Sen. Edward Kennedy (D-Mass.) brought his traveling deregulation show here yesterday in an effort to show that there is support in the Midwest for greater competition in the trucking industry.
Kennedy chaired hearings of his Judiciary Subcommittee on Antitrust and Monopoly here to listen to testimony from truckers, consumers and firms that ship their goods by truck as the center part of a whirmind resit visit to a Consolidated Trailways terminal followed by an early morning stop at aproduce mart.
The road show plan developed after trucking industry representatives told Kennedy's subcommitte in earlier hearings in Washington that there was no support "in the hinderlands" for deregulation. More hearings are scheduled in Denver today.
The heart of the deregulation proposals under the Interstate Commerce Commission staff are regional rate bureaus rub by the truckers themselves which fix frieght shipping rates for their members. The rates are subject ti ICC approval, but the volume of the rat applications - 5,000 daily - has placedkthe commission int the position of rubber-stamping, rather than reviewing, the requests.
The regional hearings come at a significant point in Kennedy's career. A champion of greater competition and (See TRUCKING, B9, Col. 3) (TRUCKING, From B7) deregulation, Kennedy had been unable to nudge Judicary Committee Chairman Sen. James Eastland (D. Mis.) to consider regulatory issues in the committee.
But as Kennedy left Washington Wednesday, Eastland cnnounced his retirement, virtually assuring Kennedy of the chairmanship of the whole committee and an opportunity to have greater influence in issues such as deregulation.
"I have a very significant interest in areas of regulatory reform." Kennedy said in and interview during the flight to Chicago, "and I have intention of following those.
"Generally," he added, "most of those issues of serious importance and consequences are really decided in full committee - and in the future that will be so."
Kennedy acknowledged that it will not be as easy to rally public support for trucking deregulation as it was for airline reform, where the consumer sees a direct changes to pricing as a result of deregulation. But he is confident that he can get his message across.
"If the average consumer could understand this system in a clear way, he or she would't tolerate a system which permits price fixing and does fundamental violence to the comcept of a free and open competitive system. Based on out hearing, what this system needs is a healthy infusion of competition and less regulation.
"Housewives and shoppers generally spend a good deal of time getting good bargains and understanding good deals and know the difference between a few cents on a product." Kennedy said. "The real point is to communicate to them - the strongest lobby group in this country, the family purchaser of the goods in the markets of this nation - and I think we'll have a strong ally."
Kennedy said he was confident that "We're going to pass the airline reform bill this year." But he conceded that he could not get a trucking bill through this time around.
"But," he said, "We have a good opportunity to begin the process as we did with airlines earlier.
"We ought to rely on the competitive system, not the regulatory system. This is not only legimate theory," he said, "but practice as well. All you have regulation with those tries that have regulation with those that don't, and compare the cost of comparable goods traveling a comparable amount of time. Air cargo is basically non-regulated, and they (the airlines) have to get their goods from Oshikosh to Pocation, too."
To support his view that the consumer is losing out to truckers under the regulatory system, Kennedy unveiled a chart at yesterday's hearings which showed that hte top eight trucking firms as a group were earning a return on equity almost twice that of the Fortune 500 corporations as a group.
While consumers and firms that ship their goods on trucks are almost unanimous in their support of some reforms in trucking, the industry is waging a tough fight against any change.
"Collective rate making cannot be successfully viewed in a vacuum," testified Henry Fabritz, vice president of Ruan Transport Corp. of Dqs Moines, "Realistically, collective rate making must be evaluated as only a part of a total transportation system - a system which I believe is the envy of the free world."
Fabritz claimed that even though they have no vote in the process, the public is invited to attend the rete bureau meetings at which the freight rates are set. And, he said, truckers will frequently request that rates be lowered.
He also handed out figures that showed that between 1973 and 1977 truck rates rose about 39 percent compared to the whole sales price index, which climbed 58 percent, which jumped 46 percent.
The strongest oppostion to regulation has come from the American Trucking Association, one of hte best organized and most respected trade organizations in Washington.
"The average consumer in the United States takes freight transportation for granted," states the ATA deregulation white paper issued this week. "That is the highest tribute that can be paid to the regulatory system. If (the system: were a mess as the critics contend, nobody would be taking (it) for granted, and truck transportation would be the butt of the same kind of jokes comedians tell about the mail services."
The ATA takes the view that "transportation is as special as telephone or electric power service and cannot be left completely to the competition of the market place without jeopardizing the public right to such service at an equitable rate."
The statement adds, "It is is the need of all shippers, particarly the smaller ones, for dependable service at an eauitable cost."