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Commission has been that of a regulator. For the Commission to "foster and encourage," rather than "promote" competition, would be more in harmony with its regulatory function.

It is suggested that in lieu of the proposed language, the following language should be substituted:

SEC. 2. The national transportation policy preceding section 1 of the Interstate Commerce Act, as amended, is amended to read as follows:

"It is hereby declared to be the national transportation policy of Congress-"to encourage under the free-enterprise system of dynamic competition, the development of a strong, efficient, and sound national transportation industry which will at all times remain fully adequate for national defense, the postal service, and commerce;

"to foster and encourage: (1) Competition between modes of transportation as well as among carriers by each mode; (2) technical innovations; (3) development of new rate and service techniques; (4) continually improving operating and managerial efficiency; (5) full use of facilities and equipment; and (6) the highest standards of service, safety, economy, and efficiency with resulting benefits to the transportation use and the ultimate consumer, with reasonable rates and charges which are free of unjust discrimination, undue prejudice, preference or advantage to localities, shippers, receivers, kinds and types of traffic or modes of transportation;

"to cooperate with the several States and the duly authorized officials thereof, to fairly and equitably regulate the transportation industry in a manner consistent with the public interest."

All of the provisions of this Act shall be construed, administered, and enforced with the view of carrying out the above declaration of policy (R. 1062–1064).

UNITED FRESH FRUIT & VEGETABLE ASSOCIATION
(Durward Seals)

Nothing can be done under the proposed revised policy which could not be done under the existing statement, except the former would encourage by silence the unfair competitive practices which are now prohibited. In lieu of language interpreted by the Commission and the courts, new clauses would be added which will require construction. It is feared that the net result would be the aggrandizement of the strong and the submergence of the weak. The present policy should be left unaltered (R. 1118).

WATERWAYS FREIGHT BUREAU

(Harry C. Ames)

The members of the bureau, water common carriers operating on the Mississippi-Ohio Rivers, and tributaries, including the Gulf-Intracoastal Canal, object to the proposed amendments with respect to the national transportation policy. The first attempt to subject water carriers to regulation was opposed by water carriers on the ground that it was railroad inspired, with the ultimate intent of eliminating any competition by water carriers. The Mississippi Valley Barge Line Co., represented by the witness, supported reasonable regulation of water transportation if equal protection were afforded to both rail and water carriers. If the proposed legislation is enacted, the fears of those who opposed regulation will be realized. The harmful effects of rate cutting by railroads with the purpose of eliminating water-carrier competition were discussed effectively by former Commissioner Eastman in his concurring expression in Petroleum from New Orleans (194 I. C. C. 31) (R. 478-480).

The provisions of the present act have been fair to all types of carriers. The proposed amendments, in effect, would give rail carriers more freedom than they now have to cut competitive rates, and the pertinent provisions of the proposed bill would curtail materially the power of the Commission to deal with such reductions. The proposed new policy would delete the prohibition against "unfair or destructive competitive practices" and substitute vague expressions, such as the establishment of rates to reflect "full competitive economic capabilities" of the various carriers. The railroads are now endeavoring to put their carload rates on an exact parity with bargeload rates. The industry has no doubt that "full competitive economic capabili ties" will be translated by the railroads into rates which will divert all of the traffic now handled by the barge lines to their service (R. 481).

WATERWAYS FREIGHT BUREAU

(C. E. Childe)

The present national transportation policy, encouraging by regulation a healthy development of each type of transportation, to give the public the best possible service at the lowest possible cost, is sound. The public can get the benefit of the lowest possible transportation costs only in the form of rates of each mode of transportation, reflecting those costs, including a fair margin of profit for the carrier. The services of all types of transportation are in fact valuable to the public only to the degree that rates, considering convenience and reliability, provide transportation at the lowest possible costs. Rates of water carriers necessarily reflect their costs, since lower costs and lower rates are the only inducement they offer to attract traffic. Railroad rates do not bear a consistent relationship to the cost of service. The railroad policy of making rates in accordance with what the traffic will bear inevitably creates discriminations. These must be kept within bounds by regulation to avoid excessively high rates on the one hand, and low rates on the other, which are destructive alike to competition between shippers and competition between carriers (R. 1643). Letting down the bars to still further competition and a wider spread between the noncompetitive rates, so-called, and competitive, would be injurious to the public as a whole and to the carriers as well. What would happen would be substantially the establishment of two sets of rates in the railroad pricing system. The competitive traffic would pay about one-half or less than one-half the rates of the noncompetitive traffic. Noncompetitive traffic cannot stand any such difference as that, and a system of half prices on competitive traffic, or less than half prices, would not work out in the public interest (R. 1664-1665).

Additional opponents

Burlington (Iowa) Shippers Association, Inc., F. L. Partridge. (R. 784).

California Farm Research and Legislative Committee, Charles S. Gubser (Member of Congress) (R. 806).

Columbia Basin River Operators (R. 1614-1615).

Commission of Public Docks of the City of Portland, Oreg., Thomas P. Guerin (R. 1716).

Intercoastal Steamship Freight Association, Harry S. Brown (R. 1042).

International Brotherhood of Teamsters, Dave Beck (R. 1363). John I. Hay Co., John O. Innes (R. 1692-1694).

National Council of Farmer Cooperatives, (R. 1685-1686).

National Retail Dry Goods Association, Robert H. Smith (R. 1004). National Rivers and Harbors Congress, Overton Brooks (Member of Congress) (R. 1607).

New York State Waterways Association, Inc., J. Frank Belford, Jr. (R. 1609).

North Atlantic Ports Conference, A. C. Welsh (R. 996).

Port of Coos Bay (Oreg.), Inc., Allen G. Terry (R. 1717).

Public Service Commission of Wisconsin, A. Wilford Larson (R. 517-518).

Truck-Trailer Manufacturers Association, Inc., C. L. Schneider (R. 1342), Marvin J. Barloon (R. 1344).

Union Barge Line, Corp., (R. 1692).

Upper Mississippi Waterway Association, Inc., A. C. Mills (R. 1615).

Vancouver (Wash.), Chamber of Commerce, Inc., Ray H. Anderson (R. 1716-1717).

Virginia State Ports Authority, D. H. Clark (R. 997).

III. MAXIMUM-MINIMUM-SPECIFIC RATE POWER

Provisions of Interstate Commerce Act

Section 15 (1) of the Interstate Commerce Act provides that whenever the Commission, after full hearing, upon complaint or on its own initiative without complaint, is of the opinion that any individual or joint rate, fare, or charge whatsoever demanded, charged, or collected by any common carrier subject to part I of the act (relating to the regulation of railroads, certain water carriers, oil pipelines, and express and sleeping car companies), or that any individual or joint classification, regulation, or practice of such carrier, is or will be unjust, or unreasonable, or unjustly discriminatory, or unduly preferential, or prejudicial, or otherwise in violation of any of the provisions of part I, it may determine and prescribe what will be the just and reasonable individual or joint rate, fare, or charge, or the maximum or minimum, or maximum and minimum, to be charged, and what individual or joint classification, regulation or practice is or will be just, fair, and reasonable.

Section 15 (3) of the act provides that the Commission may, after full hearing, upon complaint or upon its own initiative without complaint, establish through routes, joint classifications, and joint rates, fares, or charges, applicable to transportation by carriers subject to part I, or by carriers by railroad subject to part I and common carriers by water subject to part III, or the maximums or minimums, or maximums and minimums, to be charged, and the terms and conditions under which such through routes shall be operated.

Section 216 (e), 307 (b) and (d), and 406 (b) of the act give the Commission authority similar to that contained in sections 15 (1) and 15 (3) with respect to rates, fares, charges, classifications, regulations or practices of common carriers by motor, common carriers by water, and freight forwarders.

Section 6 (11) (b) of the act authorizes the Commission, among other things, to establish proportional rates, or maximum or minimum, or maximum and minimum proportional rates by rail to and from ports on waterborne traffic.

Section 13 (4) of the act provides that whenever the Commission finds, after full hearing, that any rate, fare, charge, classification, regulation, or practice made or imposed by authority of any State with respect to a carrier subject to part I of the act causes any undue or unreasonable advantage, preference or prejudice as between persons or localities in intrastate commerce on the one hand, and interstate or foreign commerce on the other hand, or any undue, unreasonable, or unjust discrimination against interstate or foreign commerce, it may prescribe the rate, fare, or charge, or the maximum or minimum, or maximum and minimum, to be charged, and the classification, regulation, or practice to be observed, in such manner as, in its judg ment, will remove such advantage, preference, prejudice, or discrimination.

Section 406 (f) of the act gives the Commission similar authority with respect to any rate, charge, classification, regulation, or practice of any freight forwarder made or imposed by authority of any State.

Section 1 (4) of the act makes it the duty of every common carrier subject to part I to establish reasonable through routes with other common carriers by railroad and with common carriers by water subject to part III, and to establish reasonable rates, fares, charges, and classifications applicable thereto.

Section 1 (5) of the act provides that all charges made for any service rendered or to be rendered in the transportation of passengers or property, or in connection therewith, shall be just and reasonable, and prohibits and declares unlawful every unjust and unreasonable charge for such service or any part thereof.

Section 1 (6) of the act makes it the duty of all common carriers subject to the provisions of part I to establish, observe, and enforce just and reasonable classifications of property for transportation, with reference to which rates, tariffs, regulations, or practices are or may be made or prescribed. This duty also extends to just and reasonable regulations and practices affecting classifications, rates, or tariffs, and all other matters relating to or connected with the receiving, handling, transporting, storing, and delivery of property. Every unjust and unreasonable classification, regulation, and practice is prohibited and declared to be unlawful.

Similar duties and prohibitions applicable to carriers subject to parts II, III, and IV are provided for in section 216 (a)-(d), section 305 (a)-(b), and section 404 (a) of the act.

Amendments proposed by H. R. 6141 and H. R. 6142

Section 7 (a) of H. R. 6141 and H. R. 6142 would amend section 15 (1) of the act so as to remove the Commission's power to prescribe "the just and reasonable individual or joint rate, fare, or charge" and the "maximum and minimum," and limit such power to deter mination and prescription of "such just and reasonable minimum or maximum rate, fare, or charge, or such relationship, classification, regulation, or practice," necessary to remove the violation.

Section 7 (b) of H. R. 6141 and H. R. 6142 would amend section 15 (3) of the act so as to remove the Commission's power to prescribe the precise joint rate or the maximm and minimum rates.

Sections 11 (e), 17 (a) and (c), and 21 (e) of H. R. 6141 and H. R. 6142 would make amendments to sections 216 (e), 307 (b) and (d), and 406 (b) of the act, relating to rates, fares, charges, etc., of common carriers by motor, common carriers by water, and freight forwarders, in a manner similar to those made by sections 7 (a) and (b) to sections 15 (1) and (3) of the act.

Section 5 of H. R. 6141 and H. R. 6142 would amend section 6 (11) (b) of the act so as to limit the power of the Commission to the establishment of proportional rates, or just and reasonable minimum or maximum proportional rates by rail to and from ports on waterborne traffic.

Section 6 (b) and 21 (e) of H. R. 6141 and H. R. 6142 would amend sections 13 (4) and 406 (f) of the act so as to limit the power of the Commission to the prescription of the just and reasonable minimum or maximum rate, fare, or charge where it finds that a rate, fare, charge, etc., imposed by authority of any State with respect to a carrier subject to part I of the act or a freight forwarder violates the provisions of the act.

As a corollary to section 7 (a) of H. R. 6141 and H. R. 6142, section 3 (a) of such bills would amend section 1 (4) of the act so as to limit the duty of a common carrier subject to part I of the act establishing through routes with other carriers to the making of rates, fares, or charges, and classifications, regulations and practices to be applied in connection therewith, which result in charges that are not less than just and reasonable minimum charges nor more than just and reasonable maximum charges.

Section 3(b) of H. R. 6141 and H. R. 6142 would amend section 1 (5) of the act so as to require that all charges for the transportation of passengers or property be not less than just and reasonable minimum charges nor more than just and reasonable maximum charges, and to declare any other charge to be unlawful.

Section 3 (c) of H. R. 6141 and H. R. 6142 would amend section 1 (6) of the act so as to revise the duty of common carriers subject to part I of the act with respect to classification, regulations, and practices in order to conform such duty to the amendments made by section 3 (a). Sections 11 (a)–(d), 15 (a)–(b), and 20 of H. R. 6141 and H. R. 6142 make comparable amendments to related provisions of parts II, III, and IV of the act.

Purpose of amendments

The purpose of the amendments is to repeal the express authority of the Commission to fix specific and "maximum and minimum" rates, and limit the regulatory authority of the Commission to determination of reasonable maximum or minimum rates. As a corollary to the amendments, the bills modify duties of common carriers so as to require establishment of rates which do not result in less than just and reasonable minimum nor more than just and reasonable maximum charges.

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