tion to traffic. Mr. Blood is correct in that we promptly ordered him to cease this practice.

I have already testified that the railroad does not threaten leaseholders with cancellation if leaseholder fails to ship all his freight via the Alaska Railroad. To clarify the record, the Alaska Railroad does not permit assignment or subleasing of ground obtained from the railroad.

With reference to Mr. Blood's last paragraph regarding reefer cars, I can only say that Mr. Blood has not asked us about reefer cars. He has asked our Mr. Buckley about special freezer van service at special rates not presently published. These special rates and special service were refused Mr. Blood, inasmuch as there was available regular cool room and refrigeration service Fairbanks to clear at published rates.

Respectfully,

Senator BARTLETT. Mr. Carr?

please?

Mr. CARR. Thank you, Senator.

R. H. ANDERSON, General Manager.

May we have the next witness,

STATEMENT OF JESSE L. CARR, SECRETARY-TREASURER, LOCAL 959, TEAMSTERS UNION, ANCHORAGE, ALASKA

My name is Jesse L. Carr and my address is Post Office Box 2092, Anchorage, Alaska. I am the secretary-treasurer of Local 959, Teamsters Union, which covers all of Alaska except Kodiak. There is substantial agreement between the motor carrier operators and the Teamsters Union on the necessity of the regulation of the Alaska Railroad as provided in Senate bill 1508.

Our union has long been in favor of the regulation of the railroad and our representatives have many times testified in favor of the mentioned bill.

We testified in the hearings held in Alaska in 1955; in Alaska in 1957; in Washington, D.C. in 1958. This matter of regulation has been considered by the Congress for approximately 4 years and the situation of the trucking industry has been seriously deteriorating during that period. We are concerned because the unfair competition has, in our opinion, destroyed the businesses of many motor carriers. The obvious consequences are, there is less employment opportunity for our members.

In addition, the labor movement is generally in favor of regulation of carriers because of the requirements in the acts relating to safety conditions and other working conditions. I refer particularly to the extension of certain previously passed congressional acts to the railroad as shown on page 3 of Senate bill 1508.

Our union has labor agreements with the various motor carriers. We find it extremely difficult to negotiate those agreements because of the competitive position enjoyed by the railroad. The wages paid by the railroad are less than those paid by the private carriers. Railroad representatives have testified that the charge that the railroad pays less than motor carriers for wages is "fantastic."

The railroad representative, Mr. Edwin N. Fitch, in his testimony before the House committee, set out the wages of various classes of employees. A comparison between those and the wages paid by private carriers is as follows:

The Alaska Railroad rate for "semi" drivers is $3.47 per hour; for the private carriers in the Anchorage area it is $3.885 per hour.

For the single truckdriver and delivery man, that paid by the Alaska Railroad is $3.407 per hour; private carriers pay $3.785 per hour, in the Anchorage area.

Swampers and warehousemen, by the Alaska Railroad are paid $3.28 per hour; the private carriers in the Anchorage area are paying $3.685 per hour.

The above scale for private carriers is for the Anchorage area, and in the Fairbanks area, the employees receive 10 cents more per hour than that shown above.

In addition to the above hourly rates the private carriers pay $17.30 per month per person to the health and welfare plan and 10 cents per hour per person to the pension plan. The fringe benefits on vacations, compensation coverage, and various other fringe benefits, as between the railroad and private industry, are quite similar. It should be obvious that the railroad pays approximately 60 cents per hour less than private industry. This allows the railroad an unfair competitive advantage over the motor carriers. I recognize that this situation will not be resolved by the passage of S. 1508, but suggest that the competitive position of the motor carriers will be improved because regulation will result in a healthier transportation industry. On Senate bill 1509:

We are and have long been in accord with the provisions of Senate bill 1509 which provides grandfather rights to motor carriers operating in Alaska.

The carriers will be relieved of the long hearings necessary to obtain certificates of public convenience and necessity. It seems elementary to us that those men who came to Alaska, invested their funds, established their businesses, fought intolerable conditions, and pioneered the trucking industry in Alaska should receive some consideration from the Congress.

We are also in accord with Senate bill 2452 which provides for the establishing of a joint board and the filing of through routes and joint rates for various carriers.

There appears a good possibility that the transportation of many commodities to Alaska in the next 10 years will be on the basis of containers shipped to Alaska via air, and then carried through Alaska by motor carriers.

In conclusion, let me say that the national policy on transportation for many years has been that the competing forms of transportation are encouraged to thrive. There should be a place for all of the various forms of transportation.

If the trucking industry in Alaska continues to be regulated, which is inevitable, the railroad industry must also be regulated. We cannot continue to play in the same game with different sets of rules. The only manner in which freight rates will go way up is to create a monopoly in the Government-owned railroad. If it destroys the truckers, it will destroy the jobs of our people.

A second point is that a healthy transportation industry is essential to the development of Alaska. The railroad does not serve all points in Alaska, but, because of the histories of-because of history the bulk of the people are in the railbelt area. If the trucking industry is

to survive, it must be able to compete where the people are presently located.

If Congress will regulate the railroad, it will save the trucking industry and will give it an opportunity to do its share in developing the State of Alaska.

Thank you very much, gentlemen, for your consideration.

Senator BARTLETT. Mr. Carr, I have only one question and that is this: If the Alaska Railroad is placed under the ICC in respect to economic regulation, do you believe there is a probability or a considerable possibility that a general rate increase would be imposed, thus adding to the already high cost of living in the railroad belt? Mr. CARR. I certainly do not, Senator.

Senator BARTLETT. Would you give us your reasons for that statement, Mr. Carr?

Mr. CARR. I believe that if the truckers are put under a regulatory system, and the railroad is, that actually, in effect, it will force the freight rates down, because they can compete on a fair basis.

Now, as far as the Alaska Railroad is concerned, I am not here to argue their rate structure, but I've seen so many discrepancies in their mode of operation.

Now, if I might deviate for just one moment?

Senator BARTLETT. Surely.

Mr. CARR. I have many times in my capacity as secretary-treasurer been down in the freight yards-and I've seen flatrack trucks-this will probably be hard to believe with a driver, two fellows in the front seat, and two in the back, and maybe a 2-ton load.

Now, I think that if the truckers and the Alaska Railroad are put under ICC regulations, they'll all have a fair compettive system, and it will force the freight rates down instead of up. If you have the Alaska Railroad-if they should continue in their or if they should drive the rest of the truckers out of business, you'll have a monopoly, and then you'll see your freight rates go up.

Senator BARTLETT. How many men would a private trucker have on that same size truck with the same size load.

Mr. CARR. Well, knowing our truckers, they'd probably have one. [Laughter.]

Senator BARTLETT. Mr. Barton?

Mr. BARTON. Mr. Carr, I take it you feel that in view of the favorable wage scale of the Alaska Railroad as compared with the truckers, plus the fact that the railroad is not regulated, puts the trucker under, you might say, a double-barreled disadvantage.

Mr. CARR. It certainly does, sir.

Mr. BARTON. And that it's your opinion that if the Interstate Commerce Commission were placed in position to regulate the railroad, the result would be fairer treatment to the truckers, the railroad, and the public generally?

Mr. CARR. Yes, sir, I do.

Mr. BARTON. Why do you prefer permissive joint board bill, S. 2452, which provides for the permissive filing of through rates and joint routes rather than S. 2451, that would make these provisions mandatory?

Mr. CARR. Well, I've given that a lot of thought, and to be real truthful with you, the small carrier, I can see

Mr. BARTON. That's what we'd like, sir.

Mr. CARR. Well, to be real truthful with you, the small carrier, would survive.

I can see,

Let's say, for example, a million-dollar trucker would have no more rights under this if its mandatory. If it wasn't mandatory, well, then, it's a more competitive basis.

However, to get to the meat of it-I don't know quite how to put

this

Mr. BARTON. That's all right-you may amend your answer for the record later, if you desire.

Mr. CARR. Well, I don't want to say the wrong thing here, and have the railroad clobber me. [Laughter.]

Mr. BARTON. That's all I have now, Mr. Chairman.

Senator BARTLETT. Thank you, Mr. Carr. Are there any further questions?

All right. Mr. Geraghty.

STATEMENT OF CLYDE GERAGHTY, TERMINAL MANAGER OF MITCHELL TRUCK & TRACTOR SERVICE, FAIRBANKS, ALASKA

Mr. GERAGHTY. My name is Clyde Geraghty and my address is 210 Bonnefield, Fairbanks.

I am a stockholder and terminal manager of Mitchell Truck & Tractor Service. I am also a member of the Alaska Highway Carriers.

I am speaking in favor of some type of regulation on the Alaska Railroad which should be the ICC. It is my feeling that the Alaska Railroad doesn't use a realistic approach on the establishment of their rates. Their operation has, with one exception, yet to make any capital improvements from their revenues, the one exception being the Fairbanks passenger depot.

All other major capital improvements have been made through appropriations from Congress. Needless to say, this is not the case with private trucking operators and businesses.

I have prepared the following comparison on class rates using the Northern Pacific Railroad class rates for moving commodities from Seattle, Wash., to Missoula, Mont. This distance is approximately 460 miles. The distance from Seward to Fairbanks is approximately 470 miles. The Northern Pacific Railroad is assumed to move its greatest tonnage westbound; even so, their eastbound movements must be of sufficient volume for establishing a realistic tariff. The Northern Pacific Railroad crosses a high divide and we assume must have a snow removal problem similar to what the Alaska Railroad experiences, except that the season may be a month or two shorter. Even so, it would seem quite evident that the cost of operating in Alaska cannot be as cheap as stateside from a matter of cost of fuel, freight, or equipment and labor.

The rates in the case of Northern Pacific Railroad are obtained from North Pacific Coast Freight Bureau Tariff No. 1016, which includes pickup and delivery.

In the case of the Alaska Railroad they are obtained by subtracting Alaska Steamship Tariff No. 795 to Seward from the Alaska Railroad's Tariff No. 5N covering through shipments from Seattle to

Fairbanks including delivery. It also includes the wharfage and handling in Seward.

Shall I go ahead and read these rates?

Senator BARTLETT. Why don't you take a couple of typical examples, and then we'll include the rest in the record?

Mr. GERAGHTY. All right. Well, I'll take the third class to start out with.

The Alaska Railroad's Tariff No. 5N quotes $5.13 from Seattle to Fairbanks including delivery; the Alaska Steamship's Tariff No. 795 is $2.35, and you take $2.35 off of $5.13, and it'll give you $2.78 for the railroad's proportion.

Compare the $2.78 against the Northern Pacific Railroad, who charge $3.37 on their third class; that makes a difference of 59 cents less that the Alaska Railroad is performing that service for.

Taking the fifth class I'll just jump to the fifth class now-the Alaska Railroad's No. 5N Tariff is $3.94; Alaska Steamship's is $1.85, giving the railroad $2.09 for fifth class, and the Northern Pacific Railroad's figure is $2.78, making a difference of 69 cents less that the railroad is performing that service for.

Now I'll jump down to the worst example of that, which is class C. Alaska Railroad's Tariff No 5N is $2.85. Alaska Steamship's tariff is $1.50, giving the railroad-the Alaska Railroad-$1.35 for their proportion of that tariff, and the Northern Pacific Railroad charges $2.18, and that makes a difference of 83 cents less the railroad is performing this service for.

These will give you a few examples, and then you members will have the copies showing the rest.

Senator BARTLETT. The remainder of the table, Clyde, will appear in the printed record.

(Table follows in full, for the record:)

Mr. GERAGHTY. OK. Now, as shown in the comparison, the Alaska Railroad is labeling itself as a more efficient and better operator than the stateside operator in face of higher operating costs, no backhaul revenue, and the moving of a smaller amount of tonnage one way.

The trucking industry cannot cope with a Government owned and operated railroad which does not answer to any regulatory body, which does not amortize its capital investment, and which does not