Mr. ANDERSON. I handle all commodities today, and I would have to publish rates for all commodities.

Mr. HINSHAW. That is going to be as big as the tariff itself.

Mr. ANDERSON. It would be much bigger than a rail tariff. It is ridiculous. They are trying to regulate us the same as a railroad.

Mr. HINSHAW. If you were permitted to publish tariffs between your assembly and distribution centers and then act as the agent of either the shipper or the consignee, whichever controls the freight to destination, would that be a disservice to the shipper, or would it be a service to him, in your opinion?

Mr. ANDERSON. It would very definitely be a service to him. They like it. I have never had a shipper complain about my way of doing business; never. It gives them a chance to do anything they want to. They know what my rate is from my loading station to my distribution point. Then they can tell me how they want it moved from there. I have no part in it.

If I get a contract rate, I publish it and show him what rate I got. If he wants to use it he can. I believe that rate belongs to the shipper. Mr. HINSHAW. Is it possible that the consignee might want to pick the freight up at your distribution center?

Mr. ANDERSON. Yes, sir; many of them do it. Many of them do it. Mr. HINSHAW. And it would be an unprofitable thing to do if you would have to quote the rate to his door, I take it?

Mr. ANDERSON. That is right.

Mr. HINSHAW. And so consequently, to that extent if he were going to deliver some freight to you in his own truck, he could at the same time pick up inbound items?

Mr. ANDERSON. Many of them do that, surrounding Los Angeles particularly, and the bigger cities like San Francisco and Seattle.

Mr. HINSHAW. You point out on page 5 of your statement it is your opinion that there is much more unfair discrimination in rates today than there ever was before regulation, and you say:

I am at this moment maintaining a great many grossly excessive rates, which ironically I have been prevented by regulation from correcting.

Will you elaborate on that?

Mr. ANDERSON. In November of 1954 the railroads changed their ratemaking policies eastbound and westbound in the transcontinental territory. At that time this really started in August 1954-they changed the rules so you could put pitchforks and hay and glassware and machinery in the same car and pay the carload rate on each commodity.

That changed the entire picture for mixed carloads of freight. The organized forwarders took advantage of that change in rail rates at one time, November 10, 1954 by eliminating arbitraries to many cities in the West, cutting some of the rates, and cutting my rates out of Chicago. I mean the stuff I specialized in-it became necessary for me to change my whole setup and handle all commodities which are available to me in the areas where I have a loading station.

I was attacked. They asked the Commission to suspend those rates. Since then, I wrote certain Members of Congress in November of 1955-I have four pages here, closely typewritten pages-relating what has happened to me in 1 year.

Now it is worse. Now I haven't been able to do anything at all for almost 6 months, while some other cases are being heard and being reopened. In other words, I am not being permitted to serve the people I have served for over 25 years out of Ohio, Pennsylvania, and through that territory, and eastbound from California, because every rate I file is suspended and we have to have a hearing on it.

This thing has gone on and on. We have had class rates where I had to protect myself in the old days before this change in rail rates; I had to make high-class rates, because then you had to pay LCL on certain things you put in your car or else pay the highest rate on the highest rated commodity for the whole carload.

I tried three times to reduce those class rates. They are ridiculous. They are almost express rates today, and yet I have not been permitted to do it. Many an innocent customer of mine ships what you might call a contraband item that I don't have a commodity rate on, any tariff, and because I have not been able to publish it, I have to charge him this ridiculous rate, when I should charge him the same. overage that I charge on any commodity.

Mr. HINSHAW. To listen to this statement, it would almost seem to me up here that someone down at the Commission had been in collusion with the other forwarders in trying to put you out of business. Mr. ANDERSON. Mr. Hinshaw, it looks that way to me sometimes, but I think here is what they are trying to do. Actually and honestly I believe this. I believe there is a price-fixing arrangement going on in this country between the trucks and the forwarders, and I believe the Commission wants to see 1 giant bureau have 1 rate for everybody. It's like one big country, everybody pay the same rate regardless, from this town to that town. If that's the case, what is the use of having a forwarder, a carloader, if a man can't operate cheaper between New York and Chicago than he can from some little town, say, Syracuse, N. Y., and Pomona?

What is the sense of him being in business? It is a ridiculous thing. It is stopping trade. It stops industry from marketing its products. In a growing economy like we have in the United States, a man should be able to start a new service tomorrow if he wants to, from up in Maine down to southern California, or start it from northern California down into Florida, and if I can make a carload shipment from Los Angeles to Miami, I should be able to quote a carload rate plus down there, and I shouldn't have to quote the rate somebody else quotes or a truckline quotes.

It is a ridiculous thing in our country to have fixed rates. The carriers have their fixed rates and that should be enough, not for a middleman.

Mr. HINSHAW. Mr. Chairman, I think that it would be very well indeed for the subcommittee to inquire into the matter of docket I. and S. No. 6305 and ask its history, so that a little more elucidation might be had as to the processes of the Commission.

However, that, of course, we can take up in the full subcommittee when they are present.

I note on page of your testimony that you say in the paragraph in the middle of the page:

But there is considerably more to the story. In December of 1954 the organized forwarders filed some reduced rates from the Pittsburgh area, ostensibly to meet

some reductions which I had recently made. Actually, the rates were far below mine, and they were also, almost self-evidently, below cost.

Then you go on to describe what happened thereafter. That seems to me to warrant quite an investigation, Mr. Chairman, but the full subcommittee can decide that.

On the next page, in the middle of it, you were talking about a restraining order directing the Commission to reinstate a certain suspension, and then you said

The Commission was unable to be represented in court because of inadequate notice given by the organized forwarders.

I wish you would explain that a little bit.

Mr. ANDERSON. In one of my numerous cases that the Commission vacated eventually, vacated a suspension, the organized forwarders went into court at Wilmington, Del., and got an injunction against me and the Commission, which stopped this vacation, and the hearing was set, but when the Commission attorneys went down there about 10 days later for this hearing, the forwarders withdrew their complaint.

To me it has been almost a question of nothing but harassment. These two frivolous matters were brought before the Federal courts and for no reason whatever except for harassment, and the sad thing about regulation of middlemen like us is that the Commission can, if it so desires, keep you in hot water all the time.

You can't serve your public. You can't keep up with changing conditions. Personally, I believe that the forwarding business in this country has now developed into where it is a monopoly and it is one bureau that runs everything, and unless you agree with them you can't operate.

The day of independence is gone. The forwarding business can be a terrific business as a marketing arm for industry if left alone, and we don't need the fostering hand of regulation for us to do a good job for the American public.

Mr. HINSHAW. On page 10 of your statement, you have made quite an allegation in the following words (about a third of the way down).

One would think that when a forwarder filed a set of rates which he avowed and insisted were unlawful, the Commission would summarily direct that the rates be withdrawn and canceled. Instead, the Commission docketed the case and set it for hearing.

If that is true, then it would indicate quite clearly to me from here, in looking upon the situation, that there had been some collusion between the Commission and the forwarders.

Mr. ANDERSON. Mr. Hinshaw, I have talked to many transportation men recently who told me that these cases were absolutely a disgrace. There was a forwarder operating out of Chicago who published some of my contract rates, the same as I published, from Detroit, Toledo, and around there, and the organized forwarders, of which he is a member now, asked for suspension-this had nothing to do with Pittsburgh-and they were suspended and the party who filed the rates admitted that he didn't think they were lawful.

Yet the Commission permitted that hearing to go on. They held it out in Los Angeles, in my home town. They all moved out there. I wasn't a party to this thing. Then they had another one here in the East and all they talked about in those two cases was the way I did business.

To me, that is a travesty on justice. Why would a Commission permit something like that? When a man publishes rates he ought to go through with them.

Mr. HINSHAW. In other words, to rig a deal where you could be opposed without being represented?

Mr. ANDERSON. That is right, sir.

Mr. HINSHAW. That seems to me to be quite reprehensible, if you don't mind my saying it.

Mr. ANDERSON. That seems to be the opinion of many men.

Mr. ROGERS. Maybe you are the man, Mr. Dynamic Competition, everyone seems to be looking for.

Mr. ANDERSON. I don't know about that. They are gunning for me. I don't know why. Because I treat the public right, I guess. I make a lot of money. I paid more taxes than any of them per hundred pounds. I'll stand on that statement.

Mr. HINSHAW. To my friend Mr. Rogers, I was going to say, it is quite surprising that he would make that much money and still have his competitors charging higher rates. It must be that they are making an awful lot of money. I have wondered about that.

I would think that if there were competition, really competition, among the forwarders, it would be unnecessary to protect the shippers by having pool-car operators and cooperative shipping associations. Mr. ANDERSON. I certainly agree with you.

Mr. HINSHAW. Because I would think that if the forwarders under competitive rates, which they would have, if it were not illegal to make any kind of a rate within their capabilities would be of great benefit to the shipper, and at the same time that rate would not in any way hurt a carrier because they would be paying the published rates to the carrier.

Do you think by repealing part IV entirely that something akin to that situation would be brought about?

Mr. ANDERSON. I certainly do. Of course, I always thought that part IV was more or less a war act. After all, it was wartime action, 1942, and everybody seemed to think it was a good thing for the country then.

However, the thing to do in this country is to move commodities back and forth; keep it going; keep it active. And a good forwarder will help an industry to market its products. Many shipper associations today would go out of business-they would be glad to-if some good forwarder would take care of them and give them a reasonable

rate.

I think you will find in all their testimony that the thing they object to is paying phony rates. In other words, up until they removed these arbitraries in the West here in November of 1954, San Diego, for instance, always had straight cars from these other forwarders or stopover cars, but yet they charged an arbitrary to San Diego.

That was terrible. They shouldn't have paid an arbitrary. They are fixed rates. The thing that organized forwarders are worried about are the trucklines, so they make rates the same as the trucklines do.

Why should a forwarder have to worry about a truckline? A truckline should get business where it should get it, and a forwarder should get it where he should get it. If you can't use a pool car and save a

man money and do a good job for him, you should let the truckline handle it or the rail 1. c. 1.

This way you are getting more and more into a regimented setup here in this country where it is going to be bad for business. It is getting worse and worse. I am absolutely opposed to regulation of associations, even. Even though they are my competitors, I think it would be terrible to have the Commission pick on one, and another, and this one and say "You can't do this and you can't do that."

You would stop business in this country. You stop normal trade. It is a terrible situation to be getting into.

Mr. HINSHAW. You have to regulate the carriers and, of course, you pay the regulated carriers' rates so such rates can't be considered to be unfair.

Mr. ANDERSON. That is right.

Mr. HINSHAW. The rate that you charge the public is something less than the regulated carrier's 1. c. 1. rates, and something more than his carload rates. Therefore, you perform essentially the same function that the nonprofit shipping associations perform.

Mr. ANDERSON. Absolutely the same. There is no difference in our operation whatever, not a bit.

Mr. HINSHAW. And you make a profit, you say?

Mr. ANDERSON. You bet I do.

Mr. HINSHAW. You can even beat the nonprofit shippers, can you? Mr. ANDERSON. I can't beat them in price usually, but I can come pretty close, and a lot of them would rather deal with me than do all the work themselves. I notice some of the larger firms here today.

I will talk about the company of a man I just met back here, the biggest in the country, Sears. Years ago I used to have volume rates, before regulation. If a man gave me 6 or 7 million pounds a year, he got a certain rate. If he gave me 2 million pounds a year he got another rate.

Then it went down to the nifty-gifty. He got a high rate. There wasn't much difference between the little fellow and the big man, say, 50 or 60 cents a hundred, but the big man made it possible. He paid more money for service rather than make up his own cars.

He saw that I made a profit. Most of these firms are fair. They don't want you to work for nothing for them. They gave me a small profit and that permitted that little fellow to take advantage of that big tonnage, and it was a fine thing.

However, I had the Commission down my neck. They threatened to take me to court. They were going to fine me for all kinds of things. I don't know how many acts they pulled on me. I was going to take it to the Supreme Court, but I lost out.

They told me I was discriminating, so I had to stop that. I am sorry now I did. I should have taken it to the Supreme Court. We wouldn't have had so many associations if I had won.

I think regulating carriers is enough. Why regulate a middleman? Let people operate. That's what makes the country great. Let them ship wherever they want to; competition. That's what makes life.

Mr. HINSHAW. Thank you. No further questions, Mr. Chairman. Mr. ROGERS. Thank you. Mr. Hinshaw, and thank you, Mr. Anderson, for a very interesting statement.

Although there is an issue here as to what should and should not be done with the middleman, I think I can assure you that if there is skul