branch by the Congress under section 5(b) is a power in addition to any "inherent" or "implied" power which may reside in the President to act in emergency situation. Thus, a complete repeal of section 5(b) would remove from the President that quantum of power which is conferred by the Congress, leaving him only with whatever "inherent" powers he may have by virtue of his office.

Given this context, I would suggest that any consideration of repeal or revision of section 5(b) needs to take into consideration two important general policy issues. One of these is the extent to which Congressional nonemergency authorization of the exercise of the powers currently available to the executive is desirable to maintain an efficient and executive governmental operation in the fields covered by this statute. The second equally important question is, would abdication by the Congress from the field entirely by outright repeal of section 5(b) without substitute legislation leave a constitutional power vacuum which would be filled by the executive branch acting without authorization in situations where some action might be clearly required by international or domestic circumstances, thus further affecting the constitutional balance.

There is no precise constitutional definition of the extent of executive power to act in emergency situations absent congressional authorization. Because the constitutional validity of any executive emergency action is so closely tied to the nature of the emergency and the circumstances surrounding it, it is virtually impossible to articulate a general constitutional test which would serve as specific guidance for or have binding effect upon a President who identifies the need to take action when an emergency faces the country. Neither of the two most important Supreme Court cases dealing with "inherent" or "implied" powers in the foreign affairs field have attempted to articulate a precise standard. Both emphasized the functional nature of the division of power between the executive and the legislative branches. In United States v. Curtiss Wright Export Corp.,1 a case dealing with a presidential proclamation prohibiting export of arms to certain Latin American countries, Justice Sutherland wrote: (W)e are here dealing not alone with an authority vested in the President by an exertion of legislative power, but with such an authority plus the very delicate, plenary and exclusive power of the President as the sole organ of the Federal Government in the field of international relations. ***”

The Court never attempted the impossible task of identifying the quantum of power exercised by each branch and, since Congress had made a clear delegation by a joint resolution, such a definition was unnecessary to the outcome of the case.

When President Truman seized upon Justice Sutherland's reference to "inherent" power to justify his seizure of the steel mills during the Korean War, the Supreme Court struck down the seizure in Youngstown Sheet and Tube Co. v. Sawyer, often referred to as the Steel Seizure Case. The justices wrote seven separate opinions in that case and none of them successfully defined the relative scope of executive and congressional power to deal with emergency situations. Only Justice Black took the absolutist position that there were no "inherent' or "implied" powers in the executive branch to deal with emergencies. Justice Jackson's famous concurring opinion has come to be recognized as expressing the true majority view in the case. He emphasized that the relative powers of Congress and the President were to be determined functionally and were not therefore subject to precise judicial definition. He wrote:

"(1) When the President acts pursuant to an express or implied authorization of Congress, his authority is at its maximum. ***

"(2) When the President acts in absence of either a congressional grant or denial of authority, he can only rely upon his own independent powers. * * * In this area, any actual test of authority is likely to depend on the imperatives of events and contemporary imponderables rather than on abstract theories of law.

"(3) When the President takes measures incompatible with the express or implied will of Congress, his power is at its lowest ebb." "

Jackson went on to find that, since Congress had expressly refused to grant to the President seizure authority when it was considering various labor statutes this seizure fill into the third category and was therefore unconstitutional.

1 299 U.S. 304 (1936). 2343 U.S. 579 (1952). 343 U.S. at 635-36.

It is clear that Jackson's three categories describe a process of constitutional law creation, not verbalized constitutional authorizations or prohibitions. That this should be so is particularly appropriate when one is dealing with the constitutional doctrine of separation of legislative and executive power. Seldom do these questions come before the courts and even more seldom, when they do come, are they accepted for adjudication. Thus, it is the political branches themselves who are at once advocates of constitutional legal positions and judges of the propriety of claimed constitutional authorization. It is by this continued process of demand and response that these constitutional legal norms are developed and given content and by the wisdom of their decisions that appropriate coordination as well as separation of constitutional powers is to be achieved. Thus, in a very real sense, the Congress has been, and this subcommittee currently is engaged in a law-making process which has not only statutory but constitutional legal implications. Therefore, one of the principal issues before this committee is raised by the constitutioanl implications of the history of executive-legislative interaction under Sec. 5(b) of the TWEA over the last 40 years.

This history of executive-congressional interaction has resulted in a general delegation of legislative power to the executive branch not only in those areas specifically mentioned in the TWEA but in any other areas that can conceivably be brought within its terms. This result has been brought about by the joint activity of Congress and the executive-the interaction of consistently broad executive interpretations of the power delegated followed by express congressional acquiescence in those interpretations.

Sec. 5(b) as originally passed in 1917 contained no provisions concerning special executive powers for “national emergencies." It was specially designed as war-time legislation for World War I, although it was envisioned, at least by some of its supporters, as providing stand-by authority for use in future wars. Although most other war powers were terminated by legislative act in 1921, the entire Trading With the Enemy Act, including Sec. 5(b) wa retained in force to permit continuing operation of the office of the Alien Property Custodian who still held a large amount of property. In 1933, President Roosevelt invoked the authority of Sec. 5(b) to permit the declaration of a bank holiday to prevent a bank panic and control the export of gold. He did this although Sec. 5(b) specifically exempted "transactions to be executed wholly within the United States" from the scope of the special powers which it conferred. Despite the fact that the authority provided to the President by this legislation was so weak as to be almost non-existent, Congress, when it was called into session, approved the President's action and his "interpretation" of Sec. 5(b) retroactively when it passed the Emergency Banking Act or the Bank Conservation Act. In that same act Congress amended Sec. 5(b) to delete the exclusion of domestic transactions from the grant of authority and to insert the provision permitting the exercise of special powers during declared national emergencies which remains in the current statute. President Roosevelt used this authority during the following year to issue a series of executive orders concerning the hoarding of gold and regulating its export. Each of these orders except the first specifically referred to the existence of a state of national emergency. All of these orders were ratified by Congress in the Emergency Banking Act of 1934 which incorporated Sec. 5(b) TWEA in toto. The Court of Customs and Patent Appeals in an opinion rendered in 1975 wrote that these activities in the early days of the Roosevelt administration clearly expanded the purview of the TWEA from that which encompassed only trading with an enemy in time of war to that which also encompassed dealing with "any" national emergency, including those involving no enemy and no war-related trading."

8

In September 1939, the President issued another proclamation of national emergency, this time in connection with the beginning of World War II in Europe and United States neutrality. In April, 1940, the President ordered the freezing of all assets in the United States belonging to residents of Denmark and Norway which countries had been invaded by the Germans and on May 7, 1940, Congress, 455 Cong. Rec. 4907-08, July 10, 1917.

See Ellingwood, The Legality of the National Bank Moratorium, 27 NW L. Rev. 923, 925-26 (1933).

48 Stat. 1.

7 Exec. Orders 6073, March 10, 1933; 6102, April 5, 1933; 6111, April 20, 1933; 6260, August 28, 1933; 6560, January 4, 1934.

8 48 Stat. 343 (1934, 12 U.S.C. 213 (1970).

United States v. Yoshida International Corp., 526 F. 2d 560, 575 (1975).

89-711-77-3

by joint resolution, approved the President's actions retroactively to remove any doubt of their validity. World War II went on, The President issued additional freeze orders concerning property of residents of other countries. In 1942 he delegated to the Secretary of the Treasury the authority to issue regulations concerning frozen assets. This authority is today the basis for blocking trade and financial transactions with North Korea, Cuba and North Vietnam. On May 27, 1941, President Roosevelt issued another declaration of national emergency and, based on this declaration, he ordered the Federal Reserve Board to impose consumer installment credit controls.10 In doing so, the President broadened substantially the definition of "banking institutions" in Sec. 5(b) to include any person who extended credit. In December, 1941, Congress in the First War Powers Act" approved all prior actions taken under Sec. 5(b), thus approving the President's new definition of "banking institutions". In 1947 the Congress, by joint resolution, removed the Federal Reserve Board's consumer credit power, in 1948 it restored it, in 1950, after that renewal had expired, it restored the authority again under the Defense Production Ace" and then, by repealing that section in 1952, appeared to remove the FRB's authority over consumer credit once more. In each instance, the Congress continued, however, the authority of the Federal Reserve Board to regulate consumer credit in time of national emergency or war. The National Emergencies Act of 1976 finally formally repealed the 1947 joint resolution.13

In 1950, President Truman declared yet another national emergency based on Sec. 5(b), this time in connection with the Korean War. In 1968, President Johnson invoked President Truman's 1950 declaration as the basis for instituting the Foreign Direct Investment Program. Then Attorney General Ramsey Clark in an opinion supporting the President's program cited historic precedent under Sec. 5(b) for thirty-five years and acts of Congress and judicial decisions sustaining the President's authority to use the act in this manner. In doing so he drew an analogy between Roosevelt's actions to control the outflow of gold and President Johnson's attempts to restrict the foreign holdings of dollars." In 1971 President Nixon declared a national emergency and citing "the Tariff Act, the TEA (Trade Expansion Act) and other provisions of law * * *" imposed additional duties on imports to protect the United States balance of payments position. When a suit challenging this authority was brought, the President argued that "other provisions of law" included Sec. 5(b) of the TWEA and it was on this provision that the court relied in upholding the validity of the import surcharge.15 in 1972 10 and again in 1974" President Nixon used Sec. 5(b) to continue the operation of the Export Administration Act of 1969 after that statutory authority had expired upon a date fixed by the Congress.

16

This brief history of Sec. 5(b) demonstrates that, regardless of the original intention with which the TWEA was passed, Sec. 5(b)'s effect is no longer confided to "emergency situations" in the sense of existing imminent danger. The continuing retroactive approval, either explicit or implicit, by Congress of broad executive interpretations of the scope of powers which it confers has converted the section into a general grant of legislative authority to the President permitting the executive branch by order, rule and regulation to make law concerning almost any subject matter which can conceivably be brought within the terms of Sec. 5(b). Sec. 5(b) permits the President to define any of the terms of the section. Only an outstanding declaration of the existence of a "national emergency" as defined by the President to bring those powers into being.

The most recent invocation of Sec. 5(b) by President Ford illustrates the legislative nature of the power conferred. The Export Administration Act expired once again on September 30, 1976. On October 1, President Ford continued that authority under Sec. 5(b). Despite some rather general dicta in the Yoshida 18 case indicating that there may be certain broad limits on the President's 5(b) powers, I believe that the current state of the law was accurately stated by Mr. Antonin Scalia, Assistant Attorney General in his letter to the Department

10 Exec. Order 8843.

11 55 Stat. 839.

12 64 Stat. 812.

13 Sec. 501 (c).

14 42 Opinions of Atty. Gen. No. 35.

15 Supra note (9).

16 Exec. Order 11677.

17 Exec. Order 11796.

18 Supra note 9.

of Commerce commenting upon the validity of President Ford's action. Mr. Scalia wrote:

"As a result of continuing interplay between the Executive and the Congress, Section 5(b) has been the statutory foundation for control of domestic as well as international financial transactions and is not restricted to 'trading with the enemy.' **We know of no indication of Congressional disagreement with the legality of this practice or criticism of it.'

19

Thus today, Sec. 5(b) and executive activities under it fall squarely within Justice Jackson's first category-the President's constitutional authority is at its maximum "pursuant to an express or implied authorization of Congress." In other words, the combination of legislative permissiveness and executive assertiveness over the past forty years has created a significant shift in the functional constitutional allocations of power to regulate foreign commerce from the legislative to the executive branches. Except in the case of a most serious abuse of this "emergency" power by the executive branch, this shift in authority will be upheld by the courts.20

Congress now is setting out to consider whether this constitutional shift is one which should be left in place or whether the legislative branch should reassert itself in this legislative process. Often questions of this kind are stated in terms of reclamation of lost power or of returning to the original intent of the framers or even, sometimes, in language which seems to indicate a desire to "punish" the executive branch for the results of a development in which both the legislature and the executive have participated. Rather, I would suggest. a slightly different characterization of the issue. The issue is how can the two political branches constitutionally coordinate their governmental powers so that each bears not only a share of the decision-making power but a share of the responsibility and accountability as well for the decisions which are made. The answer is not, I think, to continue the present system under Sec. 5(b). That would result only in a further diminution of the role of Congress in important policy decisions in which it should serve as one conduit for the people's voice. On the other hand, a total repeal of Sec. 5(b) and a reclamation of all power by the legislative branch, except the purely administrative power, would also not accord with the constitutional scheme. Rather, the search is for workable governance by the combined efforts of the two branches and a continuous involvement by both in the basic policy decisions which energize the law-making process.

In amending or supplementing Sec. 5(b) there are two separate but equally important issues. One involves the extent to which the Congress wishes to participate in the continued creation of powers in the executive branch to deal with true emergency situations. Even though some "inherent power" exists in the President to respond to emergency situations, it is clearly better statutory and constitutional policy for the Congress to set forth in advance those general policies which should control executive activity in emergency situations, especially in time of military hostilities. A well thought out congressional policy including reporting requirements and effective limits not only preserves congressional oversight but combines the sanction of both political branches to strengthen the government's hand in dealing with emergency situations. In addition, a preordained policy would go far toward preventing the kind of piece-meal expansion of "emergency" power which we have witnessed brought on by necessarily hasty action in response to difficult current circumstances. The National Emergencies Act clearly applies to emergency situations. The powers currently conferred by Sec. 5(b) seem to be appropriate ones when true emergencies exist. Therefore, to the extent that Sec. 5(b) powers are not conferred for general use, they should be continued as residual powers which can be called into operation when the need arises.

It may, however, be wise to authorize the executive branch to continue to exercise certain of these powers without regard to emergency situations. To the extent that this is done, I think new legislation should emphasize the coordinated nature of the constitutional powers, rather than their separation In this connection, I conclude with some observations concerning H.R. 2382. If

19 Letter from Antonin Scalia, Asst. Atty. Gen., Office of Legal Counsel, to J. T. Smith, General Counsel, Dept. of Commerce, Sept. 29, 1976, in BNA, International Trade Rep., U.S. Export Weekly No. 128, Oct. 19, 1976.

20 See e.g. United States v. Yoshida International Corp., supra note 9: Teague v. Regional Commissioner of Customs, 404 F. 2d 441 (2d Cir. 1968), cert. denied, 394 U.S. 977 ( ): Sardino v. Federal Reserve Bank, 361 F. 2d 106 (2d Cir. 1966), cert. denied, 385 U.S. 898 (1966).

Sec. 5(b) is either repealed or limited to "true" emergency situations, legislation such as H.R. 2382 is not only appropriate but necessary to continue effective powers of government in this field. I would suggest, however, that substantial doubts correctly exist concerning the constitutional validity of one of the mechanisms of this proposal-the proposed use of the concurrent resolution as a law-making device to bind the executive branch once the general trade embargo power is conferred. Several constitutional legal scholars have suggested various reasons why the use of the concurrent resolution technique as a form of legislative veto over executive action may be unconstitutional." The principal constitutional problem with the device, to my mind however, is that it denies that coordination of governmental powers which the constitution clearly envisions.

Under the plain language of the constitutional text, set forth in Article I, there are only two procedures by which legislation becomes law. The first is by vote of a majority of both Houses of Congress plus the consent, tacit or express, of the President; the second is by two-thirds vote of both Houses of Congress without Presidential consent. The wisdom of this constitutional procedure is that it coordinates political activity by requiring the consent of both of those branches elected by the people to create law, or the overwhelming consent of the legislative branch if it acts alone. That the combined activity of both branches is the desired form is made clear by the constitution's requirement that a joint approval be sought first before a special legislative majority may enact law on its own. Of course, constitutional change can take place by customary development, accepted by both branches as an integral part of the governmental system. The relatively recent rise of the concurrent resolution technique and the series of legislative-executive disputes over its constitutional validity demonstrate, I believe, that as a customary legal device it has not yet supplanted the clear textual requirement of coordination in law-making activity. Especially in the field of foreign affairs in which the executive branch has both a functional and historic primacy, I think it would be unwise to adopt a constitutionally questionable procedure when a much simpler and less controversial approach can accomplish the needed purpose.

The principal problem with trade embargoes is not that the executive imposes them arbitrarily or unnecessarily, but that they tend to be carried on by the inertia of government without periodic review and continued rejustification. I would suggest that an effective substitute for the attempt to bind the executive branch by concurrent resolution, would be a requirement that trade embargoes could be imposed by the executive branch under stipulated conditions for no more than six months or perhaps one year at a time without a reexamination and rejustification of the need to continue each embargo. By forcing the executive to take the administrative step of reexamining the existing embargoes and the political step of stating why they should be continued, the Congress would succeed in keeping the existence of the embargoes before the public eye and before its own eyes, for that matter. To adopt a device such as the concurrent resolution technique which the executive has strong constitutional grounds for ignoring could only lead to a further diminution of the influence of Congress in the foreign policy field in the long run and is especially dangerous in a situation in which à popular chief executive could combine his personal political strength with a strong constitutional argument.

Mr. BINGHAM. Thank you very much for a most interesting state

ment.

Professor Metzger.

STATEMENT OF PROF. STANLEY D. METZGER, GEORGETOWN

UNIVERSITY LAW CENTER, WASHINGTON, D.C.

Stanley D. Metzger received his law degree from Cornell University. He was admitted to the New York Bar and served as an attorney for the New York State Labor Relations Board. He served as the assistant legal adviser for economic

21 See e.g. R. W. Ginnane, "The Control of Federal Administration by Congressional Resolutions and Committees." 66 Harv. L. Rev. 569 (1953); H. L. Watson, "Congress Steps Out A Look at Congressional Control of the Executive," 63 Cal. L. Rev. 983 (1975); J. Harris, "Congressional Control of Administration" (1964), at 204-48.