billion in gross revenues, moved 28,292,000 freight car The dependence of certain sectors of industry on railroads to deliver key inputs of raw materials or components is of prime importance. The availability of these key inputs to industries is a most important factor in their ability to continue production. Industry rate of production is determined by the level of raw material inventories they hold and the rate these can be replenished. A sector-by-sector analysis reveals that virtually all the goods producing industries are heavily dependent on rails for delivery of key inputs. In fact, most goods sectors, other than petroleum, glass, office machines and textile related industries, are dependent on rail for from 50 to 80 percent of key input deliveries. Railroads do more for the consumer than move bulk and raw materials. Traffic they carry includes 0.46 percent of meat and dairy products, 0.74 percent of canned and frozen foods, 0.71 percent of household appliances, 0.76 percent of automobiles and automobile parts, 0.78 percent of lumber and wood, 0.40 percent of furniture, 0.63 percent of chemicals, 0.68 percent of primary metal products, and 0.86 percent of pulp and paper. Estimated weekly impact of postal service (carloads): Number of carloads affected: Railcars__ . TOFC's (piggyback) Total___ Employees and shipments affected: Railroad employees with wages of $128,310,000 per week.. Freight cars stopped, including some 360,000 under load en route, 600,000 empties en route, 350,000 placed for loading, 350,000 placed for unloading and balance setting empty... 2. Impact on economy Weekly in 1970 $3, 196 5, 384 3, 770 12, 350 207, 692 28, 846 248, 888 4,336, 500 1, 820, 690 1, 505 3, 920 5, 425 580, 000 1, 820, 000 Rail transportation is an important part of the industrial production process. A nationwide railroad strike would have a spreading or cumulative effect greater than the immediate impact on particular industries which rely heavily on rail service. Coal is an example. Three-fourths of all coal moves by rail and is used not only for personal consumption and export, but is used also by producers of energy and other commodities, such as iron, steel, stone, and clay products. This cumulative effect supports the prediction that a nationwide railroad strike lasting 1 week would result in losses to economic output representing 5.8 percent of the gross national product. In a strike lasting 8 weeks, the loss in economic output could rise to as high as 24 percent of GNP. If all production worker man-weeks lost because of a strike were reflected in unemployment (excluding those directly involved in the labor-management dispute) the unemployment rate would jump to 8.4 percent (based on April 1970 rate) by the second week of the interruption, and move up to 22.1 percent by the eighth week. 3. Impact on other modes No excess capacity from other modes would be immediately available after a work stoppage, but this excess capacity would gradually come into use as weeks progress. An internal analysis of the expected capable increase in capacity of the other modes estimated that for-hire motor carriers the excess could be 33 percent of normal ton miles; private trucks engaged in intercity hauling would be able to increase their capacity by 10 percent; air freight could increase 50 percent of normal but no increases for barge lines. In terms of the amount of rail traffic these other modes can absorb, this represents approximately 15 to 20 percent of total rail volume. 4. Defense shipments Nearly 40 percent of Defense Department freight moves by rail. It is estimated that almost one-third of that traffic could not be transported any other way. There is an average of 815 carloads originating daily; most important of these include: 150 cars of munition; Specialized rail car shipments of Titan III, Minuteman, Polaris missiles; Nuclear movements in shielded containers and depressed flat cars; Military-owned flat cars ("force of readiness" and "strike command"); 25 cars of sulphuric acid; and 20 M-28 tanks. 5. Impact on Penn Central As emphasized by the trustees of the Penn Central in recent hearings before the Senate Commerce Committee any interruption of railroad service would hasten the day when their cash balance would enter into a deficit position. Affected: 95,000 employees. 250,514 daily passengers. 17,028 daily carloads. $3,683,777 loss in daily freight revenue. $403,045 loss in daily passenger revenue. PROVISIONS OF THE BILL The bill provides that section 10 of the Railway Labor Act, shall apply to the current railway labor-management dispute, and shall be extended for an additional period, until February 17, 1971. Section 10 of the Railway Labor Act provides that upon the establishment of a Presidential Emergency Board, to make recommendations to the President, and for 30 days after the date the Board has submitted its report, strikes and lockouts are prohibited in disputes subject to that section 10. Since the strike or lockout is declared unlawful by this provision during the period of its applicability, any such strike or lockout can be enjoined by the courts. The resolution reported herewith provides that the above mentioned prohibition against strikes and lockouts shall be extended beyond the date on which it otherwise would expire (December 10, 1970) until February 17, 1971. This extension will provide additional time for the parties to attempt to settle the differences that will exist with respect to the issues involved in the dispute, and will provide time or organization of the 92d Congress, so that that body will be in a position to deal with the dispute, if it has not been resolved by February 17. AGENCY REPORTS Hon. JOHN W. MCCORMACK, U.S. DEPARTMENT OF LABOR, Speaker of the House of Representatives, DEAR MR. SPEAKER: I am transmitting herewith draft legislation to carry out the President's recommendation for averting the threatened nationwide rail dispute. The draft legislation provides an extension for an additional period of 45 days of the prohibition against strikes or lockouts in this dispute. This situation demonstrates forcibly once again that we must have permanent effective procedures for solving labor disputes of this nature. Last February the President proposed the enactment of an Emergency Public Interest Protection Act to provide such procedures for the transportation industry. However, as such legislation has not yet been enacted and, in view of the urgency of the present situation, I recommend that the legislation I am transmitting be given immediate and favorable consideration. Sincerely, Secretary of Labor. EXECUTIVE OFFICE OF THE PRESIDENT, Hon. RALPH W. YARBOROUGH, Washington, D.C. DEAR SENATOR YARBOROUGH: I am writing to you from my position as Chairman of the President's Joint Board on Fuel Supply and Fuel Transport which he appointed to maintain surveillance and take needed actions for the coming heating season. The membership includes the Secretaries of Interior and of Commerce, and the Chairmen of the Council of Economic Advisers, the Federal Power Commission, the Interstate Commerce Commission, and the Council on Environmental Quality. Our Joint Board considers that, barring extraordinary interruptions such as a transportation strike, there will be no significant fuel problems during the coming winter. We have appraised the situation in case of a rail strike. Our conclusions include: (a) The fuel situation, particularly coal, would be immediately affected by a rail strike. While our Joint Board efforts and those of industry have been building inventories, there are still a significant number of public utility plants with low fuel inventories. (b) A rail strike would have a spreading and multiplying effect on industry and our whole economy and society through lack of fuel transportation alone. Three-fourths of all coal moves by rail. Suspension of rail movement would cut off: (1) sixty-eight percent of coal going to electrical power utilities; (2) seventy-five percent of coal going to coke and gas plants; (3) seventy-nine percent of coal going to industrial plants. Regional effects would be most severe in New England, West North Central, South Atlantic, West South Central, and Mountain States. Because of the interdependence of shipping and receiving areas, there would be a general disruption of commerce. (c) Our survey of excess capacity from other than rail transportation indicates that only 18 percent of the normal volume of coal transported by rail would move, even with top priority. I do hope that the foregoing summary estimate, focused only on the fuel situation, is sufficient to be convincing that a rail strike would quickly place our country in a critical situation in regard to energy supply as we now enter the cold weather season. Sincerely, DEPARTMENT OF AGRICULTURE, Hon. RALPH W. YARBOROUGH, Washington, D.C. OFFICE OF THE SECRETARY, Washington, D.C., December 8, 1970. DEAR SENATOR YARBOROUGH: If the nationwide railroad strike scheduled for 12:01 a.m., Thursday, December 10, 1970, proceeds as scheduled, it will have serious adverse effects on agriculture and consumers in both rural and urban areas. The population of the United States is fed through a smoothly flowing, never ceasing pipeline. This pipeline requires a regular movement of raw products and processed goods throughout the year as relatively low stocks of processed items are held in homes, retail stores, or distribution warehouses. Interruption of the pipeline would result in instances of immediate shortages of food, particularly fresh fruits and vegetables. Consumers demand food in steady supply. Even minor and temporary shortages result in large price increases. Similarly, much of the Nation's livestock population is dependent on a continuing flow of feed from surplus producing areas. Commercial feeders of beef, poultry and hogs customarily keep little feed on hand. Interruption of the flow could result in losses for many producers of meat, milk and eggs, as well as losses of some herds and flocks within two weeks. Substantial flows of grains to ports for export and to terminal locations for storage just after harvest compound the complications of a strike threat at this time of year. Exports sales could be lost and interior storage facilities over burdened if sufficient transportation is not available. In addition, supplies for use next year are now being moved to farming areas for local distribution at the beginning of the planting season. Finally, widely scattered electric generating plants depend heavily on rail transportation for a continuing supply of fuel. This cannot be interrupted for long if adequate power is to be available in both rural and metropolitan areas. In our opinion, other forms of transportation generally are not able to fill the void created by nationwide rail strikes. This is especially true during the winter months when waterways become frozen over. Sincerely, Hon. RALPH W. YARBOROUGH, J. PHIL CAMPBELL, THE POSTMASTER GENERAL, Washington, D.C., December 8, 1970. DEAR SENATOR YARBOROUGH: The purpose of this letter is to acquaint you with the effect that a nationwide cessation of rail service at this time would have upon the operation of the postal system. |