, they were reviewed by the coordinating and procedure division of the Office of the Commissioner which also approved all manuals for conformity with Commissioner policy. This was the division which prepared the Administrative Orders. Most manualized material flowed through the field division of the Commissioner's Office and was distributed by a Regional and Field Letter. Throughout the SSA it was the general practice to enlist the field's aid in the construction of procedures, orders and regulations and to make practice runs of these before they were finally put into effect. New procedures or instructions were constantly reviewed and tested in conferences with the field. All this was especially true of the bureau of old age and survivors insurance. Many commentators have noted the value of such a procedure in general orientation, in creating acceptance to orders and in promoting field-center understanding of each other's objectives.3 The basic overall SSA communications were the Administrative Orders and the " Commissioner's Minutes." When the Administrative Orders first appeared with the beginning of the Board they included not only such fundamental material as the allocation of responsibilities and the description of the basic processes, but also matters of business management, including the smallest details. Along with the Administrative Orders was issued a Social Security Board Bulletin, which was used for general and temporary announcements, but basic organizational instructions found their way into it.4 This confusion was gradually abolished. The Regional and Field Letter, called 3 Cf. Mary Parker Follett, Dynamic Administration, the Collected Papers of Mary Parker Follett, eds. Henry C. Metcalf and L. Urwick (London: Management Publication Trust, Ltd., Camelot Press, 1941), pp. 58-59. Donald C. Stone, " Washington-Field Relationships," op. cit., p. 18. Paul C. Howard, " The Act of Communicating Washington to the Field," Public Administration Review, IV (Spring, 1944), p. 148. 4 See, e. g., Social Security Bulletin No. 5, June 6, 1936.

COMMUNICATION

AND

CONTROL

21"J

RFL, took up the responsibility for general and temporary announcements for the field, and such matters at the center were carried in a publication called Announcements. In 1939, the Board developed a Field Service Manual, and1 in 1943, a Departmental Manual; thereafter, all business management and general administration matters were withdrawn from the Administrative Orders. These Orders, which were made up in the coordinating and review division, and which dealt only with basic functions and processes, finally became models of clarity, preciseness and specificity. It had not always been this way, for at the outset many of them tended toward the inappropriate borrowing of legal jargon. 5 The other overall communication of the S S A was the " Commissioner's Minutes " sent out by his secretary. When the Board first got under way, a paraphrasing of its minutes and decisions was sent out. This was abandoned for a summary of its minutes which were, in fact, its decisions. These were distributed by the Secretary to the Board and constituted the official record of its action on plans, grants, conformity, etc. The summary, however, contained all decisions made by the Board, including those on purely internal matters. These typewritten summaries after June 1946 were sent out as the " Commissioner's Minutes." While it was perhaps not desirable to inform the staff and the field of all matters which went into policy formation and determination (for this might have been disruptive of morale and might have projected the differences and the " sides " taken at the top down into the field organization), more " i n s i d e " information for the field was desirable than was made available by the " Commissioner's Minutes." These were nothing more or less than the official decisions on matters for which he was legally responsible. It would perhaps 5 See, e. g., Social Security Board, Administrative Order No. 2, Procedure for Handling State Plans for Approval by the Board under Title I, IV and X of the Social Security Act. (Washington, D. C.: December, 1936), p. 1, para. 2 and p. 5, para. 13). (Processed.)

2L8

REGIONAL ORGANIZATION OF T H E SSA

have been desirable for the Commissioner to make some reports to the field which would reveal staff thinking and basic decisions at the center. It was quite easy for the lower echelons and for the field to fail to understand the orientation of the top just as the reverse was also true. In most organizations a small clique at the top is " in the know," and the rest of the organization wonders what is going to happen.6 Communications which dealt entirely with the central organization of the S S A were the Departmental Manual, the Social Security Office Memoranda and Announcements. The first, which began as late as November i, 1943, dealt with personnel, tTavel, communications, files, procurement, and property ; it replaced the Administrative Orders on these subjects. It also superseded that part of the old Social Security Board Office Memoranda which also dealt with business management, thus bringing together in one place all business management matters with regard to the central organization. In 1947, the Social Security Office Memoranda were seldom used except for general administrative matters, and Announcements were used only for temporary matters. Communications flowing to the field included those of an overall nature and those of the respective bureaus. The first group was composed of the Field Service Manual, the Regional Office Manual and the Regional and Field Letter. The Field Service Manual, which was begun as late as January 1, 1939, was a business management manual for the entire field—field offices, area offices and regional offices. It covered general administration, personnel, files, communications, procurement and property, public relations, space and travel. The Regional Office Manual appeared after 1942 and dealt with the business matters which were decentralized after that date for the re6 C f . Burleigh B. Gardner, Human Relations in Iudustry (Chicago: Richard D. Irwin, Inc., 1945), pp. 24, 29, 32, 38. Cf. also Otto L. Nelson, "Wartime Developments in War Department Organization and Administration," Public Administration Review, V (Winter, 1945). P- 9-

COMMUNICATION

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2ig

gional office to carry on for itself and for the area and field offices within its region. It covered personnel, payrolls, fiscal matters and travel. The manual for the regional office itself was the Field Service Manual. The Regional and Field Letter (RFL), which was a weekly consolidation of most of the general instructions and manualized material flowing to the field, began as early as July 6, 1936. It was compiled by the field division of the Commissioner's Office. All material to be sent by the RFL had to be received in this division by Tuesday morning and was sent out on Friday of the same week. The chief clerk of the regional offices and the administrative assistant of the area offices were responsible for distribution of the RFL in their offices and for the return of old manualized material. The regional representative of old age and survivors insurance was similarly responsible for the field offices within his region. The RFL was composed of lettered sections which were individually stitched or fastened, but were not fastened to each other. There was, first of all, a general section which served as a letter of transmittal, as an index of the parts of the letter, and for general instructions and information. This section was used especially by the various business management and general management units in the Commissioner's Office for temporary and immediate instructions of a general nature. It was also used by the state technical advisory service and the informational service for general instructions since they did not have enough regular instructional material to warrant a section by themselves. Then, after the first section of the RFL, there were three sections of general instructions for the bureaus of old age and survivors insurance, public assistance and employment security. The remaining sections of the RFL were the current material for the established manuals and included the Field Service Manual, the Wage Record Manual, the Field Office File Manual, the Weekly Field Office Report, the field edition of the Style Manual, the ES Staff Manual, the ES

220

R E G I O N A L O R G A N I Z A T I O N O F T H E SSA

Guide for State Employment Security Administration and the OASI Service Area Directory? All of the bureaus of the S S A did not use the RFL and those which did, failed to employ it for some instructions. Thus, the bureau of accounts and audits did not employ it, although this bureau had three well-developed manuals which could have been transmitted by RFL. The position of the bureau of accounts and audits was that it did not have a sufficient flow of regularized material. The bureau of public assistance used the RFL for general instructions and for index purposes, but did not send the actual manualized material with the letter. This was difficult to understand. Of course, up until 1944, public assistance manuals were not in shape to become part of the RFL. This was also true of the children's bureau in 1946, which did not use the RFL, and was at one time the situation in the case of the bureau of employment security. The ability to use the well-organized RFL was a good test of the orderliness of instructional material in a bureau. The state technical advisory service used only the first section, for most of its materials were policy materials and the RFL was for instructions. The bureau of old age and survivors insurance stopped' sending the Claims Manual via RFL because the manual became so bulky that under Government Printing Office cost regulations it had to be printed and could not be duplicated as was the case in RFL material. This meant that a separate letter of transmittal had to be made up for the OASI Claims Manual and filed by the regional continuity clerk, whereas formerly the RFL would have served. The Claims Manual had an index, of course, but the clerk who missed an item and was reminded of it by the index often found that the item was out of stock. The printing of the Claims Manual caused so much delay that instructions had to be sent in advance of permanent copy by 7 Social Security Board, Social Security Board Office Memorandum No. 27, Regional and Field Letter (Washington, D. C.: Federal Security Agency, September, 1943)- (Processed.)

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mimeographed Advanced Claims Items. Both of these manuals were on paper of smaller dimensions than that used by the RFL, and it was said that if they were sent out by the RFL, the difference in size of paper would complicate handling. Obviously, none of these reasons really prevented transmittal by the RFL. But if the difficulties were insuperable, the RFL could have been used as a general letter of transmittal, even though the manuals were sent separately. This would have obviated the system of making up and filing separate letters of transmittal for the two manuals. The general section of the RFL would then have been a general source of reference for all material received in the regional office. It was of real advantage in a regional office for an employee to be able to look in one spot to check on whether he was receiving all materials important to him flowing down from the center. The use of RFL should certainly have been pushed, for it had the advantages of planned distribution, of regular and scheduled communication, of economy, and of serving as a general letter of transmittal and an index. Through it, each person in the field knew that he was getting all of the instructions he should have and was able to check this by looking in one place. The RFL procedure was also a central clearance, coordination and control activity and provided, in addition, for careful editing. In the regional office it was a handy tool for the correspondence clerk to use in reminding the executive assistant of necessary actions to be taken in the work of coordination. Perhaps most important of all, it was a test of the orderliness of the instructional material of the bureaus, for they could not participate if such material was disorganized. The RFL, of course, had the disadvantage of some delay. Bureau of old age and survivors insurance materials flowing to the field included: the Claims Manual, which outlined standards and procedures for the development, review and adjudication of claims; the Wage Record Manual, which was concerned with the whole process of assigning account numbers, wage record discrepancies, scouting wage records, etc.; the

222

REGIONAL ORGANIZATION

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SSA

Weekly Report Manual, which gave instructions on the weekly work-load reports of the field offices; the Field Office File Manual; the Policy Memoranda, which were issued by the field division of the bureau of old age and survivors insurance on personnel and business management matters; and the Director's Bulletin, which was an attempt to point objectives and to exert top leadership throughout the organization. T h e Director's Bulletin, started by John J. Corson in 1941, included such things as the six months program of the bureau, progress reports, pep talks and the reports of special studies. It was a highly desirable communication in the huge, routinized operation which was the bureau of old age and survivors insurance. T h e bureau also put out a house organ which was circulated to the whole staff and which was called O A S I S . 8 The regional representative of the bureau issued memoranda on supervision and training matters to his own field offices. The bureau of employment security got into a hopeless snarl of procedural and instructional material flowing to the field. In 1940, in two separate regional offices from two different regional representatives, the writer was unable to get an explanation of which material belonged to which series. Moreover, these representatives were unable to state which of the standards being required of the states were mandatory and which were merely advisory. One can imagine what this did to federal-state relations. In 1941 when the writer was in Washington, things were in much the same condition, but in that year, with defense burdens rapidly piling upon the employment service, the bureau of employment security began to organize its instructional material. T h e bureau consolidated practically all of its instructional material affecting the states into a Guide for Employment Security Administration. This Guide was divided into four parts, each composed of t w o volumes. W i t h one or t w o exceptions, mandatory requirements and standards for the states were in 8 John J. Corson, " The Role of Communication in the Process of Administration," Public Administration Review, I V (Winter, 1944), pp. 8-10.

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volume one of each part, while suggested and advisory standards were in volume two of each part. Each part was, as has been stated, transmitted by the RFL and each transmission w a s covered by a letter of transmittal, which served as an index. T h e Guide flowed to the states as well as to the regional representatives of employment security. Part one of the Guide dealt with matters of general administration, part two with substantive program matters of state unemployment compensation, part three with research and statistical reporting, and part four with the fiscal, budgetary, and business management standards required of the states. This last section was extremely voluminous, for the bureau of employment security felt called upon to establish many such requirements because its grant to the states for administrative costs was a 1 0 0 % grant. It was the requirements and standards located in Part I V of the Guide which the auditors spent most of their time checking in auditing grants for unemployment compensation administration. T h e job of establishing the Guide for Employment Administration

Security

was not entirely complete in 1946-47, however,

for many of the old instructions still had to be used. In fact, there were twelve such miscellaneous instructions, the most important of which were the general instructions and travel and procurement standards of the old ES-501 State Agencies

Relative

to Fiscal Affairs

Grants Made for Expenses and Employment Social Security

Service

Instruction

in Connection

of Unemployment Administration,

Act and the Wagner-Peyser

to with

Compensation

Pursuant

to

the

Act.

Other instructional data of the bureau of employment security included: the Staff Manual for the entire staff, which covered the organization and functions of the bureau, business and administrative management, technique for carrying on federal-state activities, and operating instructions; the Memoranda

Series,

which carried general information and

temporary matters for the whole staff; an Outline Administrative

Staff

Review of State ES Agencies,

for

the

which provided

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for an objective administrative audit, as well as an administrative analysis, and which varied from year to year; and ES Memorandum No. 13 and related advice, which was revised from time to time, and was also called the Manual of State Employment Security Legislation. This manual was entirely advisory to the states with regard to state legislation and presented suggested language and provisions which met Federal requirements. It also included draft legislation for suggested program standards. It w a s published by the legislative unit of the legislative section of the bureau's division of administrative standards. T h e service unit of this section undertook to do tailor-made drafting for individual states, and for this purpose this central unit was organized by regional areas. T h e experience of the bureau of public assistance was not very different from that of the bureau of employment security. While instructional data never reached the same state of confusion, the bureau of public assistance for some time resisted differentiating between mandatory and suggested standards for the states. Mr. Lansdale made public objection to this as early as September 1938.® In 1947, the bureau was constructing a manual called the Handbook

of Public Assistance

Administra-

tion which would clearly distinguish between mandatory and suggested standards and would replace the then existing State Letters,

which were non-manualized instructions. In all fair-

ness, it should be said that the bureau operated in a field of hotly contested philosophies and public attitudes, some of which in 1935 were not very different from those found in the Elizabethan Poor L a w . T h e bureau sought to lead the states on and not get into the a w k w a r d business of conformity issues. A s the bureau developed mandatory program standards for state public assistance programs and administration, it was careful to try them out in the field, not only with its regional people, but also with state personnel. T h e weakness of the bureau on 9 Robert T . Lansdale, op. cit., pp. 443, 444.

" Some

Observations

on

the

Federal

Audit,"

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business, fiscal and management standards, however, was hard to understand. Other instructional materials of the bureau of public assisance included: an Outline for Review of Local Public Assistance Administration and an Outline for Review of State Supervision, which were used in the administrative review of state public assistance activities and were changed from time to time; the Bureau Circulars, which contained instructions for personnel within the bureau, including the regional staff; the Manual of State Public Assistance Legislation, which was for the guidance of the regional representative in advising on state public assistance legislation; and Suggested State Legislation, which was published yearly as a suggestion to states for model legislation. This latter was, of course, supplemented by suggestions for individual states. The bureau also sent to the field a considerable amount of informational data in an unorganized manner. The bureau of public assistance, like the bureaus of old age and survivors insurance, and of employment security, used the RFL for general instructions. Generally speaking, in 1947, the children's bureau's instructional and informational material needed manualization and systemization. T h e bureau at this time was beginning such a process. Each year the bureau published three Informational Circulars for States Agencies, one for maternal and child health services and the emergency maternity and infant care program, one for the crippled children's program, and one for the child welfare program. The first two Informational Circulars were concerned with plan material, budgets, and requirements. Separate mimeographed instructions and attached forms were distributed with regard to quarterly estimates, financial reports, statistical reports on services rendered, and progress reports. However, the Informational Circular on the child welfare program, administered by the social service division, included all instructional data, and one wonders w h y this consolidation had not taken place for the programs which were administered by the division of health services. This latter division had worked

226

REGIONAL ORGANIZATION OF T H E

SSA

out joint budget procedures with the Public Health Service because they both dealt largely with state departments of public health. The children's bureau's mandatory standards and requirements for the states were carried in the Informational Circulars; but advisory program standards were not issued in an organized fashion. In the case of the division of health services, advisory program standards were the result of advisory committees and state consultation and were issued in mimeographed form. In the case of the social service division, advisory program standards were issued by the special consultants in mimeographed form and, after testing by state experience, were printed. But on the whole, the line between mandatory and advisory standards was not so clear as this description indicates. The state merit system unit of the children's bureau issued a Recommended Standards for the Establishment and Maintenance of a Merit System of Personnel Administration and for Qualification of Classes of Professional Employees in State and Local Agencies Administering Child Health Services, Services to Crippled Children, Child Welfare Services. However, much work remained to be done on job qualifications and test construction. The state audit unit, of course, had its own audit manuals, but with regard to business management standards, these did not compare with the manuals of the bureau of accounts and audits. As for instructional data for the internal use of the regional staffs, the two field operating divisions of the children's bureau relied on rather casually related memoranda series. They did not use the RFL even for general instructions. The bureau of accounts and audits used its own memoranda for general instructions to its men; it did not employ the RFL for any purpose. Materials flowing to its regional staffs included three separate manuals for the audit of employment security funds, public assistance funds, and joint merit system

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funds. In addition, the auditors in the field were sent Part IV of the Guide for Employment Security Administration, the Public Assistance State Letters and the Handbook of Public Assistance Administration. They used these to audit for standards not included in their main audit manuals. The state technical advisory service's basic and non-serialized instructional material for the states were the Standards for a Merit System of Personnel Administration in Employment Security and State Public Assistance ( 1 9 3 9 ) and a Draft Rule for a Merit System of Personnel Administration in State Employment Security and State Public Assistatice Agencies ( 1 9 3 9 ) . The service maintained centrally and regionally a Policy Book which held a loose-leaf visible card file of Social Security Board and Commissioner decisions, precedents, and interpretations. In addition to these standards the Policy Book contained the policies which the state technical advisory service considered fundamental. In short, it served as a current manual of policies and standards and a continuing supplement to the Standards of 1939. The state technical advisory service also maintained a Manual of Merit System Administration, which described the whole job of merit system administration and was supplementary' to the Draft Rules. The Manual had a supplement, the Administration of Examination Material. Regional personnel methods consultants made periodic administrative audits of state merit systems called personnel reviews ; for this purpose they were supplied with a suggested outline for a narrative section of the review and a manual of objective questions. There was also a series known as Merit System Methods, which was sent out to the states from time to time and was concerned with information on latest methods and techniques. Technical monographs, which were designed to be stimulating, were issued from time to time. As noted, the state technical advisory service sent its regional people its general instructions in the first section of the RFL. A Newsletter, which served as a house organ, was also sent to the field.

228

REGIONAL ORGANIZATION

OF T H E

SSA

The informational service had a Public Relations Manual which, as explained, was Part V of the Field Service Manual and was distributed to all members of the SSA field staff. The informational service used a series known as Field Service Letters for instructions to its regional representatives. Of course, the service sent out a great deal of informational material covered by a memorandum of transmittal. The informational service used only the general section of the RFL to refer to its transmittals, which were transmitted separately. The appeals council sent its regional referees the following: a Referee's Manual, which had complete instructions on the entire hearing process; the manuals of the bureau of old age and survivors insurance since that bureau's procedure could be involved in any hearing; those decisions of the general counsel which applied to the states in the region of any particular referee; and the " Commissioner's Minutes." The latter were sent to every official of the SSA, of course, but were especially important in the work of the regional referee. The bureau of old age and survivors insurance supplied the regional referee with those opinions of the general counsel which it considered precedent opinions. Of course, the primary document of the appeals council was the Basic Provisions Adopted by the Social Security Board for the Hearing and Review of Old Age and Survivors Insurance Claims (1940). T H E D E V E L O P M E N T O F T H E C A P A C I T Y TO C O M M U N I C A T E , A N D T H E PROMOTION OF

UNDERSTANDING

The process of communication must employ other techniques besides the systemization of the flow of command and the procedures of clearance and coordination afforded by field units. Many factors stand in the way of the transmission of ideas from one part of an organization to another, and this is especially true in regard to center-field communication. The Board and the SSA employed several techniques designed to increase the capacity of the center to communicate with the field and vice versa, to promote understanding, to develop morale

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and to insure a controlled reaction in the field to orders from the center. The most notable of these techniques were house organs (already described), conferences, training, the rotation of personnel as well as the recruitment, employment and promotion of personnel. Conferences Conferences of center-field personnel are extremely important in the process of communication. They are expensive because they involve travel and living costs and the collective time of the participants, but they are necessary nonetheless. Conferences are a technique of instruction to supplement the written word. Important regulations involving new procedures or new organizations should not be left to the written word, which is often inexact. For complete understanding the spoken word and the opportunity to think the matter out are also necessary.10 The conference is likewise the place to take stock on how past instructions have worked out in practice, and to make adjustments for the sake of coordination. In another sense, conferences develop understanding by promoting unity of purpose, resolving differences, and stimulating morale. Thus, they provide a place where, to use Mary Parker Follett's words, the order can be " de-personalized " by showing that the order arises out of the situation. 11 This is all the more necessary in a specialized organization for, as the same author also remarked, it ¡9 practically impossible to get a person to do something contrary to his craft or professional principles unless the situation is fully explained to him.12 Once it is clear that the order proceeds from the situation, it is certainly true that fuller cooperation will be received from those responsible for achieving the objectives. Orders must be reinforced by contact and by promotion in a situation where 10 Cf. John J. Corson, op. cit., pp. 1 2 - 1 3 . 11 Miss Follett was talking about the problem of order-giving, not about conferences. See M. P. Follett, op. cit., pp. 58-59.

12 Ibid., p. 63.

230

REGIONAL ORGANIZATION

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SSA

geography and distance are involved. Again it was Miss Follett who said that the way to get people to do things is not by giving orders and exhorting, but by appealing to attitudes and creating attitudes, by providing for the release of such attitudes in action and by reinforcing such release. She also stated that the possibility of a favorable response to an order is inversely proportionate to the distance it travels down a line of command and/or geographically. 13 Burleigh B. Gardner has pointed out in Human Relations in Industry that the formal flow of communication in industry is changed by the orientation of persons resulting from their location or position in the formal structure of industry, and by group life within and outside of industry. The latter does not concern us too much. 14 With regard to the former, for instance, Gardner notes that the boss will think in terms of the company objectives, of the market, of costs, of profits, and of responsibilities to the stock-holders. However, the worker and his supervisor are oriented in such fashion that they are inclined to believe that the company is run for the enrichment of the top and that the value of their labor and of their production is not appreciated. 15 Similarly, the boss will probably receive in formal reports flowing to the top those things in which he has shown an interest or of which he approves. One tries to please the boss and is sensitive to his reactions; the result is that the boss receives filtered information.1® Mr. Gardner also notes the strain on and distortion of communication resulting from the friction which develops between functional units. 13 Ibid., pp. 52, 54- Cf. also Donald C. Stone, " Washington-Field Relationships," op. cit., pp. 9-12. 14 Cf. L. J. Henderson, T. H. Whitehead, and Elton Mayo, " The Effects of Social Environment," Papers on the Science of Administration, eds L. Gulick and L. Urwick ( N e w York: Institute of Public Administration, 1937), pp. 143-159. Cf. also F. J. Roethlisberger and W. J. Dickson, Management and the Worker (Cambridge: Harvard University Press, 1939), PP- 255-358, 379-569. 15 Burleigh B. Gardner, op. cit., pp. 56-59. 283-284. 16 !bid., pp. 24-29.

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Each member of a functional unit which is in conflict with another is careful to express the approved bias or antagonism when dealing with a member of the other unit in order to be loyal to his boss and outfit. 17 This has certainly been the case in the history of the Social Security Board and the S S A . Conferences are no specific cure for the evils of communication resulting from the orientation which comes from organizational and geographical position, but they can be of considerable aid. In the President's Committee on Fair Employment Practice, where the writer held a position, the organization was at first too cramped by lack of funds to afford center-field conferences. When the first ones were held, a most astounding amount of antagonism toward the center existed among the regional men. They were on the firing line of racial adjustment in industry, and they resented standards of performance set in Washington by " brass hats " and " arm-chair " generals. Texas was different from Washington, etc. It was a surprise to the center to find out how little of the tacking to political winds, necessary with a squall- 44, 49, Si; described, 36-9, 44, 88-93; origin, 77f.; relations to FSA, 77-88; changes in 1948-49, 84n., 8sn., 86n.; concepts of, i66f. Social Security Board, 5, 44, 49, 51; creation of, 51; organizational history, 51-8, 66f.; composition and functioning of Board itself, 52f., 57-9, 63, 81, 85; chairman of, 59, 81; abolishment, 77; functionalization of, 168-70; wartime role, 271, 28of. Social Security Bulletin, of June 6, 1936, isof., ison., 15m., 156 Social protection, division of, 73, 27if., 277, 279I Specialty, defined, 42n.; organization in the SSA, 41-4, 48, 167, 179. See also functionalization. Staff 42n., 131-36, 292. See line.

Staff bureaus, 53, »35, 15°. »63,. 171, 296. See also services; functional bureaus. State, Department of, 144 State technical advisory service, described, 38; origin and location of, 55/., s8f., 88f.; growth of activities, 65 Regional personnel consultant of, 6sf., 89!.; relations with children's bureau, 77, 82, I04f., 184; relations with Public Health Service, 83, 109; relations with regional auditor, 106; duties, io8f„ 241; reports of, 246 Abolishment and transfer, 84 Conflicts with program bureaus, i76f., 193 See also field units. Stead, William, 117 Stone, Donald, on functioning of the Board itself, 57, 57n., s8n.; on the office of executive director, 58n.; on research and statistics activities, 7on., 171L, 17m., I72n.; on the nature of SSB regional organization, 135, I35n.; on unity of command and single purpose and multi-purpose agencies, 142!, I43n., 294, 2£*n.; on de-functionalization, 171, 17m., 173, i73n.; on the constructive accountants, 173, I73n.; on regional clearance, i8if., on field units of bureau of U. C., 201-03, 202n.; on the regional director, 262, 262n., 265 Technical, defined, 139 Tennessee Valley Authority, 22-25. See also regional development authorities. Training. See communication. Treasury, Secretary of, 52 Truman, David B., 110, lion.; on rotation of personnel, 22411., 235, 235n.; on the regional director, 252, 252n. Unemployment compensation, 305n. See bureau of employment security. Unemployment compensation, bureau of. See bureau of employment security. United Medical Administration, 305n. United Service Organizations, 276

INDEX United States Employment Service, 30Sn. See bureau of employment security. Urwick, Lyndall, I2n., 16, 4111., 42n., 4Ôn. ; on staff and functional units, 133-36, 133a. ; on the nature of line, 140, I40n., 293, 293n. ; on line and function, l66n. ; on training, 235t., 235n., 23Ôn. Veterans Administration, I3n., 26n., 82, 118, 142, 2S7f. Vocational Rehabilitation, Office of, 72, 78!, 109; regional representative of, 73, 84n., 90f.

315

Wandell, W. H„ n6n. War Manpower Commission, 68, 73, 75, 91, 100, s6gn., 271, 2&)f. War Production Board, 142 Welfare, proposed department of, 30Sn. White, Leonard D , on staff, 132, I32nWhitehead, T. H., 23on. Willoughby, W. F., 3m., I33n. ; on unitary and multiple lines of field supervision, 137,137n., 293, 293:1. Wolcott, Leon D., 18911. Woolpert, E , 2Sn., 124 Works Progress Administration, 3if., 45. " 4 . I42f-, 258, 273 Wyatt, B. E., n6n.