The Texas Legislature's Joint Anti-Nepotism Committee was created by House Concurrent Resolution (HCR) 7 during the First Called Session of the 43rd Legislature in 1933. Representative Cathey introduced HCR 7 on September 22 for the purpose of clarifying a provision of the appropriations bill (known as the Anti-Nepotism Law), passed during the Regular Session of the 43rd Legislature, that stated that no more than one person in any family could be on the payroll and draw a salary from the state. Apparently the committee conference sessions on the appropriations bill had altered and revised the provision in such a way as to make it difficult for some heads of state departments to understand. Cathey clarified the provision, noted that numerous heads of state departments were wholly disregarding and blatantly violating both the spirit and letter of the Anti-Nepotism Law, and proposed a committee of three Representatives and two Senators to investigate cases of nepotism and job swapping. The Resolution was referred to the House Appropriations Committee, passed in the House on October 6, passed in the Senate on October 12, and assigned Representatives Cathey, James, and Griffith (replaced by Holloway in March of 1934) and Senators Murphy and Hornsby on October 13, 1933, the last day of the First Called Session.

The committee conducted the majority of its investigation during the interim between the First and Second Called Sessions of the 43rd Legislature; its first meeting was on November 8, 1933, at which time members chose Cathey to be Chair. The committee met throughout November and December of 1933 and then again in March of 1934. During the interim period the committee gathered information by sending questionnaires to all state employees, asking them to swear to the number of their relatives who worked for the state, heard testimony, and gathered shipping evidence regarding stolen Texas State oil (an outgrowth of the nepotism concern).

By the end of February 1934, near the end of the Second Called Session, the committee had yet to submit the report expected by the House. The House, therefore, passed House Concurrent Resolution 29 requesting the committee to submit a partial report by February 27 and then disband. The Senate concurred but amended the resolution to request the committee to submit its report within 45 days. The report was finally submitted on April 13, 1934 and, in it, the committee concluded that the anti-nepotism laws had been repeatedly violated. At worst, over 60% of some state agencies were staffed by relatives of other state employees. A few state agencies employed no relatives of other state employees. In the Legislature, over 45% of the House members and 84% of the Senate members had relatives on the state payroll. The committee remarked upon the likelihood that job swapping [i.e. you hire my son if I hire yours] was practiced. The committee decried the actions of all those engaged in the practice of nepotism but chose not to make specific recommendations for resolving the problems. Instead, it hoped that a member of the Legislature or a citizen of the state would make suggestions and develop legislation to forever put an end to these damnable unscrupulous violations of the Nepotism Law, both in letter and spirit.