breaking up the trip-leasing system of operations will be to the advantage of the trucking industry or the shipping public and the general public at large.

The CHAIRMAN. Are there any questions, gentlemen?

Mr. HALE. Mr. Lane, let me get your idea of public policy. Suppose I am a farmer in Virginia and I own a truck and I have some perishable crops that I want to get into market. I send my hired man with the truck into the market with perishable crops here to Washington to sell them. Then, on the return trip he brings back fertilizer that I need for my farm. You do not quarrel in the least with that transaction; do you?

Mr. LANE. Absolutely not, sir.

Mr. HALE. All right. Now, instead of bringing back fertilizer, I make an arrangement for hire with my neighbor to bring back a load of furniture which he is going to use in his own home. Is that objectionable in your mind?

Mr. LANE. I personally would not object to that; no, sir.

Mr. HALE. Then instead of doing that, he hires out for 29 days to some trucking company here in Washington, and runs all over the country, and that you do object to?

Mr. LANE. Well, no; I would not object to that, either, sir. What I would object to is in the instant case you describe, if that man came in from Virginia with a load of perishable farm commodities for distribution here in Washington, D. C., and then undertook to hire out to a noncarrier, a so-called common carrier with no equipment whatsoever, and run his equipment to carry commodities that are normally carried by a common carrier by motor vehicle, and run it down to Atlanta, Ga., or Wheeling, W. Va., or Chicago, Ill., without any semblance of regulation. That I must strenuously object to.

I believe in that sort of a situation he is really perverting the exemptions given to him as an agricultural carrier.

Mr. HALE. Why do you not say the same thing when he carries furniture back to his neighbor?

Mr. LANE. I qualified it for his neighbor; in that sort of thing it is a part of the American custom where, if you and I were neighbors down in Virginia, or wherever you happened to come from, sir, and I could be of service to you, I would be most happy to render that service.

If, on the other hand, I attempted to use my equipment and my vehicles to perform a service that normally and basically and historically is carried by a common carrier by either motor or rail, I most seriously would object to it.

Mr. HALE. Well, I can see plenty of ground for saying that the agricultural exemption should not be used for the carrying of entirely different commodities, but I cannot quite understand all of this emotional attitude about gypsy operators and so on.

Mr. LANE. Well, I am not, believe me, sir, attempting to be emotional. I have a vital interest in this industry that we are engaged in. We are at the present time attempting to protect it from encroachments from various other kinds of transportation which I think are eminently unfair; and we have been subjected to ton-mile taxes in various States in this country; and I was listening to some of the questions propounded here this morning and when the point was made about increased cost to the farmers I would like to submit likewise

that additional ton-mile tax on motor vehicles will result in increased costs to not only the farmer but the consumers of all products that are used in this great country of ours, because nothing that we use in our daily life at some time or other isn't hauled and utilized in truck transportation, and utilized in bringing it to or from the market. Certainly, with respect to the farmer that you are referring to, if he is engaged strictly in agricultural work with that truck, I personally have no quarrel with that, sir. But I think you will agree with me if that tractor that is used ostensibly to haul farm products to and from market instead of hauling products back to the farm, it is used in transporting freight on the rights of a common carrier by motor for a division of revenues. I think you will agree with me that that is hardly an equitable procedure under our system of regulation today.

Mr. HALE. Well, I still have difficulty in seeing just exactly where you draw the line. Suppose instead of carrying a load of furniture back to his neighbor, he carries a load of furniture from Washington to New York and then brings back some other commodities from New York to Washington, and then comes back to the farm. Do you have objection to that?

Mr. LANE. Yes, sir. I think the movement from Washington to New York in the instant case that you described, should commonly be performed by a common carrier by motor, or who is duly certificated by the ICC to perform that service, by his own people, with his own equipment, or at least if he is going to employ this man to have him on his payroll for a period of 30 days or more where he can regulate the hours that the man works and oversee the safety requirements of his equipment and other factors that might tend to bring this industry to its rightful position in the scheme of things.

Mr. HALE. I think that that is all.

Mr. BENNETT. If the certificated carrier enters into an agreement with the gypsy operator, isn't the operator responsible under his franchise for the kind of a job that the gypsy does, or the kind of equipment he uses, and for the general operation? Is he not responsible to see that he, the gypsy, performs his contract in the same manner as the carrier himself would perform it if he were using one of his own trucks?

Mr. LANE. I would rather answer-I think the question could be rather answered this way, sir: That the man that hires the so-called gypsy is concerned only with the responsibility of delivering the commodity that he picks up and delivering it to its destination. Once he gets there he is free and clear.

If, on the other hand, there was some accident on the highway or injuries, I would be inclined to agree with you that ultimately the certificated carrier might have well been held civilly responsible for any damages that occurred.

Mr. BENNETT. Could not he also be held responsible by the Commission? In other words, if a certificated carrier, by the use of a gypsy operator, violates the rules and regulations of the ICC or the law itself, is not that grounds for a proceeding against him by the ICC to revoke his certificate?

Mr. LANE. I think it would be grounds for the Interstate Commerce Commission to proceed against the operator, the so-called gypsy operator, but bear this in mind, sir.

Mr. BENNETT. I am not talking about the gypsy operator. I am talking about the operator whose franchise the gypsy is working under. Mr. LANE. Well, there is a question in my mind whether the operator could be subject to any penalties by the Interstate Commerce Commission.

Mr. BENNETT. A certificated carrier is supposed to, as I understand it, operate in the public interest.

Mr. LANE. That is correct.

Mr. BENNETT. And to operate in accordance with the rules of the ICC.

Mr. LANE. That is right.

Mr. BENNETT. Now, if he designates someone else or permits some other carrier to operate under his franchise, does not he have the same obligation under the law and the regulations to see that that man operates the same as he himself would operate?

Mr. LANE. Yes, sir, he probably would have the same obligations, but the enforcement of it would be ineffective. The enforcement might be ineffective for this reason, Mr. Congressman, that your ICC governs hours it serves and on-duty time and other factors that are conducive to safety on the highway. But you, being the common carrier, might employ me to carry a load of freight from New York City to Detroit, Mich., and as soon as I arrive in Detroit, Mich., my duties and obligations to you are over.

Then I go to work for some other company coming from Michigan back to Savannah, Ga., and so it would be almost a metaphysical impossibility for the Interstate Commerce Commission or any other regulatory body to proceed under existing conditions against the certificated carrier, in the instance that I just described.

Mr. BENNETT. They could proceed against you if you were the man that had employed him to go from New York to Detroit.

Mr. LANE. They could proceed against me for violating the hours of service and the on-duty time and not keeping logs in proper shape. Mr. BENNETT. The thing I am wondering about is that a lot has been said here about these gypsies being unregulated and not subject to safety rules and not subject to various rules and regulations of the Commission. Maybe I misunderstand this situation, but I have gathered the impression that a gypsy operator cannot function unless he does so under the certificate of a carrier who has a franchise from the ICC.

Mr. LANE. There is only one variance to that, if he carries for a manufacturer or some other industry. For instance, he might carry a load of freight for a manufacturer from point A to point B.

Mr. BENNETT. Well, does this have anything to do with that? This present bill, does it have anything to do with that arrangement? Mr. LANE. I think that it might if it would compel whoever hires these people to put them on a 30-day basis.

Mr. BENNETT. The thing I am wondering about, and it has not been made clear to me, is that if the Commission has the authority to regulate a certificated carrier, and to cancel or revoke his certificate if he does not comply with the law, should not that give the Commission sufficient authority to police these so-called carriers that use gypsies?

Mr. LANE. I would think so, sir, and I think that the case that was just decided by the Supreme Court tended toward that end.

Mr. BENNETT. I mean without the regulation that they have put into effect.

Mr. LANE. I doubt it very much, sir. I doubt it very much. It would seem to me that the only way that they could really regulate these itinerant operators or truck people would be by having the control of the term of the lease and setting down the terms and conditions under which these leases could operate.

Mr. BENNETT. That is all I have.

Mr. HESELTON. Do you agree with Mr. Tobin's estimate that there is approximately 25 percent oversupply of trucks in the country today?

Mr. LANE. Twenty-five percent over, you say?

Mr. HESELTON. I think that that is the figure that he used.

Mr. LANE. Well, I would not want to say "Yes" or "No" to that. Our company just bought 500 brand new tractors and about 600 new trailers, and we certainly hope to run them over the highway. I suppose that if you counted the number of pieces of equipment on the highway that are not fit to run on the highway, that might be a menace, and if you eliminated those, I think we could continue to use 100 percent equipment of motor vehicles.

Mr. HESELTON. If you eliminate the unsafe trucks, you would be all right?

Mr. LANE. Just like the insecure automobiles.

Mr. HESELTON. I would like your comment on a couple of other points.

In the Supreme Court decision in this matter, Mr. Justice Black filed a dissenting opinion in which he said this:

The Commission's rules makes it impossible for these exempt carriers of agricultural products to get the advantage of a lease for a return haul. The result is destruction for a large part of their business.

Now, that is a rather positive statement. Do you feel that that is likely, that it will have the effect of destroying the people engaged in this exempt hauling?

Mr. LANE. I would hate to disagree with the learned Justice, but in this case I do, sir.

Mr. HESELTON. Now, to go to something that is not quite as strong as that, I notice one of the witnesses has filed a statement and refers to a letter of March 27 of this year from Commissioner Mahaffie, as Acting Chairman of the Commission's Committee on Legislation, addressed to the Honorable Charles W. Tobey, chairman of the Senate Committee on Interstate and Foreign Commerce.

He states that he referred to the facts before the Court, and one of the appeals from the ICC's decision gave particular consideration to the assertions of some of the parties, including the Secretary of Agriculture, that the rules jeopardized the national economy. He said, "Such practices might result in restricting the distribution of the products of agriculture, increasing the mileage operated without cargo." The Court said that this was an argument which must be addressed to the Congress. So, of course, in this particular instance, it is addressed to each of us.

Now, in your opinion, would it have the effect of restricting the distribution of products of agriculture?

Mr. LANE. I do not think so, sir. I think facts and circumstances over the past 25 years have certainly discarded that theory because if there is any single instrument that has been responsible for the development of, for instance, the industrial potential of the South, it has been the trucks.

Commodities are manufactured in the Carolinas, in Georgia, and Texas, and within 24 or 36 hours it is at the market in New York City, and if Chicago, they are in Chicago in 24 to 36 hours. I think that there has been no medium that has brought about a more stable economy than the trucking industry.

I can say this, though, addressing myself particularly to this question that you are raising, I suppose that if they took off all of the railroad trains running between two given points because there was not sufficient traffic to maintain a modest return on revenue, it might very well reflect increased costs. I think the same would apply here, but I do not think it would have much effect on the overall picture. I think the truckers in the past have, and will in the future, performed as good service for the farmers as they performed for industry at large.

Mr. HESELTON. Do you foresee any increase in the mileage being operated by both regulated carriers and these exempt carriers because of the 30-day provision?

Mr. LANE. May I have that question again, sir?

Mr. HESELTON. I read from this letter of Commissioner Mahaffie that it would have the effect of increasing the mileage operated without cargo by both regulated carriers and transporters of agricultural commodities. I think he means that if you have the 30-day provision there would be a large increase in one-way empty mileage.

Mr. LANE. I think that that is one phase, and it is equally true that it might tend to bring about a more efficient operation. It would seem to me that if they are going to market today, they will be pretty assured of a load of farm products coming back. In other words, what I am trying to say, sir, it might tend to bring about a more efficient operation of a truck between 2 or 3 given points.

Mr. HESELTON. As I have understood the testimony, there was pretty general agreement that it would be a very unusual transaction where a load taking exempt commodities to any part of the country and then the return trip where it would take as many as 30 days.

You have indicated the speed with which you were able to get the products from the South into New York and Chicago. Would not the 30-day provision have a tendency to decrease that type of haulage? Mr. LANE. Well, it might tend to decrease that type of haulage, but at the same time it would undoubtedly give more stable employment to a man that has invested money in this motor equipment, the so-called gypsy.

For instance, if this regulation provides, and as proposed here, if I lease a tractor from you, I have got to keep you on my employment for 30 days, and it is true as we are sitting in this room I am going to try to keep you busy for 30 days.

If, on the other hand, without any kind of restriction or any kind of regulation, I can hire you to carry one load of freight for me, and I am through with you, it seems to me that the stability of employ