It is inconceivable that the Commission would in the future, as result of Congress not passing this restrictive legislation, breach these

assurances.

It is the opinion of our Commission that if the Congress believes that the Commission is competent to decide what persons should be permitted to enter into interstate transportation on the highways as common carrier and contract carriers, the rates which they may charge, the amount of insurance which they must carry and the safety regulations which they are required to observe, then there can be little justification for Congress to believe that the Commission is not competent to establish the practices which will insure that those carriers themselves perform the authorized transportation. The consequences of such legislation, if enacted, will, in the judgment of the Commission, inevitably contribute to the deregulation of motor-carrier transportation.

Senator SMATHERS. All right, sir. Thank you very much. Senator Schoeppel, do you have any questions?

Senator SCHOEPPEL. No; no further questions; thank you.

Senator SMATHERS. Let me get clarification on one point, Mr. Cross, which I am not clear about now. This effective date of March 1, 1956, was on this exception; was it not? In other words, you agreed to postpone the original order and then later on the postponement was delineated and refined until March 1, 1956?

Commisioner CROSS. That is right. That was because we reopened the original proceeding that is MC-43-which had been heard by the Commission a number of years ago, which was the matter which was taken by appeal to the Supreme Court of the United States, sustained by that Court, and then came back.

We have never put into effect these two matters that have to do with the 30-day leasing provision and the matter of the division of revenues on a percentage basis. Those rules from time to time have been postponed.

The MC-43 proceeding was reopened. Rehearings were conducted. New testimony was introduced to bring the record down to date, and oral argument has been heard before the entire Commission in that proceeding. That was some time ago.

Senator SMATHERS. As I understand your testimony today, what you are saying is that even if this Congress does not adopt this legislation or something like it, that it is not the intention of the Commission to ever attempt to limit trip-leasing contracts to a 30-day period or more than a 30-day period or limit them in any way; is that correct?

Commissioner CROSS. So far as the movement of agricultural commodities is concerned as defined in this law.

Senator SMATHERS. That is right. In other words, on the original trip up, of course, they are exempt, but on the trip-lease coming back as defined by your rule there would be no attempt

Commissioner CROSS. There would be no attempt to modify that rule. That rule is simply this: that an exempt movement of an agricultural commodity from any part of the country can be completed, and upon completion of that movement the owner of that unregulated vehicle can make a trip-lease with a regulated carrier for one movement in any direction.

inconceivable that the Commission would in the future, as of Congress not passing this restrictive legislation, breach these

s the opinion of our Commission that if the Congress believes he Commission is competent to decide what persons should be itted to enter into interstate transportation on the highways as on carrier and contract carriers, the rates which they may charge, mount of insurance which they must carry and the safety regus which they are required to observe, then there can be little ication for Congress to believe that the Commission is not competo establish the practices which will insure that those carriers selves perform the authorized transportation. The consequences ch legislation, if enacted, will, in the judgment of the Commisinevitably contribute to the deregulation of motor-carrier transtion.

nator SMATHERS. All right, sir. Thank you very much. Senator eppel, do you have any questions?

nator SCHOEPPEL. No; no further questions; thank you. nator SMATHERS. Let me get clarification on one point, Mr. Cross, I am not clear about now. This effective date of March 1, was on this exception; was it not? In other words, you agreed stpone the original order and then later on the postponement was eated and refined until March 1, 1956?

mmisioner CROSS. That is right. That was because we reopened riginal proceeding-that is MC-43-which had been heard by the mission a number of years ago, which was the matter which was by appeal to the Supreme Court of the United States, sustained at Court, and then came back.

e have never put into effect these two matters that have to do the 30-day leasing provision and the matter of the division of mues on a percentage basis. Those rules from time to time have postponed.

he MC-43 proceeding was reopened. Rehearings were conducted. testimony was introduced to bring the record down to date, and argument has been heard before the entire Commission in that eeding. That was some time ago.

enator SMATHERS. As I understand your testimony today, what are saying is that even if this Congress does not adopt this legison or something like it, that it is not the intention of the Comar attempt to limit trip-leasing contracts to a 30-day an a 30-day period or limit them in any way; is that

s. So far as the movement of agricultural comdefined in this law.

at is right. In other words, on the original
exempt, but on the trip-lease coming back
ould be no attempt

would be no attempt to modify that
: that an exempt movement of an
I part of the country can be com-
at movement the owner of that
lease with a regulated carrier

In other words, in a movement from Florida to Philadelphia of fresh citrus fruit, upon the competition of that, that carrier could make a trip-lease with a regulated carrier that would take him to Chicago or Boston or any place in the country; and from there he would be at liberty to make a series of trip-leases in the general direction of his home base.

Senator SMATHERS. In other words, he could trip-lease for machinery, we will say, to Omaha, and presuming Omaha is south of the place where he ended up with the agricultural load.

Commissioner MOORE. If Omaha was still in the general direction of his home base, he could go that way, but he could not go in a series of movement all over the country.

He would have one movement free in any direction. In other words, he could go to Chicago and from Chicago he could make a trip-lease to Louisville and from Louisville to Atlanta and from Atlanta back to Jacksonville, Fla.

Senator SMATHERS. In other words, we will say, from Louisville to Jacksonville and from Jacksonville to Miami-those trips would be the subject of separate leases?

Commissioner CROSS. Yes, sir; a series of separate trip leases.

Senator SMATHERS. On this matter of a definition of what are agricultural products, somebody pointed out here the other day about dressed chicken and they pointed out a couple of items which would appear certainly-and I will call myself a layman in this instance to be somewhat inconsistent.

For example, I think the question was in the eighth circuit. The Commission had taken the position that dressed chicken was not an agricultural product. I think the court ruled that it was an agricultural product, and, therefore, in that circuit, dressed chicken was considered to be an exempt item. Outside of that particular circuit, you people apparently retain the rule that dressed chicken is not an agricultural product, and, therefore, not entitled to an exemption.

Commissioner CROSS. That is an interpretation which, I believe, the courts place upon the jurisdictional scope of those decisions. When the Supreme Court finally passes on it, of course, that is binding.

May I add this: It is not the desire of the Commission to continually flout the decision of any court, but if the precedent became established in a series of intermediate court decisions, the Commission would probably accept that.

We frequently have that. We have one case now involving the same issue, the same decision of the Commission, where one Federal court held one way and another court held another way.

Senator SMATHERS. But do you have any other court decisions that say dressed chicken is not an agricultural product?

Commissioner CROSS. I think there is a proceeding pending. Can you tell us, Mr. Blanning, whether there is a proceeding pending?

Mr. BLANNING. There is a proceeding pending, but the lower court held the same as the other lower court, and that is not before the United States Supreme Court.

Senator SMATHERS. I understood, as I gathered from some other witnesses who appeared here the other day in behalf of this legislation, that in the particular case which occurred in the eighth circuit, certiorari was denied.

Commissioner MOORE. That is right.

Senator SMATHERS. But is this a new case that has been started to fight that thing through?

Commissioner CROSS. There have been 3 cases in the lower courts, and 1 now is in the Supreme Court.

Senator SMATHERS. Did you say one of them now is in the Supreme Court?

Commissioner CROSS. Yes; it has not been cited before the recess. Mr. BAYNTON. Commissioner, in the order itself, and the language you have been quoting

and is next being utilized by the authorized carrier in a loaded movement in any direction or in one of a series of loaded movements over reasonably direct routes in the direction of the general area in which the exempt movement originated, or in the direction in which the equipment is based

some of the earlier witnesses that are for this legislation were having trouble with the word "or" in there.

They felt the word "or" was easily interpreted as meaning they had one free trip after completion of their trip with the exempt commodities, or a series of trips back to their home base, but not as you testified, that they had the free trip anywhere and then the series in a general direction of their home base.

Commissioner CROSS. My interpretation is more liberal than that. If it required clarification to corroborate our position, of course, that can be done, because our position, as I say, gives them more freedom than this other interpretation would.

Senator SMATHERS. May I say, Mr. Cross, speaking only for myself, that I recognize there is a considerable problem involved in this whole matter, and I have discussed it with other members of the Commission from time to time.

I have also discussed this quite fully with members representing the farm community and the agricultural interests. I cannot help but believe there is some basis which can be arrived at which, I think, would fit the particular problem with which you are involved and at the same time meet the problem with which they are involved.

I think we are approaching it, and very frankly I am very much encouraged by your testimony today.

Commissioner CROSS. Thank you, Senator Smathers, and may I say that on the question of the division of compensation on a percentage basis, there seems to be little dispute left by the agricultural groupsor at least so far as the Department of Agriculture is concerned-and the position of the Commission.

Certain carriers feel that to be prevented from dividing compensation on a percentage would be a handicap to them.

I would like to conclude my remarks by simply saying that, first, this Commission recognizes that it is an agency of the Congress, and that it will carry out its instructions.

Senator SMATHERS. We are very happy to hear that.

Commissioner CROSS. Certainly, there is no desire to in any way handicap the movement of agricultural commodities or those commodities which are described as exempt in the statute itself; and, third, there is no desire to handicap in any way the free and fair movement by carriers themselves engaged in the transportation of commodities under the authority of their certificate or permit.