The CHAIRMAN. That will terminate the testimony of Mr. Gossett, and we want to thank you both; that is you, Dr. Yntema, and Mr. Gossett, for your patience. It has been a bit trying, but in an endeavor to get out all the facts sometimes we may get a little intemperate. I am sure that there is no intention on either side to be hurtful to anyone, and I think you will agree with that. Mr. GOSSETT. We certainly will, sir. We are very grateful for your patience. The CHAIRMAN. Thank you very much, and we appreciate your coming here and giving us this valuable assistance. Mr. GOSSETT. You did make one mistake, Mr. Chairman. You said we are trying to delay this legislation. We are not trying to delay it, we are trying to beat it. The CHAIRMAN. It is a good fight. You have the right to correct the testimony, and if you wish to submit any additional data and statements, you are free to do so. Mr. GOSSETT. Thank you very much. Mr. YNTEMA. Thank you, Mr. Chairman. (The prepared statement of Mr. Gossett is as follows:) FOR RELEASE AFTER 10:00 A.M., B.D.T., WEDNESDAY, JUNE 28, 1961 STATEMENT BY WILLIAM T. GOSSETT VICE PRESIDENT AND GENERAL COUNSEL before the Antitrust Subcommittee of the Committee on the Judiciary United States House of Representatives on H.R. 71 introduced by Representative Emanuel Celler, of New York Washington, D. C., Wednesday, June 28, 1961 STATEMENT BY WILLIAM T. GOSSETT My name is William T. Gossett.. I am Vice President and General Counsel of Ford Motor Company. My statement is devoted to some fundamental legal questions presented by H.R. 71. If the bill were enacted, it would be a violation per se of the antitrust laws for a motor vehicle manufacturer to finance or insure the sale of its products; and as to manufacturers now in such businesses the bill presumably would make mandatory the drastic remedy of divestiture, regardless of the circumstances. The legislation would apply only to the manufacturers of motor vehicles; it would not affect others. The prohibition would be absolute; it would apply regardless of the size of the manufacturer or the need for its services in financing and insuring its sales. The effect of the legislation would be to grant to the unaffiliated finance and insurance companies a specially legislated sanctuary, free from competition by the manufacturers. Not only would the legislation be discriminatory; it would destroy arbitrarily a right of the motor vehicle manufacturer as fundamental as its right to manufacture carburetors, spark plugs or any other product component. Manifestly, such drastic action should not be taken except in the most extreme circumstances and then only after a hearing with full opportunity for presentation of all relevant factual material, with the right of cross examination and the right to judicial review. The Bill is Anti-antitrust Legislation The bill contains no findings to justify its summary interdictions; and the only stated purpose of the bill is "To supplement the antitrust laws of the United States against restraint of trade or commerce by preventing manufacturers of motor vehicles from financing and insuring the sales of their products." But the bill would not eliminate restraint of trade; on the contrary, it would impose novel and unprecedented restraints of its own. Far from being an appropriate supplement to the antitrust laws, the proposed legislation would be anti-antitrust in effect. Indeed, as we shall show, it would be in direct conflict with the basic purposes and philosophy of the antitrust laws. For more than 70 years, it has been the policy of this nation to promote a free economy and to protect the consumer by preserving open competition among the sellers of goods and services. In the language of Mr. Justice Black: "The Sherman Act was designed to be a comprehensive Thus our faith is in the efficacy of competition. The 1955 Report of the Attorney General's National Committee to Study the Antitrust Laws opened with this statement: "The general objective of the antitrust laws is The mere possibility that new competitors may enter an industry exerts a beneficial, restraining influence on prices. Exclusion of competitors is a contradiction of these fundamental principles.2/ Yet H.R. 71 would exclude from an important field of commerce an entire class of legitimate competitors. It would confer upon the unaffiliated finance and insurance companies, as a class, a monopoly position, free from even the possibility of competition from the manufacturers. What justification, legal, ethical or economic, is advanced for this startling legislative innovation? What reasons are given for the proposal to bar one class of competitors from the market and confer a competition-free monopoly on another? The Asserted Justifications for the Legislation The proponents of H.R. 71 (principally the American Finance Conference, an association of unaffiliated finance companies) have suggested three bases for the legislation: First, it is said there is undue concentration in the motor vehicle industry, that would be difficult to cure by litigation under the present antitrust laws. 1/ See Bain, Barriers to New Competition (1956); Edwards, Maintaining Competition 186-248 (1949); Stocking & Watkins, Cartels or Competition? 136-38 (1948). 2/ See Lorain Journal Co. v. United States, 342 U.S. 143 (1951); American Tobacco Co. v. United States, 328 U.S. 781 (1946). |