Mr. Speaker, I ask for ten minutes in which to address this House in protest against the kicking around which this Government has given to many of my fellow veterans of World War II, who are engaged, or rather trying to engage, in the business of carrying cargo by air.
I will begin, Mr. Speaker, by pointing out that the United States Government has an extremely strong interest in encouraging the development of a fleet of freight planes. The Secretary of the Navy has testified before the Armed Services Committee of the Senate that the Russians now have more than two hundred and fifty operating submarines – which is five times the submarine fleet with which the Germans started World War II. And, far more dangerous and far harder to locate than were those which baffled our Navy and Air Force for such a long time in World War II.
We therefore can no longer place our sole reliance upon ocean vessels. We must be able to fly over the enemy navy. Furthermore, if there is any truth in what General Eisenhower has told us – that the next war will be won or lost in the first sixty days – then we certainly cannot rely upon supply lines which move at only 16 knots. We must have supply lines capable of keeping up with the seventy Air Force groups voted by this House last week. Therefore, Mr. Speaker, I submit that this Government has a very strong interest in building up a fleet of cargo planes without any further delay.
However, when we look at our present commercial air transport fleet, we are confronted with a very sad case of unpreparedness. The airlines which have been given certificates by the Civil Aeronautics Board possess and operate only about sixty freight planes, of which only about twenty are really capable of crossing the ocean. However, quite a group of veterans of World War II, when the war ended – and I remind this House that V-J Day occurred more than two and a half years ago – returned home with a desire to apply to our peacetime commerce those talents which they had acquired in war: the ability to fly an airplane and the familiarity with moving large quantities of freight by air. Many of these veterans, with their own money and that of their friends and relatives, bought surplus cargo planes from the Government, formed companies, started in business, and applied to the Civil Aeronautics Board for Certificates of Convenience and Necessity to operate regularly and in a big way.
The shameful thing, Mr. Speaker, is that during the last two and a half years not a single one of these veterans’ air freight lines has been granted a certificate by the Civil Aeronautics Board. Lacking a certificate, these veterans have been permitted to operate only under adverse and restrictive conditions and have found it difficult to borrow money from private banks. Many of them have been forced into bankruptcy, a fact over which the President of one large certificated passenger line gloated in a recent testimony before the Civil Aeronautics Board:
"Not long ago, I believe, you could read in the paper that there were somewhere close to one hundred companies engaged in that (air freight) type of service and that has now diminished to a handful."
The Civil Aeronautics Board has not only been shamefully slow in handling the applications of these freight companies – the very type of company which this country needs for national defense – but they have failed to remove the obstacles which have been put in the way of these veterans.
Last fall, the big certificated passenger airlines filed freight rates as low as 13 cents a ton-mile, which the CAB permitted to go into effect over the protest of the independent freight carriers. After another cut and another protest the CAB finally ordered an investigation, which is still pending. The veterans have charged that these new tariffs were designed solely to undercut them, and since the new rates were way below cost, they were apparently designed to crush and eliminate the remaining veterans who started this new air freight business.
The President has recently appointed a new Chairman of the Civil Aeronautics Board, and one new member, and a third new member is slated to come before the Senate for confirmation. While the new Board has just made a tentative decision in the Air Freight Rate Case, it is yet too early to tell whether or not it will bring much relief to the veterans who are suffering from the rate-war. We can only hope that in the future the Board will be considerably more enlightened on the subject of air cargo than it has been in the past.
We are all familiar, Mr. Speaker, with the tactics of big companies in certain fields other than air transportation, in starting a rate-war for the purpose of crushing small competitors who do not have sufficient financial resources to last out such a rate-war. The basic unfairness of this situation is highlighted by another recent development.
Only last week, Mr. Speaker, enormous subsidies in the form of mail pay were granted by the CAB to the certified lines. This move, Mr. Speaker, amounts to the Government using the taxpayers’ money to finance those who are trying to crush the veterans’ air freight lines - at the very time when, for defense purposes, we should be encouraging them all we can. And it is certainly odd, Mr. Speaker, that the CAB is establishing air mail rates for the "Big Five" airlines – which they call "service rates" – which are 5 times the rates they have approved for cargo!
These veterans' air freight lines have among them some one hundred and twenty-five freight planes, and it is my opinion, Mr. Speaker, that the able operators among them should be given certificates by the Government as quickly as possible, so that these freight planes may be added to the fleet we so badly need for national security. They will do all right in business – in fact, until this rate-war was permitted last fall, these veterans air freight lines were operating in the black, which is more than can be said for nearly all the big passenger lines. These veterans' air freight lines have carried more traffic than the certificated lines. They have done it entirely on their own – and without subsidy from the Government. It is my firm belief that they fill an important need in the inter-state and foreign commerce of this country. These veterans desire fair play and I announce at this time, Mr. Speaker, that when the appropriation bills for the payment of airmail subsidies and any other legislation affecting them reaches the Floor of this House, I am going to see that they get fair play.
Source: David F. Powers Personal Papers, Box 29, Folder: "Veteran's Air Cargo Lines, Washington, DC, 28 April 1948." John F. Kennedy Presidential Library.