agreeing to the same identical rates is against the Sherman Act and against the law, so we are fighting it.

Mr. DOLLIVER. I take it from what you said that you have never participated in one of those conferences?

Mr. BOGGESS. No, sir.

Mr. DOLLIVER. And I take it also that from what you say you do not have any suggestion as to any other or better method of arriving at rates?

Mr. BOGGESS. What we want is competition. Let any railroad fix its own rates without hindrance from the other railroads.

Mr. BULWINKLE. Would the gentleman yield?

Mr. DOLLIVER. Let him finish and then I will yield.

You said you wanted competition. Let each railroad fix its own rates without

Mr. BOGGESS. Without hindrance from the other railroads, instead of the railroads getting together and agreeing on the same rate from Washington to New York. or in regard to a commodity, say corn from Omaha to Galveston.

Mr. BULWINKLE. That would apply to services also?

Mr. BOGGESS. Yes, sir.

Mr. BULWINKLE. You are certain of that?

Mr. BOGGESS. Am I against it?

Mr. BULWINKLE. You are certain you want the same conditions to apply to services?

Mr. BOGGESS. My statement was that we are against

Mr. BULWINKLE. You want the railroads to set up and go their own route themselves, as to rates and services. Is that right?

Mr. BOGGESS. Well, we are getting back, Major, to just where we were a while ago.

Mr. BULWINKLE. No. We are back further than we were a while ago.

Mr. BOGGESS. There are certain vicious things. We have no objection to the benign practices. It is only the things that we think violate the law.

Mr. BULWINKLE. Then you want the railroads in the United States and the trucks in the United States and the water carriers in the United States, to be run according to the whim of someone in the Department of Justice?

Mr. BOGGESS. No, sir. We are public servants and charged with the enforcement of the law; when we think that they are violating the law, of course, we step in.

Mr. HALL. Mr. Dolliver?

Mr. DOLLIVER. I yield to Mr. Heselton.

Mr. HESELTON. How do you reconcile your idea about the way the rates should be arrived at with your own statement about the proper and lawful collaboration between the carriers setting up joint rates and establishing routes when you say "Such collaboration and agreement is specifically required if a carrier is under the Interstate Commerce Act, and has been expressly approved by the Supreme Court"? How do you reconcile what you said with that?

Mr. BOGGESS. Joint rates and through routes, of course, we do not object to them at all. The act requires that. Understand, a joint rate is for example the rate furnished from here to Dallas via St.

Louis. It would be by the Baltimore & Ohio to St. Louis, and over the Katy to Dallas.

Those two railroads could get together and make rates as connecting carriers. That is perfectly all right.

Mr. HESELTON. That is all.

Mr. DOLLIVER. That is all, Mr. Chairman.

Mr. SADOWSKI. I think the public is interested in ample and sufficient transportation at reasonable rates. Do you think that this bill will have the effect of bringing this about and particularly will transfer the effect of bringing about lower rates or reasonable rates to the public?

Mr. BOGGESS. No, sir. I think the reverse. The fact that the railroads will be able to get together and make these conference agreements will keep the rates up just as the memorandum stated that I read a while ago about the AAR making the arrangements for rates in regard to furniture. I do not know whether you were here or not.

Mr. SADOWSKI. Do you think that as a result of the agreements that might be made under this bill, that there might be an opportunity to bring about lower rates or more reasonable rates to the public? Mr. BOGGESS. Under this bill?

Mr. SADOWSKI. Yes.

Mr. BOGGESS. No, sir. I do not. I do not think there would be. Mr. HALL. Is that all, Mr. Sadowski?

Mr. SADOWSKI. That is all.

Mr. HALL. Mr. Boggess, you contend that this bill creates a special privilege class. You contend that it will countenance monopoly. If that statement is so, have not predecessors in the Attorney General's office countenanced a special privilege group and have not they countenanced monopoly because this practice has been going on for 25 years?

Mr. BOGGESs. All I can say is the Attorney General, our present Attorney General, and the preceding Attorney General, were opposed to it.

Mr. HALL. I say this has been going on 25 years. If your statement is right that this creates a special privilege group and that this legislation countenances a monopoly and a vicious monopoly, have not predecessors in office, in the Attorney General's office countenanced those two situations?

You can answer that question yes or no.

Mr. BOGGESS. I do not see that I am called on to answer that. I am not here to criticize anybody. Mr. Chairman, I say that respectfully.

Mr. HALL. You must admit then, that at least they were in disagreement with your present position.

Mr. BOGGESS. Well, they might not have had the personnel, especially the Antitrust Division. These prosecutions have been handled by the Antitrust Division. They have handled the cases. Prior to about 5 years ago they had a very small number of men. Personnel was small. They really did not have the personnel to make the investigation. These investigations are very extensive. Mr. HALL. We thank you very much for your testimony. Mr. HARRIS. Mr. Chairman, may I ask a question? Mr. HALL. Yes.

Mr. HARRIS. I do not believe any one has asked this yet.

What is the difference between collaboration in determining rates and conference agreements?

Mr. BOGGESS. There is none.

Mr. HARRIS. You said you favored collaboration, but you do not favor conference agreements.

Mr. BOGGESS. I do not think I said that I favor collaboration. do not object to "benign" collaboration that is the word I used. There are things that are harmless that they could discuss.

I

Mr. HARRIS. I thought I understood you to say on page 4 of your statement:

The new legislation is not necessary to permit proper, lawful collaboration between the carriers on meeting the needs of commerce.

Mr. BOGGESS. Let me find that place, Mr. Harris. Where is that? Mr. HARRIS. That is the first sentence of the paragraph on page 4. Mr. BOGGESS. The key words there are "unlawful collaboration." Mr. HARRIS. And I am asking you what is the difference between lawful collaboration and conference agreement?

Mr. BOGGESS. Lawful collaboration is collaboration over things that are good for the public and where there is no collusion, no agreeing on rates, no agreeing to follow the same practice in regard to services.

Mr. HARRIS. You do not think that one company should discuss with another with reference to improved services?

Mr. BOGGESS. That might be all right to discuss in regard to improved services but to get together and agree that we will follow the same practices in regard to the same service that we have been doing for maybe 20 years and agree on that would be unlawful.

Mr. HARRIS. Are there any standards at all set up for lawful collaboration?

Mr. BOGGESS. I do not know that there are any special standards. Mr. HARRIS. How is the company to know where the demarcation is, then?

Mr. BOGGESS. Where there is collusion they get together and agree among themselves agree to make rates or follow the same course of action, or follow the course that the majority agree on in regard to rates or services, which would be unlawful.

Mr. HARRIS. Is it not the purpose of this bill to provide machinery for drawing a line of demarcation as to what is permissible and what is not permissible?

Mr. BOGGESS. The purpose of the bill it seems, is to get the conference agreements filed and approved by the Commission, and also to get the transportation industry out from under the operation of the antitrust laws, I would say.

Mr. HARRIS. The fact is there would be a question as to whom would determine whether or not these standards in the bill would have been met on an agreement: The ICC or the Department of Justice. Is not the whole that whole question?

Mr. BOGGESS. They would come before the ICC. The part that we object to is that if there is anything wrong about them, or against the law, we have po power to step in and enforce the law.

Mr. HARRIS. That is all.

Mr. BULWINKLE. Mr. Chairman?

Mr. O'HARA. I would like to ask a question.

Mr. BULWINKLE. I am not going to ask any questions. I would like to suggest for the purpose of the record that the Assistant Attorney General give the names for the record of his assistants.

Mr. HALL. What was the question?

Mr. BULWINKLE. No question. I want for the purposes of the record the names of the assistants appearing.

Mr. BOGGESS. There is just one. I do not remember this gentleman (Barton) saying anything to me.

Mr. HALL. We would be glad to have both names.

Mr. BOGGESS. He has not been an assistant. He has been sitting here.

This gentleman is Mr. Samuel Karp.

This gentleman is Mr. Frank L. Barton.

Both of them are members of the Antitrust Division.

Mr. O'HARA. There have been some references to the Lincoln case. Have you filed as a part of your remarks a copy of the complaint filed by the Government in that case with reference to it? What was charged in there? I think it would be appropriate to file it in the record. I would like to have the witness file it.

Mr. BOGGESS. I have not one with me. But I will bring it up in the morning.

Mr. O'HARA. There are some specific references to it.

Mr. BULWINKLE. I think Mr. Chairman, there should be filed with the committee not for the purposes of the record—

Mr. O'HARA. I ask it be made a part of the record, Mr. Chairman. Mr. BULWINKLE. You can make yours, but I am going further than that and ask that

Mr. HALL. Is there any objection on the part of any member of the committee to having the complaint in the Nebraska case spread upon the minutes immediately following the testimony of Mr. Boggess? (No response.)

Mr. HALL. Without objection it is ordered.

Mr. BULWINKLE. I am asking that the Department of Justice furnish the committee with the briefs and with the complaints, the bills, in both cases, the Georgia and the Lincoln, so that we can see.

(The following statements, made before the Senate Interstate and Foreign Commerce Committee, are attached hereto: Statement of Tom C. Clark, Attorney General; Statement of Wendell Berge, Assistant Attorney General; Statement of James E. Kilday, Special Assistant to the Attorney General. Briefs, complaints, and bills in the Lincoln, Nebr., case, and the Georgia case, heretofore mentioned, are to be furnished for the record by Mr. Boggess.)

STATEMENT OF ATTORNEY GENERAL TOM C. CLARK ON S. 110 (FORMERLY THE BULWINKLE BILL, NOW THE REED BILL)

The pending legislation would authorize the Interstate Commerce Commission to approve agreements setting up basic plans of organization and procedures whereby private groups would be empowered to regiment the transportation industry. I am convinced that the proposal before this committee to set up such immunities from the antitrust laws raises a serious question concerning the entire antitrust program.

The policy of the administration, as expressed in the recent President's message to the Congress, is to preserve our system of free enterprise and to enforce the antitrust laws, which are the guardian of the American competitive economy. The pending legislation is a contradiction of that policy.

The antitrust laws are the bulwark of free enterprise. They guarantee the freedom of the market place from the private restraints and restrictions of monopoly. They insure the freedom of all men to compete for trade according to the enterprise, ability, and resources of each, with a minimum of interference from those who would throttle competition. Out of this competitive struggle, the freedom which the antitrust laws seek to protect, has come an industrial development which offers our people the highest standard of living and the maximum economic freedom known to history.

Free enterprise can live only when sustained by faith in the future. For competition rejects status quo for progress, and its course is marked by some waste, by the hastened obsolescence of machines outmoded by new developments freely introduced, by the losses and sacrifices of those who lag behind. From those who fear competition and from those who desire to consolidate favored positions, comes a constant cry for succor from "competitive waste," for insulation and immunity from the strife and uncertainty of the competitive struggle.

While in the field of transportation the Interstate Commerce Commission has been given the power to limit and control railroad rates and practices in many important respects, both the Commission and the courts recognize that under the statutory scheme of regulation the railroads possess wide latitude and are charged with individual responsibility and initiative in the establishment and modification of rates and fares and in the provision of facilities and services. As to those respects in which the carriers are free, competition remains the rule of law in transportation and in those respects the public relies upon competition between carriers for the protection and advancement of the public interest.

The bill now under consideration by this committee would set up machinery that could permit powerful groups to destroy free enterprise in the transportation industry by freeing that industry from restraint of the antitrust laws. I am aware that the immunity from the antitrust laws which the bill would accord under the private agreements between carriers authorized by the bill is made contingent upon the approval by the Interstate Commerce Commission of such agreements. The bill fails, however, to give any assurance that the private power created by such agreements, once they are approved by the Commission, will be susceptible to public control and supervision. It is the things which might be done under these private agreements which threaten the public interest; and it is these very things which the bill shields from the attention of the prosecuting agencies of the public.

These

The Department of Justice is seriously concerned with the extent to which private controls in the railroad industry have already become, even without the sanction of law, a fulcrum upon which private groups have successfully applied pressure to eliminate, competition in other industries, "to create rigid, noncompetitive market relationships," and to preserve the economic status quo. private controls within the railroad industry are now under attack by the Department of Justice. Should the passage of this bill succeed in immunizing such private controls from the antitrust laws, I am fearful that the transportation industry will turn its face from the ideal of free enterprise to a new order of private regimentation. Our experience in the enforcement of the antitrust laws demonstrates that there are powerful influences in the economy constantly seeking rigidity of market control and the elimination of competition. Congressional approval of regimentation in transportation would both accelerate the present drive for the immunization of private controls in other industries, and furnish a mechanism for the indirect extension of such controls. And, because transportation is a basic factor in every industry, our problem in enforcing the antitrust laws in the "free" remainder of the economy would be seriously complicated.

By rejecting this bill the Congress can serve notice to those who seek special immunities that freedom of enterprise will continue to be the heritage of all our people.

It would

The transportation industry constitutes America's biggest business. not be fair to arrange to immunize this big business from the antitrust laws and thereby make this industry the first of a number of big businesses seeking Congressional similar immunity with an ultimate result which leaves large industry immunized and the small industry subject to prosecution.

We emerged from the War with far-flung concentrations of economic power. This is an invariable result of war and is particularly true of our reconversion period. The procedure and group action developed between competitors during the war must not be carried into our peacetime reconversion.

I reiterate now what I said when the Bulwinkle bill was before the last Congress: The Department of Justice cannot recommend this bill.