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this Act, formulate and promulgate the rules and regulations which it is authorized and directed by such section 233 to prescribe and promulgate: Provided, That the Commission shall, if found by it necessary or desirable in the public interest, by general or special order, postpone the formulation and promulgation of such rules and regulations to such time after six months after the date of enactment of this Act as the Commission shall prescribe, but not beyond twelve months after the date of enactment of this Act.

The CHAIRMAN. I have asked Mr. Foristel to prepare the agenda for today, and I will turn the agenda over to him.

Mr. FORISTEL. There are approximately 60 barge lines represented here in the committee room. I would like to call as the first witness, Mr. Joseph D. Henderson, who will outline the complaints of these gentlemen.

Mr. HENDERSON. My name is Joseph D. Henderson. I am the national managing director of the American Association of Small Business, incorporated under the laws of the State of Louisiana, February 20, 1942, with national headquarters in the city of New Orleans, La.

The CHAIRMAN. We are glad to have you here, Mr. Henderson, and we would like to have you proceed with the testimony.

Will you raise your right hand and swear that the testimony you are about to give will be the truth, the whole truth, and nothing but the truth?

Mr. HENDERSON. I do.
The CHAIRMAN. Proceed.

TESTIMONY OF JOSEPH D. HENDERSON, NATIONAL MANAGING

DIRECTOR OF THE AMERICAN ASSOCIATION OF SMALL BUSINESS, NEW ORLEANS, LA.

Mr. HENDERSON. The entire membership of the American Association of Small Business is grateful for your invitation to appear before this committee in behalf of small barge-line operators in opposition to the extension of the jurisdiction of the Interstate Commerce Commission over the transportation by water of all dangerous cargo.

A large majority of all the transportation in the United States which includes railroad, air lines, and the larger common water carriers are operating at a loss. In contrast a small group is healthy and operating at a profit. This small segment is represented here this morning asking to remain healthy. They are the small independent contract barge-line operators. They fear the same regulation by Government under which the large transportation group is handicapped. I have always considered our waterways as the highways of free enterprise from the beginning of time. I am convinced that in a large measure the cost of reporting to Government is the reason that the majority of carriers find themselves in financial difficulty.

All too seldom are those in public office commended for meritorious service rendered to the people. The members of this association are grateful for the splendid work that has been done by the Honorable Walter C. Ploeser, chairman of the House of Representatives Select Committee on Small Business. In our opinion, the members of Congressman Ploeser's committee, including the staff, have done an outstanding job. The Select Committee on Small Business has been of great assistance in working on the problems confronting small businessmen of our Nation.

At the regular monthly meeting of the board of directors on August 27, 1947, Capt. H. G. Koch, one of our directors, called to our attention the problems faced by the small barge-line operator under the supervision of the Interstate Commerce Commission. In his own case, it became so difficult to operate his business with all the restrictioned regulations and red tape he has experienced as a regulated carrier that he has finally decided to relinquish his permit. Other complaints were presented by members of our association, and on September 25, we wrote the Select Committee on Small Business concerning these conditions. Mr. Harry B. Jordan, chairman of the Water Transportation Committee of the American Association of Small Business is here today and will present his statement later.

No effort will be made on my part to go into the technical aspects of barge-line operation other than to mention the hardships and damages which will be experienced by small bulk cargo contract barge-line operators who are now exempted from the regulations of the Interstate Commerce Commission. Should unregulated carriers be placed under Interstate Commerce Commission rate and permit regulations, by a slight modification of a bill presently pending in the United States Senate, their great problem would conceivably be maintaining records, securing cargo rates, and all the other ramifications caused by complete Government restrictions.

One of the principal paragraphs in S. 1141 will be found on page 3, line 16, designated as (j), which reads, “dangerous articles mean any substances having explosive, combustible, inflammable, oxidizing, corrosive, or poisonous characteristics." This wording is brought to the attention of the committee and the members of this association as well as all small barge-line operators, because of the all-enveloping interpretation which can be placed upon its meaning. A dangerous article may even be the paint of the hull of a barge, because we know that paint oxidizes and is also corrosive. This may sound ridiculous, but funnier things have happened when some of the laws of our land have been interpreted.

There is no need to elaborate further, for others here will testify to the fact that S. 1141 is unnecessary and that it should not be enacted into law, because the small cargo carrier barge lines are now properly supervised by the United States Coast Guard. The Coast Guard record is enviable and statistics will show the minute loss or damage per mile ratio experienced in bulk cargo barge operation.

In my opinion, this bill could cause an overlapping of authority, which has proven inefficient in Government operations in the past. We have too many bureaus now created to accomplish measures which should have been allocated to the departments of Government already in operation. Bureaucracy is not the American way of life.

There are certain interests who would be pleased to have this legislation enacted for it might force a number of small barge lines to go out of business. This would mean that other already overcrowded transportation systems would be called upon to handle the bulk cargo barge line operators' traffic. Higher freight rates would be experienced, and, of course, the small businessman and the ultimate consumer would have to pay in the final analysis.

Let me emphasize that the American Association of Small Business has always been against regimentation of business. The association

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therefore takes the stand that enactment into law of S. 1141 would be a dangerous step toward suppression of free enterprise. Rather than attempt to testify on the technical detriments to independent small barge line operators passage of this bill would create, I would like to simply state that men of business already experience too many restrictions. The American Association of Small Business is against S. 1141 because the association is against any reduction of individual initiative.

Thank you.
The CHAIRMAN. Do you have any questions?
Mr. PATMAN. Not now.
Mr. RIEHLMAN. Not now.

The CHAIRMAN. We may want to question you later, if you will be available.

Mr. HENDERSON. I will be available. Thank you.

Mr. FORISTEL. At this time I would like to call Mr. Frank Perrin, executive assistant to the Director of the ODT, and the official representative this morning of the Interstate Commerce Commission, whom I have requested to state the ICC's views regarding regulations of certain cargoes and its possible effect on this group of small businessmen.

The CHAIRMAN. Before Mr. Perrin proceeds, I would like to say that this legislation which is mentioned is before the Senate Committee of Interstate on Foreign Commerce. It is not the intention of this House committee to inject itself into the province of any other committee, particularly another body of the Congress.

But after discussion with the Senate, following complaints, there was an understanding that this hearing would probably be advisable, and this committee had invited either members of the Senate committee or their staff to observe the hearing.

Mr. FORISTEL. That has been done in the House, too.

The CHAIRMAN. That has been the common practice of this committee in the House, with other standing committees.

Mr. FORISTEL. The House Interstate and Foreign Commerce also.
The CHAIRMAN. They have also been invited to observe.
Now, Mr. Perrin, if you will identify yourself for the record.

Mr. PERRIN. My name is Frank Perrin. I am at present Executive Assistant Director of the Office of Defense Transportation. On this particular matter this morning I am speaking for the Interstate Commerce Commission.

The CHAIRMAN. Will you raise your right hand and swear the testimony you are about to give will be the truth, the whole truth, and nothing but the truth, so help you God?

Mr. PERRIN. I do.
The CHAIRMAN. Proceed.

TESTIMONY OF FRANK PERRIN, EXECUTIVE ASSISTANT DIRECTOR

OF THE OFFICE OF DEFENSE TRANSPORTATION, ACCOMPANIED BY V. E. HANINGER

Mr. PERRIN. Mr. Chairman and members of the committee, I appreciate sincerely the opportunity to appear before your committee and explain the reasons for the Commission's recommendations to Congress for the enactment into law of S. 1141, a bill to amend the Transportation of Explosives Act, also the purposes of this proposal.

My prepared statement has been approved in its entirety by the Legislative Committee of the Interstate Commerce Commission.

As I understand it, the complaint to your committee regarding this proposed bill is, basically, that it will subject contract carriers by water of bulk petroleum and petroleum products to complete economic regulation by the Commission.

At the outset it should be explained that the law relating to the transportation of explosives and other dangerous articles is completely divorced and separate from the Interstate Commerce Act. The former was originally enacted on July 3, 1866 (14 Stat. 82), whereas the latter was enacted on February 4, 1887.

Water carriers were made subject to the Interstate Commerce Act by the Transportation Act of September 18, 1940. Contract carriers by water of commodities in bulk in non-ocean-going vessels are exempted by section 303 (c), (d), and (e) of the Interstate Commerce Act.

The line of demarcation between the two laws is distinct. The Interstate Commerce Act, on the one hand, regulates the territorial operations of the carriers; the equipment and facilities used in transportation; the rates and charges of those carriers; and, to some extent, their financial practices. On the other hand, the present Transportation of Explosives Act and the proposed bill only regulate the handling, labeling, packaging, and stowing of explosives and other dangerous articles for the protection of life and property.

The Commission, in its fifty-seventh annual report, dated November 1, 1943, recommended on page 133 that the Federal statute commonly known as Transportation of Explosives Act (U. S. Code, title 18, secs. 382–386) be completely rewritten in the light of important developments relating to this subject which had occurred in the 22 years since the last revision of those statutes. Each annual report since that time has reiterated that recommendation.

The need for modernizing this law has been further emphasized by the exigencis of World War II, thus confirming the Commission's foresight and judgment in requesting this legislation. The volume of explosives and other dangerous articles transported has increased progressively beginning with 1939. It is our understanding that the commercial transportation of these commodities is now at an all-time high. Fighting a two-front war accentuated the need for bringing the law up to date. During the war many situations too numerous to mention arose which, under the present law, could not be adequately dealt with. New types of explosives and dangerous articles became common articles of commerce.

Because of the enormous increase in the transportation of explosives and other dangerous articles by other modes of transportation, namely, motor and water transport, the Commission, on April 20, 1943, by order, extended the application of the Commission's explosive regulations to private and intrastate motor carriers. This order was amended on August 27, 1943, limiting its effectiveness to the duration of the war and 6 months thereafter.

Another aspect of regulation of the handling, labeling, packaging, and stowing which is important and demands uniform regulations

has been caused by the increase in interchange of traffic between the various modes of transportation; namely, motor-air, motor-rail, and motor-water. Further, increases in this interchange of goods between various types of carriers can be expected as time goes by

Furthermore, the proposed bill would simplify regulation of the transportation of explosives and other dangerous articles since there would be a single regulatory body to which a carrier or shipper could look for uniform rules pertaining to their transportation. This seems particularly desirable, both from an administrative standpoint and from the point of view of the carriers and shippers themselves. It can be expected to result in substantial economies in the administration of regulations pertaining to the transportation of explosives and other dangerous articles. Of course, the end product of the proposed bill is to assure protection to life and property.

The proposed revision does not attempt to put carriers now exempt from the Interstate Commerce Act under that act. It has no effect whatsoever on carriers' operating rights. Neither does it make the carriers subject to record and report requirements of the Interstate Commerce Act. This applies with equal force to the rate and charge provisions of the Interstate Commerce Act.

Even assuming that the above were not true, the proposed bill as now drawn exempts (1) any public vessel which is not engaged in commercial service and (2) any vessel constructed or converted for the principal purpose of carrying inflammable or combustible liquid cargo in bulk in its own tanks, which vessel is subject to the provisions of section 4417-a of the Revised Statute (U. S.C., 1940 ed., title 46, sec. 391-a.)

In conclusion I should assure you that the Commission in recommending and urging enactment of the proposed bill is not attempting to make a flank attack on any carrier not now subject to the Interstate Commerce Act by placing such carrier under that act.

I thank you.
The CHAIRMAN. Mr. Foristel?

Mr. FORISTEL. Turning to page 4 of your statement, but “assuming the above were not true," may I ask you if these provisions were taken out of the bill ?

Mr. PERRIN. They are.

Mr. FORISTEL. If they were not taken out of the bill before passage there might be some danger to the carriers that the foot would be in the door for regulation.

Mr. PERRIN. I do not think so.

Mr. FORISTEL. Let us go back to page 3 of your statement. The third paragraph you say "Of course, the end product of the proposed bill is to assure protection of life and property.” May I ask you what regulation there is now, by what department of Government, over these cargoes?

Mr. PERRIN. Well, today, the particular carriers here involved, I think they are regulated today by the Coast Guard regulation.

Mr. FORISTEL. Coast Guard regulation ?
Mr. PERRIN. That is right.
Mr. FORISTEL. And they do have a complete code of regulations.
Mr. PERRIN. Yes. I understand that they do.

Mr. FORISTEL. Then this bill, only attempts and the only purpose of it is to place that policing under the ICC's jurisdiction.

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