The union supports the proposed manning schedules to be introduced by the Coast Guard by the proposed bills. In summary, we may conclude that the appalling high increase in accidents between 1951 and 1961 was caused by (1) Continued increase of the number of uninspected towing vessels. (2) Decline in the number of licensed operators and crew members. (3) Decline in trade union membership and the influence of the trade union as a positive factor in safety matters. It is difficult to understand the industry's position of opposition to legislation calling for licensing of personnel, regulation and inspection of vessels in the face of the indisputable facts established in this record. 1. Claims of good safety records by industry representatives appearing before this committee are no refutation of the overall bad safety record irrevocably established from 1951 to this date. 2. It is clear that Coast Guard regulation would not cause overmanning of vessels. To the contrary, Coast Guard regulation would simply reinforce existing good practices presently prescribed by union contracts, but observed more in the breach than in the practice because of the pressure of nonunion competition in the towing-vessel industry. And I might say similarly in the trucking industry, because of the "gypies." Until ICC ordered regulations affecting the "gypies," we faced a terrific problem on the highways, as we had on the rivers. The two experts accompanying me here today will make available to the committee many more examples of undermanning of towing vessels, such as has already been stated heretofore in this testimony. In the absence of Federal regulation the most reckless financial adventurer sets the standards which eventually prevail upon the whole industry. 3. Licensing of officers would not be harmful to the industry but to the contrary would attract literate, competent personnel. It is not true that such personnel is not available. Such personnel is available providing that competitive wage scales exist. Present conditions where pilots guide towboats without rudimentary knowledge of reading charts or making corrections on compasses would be eliminated. The competent personnel presently engaged would continue under Coast Guard licensing and only the inefficient who are unable to use navigational aids would be eliminated. 4. Coast Guard inspection would not impose seagoing standards on river traffic. Coast Guard inspectors navigate the rivers themselves in the course of their duties and are perfectly competent to establish standards in this area. 5. Regulation would not drive legitimate operators out of business. This contention has been repeated by waterway operators, but the fact is that only fringe operators who are in the business because of policies of exploiting labor and unsound equipment-in other words, the "gypsies" of the river traffic-would be eliminated. And I say to this, "Good riddance." The sound and legitimate operators are presently enjoying excellent profits based upon ICC and IRS figures. ICC figures demonstrate that on the Mississippi River and its tributaries class A and B carriers are "struggling for their existence" in this fashion: Operating ratio in 1958, was 86.37 percent; in 1963, it was 84.51 percent. In other words, their profits increased by about 2 percentprofit ratio increased. Net income in 1958, was $15.5 million and in 1963, $19.9 million. IRS figures come closer to giving a total picture of the profit situation in the whole industry. IRS figures for the water transportation industry firms with assets of less than $10 million are, in effect, the figures for the inland water industry. In 1962, out of 4,182 water transportation firms, only 62 had assets of over $10 million, and these were essentially the seagoing members of the industry. Here are figures for the water transportation industry companies with assets of less than $10 million, the inland waterways companies: These facts are confirmed by an article in the Journal of Commerce of March 29, 1965. That article stressed that the waterways industry is essentially a very financially robust industry and that the Mississippi and tributaries section of that industry were anticipating in 1965 having their most prosperous year in history. This is accounted for by the continued expansion of New Orleans as an overseas port and by the development of many industries along the banks of the Mississippi River. The IRS figures indicate that total receipts of the waterways industry have increased from 1958 to 1962 by about 21 percent. At the same time, net income (receipts less total cost) increased at a greater rate of about 47 percent. Dividends or distribution to stockholders other than in their own stock increased at a rate of at least 25 percent. Here, then, is an industry which is making high profits, yet is representing itself to this committee as being in such an impoverished condition that it must reluctantly oppose all attempts to impose safety regulations upon its manner of operation. We are opposed to the substitution of H.R. 7491 for the identical bills H.R. 156 and H.R. 723. We find H.R. 7491 is a totally inadequate measure and fear that its adoption by the committee might result in the impression that problems had been faced which had, in fact, been evaded. It is very similar to the congressional solution at the labeling of cigarettes at this session of Congress, which one of the licensers in the Senate told me last night was worse than no bill at all, because it prevents any effective action for many, many years to come. We would go so far as to say that H.R. 7491 is a stalking horse for interests that would be glad to see the river industry continue on its unregulated and hazardous course. The failings of H.R. 7491 are twofold: 1. It avoids any demands for inspection of the towing vessels themselves and this is absolutely essential. 2. It does not provide for licensing of all responsible crew members, but reserves its provisions for only those crew members concerned with navigation. Despite increasing complexity of enginerooms and equipment, no provision is made for the licensing of towboat engineers. The industry position, already made to this committee, is even weaker than H.R. 7491 on licensing provisions. Industry spokesmen have called for the issuance of licenses without any geographical limitations. Thus, a man can be issued a license in a Mississippi backwater and be authorized to dock the Queen Elizabeth in New York harbor. Our union calls for the licensing by the Coast Guard of all responsible crew members. We call for geographical limits on licenses so that men are only permitted to operate in areas they know and whose hazards they appreciate. Navigation of a towing vessel on a busy river leaves no time to consult charts or to study the latest reports. A man must know his territory and have attention to spare to take corrective action to guard against the errors of other river users. The union interest in the licensing question is sparked by its interest in protecting its members, present, and future. The union is also aware of the increasing technological nature of riverboat work and looks to licensing as a necessary measure to assure that technological advance goes hand in hand with adequate safety programs. CONCLUSION 1. I wish to call the committee's attention to the importance of assuming its responsibility in this all-important area where a void in safety regulation persists. It has ducked its responsibility for the past 25 years. The ever-mounting accidents and fatalities call for immediate action in this session of Congress. 2. Pleas of poverty should not blind the committee to the economic realities of the situation. A profitable financial picture exists for the legitimate operator and an evermore profitable picture could exist if the presently unregulated water-carrier industry were regulated and integrated into the present common carriage system under the supervision of the ICC. Safety regulation is the first step to bring order out of chaos. 3. And further, beyond any economic considerations, this legislation will serve the goals of protecting life and extending conditions under which human beings can find a degree of security and selfrespect. I would like to at this time also offer, if I may, for the record exhibits 1, 2, 3, 4, 5, and 6, and Mr. Bussey would like to comment on these briefly. Is that permissible, Mr. Chairman? Mr. GARMATZ. What are they? Statements? Mr. ZAGRI. These are exhibits dealing with the unsafe conditions that are presently persisting, which further substantiate the statements already made in my formal presentation. Mr. GARMATZ. May I ask you a few brief questions? Mr. BUSSEY. There is an exhibit on casualties and damages to U.S. locks and dams, which includes newspaper clippings and stories, factual statistics from the District Engineers and information. We think that the newspaper clippings are important, because they provide information which you do not have and they are the information which the public receives. Mr. ZAGRI. They also provide you with clues concerning some of the problem areas. Mr. BUSSEY. They do not, of course, indicate whether a vessel involved in an accident was inspected or whether a crew member responsible was licensed. This information is in the Coast Guard files and available to you if anything leads you to further inquiry. There is an exhibit here of navigational aids. During the course of this testimony here it has been repeatedly stated, these were of a character than an inexperienced man, or not a licensed man, could safety navigate the western rivers by the aid of these. We have prepared here in combination the three principal aids provided at public expense to aid navigation. These are the river maps, the river channel reports over a parallel section, and the river light lists. These are the three things which an uninformed pilot must consult in order to navigate in this fashion. We have newspaper clippings, pictures, and other information on the chlorine barge tragedy which has been repeatedly mentioned here. We have newspaper clippings and pictures, some of which you probably already have-the pictures at least--on the New Orleans causeway crash. These have been arranged in a progressive order from the date of the crash and indicates the people of the New Orleans area concerned with this problem and the action taken to correct it. We have another exhibit of miscellaneous clippings of casualties where a life was lost. An interesting thing in one of those is an editorial from a New Orleans publication, dedicated to the river interests, dated in April of 1956, indicating that the problem was of vital concern even that far back. Incidentally, Mr. Garmatz, you may be interested to know that in the articles on the New Orleans crash there is a clipping there, dated months before the crash, indicating your activity and the committee's activity on diesel legislation. And finally, there is another clipping of a Mobile Harbor gasoline fire which you may want to investigate further. These things are submitted for the committee's information. Mr. ZAGRI. We would like to have this incorporated, if we may, the record. into Mr. GARMATZ. The staff and committee will look them over and see what parts-there may be some duplication there, but I am sure they will be given a good examination and, if necessary, will be inserted in the record. Mr. ZAGRI. Where there is no duplication, may we have it in the record, sir? Mr. GARMATZ. Yes. 56-150-66--26 Mr. Zagri, on page 7 you said: The union interest in the licensing question is sparked by its interest in protecting its members, present and future. The union is also aware of the increasing technological nature of riverboat work and looks to licensing as a necessary measure to assure that technological advance goes hand-in-hand with adequate safety programs. Isn't that somewhat in favor of H.R. 7491-that last statement? Mr. ZAGRI. We feel 7491 does not go far enough, because it does not provide for licensing of all responsible crewmembers. It does not call for licensing of engineers and men who are required to deal with the complexities of enginerooms and other technological equipment. If your bill would cover all the personnel, then I feel it would be consistent with the needs and advancing technology in this industry. Mr. GARMATZ. On page 2, you say: Absence of regulation results in extremely hazardous operations: 99 percent of inland waterway towing vessels are not inspected, and it is estimated that 50 percent of the crews on the vessels are unlicensed. How do you arrive at those figures? Mr. ZAGRI. The diesel-powered vessels are not inspected because there are no regulations. That is the purpose of these hearings and the best estimates we have is that the steam-powered vessels constitute less than 1 percent of the vessels in this industry and 99 percent are diesel powered, and they are presently unregulated, and also uninspected. As fare as the 50 percent of the crews are unlicensed, this is the best estimate that we have, and perhaps my experts could fill you in on that. Mr. BUSSEY. The question was asked by Mrs. Sullivan in an earlier presentation if we could provide any information which would indicate the number of licensed people in the industry. Challenge had previously been made that the figures were misleading because we had no determination of the licensed and unlicensed. We went to the Coast Guard local office in St. Louis to try to obtain information of this kind. We find there that their records of licenses are filed alphabetically, and they cover all kinds of licenses to find out which were active, which was a river license, because these included also renewals from other areas. It would have meant going through all files, so we could do nothing there. We talked with the Coast Guard officer here and he said this could be obtained in the office, but they were not readily available. It was a difficult problem here also, so we went back and consulted the union records which we have. They cover a lot of men, going back over quite a period of time, and we compared the people we could find in our own union records with an estimate of the number of people in the industry, and we frankly were surprised to find that so many men or come up with an estimate as many men having licenses as we did. Now it naturally follows that every license does not mean that a man is licensed for all areas of the river. But they have a great many |