of transportation should be discriminated against. The object of the pending bill is to try to put all methods of transportation on an equal basis. If it will not do that we shall have failed in our effort.

"Mr. PEPPER. Mr. President, I really meant to say when I spoke a moment ago, if the Senator will further yield, that when the Senator referred to the various means of transportation being equal

"Mr. TRUMAN. Equal before the law.

"Mr. PEPPER. If that is what the Senator meant by the expression he used, very well.

"Mr. TRUMAN. Yes, that is exactly what it means (84 Congressional Record 5958).

"Mr. WHEELER. I say to the Senator, as I said a moment ago, when this legislation is enacted it will be found to be beneficial because we are stating that it is the policy of the Congress of the United States that the Interstate Commerce Commission shall treat each and every one of these forms of transportation upon an equal basis; and no language could be written into law that more clearly directs that that should be done than we have done in the Interstate Commerce Committee (84 Congressional Record 6073).

"Mr. WHEELER. *** It is not a question of helping the railroads; and I think it ought to be clear that the bill is not introduced primarily with the idea that it will help the railroads. The statement has been made repeatedly that the object of the bill is to help the railroads. The object of the bill is to help the railroads insofar as we can correct some undesirable practices and speed up the work of the Interstate Commerce Commission. The bill seeks to give equality to the railroads in the same respect in which we give equality to everybody else. I do not think the Senator from North Carolina, who is noted for his fairness, can say to the American people that we want the railroads in a straitjacket with reference to their rates, but that the water carriers, their competitors, should be free. If the Senator takes that position, then I say there is only one thing we ought to do. If we are not to regulate the water carriers, if we are to let them resort to any practice they wish to follow, including rebates and everything else, then let us say to the railroads of the country, "We will repeal the law regarding the regulation of your rates." Let us turn them loose; let us go back to the law of the jungle and let the best man win. Who would suffer in the long run? It would be the shippers of the country, the farmers, and the miners, about whom the Senator is now speaking" (84 Congressional Record 6135).

In introducing the bill to the House, Congressman Wolverton, one of the bill's managers, declared:

"The one and only thought that dominated the committee was to formulate legislation that would be helpful to all forms of transportation and in the public interest. * * * Nothing could more clearly set forth the fundamental purpose of this legislation and the desire to preserve the inherent advantages of every form of transportation than the declaration of this committee in the bill as to what should be our national policy in this important matter. Permit me to read from the bill. (Congressman Wolverton here read the declaration of policy.)

"That declaration of policy is the foundation upon which this bill has been drawn. In no particular does any provision of this bill deviate from it in the slightest degree. Each provision and all of them taken together do nothing other than make that declaration effective as a national policy. With the administration of the act in accordance with the spirit and intent of the act no unfair or unjust advantage can be gained by one means of transportation over another (84 Congressional Record 9769).

Finally, the conference committee agreed to a bill in the form in which it was enacted. It contained of course the national transportation policy; the amendment to the ratemaking rules for each form of regulated transportation under which the Commission could only consider the effect of rates on the movement of traffic "by the carrier or carriers for which the rates are prescribed;" and the proviso to the antipreference provisions in each part of the act. But this bill, as we have seen, did not contain the Miller-Wadsworth amendment. This amendment, it will be recalled, would have required the Commission to accept reasonably compensatory rates as proposed by any form of transportation, and

it was turned down only for the reason, as expressed in the Commission's report, that it was "not necessary in order that the public at large may enjoy the benefit and economy afforded by each type of transportation." (Please see pp. A3A4, supra.) In reporting the bill, the conference committee agreed. It said (86 Congressional Record 10172):

"The conferees are unanimously in harmony in the viewpoint that the inherent advantages of each type of carrier should be preserved for the benefit of the Nation. Legitimate regulation must look to the protection of the economic advantage of each type of carrier against destructive competition of the other. No carriers should be required to charge unreasonable rates for the benefit or purpose of compelling diversion of traffic to a competitor. [Emphasis ours.] Thus did the Congress make it clear that since water rates and truck rates were not to be regulated in the interest of the railroads, railroad rates were not to be regulated in the interests of either the water carriers or the trucks. At no point in the long legislative histoy was there the slightest indication that, for the protection of a competing form of transportation, another form would be denied the right to establish reasonably compensatory and nondiscriminatory rates and thus, in effect, be forced to hold a rate umbrella. According to the Congress, the public was just as much entitled to competitive railroad rates as to competitive water and truck rates.

APPENDIX B

[From the Wall Street Journal, July 16, 1956]

RIVERBANK BOOM-CHEAP TRANSPORTATION AND POWER DRAW MORE PLANTS TO WATERWAYS-GLIDDEN LOOKS FOR BIG RISE IN BARGE TRAFFIC; SLEEPY CALVERT CITY, KY., AWAKES-COMPETITION CUTS RAIL RATES

(By Roger W. Benedict, staff reporter of the Wall Street Journal)

There's an industrial boom surging along the banks of the Nation's navigable waterways.

Last year, manufacturers and public utilities picked waterside sites for a hefty $6.5 billion worth of new plants-more than 3 times the 1954 total. In the first 6 months of this year, they stepped up this pace, earmarking $3.6 billion for construction along waterways.

What's back of the riverbank boom? Industry's postwar urge to decentralize has sent companies scurrying around the United States looking for new plant sites. Two assets are common to all waterway sites: Low-cost transportation and an ample water supply. These advantages have grown even more alluring as rail and truck freight have risen and water shortages have gripped many parts of the Nation. Some water sites, too, offer sources of cheap hydroelectric power.

The rush to the rivers is a repetition of early United States history. In the 18th and early 19th centuries, towns and industries huddled near rivers, a major source of transportation, power, and even communication. With the spread of railroads and highways, the Nation's inland waterways-28,996 miles of navi gable rivers and canals-began to dwindle in importance. But their comeback now is well underway.

COMPETITION CUTS RATES

Mammoth 20,000-ton barge tows moving up and down the waterways can haul as much freight as 400 rail cars or 1,000 trucks at rates as low as one-third the cost by other means of transportation. The competition of barge lines means that rail and truck rates in river towns are also lower than in cities away from the water.

The industrial growth along the waterways has brought a 213 percent increase in barge traffic on the inland waterways since 1946, and volume this year is running well ahead of the record 87.5 billion ton-miles of freight hauled in 1955. The inland waterways' share of the Nation's freight loads rose to 7.3 percent in 1954 from 2.6 percent in 1943, excluding the share carried by Great Lakes shipping.

The waterways boom has lead to a rapid growth in barge lines, too. The current inland waterways fleet includes 18,110 towboats and barges, up 1,043 from 1950, and most inland shipyards are back-ordered into 1958.

WATER TRAFFIC RISES

"We have so much barge traffic going in and out of here, that the home office calls me admiral," grins husky, hearty Anthony L. Ascik, who runs Pittsburgh Metallurgical Co.'s big new ferroalloy plant at Calvert City, Ky. Half of all raw materials used at the plant and half of its products moved by barge, he reports, and water traffic at the firm's docks is now more than 11 times what it was 3 years ago.

Center of the inland waterways boom has been the busy Ohio River and its 8 navigable tributaries, which have gained $9.3 billion worth of new industry since 1950.

Other booming waterway areas: A stretch of less than 10 miles along the Mississippi River between New Orleans and Baton Rouge has acquired $850 million worth of new plants since World War II. More than $500 million worth of industry has settled along the upper Mississippi between Cairo, Ill., and St. Paul, Minn., in the postwar period. The Gulf Intracoastal Waterway and connecting rivers and canals have gained a lion's share of the $1.2 billion chemical industry and $1.1 billion oil-refining industry on the gulf coast of Texas. A few of the big new waterway plants built or announced in the past 5 years: Olin Mathieson Chemical Corp.'s $90 million aluminum plant at Clarington, Ohio; Kaiser Aluminum & Chemical Corp.'s $220 million worth of aluminum plants at Ravenswood, W. Va., and $60 million alumina plant at Baton Rouge, La.: American Cyanamid Co.'s $55 million chemical plant at New Orleans; Texas Co.'s $44.5 million refinery at Lockport, Ill.; Lone Star Cement Co.'s $35 million plant at Lake Charles, La.; Bowater Paper Co.'s $52 million newspaper mill at Charleston, Tenn.; Crane Co.'s $25 million titanium plant at Chattanooga, Tenn.; Allied Chemical & Dye Corp.'s $22 million chemical plant at Moundsville, W. Va., and $24 million nitrogen plant at Omaha, Nebr., and Dow Chemical Co.'s $20 million plant at Baton Rouge, La.

EXPANSION ON WATER

Dwight P. Joyce, chairman and president of Glidden Co., says, "We intend to keep most of our future expansion on the water, because of the great potential there. We make extensive use of water transportation now for bringing in raw materials and shipping out our chemical products, and we believe that barge traffic will increase greatly in coming years."

D. A. Rhoades, vice president and general manager of Kaiser Aluminum & Chemical, notes: "In the integrated production of aluminum, economic water transportation is essential to provide a direct flow of raw material between major production units." Kaiser will barge alumina from plants at Baton Rouge and Gramercy, La., up the Mississippi and Ohio Rivers to the $220 million worth of reduction and fabricating plants it is building at Ravenswood, W. Va., he reports. "In the chemical industry, particularly in the manufacture of heavy industrial chemicals, the primary advantage of a waterside site is the lower transportation cost afforded by moving both incoming raw material and outgoing finished products in large bulk shipments by barge," says F. L. Linton, comptroller of Allied Chemical & Dye, which has 45 waterway plants and is building 2 more. Many companies located on the waterways operate their own barge fleets. Last year Wheeling Steel Corp. hauled 2.25 million net tons of coal for its steel mills in its barges, up from 1.5 million in 1954, and tonnage in the first 6 months of 1956 was 100,000 tons ahead of 1955.

Among other companies operating barge fleets are: Crucible Steel Corporation of America, Jones & Laughlin Steel Corp., Lone Star Cement Corp., Marquette Cement Corp., Shell Oil Co., Socony Mobil Oil Co., Inc., Standard Oil Co. (Indiana), Standard Oil Co. (New Jersey), Standard Oil Co. (Ohio), and United States Steel Corp.

WATER USE RISES

In these days of water shortages, the steady flow past waterside plants is another weighty advantage for the waterways. Last year industrial firms used 60 billion gallons of water a day, 6 times their daily intake in 1900, and are expected to need 115 billion gallons a day by 1975. Public utilities in 1955 used 30.8 billion gallons daily, more than 11 times what they used each day in 1900. An idea of the water available for industry in the rivers: Daily flow of the Mississippi past New Orleans is 300 billion gallons a day.

When the advantage of cheap transportation and ample water are added to other important factors, the result is an almost irresistible lure to many com

panies. The Ohio Valley adds low cost coal-generated power and proximity to eastern markets to its water assets, and the New Orleans-Baton Rouge area links up ocean transportation, low-cost natural gas-generated power and large sources of petroleum, sulfur, and other raw materials with its water advantages.

Industrialization has brought big changes for both people and towns along the waterways. Consider Kentucky's Calvert City, until a few years ago a sleepy unincorporated hamlet of 300. Today, it bustles with more than $77 million worth of new industrial plants, employing 1,500 workers, and is planning for a population of 10,000 by 1965.

HELP FROM A DAM

At Calvert City, the big extra factor was provided by the Federal Government with construction of nearby Kentucky Dam, part of the TVA system. To get the dam, and its assets of low-cost power, flood protection for industrial sites, locks for barges, and recreation facilities for workers, however, took a long bard fight by Luther Draffen, country storekeeper at Calvert City, and other western Kentucky leaders.

Mr. Draffen began his battle for the dam and industrial development of Calvert City in the years after World War I when farmers in the area lost the market for the dark tobacco they had exported to Germany, Italy, and France, and 5,000 farm people migrated north to work in the industries of Detroit, Chicago, and Akron.

After the dam was constructed, he and Charlie Hall, a young Paducah merchant, began preparing brochures, writing letters and taking industrial site hunters on tours of the area. Finally, in 1948, they hit the jackpot.

First came Pennsylvania Salt Manufacturing Co., which has now invested $20 million in 6 chemical plants, employing 250. Next came Pittsburgh Metallurgical, which has expanded its original 3 ferroalloy furnaces to a $7.5 million 10-furnace plant, employing 640, and is now building 3 more units including the largest electric ferroalloy furnace in the world.

NATIONAL CARBIDE MOVES IN

In 1951, National Carbide division of Air Reduction Co. moved in with a giant $18 million plant, employing 400. Two years later, B. F. Goodrich Co.'s chemical division moved in with a $13.5 million plant, employing 165, to combine acetylene from National Carbide and hydrochloric acid, sulfuric acid, and caustic soda from Pennsalt to make vinyl chloride and acrylonitrile. Last year, General Aniline & Film Corp. put up a $7 million plant with 108 employees, to take National Carbide's acetylene and hydrogen from Pennsalt to produce drugs and artificial blood plasma.

This year, Air Reduction has completed a $5 million chemical plant to use its own acetylene in making vinyl acetate monomer, and another $1 million plant to turn out oxygen and rare gases. American Aniline & Extract Co. also put up a $1 million polyvinyl alcohol plant using chemicals from the new Air Reduction plant.

Nor has this chain reaction of industrial growth ended. Three major chemical companies have acquired more than 1,200 acres of land in Calvert City for future industrial sites.

In the case of Calvert City, industrial development got a big push from hydroelectric power from Kentucky Dam, but the resurgence of coal as a source of electric power has been an even more important part of the waterway boom. Even Calvert City gets large amounts of power now from TVA's steam generating plants--National Carbide alone uses 120,000 kilowatts-hours, compared to Kentucky Dam's capacity of 160,000 kilowatt-hours.

John W. Evers, president of Commonwealth Edison Co., Chicago, told the convention of the National Coal Association last month, "We are barging as much coal as possible." The utility burns 11 million tons of coal a year, and Mr. Evers notes that rail rates for hauling coal are up 15 cents a ton in the last 3 years, while the cost of coal has dropped 3 cents a ton.

INDUSTRIAL DISTRICTS

To get in on the waterway boom, many cities are developing industrial districts on the water. Memphis has lured 23 companies to its $3 million 980-acre Presi dent's Island project since 1952, and is now starting development of another 6,800 acres on the mainland across from the island district.

The Federal Government has appropriated $551,000 for preliminary engineering work on a project that would open up the 3,100-acre Columbia Bottoms north of St. Louis for a proposed industrial district to be operated by the bistate agency, Joint Illinois-Missouri Authority. Other river cities with ambitious industrial development projects: Pittsburgh, Minneapolis, St. Paul, Baton Rouge, New Orleans, Dubuque, Iowa, and Syracuse, N. Y. (New York State Barge Canal). Barge line executives point up how all this rising waterway activity is causing an upsurge in their industry.

Capt. A. C. Ingersoll, Jr., president of Federal Barge Lines, Inc., says he expects 1956 volume to exceed the record 3,191,811 tons hauled last year, up 21 percent over 1954 volume. "May was the best month in our history," he reports.

"I would be surprised if the growth of the barge industry is less than 4 percent per year for the next 10 years," he adds, "and it may grow as fast as 15 percent a year." Federal added a new towboat and 25 new barges last year, recently launched a big modern towboat and has 25 barges on order.

WASHINGTON, D. C., May 9, 1956.

Hon. OREN HARRIS,

Chairman, Transportation and Communications Subcommittee,
House Committee on Interstute and Foreign Commerce,
House Office Building, Washington, D. C.

DEAR MR. CHAIRMAN: I beg leave to transmit herewith an expression of views on behalf of four Midwest meatpackers-Oscar Mayer & Co., the Rath Packing Co., George A. Hormel & Co., and John Morrell & Co.-in opposition to certain phases of H. R. 6141, being legislative expressions of the so-called Weeks report. Yours truly,

WARREN H. WAGNER.

VIEWS OF CERTAIN MIDWEST MEATPACKERS ON H. R. 6141 AND S. 1920

PRELIMINARY

H. R. 6141 and S. 1920, bills to amend the Interstate Commerce Act, purport to reduce to legislative form the proposals contemplated by the so-called "Weeks report" or Cabinet Committee report.

The views thereon expressed herein are those of Oscar Mayer & Co., the Rath Packing Co., George A. Hormel & Co., and John Morrell & Co., shippers, operating meatpacking plants at Madison, Wis., Davenport, Waterloo, Ottumwa, Fort Dodge, and Estherville, Iowa, Austin, Minn., Fremont, Nebr., Dallas and Amarillo, Tex., Sioux Falls, Mitchell, and Madison, S. Dak., and Philadelphia, Pa. These packers are not among the so-called Big Four.

At the above points we have slaughtering plants. In addition, certain of us operate large processing plants at the following cities: Atlanta, Ga.; Birmingham, Mobile, and Montgomery, Ala.; Charlotte and Winston-Salem, N. C.; Chattanooga and Memphis, Tenn.; Chicago and Decatur, Ill.; Dallas, Houston, and San Antonio, Tex.; Fresno, Los Angeles, Oakland, and San Francisco, Calif.; New Orleans, La. ; Philadelphia, Pa. ; and Seattle, Wash.

There are a number of phases of this legislation which will undoubtedly be opposed by other shippers, and to avoid reiteration we will not discuss all of them herein.

Of course, changes in the provisions of the present statute will impel litigation to ascertain their validity, meaning, scope, and application-expensive to the small carrier or shipper compared with the availability of extensive staffs of the larger carrier or shipper. Is that necessary?

The consequences of proposed changes should be considered from the legal or practical standpoint, administration or functioning of the Commission, as well as upon the rights of shippers.

If the railroads and the motor carriers are turned loose so that they can reduce their rates with impunity, we would unquestionably revert to the "laws of the jungle," as stated by the Commission in its "comments" to Congress on this question. Throatcutting and rate wars would be worse than prior to 1887, when special rates were published in so small type that powerful microscopes were needed, or when special noncompensatory rates were put in for a day to accommodate a given shipper.