work, for example, we have the assistance of about 2,000-a little more than 2,000-local administrators appointed by the mayors of each city of over 10,000, and by the Governors.

At the important railroad centers, we have transportation advisory committees made up of representatives of the leading shippers. And in connection with our truck activities, we work in very close cooperation with the county farm transportation committees of the United States Department of Agriculture. They do a great deal of work for us. We have the help of the Interstate Commerce Commission field force and of various carrier organizations.

Someone on my staff made a computation the other day which indicated that, including all of these people who are giving us voluntary help, the total would add up to as many as 90,000. Of course, they are not doing full-time work, by any means, but they are giving us a great deal of help.

WORK OF DIVISION OF MOTOR TRANSPORT

Except for one of our departments, our figures are on a pretty modest basis. That one department is the Division of Motor Transport, which accounts for nearly $10,000,000 out of a total budget of nearly $15,000,000.

The lowest expenditure under the proposed 1944 Budget would be on the Great Lakes work, which is $24,050; coastwise and intercoastal, $29,340; inland waterways, $39,810; and so on. The railway work, for example, would account for $1,218,530; traffic movement, $707,120; local transport, $625,080.

They are all comparatively modest figures with the exception of the Division of Motor Transport, and I might say a word as to why that is large.

There you are dealing, not with a comparatively small number of well-organized companies, as in the case of the railroads, but you are dealing with 4,600,000 trucks, to say nothing of busses and taxicabs, which are owned by over 3,000,000 individual owners. great bulk of them have only one truck. Dealing with that situation is, of course, a far different thing from dealing with the well-organized railroads.

The

Out of those 4,600,000 trucks, only 600,000 are owned by for-hire operators. The others are privately owned; by farmers, by local people, by industries, and so on.

Of course, also, the rubber shortage, the loss of our rubber supply, created a tremendous need for the conservation of that form of transportation, upon which the country is now absolutely dependent. It has not only taken the place of the old horse and wagon, but greatly magnified the work done by that form of transportation. Farms could not be operated; our local businesses could not be operated; we could not get along at all without the trucks. There is a vital need for conserving and preserving them until we can get our rubber supply on a proper basis.

And now we have not only the shortage of rubber, but we have shortages in manpower which are even more serious in many parts of the country than the shortage of rubber.

We have shortages in repair parts. We have shortages in the vehicles themselves, which are not being manufactured, and in some places we have shortages in gasoline.

So that the work of conserving and preserving that form of transportation is of tremendous importance and involves very great difficulties.

It became necessary for us to identify these over 3,000,000 owners and establish direct contact with them on the ground. They cannot come to Washington.

And in connection with the rationing of gasoline, we were given the duty of determining how much gasoline each operator should have. That all necessitated General Order 21, which has been our major headache; and it has resulted in the creation of a field force of something like 2,800 men, which amounts to about 60 per State, including clerks and everything else. That, really, is not a very large figure when you consider the number of vehicles and owners with which we have to deal.

ORDER NO. 21 IN RELATION TO OPERATION BY TRUCK, BUS, AND TAXICAB OPERATORS The CHAIRMAN. What is this order No. 21?

Mr. EASTMAN. That is the order which provided for certificates of war necessity for truck and bus and taxicab operators. Under those certificates of war necessity, the amount of mileage which they can operate and the amount of gasoline which they can use are specified.

That situation I think is now fairly well in hand, and I think we have an excellent field force on the whole throughout the country, dealing with that matter. That order was the main reason for establishing that field force, as we saw it, and the main reason for the comparatively large expenditure for our motor transport work.

EXTENSION OF AUTHORITY OF OFFICE OF DEFENSE TRANSPORTATION OVER TERRITORIES AND POSSESSIONS

During the year, I might say we have increases in our duties, some of which are of considerable importance. For instance, the President, by order, extended the responsibility of the Office of Defense Transportation over the Territories and possessions of the United States. That was done on August 5, 1942.

There was a very serious situation in Puerto Rico, and we now have a unit there covering all forms of transportation, which is pretty nearly autonomous. We are now exploring the possible need for extending our activities to Hawaii, Alaska, and the Virgin Islands.

PUBLIC LAW NO. 779 IN RELATION TO FEDERAL TRANSPORTATION NEEDS

Then the Congress passed Public Law No. 779; that act was passed December 1, 1942, and it enabled the Secretary of War, the Secretary of the Navy, and the Maritime Commission, to get into the transportation business in order to provide transportation facilities at the new plants which are being operated all over the country to supply their needs. It carried at the end a provision that—

the authority herein granted to these various Departments shall be exercised in each case only after a determination by the Office of Defense Transportation that existing private and other facilities are not and cannot be rendered adequate by other means, that its exercise will result in the most efficient method of

supplying transportation to the personnel concerned, and the utilization of transportation facilities consistent with the plans, policies, and programs of the Office of Defense Transportation.

That was supplemented by an Executive order of the President, dated January 4, 1943, which gave the Office of Defense Transportation very comprehensive duties in this connection. It is our duty, for example, to advise and assist Federal departments and agencies, State and local governments, and private organizations in surveying the need for and planning the provision of transportation service for the movement of personnel to and from war plants, and so on.

We must review and approve such contracts, agreements, or arrangements, wherever made by Federal departments and agencies for and in connection with such transportation.

We must advise the War Production Board on the allocation of new local transportation equipment. All the new busses which are being built we have to allocate to different parts of the country and different places. And we are given the power of requisitioning in that connection. All this has added very materially to our duties.

Then in December we were made a claimant agency before the War Production Board for all forms of domestic transportation, including private automobiles.

The CHAIRMAN. As of what date?

Mr. EASTMAN. That was in December 1942. We have to present to the War Production Board the needs of each one of these forms of transportation for new equipment and new facilities, including such things as repair parts and material. That is a very large responsibility and involves much complicated work, especially in connection with the controlled material plan of the War Production Board, which is, in itself, a very complicated matter.

DUTIES OF DIVISION OF STORAGE

In the matter of storage, we have now become the adviser of all the Government departments which are using storage. They come to us when they want storage, and we see that they get it.

Recently, the Lend-Lease Administration has delegated to my office the duty of procuring new facilities, where new facilities are needed, for storage. We can enter into lease arrangements under that authority. I think we can even build new facilities, although I am not quite certain about that. So far it has been a leasing matter. They have provided us with $1,000,000 which we can use for that purpose. But the responsibility of entering into those leases and supervising them now rests upon my Division of Storage.

In connection with the personnel work of the office, it was until recently handled through the Central Administrative Services of the Office for Emergency Management. Now that duty has been transferred to us.

We also had some additional work in connection with abandoned branch lines of railroads; proposals to abandon branch lines, in connection with the War Production Board. That is in abeyance for the time being.

TRANSPORTATION SERVICE OUTLOOK

Before talking about the probable and necessary work for the coming year, as we see it, I think I ought to say a word about the outlook for transportation service in general throughout the year. As I say, we have managed to get by. The railroads and the other carriers have really done a very extraordinary piece of work, as I see it.

I have given these figures often, but you may not have heard them. In 1941 the revenue ton-miles carried by the railroads reached an all-time peak by a comparatively small margin. In 1942 the revenue ton-miles increased nearly 35 percent over that all-time peak of 1941. And for the first 2 months of this year preliminary figures indicate that they were increasing above 1942 at the rate of 30 percent. I do not think that will be continued, because those 2 months did not include the tremendous increase in petroleum traffic to the East, which began last year. But I do think that there will be an increase of probably as much as 10 percent in 1943; a 10-percent increase in revenue tonmiles as compared with 1942. That is freight.

Now, when it comes to the passenger movement, I am certain that there will be a very large increase, because we know what the troop movements are going to be in connection with the greatly increased Army. They have been increasing right along. Troop movements are now accounting for over half of the Pullman cars of the country, absorbing their services; and there is every reason to believe that throughout the summer they will increase in considerable volume. The larger the Army grows, the more soldiers and sailors you have traveling on furlough and leave. You have seen them in the trains, I am sure. And you have more people visiting their camps-relatives and friends, and so on.

At the same time, the business of the country is increasing. The necessity for traveling on business is increasing. And moreover the workers of the country have more money in their pockets than heretofore, and have the urge to travel when they have a little time on their hands. And coupled with that, finally, is the fact that the private automobile is practically off the road for long-distance travel. So that all of that form of travel falls on the railroads and on the busses. In addition to the increased load, you must bear in mind that the pattern of traffic under war conditions has changed very materially. A tremendous amount of traffic is going to and from the Pacific coast, which was not organized for that purpose. The ports were not built to handle that traffic. The railroads were not built to accommodate it, either. And the construction of new war plants. in great volume and of great size throughout the country has changed the pattern of traffic in many other ways.

It has been wholly changed, of course, so far as the movement of petroleum to the eastern seaboard is concerned.

Now, in connection with the traffic overseas, there is every prospect that there will be concentrations at ports on the Pacific coast, and on the Atlantic coast, from time to time, which will create abnormal movements and special difficulties in handling. All this has to be faced by the railroads and the carriers of other types, with very little increase in new equipment.

LACK OF NEW RAILROAD EQUIPMENT

I made a comparison the other day with the last war. In 1917, 1918, and 1919, the railroads received about 7,900 new locomotives. In 1940, 1941, and 1942, they received about 2,200, although they have a much greater load now than they had then. That is something less than one-third, and a little more than one-fourth. Of course, the locomotives are of larger tractive capacity, but still there is a large difference, and the same is true of freight cars. And when it comes to the other types of transportation, practically no trucks have been built, very few barges, and only a small number of busses and a handful of streetcars.

So that we have the prospect of taking on these additional loads without much help in the way of new equipment. We are working very hard with the W. P. B. to get more, and I think they will help us to some considerable extent, but the demand for critical materials for the tremendous military needs is so great that there is every tendency to hold down what is given for transportation, and to ask that what we have be stretched and strained to do the work.

EFFECT OF MANPOWER SHORTAGE UPON RAILROADS

In addition to that, there are two other factors of great importance. One is the manpower shortage, which is beginning to affect the trucks and the busses very seriously, and it is also affecting the railroads. I was told the other day that the Pennsylvania Railroad, for example, has sent over 30,000 men into the military forces. Other railroads have done proportionately, and that means that to the extent those men have gone they have green workers to take their place, and those new employees often do not function as well as the older men.

Out on the Pacific coast, the Southern Pacific had a tremendous shortage in their maintenance-of-way forces-to such an extent that we are trying now to get a supply of labor from Mexico. It has created a dangerous situation on their line. Because of that general manpower situation, we already begin to see signs of some slowing up in the functioning of these carriers, and that slowing up is equivalent to a loss of so much equipment. That is a danger that is facing us.

Furthermore, they have been driving this equipment-and this is true of all carriers-to the very limit. The railroads went through this winter with practically no reserves of locomotive power; and it was one of the worst winters we have had. That meant a great strain on equipment.

The motor carriers are running a lot of trucks now that ordinarily would have been scrapped long ago, trying to make them keep on going. That, of course, creates an abnormal demand for repair parts. But the strain on the equipment has been such that there is no foretelling as to whether or not a situation will develop like the one-horse shay, when things will begin going bad all of a sudden. Those are the outlooks that we face for transportation.

CURTAILMENT OF UNNECESSARY CIVILIAN TRAFFIC ON THE RAILROADS

Mr. WOODRUM. Would it bother you if I interrupted to ask a question?

Mr. EASTMAN. No, sir.