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It is not good onough when it lays out now freoways to serve now cities and suburbs and carelessly scars the irreplaceable countryside.

It is not good enough when it adheres to custom for its own sake and ignores opportunities to serve our pooplo more economically and officiently.

It is not good enough if it responds to the needs of an earlier America and does not help us expand our trade and distribute the fruits of our land throughout the world.

Way WE HAVE FALLEN SHORT Our transportation system has not emerged from a single drawing board, on which the needs and capacities of our economy were all charted. It could not have done so, for it grew along with the country itself—now restlessly expanding, now consolidating, as opportunity grow bright or dim.

Thus investment and service innovations responded to special needs. Research and development were sporadic, sometimes inconsistent, and largely oriented toward the promotion of a particular means of transportation.

As a result, America today lacks a coordinated transportation system that permits travelers and goods to move conveniently and efficiently from one means of transportation to another, using the best characteristics of each,

Both people and goods are compelled to conform to the system as it is, despite the inconvenience and expense of —

aging and often obsolete transportation plant and equipment; networks chiefly designed to serve a rural society;

services long outstripped by our growing economy and population, by changes in land use, by new concepts in industrial plant location, warehousing, and distribution;

the failure to take full advantage of new technologies developed elsewhere in the economy; and

programs and policies which impede private initiative and dull incentives for innovation. The result is waste of human and economic resources and of the taxpayer's dollar.

We have abided this waste too long.
We must not permit it to continue.

We have too much at stake in the quality and economy of our transportation system. If the growth of our transport industries merely keeps pace with our current national economic growth, the demand for transportation will more than double in the next 20 years.

But even that is too conservative an estimate. Passenger transportation is growing much faster than our gross national productreflecting the desires of an affluent people with ever-increasing incomes.

PRIVATE AND PUBLIC RESPONSIBILITY The United States is the only major nation in the world that relies primarily upon privately owned and operated transportation.

That national policy has served us well. It must be continued.

But private ownership has been made feasible only by the use of publicly granted authority and the investment of public resources,

by the construction of locks, dams, and channels on our rivers and inland waterways;

by the development of a vast highway network;
by the construction and operation of airports and airways;
by the development of ports and harbors;
by direct financial support to the merchant marine;
by grants of eminent domain authority;

by capital equipment grants and demonstration projects for mass transit; and

in years past, by grants of public land to assist the railroads. Enlightened government has served as a full partner with private enterprise in meeting America's urgent need for mobility.

That partnership must now be strengthened with all the means that creative federalism can provide. The costs of a transportation paralysis in the years ahead are too severe. The rewards of an efficient system are too great. We cannot afford the luxury of drift- or proceed with "business as usual.”

We must secure for all our travelers and shippers the full advantages of modern science and technology:

We must acquire the reliable information we need for intelligent decisions.

We must clear away the institutional and political barriers which impede adaptation and change.

We must promote the efforts of private industry to give the American consumer more and better service for his transportation dollar.

We must coordinate the executive functions of our transportation agencies in a single coherent instrument of government. Thus policy guidance and support for each means of transportation will stregthen the national economy as a whole.

A DEPARTMENT OF TRANSPORTATION I urge the Congress to establish a Cabinet-level Department of Transportation.

I recommend that this Department bring together almost 100,000 employees and almost $6 billion of Federal funds now devoted to transportation.

I urge the creation of such a Department to serve the growing demands of this great Nation, to satisfy the needs of our expanding industry and to fulfill the right of our taxpayers to maximum efficiency and frugality in Government operations.

In so doing, I follow the recommendations of many outstanding Americans.

In 1936, a select committee of the U.S. Senate recommended a Department of Transportation, or, in the alternative, the consolidation of all transportation programs in the Department of Commerce.

In 1949, the Hoover Commission Task Force on Transportation recommended a Department of Transportation.

In 1961 President Eisenhower recommended such a Department in his budget message.

In 1961 a special study group of the Senate Committee on Commerce recommended that all promotional and safety programs of the Federal Government be concentrated in a Department of Transportation.

Many distinguished Members of Congress have offered bills to create the Department. Private citizens, the Nation's leading experts in the field, have made the same recommendation to me.

It is time to act on these recommendations.

SCOPE OF THE DEPARTMENT I propose that the following agencies and functions be consolidated in the Department of Transportation:

1. The Office of the Under Secretary of Commerce for Transportation, and its policy, program, emergency transportation and research staffs.

2. The Bureau of Public Roads and the Federal-aid highway program it administers.

3. The Federal Aviation Agency, with its functions in aviation safety, promotion, and investment, will be transferred in its entirety to the now Department. It will continue to carry out these functions in the new Department.

4. The Coast Guard, whose principal peacetime activities relate to transportation and marine safety. The Coast Guard will be transferred as a unit from the Treasury Department. As in the past, the Coast Guard will operate as part of the Navy in time of war."

5. The Maritime Administration, with its construction and operating subsidy programs.

6. The safety functions of the Civil Aeronautics Board, the responsibility for investigating and determining the probable cause of aircraft accidents and its appellate functions related to safety.

7. The safety functions and car service functions of the Interstate Commerce Commission, principally the inspection and enforcement of safety regulations for railroads, motor carriers, and pipelines, and the distribution of rail car supply in times of shortage.

8. The Great Lakes Pilotage Administration, the St. Lawrence Seaway Development Corporation, the Alaska Railroad, and certain minor transportation-related activities of other agencies.

As this list indicates, I am recommending the consolidation into the Department of those Federal agencies whose primary functions are transportation promotion and safety.

NATIONAL TRANSPORTATION SAFETY BOARD No function of the new Department, no responsibility of its Secretary-will be more important than safety. We must insure the safety of our citizens as they travel on our land, in our skies, and over our waters.

I recommend that there be created under the Secretary of Transportation a National Transportation Safety Board independent of the operating units of the Department.

The sole function of this Board will be the safety of our travelers. It will review in vestigations of accidents to seek their causes. It will determine compliance with safety standards. It will examine the adequacy of the safety standards themselves. It will assume safety functions transferred from the ICC and the CAB.

I consider the functions of this Board so important that I am requesting authority from the Congress to name five Presidential appointees as its members.

RELATION TO OTHER GOVERNMENT ACTIVITIES The activities of soveral departments and agencies affect transportation promotion and safety. Sound management requires that an appropriate and intimate relationship be established between those activities and the new Department of Transportation.

1. The subsidy functions of the Civil Aeronautics Board.- Aviation subsidies- now provided only for local airline servico-clearly promoto our domestic transportation system. But subsidy awards are an integral part of the process of authorizing air carrier service. This is a regulatory function..

Therefore the airline subsidy program should remain in the Civil Aeronautics Board. The Secretary of Transportation, however, will develop principles and criteria which the Board will take into consideration in its proceedings. In this way the subsidy program will be coordinated with overall national transportation policy.

2. The navigation program of the Corps of Engineers.—The Corps of Engineers—through its construction of locks and harbor facilities and its channel deepening and riverbank protection work-makes a major contribution to water transportation. The Department of Transportation should not assume the responsibility for that construction, but its Secretary should be involved in the planning of water transportation projects.

With the approval of the President, the Secretary of Transportation should also issue standards and criteria for the economic evaluation of Federal transportation investments generally. In the case of transportation features of multipurpose water projects, he should do so after consulting with the Water Resources Council.

3. International aviation.—The Secretary of Transportation should provide leadership within the executive branch in formulating longrange policy for international aviation. While foreign policy aspects of international aviation are the responsibility of the Secretary of State, the Secretary of Transportation should insure that our international aviation policies are consistent with overall nationaltransportation policy:

Subject to policy determinations by the President, the Civil Aeronautics Board regulatos international aviation routes and fares as they affect the United States. This function has far-reaching effects on our foreign policy, our balance of payments, and the vitality of American aviation. The Secretary of Transportation should participate in Civil Aeronautics Board proceedings that involve international aviation policy.

4. Urban transportation.—The Departments of Transportation and Housing and Urban Development must cooperate in decisions affecting urban transportation.

The future of urban transportation—the safety, convenience, and indeed the livelihood of its users—depends upon wide-scale, rational planning. If the Federal Government is to contribute to that planning, it must speak with a coherent voice.

The Department of Housing and Urban Development bears the principal responsibility for a unified Federal approach to urban problems. Yet it cannot perform this task without the counsel, support, and cooperation of the Department of Transportation.

I shall ask the two Secretaries to recommend to me, within a year after the creation of the new Department, the means and procedures

by which this cooperation can best be achieved—not only in principle, but in practical effect.

ROLE OF THE DEPARTMENT The Department of Transportation will—

coordinate the principal existing programs that promote transportation in America;

bring new technology to & total transportation system, by promoting research and development in cooperation with privato industry;

improve safety in every means of transportation;

encourage private enterprise to take full and prompt advantage of new technological opportunities;

encourage high-quality, low-cost service to the public;

conduct systems analyses and planning, to strengthen the weakest parts of today's system; and

develop investment criteria and standards, and analytical techniques to assist all levels of government and industry in their transportation investments.

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THE INTERSTATE COMMERCE. COMMISSION The Cabinet-level Department I recommend will not alter the economic regulatory functions of the Interstate Commerce Commission, the Civil Aeronautics Board, or the Federal Maritime Commission.

I do recommend, however, a change in the manner of selecting the Chairman of the Interstate Commerce Commission.

Today, the Chairman of this vital Commission-alone among the Federal regulatory agencies—is selected, not by the President, but by annual rotation among the 11 Commissioners.

This is not sound management practice in an agency whose influence on our rail, highway, waterway, and pipeline industries is so far reaching.

The ICC bears the demanding and challenging responsibility to koop Federal regulation attuned to the noods and opportunities of a dynamic industry. Its jurisdiction extends to 18,000 transport companies. It handles 7,000 cases each year. No privato corporation of such size and importance would change its chief executive officer onco each year.

I sha'l shortly submit to the Congress a reorganization plan to give the President authority to designate the Chairman of the Interstate Commerce Commission from among its members, and to strengthen his executive functions.

SAFETY

105,000 Americans died in accidents last year.

More than half were killed in transportation, or in recreation accidents related to transportation.

49,000.deaths involved motor vehicles.
1,300 involved aircraft.
1,500 involved ships and boats.
2,300 involved railroads.

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