PAGENO="0001" RAILROAD LABOR DISPUTE (D7Oco!«=~O HEARINGS BEFORE THE COMMITTEE ON INTERSTATE AND FOREIGN COMMERCE HOUSE OF REPRESENTATIVES ~TNEPIETH CONGRESS ~IZ~P ~ESSION ON ft. J. Res. 559 TO PROVIDE ~QR THE SE LEMI~N~' OP ~I~E LABOR nrs- PUTE BETWEEN CERTAIN CARRIERS BY RAILROAD AND CERTAIN OF THEIR EMPLOyEE~ MAY ~, 10, 11, 16, 17, 18, 23, 2~, 25~ 31; JUNE 6, 7, 1067 Serial No. 90-7 Printed for the use of the Committee on Interstate and Foreign C~mmerce U.S. GOVERNMENT PRINTING OFFICE 79-~O5 WASHINGTON : 1967 `1 tc~TcL1 PAGENO="0002" O~'iN~*1fl~ A o~q~MMER~ 7 HARLEY 0. STAGGERS, West ~ir~i~iia, C1~a~rman SAMUEL N. ~E~4 Maryland WILLIAM L~ S1PRINGE~R, I~iinois TORBERT I~. MAc1X~NALD, MassaolhisettS 2. A RYOUNGEI~ CaUfo]?4~a JOHN JAR1~IAN, Oklahoma SAMUEL L. DEVINE, Ohio JOHN E. MOSS, California ANCHRR NEZ~SEN, Minnesota JOHN D. DING1~LL, Michigan HASTINGS K1~ltTH, MassachuSetts PAUL G. ROGERS, Florida ~lLENN CUNNINGHAM, Nebraska HORACE R. KORNEGAY, North Carolina JAMES T~ BROYHILL, North Carolina LIONEL VAN DEERLIN, California ~4~MES HARVEY, michigan J. J. PICKLE, Texas ALBERT W. WATSON, South Carolina FRED B. ROONEY, pennsylVania TIM LEE cARTER, Kentucky JOHN M. MURPHY, New York EL RO~EIt1)~ ~WATKINS, Pennsylvania DAVID E,.SATTERFIELD III, Virginia PQNALD 0. BRQTZMAN, Colorado DANIEL J. RONAN, Illinøts CLARENCE J. ~3R0WN, JR~, 0b~o. BROCK ADAMS, ~asbIi1gtOn DAN ~ RICHARD L. OTTINGE~, New York RAY BLANTON, Tennessee W. S. (BILL) STUCKEY, Ja., Georgia1 PETER N. KYROS, Maine1 W. E. W1LLxA~tSON, Clerk KENNETH J. PAINTER, A8sistant Clerk Professional F~taff ANDREW STEVENSON WILLIAM J. DIxON JAMES M. MENGER, Jr. ROBERT W. LI5EMAN 1 Appointed May 25, 1907. II PAGENO="0003" QONTE~TS Hearings held on- Page May 9, ~ May 10, 1967~ --~- 7a May 11, i9~~7 ~ ___~ ~. 115 ~iay 16, 1967 15~ May 17, 1967. ~ ~_L.. ~ 185 May 18' ~ ~~Lv 217 May 23, 1967 ~ ~ 261 May 24, 1967 - - -~ - .... May2~, L967~ ~ .-~- May 31, 1967 355 June 6, 1967 ~1 397 June 7, 1967 ~. 439 Text of House Joint Resolution 559 3 Report of the, Department çf Transporta~~~~ 4 Statement of- Bezmett, Donald, eour~~el, Brotherhood of Loemnotiv~ Firemen and Enginemen Biemiiler, Andrew J., dir~t~r, Department of Legislation, AFL-~CIO - 33~ Boyd, Hon~ Alan S., Secretary, Departme~~ of ~azisportatjon~ 73 Chesser, A. H., legislative. representatj~e, Brotherhood of Railroad Trainmen Fahy, Judge Charles, Chairman, Special Media~1jion PaneL 5, 115 Gilbert, H. B., president, Brotherhood of Locomotive Firemen and Enginemen ~ - .~- - - - - ~- 35~ Ginsburg, David, Chairman, Emergency Board No..169~ 5 Greenough, A. J., president, Pennsylvania Railroad Co 439 Harris, Thomas B., asSociate general counsel, AFL~-Qj~. - - 333 Harve~r, Scott, Labor Eoorzomist~' Office of the Assistant Secretary for Transportation Policy Development~ Department of Transporta.. t~Qfl~. Ignatius, Paul R., Assistant Secretary. of. Defense (Installations and T~iogistics)~_ -~ ~. - 398 Krause, Anthony, assistant general president, Brotherhood of Railway Carmen of America (member, Executive Co~hcil, AFL-CIO Railway Employees' Department) -- - - - - 261 Lane, Maj. Gen. John J., Commander, Military Traffic Management and Terminal Service - - - 398 Leigbty, George B., chairman, Railway Labor ExecutWOs?Assocja tion -~ ~ - - - - - 217 293 Luzia, Charles, president, Brotherhoodo~ R~4ilroad Ttainrnen~~ - - 375~ Marsh, Michael, director of research, Railway Labor Executives' Association - ~- - 217 Meyer, Lt. Gen. Richard D., Director for Logistics, Joint Chiefs of Staff 398 O'Brien, J. W., general vice president, Sheet Metal Workers' Inter- national Associatiari (member,. Exeentive Couricil, AFL-CIO Rail- way Employees' Department) 261 O'NeiJl, Francis A., Jr., Chairman, National Mediatibu Board 5, 115 Parks, Maynard, vice president, Missouri~pacifi0 Line& 159 Prin~e~ Gregory,. executive vice president arid general counsel, Associ- atiQn of American Railroads - - - - 439 Quarles, W. B., Jr., vice chairman, National Railway Labor Confer- ence , -~ 159, ~ Ramsey, Joseph W., general vice president, International Association of Machinists & Aerospace Workers, representing the Executive Council of the AFL-CIO Railway Employees' Department 261, 329 `It PAGENO="0004" IV CONTENTS Statement of-Continued Ramsey, Thomas V., international vice president, International Brotherhood of Electrical Workers (member, Executive Council, l~age AFL-CIO Railway Employees' Department) 261 Reynolds, James J., Under Secretary, Department of Labor 5 Rice, W. Thomas, president, Atlantic Coast Line Railroad Co 423 Schoene, Lester P~, ge~iera1 cpwisei, Railway Labor Executives' Association ~ 217, 293 Wirtz, lion. W. Willard, Secretary, Department of Labor 5, 115 Wolfe, Edward, vice president, Intertiational Brotherhood of Boiler- makers, Iron Ship Builders, Blacksmiths, Forgers & Helpei~s . Sept. 14,1962 (E.G. 11050). Harry H. PlaIt, Chairman; Hubert Wyckoff, Morrison Handsaker. David R~ Stowe, Cimirsnan; Bryon R. Abernathy, H. Raymond Cluster. Saul Wallen, chairman; Israel Ben Scheiber; Emanuel Stein. Joseph Shister, chairman; Lloyd H. Bailer; Edward A. Lynch. Donald B. Str~us; Morrison Hand- saker; Patrick I; Fisher, chairman. Leo C. Brown, Chairman; Eli Rock; Arthur M. Moss. Theodore W. Kheel, chairman; Paul N. Guthrie; Byron B. Abarnethy. Saul WaIlen, chairman; Lawrence E. Siebel, Edward A. Lynch. James C. Hill, Chairman; Thomas C. Begley, Arthttr W. Sempliner. Arthur Ross, Chairthan; Paul I). Hanlon, Charles C. Killingsworth. Joseph Shister, Chairman; Walter F. Eigenbrod. .1. Harvey Daly. Paul N. Guthrie, Chairman; James 1. Healy, Burton B. Turkus. Paul D. Hanlon, Chairman; David H. Stowe, Frank D. Reeves. Keith J. Mann, Chairman; John F. Sembower, Abram H. Stockman. James C. Hill, Edward A. Lynch, Theodore W. Kheel, Chairman. Jacob Seidenberg, Chairman: I. Glenn Donaldson, Robert I. Ables. 0 0 I May 1,1962 - A-6406, June 14, 1962 A-5896~ A-5739. Aug. 30, 1962 No formal report, Aug. 11, 1962. Mar. 4, 1963 (extension to Jan. 5, 1963). Dec. 311, 1962 Dispute resolved by mu- tual agseement between parties. Nov. 10, 1962 A-5809, A-6063. A-6582, A-6663. A-6690L A-6617. A-6701 A-6671 A-6696. PAGENO="0497" Eastern, Western, Southeastern Car- riers' Conference Committees. Pullman Co.; Chicago, Rock Island & Pacific RR. Co.; New York Cen- tral; Soo Line RR. United Air Lines, Inc Florida East Coast Co Braniff International Airways, Con- tinental Airlines, Eastern Air Lines, Inc., Nati~na1Afr1ines, Inc., North- west Airlines, me;, Trans World Airlines, Inc. Eastern, Western, Southeastern Car- riers' Conference Committees. National ltailsvay Labor Conference do Apr. 3, 1963 (E.G. 11101). July 4, 1963 (E.G. 11115). Oct. 9, 1963 (E.G. 11121). Nov. 9, 1963 (E.G. 11127). Dec. 11, 1963 (E.O. 11131). Samuel I. Roseman, Chairman; Nathan P. Feinsinger, Clark Kerr. Jacob Seidenberg, Chairman; 1. Keith Mann, Frank D. Reeves. Paul D. Hanlon, chairman; Eli Rock, Laurence E. Seibel. Harry H. Platt, chairman; Derek Bok, Paul N. Guthrie. Ronald D. Haughton, chairman; Lewis M. Gill, John W. McConnell. James C. Hill, chairman; Joseph Shister, Michael Deane. Saul Wallen, chairman; Jean `P. Mc- Kelvey (Mrs.), Arthur M. Ross. Richardson Dilworth, chairman; Paul 1). Hanlon, Rabbi Jacob Joseph Weinstein,9 Robert J. Ables, Lewis M. Gill, H. Raymond Cluster, Frank J. Dugan. (Same as E.B. 161) do Ronald D. Haughton, chairman; Jacob Seidenberg, Louis Crane. Settled in conferencebetween parties Wayne Morse, Chairman; David Ginsburg;Richard E. Neustadt. John Dunlop, B. Manning, 1. P. Drew David Stowe, C. Rhemus, J. P. Williams. David Ginsburg, Frank J. Dugan, John W. McConnell. George E. Reedy, Jr., Roland Boyd, N. Thompson Powers. A-6700. A-6794, A-6795, A-6796, A-6797. A-6905. A-6627, sub. No. 1. A-6898, A-6899, A-6900, A-6901, A-6903, A-6904. A-6967. A-7030. A-7107. 154 155 156 157 158 159 160 161 162 163 164 165 166 167 168 169 170 BLE, BLF & E, ORC & B, BET, SUNA. BRCP TAM 11 cooperating railway labor organizations. TAM BRS - RED RED 11 cooperating railway labor organizations. 5 cooperating railway labor organizations. BLF&E Brotherhood of Rail- road Trainmen. International Associa- tion of Machinists & Aerospace Workers, AFL-CIO. TWU TWU 6 cooperating shoperaft unions. BRT. IBEW, and JAM. National Railway Labor Oonference - National Railway Labor Conference~ National Railway Labor Conference - Atchison, Topeka & Santa Fe 5 carriers (EAL, NAL, NWA, TWA, IJAL). American Airlines, Inc Pan American World Airways, Inc~ National Railway Labor Conlerence. Long Island Rail Road Jan. 3, 1964 (E.O. 11135). Mar. 17, 1964 (E.G. 11147). Aug. 18, 1964 (E.G. 11169). Aug. 18, 1964 (E.O. 11168). Aug. 18,1964 (E.G. 11170). Sept. 24, 1964 (E.G; 11180). Sept. 11, 1965 (No. 11243). April 21, 1966 (No. 11276). July 27, 1966 (E.G. 11291). Sept. 30, 1966 (E.G. 11308). Jan. 28, 1967 (E.G. 11324). Apr. 12, 1967 (E.G. 11343). Mayl3,1963 Nov. 2, 1963 Nov. 18, 1963 Dec. 23, 1963 No report (Jan. 20, 1964 agreement). Apr. 3,1964 Aug. 7, 1964 Oct. 20, 1964 do - Nov. 5, 1964 None June5, 1966 Aug. 27, 1966 - Oct. 30, 1966 Mar. 10, 1967 Mayl2,1967 A-7127. A-7128. A-7173. A-63l8. A-7655. 0 0 ci 1lnterpretation of report to President dated Aug. 24, 1948. 7Named by White House. 2Clnfifieatiofl of report to President July 23, 1948. 8Withdrawn-A settlement was reached between the parties by an agreement dated 3lnterpretation of report to President dated June 29, 1949. Jan. 10, 1957 and effective Jan. 16, 1957. 4Appointed to serve 1st time. 9Weinstein appointed Sept. 22, 1964, to replace John W. McConnell who resigned ~ to serve as member of R.B. for 1st time. (E.B. 161-162-168 appointed Aug. 18, 1964, by separate Executive orders and heard by 4~.. 6 See E.B. No. 63, under supervision of Government also. See E.B. No. 83, restraining same 7-man Board). order. PAGENO="0498" Supplement to Emergency Board Index (Railway Labor Act)-Stri/ces occurring during or subsequent to the statutory period Emergency board No. . Carrier . Union Datestoppage began Duration Maximum number of workers1 46 *47 55 t*62 70 *71 *73 76 78 81 83 *85 *87,*58&*58A 92 - - *93 974 105 106 Bingham & Garfield Ry. Co Southern Pacific Co. (Pacific Lines); Northwestern Pacific RB. Co.; San Diego & Arizona Eastern Ry. Co. Chicago, North Shore & Milwaukee National Airlines, Inc Carriers represented by Eastern, Western & Southeastern Carriers Conference Committee. Wabash RE. Co. and the Ann Arbor BR. Co Railway Express Agency, Inc - Missouri Pacific RB. Co The Monongahela Connecting RE. Co Carriers represented by the Eastern, Western & Southeastern Carriers Conference Committee. Carriers represented by Western Carriers Conference Committee SUNA Chicago & Iffinois Midland By. Co BRT~ Toledo Lakefront Dock Co. Toledo, Lorain & ~`afrport Dock Co~ Atlantic & East Carolina By. Co. and other carriers Rnilwnv 1~mri~ss As~nt~v Tm~ BLF&E,ORCoTA BLE IU of AA of SB Railway & Motor Coach Employees of America. AIIPA International, lAM BLF&E BLE,BLF&E,ORC,BRT BRC - ~ BLF & E, ORC, BRT BET ORC. BRT Oct. 22,1947 July 21,1947 Mar. 27,1948 Jan. 23,1948 May 10,1950 Mar. 15,1949 Mar. 10, 1941) Sept. 9,1949 Jan. 21,1950 (3) June 25,1950 Apr. 27, 1950 June 18, 1950 Jan. 29, 1951 Sect. 23,1950 Mar. 9,1952 ILA Local 158 Al~ L 16 cooperating nonoperating labor organiza- tions. rrvr (3) Baltimore & Ohio RR. Co., neluding Buffalo Division (formerly Buffalo, Rochester & Pittsburgh Ry.) and Buffalo & Susque- hanna District. Chicago & North Western By. Co., including Chicago, St. Paul, Minneapolis & Omaha Ry., Louisvifie & Nashville RR. Co., Terminal Railroad Assn. of St. Louis and all other carriers represented by Eastern, Western and South. eastern Carriers' Conference Committees (under supervision of secretary of Army, E.O. 10155). Railway Express Agency, nc..~. Akron, Canton and Youngstown Co. and other carriers repre- sented by Eastern, Western, and Southeastern Carriers' Con- ference Committees. 16 I 91 307 7 8 39 45 2 14 3 26 41 20 4 1 58 150 270 1,240 ~?75,ooo 10,000 0 9.240 ~ 27,000 1,200 ~ (3) 59,000 123 (2) ITi (2) 2,000 41,000 24,000 BLP&E BRC June 29,1954 15 cooperating; nonoperating railway labor Mar. 14, 1955 organizations. PAGENO="0499" IBT -. District 50, United Mine Workers of Amer- ica, independent. Flight Engineers, Int'l Assn., EAL Chapter, lAM. ALPA, International BR? TWU of A., Railroad Division and Railway Employees Department, AFL-CIO, Sys- Board No. 152. Employees represented by labor organiza- tions, members of the Railroad Marine Harbor Council. Flight Engineers International Association, 7 73,000 PAA Chapter. Flight Engineers Int'l. Association (6) 17,000 ~ ORT 30 L5,000 0 BLE, BLF & E, ORC & B, BRT, SUNA~ 2 20,000 ~ 11 cooperating railway labor organization&_.. (7) 2,023 International Assn. of Machinists & Aero~ 43 (2) space Workers AFL-CIO. 0 `Data on stoppages involving 10,000 workers or more are taken from annual reports on 6Regular flight operations were resumed in September 1962. work stoppages issued by BLS; data on. other stoppages are from annual reports of the Carrier has resumed operations with nonstriking employees and replacements. National Mediation Board. `No published data. Norx.-In the 9 cases marked by an asterisk, stoppages occurred during the statutory ~ 33 stoppages occurred: Aug. 21-26, 1950, no information on workers; Dec. 13-16, 1950, period; in the 2 cases marked by an asterisk and a cross, stoppages occurred during and ~d 10,000 workers; Jan. 30, 1951 to Feb. 10, 1951, 70,000 workers. subsequent to the statutory period; in the remaining 23 cases, stoppages occurred sub- ~ ~A stoppage also occurred on June 16 and 17, 1952, no information on workers. sequent to the statutory perIod. `2 stoppages occurred in addition to that involving Eastern Airlines (see Board No. 120) Capital Airlines, Oct. 14 to Nov. 23, 1958, 7,000 workers; Trans World Airlines, Nov. 21 to Dec. 3, 1958, 14,000 workers. 117 118 120&122 122 124 129 132 Railway Express Agency, inc. Toledo, Lorain & Fairport Dock Co.; Toledo Lakefront Dock Co.; Cleveland Stevedore Co. Eastern Airlines Eastern Airlines, Inc., Trans World Airlines, Inc., United Air Lines, Inc., Northwest Airlines, Inc., Northeast Airlines, Inc., Capital Airlines, Inc., National Airlines, Inc. American Airlines, Inc Long Island Co The l'ennsylvania R.R. Co 133 New York Harbor Carriers' Conference Committee *135 144 147 154 f*157 166 (2) Pan American World Airways Eastern Airlines, Inc Chicago & North Western Ry. and the former Chicago, St. Paul, Minneapolis & Omaha RR. Eastern, Western, Southeastern Carriers' Conference Committees Florida East Coast Co 5 Carriers (EAL, NAL, NWA, TWA, UAL) 88 62 38 22 25 12 14 3, 700 200 14,000 (5) 21,000 1,350 72,000 23,000 Apr. 21,1957 July 7, 1957 Nov. 24,1958 (5) Dec. 20,1958 July 10,1960 Sept. 1,1960 Jan. 10,1961 Feb. 17,1961 June 23,1962 Aug. 30,1962 Apr. 8,1964 Jan. 23,1963 July 8,1966 PAGENO="0500" 494 RAILROAD LABOR DISPUTE [Telegram] WAShINGTON, D.C., May ~t, 1967. Hon. HAnLmr 0. STAGGERs, Waskingtoa, D.C.: The AFL-CIO, Maritime Trades Department-speaking on behalf of its 36 affiliated national and international unions and their more than 51/2 million members-vigorously `opposes the administration scheme designed to suspend the democratic rights of trade unionists in the current railroad dispute. The administration is, engaging in a dangerous game of words when it tries to convince the American people that its so-called plan for "mediation to finality" does not intrude on the freedom of collective bargaining. By any name, this is compulsory arbitration-rammed down the throats of unions which have been patient beyond belief in their dealings with a recalcitrant management. For months, the railroad industry has frustrated free collective bargaining. It has stubbornly refused to enter into any meaningful negotiations with the legal union representatives of its employees. Rail management has `made no bones about wanting nothing less than the ultimate weapon-compulsion. The blockades that the industry liSa erócted to free collective bargaining have been designed to force Congress to enact such an undemocratic law The White House now seeks to reward management for it~ destructwn of free bargaining by giving them what they have always `sought. At `my point along the way had Congress or the White house made it quite plain that railroad workers-like other American workers-were entitled to the right to withhold their services, the rail dispute would' never `have reached the present crisis stage. Faced with the reality that the rail unions could strike, after exhausting all of the procedures of the Railway Labor Act the industry long ago would `have come to the `bargaining table and the two sides could have hammered out their differences. Up to~ now, management has had nO incentive to sit down and bargain- indeed, its incentive has been to stay away from the table in order to increase its pressure on the Congress and the administration to come up With compul- slonary legislation that works to the disadvantage of free trade unionists Even at this late hour, Congress can make the only sensible contribution to ending this imj~ossible situation by rejecting compulsory arbitration by what ever name and by affirming the right of free railroad workers to strike Faced with the inevitable, management would quickly come to term's with its workers- and the cause of free collective bargaining would best be served. We urge you, then, to repudiate this move by rail management to make the Government of the United States its not-so-silent partner at the bargaining table The power and prestige of the Government should not be made a servant of the rail industry. The p'~oposal by the President should not be accepte&- for it would destroy the freedom of one group of workers, make the freedom of all workers less secure, and, in the end, it would endanger the freedoms of all Americans. MAiuTIME TRADES DEPARTMENT, AFL-CIO, PAUL HALL, President. Pwrnim M. MOGAVIN, FJa,ecutive ~1ecretary-Treasurer. [Telegram] Nnw YORK, N.Y., May 10, 1967. Representative HARLEY 0. STAuGims, (Thairman, House (JoGnflierce CommIttee, House Office B'uil4ing, WashIngton, D.C.: The international officers of the Transport Workers Union of American, AFL- ClO, representing 150,000 members throughout the Nation, strongly urge that you reject President Johnson s strike ban proposal to force compulsory arbitra tion on the Nation's railroad shopcraft workers. Such repressive legislation de- prives them of their rights and `compels them to remain working under substand- PAGENO="0501" RAILROAD LABOR DISPUTE 495 ard wages and conditions while the railroads continue to operate at a profit. Compulsory arbitration, by any name, is a tyranny that has no place in our free society. MATTHEW GUINAN, International President. DoUGLAs L. MACMAHON, International Secretary-Treasurer, JANLES F. HousT, International Eoecutive Vice President. ~Telegra~n1 WASIIINGTON, D.C., May 8, 1967. Representative HARLEY 0. STAGGERS, Cha4rman, Honse Committee on Interst ate and Foreign Commerce, Rayburn Office Building, Washington, D.C.: The nation right to work committee respectfully requests the opportunity to present Its views in connection with the proposal being considered for dealing with Railway Labor Act strike emergency provision. Regardless of steps taken to solve the current railway crisis we believe legislation should Im included to re- move basic defects in the Railway Labor Act and prevent the recurrence of to- day's threatened transportation paralysis. Runs B. LARSON, National Right to Work Committee. ALEXANDRIA, VA., June 10, 1967. Hon. HARLEY 0. STAGGERS, Chairman, House Committee on Interstate and Foreign Commerce, Rayburn House Office Building, Washington, D~C. DEAR Mn. CHAIRMAN: I appreciate the opportunity to submit the following statement for the record on H.J. Res. 559. I am. an Independent economist who has heard most of the testimony on this resolution. I have no professional con- nection with either railroad management or railroad labor or any acquaintances among them. My interest is solely that of one deeply concerned for almost 40 years in finding out why the United States economy falls to provide respectable, suitably-paid jobs for all, without price inflation, and with fair treatment for all groups. This statement particularly endeavors to supply a few statistics and analyses on the more fundamental problems involved. 1. Enactment of the resolution is clearly preferable both to allowing a rail- road strike and to legislation enabling the Government to "seize" the railroads, but additional action by the Congress and by the Executive Branch is vitally needed, along with a major change in a kOy American economic policy. 2. Enactment of the resolution will be far from a satisfactory solution of the basic problems, for several reasons: (a) If, following a failure of the parties to agree "voluntarily," the determinations of the Special Board stipulated in the resolution are put into effect (until not later than January 1, 19~9), a genuine settlement of the basic differences will only be postponed for 18 months or so. There is no reason to believe that such a postponement will reduce the gap between the two parties. (b) The difficulties caused for Members of Congress and the Presiden.t by having to take the steps so far taken in this dispute and in having to espouse this resolution-difficulties which several members of the Com- mittee candidly deplored during the hearings-may create a pattern to be repeated in further railroad and other labor disputes, unless measures arc taken to prevent It. (c) Since the determinations of the five-man Special Board ma~ turn on the vote of a single member, and will In any case turn on the vote of three PAGENO="0502" 496 RAItROAD LABOR DtSPtTE1 members, this procedure will make an important public Issue hinge on the personal leanings of the Presidential appointees, without possibilities of appeal or review. (d) Injurious trends have been proceeding for 30 to 40 years both in the railroad industry and U.S. industry generally, injurious trends which neither determinations by the Board nor reaching of a voluntary agreement offer any realistic promise of improving. 3. In the case of railroads these injurious trends are the heavy and progressing losses which each of the four major groups concerned-the public, railway labor, railroad investors, and the Federal and local Governments-have all suffered in one way or another over the past 40 years: (1) The American public is losing railroad service. A decline in the use of railroads for passengers and freight, whether relative or absolute, should be accepted if it means better service to the public, comprehensively meas- ured. Problems, however, from the congestion, fumes, noise, etc., of truck, automobile, and airplane traffic, now reaching crisis proportions, and the surrender of more and more prime land in metropolitan areas to roads and terminals which constitute a very heavy financial burden rather than a source of positive tax revenue from that land, are crucial issues in which greater use of railroads may be able to make a contribution. (ii) Railroad labor has lost a very large amount of employment. From 1.8 million employees in 1924/27, the number has sunk to around 630,000- a decline of nearly 2/3 rds. Average annual earnings of individual railroad employees, on the other hand, have increased 41/2 fold, from approximately $1,700 for 1926/80 to $7,734 in 1966. Inclusion of all fringe benefits, amounting to more than $1,000 a year per employee in 1966, according to the 1967 Yearbook of Railroad Facts (of the Association of American Railroads) would bring the compre- hensive increase to over five fold. Aggregate compensation of railroad employees increased % rds from 1926 to 1966, the same proportion that the number of employees declined, Allowing for the reduction of the value of the dollar over that period, which was about 50% as measured by the Consumer Price Index, aggregate com- pensation in 1966 represented about 17% less purchasing power than was paid annually during the 1920's. Railroad employees also gained from the very sharp reduction in the num- ber of employees killed and injured in railroad accidents yearly, (iii) Financially owners of railroad stocks as a group have made out much worse than railroad employees as a group or individually (on the aver- age) since the 1920's. Dividends on railroad common and preferred stocks have apparently declined in absolute dollar amount (according to the Inter- State Commerce Commission figures published in the Department of Corn merce's Historical Statistics of the United States and the annual Statistical Abstract) (A further downwatd ad)ustment seems necessary to eliminate double counting of railroad dividends paid on stock owned by other rail- roads) After taking into account the decline in the value of the dollar own ers of railroad stocks are receiving much less purchasing power today than in their dividends during the 1920's. If one takes into account the long periods since 1930 when dividends on railroad common stocks in the aggregate have been at very low levels, their owners as a group would have been far better off during these four decades to have had their investment in bonds, savings deposits, or other forms. 1~ven in 1966, when railroad dividends reached their highest total in many years, the rate of return on the owners' equity (capital stock plus surplus) was only 2.80%, according to the Yearbook of Railroad Facts. (iv) The Federal Government s receipts of income taxes from railroads have been trending downward since World War II (except for the period of the Korean War), and both it and some local governments are having to appropriate tax funds to preserve commuter service by rail in some localities and to pay part of the costs of developing high-speed passenger service be- tween Washington and Boston. 4. The outstanding injurious trends affecting U.S. industry generally rather than railroads in particular during the last 40 years are first, the huge inflation which has advanced fairly steadily since the low point of the Great Depression. As already stated, the decline in the value of the dollar as measured by the Con- samer Price Index of the Bureau of Labor Statistics has been about 50% since 1926 As measured by some indexes of the costs of construction the price rise has PAGENO="0503" RAILROAD LABOR DISPUTE 497 been larger-about three fold. Secondly, there have been long periods of excessive unemployment and business depression. The danger of further inflation is again increasing, now that the country is in a period of mounting wage increases each year and is facing the prospect of much larger Treasury deficits than during recent years. 5. Contrary to allegations by some, the price rises have not been due to dispro- portionately large profits of corporations, speaking generally. 6. Within the ever-mounting total of aggregate wages and salaries in the United States economy there is apparently a hidden gain of the best p'ud at the expense of the worst paid. The latter have to buy goods and services containing the costs of the former, and they are artificially barred from competing for many of the better paid lines of work. Steps by Congress and the Executive Branch to overcome that trend seem essential to the nation's conquest of poverty, the improvement of cities, and other goals. Allowing the more powerful bargaining groups unlimited scope to exert their power to strike in obtaining ever higher wage rates and more wasteful work rules will defeat those goals. Respectfully submitted. Gr~oiiau A. Enny. (Whereupon, at 12:03 p.m. the committee adjourned, to reconvene in executive session at 10 a.m., Thursday, June 8, 1967). 0 PAGENO="0504"