Mr. McGREGOR. Will it be cheaper?

Mr. FOWLER. If the St. Lawrence seaway were built?

Mr. MCGREGOR. Yes.

Mr. FOWLER. It would be. If we would have to bring our ore in from North Atlantic ports it would be cheaper to bring it down by the St. Lawrence seaway.

Mr. McGREGOR. I think you misunderstand my statement. If we built the St. Lawrence seaway and you bring the ore into Cleveland and ship it overland by railroads the same as you are now, will that make the cost of the steel per ton cheaper than it is now?

Mr. FOWLER. The cost of steel to the consumer?

Mr. MCGREGOR. Yes.

Mr. FOWLER. I cannot say as to that.

Mr. MCGREGOR. If it would not, what would be the argument for this project?

Mr. FOWLER. The argument would be that the Youngstown district and the southern Ohio districts and Pittsburgh district that would depend on Labrador ore would be better able to compete with other districts in their manufacturing.

Mr. MCGREGOR. Then competition is a big item?

Mr. FOWLER. Absolutely.

Mr. McGREGOR. If you get the St. Lawrence waterway, and you get an inland canal from Cleveland to Youngstown and Youngstown to Pittsburgh, you certainly then will have an advantage over your competitors, will you not?

Mr. FOWLER. I would not say we would have an advantage. I would say we might be comparable with them. You have to bear in mind that the Youngstown area from the standpoint of the steel industry is the only large steel-producing area in the United States that is landlocked. They do not have other methods of transportation than rail. We have nothing but rail.

The Pittsburgh district has water for its raw materails. The Chicago district has water. The Atlantic seaboard district has water and water transportation is a great deal cheaper than rail transportation for comparable distances.

Mr. MCGREGOR. As it is now, you always compete with your competitors on prices, do you not?

Mr. FOWLER. Maybe the know-how has something to do with that.

Mr. MCGREGOR. I think that is true.

Mr. DONDERO. Coming from Ohio.

Mr. McGREGOR. Naturally. In other words, if you get your St. Lawrence waterway and you get the canal you are recommending; that is, which your people in Youngstown are recommending from Cleveland to Youngstown, which would be an inland waterway, and then get your canal from Youngstown to Pittsburgh, you certainly would have an advantage over your competitors, would you not?

Mr. FOWLER. I would not say we would have an advantage. I would say we would be placed on a competitive equality with them. Right now I have pointed out that there has been no expansion in steel in Youngstown for 20 years. From the standpoint of our own company alone, by 1952 we will have expanded 66 percent at Chicago on Lake Michigan, and only 11 percent in 5 years at Youngstown.

Mr. MCGREGOR. The fact that you are in a coal area, or adjacent area, certainly gives you a good chance to meet your competitors' prices, does it not, Mr. Fowler?

Mr. FOWLER. No. We are not in as much of a coal area as Pittsburgh is. Pittsburgh is located right in the heart of the coal area. Mr. MCGREGOR. There is quite a lot of coal around Youngstown, such as strippers, and so forth?

Mr. FOWLER. Not available for the steel industry. The only coal around Youngstown is known as steam coal, and our vast requirements are for metallurgical coal, which has to come from the Connellsville district in the southwestern part of Pennsylvania.

Mr. MCGREGOR. If you get your canal from Youngstown to Pittsburgh, that would help out the coal situation, would it not? Mr. FOWLER. It certainly would.

Mr. MCGREGOR. That is all, Mr. Chairman.

The CHAIRMAN. Mr. Mack.

Mr. MACK. Mr. Fowler, I have two brief questions. You quote. the Iron and Steel Institute as saying there was contemplated an expansion of the steel industry from 97 million tons to 1171⁄2 million tons, which is a 21-million-ton increase. What percentage of that increase will be in the Atlantic seaboard area?

Mr. FOWLER. I do not have those figures broken down, Mr. Mack. Mr. MACK. You mentioned United States Steel, Weirton, and Bethlehem all are building plants on the Atlantic seaboard.

Mr. FOWLER. I am only guessing, but as I recall it, the Steel Corp. plant in Morrisville contemplates a production of about 11⁄2 million or 1,800,000 tons. I would say that and again it is a guess I would say that about 80 percent of that increase will be in the eastern area.

Mr. MACK. One other question. You said, I believe, that the transfer charge at Baltimore would be 87 cents a ton, and that at Ashtabula it would be 31 cents?

Mr. FOWLER. 33 cents.

Mr. MACK. What is the reason for that differential, Mr. Fowler? Mr. FOWLER. Well, the reason for that-the main reason is the inadequate facilities which exist at Baltimore for the transfer of ore, and the fact that these facilities at Lake Erie are old facilities. While they have been kept up to date, they are probably pretty well depreciated and they do not have to earn the same amount on their investment there that they do in the East.

Mr. MACK. The installation of adequate facilities at Baltimore would be rather expensive, I take it.

Mr. FOWLER. It would be extremely expensive. In fact, the B. & O. is building an installation there right now at present-day costs, but at present-day costs if they build those facilities naturally they have to get more for the transfer in order to carry the investment than they do in the old facilities at Lake Erie.

Mr. MACK. I appreciate that, Mr. Fowler. I thank you.

The CHAIRMAN. Mr. Wood.

Mr. WOOD. No questions.

The CHAIRMAN. Mr. Scudder.

Mr. SCUDDER. I would just like to ask one question of you, Mr. Fowler.

Mr. FOWLER. Yes, sir.

Mr. SCUDDER. I believe the testimony the other day developed the fact that the mines would operate about 6 or 7 months out of the year. Even though this transportation system was owned by the corporation, they would be responsible for its upkeep and would have to provide funds to amortize its cost. Now would it not mean that your operation cost would be much higher than an ordinary railroad as you would only employ your help for a period of 6 or 7 months a year, you most likely would have to pay bonuses in order to get operators for a railroad of this type? Would not that be in line with the practice in recruiting temporary help for that type of an operation, which would run costs rather high for your rail transportation? I am just trying to get at the transportation costs.

Mr. FOWLER. Mr. Scudder, I am not competent to answer that as to the details of the operation on that particular line. The only thing I can say to you on that is that we have railroads in this country-the D. M. & I. R. up in Minnesota, the Bessemer & Lake Erie down in Pennsylvania, and the Lake Superior & Ishpeming Railroad up in the northern ore fields-which are primarily ore carriers and only carry ore 7 or 8 months in the year. Yet they are the wealthiest railroads in the United States as far as profits are concerned. Yet they have a seasonal operation just the same as this railroad would have.

Mr. SCUDDER. Then you feel there would be no extra burden on the company for the hauling of ore, even though they would own the railroad and would have to recruit seasonal employment?

Mr. FOWLER. Whatever extra burden there is has been considered in and computed in the cost of the transportation to Seven Islands. That is a necessary part of the operation.

Mr. SCUDDER. I thank you.

That is all.

The CHAIRMAN. Are there any other questions of the witness?

(No response.)

The CHAIRMAN. Thank you.

Mr. FOWLER. Thank you, gentlemen.

Mr. LARCADE. Mr. Chairman.

The CHAIRMAN. Mr. Larcade.

Mr. LARCADE. Mr. Chairman, I would like to ask permission of the committee to have the record show that at the beginning of the hearings and I think it was on the first day-the chairman gave permission to the gentleman from Michigan, Representative John Dingell, to file a written statement for the record; and that Mr. Dingell undertook to make an oral presentation but, due to the fact that the committee was about to adjourn, it was not possible for Mr. Dingell to complete his statement. Now, Mr. Dingell was scheduled to appear this morning before the committee. Unfortunately, Mr. Dingell is ill, and he is unable to do so.

I would ask that Mr. Dingell be given permission to file an additional statement in the record as a proponent of the St. Lawrence seaway. Likewise, Mr. Chairman, I would like to ask permission that the record show that the gentleman from Minnesota, Representative Fred Marshall, was scheduled to appear this morning to testify in support of the St. Lawrence seaway, and that he has telephoned that he is unable to do so. I will ask permission for him also to file a statement for the record at this point.

Also, Mr. Chairman, any other persons who were unable to appear before the committee during the period that the committee was hearing_testimony in support of the bill.

Mr. DONDERO. I would agree as to those who were scheduled because I would not want, in a sense, to open up the door for the whole public to begin filing statements, which would make the record very voluminous.

The CHAIRMAN. That is right.

Mr. LARCADE. I withdraw the last part of my motion, Mr. Chair

man.

Mr. DONDERO. There would certainly be no objection to the rest of it.

Mr. LARCADE. I would like to have my last statement relate only to Representatives Dingell and Marshall then.

Mr. MCGREGOR. I am in complete accord with the gentleman from Louisiana, and I wonder if it might be possible for us to get a copy of the statements, so that we could look at them, because it might be quite some time before the hearings are printed.

Mr. DONDERO. Surely. We could contact them.

Mr. LARCADE. That is all.

Mr. DONDERO. Mr. Chairman, there should be no objection to the gentleman from Louisiana's request.

The CHAIRMAN. With no objection, the permission is granted for the statements to be filed in the record.

(The statement of Representative Marshall is as follows:)

STATEMENT OF HON. FRED MARSHALL, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF MINNESOTA

Mr. MARSHALL. Mr. Chairman and gentlemen of the committee, I appreciate the opportunity to appear before you and wish to join with the other members of the Minnesota delegation in support of the resolution for the St. Lawrence seaway project. Hearings held before your committee in other sessions of Congress have covered the subject well but I would like to reemphasize the benefit this project would be to the agricultural sections of the Midwest. Others, more able than I, have or will cover the engineering, economical, and the national defense viewpoint. Although some opposition will develop, past history of our country proves that what benefits one section of our great country, benefits the whole country. Certainly the large quantities of low cost electric power that should become available to the Northeast section of our country, will do much to solve a problem of long duration in that area. So likewise the seaway would help to solve the transportation problem for the Midwest. Each year we, in the Midwest, are handicapped because of the shortage of boxcars which makes it impossible to move our farm products to market. Completion of the seaway would lessen the number of cars we would need and would not make it necessary for Eastern railroads to move the cars owned by our railroads to midwestern terminals as quickly. That, in turn, would relieve some of the problem of the lack of cars which, we are told the eastern railroads now experience. Previous hearings have indicated that the cost of moving our agricultural products would be less if it were possible to transport them over the water route. This would benefit both the producer and the consumer; by giving the producer a greater return for his product and by making that product cheaper to the consumer.

Our area produces an abundance of grain and dairy products. Because we produce more of these products than we need in the area, we are pleased to share them with those more thickly populated areas that need them to continue to have a good standard of living. However, in order to make them available at a price that the average family can afford, we must have a cheaper method of transporting them. Even if a toll system is used-and it is generally the opinion of many that this method of paying for the project should be used—transportation costs would still be less than those now in effect. Much of our grain finds its way into foreign markets and here again a cheap system of transportation will create a larger

market for our agricultural products. The St. Lawrence seaway would form a natural highway into the richest farm-producing area in the world.

The need for a reduction in Federal spending cannot be used as an argument against starting the project now as it has been made clear by expert testimony which this Committee heard in previous years that the project can be self-liquidating. While there is no question but that nonessential expenditures should be drastically reduced, it seems to us pennywise and pound foolish to fail to start projects that will develop the natural resources of our country and add to the wealth and strength of our Nation. The development of natural resources has always created more jobs for our people and because of this, more people have been able to pay their taxes. If we are going to prevent the spread of communistic ideologies, we will need more than force to combat them. Our farm products will play a leading role in this respect, and if we can reduce the cost of transporting them to the peoples that need them we will have lessened the burden for our taxpayers.

The CHAIRMAN. On the first day that we opened the hearings all those who introduced bills in the House were notified that they could either appear here personally to testify, or that they could file a statement in the record. Now we have with us a man who practically lived his life here in Congress fighting for water power and electricity in the rural districts. We would like now to hear Congressman Rankin.

STATEMENT OF HON. JOHN E. RANKIN, MEMBER OF CONGRESS FROM THE FIRST CONGRESSIONAL DISTRICT OF MISSISSIPPI

Mr. RANKIN. Mr. Chairman, it is my desire to discuss this measure largely from a power standpoint.

Mr. DONDERO. Perhaps our able friend and colleague would like to sit down.

Mr. RANKIN. I believe I would talk longer if I sat down. It is probably best for the committee if I stand up. Confucius said, "Make your speeches short if you want them to be long remembered." I will try to profit by that sage advice.

When I came to Congress in 1921 and entered this fight on the power issue, the people of the United States used 37,180,123,000 kilowatthours of electricity. Last year-1950-instead of using the 37 billion kilowatt-hours, the American people used 329,028,000,000 kilowatthours; or, approximately 10 times as much as when I entered this fight 30 years ago.

When President Roosevelt became President, Senator Norris had already joined us in the fight for the creation of the Tennessee Valley Authority. Senator Norris was also interested in the development of the Columbia River. President Roosevelt was interested in the development of the St. Lawrence. I went over all these projects and I found that they were all justified. I supported all of them.

Today the TVA is the greatest success of its kind in all the history of mankind. It has wrought the greatest development ever known in all history and the Columbia River development is right along with it, I will say to the gentleman from Washington.

In the district I represent every single human being who turns an electric switch gets his power from the TVA, at TVA rates. I would certainly be an ingrate if I should run out on this power development on the St. Lawrence River at this time, especially under the circumstances which I will attempt to explain to you briefly.

Now, let us take this electricity, which is the lifeblood of our advancing civilization. The cheaper the rates, the more freely it