means of transport has altered greatly in the past 25 years. According to ton-mile figures released by the ICC, railroads, which as recently as the prosperous period of the late 1920's carried three-fourths of all traffic, now carry only about one-half of the total. Inland waterways and petroleum pipelines have shown substantial increases, but the most spectacular rise during the past 15 years has been in intercity motor-freight transportation, including regulated, exempt, and private carriage. Trucks which in 1940 accounted for 10 percent of the total ton-mile traffic have increased their share to about 20 percent today.

The growth in capacity of the various transport agencies as traced through the years measures in some degree their respective abilities to compete and hence also indicates further evidence of pervasive competition. For example, about 1.5 million miles of surfaced highway were constructed between 1923 and 1954, and the completion of the great new highway program now before the Congress will further augment the competitive ability of motor carriers. The number of registered trucks has increased by approximately 6 million from 1929 to 1954. The average carried weight of tractor-trailer combinations on main rural roads has increased from 6.9 tons to 10.9 tons between 1936 and 1954.

The Government has appropriated in excess of $2.2 billion for new work construction of rivers and harbors projects through fiscal year

1955.

Pipelines have been improved so that larger diameters with greatly increased capacities are now in operation. The total miles of crude petroleum lines having a diameter of 10 inches or more increased from 15,040 miles in 1926 to 32,280 in 1952, or more than 100 percent, and account for almost all of the increase in total mileage of crude petroleum pipelines. The growth in products pipelines during the past 20 years has reached the point where they have to a large degree supplanted railroads as carriers of refined petroleum products. The mileage of all refined products pipelines increased from 1,400 miles in 1931 to 27,155 miles in 1952.

The close relationship between the initial improvement of basic way facilities and the subsequent growth of competitive potential is aptly illustrated in the inland waterway transportation industry. At the turn of the century inland waterway transportation was plagued by obsolete facilities. River courses through sites undergoing great new industrial expansion in coal and steel were relatively unimproved. Existing carriers were relying on outmoded steam packet boats which could not provide a satisfactory service in competition with land carriage. The improvement to the Ohio River, begun in 1910 and completed during the 1920's, made possible the utilization of large integrated tows for the carriage of bulk commodities. These tows in turn were made possible by technological developments in steam and diesel towboats, including the Kort nozzle. River improvement continued throughout the 1930's and 1940's and extended modern barge transportation to the lower Missouri River, the upper Mississippi River, the Illinois Waterway, the Tennessee River, the Gulf Intracoastal Waterway, to name a few.

Today inland waterway commerce is a progressive and vigorous industry with a growing capacity in modern tugboats and barges. The competitive potential of the inland waterways industry is therefore a fairly recent event and one that depended on news service concepts, technological innovation and improvements, and extensive engineering works on our rivers and harbors. The lack of these inprovements was a major factor in the eclipse of river traffic during the late 19th and early 20th centuries.

The motor-trucking industry is a good example of a transport industry that has grown from infancy to relative maturity within our lifetime. Motor carriers now compete actively for almost all segments of traffic except heavy ores, the bulk of the coal movement, crude petroleum, and certain other mineral products. Department of Agriculture data show the phenomenal progress of motor carriers in the marketing of agricultural products and the great lengths of haul in specific commodity movements. The overwhelming proportion of all livestock reaches market by truck; fruits and vegetables are trucked hundreds of miles to the great city markets; dairy and poultry products which require refrigeration are trucked in great quantities from the Middle West to either coast; and trucks move substantial amounts of grain in some sections of the country.

The competition of motortrucks has extended actively into all branches of manufacturing industry. A recent series of cases decided by the ICC traced the postwar growth of motor freight in the heavy steel business, and indicates the heavy participation of trucks into what was once almost exclusively a rail province. Case after case involving individual rates before the ICC document the active competition for manufacturers traffic between trucks and rails.

The heavy participation of motor trucks in the traffic of agricultural commodities and manufactured articles has put them ahead of railroads as revenue producers. In 1955 the total freight-operating revenues of class I railroads was $8.5 billion, which is just below their peak year, 1953, when freight operating revenues total nearly $9 billion. We have estimated that total "revenues" (revenues of regulated common and contract carriers plus cost of unregulated carriers) from trucking intercity freight during 1955 were $13.5 billion which is over 60 percent of the combined rail and motor freight revenues. We have been able to trace the great growth in total trucking revenues since 1940, a year in which the trucks earned only onethird of the combined rail and truck revenues. The truck share dropped off drastically during the war but increased rapidly thereafter until 1950 when it equaled the rail-freight revenues and since then has forged ahead. A graph attached to my statement shows the dramatic extent to which trucking now has exceeded railroads in producing revenue. Our estimate of truck revenues includes all regulated, exempt, and private intercity carriers, and is based on an assessment of truck ton-miles as shown by the ICC with representative tonmile earnings data.

Mr. HARRIS. Without objection, the graph may be inserted in the record at this point.

(The graph is as follows:)

MOTOR TRUCK

Mr. ROTHSCHILD. The growth in regulated truck revenues to where they now approximate rail revenues from manufactured goods signifies further that the motortrucking industry has reached maturity. It is generally known that the regulated segment of the trucking industry obtains practically all of its revenues from the carriage of manufactured goods. In 1940 the total revenues of class I, II, and III motor carriers were $768 million compared to $1.7 billion in rail revenues for the carriage of manufactured goods in carloads, forwarder traffic, and less-carload freight. By way of contrast, in 1954, the 2 transport agencies obtained equal amounts of revenues from the carriage of manufactured goods; class I, II, and III motor carriers totaled $4.1 billion in gross revenues and class I railroads obtained $4.3 billion in revenues from the carriage of manufactured-goods traffic. These figures are not estimates but are obtained from reports of the carriers to the ICC.

Many basic economic factors will tend to favor motor-freight transportation in the years ahead. The dispersal of population and industrial development into suburban areas and small cities, the improved control of big business over inventories, and new assembly and production techniques in manufacturing have been among the recent developments which have increased the service advantages of motor freight. In recent years many plants have located on new highways and are relying primarily on motor-freight service. There is little doubt that this trend will be accelerated by the proposed modernization of the Interstate Highway System. At the same time, the increases in populaion forecast for the next decade, and a continuance of a high income level will result in increased demand for all transportation service, of which motor carriers should gain a substantial share. With all these developments tending to favor motor freight, it appears that the motor carrier is in no danger of destruction from competitive activities.

In short, the trucking industry as a whole now exceeds the railroads in the total expenditure for transportation service, even though in tonmiles rail service is still considerably ahead of intercity total truck service. Trucks are more than holding their own in the short hauls and in the high-valued agricultural and manufactured-goods traffic, and it is only the predominance of railroads in the low-valued products of mines that enables them to exceed motortruck tonnage. No fairminded person can seriously believe that the survival of an industry with such a formidable competitive record would be placed in doubt by being freed, along with other carriers, to compete without artificial restraint.

COMMON CARRIERS AND THE NATIONAL ECONOMY

It is not generally recognized that common carriers as a whole have not matched in growth the progress of the national economy. The contribution of transportation companies to the national income has declined steadily during the past three decades. In 1929, for example, 7.6 percent of the national income was derived from transportation companies, but that percentage has declined steadily until last year when it reached 4.8 percent.

Has this decline been due to a lessened need for transportation service?

Definitely not. A simple comparison of the rate of rise in real national income with the total intercity ton-miles of freight traffic clearly demonstrates that the need for transportation service has paralleled closely the growth of our economy. But in spite of a continuing and growing need for transportation service, the participation of common carriers in total transportation has declined.

This decline has shown a tendency to accelerate in recent years. The combined share of total traffic for rail and motor common carriers was 65 percent in the years just preceding World War II. During the war it increased to over 70 percent. Since then there has been

a rapid decline to 55 percent in 1954, the latest year for which data are available. In some years since 1950, both rail and motor common carriers have contributed to this proportionate decline in common carrier ton-miles.

The relative decline in rail ton-miles of total freight ton-miles is a familiar story. It is also generally known that the motor common carriers have made great absolute gains in the postwar period due to the great surge in demand for motor-carrier service. But since 1950, the proportion of regulated motor common carrier ton-miles to all intercity ton-miles has shown some tendency to drop off. This could well be explained by the fact that motor common carriers have not kept pace with the growth experienced in all motor freight transportation. During the war, common carriers by motor vehicle carried nearly one-half of the total intercity motor freight. Today they carry about 28 percent, which is about their prewar level. There is evidence that further declines may be in store due to the growth of unregulated motor carriage which is well ahead of its prewar share.

Water common carriers in the coastwise and intercoastal trades have experienced extreme difficulties in the postwar era. This story is documented in a recent study by the Maritime Administration entitled, "A Review of the Coastwise and Intercoastal Shipping Trades." I would like to offer this report for the record at this time. Mr. HARRIS. Very well, it will be received.

(The report is as follows:)