Mr. McIntosh agreed and packed his clothes to come up to the union office, as the master was not on the ship and he would have to return for his money.

Late in the afternoon, I assigned Mr. Erwin Stout to the vessel through the Radio Marine Service, and he and Mr. McIntosh left the union office for the steamship Capillo.

When the two men boarded the ship they were greeted by the master, Captain De Lucca, who had returned from shore. Captain De Lucca started to abuse the two men and knocked off Mr. Stout's glasses with a blow to the jaw.

I had a telephone call from Mr. Stout to the effect that Captain De Lucca had left the vessel with his second officer making veiled threats that he would "show the union a thing or two," and as I walked away from the telephone Captain De Lucca walked into my office hurling various threats about "breaking" my "dirty little neck" and daring me to fight it out with him. I saw that the captain was extremely intoxicated, having difficulty in keeping on his feet. (I have since learned from Mr. McIntosh that he had rescued the captain's collar, hat, tie, and coat from the street where he had thrown them before entering my office.) I tried to reason with the captain, as I had no wish to engage in fisticuffs with him since Mr. McIntosh wanted to enjoy the rights guaranteed him under the Wagner Act to join and be represented by a union of his own choosing; also the rights which any American seaman is supposed to enjoy: to leave his vessel in any safe American port when not under articles.

The captain then demanded that I allow him to call the Maritime Commission in Washington so that he could "tell them a thing or two." He did succeed in contacting the Commission's office in Washington where a long conference was held over the telephone about the action taken by Mr. McIntosh. The captain threatened to resign, stating that he would not sail on any ship where the unions were allowed to organize.

I have no idea what the Commission's reply to this was, but after the conversation the captain turned to Mr. McIntosh and said, "You will come back to the ship and we will see that you are not bothered again," whereupon Mr. McIntosh reiterated his previous stand that he wanted to be paid off and that he wanted to join the union. The captain then turned to Mr. McIntosh and called him a yellow so and so, and a few other things. The captain then said to his second mate, "Let's leave this dirty joint, and if I ever see that delegate on my ship again, I'll blow his damned brains out."

I finally did get Mr. McIntosh's wages, and Mr. Stout refused to sail on the vessel with Captain De Lucca, so we assigned another man as radio operatorMr. Henderson.

The union then had to pay for the repair charges to Mr. Stout's glasses. However, the agent for the American Republics Lines paid $3.30 for the telephone call the captain had made to the Maritime Commission's office in Washington and service charges on a call to Sprague's Mr. O'Halloran.

Mr. Henderson reports to this office that the main reason why the steamship Capillo was run aground on leaving Boston Harbor last trip was because the captain was too drunk to realize that he had a large freight vessel under him. The Capillo had to return to Boston and to the drydock for repairs that must have cost the Commission thousands of dollars, and the most significant proof of this is the fact that Captain De Lucca is no longer attached to the Capillo, having been removed after the grounding incident.

So your delegate suffered nothing more than a slight blow in the jaw, which he managed to duck, and a shirt ripped off his back when the captain attacked him. Submitted by,

Radio license No. T-2-371.

Master's and pilot's license No. 136628.

Second issue. Any gross tons, any oceans.

STATE OF PENNSYLVANIA,

County of Philadelphia, ss:

(Signed) EUGENE DUPREE,

Delegate, Philadelphia, Pa.

Sworn to and subscribed before me by Eugene Dupree this 13th day of De

cember 1937.

(Signed)

My commission expires March 25, 1941.

ELLEN E. DEADY, Notary Public.

(Photostat of the above is filed with the clerk of the Commerce Committee.)

The CHAIRMAN. Is that all now?

Mr. BOROW. Yes, sir.

The CHAIRMAN. Now, Mr. Borow, it is largely our fault, no doubt; but you have been on the stand for an hour and a quarter, besides your time yesterday. And you feel you have had plenty of opportunity to present your case, do you?

Mr. BOROW. I do, sir. Thank you.

The CHAIRMAN. Now may we hear from this gentleman who has come from a considerable distance?

STATEMENT OF EDGAR N. GOTT, ASSISTANT TO THE PRESIDENT, CONSOLIDATED AIRCRAFT CORPORATION, SAN DIEGO, CALIF.

Mr. GOTT. Mr. Chairman and gentlemen of the committee, my name is Edgar N. Gott, assistant to the president of the Consolidated Aircraft Corporation, San Diego, Calif.

The CHAIRMAN. Very well, Mr. Gott.

Mr. GOTT. Our concern, the second largest aircraft manufacturer in the United States, has over 600,000 square feet of useful manufacturing space and employs 3,000 men in the construction of sea-going aircraft. Our corporation, founded in 1923 by R. H. Fleet, and since then continuously under the same management, has built and delivered over $30,000,000 worth of aircraft to the Government, commercial airlines, and private interests. For the past 9 years we have specialized in large flying boats suitable for the United States Navy or transoceanic air transport.

In 1929 we designed and constructed 14 consolidated "Commodore" flying boats for the New York-Rio and Buenos Aires Lines, which was later absorbed by Pan American Airways. These airboats, each weighing 17,600 pounds and carrying 20 passengers, were the first commercial flying boats in regular operation between Buenos Aires and Miami, Fla. They founded the reputation of Pan American Airways for safe and dependable service, being the backbone of their fleet. Many of them are still in use, after 8 years without a single crash or fatality.

Regardless of the remarkable showing of the "Commodores" and 7 years of continuous and strenuous sales efforts, we have been unable to book orders on commercial flying boats at anything like a fair price. The answer is lack of customers. With but one domestic transoceanic air-line operator, and with a number of manufacturers hungry for work, a buyer's market has existed-to the point where the operator has been able to purchase equipment at much less than its cost let alone a fair profit to the vendor.

In order to survive in the airboat field, our corporation turned to governmental business; and we have accomplished much with the assistance and cooperation of the United States Navy and in return have furnished them with a highly reliable, well-performing product.

Early in 1933, six of our Navy P2Y1 airboats flew in formation from San Francisco to Hawaii, 2 years prior to the start of Pan American Airways' present operation between those points. In the fall of 1935, one of our current production airboats, the PBY, was flown nonstop from Coco Solo, Canal Zone, to San Francisco, establishing a world's distance record, broken only within the last month. Twentyfour more of our PBY's have flown, in two 12-plane formations, from San Diego to Hawaii, and 26 more to the Canal Zone, setting another

distance record for formation flying. Thus, a total of 57 transoceanic flights have been successfully accomplished by Consolidated flying boats without difficulty, but with meager publicity, since these flights were felt to be no more than routine transfer of personnel and matériel by the Navy. Two other Consolidated airboats, purchased for scientific exploration by Mr. Richard Archbold, of the American Museum of Natural History, have each spanned the continent nonstop, and arrived at the Atlantic seaboard with sufficient fuel remaining for 2,000 additional miles. One of these airboats was later used by Sir Hubert Wilkins in his search for the missing Russian transpolar flyers, and in that search traversed more than 20,000 miles over the barren Arctic wastes, without any mishap or difficulty.

We are now building for the United States Navy 176 of these PBY airboats and have just been awarded an additional contract for 33 more, making a total of 209, all of which are of a size and performance well adapted to certain phases of transoceanic commercial air transport. But still we have no customers. We seek the answer.

A recent Post Office proposal for mail between New York and Bermuda states the requirements are, inter alia, 1,000 miles range with 10 passengers and 800 pounds of mail. Both load and range are well within the capacity of our commercial version of the Navy PBY's. Paragraph 11 of this proposal reads, "The contractor must make its own arrangements at its own expense in securing concessions necessary to operate over, into, and from Bermuda." I have heard that Pan American Airways is the exclusive American air line which enjoys such a concession, thus making it impossible for any other prospective customer of ours to bid on this proposal. The field is definitely limited to the one bidder who holds the concession. So why waste time with the bidding formality?

Further, the proposal stipulates that service shall start within 6 months. As manufacturers of flying boats, we know that 4 months are required to assemble the raw materials. A quantity of new boats, of existing design, could not be produced in less than 10 to 12 months; and a new type would require at least 18 months. To make the Post Office proposal truly competitive, the United States Government should obtain the needed concessions, and sufficient time should be allowed prospective bidders for the procurement of adequate equipment.

We, as designers and builders of efficient flying boats, need more commercial operators as customers. If the New York-Bermuda air mail proposal is a fair example, then we have a long wait ahead of us, should the destiny of transoceanic air transport remain in present hands.

We believe transoceanic air transport can best be worked out in conjunction with existing steamship lines, complementing rather than competing with them. Flying boats need no prepared landing fields; and, in the main, steamship docks and terminals are not only satisfactory but much more convenient of access than the usual airports. The traffic organization, operating talent, and overhead of the steamship line will suffice for the air operation. Customs facilities likewise are identical. I am certain that the joint operation, by one concern, of water- and air-borne equipment will be economically sound and will render a real public service. American-built airboats, engines, propellers, and accessories are the best in the world today. Given a

healthy competitive condition in the over-ocean air-transport field, American builders and operators will maintain their leading position in this important world competition. For this, and other reasons, I favor placing the control of over-ocean air transport in the hands of the Maritime Commission.

Transoceanic air lines present merely another vehicle which can utilize existing facilities, and the transition from present surface vessels to airboats is not much more of a step than the change from sail to steam. I can readily visualize aircraft so large that they will be ships in the truest sense of the word, carrying the same navigating facilities, the same precautions against mishap, manned by the same type of personnel that for years have carried our flag to the remote corners of the earth.

But under existing legislation very few American airplane manufacturers are able to market their products. We have recently had inquiries for our products from an American steamship line, but have not had any from the one American oceanic air line in the past 2 years, except for one received only last week, and which I have not yet had a chance to examine. With proper legislation, the field should be open to a healthy demand. As the steamship lines enjoy subsidiesand rightly-then also should oceanic air lines, operating over the same oceans, enojy such subsidies, provided the element of healthy competition is incuded in such a step.

I wonder if you gentlemen realize the cost of a modern transoceanic air liner, through the experimental and development stage? Two million dollars is not adequate to take care of engineering, research, wind-tunnel tests, static tests, and the thousand and one items of development expense which always attend a project of this sort.

The CHAIRMAN. Would that expense attach to every single one of such planes? Would you have to make all those tests? I mean to say, after your company built one, could you standardize it?

Mr. GOTT. No, sir; after the first one is built, the rest come out more easily. It is the first one which is the "hump" of the proposition. The CHAIRMAN. I see.

Mr. GOTT. As I say, when the experimental work is completed, the production of the article in quantity is not so expensive. The experimental stage is the "hump" which at present is difficult and almost impossible to surmount. Here again, judicious governmental assistance and cooperation are needed.

We are located on the Pacific coast. Naturally, we wish to do what we can to promote the welfare of our part of the United States. For years, water-borne shipbuilding has languished on our shore; and, in fact, it has been one of the cares of you gentlemen to do what you could, in the way of a Pacific coast differential, to revive the shipbuilding industry there. Inclusion of aircraft in the proposed legisla tion will further this aim, inasmuch as a majority of the American aricraft manufacturers are now located on the west coast, thus receiving a tremendous impetus from such action.

Our prospective commercial customers are yet to appear. There is money available to foster marine development. The problem regarding water-borne traffic is identical to that concerning airboat operation. A shipping company may efficiently operate both types of craft. This does not mean that other air lines, pure and simple, will not come forward in the future; this simply means that, at present, none have the

temerity to pass even the formative stage. Airboats are essentially marine vehicles. Even now they must carry suitable navigating equipment, foghorns, anchors, and other marine gear. They should come under the same jurisdiction as the sea-going water-borne craft. Regarding the question of suitable control of trans-oceanic flying, we believe such control to be geographical rather than topographical. The same control which now applies to water-borne craft should be applied to the air-borne craft plying between the same termini and over the same ocean.

For instance, the analogy between a railroad and a transcontinental air line does not exist to the same extent as the analogy between a transoceanic air line and a transoceanic shipping line, for the reason that the railroads do not use the landing fields, and all their adjuncts, of the transcontinental air lines, whereas the transoceanic ships and transoceanic air lines do use the same facilities.

Competition is the life of trade; and it is maritime trade and commerce that you gentlemen are vitally interested in, and desire to revive.

That is all I have to say. Thank you, Mr. Chairman, and gentle

men.

The CHAIRMAN. I should like to ask you one or two questions.. Mr. GOTT. Yes, sir.

The CHAIRMAN. In order to take those planes from the west coast to the east coast, you would have difficulty in landing, should you have occasion to do so, because of the restricted fields, would you not? Mr. GOTT. Well, Senator, I am speaking of airboats now. The CHAIRMAN. I see.

Mr. GOTT. The two transcontinental flights that I mentioned were made by Mr. Archbold because he wanted to go from coast to coast in a hurry. And I should not recommend it, at all, for continued operation. I am speaking of trans-oceanic operation, and merely mentioned that to indicate to you the range and efficiency of the ships which we are now building.

The CHAIRMAN. I take it, from what you said, that you feel that under the present arrangement there is lack of opportunity for competition?

Mr. GOTT. Exactly.

The CHAIRMAN. Therefore, may I assume that you favor the provisions of the bill?

Mr. GOTT. I do.

The CHAIRMAN. In building and operating these ships, would it be necessary to provide a subsidy?

Mr. Gorr. It might be necessary; it should be available. I am not saying that we have to have it. But we would like to have the same provisions extending in our direction, in the building of transoceanic airplanes, as you may care to extend to the builders of ships for water-borne traffic.

The CHAIRMAN. Do you have faith to believe that, with the increased popularity of the service, it would ultimately become self-sustaining?

Mr. GOTT. That is our hope, yes. We want a start.

The CHAIRMAN. The talk about these new planes is that they will carry 100 passengers. Is that possible?

Mr. GOTT. Yes, indeed. None has as yet been built of that size; but that is entirely possible.