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Mr. BOREN. Would you go strong enough to say that in relation to present problems, that you would recommend definitely against any change in it?

Colonel GORRELL. I would recommend that that phase of the law be left alone and that we take another look at it in the future..

Mr. BOREN. I wonder if at this point

Colonel GORRELL (interposing). It is not any great problem right now, because the industry cannot get planes and no one is going to be seeking securities of any consequence at the present time.

NEED FOR LEGISLATION IN RECENT PAST

Mr. BOREN. I wonder if this is the proper time for me to refer to a little more general question. It seems to me that I recall when you were before this committee on the Transportation Act of 1940 that at that time you made a definite, a positive recommendation to this committee that no new legislation with reference to civil aviation be enacted at that time. That was on the Transportation Act of 1940. Now, speaking from memory, of course, am I correct in that recollection?

Colonel GORRELL. Yes, sir; we appeared before you in the hearings on what was called the omnibus bill, and later became the Transportation Act of 1940, and pleaded with you to give us no legislation. We told you that we had had in the previous 14 years 12 different acts of Congress, and that 12 changes of Government policy by legislation in 14 years was enough to ruin anything, and we asked you to give us a breathing spell in order to get our feet on the ground.

Mr. BOREN. Have you felt that up to now, that now is the first time that there has been any reason for new legislation?

Colonel GORRELL. Yes; I have talked to your chairman over a period of several years on the subject of legislation. I think the first time I talked to him about it was a couple of years ago, on the need of covering the subject of liability. I talked with him last fall on the need for getting busy on some of the things we need in the future, with the turn of the year, after our industry got out of its system some of the military problems we were then handling.

Mr. BOREN. Congress has constantly given considerable thought to the legislative situation, past, present, and prospective future, with reference to aviation, and I remember in a casual way that in the Transportation Act of 1940 you made a rather strong statement in that direction and I wondered if to that extent you felt it will contribute to our hearings in connection with this subject, if when you revised your statement you would add any portion of that former statement that you feel will contribute to this question.

Colonel GORRELL. I would be very glad to look it up, sir.

Mr. BOREN. I thank you very much.

The CHAIRMAN. At this time the committee will recess until 2 o'clock this afternoon.

Mr. BOREN. Mr. Chairman, before making that decision, there is a caucus this afternoon.

Mr. WOLVERTON. Would it be appropriate to have the Colonel state what he expects to cover in his statement this afternoon?

Colonel GORRELL. If I am permitted to do so, I would like to take up paragraph 1 (b) of the bill under "Post war planning."

Mr. WOLVERTON. I think that is a matter the whole committee will be interested in.

The CHAIRMAN. I hope that the members will be here to consider that important subject.

(The excerpt requested by Mr. Boren is as follows:)

EXTRACT FROM THE TESTIMONY OF EDGAR S. GORRELL, PRESIDENT, AIR TRANSPORT ASSOCIATION OF AMERICA

[Before the House Committee on Interstate and Foreign Commerce, House of Representatives, 77th Cong., 1st sess., on H. R. 2531 and H. R. 4862-vol. 2 of the printed hearings, pp. 1482, 1483, and 1484]

Colonel GORRELL. This committee knows that the industry sought and supported the Civil Aeronautics Act, despite the fact that that act places upon air transport, in full flower, all the strict obligations which our country has evolved for fully developed transportation services. The reason for this unprecedented stand on the part of the industry was the experience it had endured for the past dozen years, and the conviction that if there were not adopted a stable, permanent legislative charter we might be swept from the airways by unbridled competitive forces and by the stress created through vacillating policies. We had reached a point where investors had lost hope, and we required at least the fighting chance which a stable and permanent regime would give us. Between 1925 and 1934 there were, for domestic air transport, four separate measures, adopted by the Sixty-eighth, the Sixty-ninth, the Seventieth, and the Seventy-first Congresses, respectively, each of which represented a vital change in the Government's policy toward the economics of air transport (Public, No. 359, 68th Cong.; Public, No. 178, 71st Cong.). Then came the air-mail contract cancelations, and the companies were shaken up, reorganized, and relocated in the most severe manner. The Air Mail Act of 1934 was adopted with radically new provisions. And the following year there came the far-reaching 1935 amendments, after a message from the President in which he said that in legislating for the industry "any profits at all by such companies should be a secondary consideration" (S. Doc. No. 15, 74th Cong., 1st sess., p. iv). And in 1936 the industry was placed under the elaborate regulation of the Railway Labor Act (Public, No. 487, 74th Cong.). The Air Commerce Act of 1926 had also been adopted and amended during this period (Public No. 254, 69th Cong.; Public, No. 846, 70th Cong.; Public, No. 418 and 420, 73d Cong.), as had been an Air Mail Act for operators in overseas and foreign commerce (Public, No. 107 and 904, 70th Cong.).

AIR TRANSPORT OVER-REGULATED

By 1936 important powers concerning civil aeronautics were vested in the Post Office Department, in the Interstate Commerce Commission, in the Department of Commerce, in the Department of the Treasury, in the Department of Labor, in the Department of Agriculture, in the National Mediation Board, and in the Federal Radio Commission and along the way the National Recovery Administration, the National Labor Board, and the Federal Aviation Commission had all had their say. Moreover, the State Department, the War Department, and the Navy Department had at all times been vitally interested in civil aeronautics and had exercised important influences. We were also subject to regulation by the Federal Trade Commission and by the Securities and Exchange Commission. With all this division of control, with administrative policies changing first here and then there, the Congress itself was constantly changing its mind and making in one year radical departures from policies laid down the year before.

AVIATION SUFFERED SERIOUSLY FROM CONFLICTING AND CHANGING CONGRESSIONAL

POLICIES

Probably at no time in the entire history of our Government has any single industry passed through such a period of confusion and such a maze of conflicting and changing policies. It is hardly to be wondered, therefore, that during this time the mortality rate of air carriers was something over 80

percent and that half of the private capital which had been hopefully devoted to the future of air transportation was irretrievably lost.

Beginning, then, with the Sixty-ninth Congress, each one, to date, except the Seventy-second Congress and the present, Seventy-sixth Congress, has adopted at least one new and vitally different statute affecting air transport. (The 77th Cong. adopted the Civil Aeronautics Act.) In the 14 years beginning with 1925 and ending last year, there had been at least 12 fundamental legislative changes.

It is not altogether a coincidence that during the period when civil air transport was so badly crippled by a mercurial Government policy and by divided jurisdiction, the Air Corps of our Army had been reduced almost to impotence by similar tinkering and changing, vacillation and indecision, on the part of those in authority. Nor is it altogether a coincidence that during the same period the Air Corps of our Navy reached a pinnacle of power, efficiency, and prestige enjoyed by no other nation, because years ago a policy had been set forth and adhered to with singleness of purpose. Nor, again, is it altogether coincidental that, when the plight of the Army Air Corps was fully realized, our President took a firm stand that a policy should be laid down for the Army and should be unswervingly adhered to in the future until our military air arm had achieved its proper strength.

These developments in the field of military and naval aeronautics are not, I say, altogether coincidental, for the highly technical character of civil aeronautics, like that of military and naval aeronautics, demands a regime of stability and of single purpose if progress is to be made. Just as a recognition of this fact led the President to insist on such a regime for military aeronautics, so it led him to support and to approve the Civil Aeronautics Act.

And it is, indeed, high time that the air-transport industry be permitted to settle down and consolidate its position. We are working out our problems under the new act. Do not, we pray of you, send us once more on the disheartening trek from one governmental agency to another. Give us the opportunity to repair past damage, to build a new foundation, and to secure some conception of what our powers and our capacities really are.

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The CHAIRMAN. The committee will stand in recess until 2 o'clock. (Thereupon, at 12:01 p. m., the committee took a recess until 2 p. m. of the same day.)

AFTER RECESS

(The committee reconvened, pursuant to the taking of recess, at 2 p. m.)

The CHAIRMAN. The committee will come to order. You may proceed, Colonel Gorrell.

STATEMENT OF COL. EDGAR S. GORRELL, PRESIDENT OF THE AIR TRANSPORT ASSOCIATION OF AMERICA, WASHINGTON, D. C.Resumed

Colonel GORRELL. Mr. Chairman, before taking up paragraph 1 (b), may I suggest the insertion in the record of a newspaper clipping giving a statement by General MacArthur as to a conception of the use of air transport in, war?

The CHAIRMAN. Very well, we will be glad to have it. (The article referred to is as follows:)

[From Washington Post, January 25]

MACARTHUR SEES AIRPOWER AS KEY TO VICTORY

SAYS CORRECT USE OF PLANES MADE FOR PAPUA SUCCESS

By the Associated Press

ALLIED HEADQUARTERS IN AUSTRALIA, January 24.-Gen. Douglas MacArthur, Allied commander in chief in the Southwest Pacific, said today that in his forces,

hard-fought but winning battle for Papua "a new form of campaign was tested which points the way to the ultimate defeat of the enemy in the Pacific."

This new method of warfare the general said, primarily involves "the continuous, calculated application of air power."

He remarked particularly that in the northeastern New Guinea fighting the Allies' air arm had been found effective and important not only as an offensivedefensive weapon but as an instrument of troop transport and supply.

"Our air forces and ground forces were welded together in Papua, and when in sufficient strength with proper naval support, their indissoluble union points the way to victory through new and broadened strategic and tactical conceptions." MacArthur said in written comment on the action now concluded.

Close coordination between air and land units will permit "swift, massive strokes" against the enemy and preclude the necessity for a "dilatory and costly island-to-island advance," he predicted.

The text of MacArthur's written comment:

"The destruction of remnants of the enemy forces in the Sanananda area concludes the Papuan campaign. The Horii army (Lt. Gen. Tomitaro Horii commanded the estimated 15,000 Japanese troops in Papua) has been annihilated. "The outstanding military lesson of this campaign was the continuous, calculated application of air power inherent in the potentialities of every component of the air forces employed in the most intimate tactical and logistical union with ground troops.

"The effect of this modern instrumentality was sharply accentuated by the geographical limitations of this theater. For months on end, air transport with constant fighter coverage moved complete infantry regiments and artillery battallions across the almost impenetrable mountains and jungles of Papua and the reaches of the sea, transported field hospitals and other base installations to the front, supplied the troops, and evacuated casualties.

"For hundreds of miles bombers provided all-round reconnaissance, protected the coast from hostile naval intervention and blasted the way for the infantry as it drove forward.

"A new form of campaign was tested which points the way to the ultimate defeat of the enemy in the Pacific.

"The offensive and defensive power of the air and the adaptability, range, and capacity of its transport in an effective combination with ground forces represent tactical and strategical elements of a broadened conception of warfare that will permit the application of offensive power in swift, massive strokes rather than the dilatory and costly island-to-island advance that some have assumed to be necessary in a theater where the enemy's far-flung strongholds are dispersed throughout a vast expanse of archipelagos.

"Air forces and ground forces were welded together in Papua, and when in sufficient strength with proper naval support, their indissoluble union points the way to victory through new and broadened strategic and tactical conception."

POST-WAR PLANNING

Colonel GORRELL. The second part, that is, paragraph (b) of section 1 of the bill is of greatest importance. This section calls upon the Civil Aeronautics Board to report to Congress concerning developments in civil aeronautics which may be anticipated after the war with plans for such development as will assure the preeminence of the United States.

Because of the broad jurisdiction and its intimate acquaintance with the problems, the Civil Aeronautics Board is of course eminently qualified to undertake this important function. As a matter of fact, it has already, and quite properly, set for itself certain important research projects described in Appendix S-1 of Senate Document No. 206, part 2, Seventy-seventh Congress. It is of great importance that not only these specific projects which it already has planned but also further projects relating to our post-war future should be undertaken and pushed vigorously to a conclusion. Certainly the Congress and the country at large will need to have expert advice at an early

date concerning the ends toward which our civil aeronautics should be working in order to assure unquestioned supremacy of the American flag and concerning the various steps which should be taken to achieve such ends.

It is gratifying to note in this particular section of the bill a recognition of the special importance of the matter of transporting cargo by air. That cargo air transportation will one day be widespread is as clear as crystal. That other countries have made substantial progress in this respect is also clear. Indeed, the great bombing raids that be being carried out every day are nothing more nor less than costly and terrifying experiments in the transportation of cargo by air. America made the world's first plans for transporting bombs by air for large-scale bombardment of enemy territory. It would seem particularly appropriate for America to make the first plans for the transportation of cargo by air in peacetime commerce on a sound and widespread basis. Whether such transportation on an economically feasible basis is already possible is a question to which no person knows the answer. You hear every day glib talk of transporting cargo at 5 cents, 10 cents, or 20 cents a ton-mile, but there is not a single living person who can demonstrate the validity of his figures with any appreciation of the practical problems which are involved.

As to the transportation of a large volume of cargo by air in the near future, I feel the opposite of Thomas Jefferson when he wrote on aviation and signed himself "With more good will than confidence, and wishing you success."

Mr. Chairman, I have here a photograph of that letter of Thomas Jefferson. With your permission I would like to pass it around. It may be that you would want it for your record. Some gentleman by the name of Lee wrote to Jefferson saying that it had been found that a balloon could support weight in the air. He wanted to find a mechanical means of steering the balloon. Jefferson wrote back that he knew of no such mechanical means, and that it would have to be based on principles theretofore not devised, and wishing him success "With more good will than confidence.” I would like to pass

this letter around.

With your permission, may we insert the letter at this point?
The CHAIRMAN. Yes.

(The letter reads as follows:)

Mr. D. W. LEE.

MONTICELLO, April 22, 1822.

SIR: Your letter of the 15th is received, but age has long since obliged me to withhold my mind from speculations of the difficulty of those of your letter that there are means of buoyancy by which man may be supported in the air, the balloon has proved, and that means of directing it may be discovered is against no law of nature and is therefore possible as in the case of birds, but to do this by mechanical means alone in a medium so rare and unresisting as air must have the aid of some principle not yet generally known.

However, I can really give no opinion understandingly on the subject and with more good will than confidence wish you success.

THOMAS JEFFERSON.

Colonel GORRELL. There was another friend of America named Benjamin Franklin who had a different type of vision on transporting things by air. In 1783 Paris became mildly excited over its pioneer balloon ascensions. Franklin was alert to the destiny of those first, feeble efforts to command the skyways.

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