portation and service as the development of the business and the demands of the public shall require. The Board can, however, and in my opinion should, exercise initiative to encourage and develop air transportation. It is in this connection that the Board has encouraged the various promotional fares which have been designed to attract an increasingly greater number of travelers to air transportation.

Question 5. Are you satisfied with the progress made thus far in developing the potential of the air cargo industry?

Answer. I am not satisfied with the progress made to date in developing the potential of the air cargo industry. Although the certificated route carriers are carrying an increasing amount of cargo today over that carried 5 years ago, it has been the all-cargo carriers who have made tremendous efforts in the experimentation and development of the air cargo business. Unfortunately, these carriers have been hampered by the lack of an adequate all-cargo aircraft. Now that these aircraft are available, it is hoped that the all-cargo industry will develop to the increasing potential which, in my opinion, it has. The carriage of air freight is becoming increasingly desirable to manufacturers and shippers, and it has developed to the point that all types of air services last year carried 97.6 percent more cargo than was carried in 1955. In my opinion, this indicates that the cargo is available and that continuing experimentation and development will some day realize the transportation of the great amount of available air cargo.

Question 6. Recently I have received many letters from travel agents who claim, often in vague and general terms, that certain Board policies are unfair to travel agents. Do you have any comment?

Answer. From time to time, the Board does receive letters from travel agents. These have generally involved such matters as the standards under which new agents are appointed, problems involving travel agents participating in charter flights, reduced rate transportation for travel agents, and other similar problems. The Board's normal practice is to permit travel agents to have their views considered before any regulatory action is taken by the Board which may have an effect upon them. Thus, many of the comments from travel agents are filed under procedures where the Board offers the opportunity to comment. The Board does attempt to consider the effect upon all segments of the air transportation industry in determining the public interest aspects of any regulatory action that is taken. I can well understand that in those instances where the Board's action may not conform to the views of certain of the agents, they naturally would be opposed to the decisions. Nevertheless, I believe that the Board's decisions are reached in accordance with procedures which are fair to all the parties involved-many of whom may have opposing interests—as well as on the basis of the evidence before the Board dealing with the particular matters to be decided.

Question 7. Certain airline executives have within the past year made statements claiming that excessive duplication of routes is the primary reason for the industry's poor earnings results. Do you agree with this conclusion? If not, what in your view are the reasons for the industry's current financial condition?

Answer. I cannot agree with the various statements that have been made to the effect that the industry's poor earnings record is the result of excessive route awards by the Board. There may well be isolated segments of our air transportation system where competition may appear to be excessive. However, on the whole, it is my opinion that the route awards of the Board over a period of years have resulted in a balanced air transport system with sufficient competition to stimulate the development of air traffic. In my opinion, much of the industry's difficulty during the past several years has been due to the introduction of modern jet aircraft. The cost of these aircraft has been very substantial. In addition, it has been necessary for the airlines to undergo major training programs which have been costly. These factors, coupled with several bad accidents, have unquestionably had an impact upon airline revenues.

SUNDRY NOMINATIONS

WEDNESDAY, MARCH 14, 1962

U.S. SENATE,

COMMITTEE ON COMMERCE,
Washington, D.O.

The committee was called to order, pursuant to notice, at 10:12 a.m., in room 5110, New Senate Office Building, Hon. Warren G. Magnuson, chairman of the committee, presiding.

NOMINATION OF DONALD W. ALEXANDER, OF FLORIDA, TO BE MARITIME ADMINISTRATOR

The CHAIRMAN. Mr. Alexander.

Donald W. Alexander, of Florida, to be Maritime Administrator. Mr. Alexander, who is serving under an interim appointment, reports to the Secretary of Commerce through the Under Secretary for Transportation.

While we have had a Maritime Administrator in the Department for some time, the present position is a so-called new position created by the maritime reorganization plan made by the President and OK'd by the Congress last session.

I do not say the other one was not important, but your duties and responsibilities are greater in this new position.

Mr. Alexander has charge of all promotional and development functions under the merchant marine laws, including the award of ship construction and operating subsidy contracts. This is the big responsibility, and this is the part that Congress is deeply interested

in.

We have letters from Senator Holland and Senator Smathers urging approval of the nomination and a biographical sketch of Mr. Alexander, which we will put in the record. (The material follows:)

U.S. SENATE,

COMMITTEE ON AGRICULTURE AND FORESTRY,
February 7, 1962.

Hon. WARREN G. MAGNUSON,
Chairman, Committee on Commerce,
U.S. Senate, Washington, D.C.

Dear Mr. CHAIRMAN: This letter will signify the fact that I am supporting the nomination of Mr. Donald W. Alexander, of Palm Beach, Fla., and Washington, D.C., to serve as Maritime Administrator of the Department of Commerce. In view of Mr. Alexander's long and successful experience in business and his honorable service in the U.S. Navy, including his attendance and graduation at the U.S. Naval Academy, I feel that Mr. Alexander is well qualified by training and experience to fill the important post for which he has been nominated. In addition, I am advised that his personal character and reputation are of the highest rank.

I therefore join in supporting the confirmation by your committee and the Senate of the nomination of Mr. Alexander to be Maritime Administrator. With much respect, I beg to remain,

DEAR MR. CHAIRMAN: With respect to the nomination of Donald W. Alexander to be Maritime Administrator, and in reply to your letter of January 17, I wish to state that while I do not know Mr. Alexander very well, personally, although I have met him, as he is a recent resident of Florida, all that I hear about him is excellent.

I have met a number of people who do know him, and I have yet to find anyone who is a knowledgeable person, not just in maritime matters but in other areas as well, who does not speak most highly of his capabilties, his character, and his integrity.

Frankly, I think he should be supported very strongly by our committee.
Sincerely yours,

GEORGE A. SMATHERS.

BIOGRAPHICAL SKETCH OF DONALD W. ALEXANDER

(Designated by President Kennedy To Be Maritime Administrator of the

Department of Commerce)

Donald William Alexander is 57 year of age and is currently serving on an interim basis as Maritime Administrator for the U.S. Department of Commerce, which post he has held since October 9, 1961.

Prior to his appointment as Maritime Administrator, Mr. Alexander was a management consultant, residing in Palm Beach, Fla. In this capacity, he served as a member of a Commerce Department trade mission to Ceylon, Malaya, and Singapore, and has been a member of top-management industrial seminar teams sent by the International Cooperation Administration to Ecuador, Honduras, Nicaragua, and Brazil.

From 1951 to 1960 he was vice president in charge of operations for the Whirlpool Corp., manufacturers of home appliances, including refrigerators, ranges, washing machines, dryers, freezers, ice cube makers, ironers, and air conditioners.

From 1946 to 1951 Mr. Alexander was vice president in charge of manufacturing for P. R. Mallory & Co. of Indianapolis, Ind., manufacturers of electronic and advanced metallurgical components.

During World War II he saw service in the Naval Reserve in the preflight program and as engineer officer aboard the U.S.S. Hornet from 1942 to 1945 and was awarded the Legion of Merit Medal. He retired from the U.S. Naval Reserve in 1954 with the rank of captain.

Prior to World War II, from 1928 to 1942, he was with Stewart-Warner Corp., manufacturers of home appliances and automotive accessories. He resigned as general manager of the Indianapolis plant to serve in the Navy.

Mr. Alexander was born in Des Plaines, Ill., on September 30, 1904. He attended Maine Township High School, Des Plaines, Ill., U.S. Hall School, Columbia, Mo., and graduated from the U.S. Naval Academy in 1926. In 1928-29, he attended Walton School of Commerce in Chicago, Ill.

Mr. Alexander is a member of the American Management Association and the U.S. Power Squadron.

He is married to the former Helen Hoover of Pittsburgh, Pa., and has two children. He resides at present at 4000 Cathedral Avenue NW., Washington, D.C., apartment 219-B.

The CHAIRMAN. We have asked Mr. Alexander many, many questions on maritime matters in the course of the nominations for the Maritime Commission, which under the Reorganization Act was separated from the promotional functions that they formerly held, which you now hold and are responsible to the Secretary of Commerce for. The chairman has no particular questions he wants to ask Mr. Alexander. But in the hearing last week we got into the question of ship construction, the construction on the Bethlehem Steel contracts which were denied by the Department of Commerce.

I mentioned that in Appropriations Committee, in Commerce, on the construction subsidies that our plan was about, I said, 30 to 32 ships a year to keep on schedule, and it was brought out that we were only going to lay keels for 15, was it?

STATEMENT OF DONALD W. ALEXANDER, OF FLORIDA, NOMINEE TO THE POSITION OF MARITIME ADMINISTRATOR

Mr. ALEXANDER. Eighteen, sir.

The CHAIRMAN. Eighteen? I think the record ought to be clarified on that point, because there is a large discrepancy.

Mr. Alexander has in the meantime got some charts on the planned ship construction program for the next few years, the number of ships, the obsolescent features, and so forth. I think the committee would be interested in hearing just briefly from him on those plans. Mr. ALEXANDER. Yes, sir.

Before showing the charts, sir, I would like to say that we have contractual obligations with the subsidized lines covering these ship replacements. There are about 300 ships in the subsidized fleet, and our obligations extend directly to those ships. The charts are intended to cover those 300 ships and their replacement.

The CHAIRMAN. Fine.

Mr. ALEXANDER. This chart here shows the program as it was in May of 1960, about 2 years ago.

As the chairman said, at that time there was a level of construction between the years 1962 and 1965 of between 30 and 35 ships per year. This is the 30-ship line, and this is the 35-ship line [indicating on chart].

However, that program contemplated a rapid falling off of construction until by the year 1971 the entire replacement program would have been completed, and there would have been a gap in this program between the years 1971 and 1980, at which time the second flight of replacement ships would have been started in construction.

The CHAIRMAN. I think, Mr. Alexander, we ought to point out for the record that the reason that we have these ship dropoffs in all your charts is that we run into what we call a block obsolescence of the fleet.

Mr. ALEXANDER. Yes, sir.