of the Corporation will reveal that shippers need not be located on any river in order to enjoy the benefits of inland-waterway transportation, meaning port-to-port, because the Corporation not only publishes all-barge rates, but it also participates in barge-rail, rail-barge, and rail-barge-rail rates.

Our main interest in the further development and continuance of the Corporation's services is that related to freight rates, differentials, services, and schedules. These benefits are not matched by privately owned barge operators. If they were, we would not be appearing in behalf of legislation in the interests of this Corporation. Because of these benefits, the port of New Orleans has gained thousands of customer-shippers situated throughout the midcontinent, and who have depended on these services down through the years. The port has the responsibility to its patrons, as well as to itself, to have maintained all of these benefits. It has played no small part in stimulating the growth and the prosperity of the midcontinent.

In the organic law of the Corporation it was never intended or contemplated that the lines operated by the Corporation be dissolved or abandoned. On the contrary, it was intended that the lines be sold or leased with satisfactory assurance of "continuing common-carrier service in a manner substantially similar to the service rendered by the Corporation." This means service to all shippers, large or small, bargeload, carload, or less-than-carload. Recognizing that industry locates and expands in certain areas because of variety of transportation advantages and facilities, many of such "locations" have taken place in the Mississippi Valley, on the river, and away from the river, due to the existing economy-rate structure; not the specific rate, but due to the well-founded and well-recognized transportation competitive set-up between land and water transportation. Therefore, any industry investor, aware of this law, could always feel that the Congress had given assurance of the continuation of an inland-waterway transportation service, and thereby could depend upon differential rates to move his product. We cannot dismiss these assurances lightly; they are obligations which can be discharged only by the Congress, and the best way in which this could be done would be in the passing of Senate bill S. 211, and the amendment thereto.

It is important that the Corporation's equipment and facilities be rehabilitated and modernized so that it can continue to serve the carload and less-than-carload shipper, and so that the line which it operates can demonstrate to private investors its ability to handle profitably this character of commerce, to the end that when this is done there will be a desire on the part of private investors to purchase and operate the line on a regular common-carrier basis.

The port of New Orleans, together with its civic and trade agencies, has launched a program devoted to the development of world trade, peace, and understanding. It has launched a program of developing import business so that dollars will reach traders in other countries which in turn will come back to the manufacturer and the farmer, thus enabling them to market their products throughout the world.

Certainly the operation and continuation of common-carrier barge service throughout the midcontinent area is important for the economic movement of this commerce being developed under the port's program. That is why it is important that the legislation before your honorable committee should receive favorable consideration.

I might add, Mr. Chairman, and members, in conclusion, that I have been associated with the transportation business for many years, and I do not know of any time since the inception of the Federal Barge Lines than at the present time as being the most important for the continuation of the Federal Barge Line on a modernized scale so as to afford to the shippers and the receivers of the Mississippi Valley the character of service that was intended by the passage of the act.

Senator MYERS. Any questions? Thank you ever so much, Mr. Olsen; we appreciate your coming in and giving us this information. Mr. OLSEN. Thank you.

Senator MYERS. Mr. George Whitney.

STATEMENT OF GEORGE WHITNEY, PRESIDENT, YOUNG MEN'S BUSINESS CLUB OF NEW ORLEANS, LA.

Mr. WHITNEY. Mr. Chairman and members of the committee, due to the shortness of time, I would like to submit this brief made by Mr. Lewis I. Bourgeois, chairman of the Federal Barge Lines committee of the Young Men's Business Club of New Orleans. Mr. Bourgeois happens to be on a trade mission in Mexico, and is unable to return in time for this meeting.

Senator MYERS. We appreciate that, Mr. Whitney, and you can be assured that the entire statement will be printed in the record at this point.

Mr. WHITNEY. Thank you, sir.

(The document referred to follows:)

STATEMENT OF LEWIS I. BOURGEOIS, CHAIRMAN OF THE FEDERAL BARGE LINES COMMITTEE OF THE YOUNG MEN'S BUSINESS CLUB OF NEW ORLEANS, LA.

Mr. Chairman and members of the Committee of the Senate on Interstate and Foreign Commerce, the Young Men's Business Club of New Orleans, a civic organization composed of over 3,000 business and professional men residing in the Greater New Orleans area, hundreds of whom are small shippers, or who are connected with domestic and world trade, desires to present this statement to this committee:

We favor continuation of the Federal Barge Lines (Inland Waterways Corporation) under public ownership until such time as private capital will find it advantageous and feasible to buy and operate it, and provided that when this takes place the private owner will continue to handle traffic under rates applying for carload, less than carload, and less than bargeload, to the same extent as is generally existent over these lines at this time; further, that the private owner will be required to continue, as a minimum, substantially the present differential rate coverage, both as to territory and commodities; and that such private owner will be required to furnish the same service as was normally furnished by these lines before World War II, a service curtailed today because of worn-out equipment, shortage of barges, and lack of sufficient modern towboats.

Having examined the provisions of S. 211, and the amendment proposed by Senator Wherry, and mindful of the position which our organization took toward the continuation of regular common-carrier barge service, as stated hereinbefore, we wish to record before this committee our support for this legislation, feeling that this is to the best interests of the people of the Mississippi Valley and to the commerce of the city of New Orleans and all of its related interests.

It is our belief that, with the passage of this legislation, the Federal Barge Lines will be rehabilitated; its equipment will be modernized; its services will be improved, and the shippers of the midcontinent will receive the service they are entitled to, under the organic law creating the Inland Waterways Corporation.

We further feel that, when these things have been done, the Federal Barge Lines, as a going concern, can be sold to private owners, who will then have no hesitancy to purchase and give assurance of continuation of common-carrier service on the Mississippi River and its tributaries.

Senator MYERS. Mr. William L. Stevenson, Marine Engineers Beneficial Association of St. Louis.

Mr. SCHWARTZ. Mr. Chairman, may I interrupt for just a moment in order to complete the Louisiana presentation. May I suggest, if you would be so kind as to do so, that you hear Mr. Doss Berry of Baton Rouge next, who will possibly just concur in my statement, and in that way you will finish with the Louisiana presentation.

Senator MYERS. We will be very happy to hear Mr. Doss H. Berry, general manager of the Baton Rouge Traffic Bureau.

STATEMENT OF DOSS H. BERRY, GENERAL MANAGER, BATON ROUGE TRAFFIC BUREAU

Mr. BERRY. My name is Doss H. Berry, and I am general manager of the Baton Rouge Traffic Bureau.

The Baton Rouge Traffic Bureau is an organization having in its membership the city of Baton Rouge, the chamber of commerce, port authority, and some 60 of the leading industrial and business firms. It is a nonprofit organization.

The city of Baton Rouge has a substantial amount invested in the port and in warehouses and other facilities. The port was constructed there strictly as a barge-line port; not for deep-sea vessels.

At the present time, the only barge line that serves Baton Rouge in less-than-bargeload traffic is the Federal Barge Lines.

Just recently, on account of the equipment, the Federal Barge Lines placed a temporary embargo against Baton Rouge. Another one of the carriers placed an embargo which they have never lifted.

At that time, the people, the different industries there, were really and truly seriously injured in many ways. The different concerns that had been receiving their shipments by barge and had been doing business on the barge-line rates were forced to go to much higher transportation costs.

Now, they have just recently created what they call the Port Authority of Baton Rouge. They have also reorganized the Baton Rouge Traffic Bureau. They have put these two down there together, and for the past month the business that has been picked up where they had had no business during previous time at all, during this embargo, is absolutely unbelievable, that is, the amount of business that has been regained.

Now, the rice business over around Crowley, La.; and in that vicinity absolutely depend on the barge-line rates; that is, the carload rates and service for their rice. We even get flour that comes from as far as Salina, Kans., to Baton Rouge, La., there; and, if this bargeline service should be discontinued, our port and all of the facilities and everything would be absolutely worthless overnight. It would be just worthless.

Senator REED. Unless the other barge lines handled that kind of business.

Mr. BERRY. Yes, sir; but we have another barge line that had been serving there; that has an embargo against handling the less-thanbargeload traffic now. I do not know whether it would be-it is set for hearing the 7th of June, and I do not know whether you could make them do it or not.

Senator REED. Well, if it is a common carrier, you can.

Mr. BERRY. It is Mr. Schwartz' case, and I think, the way he talked this morning, his feet were getting a little bit cold on it.

to

I do not want to take up any more of your time so I am just going say that I listened to Mr. Schwartz's testimony and to his answers, and I absolutely concur 100 percent in the testimony and the answers that he gave.

I certainly thank you.

Senator LONG. Might I ask you just one question in connection with that?

Mr. BERRY. Yes.

Senator LONG. Now, actually, all of the traffic moving in and out of Baton Rouge is petroleum products?

Mr. BERRY. Yes.

Senator LONG. That is, moving from the Standard Oil plant there? Mr. BERRY. Yes.

Senator LONG. They have their own carriers there; they can either haul it themselves or else contract it out? They have plenty of equipment?

Mr. BERRY. That is right.

Senator LONG. Of course, du Pont has some industry there, and also the Kaiser industries with that aluminum plant?

Mr. BERRY. Yes, sir.

Senator LONG. Do you know if any of the other plants there would have the benefit of water transportation, aside from that group of major corporations, if this barge line is discontinued?

Mr. BERRY. They absolutely would not have that, and just as an illustration, the other day, Senator, there was one firm who had a little 9,000-pound shipment, that is, a less-than-carload shipment. These people, on account of losing the barge-line service, were so confused that they had shipped it over a forwarding company, and they were overcharged $125 on one little 9,000-pound shipment.

Senator LONG. Well, there are probably quite a few small businesses in that area; and, if they would have to take that beating every time a traffic shipment comes in, they would have probably have to go out of business. Is that not so?

Mr. BERRY. Sure. The business in Baton Rouge and in that vicinity has been established there, based upon water transportation; and, if you should take this water transportation away from them, I do not know what would become of them. They would not be able to compete with the others.

Senator LONG. Would a large corporation get by there, because they would have their own facilities? They would get by; would they not? Mr. BERRY. Surely.

Senator LONG. They could continue to ship by water, but all these other little merchants would otherwise have to sink or swim, and a lot of them would have to sink.

Mr. BERRY. Yes, a lot of them would have to sink.

Senator MYERS. Does that dispose of the witness from New Orleans and other Louisiana cities?

Senator MYERS. Well, it is almost 12:30, and if we are going to meet this afternoon we will not have too much time. Is he here?

Mr. SCHWARTZ. He was here a moment ago.

Senator MYERS. At this point in the record, I would like to have inserted a telegram to Senator Stennis from the mayor and aldermen of the city of Vicksburg.

(The telegram referred to is as follows:)

Senator JOHN C. STENNIS,

Senate Office Building, Washington, D. C.:

VICKSBURG, MISS., May 14, 1949.

Re S. 211. The people of the city of Vicksburg concur in the resolution on the Federal Barge Lines recently passed at the annual convention of the Delta Council at Cleveland, Miss., May 5.

This organization as known to you represents the commercial interest of the people along and adjacent to the Mississippi River from the Tennessee line to the city of Vicksburg. That resolution testifies to the need of adequate integrated water transportation for the proper development of the Mississippi Valley.

The Inland Waterways Corporation has rendered a fine service in developing traffic on the inland waterways, particularly on the Mississippi River which flows by Vicksburg. It has served to extend the traditional rate-restraining influence of the Mississippi River to areas scores of miles from the main river. It is the only carrier that will handle freight in less-than-carload lots. This protects the interests of the small shipper. For a hundred years Vicksburg has been a stratègie point on the Mississippi River, and no city on this river is in a better position to know what river transportation means to the business and industry of the section which the great river serves. The present and future commercial development of Vicksburg and trade area extending for a radius of over a hundred miles is largely dependent upon the continued operation of the inland waterways system. In order for this organization to be efficient and to properly serve the needs of the Mississippi Valley, appropriation provided for under S. 211 is absolutely essential. We urge that you use every means at your command to effectuate the passage of this legislation. MAYOR AND ALDERMEN OF THE CITY OF VICKSBURG. E. W. HAINING.

Senator MYERS. I think, then, gentlemen, we had better recess until 2 o'clock this afternoon, and I am sure we will get permission to sit this afternoon.

(Whereupon, at 12: 25 p. m., a recess was taken until 2 p. m., of the same day.)

AFTERNOON SESSION

Senator MYERS. The committee will come to order. I believe we have the last witness of the New Orleans group yet to be heard. Therefore, I will ask Mr. Joseph Henderson to come to the witness stand.

Do you have a prepared statement, Mr. Henderson?
Mr. HENDERSON. Yes, sir.

STATEMENT OF J. D. HENDERSON, NATIONAL MANAGING DIREC TOR, AMERICAN ASSOCIATION OF SMALL BUSINESS

Mr. HENDERSON. My name is Joseph D. Henderson. I am national managing director of the American Association of Small Business. Many of our members are engaged in building, repairing, operating barges, and towing vessels. Others are interested in barge transportation from the viewpoint of shipping and receiving freight.

At this point I respectfully refer the gentlemen of this committee to my testimony as recorded in the Federal Barge Lines hearings