The CHAIRMAN. Were the advances made by the State commissions at the request of the Interstate Commerce Commission, or what sort of communication was had between the Interstate Commerce Commission and State commissions that resulted in those advances?

Mr. BENTON. The carriers, after the decision in Ex Parte 74, proceeded in each State to file tariffs or to ask leave to file tariffs, in accordance with the laws of the respective States. Hearings were set and action was taken in regular form.

The statement as to the participation of members of the National Association of Railway and Utilities Commissioners, which I put into the record on yesterday, will show that under an arrangement made by the association the entire record in Ex Parte 74 was supplied to each State commission. Under explicit understanding had the National Association did not undertake to say whether that record would be introducible evidence under the law of a particular State or not; it was supplied for the information of the members of the State commissions for such use as the State commissions might see fit to make of it. I am not aware of the fact that in a single State were the carriers refused permission to introduce that entire record in the State proceedings for the purpose of facilitating the rate inquiries and the granting at the earliest prac ticable date of such advances as might be found to be necessary on intrastate rates. Obviously, unless that arrangement had been made, and unless the State commissions had desired to recognize to the fullest extent that justice required the situation then existing be met as promptly as they could, hearings could not have been set and held and decisions reached and orders made throughout this country within two months.

It has been sought to create in the public mind the idea that it was necessary for the Federal Government to step into the States and take away the power of State regulation which the States have had since the formation of this Government on account of unwillingness on the part of State commissions to recognize the situation and to do what justice and fairness required. Nothing could be more false nor farther from the exact state of affairs. And I want to say that this tabulation which I have put into the record, and the time within which those results were obtained, refutes that claim more conclusively than any words of mine or of anybody else could do, because no man who is at all familiar with the length of time that proceedings ordinarily take before State commissions, to say nothing of the time that is required to carry through proceedings had before the Interstate Commerce Commission, which is so much more burdened than the State commissions are, can fail to understand the significance of the record which these State commissions made following the Ex Parte 74 hearings.

A member of this honorable committee (Senator Townsend) on yesterday asked me whether the State commissions, in their actions, considered only the situation within their own States, and I said that I proposed to touch upon that subject later. I am now touching upon it. The sp rit with which the State commissions, in common meetings, provided for informing themselves quickly with respect to the situation, and of acting quickly upon applications made in their respective States, and the celerity with which they did act. prove, I say, as conclusively as it is possible to prove anything, that the State commissions of this country recognized the responsibility which attached to their offices, and viewed not alone the situation in their own States but the situation throughout the country.

The CHAIRMAN. You are speaking now of freight rates, of course?

Mr. BENTON. I am speaking of all rates, both passenger and fre'ght, and I am about to speak of passenger rates in particular.

The CHAIRMAN. Of course, there are some States in which passenger rates are fixed by statute.

Mr. BENTON. I am coming to that, Mr. Chairman.

The CHAIRMAN. If I understand your statement correctly, it is that in every State, save four, the State commisisons advanced rates in the same percentage in which rates had been advanced by the Interstate Commerce Commission in the matter of interstate business?

Mr. BENTON. Yes; with the exceptions I have mentioned. I have mentioned, for instance, Indiana, which advanced rates 333 per cent; Illinois, 35 per cent; Kansas, 30 per cent; Nebraska, 25 per cent; and Texas, 333 per cent instead of 35 per cent.

The CHAIRMAN. That is substantially the same advance as made by the Interstate Commerce Commission in the matter of interstate rates?

imposed on passenger traffic has destroyed the end for which it was designed; it has decreased the traffic to a greater extent than it has increased the revenues of the railroads.

The CHAIRMAN. You mean the surcharge that goes to the railroads thenselves?

Senator STANLEY. Yes; that increase goes to the railroads and not to the Pullman Co.

Mr. BENTON. All of the increase goes to the railroads.

Senator STANLEY. But no matter who it goes to, the question to my mind is whether this last increase in rate has not driven people from Pullman cars to the extent as to absolutely lessen the earnings of the railroads. It has played hob with the commercial traveler, and it is driving actors and opera troups almost entirely from the railroads because prices are prohibitive. I know what the public has suffered, and I think the railroads are suffering lessened earnings along with us who have to pay more for the service.

Mr. BENTON. As to the last Pullman increase, to which I understand you to refer, the imposition by the Federal commission of a Pullman surcharge of 50 per cent, it goes for the benefit of the railroad carriers.

Senator STANLEY. Yes; that is what I referred to.

Mr. BENTON. But the first increase which you referred to I assume to have been the increase which was allowed for the benefit of the Pullman Co. itself? Senator STANLEY. Yes.

Mr. BENTON. What the Senator from Kentucky (Mr. Stanley) wants and what I wish I could give him is exact data, figures, covering that subject. Those I can not give him, but I feel certain that if he will make request to the Interstate Commerce Commission they can be compiled and supplied to him.

Senator STANLEY. I am not criticizing the Interstate Commerce Commission. Mr. BENTON. I understand. And I feel certain you will get that information. Of course it takes time in any organization to compile data of that sort. Ultimately the Senator from Kentucky ( Mr. Stanley) undoubtedly will get that information.

I can only now express what my information is, as received from commissioners with whom I have talked. The information universally received from them is that the Pullman surcharge has been very destructive of travel upon Pullman cars. That accords with my own personal observation; in fact, since that surcharge went into effect the travel on Pullman cars has almost disappeared on many trains.

I came, a few weeks ago, from Chicago on one of the trunk lines, and from Chicago to Washington it is my recollection that there were only two people in the Pullman car besides myself. That is an experience of my own, as called for by the question of the Senator with respect to the effect on Pullman travel of the last increase.

Senator STANLEY. I do not mean to criticise the Interstate Commerce Com mission. They are usually very gracious and diligent in furnishing information, or especially that has been my experience, as requested by Members of the Senate. The question I asked may have been answered in these hearings, but I have not got the information. I thoroughly understand the effect of this last surcharge upon the business heretofore handled in Pullman cars; and in addition to its effect upon those who would otherwise travel is the great consideration, its effect upon the earnings of the railroads themselves. I can not help but doubt whether the railroads have not placed on the traffic more than it will bear and thereby lessened their own income, for they seem to have de stroyed, or practically destroyed, the greater part of this character of business. Mr. BENTON. I agree with what I take to be implied in the Senator's remarkthat it must entail a loss upon the rail carriers to impose so high a Pullman charge that they drive passengers from the Pullman cars, and, accordingly, are obliged to haul empty Pullman cars.

President JACKSON, of the National Association of Railway and Utilities Commissioners. I may say that I have personal knowledge of one or two railroads and I do not care to name them in the record, but they are big railroads in the United States-and I do not think the officers of those railroads desired the increase in pasenger fares to which reference has just been made. Senator FERNALD. That increase, of course, was authorized by the Interstate Commrce Commission, I take it.

Mr. JACKSON. Yes, sir.

The CHAIRMAN. It would depend somewhat, would it not, upon how many passengers ceased to travel and how many passengers were driven from Pull

man cars into day coaches, as to the situation which you mentioned, Mr. Benton?

Mr. BENTON. Of course, if the expense incident to hauling the Pullman car ceased when Pullman passengers went into the day coach, there would be no loss to the carrier. But if the carrier is obliged to haul a heavy Pullman car from Chicago to Washington, or from Chicago to New York, with only three passengers in it, that railroad can scarcely say that it has lost nothing because the pasengers rode in day coaches if it had to provide the necessary day coaches for them to ride in.

The CHAIRMAN. One would think under those circumstances a railroad would not carry any more Pullman cars than was necessary to handle the pasengers actually traveling.

Mr. BENTON. You are now getting upon a subject I can not answer because I do not know about the contracts between the Pullman Co. and the carriers. And, further, an answer to that question would depend upon whether the public would permit an entire cessation of Pullman service on important trains.

The CHAIRMAN. It is not that, but there is no contract between the Pullman Co, and the railroad companies requiring them to haul a particular number of Pullman cars over any particular road, is there?

Mr. BENTON. As I was stating. I have no information on that subject.

The CHAIRMAN. If there is no contract between the Pullman Co. and the railroad companies requiring them to haul any particular number of Pullman cars over any particular road, a railroad could reduce the number of cars hauled according to the amount of travel.

Mr. BENTON. I do not know whether there is such a contract or not. I have perer examined the contracts.

Senator STANLEY. At that point there is one phase of the situation that affects the public very materially: I understand that traveling men who forerly utilized sleeping cars in making long runs now stop at hotels along the tonte at night where they can stay for a couple of dollars and have quit using Pullman cars. The necessary result of that is that their efficiency is very ch impaired, and the cost of the service rendered by these commercial travters is increased, and that increased cost is added to the many burdens passed on the ultimate consumer.

Mr. JACKSON. I was going to call attention, if I may, to the fact that a great many trains have to be run anyway, whether they carry any passengers at all. In other words, a certain amount, a minimum service, has to be rendered the public. If those trains have to be run anyway, they are better off to carry five passengers at 3 cents a mile than four passengers at 3.6 cents a mile.

The CHAIRMAN. I would assume that if regularly or habitually there were enly two or three passengers on a Pullman car making the trip from Chicago to Washington or New York that a railroad would cut down the number of Fallman cars handled. But, of course, that might be a great inconvenience to the public at one time and another.

Mr. JACKSON. I might add that I do not think the railroads are carrying ywhere near the number of Pullman cars they were hauling. Mr. CLYDE M. REED, chairman of the Public Utilities Commission of Kansas. may be interesting at this point to put into the record some figures bearupon the statement Mr. Benton has made and concerning which the meme of the committee have asked. Passenger-train operation has a direct lation, of course, to the number of cars run; and revenue has a direct relato the number of passengers handled per car. In a statement which has t been issued by the Interstate Commerce Commission covering revenue affic statistics of Class I railroads in the United States it is shown that for first seven months of 1920 the average number of passengers handled per was 22.12.

The CHAIRMAN. That is, handled on all cars?

Mr REED. Yes, sir; that covers all cars handied. And the average number passengers per car for the first seven months of 1921 was 17.15, showing t not only has travel decreased but the number of passengers per car has ased, which I think covers the point mentioned by Mr. Benton.

Sonator STANLEY. My question was especially directed to the number of engers handled on Pullman cars.

The CHAIRMAN. That shows the diminution in travel, and I suppose it shows reduction in business handled beyond the capacity of the railroads to shrink er operating expenses.