Mr. HALL. The record will show when the bill was introduced. Mr. BULWINKLE. That was before the suits, or the Georgia suits, were started.

Mr. HALL. Thank you very much, Mr. Hiltner.

The next witness is Mr. J. G. Scott.

Mr. Scott, will you please give your full name and the company that you represent?

STATEMENT OF JACK GARRETT SCOTT, GENERAL COUNSEL OF THE NATIONAL ASSOCIATION OF MOTORBUS OPERATORS, WASHINGTON, D. C.

Mr. ScoтT. My name is Jack Garrett Scott, and I am general counsel of the National Association of Motorbus Operators.

Because of my previous appearance before this committee on similar legislation, I have prepared a statement which is brief. I think it will conserve time of the committee if I read that statement. It will not take very much time. I will read it rather than try to extemporaneously explain the views of the industry.

Mr. HALL. You may proceed.

Mr. SCOTT. The National Association of Motorbus Operators represents about one thousand common carriers of passengers by motor vehicle, including the members of affiliated State associations. Its members are both large and small, and are from every part of the country.

We appear in support of S. 110 and H. R. 221, and strongly urge favorable action upon them both by this committee and by the House. It is a matter of vital importance to the future welfare of our industry, and, in our view, to the public which we serve.

Before the Motor Carrier Act of 1935 was enacted, the intercity motorbus industry was in a confused and demoralized state. This was due principally to two causes: First, the rate situation was entirely unstable, and the industry was constantly upset, to its detriment, by destructive rate wars. Second, the service given to the public was far from satisfactory because there was no real degree of integration or cohesion in the industry, and consequently no adequate system of traffic interchange between carriers.

The Motor Carrier Act and the cooperation of the carriers subject to its provisions have gone a long way toward curing both of these situations. Rate regulation by the Interstate Commerce Commission has brought a high degree of stability to the rate structure and has eliminated the past destructive wars over fares and charges.

Also, because the statute required motor carriers of passengers to establish through routes and reasonable joint rates and divisions with other such carriers, there has resulted a degree of unity in service which never before was possible. From both of these developments, the public has been the primary beneficiary. Yet neither of them could have been accomplished, under the statute or otherwise, without cooperation and joint action by the carriers.

The intercity bus industry is predominantly one of small carriers. There are about 1,600 such carriers subject to the Interstate Commerce Act. Of these, only about 220 have gross revenues of $100,000 a year or more. In the years before the war, there were only about 140 or

145 carriers with revenues above that figure. All of the rest are comparatively small enterprises which do not have and cannot afford traffic departments or rate experts.

Together, however, intercity motor carriers, both large and small, serve practically every community in the United States, many thousands of which are not served by any other commercial passenger carrier. Working together, by conference and joint action, they have now established a system of interchange and a related fare structure whereby a traveler may go by bus from almost any point in the United States to any other point in the country. And this can be done over a wide variety of alternate routes, at the choice of the passenger, and at low cost.

Without such joint action, attainment of these results would have been impossible, and without continued joint action, they cannot possibly be maintained in the future. If joint action in these fields is unlawful and must be discontinued, one of two things must happen: Either every carrier would be compelled to publish his individual tariff between points on his own line and the many thousands of other points in the United States served by him and his connections, or the statutory requirements would have to be violated and the industry returned to the conditions which existed in the years prior to 1935.

The first of these cannot be done, for reasons both financial and practical. The great majority of the bus carriers cannot afford individually to seek out every other carrier and go into all of the other infinite detail necessary to prepare individual tariffs, and even if they could, conference and agreement would be necessary before the information which must go into a tariff could be attained. The second alternative is an illogical one, for reasons which are readily apparent. We wish to continue to comply with the requirements of the Interstate Commerce Act. The provision here pertinent is both sound and salutary, and has proven so in practice. Our situation, in a word, is that we are here asking that one of the bills now before this committee be enacted into law, so that it will be both lawful and possible for our carriers to do in the future what another existing statute already requires us to do.

There is no substance to the proposition which has been frequently made that joint action has served or will serve to increase fares in the motorbus field. The history of the industry shows the exact opposite. In the early days of the industry and before Federal regulation, bus fares ranged from 4 to 6 cents per passenger-mile. In more recent years, and particularly since Federal regulation, the trend of fares has been constantly downward. The average bus fare is now slightly over a cent and a half per passenger-mile.

This downward trend in motor passenger fares is due to several factors, among the most important of which is that our chief competition is and always has been the private passenger automobile. It has been estimated that, in prewar years, about 86 percent of all of the persons in this country who traveled between cities rode in private automobiles. That situation is rapidly being repeated now that new automobiles, are available in quantities. We just cannot meet competition from that source if we increase our fares much higher than the present levels, even if an increase should be authorized by the Interstate Commerce Commission and the various State commissions which regulate us.

Another reason for the consistent decrease in fares is that through joint action of various kinds outside of the rate field, in the development of more efficient equipment, for example, and the use of more businesslike practices as to operations and service, the joint use of terminals, and many others, it has been possible to bring about greater economy in bus operation and at the same time to give far more efficient, safe, and comfortable service to the public.

The history of joint action in our industry, therefore, shows that it has been beneficial, not only to the carriers but, more important, to the public itself, which has profited both in receiving more economical transportation and better service.

What I have said about the need of the motorbus industry for the right to confer and to take joint action, lawfully and under proper governmental supervision, will be particularly important in the next few years ahead. Our physical properties were badly worn by the intensive use to which they were put during the war.

Replacements, in desirable quantities, have not yet been available. Both equipment and fixed properties must be rehabilitated, at a very large cost, as soon as that is possible. Our revenues are declining at a serious rate, with the continuing increase in passenger car operation and the sharp competition which we are receiving from competing commercial carriers. Our basic costs of operation, which have risen most substantially in the past few years, show no signs of declining at any pedictable future time.

If we are to continue to operate in serving the public and in meeting competition, we must bend every effort to reach the utmost economy and efficiency in operation, to eliminate all possible wastes, and to take every advantage of recent mechanical and technological improvements. That cannot be done, practically and effectively, in our view, without joint conference and action.

We should be allowed together to engage in experimental and research efforts, in such fields as mobile radio communication, use of new sources of power, new equipment designs, improved operating methods, and many others. With the enactment of this bill, we could feel free to pursue such courses without fear that we were acting in violation of the law.

We are opposed, of course, to any joint action which would stifle competition, or result in coercion or undue discrimination. But we do believe, for the reasons given, that, in the case of a regulated industry, there is a real and compelling need for joint action in the field of fares and service, under the watchful and competent eye of the Interstate Commerce Commission. Without it, we will necessarily return to the destructive and chaotic conditions which existed prior to Federal regulation, and which the Motor Carrier Act so largely eliminated..

Mr. HALL. Thank you very much, Mr. Scott.

Are there any questions, gentlemen?

Mr. Scott, we are very appreciate of your appearance here.

The next witness will be Colonel Barber. Will you give your full name and address?

STATEMENT OF ALVIN B. BARBER, MANAGER OF THE TRANSPORTATION AND COMMUNICATION DEPARTMENT OF THE CHAMBER OF COMMERCE OF THE UNITED STATES, WASHINGTON, D. C.

Mr. BARBER. My name is Alvin B. Barber, and I am manager of the transportation and communication department of the Chamber of Commerce of the United States, Washington, D. C.

Since the national chamber's views on the Bulwinkle bill were presented before this committee in 1945, we have on two occasions had opportunity for further check as to the opinions of our membership on the subject. The results strongly confirm the chamber's previous stand in support of the bill.

The first occasion was through a report rendered by our transportation committee in April 1946, in which the following recommendation was unanimously submitted:

Carriers should be clearly empowered to enter into agreements as to rates or service, subject to safeguard's imposed by the regulatory body, and agreements approved by that body should be relieved from the operation of the antitrust laws.

This recommendation was included among others in a declaration on national transportation policy which was sent to referendum vote of our chamber of commerce and trade association members throughout the country in June and July 1946. The declaration was adopted by a vote of 2,251 in favor to 75 opposed. A number of member organizations submitted explanations of their votes and of these only one expressed opposition to the recommendation which I have quoted.

There were 75 votes opposed against the whole of the declaration which included quite a number of different propositions, and from our knowledge of the question and the attitude of some of our member organizations, we know that the opposition represented by that small minority of 75 votes was, according to our best judgment, not related to this carrier agreement question. As I have indicated, there was just one organization which filed an explanation saying that it was opposed to the carrier agreement matter. With this single exception, all the expressions which have come to us from our member organizations on this legislation have been definitely favorable.

The second occasion to which I referred was at the chamber's recent annual meeting held in Washington, April 28 to May 1 of this year, when, because of the current importance of the subject, a further declaration advocating carrier agreement legislation was adopted. This declaration reads as follows:

The welfare of transportation companies and of the shipping and traveling public calls for early removal of the present uncertainty regarding the legality of long-established conference procedures respecting rates and services. There should be prompt action on pending legislation which, subject to safeguards specified therein and such others as may be imposed by the Interstate Commerce Commission, would relieve from the operation of the antitrust laws conference agreements approved by that body.

The declarations which I have quoted support the principles of both the Bulwinkle bill, H. R. 221, and the Reed bill, S. 110.

I wish to mention that the two declarations by our organization originated in different ways and were voted on by different procedures. I wish to say that any of our members had an opportunity, who were

opposed, to so indicate. The first of the two declarations was initiated by our transportation committee, which is made up by a balanced representation of shippers and all forms of carriers, and was acted on by the chamber's membership through referendum.

The second of the two resolutions was initiated not by the transportation committee but by the chamber's over-all policy committee, which is responsible for recommending annual meeting action on matters of concern to all fields of business. The policy committee this year included no representatives of transportation carriers. The declaration on carrier agreements proposed by the policy committee was unanimously adopted by the annual meeting, which included nearly 2,000 delegates of both small and large business organizations from all parts of the country.

Since allegations have been made in recent public debates that endorsements of the pending legislation by chambers of commerce have been largely pro forma and do not truly represent the views of those organizations, I should like to say that we consider such allegations entirely unjustified. In my prepared statement, Mr. Chairman, there was a line left out which I will insert. Insofar as concerns their voting in determination of national chamber policies, our members so often object to and not infrequently defeat recommendations with which they do not agree, that anyone familiar with our procedure could hardly be led to believe that the voting is perfunctory. Quite a number of propositions submitted by referendum or put up before annual meetings have been defeated in recent years. In the case of the Bulwinkle-Reed bill we believe its practically unanimous endorsement by many hundreds of different chambers of commerce and other business organizations represents a well-informed judgment which is deserving of great weight. The subject is one which business users of transportation understand. Their support for the pending legislation reflects their knowledge that it is distinctly in the interest of shippers, of small shippers even more than large, that it provides the fullest protection for the public interest and that it is essential to avoidance of chaotic conditions in transportation.

I might add in some of the public debates I have been perfectly amazed at the statements which reflected lack of knowledge of this subject by some people that I thought ought to have known what they were debating about.

The preponderance of the voice in our organization is that of shippers, and it is their opinion that it is more to the advantage of small shippers than large shippers. Our people who understand that, believe that for the reason that if you had the antitrust laws applied as we understand the Department of Justice would like to apply them, and no conference were allowed among carriers, then the individual shipper would deal with the individual carrier. In that case, the large shipper who is able to maintain a competent traffic department would be in a better position to negotiate with different carriers and work out beneficial rates in his business; whereas under the present system, with the conference rate making, as was so well explained by Mr. Brown here this morning, the small shipper has got ready access to the rate committees, and he is notified of what is going on. He does not have to have a traffic department to keep track of a multitude of different changes. He is notified of the ones that are coming up,