Evening star., 1950-07-16


the business. Pan American, the
worlds largest international op-
orator, and eminently successful
in the foreign field, was happy to
buy out this competitor, subject
to the approval of the Govern
ment's regulatory agency, the
Civil Aeronautics Board. and the
President.
In older and more prosaic lines
Of business, comparable trans
action doubtless would have been
happily or philosophically ac-
cepted as a good deal all around,
promptly executed and long since
forgotten. But in this volatile &C.
tivity called air transportation,
still pioneering, still pathf1nding
and intensively competitive in its
effort to consolidate its gains into
permanent rights and franchises,
that announcement has generated
new situations and complications.
Some are explainable, others yet
to be. The whole has produced a
most disturbing effect on the
White House, the CAB, the par
ticipating airlines and Federal
Judge who was aroused at 2 in
the morning to sign a paper that
prevented the President of the
United States from having his
way, at least Immediately.
In this space on January 8 and
Is, the involved background of
the proposed purchase and it's re-
lation to the future role of the
United States in international
transportation was discussed in
substantial detail Ito evaluate the
news to come in the next few
weeks and beyond" It was occa-
stoned by the 189-page report and
recommendation of Examiner
Thomas L. Wrenn to the Civil
Aeronautics Board that the pur-
chase of American Overseas Air
lines by Pan American for ST.
450, 900 be approved and its 5000
mile route from New York to
London and Northern Europe be
merged with Pan Americans New
York-to-London route which con-
tinues on through Central Europe
out to India.
Favored by Examiner
From the date of this recon-
mendation, December %, 1949,
until early In March, 1850, ex-
pansive and expensive legal argu-
ments were showered on the five-
member CAB which then entered
into a long period Of solemn delib-
Grafton on what was rapidly be-
coming the hottest case ever pre-
sented before it in its 12-year his
tory. Finally arriving at a deci-
sion on May II, the board stood
3 to 2 against the purchase of
American Overseas AirlineS by
Pan American "a reversal of the
examiners recommendation and
a not uncommon practice) and by
the majority vote held that the
temporary certificates to fly the
North Atlantic issued in July, 1945,
to Pan American, AOA and TWA,
and due to expire in 1852, should
run their normal course. AS the
expiration date approached, how
ever. the board would re-examine
the situation with the view to
determining adjustments in the
route patterns as well as the quail
if1cationS of the operators to re-
ceive permanent certificates.
Shortly after the CABS major
lty decision against the merger
OF the two international air lines,
the case was sent to the White
House for President Truman's
final action, he being brought into
this in accordance with past in
depreciation Of the law when CAB
decisions concerned international
air routes.
Events. directly and indirectly
sprouting from this very hot DO
tato, and others occurring by sheer
coincidence but adding to the
mounting confusion. began to take
form after the board entered upon
what was hoped to be the last
phase of the case. And most of
them came to light within the last
fortnight and in such a mysteri-
GUS manner as to raise the uues-
ton as to whether this case, now
going on two years of age, ever
would be settled so that all con-
cerned, including the President
OF the United States, could get on
with their work.
Since Friday morning, June 80.
the press and the interested
parties had been given to under
stand that the merger decision
would be issued momentarily, AS
unexplained postponements con-
tinued to develop, so did the spec
uIatlon as to what all was going
on behind the scenes at both the
Whlte House and in the CAB. And
the newsworthy story-to-be began
10 appreciate in value hourly as
its failure to materialize gradually
turned into mystery, suspicion
dlstrust and wild-eyed runors
that accompany such an OPAQUE
condition.
Chairman Suddenly Quit |
Then came the first of several
intriguing events. Last Saturday
the White House announced the
acceptance of the resignation of
Joseph j. o'Connell, jr., chairman
of the Civil Aeronautics Board,
effective at the close of business
on that same day. It wasn't known
then, but Mr.. O'Connell, together
with Board Member Russell B
Adams, had, on May II. expressed
themselves emphatically against
the proposed merger and had some
very unkind words for Pan Ameri- |
can Airways. Mr.. O'Connell had
been drafted into the post on
April s, 1948, on recommendation
o1 Treasury Secretary Snyder
= 49, l.