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Mr. HUNGATE. Mr. Cohen ?

Mr. COHEN. Mr. Chairman, I don't have a question fc: these witnesses. But I would like to point out for the record that during the break this morning a representative from the Interstate Commerce Commission did indicate, with reference to the question that was raised earlier concerning new entries, that there were, as far as the ICC was concerned, 31 new entries, not simply a transfer by existing companies. Is that correct?

[From the audience.]
Mr. SCHACK. That is correct.

I am Edward J. Schack. I am Associate Director of the Office of Proceedings, ICC.

Mr. HUNGATE. Mrs. Fenwick?
Mrs. FENWICK. How many members are in your association?
Mr. JASMAN. We have slightly under 2,000.

Mrs. FENWICK. Are they certificated carriers or independent owneroperators ?

Mr. JASMAN. We have a mix of both. We have some when I say certificated carriers, I am speaking of those who have sole authority with the Illinois Commerce Commission for intrastate authority. And they operate usually in exact commodities in interstate commerce.

Mrs. FENWICK. I see. And no members who are certificated by the ICC?

Mr. JASMAN. I would hate to say that. I have probably got some somewhere that have some authority for feed, fertilizer, or some of those agricultural sort of areas, which is our main thing out in Illinois.

Mrs. FENWICK. Do you understand why somebody is certificated only for feed and not allowed to carry washing machines. What is the reason for that, do you

know? Mr. JASMAN. I would say perhaps it would be much easier to secure authority for feed or fertilizer, he wouldn't be going up against some big name truckline who would oppose his application for authority.

Mrs. FENWICK. What difference does it make whether a big truck company opposes it?

Mr. JASMAN. Well, normally when that type of situation arises, the odds on you being able to secure that authority are greatly diminished. If you go with no one opposing yoạr application, your odds on getting that authority are pretty good. But if you have a lot of opposition, it is much more difficult to secure the authority, if not impossible in some cases.

Mrs. FENWICK. But you don't have opposition from the ICC, you have opposition from competitors.

Mr. JASMAN. From competitors. They can intervene as interested parties.

Mr. COHEN. If the gentlewoman would yield, the burden is on those seeking the permit to demonstrate that the existing service is inadequate, and if it is being opposed by the major carriers they have a very heavy burden to overcome.

Mr. Russo. Would the gentlelady yield further?
Mrs. FENWICK. Yes.

Mr. Russo. I think one of the problems you face here is the problem with the route purchases. When the big companies need something, they will come to the owner-operator and ask him to fill in, because they have a heavy route, but they won't let the owner-operator actually go in on his own authority to purchase their routes so that they can compete with him. Because the owner-operator really can probably do it at a cheaper rate than the larger company, but they keep the competition down, they won't let him do it. It is called the free enterprise system.

Mrs. FENWICK. I see. The thing that troubles me is that the permit is granted by someone who is not in competition. I can understand how it would work this way if the larger carriers were in the position of granting the permits. But when the Government of the United States is in the position of granting the permits. I can't see why this operates in this peculiar fashion.

Mr. Russo. I think the gentleman from Maine has answered that question for you. That is the reason, because somebody can complain, and the burden of proof is on the individual to prove that the service isn't adequate.

Mrs. FENWICK. I think what we will have to do is change the law. Mr. Russo. I think that is why they are here.

Mr. COHEN. The only observation I would make is, we have been trying to determine why we receive such an unprecedented amount of press coverage today, and photographs, and we narrowed the investigation down that they are either representatives from the Teamsters or the Interstate Commerce Commission.

Mr. HUNGATE. I think we have had an exceptionally good attendance of the subcommittee members today which reflects the interest and concern with the serious problems that have been raised. I think we have profited from the facts—it seems to me that each of these witnesses has highlighted a different area that is a problem if you are a small businessman or woman and in this field.

Tomorrow we will be meeting at 9:30 and hearing from the Independent Truckers Association, the Maryland Drivers & Truckers Association, and the California Independent Truckers. The subcommittee will be adjourned until 9:30 a.m. tomorrow.

[Whereupon, at 2:45 p.m., the subcommittee was adjourned, to reconvene at 9:30 a.m. on Thursday, May 20, 1976.]

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REGULATORY PROBLEMS OF THE INDEPENDENT OWNER-OPERATOR IN THE NATION'S TRUCKING INDUSTRY (PART 1)

THURSDAY, MAY 20, 1976

HOUSE OF REPRESENTATIVES,
SUBCOMMITTEE ON ACTIVITIES OF REGULATORY AGENCIES
OF THE COMMITTEE ON SMALL BUSINESS,

Washington, D.C. The subcommittee met, pursuant to notice, at 9:35 a.m., in room 2359, Rayburn House Office Building, Hon. William L. Hungate (chairman of the subcommittee) presiding:

Mr. HUNGATE. The subcommittee will be in order.

We will resume our hearings on the regulatory problems of the independent trucker.

We have scheduled as witnesses this morning Mr. Michael Parkhurst, president of the Independent Truckers Association and publisher, Overdrive magazine, Los Angeles, Calif.; Mr. Theodore Brooks, Maryland Independent Truckers & Drivers Association, Baltimore, Md.; and Mr. James Foote, Association of Independent Owner-Operator Truckers, Cerritos, Calif.

The House, instead of going into session at noon, has moved it up to 11 o'clock today. So we will

be as careful with our time as possible, because we would like to hear from as many witnesses as possible.

Will Mr. Michael Parkhurst come forward, please?
Will you raise your right hand, please ?

Do you solemnly swear that the testimony you will give will be the truth, the whole truth, and nothing but the truth, so help you God?

Mr. PARKHURST. I do.

Mr. HUNGATE. Will you be seated and state your name and address for the benefit of the reporter! TESTIMONY OF MICHAEL PARKHURST, PRESIDENT, INDEPENDENT

TRUCKERS ASSOCIATION, AND PUBLISHER, OVERDRIVE MAGAZINE, LOS ANGELES, CALIF. Mr. PARKHURST. My name is Michael Parkhurst. My address is 1532 North Cahuenga Boulevard, Los Angeles, Calif.

Mr. HUNGATE. Mr. Parkhurst, you have a prepared statement, and without objection it will be made part of the record.

You may proceed to present it or discuss it as you see fit. We will follow the rules of yesterday and try to hold your direct testimony to 20 minutes or less and go on from there.

Mr. PARKHURST. Mr. Chairman, my name is Mike Parkhurst, I am the nationally elected president of the Independent Truckers Association, the largest association of independent truckers in the Nation, with offices in Washington, D.C., Ocala, Fla., Breezewood, Pa., Cincinnati,

Ohio, Des Moines, Iowa, Dallas, Tex., and Los Angeles, Calif. The ITA has officers and members in every single State, except Hawaii, and we hold meetings in every single State, most of those meetings being monthly. Our association is nonprofit. The ITA was originally chartered in 1962 in California. While there are many Canadian members, too, the thrust and scope is primarily for the U.S. citizens. In addition to my role as president, I am also the editor and publisher of the largest selling trucking magazine in America.

The problems of the independent trucker are many and complicated, but, ironically, solving many of those problems is not complicated. It is for this noble purpose that your subcommittee has, I trust, allowed this testimony to be entered.

There is no mystery at to why the problems of the independent truckers arose, for the reasons are clear as two simple but ominous sounding words: monopoly and bureaucracy.

This testimony does not need to occupy hundreds of pages of rhetoric. We do not need to belabor you with thousands of pages of documents in order to ferret out a trend or direction that has suppressed the free enterprise spirit in the Nation's transportation system. You don't need to look any further than to examine the record of one independent trucker from Arizona who has spent over 20 years fighting the smothering bureaucracy of the Interstate Commerce Commission. He is one man-his name and record is in the attached list of documents—who merely tried to haul goods for companies who wanted to use his services. But, many thousands of dollars and two decades later, this independent trucker cannot get the so-called operating authority he needs because of two words-monopoly and bureaucracy.

Forty-five years ago, there were approximately 200,000 trucklines in the United States. Then the forces of bureaucracy helped spawn yet another monopoly, for the Interstate Commerce Commission helped to mold a trucking system that has seen hundreds of millions of dollars drained away from small businessmen because they did not have the lawyers, the money, or the patience to spend 10, 15, or 20 years fighting for rights, rights that they thought as Americans they should have.

If the Mafia were to go to all the clothing manufacturers and tell them they could not sell any clothes unless they kicked back 25 to 50 percent of the gross revenue, think of the public uproar. If the gasoline we put in our car was subject to a 25- to 50-percent surcharge by a company that held the mystical rights or license to retail gasoline, think of the public uproar. If every pound of meat on your Sunday dinner table had to be purchased through a complicated kickback system of license holders who owned no farm, no feedlot, and no market, the housewives of America would march on Washington in 1 hot minute.

These examples are not farfetched. They exist in the trucking industry and have for many years. They exist because the regulations governing trucking have not bent with the times, and have become more and more oppressive.

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