maintain the quality of service required by the public interest and to meet efficiently and economically the needs of mail transportation." In the case of the railroads, there has been no hint of subsidy in connection with mail payments. The endeavor of the Commission has been to fix compensation which would cover the proportionate part of cost of operation and return fairly assignable to mail service. Such service, however, is so large and important a factor in air transportation that the language above quoted might be interpreted as requiring the carriage of the mails to sustain much or all of the burden of profitable operation, if it should develop that no other classes of service were capable of sustaining their shares. Whether such a result should be regarded as a subsidization of air carriage through mail payments is arguable. It may also be that some degree of subsidization of air transportation is necessary or desirable in the public interest. We express no opinion on that point. All that the Commission asks is that its duties with respect to the determination of mail payments be made as clear as possible, so that there may be no question as to what the Congress intends the Commission to do in this respect.

In this connection it should be noted that in section 304 (a) (7) S. 2 directs the Commission "to study and report to Congress from time to time whether, in the public interest, the Government should extend direct or indirect financial aid to air carriers or others assisting in air transportation, including recommendation as to the form of such aid and method of distribution."

This would seem to indicate that no direct or indirect financial aid is intended in the provisions of section 311. Yet it might well be argued by an air carrier, in view of paragraph (e) of that section, that enough must be paid to it by the Government to enable it to carry the mails efficiently and well, that such carriage requires operation at a profit, and that the necessary profit must all be secured from the mail, since it is impracticable to obtain it from any other source. In addition to the above matters of rather general importance, there are matters of minor importance which invite comment, and quite a number of places where we think the language of the bill might be clarified or otherwise improved to advantage. There are, however, other bills which have been or are to be introduced covering the same general subject, and we would prefer, with the consent of your committee, to withhold suggestions as to details until we have had an opportunity to review these other bills, and perhaps also to consider the criticisms and suggestions which may be offered at the public hearings. In our judgment, our comment on these matters of detail will be more helpful to the committee, if it can be so deferred.

So far as the general purpose of S. 2 is concerned, and also the general nature of its provisions, the bill has our approval, subject to the comments above made. Respectfully submitted.

JOSEPH B. EASTMAN, Chairman, Legislative Committee.

Senator MCCARRAN. Further qualifying, may I be permitted to say that while this hearing is primarily on S. 2 there is before the committee H. R. 4600, introduced by Mr. Ellenbogen, which bill is my original S. 2 introduced by Mr. Ellenbogen in the House; and also Senate bill 1760, which is my bill introduced in the Senate, and which is supplemental to S. 2 and is a companion bill to the Crosser bill in the House, known as H. R. 4652. My last amendment introduced in the Senate is comparable with H. R. 5234, introduced by Mr. Lea.

I make that statement, Mr. Chairman, so that the record may be clear on this matter and that the entire subject may be considered by the committee from its broadest aspect with a view of getting the very best out of this proposition that we can obtain.

Senator DAVIS. In just a few words, Senator McCarran, what will your bill do? For what does it provide?

Senator MCCARRAN. It will attempt to regulate commerce in the air, especially the regulating of those lines that have been granted contracts for the carrying of the mail. It will provide for all of the regulation of commerce by air to be in the Inetrstate Commerce Commission, so that certificates of convenience and necessity may be issued by the Interstate Commerce Commission where they have investi132711-37-pt. 1-4

gated and find that a line should be established or continued, so that all lines to which a certificate of convenience and necessity has been issued by the Interstate Commerce Commission shall carry the mail at rates of pay to be fixed by the Interstate Commerce Commission, the same as rates of pay are fixed on railroads for the carrying of the mail by the Interstate Commerce Commission and other agencies, and the same as on bus lines.

In other words, my idea is that we have now three departments of the Government attempting to regulate commerce by air. One is the Post Office Department, the second is the Department of Commerce, and the third is the Interstate Commerce Commission. No two of them are coordinated; no two of them are working together. This industry can best be put forward, in my view, by having one regulatory head, so that the industry will grow with the regulations and the regulations will grow with the industry.

With that in mind I first introduced a bill creating a separate commission for air commerce. I have never abandoned that idea. I still believe it should be handled in that way; but the President refused to go along with it. The bill was brought out on the floor of the Senate and I lost. I then re-formed the bill and introduced what was then Senate bill 3027, but by reason of illness I was unable to carry it through the last session of Congress.

In addition, Senator Davis, to what I have stated, we are attempting to bring in certain definite safety features so that the Interstate Commerce Commission shall have a decisive word in saying what safety features shall be installed and so that responsibility shall be placed in some one head rather than having the Department of Commerce throw it over onto the Interstate Commerce Commission and the Interstate Commerce Commission throw it over onto the Department of Commerce, and both of them looking to the Post Office Department to furnish the money for carrying it out.

Senator DAVIS. Have you made provision in your amendment to cover air transportation by foreign lines so as to cover immigration and public-health regulations before the passengers get aboard?

Senator MCCARRAN. I have not gone into that much of the details so far, but it will be no trouble to have that taken care of.

There is, as you know, now a line established, calling your attention to the map on the wall, on our west coast by way of our insular possessions to the Orient. That line has been mentioned in the press and we know about it. There is now in contemplation the establishment of a line from the east coast to London, which will in all probability take off from somewhere along the Nova Scotia coast. That line we are interested in because today before the Appropriations Committee there is the contemplation of what might be termed a subsidy looking to the establishment of an American line which will probably be or may possibly be the Pan-American Line. The PanAmerican Line also extends along the east and west coasts of the American continent, on both sides. It is the Pan-American-Grace Line on the west and the Pan-American Line on the east. Those lines are engaged in foreign commerce by air, and some features of regulation embraced in this bill will apply to them. The regulation in many respects will develop as the hearings go on. Is there anyone here from the Interstate Commerce this time? (No response.)

Commission at

Senator TRUMAN. Is anyone here from the War Department?
Colonel ROBERTSON. I am from the War Department, sir.

Senator TRUMAN. The committee would be glad to hear from you with reference to the bill.

STATEMENT OF COL. W. M. ROBERTSON, GENERAL STAFF WAR DEPARTMENT, WASHINGTON, D. C.

Senator TRUMAN. Colonel Robertson, you may state your ideas with reference to this bill, if you please.

Colonel ROBERTSON. Mr. Chairman, the War Department has gone over the several bills, and we find the last bill, or substitute bill, the most satisfactory from the viewpoint of the War Department, in that it is not so restrictive as the original S. 2.

Senator TRUMAN. You are referring to the bill known as S. 2 amendment?

Colonel ROBERTSON. Yes, sir.

Senator TRUMAN. In what way is it less objectionable?

Colonel ROBERTSON. In original bill S. 2, on page 3 the bill defines navigable air space, and later on, quite a distance further along in the bill, on page 59, it provides that no person shall fly on or through airways described as interstate airways unless such person fully complies with the rules and regulations issued by the Commission for the use of and the proper control of such airways. We felt that that might be rather restrictive in regard to airways adjacent to or somewhat near our air fields, visualizing particularly the situation that might arise in the vicinity of San Antonio, for example, where we have a large number of training areas.

Generally speaking, that was the principal item that the War Department thought might lead to some difficulty.

Senator TRUMAN. That is omitted from the amendment?

Colonel ROBERTSON. Yes, sir.

Senator MCCARRAN. Taking it a as whole, Colonel Robertson, the War Department rather favors the amendment?

Colonel ROBERTSON. Yes; it does.

Senator MCCARRAN. The only serious objection the War Department had to the original bill was that which you have just mentioned? Colonel ROBERTSON. Yes, sir; it was.

Senator MCCARRAN. Taking it, then, as a whole, either S. 2 with that element omitted, or the amendment to S. 2, would be satisfactory to the Department, so far as you know?

Colonel ROBERTSON. It would be generally satisfactory; yes, sir. Senator MCCARRAN. Of course you are interested in the matter from the standpoint of national defense?

Colonel ROBERTSON. Yes, sir; we are.

Senator MCCARRAN. Do you not think that this measure, with the objectionable feature that you have mentioned eliminated, would go a long way toward the development of our national defense?

Colonel ROBERTSON. Yes, sir; exactly as you have pointed out in your opening remarks, Senator.

Senator MCCARRAN. Thank you very much.

Senator TRUMAN. Has any member of the committee any questions to ask of Colonel Robertson?

Senator AUSTIN. I would like to ask a few questions, Senator.

I have not had an opportunity to study this amendment in the nature of a substitute at all. Is it an addition of another part to the original S. 2, or is it intended to take the place of S. 2?

Senator TRUMAN. Senator McCarran will answer that, perhaps. Senator MCCARRAN. I would say, Senator Austin, that before you came in I had explained that S. 2 was introduced in the first instance, and then, after study and conferences with the best authorities that Í could find, after holding long-continued conferences, if you please, I concluded to introduce these amendments; and the amendment to S. 2 is one. It is rather clarifying, and it omits some of the features that were objected to by the departments, and perhaps objected to in some instances by the industry. I think, if you will take them and read them, you will find that the amendment and S. 2 are to be distinguished largely from the standpoint of the placement of language, with the idea of clarifying it, rather than from the standpoint of any change of policy.

Senator AUSTIN. Do both of them adhere to the theory of concentrated control and management of air transportation in the Interstate Commerce Commission?

Senator MCCARRAN. Yes; that is the basic principle, with the idea of letting the Interstate Commerce Commission have regulatory power and powers to issue certificates of convenience and necessity, power to fix charges for the carrying of mail and commodities

Senator AUSTIN. Before we get through with our hearings I would like to have a talk with Senator McCarran about that element.

Senator MCCARRAN. I shall be very glad to talk with you about it, Senator AUSTIN.

Senator AUSTIN. I want to ask the Colonel with regard to the sentence that he called attention to on page 3. I want to ask him what he understands that to mean. Does he understand that word "prescribed" to mean limited, prohibited, or permitted?

Colonel ROBERTSON. As the War Department understood that phraseology, Senator, we did not know that there was any law at present defining that. We thought that the Interstate Commerce Commission might place an undue restrictive interpretation in issuing instructions relative to it.

Senator MCCARRAN. You are referring to the air surrounding your landing fields?

Colonel ROBERTSON. As to just what that air space really meant. There is another feature of this. In many places in this bill I think it prescribes that any airplanes using the airways shall be fitted as prescribed by the Interstate Commerce Commission.

Senator MCCARRAN. Yes.

Colonel ROBERTSON. Many of our training ships are not so fitted, and it would practically prohibit them from flying in or near the airways prescribed by the Interstate Commerce Commission.

Senator MCCARRAN. In that regard, while it may not be pertinent, do you not think that your ships should be so equipped as to comply? Colonel ROBERTSON. I do not think it is necessary, Senator, for our training ships to have all the refinements required of transcontinental ships. However, I am not an air man, and I should prefer to have Colonel Young, who is here, and who is a member of the Air Corps, answer that question.

Senator MCCARRAN. I am going to ask the same question of Colonel Young, if I may.

Senator TRUMAN. Colonel Young, will you answer that question for the Senator, please?

Colonel YOUNG. I do not think that our training ships should necessarily be equipped with radio and all the other instruments that are required for navigating over the airways, because their flight is mostly confined to the immediate vicinity of the air field.

Senator MCCARRAN. The thought I had in mind, Colonel, was this. My mind goes back to an incident that I think perhaps is as regrettable as any that this country has had in years, and that is when the mail contracts were canceled and the Army was called upon to carry the mail, with disaster that it seemed to me was very outstanding and that we all regret. It seems to me that if at that time our Army ships had been equipped with the same modern devices as the private ships were that were taken off of the runs, 11 or 12 young lives would have been saved.

Again, another incident comes to my mind to which I wish to draw attention. I do not know that it is properly before us at this time; but, for instance, if one were called upon to take an emergency flight, as I was about a year and a half ago, when the War Department very graciously gave me permission to use a War Department plane, it would be found that such plane is not modernly equipped. I was told that I could only fly in daylight, that they had no equipment enabling them to fly at night. The pilot had to stay grounded. It just struck me that they should be equipped the same as commercial planes, at least to fly at night.

Those are just thoughts that I have on the subject, and it may be that they are out of place at this time, but I am glad to have your criticism, and I should like to have you expand on it if you see fit.

Colonel YOUNG. The only thing that I would like to say on that is that so far as the air mail carrying by the Army is concerned, I do not think there were any training planes used for the carrying of the mail. They were all planes that are termed combat planes.

Senator JOHNSON. How about the pilots, sir? Were they trained to use the equipment that they found in the planes that they operated? Colonel YOUNG. At that time they were all qualified pilots.

Senator DAVIS. What would be the additional cost to the Army to so equip these training planes?

Colonel YOUNG. I am not prepared to say, sir.

Senator MCCARRAN. Going back to the thought that a training plane would be prohibited from traveling on an airway, under these regulations, would a training plane be required under any conditions to travel on airways? Is not a training plane a plane that does not fly any particular airway?

Colonel YOUNG. I do not think that a training plane would be required to fly over an airway, but it might, while flying in the vicinity of the training airdrome, cross such an airway.

Senator MCCARRAN. Aside from that, have you any objection to this bill?

Colonel YOUNG. No, sir.

Senator MCCARRAN. You think, do you not, Colonel, that the measure is a step in the right direction?

Colonel YOUNG. I do, sir.

Senator MCCARRAN. That is all I have to ask.

Senator AUSTIN. Have you examined this subject, Colonel, with reference to the question of whether it would be better for air trans