case. It should not have, probably, any effect upon the Lincoln, Nebr., case, so far as publication of the law is concerned, but there should be a law Mr. HARRIS (interposing). What is the need to have a law then? Mr. BRYAN. There should be a law to protect the shippers against the very things which the Department of Justice is trying to prove the carriers have been doing and which I do not believe they can prove. Mr. HARRIS. Suppose the Supreme Court were to rule that the suits in Lincoln, Nebr., were not properly brought, then you would not have any necessity for this legislation, would you? Mr. BRYAN. No; you would not. Mr. HARRIS. I want to ask you one other question. Mr. BRYAN. We do not want to be on the tethering hooks that long. Mr. HARRIS. How long has that been pending out there; about 2 years? How much longer it is going to Mr. BRYAN. About 2 years now. be I do not know. Mr. HARRIS. In your opinion-and you have studied this matter and you are familiar with rate classifications and rates, does this legislation in any way affect the controversies that existed over a long period of years on what is the so-called freight rate discriminations between the zones throughout the United States? Mr. BRYAN. No; not in my estimation. Mr. HARRIS. Would it give any zone or area, in your opinion, any advantage whatsoever, on freight rates over other areas? Mr. BRYAN. It would not in any way affect any such situation as you have in mind or as stated. Mr. HARRIS. Would it have any affect whatsoever on the making of rates, that is, joint rates or through rates, on shipments going from the official zone, so-called, to, say, the southwest zone? Mr. BRYAN. No, sir; it would not. Mr. HARRIS. Would not have any bearing on that whatsoever? Mr. BRYAN. No, sir. Mr. HARRIS. That is all, Mr. Chairman. Mr. HALL. Thank you very much, Mr. Bryan. Mr. BRYAN. Thank you. Mr. HALL. The next witness will be Mr. J. K. Hiltner. Mr. Hiltner, will you please state your full name, address, and the name of the company you represent for the record? STATEMENT OF J. K. HILTNER, GENERAL TRAFFIC MANAGER OF THE UNITED STATES PIPE & FOUNDRY CO., BURLINGTON, N. J. Mr. HILTNER. Mr. Chairman and members of the committee, my name is J. K. Hiltner. I am general traffic manager of the United States Pipe & Foundry Co., Burlington, N. J. I am appearing in support of the passage of H. R. 221. In voicing these supporting views I am representing the Atlantic States Shippers Advisory Board, the New Jersey State Chamber of Commerce, the Cast Iron Pressure Pipe Institute, and this company. The Atlantic States Shippers Advisory Board is an organization composed of approximately 4,000 shippers and receivers of freight located in the States of New Jersey, New York, Pennsylvania, Delaware, Maryland, and Virginia. Its purpose is to study transportation problems and endeavor to work out such problems with the carriers involved without resorting to litigation. While carriers' representatives are always present at the meetings of these boards, I want to make it clear to this committee that the carriers' representatives attend meetings of the boards in an advisory capacity solely and have no voting power. I am chairman of the legislative committee of the Atlantic States Shippers Advisory Board. I am chairman of the industrial traffic committee of the New Jersey State Chamber of Commerce. As the functions of State chambers of commerce are so well known I will not attempt to define those of the New Jersey State chamber. The Cast Iron Pressure Pipe Institute is an organization composed of all manufacturers of cast iron pressure pipe in the United States. I am chairman of the traffic committee of the institute. All of these organizations favor the passage of H. R. 221 at the earliest possible moment. This bill deals with the application of the antitrust laws to carriers subject to the regulation of the Interstate Commerce Commission. It does not grant carriers immunity from the antitrust laws. It seeks to relieve the uncertainty and confusion which has arisen in recent years in the application of the antitrust laws to regulated transportation. Agreements between carriers, entered into under the provisions of H. Ř. 221, are subject to the approval of the Interstate Commerce Commission. After approval by the Commission carriers, parties to such agreements, will be removed from the operation of the antitrust laws with respect to the making and carrying out of such agreements. In order to insure sufficient safeguards the bill provides that the Interstate Commerce Commission may prescribe any conditions it deems necessary before granting approval and may terminate or modify the conditions at its discretion. H. R. 221 carries a provision which shippers deem exceedingly important. In no way does it prevent independent action on the part of any carrier. The present system of rate making, whereby rate proposals are referred to committees of interested carriers for consideration, has been brought about by shippers' demands that mediums be constituted through which matters such as the question of rates, fares, routes, et cetera, may be expeditiously and fairly disposed of. The system was worked out first between the National Industrial Traffic League and the railroads. It was later extended to the motor carriers and, to some extent, to water carriers. It is of long standing, is highly perfected, and is religiously observed by the carriers. The establishment of joint rates and through routes, which are necessary under the Interstate Commerce Act, could not be accomplished without consultation or arrangement among the carriers. The carriers could not possibly respond to the duties imposed upon them by law if each individual carrier were to act independently. The establishment of through routes and joint rates under any condition calls for consultation, conference, and for many acts of a joint or cooperative character. No one opposed to the bill has attempted to explain how rates and schedules affecting rail shipments moving over the lines of connecting carriers can be established other than through some means of agreement between participating carriers. There is no other method by which this can be done and shippers are fully aware of this fact. If the present system of establishing rates were abolished, rate making would fall into a chaotic state with severely disastrous results to both shippers and carriers. H. R. 221 proposes to preserve the rights, privileges, and opportunities of shippers which are traditional and without which we cannot do. All who are dependent on transportation know that under practices which have been current for 40 years shippers and receivers of freight are given advance notice of proposed changes in rates, train schedules, routes, et cetera, with an opportunity to appear, make their views known and insist that their interests be taken into account and protected. This practice cannot continue if the antitrust laws, as interpreted by the Department of Justice, are to prevent conference and action in concert among carriers regarding these matters. There must be a means set up whereby carriers and shippers can discuss matters of common interest and reach sensible conclusions regarding them. Without such a means of consultation and conference it would be impossible for any shipper to know at any time what or when action to his disadvantage is contemplated or threatened by any carrier or carriers. In the Transportation Act, 1940, Congress has declared that the act must be so administered that there shall be no unjust discriminations, undue preferences or advantages or unfair and destructive practices. If the existing system of rate making is discontinued this mandate of Congress could not be carried out and the industrial and commercial interests of the Nation would again be subject to those chaotic conditions which in former years spelled disaster to many railroads and shippers. Those most seriously hurt in such a situation would be the small shippers. Those whom I represent want committee rate procedure maintained in full force. They are opposed to anything which will destroy or seriously interfere with this procedure unless and until a better method of procedure is established. We know of no better method. When all the facts are placed before you, which facts we believe will tend to prove that this legislation is such that should receive priority handling, we trust that all efforts will be made to enact this proposed legislation into law at the earliest possible moment. Mr. HALL. Does that complete your statement, Mr. Hiltner? Mr. HARRIS. On page 2 of your statement, you said this bill does not grant carrier immunity from antitrust law. Now, that is not altogether a fact, is it? Mr. HILTNER. I probably should have said complete immunity. If I put the word "complete" in there, it would be proper. Mr. HARRIS. What you mean to say, then, I assume, is that this does not in any way grant carriers immunity from antitrust laws except as provided in this act? Mr. HILTNER. That is correct, sir; and I think that I made that statement. Mr. HARRIS. And the purpose of this proposal is to clarify the situation to prevent further suits being brought against carriers throughout the nation on the actions and procedures that they have practiced over a period of many years? Mr. HILTNER. No. I would not quite say that. If I remember correctly, and I think Mr. Bulwinkle will bear me out in this because I am getting to be quite a fixture at these hearings, legislation was started, to clarify this situation, long before your antitrust suits were filed; so that it was simply an attempt then to make legal or to give congressional approval of something which had been going on for 40 years. Mr. HALL. Mr. Hiltner, would this express your thoughts, if you had said that it does not grant impunity from the antitrust laws as they were interpreted for the past 25 years and until these suits were brought? Mr. HILTNER. That is correct, sir. Mr. HARRIS. How could your statement be true, that you just made? Mr. HILTNER. That would be correct up until this time. Mr. HARRIS. You have just now said that this bill was proposed before the suits were brought. Mr. HILTNER. That is correct, because some of these things were foreseen by shippers. Mr. HARRIS. Announcements were made in the press that such suits were probably going to be brought. Mr. HILTNER. I do not remember that, because I think before the war we had a Bulwinkle bill, if I remember correctly. Mr. O'HARA. Not this bill, though? Mr. HILTNER. No. Mr. HARRIS. I believe the strongest argument that I have heard, Mr. Hiltner, on this subject is contained in the paragraph beginning on the bottom of page 2 of your statement, and on page 3. Now, that is exactly what you seek, and I am sure that you are sincere in saying that. It seems to me it is as appropriate a statement as I have heard made on the subject. Mr. HILTNER. Thank you very much, sir. Mr. HARRIS. You live in New Jersey? Mr. HILTNER. Yes, sir. Mr. HARRIS. Now, it is quite noticeable that we have a great many people who are interested in this from what is called the official zones. I do not know, but there will probably be some from the other zones. I hope so, in order that we can get the viewpoints of all concerned. However, you are familiar with the controversy that some claim political and some claim otherwise, but it has actually been a controversy for many years over the so-called freight rate discrimination? Mr. HILTNER. Yes, sir. Mr. HARRIS. That is the official zone, the southern zone, and the Southwest and so forth? Mr. HILTNER. That is correct, sir. Mr. HARRIS. In your opinion, and you are very familiar with this proposed legislation, would this in any way affect that situation at all? Mr. HILTNER. No, sir; it would not. Mr. HARRIS. Would it apply to the Southwest zone equally and the same as it would apply to the official zone? Mr. HILTNER. Yes, sir; and interzone as well. Mr. HARRIS. In your opinion, it would not give any zone or area any advantage over the so-called freight rate question of any other zone or area? Mr. HILTNER. Yes, sir. Mr. HARRIS. That is all, Mr. Chairman. Mr. O'HARA. If there was an advantage, though, which was arrived at by violation of the antitrust law, what would you do in that if this bill became law? Mr. HILTNER. I think that I do not quite understand your question. Mr. O'HARA. I just followed up Mr. Harris' question with reference to the fact that this would not give one zone any advantage over another zone. Now, I ask you, if that did occur and if there was an advantage which resulted from a conspiracy or from violation of the antitrust laws, and we passed this bill, just what redress would the affected zone have? Mr. HILTNER. We are not attempting to put any new practices in effect, and I know what you have in mind, and that is your southern rate case and a few of these kind of cases; but that is a question for the Interstate Commerce Commission to decide. This bill certainly does not lend or give Official territory any more advantage than the southern territory had. Mr. O'HARA. What we are talking about, and I think it is a fact and I will ask Major Bulwinkle if it is not a fact, that the Lincoln suits were brought before this bill was introduced. Mr. BULWINKLE. No, sir; it was not. I have introduced the bill, first, for the record, applying to rates. It came about because the Interstate Commerce Commission had for some years before requested that there ought to be some action. There were rumblings in the Department of Justice, and there were rumblings in the Department of Justice when we passed the Civil Aeronautics Act of 1938; and Mr. Eastman suggested to me then, and I was on the subcommittee that drafted the Aviation Act, and I put in the amendment providing that there should be impunity, that the carriers should have impunity from the provisions of the antitrust law as to agreements when approved by the Civil Aeronautics Board. That went through. It was patterned after the Merchant Marine Act of 1916, and the question was that there were no suits started. There may have been rumblings. You voted for it and voted for the National Transportation Act of 1940? Mr. O'HARA. I was not here then, Major. Mr. BULWINKLE. You would have voted for it if you had been here. That provided and stated that that should be done. Mr. O'HARA. That is a broad statement, and I prefer you would let me speak for myself. Mr. BULWINKLE. I was just suggesting that I knew what would happen. Mr. O'HARA. I suppose it is easy to find out when the Lincoln suits were started. Mr. BULWINKLE. The Lincoln suits were started 2 years ago this spring. I think that that is right. Mr. HARRIS. About the same time you introduced the bill. Mr. BULWINKLE. I introduced it before that. Mr. O'HARA. It must have been awful close, Major. |
