estopped from giving rebates, and from discriminatory practicesdiscriminatory and preferential practices. Mr. MAPES. Would you apply that to the trucks, too? Mr. FELTUS. I would apply it to the trucks. I am not here to attack any particular form of transportation. It is a fight between themselves. We want all of it. But, we do not think one form of transportation should be penalized. Mr. MAPES. You would allow cutthroat competition? Mr. FELTUS. It would soon take care of itself. It would take care of itself. Mr. MAPES. It never has. Mr. FELTUS. Well, from the standpoint of the railroads, but so far as the public is concerned, they have gotten along pretty well after legislation of the fourth section, the original act. They have gotten along pretty well as far as the public is concerned, up to 1920. Mr. MAPES. Does the public benefit by the ruination of a transportation system? Mr. FELTUS. They were not ruined then. Mr. MAPES. The truckers came in before this committee and asked for legislation. Mr. FELTUS. Surely. You will find some of the boat lines doing that too. They are not satisfied with having a free highway, but they want to have regulation so that they will not cut each other's throats. It is the most ridiculous thing I ever heard of. Mr. MAPES. That is your position, is it, that we ought to do away with regulation both of the railroads and trucks? Mr. FELTUS. I would subscribe to that program, absolutely. I would subscribe to it. The CHAIRMAN. You may extend your remarks in the record, Mr. Feltus. We thank you. MIDLAND COOPERATIVE WHOLESALE RESOLUTION AND LETTER TO HON. Hon. HENRIK SHIPSTEAD, SENATOR HENRIK SHIPSTEAD United States Senator, Washington, D. C. MARCH 20, 1939. DEAR SIR: May we respectfully call your attention to the attached resolution passed by the board of directors of the Midland Cooperative Wholesale at their last meeting. While the resolution speaks for itself, permit me to call to your attention the relationship which this issue has to the present struggle to bring about the completion of the 9-foot channel and to continue the development of river transportation on the upper Mississippi. The proposed regulation of the rates of transportation on the river would be decidedly unfair to the future development of river traffic, inasmuch as the rates would undoubtedly be increased at the behest and in the interest of the railroads. As a landlocked community in the interior of a continent, this section of the United States should encourage every possible means of transportation in order to reduce all types of transportation costs. This, in turn, will reduce the cost of living, the cost of doing business, and the cost of carrying on industry in our section of the country. Should you desire further information on the attitude of the cooperatives regarding this issue, kindly let us know. In the meantime, may we have your assurance that you will do everything in your power to defeat such legislation as would tend to cripple the present development of river transportation? Very truly yours, Also sent to Senator Lundeen, Congressman Youngdahl, Congressman Lea. RESOLUTION Whereas the Midland Cooperative Wholesale and all of its 100,000 members in Minnesota, Wisconsin, and Iowa are vitally interested in and need the several forms of transport now operated on land, water, and in the air; and Whereas all of these forms of transport are necessary to adequate and economical transportation and essential to the national welfare; and Whereas the Midland Cooperative Wholesale is opposed to all legislation which would increase the cost of transportation and therefore increase the cost of living, doing business, and carrying on industry in this part of the Nation; and Whereas the Congress is now considering legislation which will in effect increase the freight cost by all forms of transport to the present high level of railroad rates: Therefore be it Resolved by the Midland Cooperative Wholesale, through its board of directors, meeting at Minneapolis, Minn., March 17, 1939, that its president advise the Congress of the United States, through its respective committees, that it is opposed to all legislation that is designed to defeat in any manner whatsoever the economies of water transportation, and all legislation that can be construed or interpreted as indicating a national policy toward any form of transport that may result in further increases in the freight charge or freight tax against the producers and consumers of the Nation; be it further Resolved, That the president of this association present to the Congress, through its respective committees, the proposal that an investigation be made by the Government of the experience in Europe with regulation of water transportation, and to this end, that a congressional committee be appointed with adequate power and funds to conduct such an investigation, and that the result thereof be reported back to the Congress before it further considers the enactment of legislation of the type hereinbefore referred to. STATEMENT OF 0. S. BARRETT, VICE PRESIDENT OF THE BARRETT LINE, INC., CINCINNATI, OHIO The CHAIRMAN. We will hear Mr. Barrett. We are a little later in getting started with you than we had expected. Mr. BARRETT. Mr. Chairman and gentlemen of the committee, my name is O. S. Barrett, vice president of the Barrett Line, Inc., Chamber of Commerce Building, Cincinnati, Ohio, operating a fleet of boats and barges on the waters of the Mississippi River system. I appear here as president of the Mississippi River System Carriers Association in opposition to the type of legislation represented by the Lea bill, H. R. 2531, the Committe of Six bill. The association I represent is composed of carriers who transport from 80 to 90 percent of the tonnage on our mid-continental rivers. With the exception of the Federal Barge Line, which is not a member of our association, all the important lines and many of the lesser ones belong. With the single exception of the Mississippi Valley Barge Line Co., who are here to state their particular position, the protest I express is the unanimous opinion of all our members. The protest Mr. Bayless and I express are the unanimous opinion of all of our members and, while I approach the matter from the viewpoint of the practical operator, Mr. Bayless is counsel for the association, and his approach of the question is from the point of the attorney. Therefore, you will find no conflict or lapping in our statements. BARGE LINE PERCENTAGE OF TRAFFIC Mr. MAPES. How does the business of the members of your association compare with that of the Government's Inland Waterways Corporation? Mr. BARRETT. I did not quite catch your question, sir. Mr. MAPES. How does the business of the members of your association compare with the business of the Government's Inland Waterways Corporation? Mr. BARRETT. You mean the Government Barge Line? Mr. BARRETT. The Government Barge Line is not a member of our association. They operate on the Mississippi, the Warrior Mr. MAPES. I understand that; but how does the total volume of your business compare with the total volume of the barge line? Mr. BARRETT. I do not know the total volume of the barge line's business. Mr. MAPES. You have some idea? Mr. BARRETT. The total tonnage? Mr. MAPES. You have some idea of it, do you not? Mr. BARRETT. If I had, sir, I would be glad to put it in the record, but I do not have. The total volume of tons on the Mississippi River system was a little in excess of 91,000,000 tons. Now, whatever the annual statement of the Federal Barge Line gives as their tonnage subtracted from that 91,000,000 the privately owned and privately operated fleets do the rest. Mr. MAPES. What do the privately operated fleets do, to put it the other way around? Mr. BARRETT. I am told by representatives of the barge line that they do around 2,000,000 tons, so the privately owned and privately operated fleets would do a business in excess of 89,000,000 tons on the Mississippi River system, handling all kinds of freight. COMMITTEE HAS AUTHORITY TO DETERMINE RAIL DIFFICULTIES Now, Mr. Chairman and gentlemen of the committee, it lies within your power to destroy the services on our rivers without having accomplished anything constructive in relief of the railroads which are in trouble. It also lies within your power to find out just what is the matter with the railroad situation, and to devise the cures. We ask that you do not blindly accept the assertion that the waterways are substantial contributors to the causes of the railroad troubles, but that you consider thoughtfully the protest we bring to you in all sincerity and conviction. We are here fighting for our continued existence, as you shall see. WILL INCREASE THE COSTS OF THE CARRIERS The costs of the carriers will be unnecessarily increased by the volume of records and accounts that will have to be kept. Further, the railroads have always harassed and tried to exhaust water carriers, and the legislation would give them the opportunity they have long sought to call into question before the Commission every rate, fare, or charge proposed by a water carrier. The numerous and lengthy hearings resulting from this legislation and the delays incident to awaiting decisions would make serious inroads into the resources of all the carriers involved, would be ruinous to many of the carriers, and would serve absolutely no useful purpose. Division 5 of the Commission has publicly stated in motorcarrier decisions that regulation is necessarily expensive (M. С. 88149). SEGREGATION OF SERVICES In addition to the costs of hearings and keeping records, which will neither benefit the carrier nor improve service to the public, cost will be further increased by any attempt to segregate the types of services, such as common, contract, or private. Present services overlap into all these types, and the public is benefiting because of the low rates thereby made possible. All the water carrier provisions of the Committee of Six bill are presented on such segregation. Further, although the legislation is proposed on the theory of equality of regulation, the water-carrier provisions of the Committee of Six bill, and the administration of the Motor Carrier Act, the language of which is almost identical with that of the water-carrier provisions, definitely impose particular handicaps on the contract and private carriers. In this respect it is informative to inquire into the orders of the Commission pursuant to the Motor Carrier Act of 1935. The limitations and restrictions imposed on the contract motor carriers by the Commission's order and report Ex parte M. C. 12, April 21, 1937, are ample warning, and a real example of what may be expected to happen to contract water carriers under this regulation. Messrs. Eastman and Caskie, in the report just referred to, said: The underlying purpose is plainly to promote and protect adequate and efficient common-carrier service by motor vehicle in the public interest, and the regulation of contract carriers is designed and confined with that end in view. The report goes on to say: The patent object of Congress is to protect the common carriers against cutthroat competition. Still reading from this report: This appears explicitly in section 218 (b), which enjoins us, in prescribing minimum charges for contract carriers, to give no advantage or preference to any such carriers in competition with any common carrier by motor vehicle subject to this part. That same injunction is contained in section 26 (2) of the Committee of Six bill. The report emphasizes the subordination of contract carriers. It continues: The same thought is found in other provisions, notably section 209 governing the issue of permits to contract carriers as compared with section 207 which has to do with the issue of certificates to common carriers. The test in the latter instance is public convenience and necessity, but in the issue of permits it is consistency with the public interest and the policy declared in section 202 (a). The same difference is found in the Committee of Six bill between section 42 (3) for common carriers and section 43 (2) for contract carriers. This latter paragraph also provides that after permits have been issued the Commission shall attach thereto from time to time * such reasonable terms, conditions, and limitations * as are necessary to carry out the requirements of this Act or those lawfully established by the Commission pursuant thereto. It was on language in the Motor Carrier Act having the same meaning that Division 5 of the Commission issued its order Ex parte M. C. 12 limiting and restricting the contracts of contract motor carriers, thus establishing a precedent which has been strictly followed in administering the Motor Carrier Act, and which would surely be followed in Commission regulation of the contract carriers by water. This knowledge is far from comforting to either carrier or shipper. SECTION 1 The order and report, Ex parte M. C. 12, officially disclose some of the possibilities implicit in section 1 of the Committee of Six bill. This is the policy provson, and its wording is substantially the same as section 202 (a) of the Motor Carrier Act. The need for searching, thorough investigation into the meaning of its vague generalities is revealed by this report, M. C. 12. This is extremely important because so many provisions of the bill, particularly those dealing with contract carriers, refer back to section 1. If it is intended that water carriers be regulated by this or any other commission and that the act establish a policy in respect to such regulation, then that policy should be enunciated in clear, specific, and easily understood terms so the Congress will know what it is promulgating, the public will know what is intended, and the carriers will have some idea as to what to expect. The meaning of the present terms would never be definitely established. Contract carriers are betrayed completely by section 2 (5) of the Committee of Six bill which seems to exempt them. This provision is the acme of meaninglessness as to exemption, but on the other hand, definitely and conclusively grants to common carriers prior rights to any traffic over any route. Shippers on our rivers, whose requirements are now being economically met by facilities of the contract carriers, are to be dragooned by these provisions into a different arrangement. With equal injustice the contract carriers are to be put at the mercy of the hostile Interstate Commerce Commission. Now, if the Congress proposes to give a monopoly to these high cost common carriers presently handling less than 4 percent of the tonnage of the Mississippi River system, then that fact should be phrased so clearly that the shippers and the public in general will be able to understand it and know what is being enacted. Mr. HINSHAW. Mr. Chairman. The CHAIRMAN. Mr. Hinshaw. COMMON CARRIER OPERATIONS ON MISSISSIPPI SYSTEM Mr. HINSHAW. Do I gather from your statement that only 4 percent of the Mississippi River traffic, with the exception of the barge line, is handled by common carriers? |