Mr. REECE. Do you feel that it is not fair, looking at it from the viewpoint of railroad workers, that the railroads should be deprived of traffic which they can transport as economically and with greater convenience to the producers, than any other transportation agency, and thereby deprive the men who are employed by the railroads of employment to that extent and encourage the establishment of new transportation agencies or the further development of new transportation agencies to handle this traffic that is diverted from the railroads, and to build up a new personnel to handle it with those agencies? Mr. HARRISON. That is precisely it, Mr. Congressman. I think there is a great social loss involved in our past policy. Here we have, as I said, a most efficient and adequate railroad transportation system. We have about $26,000,000,000 invested in that transportation system, but through restrictions placed by Congress in the Interstate Commerce Act we make it impossible to utilize that plant and personnel to carry on the very service for which the plant was created and thereby encourage the investment of other capital in other forms of transportation service, so that the net result is, when we get through with that policy, we have far more capital invested in the furnishing of transportation services in the country than is necessary, and, after all, the obligation to support those investments must in the final analysis be reflected in the cost of the commodities that the public consumes and there is an economic waste there that, in my opinion, is unjustified and unwise, and then particularly as it affects railroad employees, they have invested their lives in the railroad transportation industry. And here we find competitors who have sprung up without any semblance of Federal regulation are going out and unfairly competing with us in taking our jobs away from us, and we are absolutely helpless all because of an artificial barrier which has been erected by the Government on some theory in the days gone by, when we did not have this competitive situation. We genuinely and sincerely feel that we are not receiving at the hands of the Government that degree of consideration and fair treatment that we have a right to expect and we think it can be remedied by modification of section 4 as the railways of the country have requested that it be modified. Mr. PETTENGILL. Mr. Harrison, it was pointed out this morning that the investment in the transcontinental lines is 40 times the investment in the shipping that goes through the Panama Canal to the west coast. So that, in following out your theory of a social loss, you are diverting from $40 investment, together with the men employed, to serve the investments of $1. Mr. HARRISON. I think that is unfair. I do not know anything about the ratio of investment in water transportation facilities and similar railroad or transportation facilities, but it does not seem like it represents an intelligent approach to a national transportation problem, to permit a condition to continue as has brought about the chaotic conditions that exist today, and I think you have an opportunity of remedying that now by modifying section 4 as is con templated by H. R. 3263 now before this committee. That is the Pettengill bill, is it not? Mr. PETTENGILL. Yes. Mr. HARRISON. That is the bill we are supporting, and we are in agreement with the railroads on that, so you have the situation today before your committee, where you have all of the railways of the country-that is, the management of the railways of the country-asking for some relief and here you have the representatives of over 1,000,000 railway employees who are asking for that same relief. We are in agreement with the railroads on this question. We are glad to appear here to assist in bringing about that reform, not particularly because we want to do something to help the railroad management, although that is a laudable purpose, but we also have the interest of trying to do something to help the employees who are looking forward to an opportunity to get back into productive and gainful employment, and that will not be possible unless they can come back into the transportation industry. Now, that concludes my general statement, Mr. Chairman, and there are several other witnesses here in behalf of labor who will deal with the different aspects of this problem, and then I understand there is one other representative of labor who would like to appear a little later on in the week. He is unable to get here until Thursday. I hope the committee will find it possible to hear him. Mr. PETTENGILL. All right, we thank you very much. Mr. HARRISON. Thank you, gentlemen. Mr. MARTIN. I would be glad to have Mr. Harrison insert in the record any statistics which he has here which he thinks will help us. Mr. PETTENGILL. Yes; they may be inserted. (The matter referred to is as follows:) Traffic units per employee, per hour of service, and per dollar of compensation, 1920-34, class I carriers in the United States Source: Traffic units estimated by adding revenue freight ton-miles plus 3 times passenger miles. Basic data from reports to the L. C. C. Operating revenue per employee, per hour of service, and per dollar of com- Investment and gross operating revenue net book value and total stock and 1 Source of information: Statements 42 and 43 Annual Volumes Statistics of Railways. 2 Source of information: 1920 to 1930, Recapitulation p. S-24 Statistics of Railways, 1930; 1931 to 1933, Capital invested per dollar of railway operating revenue and dividend and [Based on reports to the Interstate Commerce Commission] Total number of employees, total number of hours worked, and total compensa- [As reported to the Interstate Commerce Commission] STATEMENT OF HARRY SEE, SAN FRANCISCO, CALIF., REPRE- Mr. PETTENGILL. We will hear Mr. See. Mr. SEE. Mr. Chairman and gentlemen of the committee: My name 635-35-20 as explained by Mr. Harrison, has taken action at various times favoring the amendment or repeal of the long- and short-haul clause. About 2 years ago several Western representatives of railroad labor organizations met and discussed this matter. Later on we contacted representatives of certain of the Western railroad carriers with the idea of asking their cooperation in securing the enactment of a bill to repeal or amend the fourth section. As a result of those informal conferences, a meeting was held in Salt Lake City in November 1933 which was attended by representatives of 9 of the standard railroad labor organizations from the 11 Pacific coast and intermountain States, and representatives of quite a large number of the western carriers. At that meeting, plans were worked out to set up committees in the various States consisting of representatives of the brotherhoods and of the carriers. Our purpose in setting up these committees was to crystallize sentiment within our own ranks and to give us a medium for expressing ourselves in this matter, especially to businessmen, farmers, and their organizations to whom the issue had become clouded by the misrepresentations of one or two rate organizations which, over a period of years, have virtually lived on blocking our efforts to secure modification of the fourth section. The strict enforcement of the fourth section of the Interstate Commerce Act has been responsible during the last 20 years for the unemployment of thousands of members of the Standard Railroad Labor organizations. Mr. MARTIN. Before you go ahead, Mr. See: You spoke of the interests and of the organizations which you say have opposed the change in fourth section. Did I understand you to refer there to some organizations that have opposed it? Mr. SEE. I did; yes, sir; I said that there were some rate organizations that we felt had misrepresented the situation to business men, and farmers, and others. Mr. MARTIN. Would you care to indicate who are or what they are? Mr. SEE. I would not care to. They are rate associations in the intermountain territory, and some on the Pacific coast. Mr. Harrison has already told you just how serious this condition is. He stated that 10 percent of all unemployed workers in these United States are unemployed railroad men, and it is quite within the bounds of reason to anticipate that modification of the fourth section of the Interstate Commerce Act as contemplated in House of Representatives bill 3263 will very quickly reestablish employment for not less than 10 percent, or 100,000 railroad workers who are now without prospect of employment. As a matter of fact, we have reason to hope that the ultimate result of modification of the fourth section as now contemplated would put back to work 150,000 railroad men, a number almost equivalent to the total of men now employed by the intercoastal steamship lines. I understand that railroad representatives have already testified to the fact that strict enforcement of the fourth section has resulted in the diversion of a very substantial proportion of all transcontinental tonnage from the railroads to the Panama Canal route of the intercoastal steamship lines. In fact, these steamship companies |