pr
ALASKA RATES
HEARING HELD
IN WASHINGTON
(Continued from Page One)
tain a loss of between eight and
ten million dollars unless the ba
sic rates were increased well over
60 per cent in view of greatly in
creased labor costs, need to in
vest in new equipment and the
rising cost of goods. In coming
to this conclusion, the carriers
based their Seattle estimates on
1939 operations, and criticism was
r made by OPA’s Donald O’Connor
that conclusions reached by the
carriers’ estimates were “insup
portable” and did not take into
consideration increase of popula
tion and traffic since 1939. “The
central and strategic importance
of this hearing,” Mr. O’Connor
contended, “should not be rates
but a realistic consideration of
the post-war traffic conditions of
Alaska, the number and types of
vessels needed to satisfy Alaska
traffic and costs projected from
a 1945 or 1946 base rather than
the 1939 base.
“You load the dice on a traffic
estimate if you assume a territory
like Alaska, which has experien
ced an increase of population, is
going to import no more tonnage
in 1946 than in 1939.” Mr. O’Con
nor declared in submitting that
there were now at least 13,000
more civilians in the Territory
than in 1939 and a military ad
dition approximating 25.000 which
* the Alaska carriers did not take
into account when projecting their
1939 operations into 1946.
Mr. O’Connor estimated the Al
aska public and shippers would be
called upon to spend an addition
al $10,000,000 a year if the in
creases which the carriers sought
in the Seattle hearings were put
into effect.
Among recommendations made
by Mr. O’Connor and agreed to
by representatives of the terri
torial and federal agencies was
a proposal that the present rate
on canned salmon be considered
because “canned salmon is res
ponsible more than any other for
the high costs of a fleet operation
in Alaska” and shippers of north
bound goods are discriminated
against by the favorable rate af
fixed to the movement of south
bound salmon. A further pro
posal made by Mr. O’Connor out
lined the operation of vessels by
the fishing industry which would
relieve commercial carriers of ad
ded costs of frequent operations
during the few months of the
year. Suggestion was also made
that barges could be used for
the salmon traffic. Consideration
should also be made, he believed,
if commercial carriers continued
carrying canned salmon, of using
idle ships from December to June
in the sugar trade between the
States and Puerto Rico.
In contending that economies
could be effected so that the 12
per cent loss sustained by the
government in 1945 would be re
duced under federal or private op
eration in 1946, Mr. O’Connor
counselled that any resulting loss
should be subsidized rather than
met by a rate increase.
Claiming that the operational
loss over the past few years was
due to war conditions, Alaska’s
Attorney General Rivers recom
mended that the coming year be
regarded as a transition period
and that a subsidy be allowed
wether WSA continues to control
the Alaska trade or the operation
reverts to the private carriers.
“To raise rates because of con
ditions caused by war would be,
in effect, to saddle Alaskans with
results of national events,” Mr.
Rivers argued, in pointing out
that Congress would have to act
to allow a subsidy to private car
riers.
Governor Ernest G r u e n i n g
stressed that Alaska now more
than ever was strategic to the
nation and pointed out the vital
importance of strong transporta
tion ties between the States and
the Territory.
WSA exhibits demonstrated
their general agents completed
218 voyages to the Territory in
1945 carrying approximately 600,
000 tons of freight and 59,433 pas
sengers, yielding a net loss of $1,
361,861.93. The expenses total
ling $12,922,909.20 were offset by j
$8,032,206.24 in revenue, and ad
justments for the revenue value
of military traffic and U. S. mail
which were caried free were made
resulting in the net loss.
S. J. Swanson blamed most of,
the high costs of operation of Al
aska Transportation Company’s
vessels on increasing labor de
mands and stated that not until
labor realizes its responsibilities
would the problem of trade rates
be solved. He recommended gov
ernment operation be continued
until the results of the hearing
were made known with payment
of a subsidy continued. Mr. Swan
son revealed the TAKU and TYEE
would be sold as they are “too
small for efficient operation be
cause of the high cost of labor,’’,
and that the company anticipated i
purchasing new vessels under the
ship disposal bill. The new bes
sels contemplated would be of
the N3 type costing approxim
ately $500,000 apiece. However,
the operation of the new vessels
under present conditions, would
require 150 per cent additional
revenue which the public “should
not and could not be expected
to provide,” and he claimed the
only solution would be subsidiz
ing.
In the operation of new passen
ger vessels, the Alaska Steamship
Company would need an addi
tional 41 per cent increase to
break even with its losses of 1945,
according to Gilbert Skinner,
President of the company, and
an increase of 13Vfe per cent for;
operating new cargo ships. “We
do not feel the Territory actually
needs new vessels,” Mr. Skinner
stated in testifying that he be
lieved the present vessels, if
maintained on prewar schedules,
would last 10. or 12 more years.
New vessels, however, would have
to be constructed to meet addi
tional passenger tonnage should;
the need arise, according to Mr.
Skinner, because replacements
cannot be found among ships al
ready built. A year and a half
ago, Mr. Skinner revealed, plans
were laid to build three new,
ships at a cost o f$4,000,000 apiece
and weighing between 5600 and
6000 tons, but from the figures
introduced at Seattle and in i
Washington, he contended it would
be impossible for the company to
invest in new vessels and oper
ate them at a nominal profit. Ira
Ewers, attorney for Alaska Steam
ship Company and Northland
Transportation Company, stated
that "barring greatly changed
conditions, we do not care to res
ume operations if the government
relies on WSA figures since there
is such a variance between those
figures and ours.”
Norman Stines, representing the
cities of Nome and Fairbanks and
the Northwestern Alaska Chamber
of Commerce, declared, “the pres
ent rate stifles industry in Al
aska and any increase will most
probably strangle it.” He contend
ed that since Alaska is recognized
as a vital strategic area the defi
cit should come out of Army and
Navy appropriations until such
time as the expansion of trade
in Alaska meets the operation
costs.
For the first time since 1939
figures were compiled and sub
mitted showing volume of domes
tic and foreign commerce bet
I
j ween the States and Alaska. Dr.
* Paul Zeis of the Department of
Commerce testified that increase
in post-war trade over 1939 was
: indicated as soon as consumer
goods exports to Alaska w’ere a
vailable. The value of products
shipped to the Territory in 1945
was $20,000,000 more than that of
1939 with the greatest increast in
whiskey, malt liquor, perfumery
and cosmetics.
Recommendation by the Mari
time Commission will be made af
ter all parties concerned file briefs
with the Maritime Examiner, F.
J. Horan. Indication was made
: by all persons testifying at the
hearing that action by Congress
j would be necessary to avoid in
creases in rates in the Alaska
trade.
REALTOR ALMOST SELLS
HIMSELF AS A COACH
ALBUQUERQUE, N. M. —<&)—
Gwin Henry, former University
of New Mexico football coach,
was in the headlines recently—
all by error, he claims.
Henry wired officials a? New
Mexico A. and M. College in be
half of Maurice.. Moulder, former
University of Missouri grid star,
seeking an interview for Moulde
as a candidate fo the vacant Ag
gie coaching job.
His wire, Henry said, misfired
and the first thing he knew, he
was being considered for the job
m
himself. Now in the real estate
business, he remarked “I might
be interested” in returning to the
i coaching profession.
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