Senator JOHNSON of Colorado. Thank you very much, Mr. Devereux. Did you have anything further?

Mr. DEVEREUX. I would just like to file this statement.

Senator JOHNSON of Colorado. Yes; you may put that in the record. (The statement submitted by Mr. Devereux is as follows:)

The Hampton Roads Maritime Exchange, representing maritime interests located at Newport News, Norfolk, and Portsmouth, Va., is vitally interested in any matters which affect the water-borne commerce-foreign, intercoastal, and coastwise-moving through these ports, also matters which affect the interests of its members. It is the opinion of the Hampton Roads Maritime Exchange that the proposed bill, S. 293, will adversely affect this commerce and is not to the best interests of some of its members. At a meeting of the board of directors of the Hampton Roads Maritime Exchange held June 22, 1945, by unanimous vote of the directors present the exchange went on record as being opposed to the bill, and directed the president of the exchange to appoint a committee to draw up a brief in opposition to this bill. Also, to actively oppose the bill at any hearings which the United States Senate might hold in connection with it.

The Hampton Roads area is primarily a shipping center and is dependent for its prosperity to a large extent on the water-borne commerce moving through its ports. Any factor which tends to increase the cost of handling this commerce works adversely to the best interests of these ports, and in the opinion of the Hampton Roads Maritime Exchange under terms of the proposed bill handling costs in connection with water-borne commerce would be materially increased. Prior to outbreak of the present war Hampton Roads was served by a number of coastwise lines operating to Boston, New York, Philadelphia, and Florida points. At that time these lines were operating on a very small margin of profit, and it is doubtful if they could resume operations successfully if their costs are to be increased unless freight rates were correspondingly increased; and an increase in rates would adversely affect the movement of this coastwise business in view of present competitive conditions.

This committee is particularly anxious to see the reestablishment of these coastwise lines as it provided gainful employment for several thousand people, and provided a type of steamer service which carried passengers and brought many visitors to this section who otherwise would not have come.

The Hampton Roads Maritime Exchange has also interested itself in the expansion of intercoastal and foreign services which provide sailings from Hampton Roads to all ports of the world, including our own Pacific coast. Part of the prosperity of the United States is dependent on the exportation of our own goods, and after the war our foreign commerce will be in highly competitive markets with exports from other countries. It is, therefore, vital that every effort be made to keep the costs of delivering our goods at the lowest possible figure.

An analysis of 130 voyages made by vessels in the years between 1930 and 1938 showed that the cost of handling cargo into and out of ships amounted to slightly over 24 percent of the total cost of the round-trip voyage. This is the highest single item of expense in these operating costs. The margin of profit to the various companies engaged in handling this cargo was not sufficient to have permitted these companies to have absorbed any additional costs. This same condition will hold true when we revert back to regular commercial shipping, and consequently any increase in these costs will have to be passed on to the steamship operators, who in turn will pass same on to the shipping public by asking for higher ocean rates. This would result in higher costs for delivering our goods to foreign destinations, and in a highly competitive market could-and probably would result in the loss of some export trade by the United States. Loss of export trade would materially affect all ports and those of Hampton Roads would be no exception.

In view of these facts, we submit that this committee of the United States Senate should disapprove the proposed bill as written.

The Hampton Roads Maritime Exchange has been requested to oppose the proposed bill S. 293 on behalf of the contracting stevedores and terminal operators at Hampton Roads. These concerns employ water-front labor which is paid on an hourly basis, and on any one operation may not employ the same men from day to day, as frequently during one operation the men quit the job and others take their places. There is a constant change of men going on at all times. The type of work performed by these men, principally where the stevedores are concerned, is the handling of freight between a vessel and a pier floor, to a very recere directly between a vessel and railroad cars and between a vessel

and railroad car floats or lighters. Where the terminal operators are concerned the work is of (1) a general warehouse nature and (2) the actual loading and unloading of freight between railroad cars and pier or warehouse floor.

All work of stevedoring contractors and terminal operators is performed by men receiving the rates of pay provided for in various union agreements, and all are subject to the Social Security Act.

An examination of the manner in which the services are rendered the railroads show that an impractical situation exists in attempting to segregate men working on cars, lighters, or car floats from those employed elsewhere on stevedoring and warehousing operations. At one time, and perhaps for as short a period of time as half an hour, a man or group of men may be under the proposed amendment to the Railroad Retirement Act while working cars, lighters, or car floats. A man or group of men would then revert to straight ship, dock, or warehouse work and would consequently fall under the Social Security Act. It is, therefore, apparent that throughout the operation a man might pass from one act to another several times. Segregation is not practical as required in division (1), paragraph (11) of the proposed amendment to the act. Even if segregation were practical, it would entail an additional expense in timekeeping and accounting, so much so that the contracting stevedores and warehousemen would have to ask for an increase in the rates being paid for the performance of the work being done. Any attempt to segregate men so that one group would perform one type of work and another perform another type of work is not practical as under conditions at Hampton Roads, especially where stevedores are concerned, there is seldom sufficient volume of work on cars, lighters, or car floats to provide a full day's work for such a group. In the terminal operation, depending upon the commodity being loaded, the terminal operator may be called upon to deliver cargo from cars for a period of time and then from a warehouse where the cargo has been stored awaiting shipment, and the same men may be-and often are employed on both operations.

It is the opinion of the Hampton Roads Maritime Exchange and its special committee which has made a study of the proposed bill that the services now being rendered the railroads will place the contracting stevedores and terminal operators in the category of an "employer" within the meaning of the proposed amendment of the act because of the all-inclusive and broad character of its language. The amendment to the act appears to include all employers rendering services to a railroad in the completion of the railroad's obligation of shipment.

The Hampton Roads Maritime Exchange on behalf of the contracting stevedores and warehouse terminals which it specifically represents requests that the committee of the Senate disapprove the proposed bill as written, and in any event should amend this bill by striking out. and disapproving all paragraphs (2), (4), (5), and (11) of section 1 of the bill, which represents the objectional coverage paragraphs.

Senator JOHNSON of Colorado. Now, Senator Hawkes has a witness that he would like to have appear.

Senator HAWKES. Mr. Seward H. Jacobi.

Senator JOHNSON of Colorado. Proceed in your own way, Mr. Jacobi.

STATEMENT OF SEWARD H. JACOBI, SECRETARY, SOCIAL SECURITY COMMITTEE, NEW JERSEY STATE CHAMBER OF COMMERCE

Mr. JACOBI. My name is Seward H. Jacobi. I am secretary of the social security committee of the New Jersey State Chamber of Commerce and make this statement on behalf of the chamber's committee.

Since 1935, when our social-security committee was organized, the committee has actively participated in the development of socialsecurity legislation in New Jersey. We recently participated in the liberalization of the State's workmen's and unemployment compensation laws, and we are now undertaking a State-wide study of sickness and health insurance.

Senate bill 293 seeks to liberalize and broaden the coverage of the Railroad Retirement Acts and the Railroad Unemployment Insurance Act. On the basis of studies made of this proposed legislation and the conditions giving rise to it, the New Jersey State Chamber's Social Security Committee has arrived at the following conclusions:

First: Insofar as the liberalization of the acts is concerned, we agree that the proposal to include surviors' benefits is meritorious because survivors' benefits are provided for under the Social Security Act. By the same token we submit that an employee of a railroad company earning X dollars for a given period of time should not receive greater benefits than an employee covered by the Social Security Act under similar circumstances. As to sickness and maternity benefits, we respectfully suggest that action with reference to the provisions of the bill covering these subjects should await the report of the intensive studies now being made by the special congressional technical staff. This does not mean to imply that under proper conditions we are opposed to provisions for sickness and maternity benefits.

Second: The coverage under the present Railroad Retirement, Unemployment Insurance, and Carriers' Taxing Acts was designed to be the same as that under the Railway Labor Act, with only a few additions such as demurrage bureaus, traffic associations, refrigerator car lines operated by rail carriers, other similar activities owned or controlled by railroads and performing a part of railroad transportation, and railroad labor organizations. Proponents of the bill assert that its coverage provisions are in the interests of clarification and simplification. They would have neither effect. The new coverage would open up a new field of controversy and litigation. For 7 or 8 years, since the railway acts have been in effect, there have been much time and litigation devoted to coverage. With provisions like paragraph (4), on pages 2 and 3 of the bill, it is a certainty that employers under the Social Security Act who ship or receive or handle goods or materials transported by railroads will be called upon to appear before the Railroad Retirement Board and to submit forms and information relating to the activities of some of their employees. Confusion and discontent are inevitable if the several pages in S. 293 devoted to the definition of an employer are approved by the Congress. If coverage of the railroad acts is to be broadened, would it not be much simpler to repeat the provisions of the present railway acts relating to who are employers and then add, clearly and specifically, the additional employers sought to be covered? If such coverage is not most clearly and definitely defined, many employers and employees now covered by the Social Security Act may find themselves under the railroad acts, the Social Security Act, or both.

However, the New Jersey State Chamber's Social Security Committee is strongly opposed to any extension of coverage in the railroad retirement acts and the Railroad Unemployment Insurance Act until the Congress has had an opportunity to consider the report of the special technical committee now in the course of preparation. Senator JOHNSON of Colorado. Thank you, sir.

Senator Hawkes, do you have any questions?

Senator HAWKES. No. I think the statement speaks for itself. It is the first time I have seen it. I am very glad you have had the opportunity to present it.

Senator JOHNSON of Colorado. All right.

Now, I have a request by Mr. Maitland Pennington, secretarytreasurer of the National Federation of American Shipping, which has offices at 1341 Connecticut Avenue NW., Washington, D. C. Mr. Pennington, I understand, is unable to be here, and asks that the statement be made a part of the record. If there is no objection, that will be done.

(The statement is as follows:)

STATEMENT OF MAITLAND PENNINGTON, SECRETARY-TREASURER, NATIONAL FEDERATION OF AMERICAN SHIPPING, WASHINGTON, D. C.

Mr. PENNINGTON. My name is Maitland Pennington. I am secretary-treasurer of the National Federation of American Shipping, which has offices at 1341 Connecticut Avenue NW., Washington, D. C.

The National Federation of American Shipping has as its membership the five principal steamship associations of the United States: .The American Merchant Marine Institute, the Association of American Shipowners, Pacific American Steamship Association, Shipowners Association of the Pacific Coast, and Pacific American Tankship Association. These five associations, through the National Federation of American Shipping, represent more than 95 percent of the ships owned by American citizens.

It is our opinion that Senate bill 293 contains provisions which extend the scope and application of the Railroad Unemployment and Railroad Retirement Acts in such a broad manner that it will embrace many of the activities of the members of this association, as well as stevedoring companies and terminal companies who are employed solely by members of this association.

The provisions of section 1, as of this bill, are in such form that we are unable to determine the exact extent of the coverage.

However, we direct your attention to the fact that in section 1 (a) (2) it seems clear that anyone who engages in the handling of service and cargo which is to be transported in part by railroad carriers would be embraced within its terms. Thus, stevedoring, terminals, and warehouses operated incident to steamship operations would appear to be covered.

Section 1 (a) (3), in redefining freight forwarding, appears to include within its terms all of the activities of terminal companies. Section 1 (a) (4) very well can extend the application of these laws to certain steamship companies who render transportation services of a character identical or similar to that given by railroads.

It would seem from other provisions of section 1 that even steamship service may be subject to the proposed act to the extent that it performs contract carrier service for railroad passengers, shippers, or consignees pursuant to or in connection with any arrangement with a carrier subject to the Railroad Retirement Act. It is obvious that these amendments would be against the interests of steamship operations and affiliated activities.

The employees participating in these operations, which according to S. 293 may be part of a railroad transportation contract, an employee of a steamship operator or of a prime contractor to a steam

ship operator, and in no sense can their activities be considered as having any relation to the functions of the employees covered by the Railroad Retirement Act. This group of employees have collectivebargaining agreements with steamship operators and employers who perform services solely for steamship operations.

Under the terms of this bill we are certain that thousands of employees would find themselves in the unusual and undesirable position of having to contribute to four funds: The Railroad Retirement Fund and Railroad Unemployment Fund for any work which might come under the purview of Senate bill 293, and to the Federal Öld-Age Fund and State Unemployment Insurance Funds, for that portion of the work which is not covered by Senate bill 293. Employers would find it necessary to make payments to and keep records for four agencies covering the same employment.

Furthermore, steamship operators are not anxious to have unemployment insurance and retirement programs regulated by a board which is dominated by one of their competitors, railroad management and railroad labor determine the policies for the administration of railroad retirement and unemployment insurance funds.

It has long been the policy of Congress to keep steamship companies and railroad companies segregated on general legislation. It is, therefore, respectfully suggested if it has been proper to keep railroads and steamships segregated in general legislation, it should also be the policy of Congress to keep them segregated in social legislation.

We would appreciate the opportunity to submit a brief on this measure at a later date. The water-front employers of the Pacific coast and numerous other maritime groups join with the National Federation of American Shipping in its objections to Senate bill 293. Senator JOHNSON of Colorado. Now, Senator Hawkes and others, if there is no objection we will recess until 2 o'clock.

(Whereupon, at 12:30 p. m., a recess was taken until 2 p. m. of the same day.)

AFTERNOON SESSION

The committee reconvened at 2 p. m., upon the expiration of the

recess.

Senator JOHNSON of Colorado. The committee will come to order, please. Mr. Fort, until Senator Hawkes gets back we will hear some of your 5-minute speakers.

Mr. FORT. Yes. Senator, those short witnesses, of course, over whom I have no control

Senator JOHNSON of Colorado. Do you have any of them here?

Mr. FORT. There doesn't seem to be one here right now, but I think there will be in a minute or so.

Senator JOHNSON of Colorado. All right.

Mr. FORT. There was one little bit of confusion about two: I don't think they thought they were going on right away, and we shall wait just a couple of minutes, and if some of them show up we shall go ahead.

Senator Hawkes is back; he will be in in just a minute. He just went down the hall, and we can put Mr. Brown on.