4. Subparagraph (8) of section 208 (c) on pages 26, 27 does not seem to accomplish the purpose intended by the latter part thereof. We suggest that the word "this" be inserted preceding "paragraph" in line 19, that all of subparagraph (8) following the word "accrue" in line 22 be stricken out, and that in lieu thereof the following be inserted as a separate subparagraph: "(9) The provisions of this paragraph (c) shall take effect 6 months after the approval of this act". This would correspond with the changes suggested in our recent report to you on H. R. 5363, shortening the periods of limitation for filing complaints or actions under section 16 (3) of the Interstate Commerce Act. 5. In line 6 on sheet 27, it is suggested that the word "for" be changed to "of". 6. In section 215 (a) on page 37 provisions are made regarding the consolidation, merger, purchase, lease, or contract to operate water-carrier properties, "or any part thereof". The words quoted might have the effect of preventing one water carrier from acquiring any vessel or other property of another such carrier, however small in amount, without authority from the Commission. It is suggested that the words "or a major portion thereof" be substituted for "or any part thereof", where the latter words appear in lines 8, 15, and 18 on page 37. Similar changes in section 313 (a) of H. R. 5262, relating to the regulation of motor carriers, were suggested in our report to you of February 21, 1935. 7. In line 4 on page 45, it is suggested that "section" be changed to "sections", that the commas after "12" and "16" be eliminated, and that the word "and" be inserted between "12" and "16"; and also that the word "and" be inserted preceding the last word in line 6 on the same page. 8. In line 20 on page 47, the word "and" should be changed to "any." In line 25 on the same page, the comma after "knowingly" should be eliminated. Attention is also called to the fact that the term "interstate carrier" used in line 24 on the same page is not defined in the bill, and it is not clear what carriers are included in the term. It would be better to definite this term or use terms which are defined. 9. At the top of page 53, the bill begins to deal with common carriers in foreign commerce, and agreements of such carriers is the first subject treated. The heading at the top of sheet 53 would be more helpful if changed to read as follows: "COMMON CARRIERS IN FOREIGN COMMERCE" 10. In section 224 (a) on page 55, common carriers by water in foreign commerce are forbidden to charge any rate or fare which is "unjustly discriminatory between shippers or ports * * * "1 Under the Interstate Commerce Act, a distinction is drawn between unjust discrimination, which is covered by section 2, and undue prejudice or preference under section 3. General speaking, an unjust discrimination is recognized only where the same points of origin and destination are involved, and where there are different points of origin or destination the case must be brought under section 3. Section 224 (a) apparently contemplates that unjust discrimination may exist as between different ports, which would be at variance with the usage under the Interstate Commerce Act, and this might result in some confusion. We hesitate to suggest a change in section 224 (a), because it is understood that section is derived from the Shipping Act, but it would be better to use terms in the same way they are used in the Interstate Commerce Act. 11. Section 225 (a) on page 57 authorizes the Commission to award reparation for violations of the act by common carriers in foreign commerce upon complaint and after investigation in such manner as it deems proper. However, section 208 (a) commencing on page 23 authorizes the Commission to award reparation upon complaints against interstate common or contract carriers or wharfingers only after hearing. No reason is apparent for requiring a hearing in one instance and not in the other. 12. Section 225 (a) on page 57 provides that reparation may be awarded against a common carrier in foreign commerce, "if the complaint is filed within 1 year after the cause of action accrued." However, under section 208 (c) (2) on page 25, complaints against interstate carriers or wharfingers for reparation not based on overcharges must be filed within 90 days after the cause of action accrued. It may be that this difference in the periods of limitation is warranted, but we are not in a position to express an opinion on that at this time. 13. In lines 8, 9, and 12 on page 62, lines 19, 20 on page 65, and line 9 on page 66, references are made to section 223 "and the following' This is somewhat confusing, and it is suggested that such references be changed to "sections 223 to 231, inclusive", if that is what is intended. 14. This bill contains no provisions similar to section 17 of the Interstate Commerce Act, which authorizes the Commission to divide itself into divisions, also to delegate authority to individual commissioners or boards of employees, and contains various other provisions regarding the conduct of its business. The Coordinator's first bill contained a provision at the end of section 204 (a), as follows: "All the provisions of section 17 of part I shall apply to proceedings under this part." The omission of a similar provision in the present bill is an important matter, which should be corrected by inserting the above-quoted provision at the end of section 204 (a) on page 8. With the foregoing suggestions, we recommend approval of this bill, and in closing we desire to repeat a portion of what the Commission said in transmitting the Coordinator's last report: 'As the result of further study, the Coordinator has now modified in certain details the motor-carrier and water-carrier bills submitted in his second_report; essentially, however, they are the same that were considered last year. He now recommends their adoption as modified. In this recommendation we concur, and we urge speedy adoption. The bills for the regulation of water and motor carriers we regard as vital. Upon their early enactment depends the preservation and development of a healthy, adequate, coordinated system of transport for the Nation. We can have such a transport system only by unified regulation of these important, competing agencies; and the public needs and welfare must be the activating principle in such unified regulation, so that all forms of agencies for carriage may prosper within their appropriate fields, and the national transportation requirements may be met." Respectfully submitted. FRANK MCMANAMY, Chairman of Legislative Committee. Mr. Chairman, that concludes the statement which I have been directed to make in behalf of the Interstate Commerce Commission with respect to this bill. Mr. CROSBY. Are there any questions? At present the car ferries are largely owned by the railroads. Under what authority are they operated, as to regulations? Mr. McMANAMY. Car ferries? Mr. CROSBY. Yes. I am thinking principally of the Great Lakes. Mr. McMANAMY. The car ferries are considered extensions of the lines of the railroads, under the decisions of the Supreme Court, as extending the rails from one side of the stream or lake to the other side. Mr. BREWSTER. You, I suppose, are somewhat familiar with the conditions that have been associated with Government relations with water transportation in recent years? Mr. McMANAMY. Somewhat; yes, sir. Mr. BREWSTER. You do not hestitate to enter where the angels have somewhat failed, in successfully solving that water transportation problem? Mr. McMANAMY. Well, perhaps I am one of the class who rush in where angels fear to tread. But, nevertheless, in the interest of the public-we do not wish that this should be given to the Interstate Commerce Commission; but we do feel that it should not be controlled by two commissions. Mr. BREWSTER. Would you recognize a distinction between domestic and foreign commerce? Mr. McMANAMY. Why, I think I should. But, in this bill, the question of the regulation of foreign commerce consists, as the Coordinator explained, of a transfer of the authority now exercised by the Shipping Board Bureau of the Department of Commerce; and I do not understand that it is new legislation. Mr. BREWSTER. Well, would you recognize that the problem was essentially different, internally and externally? Mr. McMANAMY. I think that would have to be recognized. Mr. BREWSTER. And that, when we engage in foreign commerce, in competition with all the other nations on the earth now, that we have got, possibly, to have a different system of administration and control than we have for domestic transportation? Mr. McMANAMY. That is probably true. Mr. BREWSTER. That is, a regulatory body, such as you have been, may not be as well designed to enter this highly competitive foreign field? Mr. McMANAMY. Well, we have experienced a little of that in the regulations for the safe transportation of explosives by water, which we now have jurisdiction over under the law; and I will confess that there are some difficulties which must be worked out in the administration of the law. Nothing as big as this can be worked out without experiencing some difficulties; and, probably, nothing of this size could be successfully worked out without further legislation, as experience shows the need for it. We have handled matters of that kind in that way, and I know of no other way. There may be another and a better way. Mr. BREWSTER. Have you seen Mr. Farley's report to the President on the foreign shipping contracts? Mr. McMANAMY. I do not think I have, sir. Mr. CROSBY. Are there any further questions? Mr. CROSBY. Now, we will take up the subsidy hearing. Mr. Campbell is the first witness called. Mr. BREWSTER. I think, Mr. Chairman, it was suggested that he was to go on at 2:30. Mr. LEHLBACH. I believe the suggestion was that when Mr. Eastman and Mr. McManamy, of the Interstate Commerce Commission, finished, we would then rise; that, instead of fixing an hour for rising, we would take this as a completion of testimony for the morning. Mr. BREWSTER. And then recess until 2:30. Mr. CROSBY. If that is the pleasure of the committee, we will stand adjourned until 2:30 o'clock, at which time the committee will further consider the ship subsidy bill. (Whereupon the committee adjourned the hearing on this bill until Wednesday, May 8, 1935, at 10:30 a. m.) THE WATER CARRIER ACT, 1935 WEDNESDAY, MAY 8, 1935 HOUSE OF REPRESENTATIVES, COMMITTEE ON THE MERCHANT MARINE AND FISHERIES, Washington, D. C. The committee, at 10:45 a. m., proceeded to the consideration of H. R. 5379, Hon. Schuyler O. Bland (chairman), presiding. STATEMENT OF MAJ. GEN. THOMAS QUINN ASHBURN, PRESIDENT OF THE INLAND WATERWAYS CORPORATION General ASHBURN. Mr. Chairman, my name is Thomas Quinn Ashburn; I am a major general, United States Army. I am chairman of the board and president of the Inland Waterways Corporation. This Inland Waterways Corporation, as you know, is a governmental institution, all the stock of which is owned by the people of the United States, and is the pioneering and demonstrative agency to bring about a rehabilitation of water transportation upon our interior streams. As president of the Inland Waterways Corporation, the congressional agency charged with the development of transportation on our inland waterways, with making effective the policy of Congress enunciated in section 500, Transportation Act, and section 201 (a) of the same act, it is my duty to lay before this honorable committee my views, based upon 15 years' study of this question, as to the advisability of the passage of H. R. 5379. At the time of the declaration of policy in section 500 of the Transportation Act, there existed a practical monopoly of transportation by the railroads. They had most successfully destroyed water transportation upon our interior streams; neither motor, air, nor pipe-line transportation was particularly threatening, and the only reason that inland water transportation had come back in the picture, was the fact that, during the war, certain streams and canals had been declared navigable, certain facilities created upon them, and certain governmentally owned water lines were operating upon them, under the control of the war-time Railroad Administration. Section 500 of the Transportation Act, 1920, reads as follows: It is hereby declared to be the policy of Congress to promote, encourage, and develop water transportation, service, and facilities in connection with the commerce of the United States, and to foster and preserve in full vigor both rail and water transportation. I shall not take up your time by rehashing all the original struggle to make this policy effective. Suffice it to say that at that time most rail men laughed at the policy, because of their thought that it was |