Letter to the President of the Senate and to the Speaker of the House on Transportation Policy.

Dear Mr.__________:

Although our Nation enjoys one of the most highly developed and diversified transportation systems in the world, it has been severely handicapped by laws and regulations which have failed to keep pace with advancing technology. In my message to the Congress last year, I pointed out that the basic objective of our transportation system must be to assure the availability of fast, safe and economical transportation services needed in a growing and changing economy to move people and goods, without waste or discrimination, in response to private and public demands, at the lowest cost consistent with health, convenience, and national security. In that message I recommended a number of legislative steps to accomplish this purpose.

If action is not taken to establish a transportation policy consistent with the new demands upon the economy, we face serious problems of dislocation and deterioration in both the transportation industry and the economic life of the nation which it affects. I urge that action be taken to establish such a policy.

Our objectives must be achieved, primarily, by continued reliance on unsubsidized, privately owned facilities, operating under the incentives of private profit and the checks of competition insofar as this is practicable. The law should provide a consistent and comprehensive framework of equal competitive opportunity that will achieve this objective at the lowest economic and social cost to the Nation. There must be equality of opportunity for all modes and for all passengers and shippers, without any special preferences. There should be maximum reliance on the forces of competition consistent with a continuing need for protection against destructive competition between forms of transportation or between competing carriers.

I am transmitting herewith, for the consideration of the Congress, draft legislation carrying out these principles, providing equality of opportunity among carriers, removing artificial barriers to the realization of the inherent advantages that each mode of transportation possesses, and assuring the protection of the antitrust laws against any destructive competition.

The most significant recommendation in my message of last year dealt with the inequality resulting from exempt transportation of bulk commodities by water and agricultural products by truck. All traffic, however, moving by railroad is fully regulated. I recommended that this inequality be corrected by removing minimum rate regulation from all transportation of bulk and agricultural commodities, but under the protection of existing laws against monopolistic and predatory trade practices applicable to business generally. In the alternative, appropriate regulation might be applied in the areas presently exempt, as I recommended in my message last year. I, therefore, renew my request that, in the interest of equality, one of these solutions be adopted.

I am also enclosing a copy of a letter from the Secretary of Commerce to me discussing legislation in greater detail. I urge that the Congress give prompt consideration to these proposals. I also recommend that legislation be enacted to make domestic truck air carriers ineligible for operative subsidies in the future, to require motor carriers and freight forwarders to pay reparations to shippers charged unlawfully high rates, to make motor carrier safety regulations applicable to private carriers, and to repeal the prohibition against rail carriers transporting commodities in which they have an interest.

These bills, if enacted, will represent a major accommodation to the present needs of the economy. They should strengthen our carriers, provide their users with a better and cheaper system of transportation, and help relieve the taxpayers of unnecessary burdens.

Sincerely,

JOHN F. KENNEDY