The Daily Alaska empire., 1946-06-13
|C-0F-C HEARS OF ALASKA SHIPPING
 pR0SpECTS AHEAD
Attorney General Reports on Washington, D. (.
 Rate Hearing

Addressing the Juneau Chamber of Commerce as principal speaker at this weeks noon luncheon meet ing today, Ralph J. Rivers, Attor- ney General of Alaska, summar- ized developments at the recent Maritime Commission hearing in Washington. D. C., on Alaska ship rates at which he appeared on be- half of the Territory.
 MT. Rivers remarks-with only slight deletions-were as follows:
 Continuance of Case
 The U. S. Maritime Commission rate hearing which I attended in Washington, D. c. was a continu- ance of the case which was start ed last November at Seattle. The petitioner, War Shipping Admins tration, had directed the Steam ship Companies as it's agents to carry the burden of proving the need of an increase in freight tar ifs as a prerequisite to the return of the ships to the companies for private operation. Wages and other costs had gone up, labor showdown practices had crept in, and the ships had gotten badly run down because of intensive war use.
 "As I reported after the Seattle hearing, the companies introduced exhibits showing costs of opera tion in 1889; postulated an equal amount of traffic for 1946; and projected cost estimates based on 1945 wage and other price levels The companies then measured 1889 revenue against those projected costs and concluded that freight rates would have to be raised about 100 percent to secure them com pensable returns on their respec- tive investments. This would have raised Alaska's freight bill at the rate of about $8,000000 a yeas.
 Created Crisis
 
 "As you know, this created cri- sis for Alaska Even the steamship executives admitted that 100 per- cent increase in rates would be ru- inous to all concerned and that Alaska would go downhill instead of being developed into strong buffer state. Action at the Seattle hearing and subsequently, succeed ed:
 "1-In getting a continuation of the case until last month. This permitted OPA to complete its AL aska survey. and enabled Don O'Connor to act effectively as AL aska's economist at the hearing.
 "2-In prevailing upon the Re- conversion Director to cause VISA to continue the operation at exist ing rates beyond the original March 30th deadline-this at a sav- ing to Alaska shippers and con sumers of about three-quarters of a million dollars per month since that time.
 "3-In prevailing upon VISA to make it's own analysis based on l945 experience in lieu of the guess work which the companies had in troduced at the Seattle hearing.
 What looked like an immediate disaster last November does not now look so black. VISA will likely operate the ships at existing rates for another six months at least, during which time the postwar tur- moil might abate to some extent and some evidence of stabilization make an appearance.
 Loss Not So Great
 "One of the reasons why VISA is not now so reluctant to continue the operation is that its own an- alysis based on actual 1945 exper- fence shows that about 15 percent increase in freight rates and fares would have entirely covered the l945 operation.
 Accordingly, if it were not for stoppages thus far caused by labor troubles, the prognosis for l946 would not be too bad. However, the management portion of the Alaska operation shares with labor in showing no great standards of ef- ficiency, and the consumer has been paying for marked inefficien- cy. For instance, MT. Skinner, of Alaska Steamship Co., who is new to the steamship business, says that it has been many years since the rate schedule has been analysed and overhauled as to individual commodity rates and that the pre- sent schedule of base rates is out of date, and that he would have a study made for VISA if directed to do so.
 Thus it is apparent that VISA should rewrite the entire schedule
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