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It gnaws insidiously at our competitive position and ultimately destroys the very jobs it seeks to protect-both for railroaders and all those who depend on railroad purchases.

So I say that for the good of all America, something drastic must be done about this destructive growth. And 1959 is the year of decision. A 3-year-old agreement to postpone revisions in working rules expires on October 31. This poses great opportunity for both labor and management to break out of these chains to the past.

But let me bring this subject down to specifics and show what featherbedding really is. The practice is concentrated among certain classes of train operating positions, which account for about one-fourth of total employment. The three most damaging areas are as follows:

First is the antiquated mileage-day pay system which siphons off virtually all the benefits from modernized motive power and stepped-up train speeds.

Second are the towering jurisdictional walls that stand rock-hard in the path of streamlined service-the claim-to-work rules that ban road crews from working in yards and bar train crews from crossing district and seniority boundaries. Third are the senseless requirements for useless crewmen on trains and other equipment-for firemen who tend no fires and extra brakemen who handle no

brakes.

The dual mileage-day pay standard is itself a glaring anachronism. While modernization sweeps ahead throughout the railroad structure, this 40-year-old work rule clings like a leech to the carriers' body, draining away its lifeblood. Simply stated, it provides that when locomotive and freight-train crewmen cover 100 miles, they must get a basic day's pay. Passenger trainmen put in 150 miles. One doesn't have to be a railroad expert to see what is wrong with such a system. When standardized in 1919, it had a perfectly reasonable basis. That was the day of the plodding steam locomotive, the model T and the wheezing biplane. A run of 100 miles in freight service did indeed take about 8 hours' time. And a run of 150 miles in passenger service required 71⁄2 hours.

But those times are now ancient history. Along came great improvement programs-streamlined diesel locomotives, electronic traffic-control systems, faster rolling stock and straighter, freer right-of-way. Freight and passenger train speeds nearly doubled.

Yes, railroading changed as all America changed, but the old rules did not. They remained as inflexible as a rock. And the modernized iron horse remained tied to a 1919 hitching post.

Employees on passenger and through-freight trains found themselves completing runs in up to half the time formerly required. On some of the choice "red apple" runs where train speeds exceed 75 miles an hour, a basic day's wages are earned in less than 2 hours.

Look briefly at what happens when train speed rises within this fixed workrule frame. A passenger train now covers the 900 miles between New York and Chicago in about 16 hours. But the railroad by no means pays just 2 days' pay for the engineers' services. No; the carrier must pay over 9 basic days' pay for each crew position on the 16-hour run. Or move on westward to another fast run. A train covers the 1,034-mile trip between Chicago and Denver in 161⁄2 hours. Again, the payout is not for 2 days' pay, nor even for 9. The carrier's costs equal a total of 10% basic days' pay for each engine-crew position. By contrast, a busdriver generally works a full 8 hours for his day's pay.

This system is so self-destructive that I doubt if one could have devised anything more likely to kill off its practitioners. As railroads step up train speeds and streamline service, these restrict-the-work rules rake off virtually every dollar of benefit that results. Little remains for other employees-and nothing remains in the way of price reductions for customers and dividends for shareholders. Modernization thus carries a built-in penalty. It becomes a curse instead of a blessing.

How long can the railroad business withstand such bloodletting? How long can the great majority of rail employees tolerate such obstacles to their own advancement? How long will our customers countenance accompanying uppressures on our prices? The future of this vital industry rides on the answers. At the same time revision is made in the old dual pay system, something must also be done about the rigid lines drawn between the kinds of work each group of employees will do. These separations hit the railroads and the general public especially hard because they pose invisible blocks on what should be a free and open track. For instance, we generally cannot run one train crew through

a division change point, because rules say that employees within each walled-in division have the right to man all trains in that area. This may have made sense when steam locomotives covered only 100 miles or so and took a crew's entire workingday.

But it makes no sense now. That New York-Chicago passenger train I cited awhile ago has to stop and change engine crews seven different times along the way. That Chicago-Denver run requires eight different engine crews, each putting in an average of about 2 hours. And think what time is lost changing crews and cabooses on piggyback and hot-shot freights. The system practically invites competition, not so burdened, to nibble away at our traffic.

High walls also loom between road and yard crews, with each forbidden to work in the other's domain except at grave penalty to the railroad. This can even lead to a railroad's paying three times to get one thing done. For example, in one referee's interpretation of the rules, a yard employee was awarded an extra day's pay for working a few minutes on line outside the yard limit, while a road employee got a day's pay for work he did not do but claims he should have done. That's 3 days' pay for one task-2 for the yardman, 1 for the roadman.

In another instance, the rules forced payment of an extra day's pay to a road freight engineer for moving his train a few car lengths in a freight yard-the job claimed under the work rules to belong to a yard engineer.

A yard crew making a 4-mile round trip to help a freight train through snow got extra pay for 100 miles of road service.

Can you think of a faster way to go broke? How long can the Nation's economy bear such a deadly drag? Here is a system geared to inefficiency and bungling, to delays in moving your shipments, to the most indefensible waste. We cannot continue to carry such a backbreaking load. And neither can you or the public.

Now look for a moment at that classic featherbedding rule-one which places unneeded men on trains just for the ride-excess baggage which displaces and preempts the jobs of truly essential railroaders. Hoary-headed, coal-burner rules still require an inflated number of men on trains and self-propelled passenger cars and work equipment. These surplus men may have been truly needed long ago, but no more.

The position of diesel firemen is a case in point. They once shoveled mounds of coal into giant steamers and were among the hardest workers on the railroads. Now, as stated by the neutral members of arbitration case 140, "the change from steam to diesel power left little or nothing for the fireman to do." Canada has demonstrated the high statesmanship required to deal with this problem. When negotiations on the status of firemen reached a deadlock between the Canadian Pacific Railway and the firemen's brotherhood, the Government appointed a royal commission of outstanding Canadian citizens to investigate. After months of study and hearings, the commission handed down its historic decision just a little more than a year ago. It found the fireman's position on diesel engines in either freight or yard service wholly unnecessary. At that stage of the controversy, no other classes of service were a part of the disputed issue.

The fireman's functions, the commission concluded, "have either totally disappeared, as in the case of the production of power, mechanical assistance and inspection, or are a mere duplication of what is discharged by another or others, as in the case of the lookout functions performed by the headend brakeman and the engineman."

The commission, significantly, was not impressed with arguments that firemen are necessary for safety reasons. It made on-scene studies of train operations without firemen on this continent and in Europe and found their safety experience comparable to operations with firemen. I might add that overall railroading is no different here from the system across our northern border. Canada has shown the way toward truly modernized train employment. The lagging United States can do no less than catch up.

The telling burden this type of "make work" imposes on the industry can be measured in the annual cost of unnecessary firing jobs on U.S. railroads. This amounts to more than $200 million. Rules and regulations forcing use of other

unneeded men bleed off another $90 million.

Imagine for a moment how much savings of that magnitude would mean to the public in the way of healthier railroads, more purchases, and supplier jobsand more jobs on the railroads themselves as they get back on their feet.

Now all I have said up to this point proves just this: Even the most reasonable work standard must in time become wholly unreasonable unless improved and tailored to match changing conditions. And no one can deny that revision is long overdue in railroading. That fact has been attested to by the highest authorities who have investigated the problem, including representatives of the Congress, Presidential emergency boards, the Interstate Commerce Commission, and State regulatory bodies. It is also significant that enlightened labor leaders in almost all other segments of industry recognize that job-output standards must keep pace with changes in technology and employee performance. Actually, fair reassessment and revision of these ancient work standards are all the railroads seek. Our goal boils down to this simple, reasonable objective: A fair day's work for a fair day's pay.

If we can attain this goal, and if we can couple it with forceful effective action on the public-policy scene, we will be on our way to a wholly new era in railroading, a new era of vigorous and lusty service to our growing America. What we do now can mean final recovery of the iron horse from its chronic sickness. I don't mean just halfway recovery to another limping in-between stage but all the way, to full strength and new growth. This hard vision and practical promise are ours if we will but reach out to seize it.

Let me also add a strictly personal comment. I did not become president of the Association of American Railroads to nurse this proud industry through its last illness. Railroads remain critically ill, but they have started on the road back and they have strong leadership throughout the country which is determined on a program of affirmative action to cure their ills. We are not going to be content with halfway measures. And we shall seek the help of all individuals and groups with the good sense to see what is at stake in this great effort.

Now I want to make one point crystal clear. I am not attacking railroad labor. There is no more able or conscientious work force in any industry in the Nation. I am, however, attacking and condemning the deadly rules our workers must work by-rules which limit their creative ability and their output and detract from their dignity; rules which are thoroughly un-American in concept and economically destructive in practice.

If railroad labor leaders were with us today, I would plead for them to join us here in forging this new era of growth and greatness. A half-million railroad jobs have been lost in the last dozen years. Unless we solve our internal and external problems, more thousands of jobs will go down the drain. No labor leader wants that. And neither does any railroad official.

So I urge our brotherhoods to act with us to help reverse this disastrous trend. Let's wine out featherbedding. Let's stop paying men for work they don't do. Let's stop dissipating our lifeblood in frustrating clashes over rules everyone recognizes as unsound and unfair.

Let's stop arguing over who will get the biggest share of a reeling industry's dwindling income and turn our eyes and hearts to ways to regain strength, expand business, and divide the fruits of new-found prosperity.

To our workers, I say, this is your great hope for the future. It is your only hope. It is also America's great hope to get the strong railroads it needs for the normal demands of commerce and the unprecedented demands of war emergency. Let me illustrate this overriding public interest in wiping out featherbedding with just two specifics:

First, the peace of the world-and the continued freedom of our own country and all other free nations-is utterly dependent today on the continued strength and resources of America. The military mobility of our Nation, in event the cold war ever suddenly flares into a hot war, is of transcending importance.

In World War II the railroads were called upon to handle over 90 percent of military freight and 97 percent of all organized movements of military personnel. This is an achievement of which all of us in transportation have a right to be proud. But we must also be deeply disturbed over the fact that the railroads do not now have the equipment and capacity to handle the military passenger volume imposed on them in the last war. It is also a blunt fact, which we cannot afford to ignore, that under the conditions of World War II, highway and air transport would be entirely inadequate to carry the load. Reliance would have to be placed on the railroads. Full recovery of the railroad industry is of paramount security importance to the American people.

Second, President Eisenhower, in his annual economic message to Congress last month, called for an all-out national campaign to halt inflation. He warned that the United States can become increasingly prosperous only if it holds the line against price increases, and called upon labor, businessmen, and consumers to join the Government in a drive to achieve "inflation-free, sustainable growth." Wage gains that outrun increases in industry's productivity were singled out as a primary cause of higher prices.

The elimination of half a billion dollars a year in wholly nonproductive makework and featherbedding in the railroad industry would represent a tremendous contribution to the fight against inflation. For nothing is more inflationary than pay for work not done, for services not performed, for goods not produced. Featherbedding goes hand in hand with the high and rising cost of living.

Then we must recognize still a third and more pressingly immediate symbol of the public interest. In these times of upheaval, America cannot afford the luxury of labor-management discord in a vital industry. Nor can it tolerate work stoppages and the inexorable grinding down of the economy that would come if train wheels stop turning.

The Nation has just emerged from serious trouble resulting from strikes in air transportation. I do not belittle that trouble when I say that what we have seen is but a token of the economic disruption and personal hardship a railroad tieup would bring. So while we seek labor's earnest cooperation in preventing full-scale crisis, we cannot bury our head in the sand. It is time to face up to the possibility of tieup-and time to take forthright action to make sure it does not happen.

I, therefore, propose this first step toward solving the problem of featherbedding on the railroads: That leaders of the train-operating brotherhoods join with railroad management in asking President Eisenhower to name a nonpartisan group of distinguished citizens to study this whole question.

Such a special commission should go to work immediately, well in advance of any transportation crisis, preparing an independent and objective appraisal that will protect the welfare of our country, the solvency of the railroad industry, and the security of its workers.

We all recognize what exceedingly heavy burdens are carried by the President, and none of us would unnecessarily add to these responsibilities. We feel, however, that our urgent request is justified because of the transcendent national significance of a sound solution to the featherbedding problem.

Accordingly, I am sending today a letter to the leaders of the operating brotherhoods, asking them to join with me and other railroad executives in requesting Presidential action on a commission. Labor can do the Nationand itself no greater service than to join us now in seeking the Government's help in laying a basis for sound, new work standards in the railroad industry. The job of breaking the featherbed chains around our industry is going to be the most difficult labor issue ever faced in railroading. Both the brotherhoods and management need help. And we cannot shrink from seeking it. The American people themselves have too much at stake on the outcome. Only through the wholehearted cooperation of management, labor, and public leaders can we hope to free the Nation from the wastes of featherbedding and from the multiplying penalties of a weakened industry.

In closing, let me say again to you shippers and to all America that railroadmen know only too well that the road back for our industry is a rugged onebut we intend to leave nothing undone to regain our place as a dynamic, progressive business. During the months ahead when this crucial issue is being decided, we will need your warmhearted support and understanding. In return, we will express our gratitude in the one way you will understand best-in the rebuilding of a great industry, in new achievement and in new benefits for all the Nation.

Senator MORSE. In the last issue of the Traffic World-I was looking at it last night-there is some reference to the problem. It will be placed in the record at this point. And I am probably going to refer to that in some of our executive sessions.

Mr. LOOMIS. That will be a pleasant surprise.

37456-59-12

(The article referred to follows:)

[From the Traffic World-"The Week in Transportation," Feb. 14, 1959] RAILROADS AS FIVE "OPS" TO JOIN IN MOVE FOR SOLUTION OF "FEATHERBEDDING" PROBLEM

ADDRESSING SHIPPER BOARD ASSOCIATION, D. P. LOOMIS, HEAD OF AAR, PROPOSES CREATION BY PRESIDENT EISENHOWER OF COMMISSION TO STUDY MAKE-WORK RULES THAT ADD OVER $500 MILLION A YEAR TO RAIL COSTS

Daniel P. Loomis, president of the Association of American Railroads, announced in a speech in St. Louis, February 11, that he was dispatching, that day, a letter to the leaders of the rail-operating employee unions asking them to join with him and other rail executives in requesting the appointment by President Eisenhower of a special commission to study "the wasteful and burdensome work rules, commonly known as featherbedding."

In a press release about Mr. Loomis' speech, which was delivered at the convention of the National Association of Shippers Advisory Boards, in the SheratonJefferson Hotel, the Association of American Railroads described Mr. Loomis' proposal as the first step taken by railroad management to rid the railroad industry of "make-work featherbedding practices which cost the public more than $500 million annually."

After calling "featherbedding" a "destructive growth" which "gnaws insidiously at our competitive position and ultimately destroys the very jobs it seeks to protect-both for railroaders and all those who depend on railroad purchases," Mr. Loomis said that 1959 was "the year of decision" with respect to the featherbedding problem, since a 3-year-old agreement to postpone revisions in working rules would expire on October 31.

Transportation and new hope

Before taking up the subject of "featherbedding," Mr. Loomis said it was not his purpose to dwell on the railroads' problems, but to "hold out new hope of recovery for a seriously afflicted industry-new hope for a brighter day in transportation for Americans everywhere," Continuing, he said:

"I hold out hope of healthy and vigorous railroads, making rising contributions to the Nation's economic vitality and national security, and spreading greater prosperity outward to all businesses and to all America. * * *

"If you are tired of hearing about railroad troubles, I can assure you that the railroads are tired of telling you about their troubles. We are sick of being the problem child of the American economy. But let's be realistic. Let's all-everyone, everywhere get sick and tired for once over the causes of those troubles. Let's come to grips with those causes.

"We ask for your help

"Only then can the railroads regain their rightful place in the national economy. And by that, I don't mean rising from a sickbed to a wheelchair. I mean becoming a healthy, vigorous, progressive, railroad industry again, making the vital contributions to an expanding America that our citizens have a right to expect. The railroads intend to fight toward that goal. And we ask for your help and the help of all thoughtful Americans.

"The results will be worth the effort. Railroads have woven a marvelous new pattern of facilities out of a postwar investment of $14 billion. This private capital spending, made in the face of the most forbidding obstacles, has changed the face of railroading and provided greatly improved service at low costs for producers, consumers, and the whole country.

"Yet this is only the beginning. Modern railroading has enormous undeveloped potentials. Given a real chance to earn a decent living and rise to their full potentials, the railroads can and will give the Nation wonderful new levels of streamlined service and provide a vibrant nucleus for a dynamic American economy

**

Public policy problems

Then, after touching on the "start" he said had been made toward solution of rail problems through passage of the Transportation Act of 1958, and on current railroad attempts to obtain solution of such "public policy problems" as subsidy and promotion of competing carriers, Mr. Loomis delved into his discussion of "featherbedding," as follows:

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