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for compensation 'under special and individual contracts or agreements.' latter requirement is not merely that the transportation be performed under contract. Whatever the contract or agreement, it must be special and individual. It goes to the subject matter of the contract and means a special and individual service which is required by the peculiar needs of a particular shipper."

If the service performed by a contract carrier is a special and individual one and one "required by the peculiar needs of a particular shipper," it would not appear that substantially the same service would be required by any other shipper. It would seem, therefore, that by the very nature of the contract carrier's individual service that it would not be able to unjustly discriminate between shippers even though it might be charging different shippers different rates. In the Matter of Restricted Rates (20 I. C. C. 426, 437), the Commission in finding certain rates to be unjustly discriminatory stated:

"The tariffs which contain rates applicable only to the shipments of certain consignees or when a commodity is put to a particular use and the rates which are so restricted to the use of certain shippers alike are in violation of section 2 of the act, and unjustly discriminatory in violation of section 3 of the act, and therefore unlawful.”

The Commission in issuing permits to contract carriers has restricted the service to certain classes of shippers, and has imposed restriction which limits the transportaton of certain commodities to a specified type of business or class of consignee. When rates are published pursuant to such permits the application of the rates must be so restricted. It would appear that rates so published by a contract carrier would be discriminatory through no fault of the carrier. It is apparent from a review of court and Commission decisions that the concept of unjust discrimination and that of contract carriage are entirely inconsistent. This is true because the prohibition against undue discrimination is designed to require carriers who serve the public to treat all shippers alike under the same or similar circumstances, whereas the law and regulations governing contract carriers is designed to limit the service offered to a particular class or classes of shippers and receivers.

Under the proposed new definition, contract carriage will be limited to particular kinds of operations. The charges for such transportation have little or no importance in the overall competitive situation. Since the services performed are not held out to the general public, they are, by definition, discriminatory and noncompetitive with common carriage. To prescribe nondiscriminatory rates might result in unduly limiting the flexible service which contract carriers are uniquely fitted to perform. We therefore are opposed to this proposal.

The conference recognizes that there are honest differences of opinion among the industry as to what kind of legislation will serve the best interests of all forms of transportation by motor vehicle. However, we believe that some permanent solution is long overdue, and that the recommendatitons herein made will result in the establishment of a permanent workable solution which will be equitable to all concerned.

We understand that some groups desire a public hearing in this matter and that others desire to file reply statements. The conference appreciates that the suggestions herein made may have far-reaching effects and therefore, believes that any interested party should have full opportunity to express its views. Accordingly, we have no objection to reply statements or oral hearings and will participate in either or both if so ordered by the Commission. Respectfully submitted.

CONTRACT CARRIER CONFERENCE,
AMERICAN TRUCKING ASSOCIATIONS, INC.,
By CLARENCE D. TODD,

TODD, DILLON & CURTISS,

of Counsel,

Washington 5, D. C.

AUGUST 2, 1954.

DALE C. DILLON,
CHARLES F. RIDDLE,

Its Attorneys.

CERTIFICATE OF SERVICE

I, Clarence D. Todd, do hereby certify that on this 2d day of August 1354, I have served on all known interested parties in this proceeding a copy of the foregoing statement by first-class mail.

CLARENCE D. TODD.

APPENDIX 6

STATEMENT SUBMITTED BY H. W. SPEYER, PRESIDENT, AAA TRANSPORTATION, INC., INDIANAPOLIS 5, IND., TO THE SENATE SMALL BUSINESS COMMITTEE, DECEMBER 1, 1955

Here is the question in substance:

Is the aggrandisement of a few railroad corporations and a few union moguls more important to the United States and the free world, than the preservation-and that should include reasonable protection and even some measure of reasonable expansion possibilities of small free enterprise? The backbone of this country is its capitalistic middle class. To liquidate it, is the Kremlin's greatest ambition to preserve and protect and develop it-and thus show the feasibilitythe practicability of a free democratic, capitalistic society-should be the greatest concern of every American citizen and every Member of Congress.

Gentlemen, unfortunately I learned only this week from reports in Transport Topics that your committee was about to hold a hearing in re Interstate Commerce Commission practices on December 1 and 2, and since it is not possible for me, a small trucker, to leave my business on such short notice to appear before your committee in person, I take this means to call a few quite pertinent facts and features to your attention.

Permit me to start my observations by thanking you for the opportunity which you provide for small business to be also heard by Congress. Usually it is big business, which by means of well-trained lobbyists and attorneys, etc., bring its notions to the attention of this lawmaking body, and so it is small wonder that Congress with so much slanted information being made available in abundance, knows little, and that only by accident, about the problems of small business. This is presumably the reason why its complaints and hardships go mostly unheard, unrecorded, and without relief. It could be and it should be different.

This is, of course, not a new experience in human history and more than 100 years ago Mr. Karl Marx, Mr. Engels, and others observed this phenomenon and made the recommendation to exploit such situations systematically, to speed the early development of a communistic society.

If it were not so alarming in view of the present world situation, it would be outright funny to note how closely ICC, innocent, no doubt, of any knowledge of the communistic catechism, lives up to these prophecies and plays out to perfection the role which these theoreticians of communism assigned to governmental agencies.

Said the founding fathers of communism: "Every union of workers should make it its business to harass as much as possible the capitalistic concerns in each nation. Where the interests of the larger concerns conflict with those of the smaller ones, the unions should always take the side of the larger ones against the smaller ones. The purpose of this measure is (a) to eliminate, to liquidate, as many of the smaller ones as possible, and thus reduce their proprietors to the ranks of the proletarians; and (b) to enlarge the larger units to the point, where their management will become so impersonal that the ownership of these large units can be changed from private proprietors or stockholders to government ownership with a minimum of upset or commotion. Regulatory governmental bodies should always be encouraged to hasten this development, and the workers through their unions should make it a point to impress these bodies, that their interest lies in the formation of larger and ever larger units, and in the systematic elimination of the smaller ones."

Thus spoke the saints of communism about 100 years ago. They gave the scenario, and ICC acts it out faithfully in 1955.

By its very nature and its broad powers ICC has probably more direct influence upon the flow, and therewith upon the extent of commerce than any other governmental agency in United States. Unlike in Europe and other sections of the world, where much business is still being done on a for-the-local-market scale, in the United States even relatively small producers often supply a very broad and very often a national market, extending literally from coast to coast. The flow of most of this traffic, by now fully adjusted to operate on a broad scale, covering every nook and cranny of the land, is under the jurisdiction of ICC.

ICC was created to control certain inequities which developed when this country was rapidly changing from horse and buggy to railroads and later, when certain abuses set it, in the operation of trucks, Congress gave ICC the power to regulate truck transportation.

It is clear to every thinking person that the cure for communism is not anarchism nor nihilism. The cure for the faults and errors of ICC cannot be the abolition of all regulation, which reverts us to the law of the jungle. Such ideas have been advocated before your committee. Yet the remedy would seem to lie rather in closer supervision by Congress, so as to make sure that its administration remains in principal, consonant with our democratic way of life, which assures opportunity for all, the great and the small. Congress would seem to be the only body which can cope with this task, since the United States courts are failing us far too often, almost with dependable regularity, whenever economic issues are involved.

Now let us turn to a specific example, with which this party happens to be quite familiar. Let us consider a few features of MC 43, an ICC proceeding, largely relating to truck-safety measures. It resulted in the issuance of a series of orders on the part of ICC, many of which are purely technical and proper, and therefore, unquestionably in the public interest.

No objections have been raised against these true safety measures. But two provisions were slipped in under the guise of safety, which have nothing whatever to do with safety, but are motivated by altogether ulterior motives, which do not square with the public interest at all, if critically analyzed. To evaluate them properly, they must be correlated to other actions, which are being brought now by these same interests, piecemeal, as it were, now before Congress, now before ICC, in order not to awaken the sleeping dogs.

It is clear to anyone who has paid any attention to traffic matters, that the railroads, when they failed to take up trucking themselves in the period between 1920 and 1930, overlooked a good thing. Yet, it turned out for the best of this country. Tens of thousands of ambitious people took up trucking, set up during the depression a badly needed service, of an adaptability, flexibility, and dependability, which reaches today very literally to the very end of every road, the like of which the world has never seen before, and which is still unequaled today in any other country in the world. Beset by many forms of inconsistent and contradictory State regulations, many of them railroad sponsored-and still in existence this very day--this industry gave employment to a great many of the unemployed, and yet rendered good service at rates, which were often as economical on a retail, small shipment, 1.t.l. basis, as the rates used heretofore for handling shipments on a wholesale carload lot, c.l. basis.

Eventually even rail management realized and admitted that trucks are here to stay, and then the more aggressive elements among the railroads began to scheme. If there was not perhaps still a way, how to get now into the trucking business on a large scale.

Let it be said to the credit of the ICC, that ICC fairly consistently refused to let the railroads enter trucking through the front door. at least that was the climate in ICC from 1935 until around 1950 to 1952. Yet, as time went on more and more concessions were given to the rails and probably in too many instances the railroad opposition to truck expansion was given quite undue consideration. But while the railroads often do not seem to be gifted with much foresight, they certainly have patience, persistency, and plenty of money for consistent legal efforts. And last, but not least, they have some very good jobs for those who may lose their position in ICC in case an attack of economy overtakes Congress.

To make a long story short: The railroads want to get into the trucking business in a big way at any price, or cut down trucking to suit their wishes. There are also some large truckers who feel that they have much to gain, at least in prestige, if they could just merge with the rails and between them they seem to have now found a formula. The formula calls for the elimination of the smaller truckers, whose rights are, as a rule, too small in extent to interest the railroads, yet are directly competitive to these larger trucking firms. Once the aim was clear, the strategy was soon decided upon.

Someone, somewhere in that crowd had the happy thought to use the old formula for wrecking a competitor, a propaganda of casting doubt upon the respectability of such competitor before ICC. And someone must have added the idea let us stay in the background, let the unions do the talking.

Now we must for a moment consider the union situation. The railroads have been very much under union control-trucking considerably less. And one of the elements, which retards complete unbridled union control, such as the rails have known for years, is the owner-operator, a person operating usually one trucking unit, owning and driving it himself. Usually this party belongs to some union, but being a small capitalist, rather than a class-conscious prole

tarian, he does often not see eye-to-eye with the union on some of their pet ideas, and he is therefore only tolerated by the union, because they surely want to get his money. Actually they have no use for him, and on many occasions they have stated this very frankly. His biggest fault is that being at heart a capitalist, he is not pliable enough for union purposes.

He fills a great economic need for the smaller trucklines. He is their motorpool; he is dependable, since he has a personal investment, he is a more careful operator because carelessness or recklessness will cost him his own, not the boss' money, and he takes personal interest in the way he does his work, so as to build a reputation for himself, which will assure him of repeat employment, which is to him repeat business. He is not a proletarian at heart, he is the very incarnation of American free enterprise.

Through the front door the railroads so far have not been admitted to any great extent to the Nation's trucking business. But here opens a back door with great possibilities, which the rails apparently realize. All one needed to do was to knock out the motor pool of these smaller carriers. Then their flexibility and adaptability would be destroyed and soon their service would become as slovenly as the rail service of yore. Or if they loaded themselves down with lots of extra equipment to furnish service under peak loads, having this extra equipment standing idle a great deal of the time, they would financially overburden themselves to such an extent that they would be compelled to raise their rates, which would reduce their competitive advantages. Also it would place them more completely under union control, as the number of their "proletarian" employees would increase. This would mean less efficient and less interested help. The least benefit to the rails, the competition would be weakened, and at the best, and more likely, the competition would be eliminated.

Yet the United States has such a thing as antitrust laws. The United States courts often understand trust actions, when they see them. But here was at long last the great opportunity to sell Uncle Sam's ICC a pig-in-a-poke and get away with it in the courts under the guise of safety. And more beautiful, the unions, not a bit handicapped by antitrust laws and antitrust actions, could carry the ball. So everything was perfectly simple and simply perfect, or almost so. With two very harmless and eminently "safe" sounding rules promulgated by ICC, the thing should work unless Congress intervenes: (1) A rule that all leases between any owner-operator and a truckline are to be made for not less than 30 days, and in order to "double deck" the effect; (2) a rule forbidding the payment of such owner-operators on a percentage-of-the-income basis. Neither rule can possibly enhance safety on the highways, but they serve extremely well the outlined ulterior motives.

As expected by the rails, the ICC soon "swallowed" the "safety" angle, but cynically enough at once, in the same breath, exempted the railroads from complying with these great safety features. The Federal courts never thought twice about the matter, they "rubber-stamped" and O. K.'d these rules. Upon complaints from other powerful and financially well-heeled groups, such as the oil industry, the furniture movers, the auto industry, and a few others, the ICC modified the rules and exempted these groups from compliance. And when the ICC and the rails sensed that the farm groups might upset the whole applecart of letting the rails, now through the back door in a big way, into the trucking business, ICC exempted everybody who had that "farmlike" smell about him, provided he certifies that he either came lately from, or intends to return soon to, some barnyard.

The rules have today that peculiar look-somewhat defying such "old-fashion” conceptions as that the laws in a democracy should apply equally to everybody— that they read in effect:

"These rules have to be observed by every citizen and resident of the United States, except those who had enough money to send squads of lawyers to Washington, such as the rails, the auto industry, the oil industry, and, to pacify Congress, all the farmhands. For the poor, all our rules apply."

Apparently, these almost all-embracing exceptions, everybody is exempted, except those the rails want to have liquidated in order to lay a good ground floor for the rails to make a good case to enter trucking in conjunction with a few of their pet truckers and the unions. ICC reassured its own conscience by stating in the report that the United States Supreme Court had upheld their power to do so, and quite cynically they added: Few owner-operators appeared in the hearing and they seemed to be in favor of these rules. (That most of these owner-operators were union sponsored, in order not to use the expression "union stool pigeons" (see the record before the House Committee on Interstate and Foreign Commerce, 1953), ICC's report failed to mention.

The writer of this message is not even affected to any extent worth mentioning by the 30-day rule provisions, since all his operators have been with him for years, but the right to change jobs and employment at will is here involved, and is an inherent American right which should never be abridged. The proposition of a 30-day forced servitude is not American, especially it should not be abridged under the guise of safety for some, and continued though the safety factors are the same for others, with the only discernible qualification for the exemption being that their operations are not (or not so) obnoxious to the empire-building dreams of the rails and the unions.

It is sad, but it is true, that the United States Supreme Court has upheld the power of ICC to issue such discriminatory regulations. Whether this Courtif it read the present list of exemptions—would still endorse the matter is still doubted by optimistic American citizens. But cynics assure us that the majority of the Court would go along again.

The ICC has claimed that the 30-day rule is needed to assure proper responsibility for public liability and property damage toward the public. Since ICC also permits the subleasing of leased units to other carriers, the issues, in case of an accident, are quite possibly even more confused than now, and will, quite likely, involve by fiat of ICC wholly innocent parties. The lessee carrier is not supposed to use the leased unit in any territory in which the lessor carrier does not also have operating rights, and that means insurance on file for that district. If now the lessee carrier, perhaps through an error of his employees, sends this vehicle into a district for which the insurance company of the lessor is not bound, then very obviously it will leave the lessor carrier, without his knowledge, and without his consent, in an illegal situation without protection from his insurance company, fully liable to the public. And if ICC would be too much criticized, they would probably add to his sad predicament by instituting court action against him for one excuse or another. (See the Tunnel-Explosion case, and the observations of Justices Douglas and Black.) The liability without insurance protection will wreck many of them, which is probably one of the purposes of the rule. At best it will leave him open to blackmail. By simply threatening him with cross-examination before the ICC, the rails and the unions can effectively keep him out of any hearing in which he might want to protest the railroads.

Many rules of ICC are deliberately so designed, as Justices Black and Douglas have already pointed out years ago, in their dissenting opinions (in the Tunnel Explosion case and the MC-43 case) that whichever way a carrier decided, he can still be found in violation, if ICC needs a scapegoat. The Justices very properly said: If ICC dislikes or disapproves any given method or procedure, it should issue its orders in positive forms; stating how it should be done properly, and not leave the way open for further confusion, by issuing merely negatively formulated orders, which settle nothing.

Ohio has solved the problem very sensibly and satisfactorily to all concerned. Realizing the dangers of the 30-day rule, they never adopted it. However, they require now that any vehicle owner must have public liability and property damage insurance on file with PUCO to cover his dead heading operations. No authorized carrier is permitted to lease a piece of equipment, until shown that this certificate of insurance, stamped by the PUCO, has been obtained. It solves the problem, of which the ICC has justifiably complained, lack of public liability and property damage insurance, while deadheading, properly and completely. Yet it does not tend to involve one carrier into the operations of another carrier over whom he has no control, but for whom he may become, by fiat of the ICC, liable (and believe it or not, this was O. K.'d by the Supreme Court) without his choice, without his knowledge and without his consent.

Ohio also tried the "no-percentage" rule and abandoned it as unworkable and unrealistic after a year of trial.

However, it was said above, that ICC "double decks" its 30-day leasing rule with a provision that the payment for the services furnished by an owneroperator who drives himself, or has his own employees to drive the unit must not he based upon a percentage of the revenue derived by the carrier.

This is the most treacherous of all regulations ever issued by ICC, since it will permit the persecution, under the guise of legal prosecution in Federal court, of every carrier, who for any reason whatsoever, becomes "persona non grata" to either ICC or any employee of ICC, or to any competitor.

Since any payment made by any carrier to any owner-operator for any load such an owner-operator has handled, will clearly constitute a percentage of his own income derived from the load the owner-operator handled. The rule is per se sheer nonsense; it is an impossibility. If a load handled by an owneroperator brings the carrier under his legitimate tariff charges $100, then any

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