December 7, 1970
Page 40024
THE INTERSTATE COMMERCE COMMISSION AND THE RAILROAD
Mr. MANSFIELD: Mr. President, Senators may recall that in the past year I have become increasingly concerned about the attitude of the Interstate Commerce Commission and its ineffectiveness in protecting the interests of the shippers, the consumers and the traveling public.
In my estimation, the Interstate Commerce Commission has almost given in to the industry and. has done little to help formulate an improved transportation system. As a Senator from the State of Montana, I am primarily concerned about the effect that this situation is having on my constituents. There is every indication that there will be further reductions in passenger train service in Montana. The Burlington-Northern has reduced service to more of the small communities in my State with the acquiescence of the Commission. It has only been a few days since the Commission agreed to permit the Burlington-Northern to discontinue its service between Sappington and Norris, a matter which our State regulatory agency, the Montana Board of Railroad Commissioners, intends to appeal.
The three freight rate increases approved this year by the Commission have placed the agriculture and lumber segments of my State’s economy and, I believe, the Nation’s economy in a very precarious position.
In all fairness to the Interstate Commerce Commission, I will say that the boxcar shortage in Montana is less serious than it has been in the past, but it has taken considerable time to convince the Commission of the seriousness of this matter so that they would take the necessary initiative through their own personnel and regulations. I am including a copy of a report I have just received which gives the Commission’s position on this area in considerable detail.
Until such time as the members of the Interstate Commerce Commission will take the time to assume the independent role of the Commission and, in effect, lecture and suggest to the transportation industry how their services and management might be improved to meet the demands of this country in the early 1970s, I believe that the Commission has little value. I am not the only Member of this body who has expressed concern. I have been joined by 30 of my colleagues in expressing our reservations to the Chairman of the Commission. This is indicative of what I feel will be one of the major issues to be discussed in the 92d Congress – the future of the Interstate Commerce Commission and other regulatory agencies.
Mr. President, I ask unanimous consent that the text of the joint communication to the Chairman be printed at this point in my remarks. I also ask unanimous consent to have a recent news story appearing in the Independent Record, Helena, Mont., daily newspaper, printed in the RECORD, which indicates in more detail the effect and scope of the recent approval of freight rate increases. Freight rate increases over the past 12 months will cost the grain industry in Montana some $7.5 million a year.
There being no objection, the material was ordered to be printed in the RECORD, as follows:
INTERSTATE COMMERCE COMMISSION,
Washington, D.C.,
November 27, 1970.
Hon. MIKE MANSFIELD,
Majority Leader,
U.S. Senate,
Washington, D.C.
DEAR SENATOR MANSFIELD: This is in reply to your telegram of November 18, 1970, addressed to Chairman George M. Stafford, with reference to the effective date of the eight percent freight rate increase.
I am particularly interested in that part of your telegram wherein you state that the railroads are not furnishing enough grain cars prior to the effective date of the increase. Due to my close association with the total car supply of all the railroads and the responsibility for same delegated to me by the Commission, I have been requested by Chairman Stafford to reply to that portion of your telegram.
We have practically completed the movement of the recent grain harvest in the western and Midwestern states, including Montana. I am happy to report that this year we have had very few complaints from shippers unable to obtain cars to transport. their grain. Presently the bulk of Montana grain is being loaded on the lines of the former Great Northern Railway in the area bounded by Great Falls on the south, Shelby on the northwest, and Havre on the northeast. The other lines of the Burlington Northern and the Milwaukee railroads have made only minor demands for grain cars at this time.
I am quoting below statistics for the Billings region of the Burlington Northern, which takes care of practically the entire State of Montana, for November 18, 19, 20, and 23.
The car supply of the Burlington Northern today is such that it is able to fill all orders for boxcars. The information obtained from our field personnel indicates that hundreds of cars of grain are being held at hold points in Montana and Washington awaiting billing instructions from the shippers. In fact, the flow of grain for Montana and contiguous states has been so heavy that it will probably be necessary to embargo the largest elevator complex in the Pacific Northwest because of its inability to handle cars currently. This facility on November 19 had nearly 500 cars of grain, largely from Montana, on hand for unloading.
On the Milwaukee Railroad there are no shortages of cars for grain loading at this time. The Union Pacific, the other Class I railroad operating in Montana, has no grain traffic originating in that state at this time. On Friday, November 20, the Milwaukee Railroad requested that the Commission discontinue its assistance in furnishing it with boxcars because of substantial reductions in the demand for boxcars from shippers on its lines. We received a similar request from the Burlington Northern on November 23.
It is pointed out that, as indicated in the above tabulations, there remain substantial shortages of covered hopper cars. This is true wherever grain is being shipped today. Shippers desire covered hoppers because of their economy in loading and unloading. There is no rate difference in the use of covered hopper cars over boxcars, but, as you are aware, the covered hopper is a specialized car, very desirable for grain shippers. The demand for covered hoppers has far exceeded the carriers’ ability to furnish them. However, all grain carrying roads have been making a vigorous effort to augment their covered hopper fleets.
From the above information I am sure you will recognize that while the railroads are not furnishing sufficient covered hopper cars to meet the demands of shippers served by them, it is quite evident that they are furnishing sufficient equipment to transport the grain being offered.
As previously stated, we in the Commission feel that the efforts of our Washington staff, along with the close checking of our agents in the field, have resulted in much-improved service and a minimum of complaints. We have monitored the car demands consonant with the grain movements and have amended and modified our orders to effect the greatest utilization of equipment and to have the greatest number of cars available where they are needed.
We have endeavored to perform a service to all; and where our efforts would best be served by focusing our attention on seasonal movements, we have done this. I can say without reservations that most grain shippers will agree that the carriers have met the demands made upon them in a reasonable manner. To support this, I am enclosing copies of correspondence which I believe indicate the results of our handling of car supply and service complaints. While I am somewhat hesitant to expound on the work accomplished by our Commission, I do believe in all fairness that you should be given the benefit of the enclosed.
While I have dealt primarily with present conditions in Montana, I do believe that a similar situation has prevailed for quite some time; and while the farmers elevators might be, in a position to produce contrary statistics, we feel that a general statement to the effect that railroads were not furnishing grain cars prior to that date is a debatable question.
In any event, I am happy to bring you up to date on the present picture.
Sincerely yours,
RUPERT L. MURPHY,
Commissioner.
OFFICE OF THE MAJORITY LEADER,
Washington„ D.C.,
November 30, 1970.
Hon. GEORGE M. STAFFORD,
Chairman,
Interstate Commerce Commission,
Washington, D.C.
DEAR MR. STAFFORD: The gravity of the present surface transportation situation in the United States cannot be overstated. It is past time for the Interstate Commerce Commission to review its decisions with respect to transportation matters under its jurisdiction and to assess its position. We ask that you consider the long list of decisions which have reduced service, increased costs and permitted the draining of assets so seriously as to imperil the future of rail transportation in the United States.
Two once great railroads, after merger, are bankrupt; another newly merged giant is short of cash; passenger trains have been discontinued, one after the other; in little more than three years, there have been freight rate increases totaling 30 percent, with another increment of 7 percent threatened. Only lately and only partially has the ICC demonstrated its concern with carrier diversification and the consequences of it for rail service. In addition, the box-car shortages on the western lines are not sporadic anymore; it appears to he a permanent liability.
It would be curious, indeed, if the agency that was established to regulate surface transportation were to be the instrument for the collapse of a vital sector of that industry. The most recent order to permit an 8 percent increase of rail freight rates suggests to us that, despite clear warnings, the Commission remains unaware that to all appearances it has ceased to be a regulatory agency.
Indications at this time lead us to believe that merger considerations, diversifications and increasing labor demands may well result in a transportation crisis of unprecedented magnitude within the next two years. The related effect of this crisis is presently measurable in its effects upon both the rural and urban economic base, regionally and nationally.
Repeated Congressional expressions of concern, not only for rail transportation but for other facets of the economy dependent upon rails, have gone virtually unheeded by the Interstate Commerce Commission.
A review of hearings before the Senate Subcommittee on Surface Transportation clearly indicates by the Commission’s own figures that the railroads have been given "substantially everything they have asked for." The Commission’s granting of rail requests has had virtually no effect on the decline of rail service.
The Nation is falling into a transportation morass from which certain segments of the economy may never recover. The time has come for a facing of the realities of this situation and for the concerted action necessary to reverse the present course of events.
Sincerely yours,
Senator Mike Mansfield, Senator Lee Metcalf, Senator Stuart Symington, Senator John Sparkman, Senator Len B. Jordan, Senator Jennings Randolph, Senator Clinton P. Anderson, Senator George D. Aiken, Senator Stephen M. Young, Senator Quentin N. Burdick, Senator Harold E. Hughes, Senator Abraham Ribicoff.
Senator, William Proxmire, Senator Albert Gore, Senator Clifford P. Hansen, Senator Frank Church, Senator Alan Bible, Senator Edward J. Gurney, Senator B. Everett Jordan, Senator Strom Thurmond, Senator Birch Bayh, Senator John Sherman Cooper.
Senator Thomas F. Eagleton, Senator Howard W. Cannon, Senator Barry Goldwater, Senator Mike Gravel, Senator Edward M. Kennedy, Senator Gay`lord Nelson, -Senator Spessard L. Holland, Senator Gale W. McGee, Senator Edmund S. Muskie.