The House Committee on the Judiciary has under consideration the so-called Chandler bill, H. R. 3704, which is designed to facilitate railroad reorganizations. The league favors this bill, and recently appeared at hearings of the subcommittee advocating its passage. On the other hand, in the bill now under consideration by this committee, H. R. 4862, there is a proposal beginning at page 185 of the printed bill for amendment of section 77 of the act of July 1, 1898, and the creation of a reorganization court. The league is opposed to the creation of such court. There are pending today in various stages a number of railroad reorganization proceedings, many of which are near their final conclusion before the Commission. A tremendous volume of evidence has been taken in these proceedings, and it does not seem desirable that all of these matters should be dumped into the lap of a new court not yet appointed and which would have to start all over with the process of hearings and arguments. MISCELLANEOUS PROPOSALS In pending bills and in various programs for additional legislation there are many matters of relatively minor importance on some of which the league has united with the position of the carriers, while on others it is definitely on record that no change in the present law seems to be required. LAND-GRANT RATES The league has approved the repeal of land-grant rates for reasons which were fully stated by the chairman of our legislative committee in his appearance before this committee on June 21, 1938, in connection with a bill, H. R. 10620, Seventy-fifth Congress, which was subsequently passed by the House. Shippers have a real direct interest in the repeal of land-grant rates, not simply because of the burden of such rates on the railroads but because of the adverse effect on competitive traffic. LONG-AND-SHORT-HAUL CLAUSE The league has approved the repeal of the long-and-short-haul clause of the fourth section, and bills for such repeal have passed in the House on two occasions, upon favorable report by this committee. INTRASTATE RATES The league has repeatedly gone on record as to the extent of control by the Interstate Commerce Commission over intrastate rates, as now provided in section 13 of the Interstate Commerce Act. It is our position that no change should be made in the present law. Mr. CROSSER (presiding). As acting chairman, let me explain that the chairman informed me that your time would expire at 11:45. That hour has been reached, and we have two other witnesses. Mr. DAY. All right. I would be willing to give way here, Mr. Chairman, but could it be understood that I may incorporate the balance of my statements in the record? Mr. CROSSER. How much is left of your statement? Mr. CROSSER. I think no one would object to that. You may do so. GRADE CROSSINGS Mr. DAY. The league has gone on record in favor of Federal and State legislation intended to relieve the railroads of the burden of cost of eliminating grade crossings in excess of the direct benefits to them. BRIDGES OVER NAVIGABLE WATERS The league also favors relieving the railroads of undue burdens in connection with bridges over navigable waters in excess of the direct benefits to them or in excess of reasonable contractual obligations under the statutes or permits by which the construction of the bridges was authorized. REPARATION The league repeatedly has gone on record regarding the provisions of sections 8 and 16 of the Interstate Commerce Act affecting the jurisdiction of the Commisison in the matter of reparation. We oppose the repeal of the power of reparation or any shortening of the Statute of limitations. RECODIFICATION OF THE ACT The bill introduced by Chairman Lea on March 8, 1939, H. R. 4862, is not only understood to carry out the main proposals of the President's Committee of Six, but further represents a complete recodification of the law, consolidating part I of the act (governing rail carriers) and part II (relating to motor carriers) and adding new provisions with regard to all forms of transportation. The league considered the question of recodification of parts I and II of the Interstate Commerce Act at its recent meeting in Washington, and decided, I believe unanimously, that any such recodification should be opposed at this time, largely on the ground that it contemplates some important and far-reaching changes in existing laws, the effect of which should in the public interest be weighed carefully. We submit that for this reason, and because of the many pressing problems confronting this committee and the Congress it would be impossible during the remainder of this session to give proper consideration to this matter. Our statement of the league's position on various major questions which are under consideration will perhaps suffice to indicate what our position would be on various sections of this bill, H. R. 4862, dealing with those subjects. LEA OMNIBUS BILL-H. R. 2531 REORGANIZATION OF THE COMMISSION The Lea omnibus bill, introduced January 13, 1939, H. R. 2531, provides in part I of title I for the reorganization of the Commission by creation of three statutory divisions thereof, enlarging its membership from 11 to 19, and proposes to redistribute the functions of the Commission. I have already indicated that the league is definitely opposed to these proposals and to the provisions of title II which provides for the creation of a Transportation Administrator 130931-30-pt. 4-32 to be appointed by the President and operating independently of the Commission. POOLING Part II of title I proposes to amend the pooling provisions in section V of the act, so that the Commission would have power to impose pooling arrangements on carriers without their consent. This the league opposes. REGULATION OF WATER CARRIERS The league is opposed to the provisions in part II of title I of this bill enlarging the jurisdiction of the Commission to cover regulation of water carriers upon the inland, canal, or coastwise waterways of the United States. MINIMUM RATES FOR ALL TYPES OF TRANSPORTATION It is opposed to the provisions of part IV of title I for amendment of the Interstate Commerce Act to cover the coordination of minimum rates for all types of transportation. Thank you. Mr. CROSSER. Thank you. STATEMENT OF EDGAR S. GORRELL, PRESIDENT, AIR TRANSPORT ASSOCIATION OF AMERICA, CHICAGO, ILL. Mr. CROSSER. We will hear Colonel Gorrell. Mr. GORRELL. Mr. Chairman, my name is Edgar S. Gorrell. I appear here on behalf of the membership of the Air Transport Association of America. With your permission, I will hand to the reporter one of our letterheads that gives the name and address of our association, the names of the officers, directors, and member companies, and the objects and purposes of the association. Mr. CROSSER. You may do that. Mr. GORRELL. With your permission, may that be inserted in the record? Mr. CROSSER. Yes, sir. (The information referred to is as follows:) AIR TRANSPORT ASSOCIATION OF AMERICA 1217 Field Building-135 South La Salle Street-Telephone Randolph 1148 Edgar S. Gorrell, president. Croil Hunter, vice president. Chicago, Ill. Fowler W. Barker, secretary and treasurer. Board of directors: T. W. Braniff, Jack Frye, C. Bedell Monro, W. A. Patterson, E. V. Rickenbacker, Thomas Fortune Ryan, III, C. R. Smith. Members: American Airlines, Inc., Boston-Maine Airways, Inc., Braniff Airways, Inc., Chicago & Southern Air Lines, Inc., Continentail Air Lines, Inc., Delta Air Lines, Eastern Air Lines, Inc., Inland Air Lines, Inc., Mid-Continent Airlines, Inc., National Airlines, Inc., Northwest Airlines, Inc., Pan American Airways System, Pennsylvania-Central Airlines Corporation, Transcontinental & Western Air, Inc., United Air Lines Transport Corporation, Western Air Express Corporation, Wilmington-Catalina Airline, Ltd. Associate member: Canadian Airways, Ltd. OBJECTS AND PURPOSES SECTION 1. The objects and purposes of this Association are: 1. To promote and develop the business of transporting persons, goods, and mail by aircraft between fixed termini, on regular schedules, and through special service, to the end that the best interests of the public and the members of this Association be served. 2. To advocate the enactment of just and proper laws governing the air-line business. 3. To promote closer relations with and cordial cooperation among the members. 4. To promote friendly relations with, and to secure the cooperation and good will of the public. 5. To improve the transportation service rendered by its members. 6. To promote the construction of proper airports and airways aids over such routes as will best insure benefit to the public and the air-line business, and to promote the maintenance, repair, and improvement of all airports used by air-line operators. 7. To promote the establishment of necessary terminals and connecting schedules. 8. To cooperate with all public officials in securing the proper enforcement of all laws affecting air transportation. 9. To promote aviation safety in general. 10. To do all things tending to promote the betterment of air-line business, and in general do everything in its power to best serve the interest and welfare of the members of this Association and the public at large. "By common action to advance the air-line industry for better service to the public and for the national defense." Mr. GORRELL. We appear, Mr. Chairman, in opposition to the legislation that is now pending before you. In 1937 I was on the stand before your committee for 4 days, and in 1938 for 1 day, and I then sought thoroughly to cover much of the subject which you are now considering. I shall now attempt not to repeat anything that I said at that time. If need may arise, my former testimony is available to your committee and can be referred to or incorporated in the record. Mr. Chairman, I shall attempt to speak orally and very briefly this morning. Principally I desire to say that we agree with the conclusions on this subject reached by the Interstate Commerce Commission in their letter to your chairman under date of March 20, 1939. If I may, I will read the two paragraphs containing their conclusions to which I have just referred. The Commission believes Mr. CROSSER. From what page are you reading? Mr. GORRELL. I am reading from page 6 of the mimeographed letter and from page 3 of the printed version thereof. Of course, when I say that "we agree," I mean we agree on behalf of the Air Transport Association to the final conclusions reached as to air carriers and as to not disturbing the Civil Aeronautics Authority. The Commission believes that the recommendation of the Committee of Three in regard to this matter was basically sound, but that it is not, as a practical matter, important to change the present regulatory plan with respect to air carriers. * * I now skip to the end of the paragraph. Air carriers compete with other types of carriers in long-distance transportation and in the carriage of mail and express, but such competition is of lesser consequence. The Civil Aeronautics Authority is newly created and we now see no sufficient reason for disturbing it. I skip over to page 7, the last paragraph of the page. This is on page 4 of the printed version. Impartiality in the regulation of different types of carriers is promoted by giving a single agency comparable jurisdiction and responsibility for each type. Under H. R. 2531 the responsibility of this Commission would be primarily and chiefly for railroads and motor carriers, but it would have superseding authority to fix minimum rates (the vital factor in competition) for carriers for whom other governmental bodies would continue to have primary responsibility. Such a situation would invite doubts as to impartiality. Divided or superimposed jurisdiction also duplicates effort and is likely to engender confusion and ill will. With your permission I will later explain our reasons for agreeing with these conclusions of the Interstate Commerce Commission. Some 20 years ago this spring I was first privileged to be associated with legislation for civil aviation. I was then a representative of the United States at the First International Convention on Air Navigation in Paris in 1919. Since that time I have tried to follow the subject of such legislation more or less closely. Approximately 20 years ago, the Congress first tackled the subject of legislation for civil aviation. That was the inception of the airmail system in May 1918. H. R. 4862 AND H. R. 2531 ARE UNWISE LEGISLATION Based upon 20 years of experience, and based upon the intensive studies that we have made, and that your committee and the Congress has made, especially in the last 5 years, it is our judgment that H. R. 4862 as applied to air carriers is unwise, and we think it was drafted in unwise form, because of an innocent misunderstanding on the part of the railroads as to the factors entering into civil air transportation. H. R. 2531, the other bill now pending before you is a much milder bill, but it also would be unwise legislation as applied to air carriers, for reasons which the Interstate Commerce Commission has explained even better than I can, including the reason of the confusion that would be created. It is true we compete to some extent with the railroads, but it is also true that every day, even at this very minute, we are increasing the volume of business done by the railroads by shortening the traveltime element of commercial travelers and by keeping them in closer touch with their customers. We increase the tonnage of the railroads, the steamship lines, and the motor carriers. For instance, one personal illustration: I took over a factory not so many years ago which shipped goods to South America but had a very small volume of business there. With the opening of the air line to Buenos Aires I was able, by using the air mail and having my representative travel by air, to give the railroads some 6,000 tons of freight and the steamships some 3,000 tons of freight per year, and also to contribute some increase of their passenger and mail business. Air transport is a mere "speck in the sky," as Dr. Splawn has said, but that speck in the sky provides a large volume of tonnage for the railroads, the motor carriers, and the steamships, arising from the activities which are made possible by the existence of air transportation and which would not be possible without the development of air transportation. |