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It is apparent to us that any change in the national transportation policy or the various other statutes giving the Commission authority to establish minimum and maximum rates can only result in a chaotic condition in our national transportation and inefficient and inadequate transportation. The various carriers are accustomed to regulation by the Commission and it is quite apparent that such regulation has in no way been harmful to the carriers. On the other hand, present regulation has and will permit each mode of transportation and the public to enjoy the carriers' inherent advantages. There is a place in our national transportation picture for all modes of transportation, but without the present regulation of the carriers, it is doubtful whether the barge lines, at least in the Pacific Northwest, can survive the continuous attack by the rail carriers whereby they reduce their rates to divert traffic.
It is respectfully requested that H. R. 6141 and H. R. 6142 be disapproved and that no changes be made in the present transportation act. Dated at Portland, Oreg., this 7th day of June 1956.
UPPER MISSISSIPPI WATERWAY ASSOCIATION, INC.,
Minneapolis, Minn., June 7, 1956. Re In opposition to H. R. 6141 and H. R. 6142 Transportation Amendments Act
of 1955. Hon. OREN HARRIS, Chairman, Transportation and Communications Subcommittee, Committee on
Interstate and Foreign Commerce, House Office Building, Washington, D. C. DEAR MR. HARRIS: My name is Aubrey C. Mills. I make this statement in the capacity of secretary of the Upper Mississippi Waterway Association. As I am unable to make a personal appearance before your committee, I respectfully request that this statement be included in the testimony in overall opposition to H. R. 6141 and H, R. 6142.
The association which I represent was chartered in 1932 "for the advancement of the commercial, agricultural, mercantile, and manufacturing interests of the upper Mississippi Valley through the deevlopment of an al-water transportation route via the Mississippi River to domestic and foreign markets.” Through the years it has effectively worked, in the beginning, for the establishment of the 9-foot channel from St. Louis, Mo., to the Twin Cities of St. Paul and Minneapolis, Minn. Since the completion of that channel in 1935, which made navigation possible, it has supported every issue and program which would increase the volume and extend the benefits of low-cost water transportation to the advantage of literally millions of inhabitants of the area served in the 662 miles of the upper Mississippi River between St. Louis and Minneapolis.
The membership of the Upper Mississippi Waterway Association consisting of approximately 115 large and small industries (users of river transportation); targe-transportation companies (both common and contract, regulated and unregulated carriers) ; chambers of commerce, and other civic and municipal bodies, is unanimously opposed to some or all of the provisions of the instant bills. We urge your committee to consider that:
1. No segment of the transportation industry will benefit by the enactment of this proposed legislation except the railroads. On the contrary, other segments of the industry will be hurt. It is evident from the bill as a whole that its purpose is to restore to the railroads the monopoly which they enjoyed prior to the passage of the Interstate Commerce Act 69 years ago.
2. "Dynamite competition," mentioned in the new proposed national transportation policy, when viewed realistically and in the context of the remainder of the bill means-no competition. With the destruction of forms of transportation competing with the railroads, including barge lines and trucks, who will ultimately be really hurt? . And the answer, of course, is the general public. Specifically, this association is opposed to:
1. First and foremost, section 2 of H. R. 6141, to provide a new national transportation policy.
2. The limiting of authority of the Interstate Commerce Commission to the Istablishment of only minimum and maximum freight rates. 3. The proposed amendments to section 4 of the Interstate Commerce Act. 4. The limiting of the rate suspension powers of the Interstate Commerce Commission,
5. The granting of authority to rail carriers to publish and charge volume freight rates.
6. The proposed redefinition of contract water carriers.
7. Section 14 of H. R. 6141 providing for repeal of section 303 (b) of the Interstate Commerce Act.
I hereby certify that the following resolution was unanimously adopted by members of the Upper Mississippi Waterway Association assembled in annual meeting in Minneapolis on October 5, 1955:
"In April 1955 the “report and recommendations of the Cabinet Committee on Transport Policy and Organization' was issued. Legislation to implement the recommendations was introduced in May 1955.
"This legislation, if enacted, would appear to substitute a policy on the part of the Government to encourage and promote full competition between modes of transportation,' in place of the traditional Government policy to 'encourage and preserve the inherent advantages of each type of transportation. The authority of the Interstate Commerce Commission to prevent ruinous rate wars between the several types of transportation would be greatly curtailed, to the very great disadvantage of all segments of water transportation. This association is strongly opposed to the enactment of any such legislation.” Respectfully submitted.
UPPER MISSISSIPPI WATERWAY ASSOCIATION,
WATERWAYS COUNCIL OPPOSED TO REGULATION EXTENSION,
New York, N. Y., February 2, 1956. Hon. OREN HARRIS, Chairman, Subcommittee on Transportation and Communications,
Interstate and Foreign Commerce Committee, Washington, D. C. DEAR CHAIRMAN HARRIS: This letter concerns any prospective hearings on legislation designed to implement the report to the President of the Presidential Advisory Committee on Transport Policy and Organization and, in particular, provisions designed to carry ont recommendations B and C of the section entitled “A Modernized and Financially Strong System of Common Carrier Transportation Must be Maintained." These recommendations call for the extension of full-scale public utility regulation by the Interstate Commerce Commission to the carriage of dry-bulk commodities in water transportation. Presumably implementing legislation would be similar to sections 13, 14, and 18 of S. 1920 introduced on the Senate side in the first session of this Congress.
The Waterways Council Opposed to Regulation Extension is a temporary group formed on March 17, 1954, for the sole purpose of opposing legislation designed to eliminate the bulk commodity exemption in section 303 (b) of the Interstate Commerce Act which would be the effect of the recommendations referred to above. The membership of the Waterways Council consists of a large number of shippers, terminal operators, and water carriers.
Intermittently over the last 21 months this organization has been preparing to oppose this type of legislation which first emerged in S. 3111, a bill introduced in March 1954 and reintroduced as S. 951 in the 84th Congress on February 4. 1955. The Council has developed many allies among trade associations, cham bers of commerce, national organizations, and shipper groups who wish to join in opposition.
Because no public hearings have ever been called on S. 3111 in the 83d Congress and S. 951 or S. 1920 in the 84th Congress the opposition to this proposal to remove the bulk commodity exemption for water transportation has never had an opportunity to present its case on the Senate side. Nor was any opportunity given for this group and its allies to present the case against the elimination of the exemption to the staff or members of the Presidential Advisory Committee prior to the submission of the Report on Transport Policy and Organization. Likewise, you will recall that last fall when brief hearings were held by your committee for the purpose of hearing a limited commentary on the report by one representative of each of the major segments of the transportation industry, it was unfeasible to present the fully developed case in opposition to this feature of the report.
Naturally it is our hope that the strong and unfavorable reaction from many segments of the economy affected by the proposed recommendations in the Re port of the Presidential Advisory Committee will lead your committee to defer
indefinitely any action in the nature of hearings or other legislative proceedings designed to implement this report. We would hope that this decision to table indefinitely the recommendations on the elimination of the bulk commodity exemption on inland waterways would be taken and announced by your committee at the first opportunity because of the reasons disclosed in the hearing and summarized in my letter to you of September 15, 1955.
Should there be a contrary decision to hold hearings and press forward with legislation designed to carry out this report and, in particular, the recommendations referred to concerning water transportation, then the waterways council and the shippers, water carriers, and terminal operators and allied trade groups will want to have a full opportunity for a complete hearing. In the view of those of us in the water-carrier industry who have studied this problem closely over the past 2 years, this is a matter of life and death for hundreds of the smaller operators who are engaged primarily in the hauling of bulk commodities on the inland waterways free from any public-utility regulation. Furthermore, the change of the law proposed in this regard would damage seriously the position of many communities and industries which depend upon this form of transportation. We submit that no legislation eliminating the bulk commodity exemption for water transportation contained in section 303 (b) of the Interstate Commerce Act should be reported out of the House Interstate and Foreign Commerce Committee or reported by your subcommittee to the full committee without the most complete examination of the facts and consequences in public hearings.
Accordingly, to assist you in determining whether such hearings should be held, what their subject matter should include, and what time should be scheduled for hearing witnesses in opposition to this feature of the report of the Presidential Advisory Committee, we have prepared an outline of the case in opposition to the elimination of the dry-bulk exemption by witness category which the waterways council and its allies would like to present when and if hearings are held. As can readily be seen from this outline of testimony which is attached, it contemplates appearances by witnesses in 20 separate categories dealing with as many different phases of the problem and would probably call for the appearance of from 50 to 75 persons.
I realize it may be impossible for you or your subcommittee to inform us now as to your plans for hearings and action in this session. However, I hope that it will be possible for you to advise me as to the procedure contemplated and an anticipated time schedule so that our plans for assembling witnesses for the hearing can be matured in adequate time. Any information you can give us on the procedural plans of the committee bearing on this problem will be greatly appreciated. Sincerely yours,
DAVID A. WRIGHT, Chairman, Waterways Council Opposed to Regulation Ertension.
OUTLINE OF CASE IN OPPOSITION BY WITNESS CATEGORY 1. Testimony by official or officials of Waterways Council Opposed to Regulation Extension. This would outline the case in opposition to the legislation and provide an organized background into which the testimony of subsequent witnesses in opposition could be fitted.
2. Submission of brief by waterways council entiled "Analysis of Legislative History of Section 303 (b) of the Interstate Commerce Act of 1940.” This consists of some 16 pages and has been prepared.
3. Brief to be submitted by waterways council developing the facts and law concerning the impact of regulation extension on the restriction of competition and developing the proposition that the legislation would substitute a regulated cartel for a system of free competitive enterprise.
4. Testimony of AWO representative. This testimony would analyze in detalled fashion the growth in traffic in bulk commodities on the inland waterways, since 1939, the savings incident thereto, and the entry into the business of many new operators, techniques of operation, and equipment.
5. Testimony of expert witness on comparative costs and rates. The principal point of this witness would be to demonstrate that the increase in cost per tonmile of bulk commodity movement on the inland waterways under free competition has been much less than the increase in costs of other forms of regulated transportation.
& Testimony of technical expert from barge and towboat building industry. The point of this testimony would be to delineate developments in new types
of equipment for the handling of dry-bulk tonnage and spell out their significance in cost savings and speed and quality of service.
7. Testimony of grain shippers.
12. Testimony of National Industrial Traffic League, Eastern Industrial Traffic League, and Ohio State Traffic League.
13. Testimony of National Association of Small Business.
14. Testimony of representatives of Northwest Towboat Association, American Merchant Marine Institute, New York Towboat Exchange and Harbor Carriers Association of the Port of New York, Transportation Association of America, Illinois Manufacturers Association, Illinois Agricultural Association.
15. Testimony of representatives of National Rivers and Harbors Congress. New York State Waterways Association, Mississippi Valley Association, Gulf Intracoastal Canal Association, Chicago District Waterways Association, Ohio Valley Improvement Association, Upper Mississippi Waterways Association, Red River Improvement Association, Inland Empire Waterway Association.
16. Testimony of witness from the Kansas City area, to discuss future waterway developments in that area and the need for open competition to reap full advantages of anticipated development.
17. Testimony of witnesses representing chambers of commerce, port author. ities, or municipal representatives along the upper Mississippi. The principal point of testimony of these witnesses would be the discrimination their communities would suffer if the act extending regulation to bulk movement on the inland waterways was passed with the exemption being maintained for the Great Lakes. It is suggested that the following cities be represented : St. Paul Clinton
And cities along the Illi-
nois River Dubuque
Fort Madison Savannah (Ill.)
Keokuk 18. Testimony or statements from various local chambers of commerce along the inland waterways system concerning the economic injury their communities fear from the elimination of the bulk-commodity exemption--this group of witnesses should be from points along the Ohio and lower Mississippi River system, particularly where industrial plants have located because of the waterways or there are active community programs designed to develop industrial location.
19. Testimony of several large shippers who do not operate their own fleets to testify that they will have to acquire fleets or suffer severe competitive disadvantages in event the bulk-commodity exemption is eliminated.
20. Testimony of representatives of several small- or moderate-sized chemical companies, small- or moderate-sized steel companies concerning the disadvantages that would accrue to them in event regulation is extended because their larger competitors have or will acquire private fleets.
STATEMENT OF ALVIN SHAPIRO, VICE PRESIDENT, AMERICAN MERCHANT MARINE
INSTITUTE, INC. The American Merchant Marine Institute is an organization representing 55 steamship companies which operate vessels of all categories in the foreign and domestic trades. A substantial number of our members operate vessels in the domestic commerce and therefore have a direct interest in the national transportation policy enunciated in these bills.
Those of our members who are certificated water carriers in intercoastal service are also members of the Intercoastal Steamship Freight Association. The Intercoastal Steamship Freight Association has submitted its views separately on the proposed legislation. We wish to endorse and support most of the views presented by the ISFA. In addition, in connection with trades other than the intercoastal trade, we submit specific comment with respect to five aspects of H. R. 6141.
REPEAL OF BULK COMMODITY EXEMPTION The institute is unalterably and vigorously opposed to section 14 of H. R. 6141 which would repeal the dry bulk commodity exemption contained in section 303 (b) of the Interstate Commerce Act, as amended.
The Presidential Advisory Committee on Transport Policy and Organization aims at relaxing Federal regulation of railroads. This, it believes, is reasonable in light of the fact that transportation media are in vigorous competition one with the other. It also has as its basic theme the notion that the fundamental economic aspects of any transportation media should be allowed to manifest themselves to their greatest possible advantage. In connection with the bulk commodity exemption, however, H. R. 6141 reverses the course and aims at increased regulation. It would, in fact, burden water carriers engaged in trades other than the intercoastal trade and prevent them from servicing shippers on the basis of fundamental economies water transportation offers for a dry bulk commodity. Moreover, removal of the dry bulk commodity exemption ignores the fact that such deep-sea water carriers in the domestic trade frequently operate in the unregulated deep-sea foreign trade in direct competition with foreign-flag vessels. Imposing greater regulation on such carriers, including the filing of actual rates, would tend to make it more attractive for such carriers to operate in the foreign trade. Thereby, potential service in our domestic area may be reduced. Repeal of the dry bulk commodity exemption would, of course, seriously limit the area of operational choice now available to a shipowner as between domestic and foreign trade.
The dry bulk commodity exemption should not be repealed since this type of commodity is carried to a far lesser extent by the railroads than by the water carriers on account of the ability of the water carriers to transport large quantities of dry bulk commodities at rates substantially lower than those which the railroads would be obliged to charge because of their greatly higher operating costs. Most of these commodities could not stand a higher rate. To repeal the dry bulk commodity exemption applicable to water carriers, in order that the railroads might participate in such transportation, would only result in increasing the price to the consumer and decreasing the return to the producer. Certainly this could not be construed as a regulation of the transportation industry in the interest of the national economy.
DEFINITION AND RATE PUBLICATION OF CONTRACT CARRIERS BY WATER The institute is opposed to the redefinition of the term "contract carrier by water" as contained in section 13 (b) of this bill. Such a redefinition would have the effect of reclassifying for the purposes of the act certain contract carrier services as common carrier operations. As the result of such reclassification, numerous contract services would no longer be eligible for exemption by the Interstate Commerce Commission from regulation which is now accorded them by section 303 (e) of the act. Such services would thereby be exposed to unfair rate competition on the part of the railroads.
The institute also is opposed to the amendment in section 16 of the bill which would require the filing and publication by contract carriers of their actual rates, charges, and regulations affecting transportation under their contracts. This appears to us to be another means of removing part of the exemption to which contract carriers are now justifiably entitled. The filing and publication of actual rates is intended for the benefit and protection of the shippers. This protection is not required by shippers using contract carriers, in view of the fact that the shippers know with a high degree of accuracy the level of reasonable charges. They are able, therefore, to arrange or refuse transportation offered by contract carriers depending on whether or not the charge is considered reasonable or unreasonable. The proposed amendment to require contract carriers to file and publish their actual rates would be impracticable for the reason that most agreewents for contract carriage are negotiated and the prices fixed on short notice. The factors governing the fixing of the rate vary and consequently cannot be anticipated by the shipowner. Unless the shipowners acts quickly, he may lose a return cargo. The publication and filing of rates is a time-consuming process, sometimes involving many days, and shippers cannot always await the publication and filing of such rates.
The proposed amendment to require filing of rates by contract carriers would also subject charter hire rates to review by the Interstate Commerce Commission.
Under section 302 (e) a shipowner becomes a contract carrier by chartering