(UNTITLED)

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP78-01617A004300060001-7
• Release Decision: RIFPUB
• Original Classification: R
• Document Page Count: 125
• Document Creation Date: January 4, 2017
• Document Release Date: March 11, 2013
• Sequence Number: 1
• Content Type: REPORT

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,GOVERNMENT TRANSPORTATION POLICY
1
IN SELECTED COUNTRIES
VOLUME II-
RAILWAYS
HIGHWAYS
CENTRAL INTELLIGENCE AGENCY
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aerintit'D
UNITED KINGDOM RAILWAY TRANFPORTATION
POLICIES
? 1. Policy of the UK with respect to rail transportation will
be fUndamontally altered by the Traasport act, scheduled
to become effective 1 January 1948. Historically, policy
of the UK toward the ruil linos has been one of non-inter-
ference in private enterprise. Under the provisions of
the Transport tot, private ownership till be terminated and
, the government will take possession o2 the railroads. The
Lot provides that the rail lines, witl certain minor exceptions,
will be controlled by a Transport Cosmaission, under the
Ministry of Transport, which will have authority "to parry
Goods and passengers by rail, road and inland waterways."
Direct managerial functions will be vested in a railway .
executive, appointed by the Transport Commission. .The Commission
will have authority to curry on, with Minor exceptions, all
of the oimrations previously perforMed by the railroads under
private management.. The present position of the state as toe.
? controllinG factor in rail operations dates from 1 September
? 1939, when the_ Ministry-of Transport, under the Defense of the
Realm Lot, assumed_ control of the four main lino- railway
companies, the London Pussencer Transport board, and certain
other railway undertakings in Groat Britain. Ls a result of
this stop, certain financial arrangements were made between
the operators and the Linistry which provided for pooling of
not revenues, with certain exceptions, and for annual payments
from such pooling arrangements equivalent to the average net
revenues of the rail companies for the yours 1935, 1936 and
1937. Tho London Passenger Transport Board was guaranteed u
sum equivalent to its not revenue in the year ended June 393.
The a,;reemont provided, furthermore, that after' such payments
had boon made, any balance in the pool up to h 3,500,000 was
? to be paid to the rail lines and the Transport board in pro-
portion to their respective guaranteed net revenues.
The government will reimburse the four railway companies, whose
operations are now to be taken over under the Transport i.ot,
on the basis of the stock market value of their shares as of
1 November - 8, November 1946. Under-this plan, the shareholders
will receive only about r 22,700,000 for the four lines whose
capitalization is t 1,101.000,000.
2. Policies with respect to the rail lineS arc presently deter-
mined by the anistry of Transport and they are subject to u
high degree of integration and central administration bi the
lanistry. Policies with respect to the coordination of rail.
and sou transport are, relatively unimportant. . (Coordination
of coastwise shipping and inland waterway policies with those
of rail linos has been accomplished through private comittoes
and associations.) Tho Railuay Aar Services Ltd, was established
in 1934 in, ordor to integrate rail and air operations. .The
integration of surface and air activities is further assured
by a recent decision of the British Government that the Beards
of Directors of tne three government controlled airlines (LE:L,
D0hC and shall include representatives of shipping and
rail circles.
Document Nee 0 i)
? NO CHANGE in Class. Li ceplgai
)(le DECLASSIFIED
Class. CHANGED-TO: TS $ 0 '
DDA Memo, 4 Apr 77
? RFerP PrZ01-1) Auth: DDA REG. /7/1701
'Date: /4P/0 14 7 r By: 4.1114___.:
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UNITED 'KINGDOM - RAIL:AY TRANFPORTATION (te=3)
S. Rail policies in the UK have boonformulated primarily upon
the economic roeuirenents or the country. Llthouh little
construotion, other than repair of war damano, has been
carried on in recent years, there is no doubt that strategic
considerations mould greatly influence a deeision to under-
take new construction.
4. Since the earliest days of railway development in the UK,
the question of outright state subsidies has received little
consideration. Before the war, ihe four main line companies
comprisinz the major portion of the state's rail system made'
money steadily, never wont into a receivership, and, in fact,
entered the recent war in bettor financial shape than did
US railroads. During the depression of the late thirties,
the financial decline of the British railways was in no may
conparable to that experienced by most US rail interests.
Britiih rail operators spent proportionately more on capital
renewals than did the US railroads, and merle 4 practice of
setting up specific funds for maintenance and additions out
of operating expanses (a practice not required of US rail
carriora until 1943). The present thosnolia difficulties
of the British rail lines can be traced directly to. the war.
Rollin; stock and facilities suffered enormous damage from
anew action, and the' present acute shortcee of materials and
the policy of the government toward imports have operated
against any substantial improvonents in rail transport.
5. British railways, in the past, wore privately owned and were
little affected by state policy until recent years. -Policy
with respect to their operations was influenced primarily
by vested interests represented by the stockholders; geo-
nraphic, historic and political conditions have ecerted only
u secondary influence.
B. O1tG.i1174.TIOlf ?
1. Railway operations are under the jurisdiction of the Ministry
of Transport. Until the Transport Let becomes operative,
1 January 1948, the followinn offices, within the anistry
are concerned with railway problems: (a) The office of rail-
ways doulp with rail Operations; (b) The Railway Executive
Committee, established in 1939,?implements state railway
policy; and (c) The Railway Rates Tribunal; established by.
the Railways act of 1921, authorizes rail rates. In addition
to the agencies mentioned.abovo,..there aro in the UK annumbor
of private and state-sponsored organisations dealing with -
railway problems. ,
2. Tho Office of Railways is the permanent .affice within the
Liinistry of Transport dealiin; with all aspects of railway
operations.. This office is to be abolished 1 January 1948 and
its functions are to be aseuned by a Transport Conmiszion
appointed by the Ministry of Transportation. The Railway
Executive Committee and the Railway Rates Tribunal will
continue to function as in the past.
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UNITED KIM= a RAILRAY TRANSPORTATION (84)
:The various agencies dealing with rail operations are administra-
tively separate, but coordinate closely in dealing with problems ?
of mutual interest. Ahoy are subject to controlled diroct ion
. and coordination by tho Ministry. TheTe is no direct connection .
betweun the agencies conoorned with rail operations and those .
concerned with shipping and civil aviation, except in the
establishnent and operation of coordinated policies.
4. The present status of railway control under authority of the
Ministry dates back to the Ministry of Transport Let, 1919, .
which transferred to the Ministry the powers and duties former-
ly exercised by other govornment departments in relation to the
various media. of tranSport.
5. although tho Ministry of, Transport is generally conceded to he
?erfortAas,; exceptionally well in view of the iresent critical
? conditions in tho UK, thero,is considerable opposition to the
labor govornnent's policics,,both present and contemplated,
? with respect to state ownership and operation of transport
laoilities. The railway companies insist that nationalization
at tho present tine will be disastrous, that further unifica-
tion of nunagomant is undesirable, that tho rail linos should
retain their statutory right to earn rovonues fixed by law, and
that tho present plans of the Ministry will completoly dis-.
i-upt rail facilities within the state.
C. altaiLESTIVITIOU
1. The ostublishmont of now railway lines is authorized by the
1.1inistry of Transport.
2. Elo Railway,Ratos Tribunal, created by the Railways Lot of
1921, is tho authority rosponsiblo for fixing rail rates.
The Tribunal holds unnual'inVostigations of railway operating
results, and rulings with respect to establishnont of rates
aro based upon Duch invostiations. Historically, 'British
rail rates have boon based on tho value of the i;oods conveyed.
The railway companies have thus boon able to charge exceptionally
high rates for sono traflic, while at tho maw ting; they wens
conpallod to carry coal. and other raw material at very low
rates. This ad valorem principle employed by the railways has
resulted in a rapid increase of highway trucking of certain.
typos of goods at cheaper rates.
3. Cevotition to the rail carrion in tho UK has boLn offered
primarily by highway transport. Tho ad valorem principle
nontionod in 2. abovo, plus the comparative freedom of
operations alloyed the road operators, has diverted a largo
volume of high-class traffic from the railroads. Competition
Iron tho road transport oporators seriously threatonod the
financial position of the rail linos, and in 1998 the rail
operators requested the Ministry of Transport to rovise rate
structures and regulations to enable torn to compete with the
the road operators. trifling oat of this request, a Joint'
Conference was ibrmed shortly before the war to revise rate
structures and to /coordinate such structures for road and .
rail servicd. Llthough the work of this Conforonco was intor-
- .*
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UNITFD KINGDOM
RAIL"AY TRANSPORTATION (C..3 CMT'D)
? ruptod by the var,conSiderahle progress toward rate structure
coordination has boon accomplished. Under the provisions of
the TransportAot, further coordination of road and rtils
will be carrietiout and competition between those two media
will be largely'restrictod.
5. It does not appear that the state is participating in the
training of tooltniciGns for rail transport. The railroad
pporatars, however, have instituted stuff training schemes,
and Schools of Transport fortraining of personnel have been
established. It-is planned to extend such training under
govornmentownorship to practically all classes of personnel
in the railroad industry.
6. Because of Ms goographicisolation, international agreements
concsrning interchange of traffic, joint facilities, rate-
fizing, and other problems which in other countries are of
considerable magnitude, are of littleimportance in the UK.
Ln exception to this is the operation of "train-ferries"
by t.o of the major railroads, Tho London'und-North Eastern
Railway operates three ferry boats, each capable of carrying
45 freight cars of 20 ton capacity between darwich and
Zeebrugge, Belgium. Tho Southern Company operatoo three chips
of about-5000. tons capacity, each capable of carrying 40
freight curs or 12 passenger carp between Dover ,and Ounklrh.
Those. operations are carried out und.ir international '
-agreements between the countries concerned.
7. Railroads are required to file income statements with the
anistry of Transport, in accordance with the provisions of
the Railway Companies (Accounts and Returns) Act, 1911. Those
-
statements aro similar in content to those required by the
Interstate Conmrce Comission with respect to the operations,
of Cie US railroads.
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TRANSPORTATION - FRANCE
THE SUPHEME'TRANMPORTATIOD ADVIODRY BOARD
107.: The following information was not available during
the preparation of this study. .
? 1. The most important development in French transportation since
the war is the establishment by the National Assembly in August 1947 of
a Supreme Transportation Advisory Board. The Board will advise the '
Minister of Public 7orks and Transport on all transportation matters
submitted to it, but may also formulate recommendations on its own
initiative. The Advisory Board's immediate mission is to present,
within one yo:kr, plans for the coordination of rail, highway, inland
raterwayl-air and ocean transportation. It will include in its Plans
coordination of domestic transport with colonial and international
transportation. The Board rill study all social, technical, financial
and econdtic matters relative to the organization and functioning of
the various modes of tranlportation; it will also study matters concern-
ing stock and equipment, technical abd commercial development and the
social, economic and administrative problems arising therefrom.
2. The Supreme TranspOrtation advisory Board is established under
the Minister of Public 7orks.and Transport.and?consists,of 69 members,
including representatives from various government agencies, .members of
Parliament, specialiets from the large transport organizations, employee
representatives from the operating companies and publid organizations
such as tourist travel agencies. Feven permanent commissions are estab-
lished under the Board, charged with examining questions of transport
coordination. .These are as follows:
Rail
Rail -
Rail -
Rail. ?
Highway -
Highway -
Sea - ?
highway
inland ratenvay
sea
air
inland waterway
air
3. The Supreme Transportation Advisory Board is financed through
a special fund provided by the Minister of Public -orks and Transport.
The sum expended shall be reimbursed?to the state by the various trans-
portation operators under conditions to be set forth by decree of the
Minister of Public -orks and Transport and the Minister of Finance.
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FRANCE - RAILWAY TRANSPORTATION
A. POLICIES
1. French Government policy, over a long period of time, has been
to foster the development of rail transport through legal, fi-
nancial and administrative assistance of various types. French
rail policy attempts to avoid both outright private operation'
-and complete Government ownership by having the roads remain
under corporate form with the state awning 51 per cent of the
stock.
2. French rail policies are determined by the Department 'of Rail-
roads and Transport (DIRECTION CENERAIS des CHEMINS de FER et
des TRANSPORTS) which possesses considerable freedom of action
under the authority of the Ministry of Public Works and Trans-
port (VINISTERE des TRAVAUX PUBLIQUES et des TRANSPORTS). Rail
policies are integrated into the over-all transport policy as
determined by the Ministry.
3. Systematic planning of rail facilities has been a traditional
feature of the transport policy of the state. The rail policy
of France was historically greatly influenced by the German
strategic Policy with regard to railroads under Von Moltke. .
It is probable that French rail development was greatly expe-
dited by the apparent emphasis which her neighbor across the,
Rhine placed upon rail network development. Recent strategic
policy with regard to railroads has been to attempt to counter-
act, insofar as possible, any transport plans of neighboring
states which might threaten national security.
4. The French Government has always promoted, development of
.
rail facilities, and the state has been very liberal in sub-
sidizing and otherwise encouraging such.dtivelopment.
? 5. French rail policy has been influenced principally by political
and economic conditions. While political conditions furnished
the first great impetus, it is evident that the economic needs
.of the country have generally determined the eventual course
of railroad policy (except during those periods when military
policy determined that. national security transcended other fac-
'tors).',
B. ORGANIZATION
1. The rail system of France is under the direction of the Depart-
ment of Railroads and Transport (DIRECTION GENERALE des CHEMINS
de PER et des TRANSPORTS) in the Ministry or Public Works and
Transport.
2. The Department of Railroads and Transport is organized into
six offices. Of these, five deal with the various aspects of
railroad management, Such as: (a) administration (b) finance,
(c) control, (d) technical developments, and (e) labor. The
sixth deals with over-all coordination of rail and road trans-
port.
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FRANCE - RAILWAY TRANSPORTATION (B-3 CORM)
3. The Department of Railroads and Transport is an independent
agency in the Ministry. It has no direct relation to any
Other agency in the Ministry, the Ministry performing the func-
tions of such coordination and over-all control as are found
necessary. The rail system is related to shipping. and civil
air functions only through the over-all administration of the
Ministry.
From the earliest days of French railroads a century ago, the
state has shown great interest in their development, and the
present unationalized" rail system is the logical sequence of
state policy as developed over the years.
5. In the light of present conditions, it is believed that oper-
ations are as efficient as can be expected in -vier of the eco-
nomic disruptions and rolling stock shortages due to the war.
C. ADMINISTRATION
2. Proposed rail rates are prepared by the railroads and submitted
to the Ministry for study and approval. If the proposed rates
appear justified, they are approved. In case of disapproval,
the railroad has the right of appeal to Parliament for debate
and decision.
In March 1947, the French National Railways brought into oper-
ation a completely revised system of rates for freight traf-
fic. The new system is the outcome of several years of de-
tailed investigation. Prior to the new system, freight rates
were based on the ad valorem principle. (High rates for high-
value cargo regardless of weight or difficulty of handling.)
From a national policy standpoint the ad valorem principle had
many advantages, but from the standpoint of the rail system,
such policy was not entirely satisfactory. As long as rails
had a practical monopoly the system worked well, but as soon
as competition with other forms of transport developed, the
railroads were placed in an unfavorable position, since the ad
valorem principle disregarded the actual cost of such trans;-
port, while road haulage rates were based on an entirely dif-
ferent principle and took much of the high-value traffic away
from the railroads. The new revised freight rate principles
include the following points: freight shall not be carried at
a rate less than cost; rates for each class of merchandise
shall be scaled to meet the level of charges by competing forms
of transportation; and, more efficient car loading procedures
shall be designed to effect necessary economies. Virtually
every coMmodity has been covered under the new freight rates
with the exception of livestock, certain types of road vehicles,
and certain high-value commodities, such as precious stones and
securities. The present rate system is considered to be a dis-
tinct advance over the former policy of charging as much as ?
the traffic would bear and is expected to equate, as fai as
practicable, rail charges with road rates and still allow an
area of competition between the media.
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IALAJIINIVIUW
FRANCE - RAIMAY TRANSPORTATION (O-3 CUM))
3. The rail system and the water carriers have a distinct advan-
tage over highway transport, since rail and water carriers
receive state aid, while highway carriers do not. (Policies
on competition between competing modes of transport are de-
scribed in C-2.) It is not likely that the acute competi-
tion that developed between road and rail facilities in the
thirties will be allowed to recur, because this experience
proved that each held certain natural, advantages which could
not 'be overcome by rate cutting or by traffic practices that
eventually proved disastrous to both.
It. Inspection of equipment and safety regulations are the re-
sponsibility of the rail lines under the supervision of the
Controller of Public Works in the Ministry of Public Works.
and Transport. European international standards are followed
and enforcement of inspection and safety regulations is under-
taken by both railroad and state inspectors.
5. The railroads provide technical training courses at tile ECOLE
POLYTTCHNIQUE, which is state-controlled. The government
evidences keen interest in the training of transport techni-
cians.
6. The government, through its control of the French rail system,
has committed the railroads to a policy of participation in
international agreements on exchange of traffic and related
problems; in addition it has concluded a number of bilateral
agreements with other countries regarding ,such matters.
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1
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jiETIIERLANDS
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RAILWAY TRANSPORTATION
A. POLICIES
1. Railways of the Netherlands are state-owned and operated.
Rail policy is determined by the state through the Mini-
stry of Transport. The government is concerned, at present,
with rehabilitation of the railways which surfered extensive
war damage. Pre-war studies indicate that: rails accounted
for only 15 per cent of all traffic; the principal mode of
transport; insofar as freight is concerned, is by water;
rails, however, account for the bulk of passenger traffic;
and passenger revenues exceed freight revenues on the rail-
roads. It may be expected that rails will assume increasing
.importAnce in Petherlands transport as war damage is elimi-
nated and the need grown for rapid transit.
2. Rail policies are determined by the Netherlands Railways
Company under the supervision of the Ministry of Transport.
Policies for rail transport, while determined independently
from other forms of transport, are subject to integration and
central administration by the Ministry.
3. The vulnerability of the Dutch railways was amply demonstrated
during the war. Strategic considerations, however, have had
little effect on development of the railways, which lie off
the main European east-rest traffic routes, and serve a Tour
pose primarily domestic.
4. Under the policy of complete ownership and control of rail ?
transport, the state is directly concerned with the development
of new equipment and the replacing of ways and rolling stock
destroyed by the war. Since the end of the war, the state has
directed large, sums of money to reconstruction work.
5. State policy with respect to railroads has been developed
primarily under the impact of economic and political forces.
The geography of the country dictated that first efforts toward
transport development be directed toward the waterways but
during recent years (since c.1900), the state has recognized
that railroads offer probably the best all-around transport
system. Rail policy is now influenced considerably by the
rapid strides made by highway transportation.
B, ORGANIZATION
1. The railroad system of the Netherlands is under the authority
of the Ministry of Transport. However, actual operation of
the lines is under the jurisdiction of the Committee of Man-
agement of the Netherlands Railways Company. A Rate Commis*
sion,Andependent of the Ministry of Transport approves 'rates
for all forms of transportation.
2. The Committee of Management is appointed by the Ministry. of
Transport. It has complete control over railway operations.
The Committee is composed of representatives of both state
and private enterprise. .
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EMMAUS ? &Ala TRANSPOWC_SAralpt21
3. The various agencies within the Ministry of Transport dealing
with the several media of transportation are not related to
each other. The Ministry, however, coordinates all transport
policy.
4. The present Ministry of Tranoport was established by the Royal
Decree of 18 July 1946, which also abolished the old Ministry
of Transport and Power. By the same decree?, the Ministry of
Shipping was abolished and its functions were assumed by the
Ministry of Transport.
5. The rail system of the Netherlands was badly damaged in 1940
by the retreating Dutch Army and later by Allied bombing and by
the German policy of retribution for the rail strike in Septem-
ber 1944, called as an aid to the Allied effort. The rail sys-
tem is recovering its pre-war efficiency as fast as shortages
of material and rolling stock will permit. The Ministry of
Transport appears to be operating efficiently and in the public
interest.
C. ADMINISTRATION
11. The state, through its ownership of the rail system determines
the program for construction or extension of rail lines. Such
plans must be clearly in the national interest and necessary to
the general welfare.
2. Rates on all transport must be approved by the Rate Commission,
similar in function to the US Interstate Commerce Commission.
3. The state does not favor competition between the state-owned
rail lines and the privately-owned water carriers. Such com-
petition was one Of the primary causes for the state's action
In organizing the railroads into a state-owned company. The
action of the state in recent years leads observers, and par-
ticularly the water carriers, to believe that the state is
attempting to move away from its traditional policy of depend-
ence upon inland waterways.
4. There is no state agency dealing specifically with inspection
of equipment, but the Scientific Commercial Car Institute, a
private organization, contracts to inspect cars and issue cer-
tificates of loading capacities.
3. Technical education in the Netherlands is sponsored increas-
ingly by the state and consists of full and part-tine training
covering a wide range of trades and professions. Excellent
training courses for railroad technicians are provided by the
rtate University at Delft. The state does not sponsor railroad
training, hoiever? to the extent that it sponsors training in
navigation (inland and ocean-going).
6. The railroads of the Netherlands are a party to the Bern Con-
vention regarding traffic, rates, facilities and related inter-
national traffic matters.
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USSR - RLlIfljT TREATSPORTaTICII
A. ?DUCT LS
1. Barrie Soviet policy with respect to reilway transport
tion is expressed in the currant Five-Year Plan. The
plan 'Sate in first placci among the 25 major tasks con.
fronting the na%.onta economy, "tam rentoratiors and develop-
ment of lieuvy industry end railway transport, vithout Which
the rapid and of native recovery and development of the '
entire nutionul esoreroy of the USSR would be impossible."
The foregoing text is significantly lorded. Repeated
mention of war damage rootaration ahoud of' new development
reflects 'the roost dotorraining rector in the Soviet. railway
problem. While new construction : is in progress to satisfy
the expanding Soviet'induatrialization tt,TKI the geographic
readjustments of pact-war Soviet industry, the major emphasis
for some time will be placed upon repairing war damage in
? areas of %Jarman occupation, shore rail capacities are still
below rd.:timers levels demanded by the National interest.
Railway policy, except on minor matters, is exclusively
determined by the State et high political levels. The rail-
ore viewed by the government solely us an economic in,.
striatum* of national policy. Zonsidorations such us con-
venience of the public, the interests of private ovmership,
.or the requircannts of industry, which would strongly in-
flounce railway policy in other countries,. aro of little or
no importance in the USSR, %there the r.ailvaar system swat be
responsive to over-all economic planting, which itself is
essentially a manifeatution of the Communist Party's
political will.
2. In the USSR, policy for the various media of transportation
is administered primarily by separate ?comics, ulthough
coordination in administration out be enforced, if necessary,
by the State Manning Commission (Gosplan). In the determina-
tion of policy, on the other hand, there is little latitude
for independent cotton, because all important aspects of
transportation policy must be approved by the State Planning
Commission (and on occasion by the Politburo of the Party).
lharause the note Manning Coariasien is charged with es-
tablishing over-all economic policy responsive to the Putts
political will, and is disinterested in the narrow points
of view of individual. interests, integration of policy at
the planning level is thus theoretically assured.
3. Economic consideratione originally determined tho pattern
of the Russian network, and prior to tend Vier II strategic
and military consideratians did not strongly influence rail
policy, although crocasionally, as in the Siberian lazitime
Provinces, railroad construction Was undertaken it th sub-
stantially strategic objectives.
iSSIR I CTEQ
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RESTR I CTED
USSR - &MUT TELaHSPORSCLTIGIf (A-3 CULIT'D)
During torld War I/ the USSR carried out some major
emergency railroad construction solely for military
reasons, and administration of lines under Soviet control
was directed exclusively toward meeting the demands of
the vax.effort.
The announced future development of Soviet railroads does
not appear to include major projects which are primarily
strzAtegic, although rimy projects will increase the Soviet
economics potential, and thus the srilitury'potential. There
can be little doubt, however, that the USSR hue become
more aware of the strategic implications of rail development,
or that the Soviet General Staff is carefully scrutinizing
all features of railway policy; However, it will not be
possible for the USSR rapidly to eliminate the major
strategic weaknesses such as (a) the broad gauge of Soviet
railroads, (b) the leek of reserve capac_ity,70) absence
of railways in large_noction.s-of-the_IMSR, (d) poor rail
?iuthorn connections to t?,__Lbtr assiang most_ottheJASts
boundarien? and (e) tolatively losr_potential of
the exabting trans-Siberitaa railroad. (Tho completion of
the projeotod.South Siberian trunk line, es described in
the fourth livoseYear Plan, which will not provide the USSR
with a second transcontinental rail ounneotion, is justified '
in :krelet statements on economic grounds.)
4.. As in the case of all other Soviet enterprises, state owner-
ship of railroads ;makes the question of subsidization in- ,
applicable. (Soo Merchant Shipping, 1-3).
5. Vested interests, in the usual private- sense, could not
exist in the USSR, and therefore do not influence rail 'policy.
titan the Conneaut Party, however, thirty years of power
have produced sorze measure of bureaucratic factionalism,
which might introduce conflicts at the planning level.
Historical circumstances obviously moulded the development
of ?luau and thus influenced the pattern of rail construc-
tion. No historical factor, howover, appears to exert a
determining influence on present rail policy: Geographic
conditions have alrittys influenced rail policy and still
limit the direction in which railway devolopennt oUn proceed.'
Geography and ?lir:sato, for ext.nple, have excluded railroads
from Northern Siberia, and the only rail connection from the
Atlantic to the Pucific (the Trans-Siberian) is actually a
circuitous route when compared to the groat circle from
Gibraltar to Vladivostok, which passes in the vicinity of
Leningrad and touches :the Arctic Circle. plitutte has also
produced large arid areas .in the USSR, whore water supply ,
2
VESTR I CT ED
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,RESTR I CTED
USSR - RblWwY TRAMSPURTATION (a-6 CUHT'D)
for stoaM locomotives is a major limiting factor in railway
operation. Largo rivers in the area of raility ooncentra-
tiaras (wostorn USSR) have also interposed surto G barriers
to railway conitruction. Pblitical consieorations indirectly
dominate Soviet rail policy, in the sense that thelcommnist
Perty's entire economic progrbus thioh governs rail policy.
is itself a manifestation of the Party's political will.
The progress of Soviet industrialization will provide the
major incentive to rail development, once tho extensive danago
of Vorld War II has boon repaired. tor the next few years ?
the Soviet econouv will witnosa a continuation of the race
which has boon in progress for many yours in the USSR be-
tween expanding roquirements of industry and increased
ruil-ospuoity. During this irrocons, rail facilities have
never had aubstuntial reserve capacity, nor bre they likely
to achieve this.desirablo soul during the current live-Year
Plan,
B. DRGANIZATIOH.
Maio railroad operations are administered by the Ministry
of Railways, there :aro several other Ministries whose
activities affeot railroad operation and construction.
/song those are: (a) the Ministry of the Iron and Steel
Industry. (3) the Ministry of the Transport Machine Building
Industry, and (o) the Ministry of Internal Affairs. In addi-
tion to the direct controls exorcised by the .above listed
Ministries, ouch churgod with specific functions.' al as-
pects of Soviet rbilroad policy are subject to the over-all
economic pluna of the State Planning Commission ,and the
political program of the Commun:t PartY0
3-.
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-tiasR,LALTarith
2. The Linistry of Railtays is reeponsible for the fornulation of
roil policies and administrative procedures at the Cabinet level,
anco the Linistry of the Iron one Steel Industry produces major
items required by the railroad industry, such as rails, its pro-
gram must be carefulay integrated eite projected railway plans.
Likewise, the capabilities of the :Anistry.of the Transport
!:.schino euilding In:a/am ehich constructs rolline stook- for
The railroads, must be considered. The Linistry of Internal
affairs also plays an important rola in Soviet rail plane, be-
cause it-is responsible for roadbed construction and the rail
laying.
3. etile each of the foregoing agencies is an administrative entity
and is ineependent of outside con .rol at the Cabinet level, they
are all subject to top-level direction ene coordination by the
Stete.clanning.Commiesion. a general statement with respect to
overlapping and conflicts in Soviet administrative organization
is contained in the answer to ae3 covering USSR Inland ?aterway
Transportation.
4. The present Uinietry of Railweys was originally a part or a
,Commissariae havine over-all responsibility for all transporta-
tion,. with departments to administer tee various meaia. The
development of economic planning during the past twenty years
has resulted in a re.arp compartmeatetion of transportation ad-.
ministration, so tLst today hera are separate'einistries for
railroads, inlanewaterecys, and tLe eorceant marine. there is
no evidence of' impending change in the pfssent adniniserative
structure.
5. By Soviet definition, all government agencies operate in the
public interest, because tesoy implement the Party's prorram.
On ths other hen:, even official assessment of the efficiency
of individual seencies is frequently unfavorable, as evidenced
by tress criticisms of operational end buebaucratic deficioncien.
If the efficiency of the railroads thomaelves is compared to ?
that of the US or no for example, Soviet operations appear in-
efficient in certain respects. irains operate at lea speeds,
automatic block-cignal equipment and moeern couplings are only
available in limited quantities, ear loadings and unloadings
are subject to delays, an, passenger traffic is badly neglected.
On tho other-hen? many increases in otficionce, poseponed by
the war, are now bsine effected. The average length of haul is
being reduced, heavier rails are being laid in large euantities,
long stretches oe lino ore Silt.' electrified; Liesel equipment
is being introduced, One numerous lines are being double-tracked.
The result or this program eill be a notarial adjustment upwar s
in the rail system's ability to mast the requirements of the
planned doviet.indestrial expansion. The railroads, however,
will not soon be able to offer comfortable transport to a large
volume of passeneer traefic, because the ;Fourth Five-Year elan
provides for relaeivel, minor ceestructior of paseongar cars.
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nirerers !fern%
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gas..11447.1Y Taci,DAT0TJ3K (c-ii
0 C. Ax.ruzsTaAnoN
1. Projects for the construction of nee rail linos in the USSR.
are the responsibility of the Linistry of ftaileays at the
Cabinet level. 'knells? of their importance, horever: there
is little doubt that they must be referred to all agencies,
political, economic and military, whose interests might be
effected. The final decision, in fact, is probably taken
in the State Planning Commission, or oven the eolithuro.
2. Rates for,reilreau traffic are certrelly determin2d an ap-
pay to all Soviet lines. They are eseeeliseed at a level
which' assures the return of a plennee profit to lines which
operate at 'average efficiency. The USSR may permit sub-
marginal lines, which could not show a profit on the basis
of officiel rates, to maintain the fiction of operating pro-
fits through the use of concealed special charges. In the
numerous instances weer? the donated for freight space far
exceeds the aveilabia,sueply, tee state equates supply and
demand by allocatine space on tee basis of a "complicated
system of traffic priorities, insteed of permieting rates
to be raised by the competition of shippers for space.
). Competition, it the usual sense, does not exist in the USSR,
and there is no competition for business between the various
rail lines. .(Shippers, in fact, are more likely to compete
for space.) "Socialist competition", prnuent in all forms
of transportation, is especie4yinall orgsnizei throug".out
the rail system. This activity is promoted be the trade
unions and the State in order to increase operatine effi-
ciency in such mess as eauling larger loads, speeding up
service, ene reducing the accident rate. Coepetition be
tween the railroads and the other transport media in the
sense of one media invening the logical Province of another
is theoretically eliminetee by the transport planning activi-
ties or the state.
4. There are carefully defined rules covering operating safety
and the condition of equipment on eoViet railroads. doth
equipment and persornel ere subject to purio.ic inspection:
depending upon the type of equipment or the one hend and
the nature of %/ore engaged in on tee other. In the regula-
tions great emphasis is laid upon the armed responsibieity
of Operatine personal for the condition of equipment titer
Les jurisdiction. Accidents are investigated on the spot,
such investigatione being-held in "people's courts" reere
grester empnesis is reported t) be given to the circumstances
of such mis Ape than to legal aspects. The importance eeich
the State attaches to the investieation of railnot-e- accidents
is revealed by the fact that tilitary tribunals have jurisdic-
tion to a tertein extent over the corjuct of such investiga-
tions, eaLhougt safety rogultitions are established tur.ier the
authority of tee einistry of eailways. The actual administration
e
? ?Pi:CyrnittriN
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PricIDIrerrn
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of the rules outlined above is frequently lax, and public hear-
ings regarding accidents sometimes reflect political considera-
tions beyon: the merits of the eases.
5. Technical schools are under the jurisdiction of the Linistry of
Labor Reserves. he state maintains a network of such schools
devoted exclusively to training technicians for the railroad
industry. These schools are distinct from tee technical schools
where training in transportation is given as a pert of the gen-
eral curriculum. In addition to the foregoing training, boys ?
with only elementary school educa:ion who wish to join the rail-
road industry are enrolled in tra:ie schools where tt_ty are given
training below the level required by technically skilled workers.
further trainik of selected students from the above group is
given at the college level. I; is known that Soviet workers in
theory must possess evidence of qualifications and previous
employment. Those papers an be demanded as a condition or em-
ployment.
6. International agxeements coveringrailwayoperations have been
an important feature of aoviet foreign policy since the end of
World II. In 1945; for example, the USSR solidified its
post ion in Lanchurian railwcy transportation by concluding
with China a Treaty of Iriends.ip and alliance. In connection
with,t.lis agreement, joint Soviet-Chinese ownership and ex-
ploitation of the important fainehurian trunk lines were guar-
anteed for a porioi of 3D years. The USSR is entitled to un-
impeded transit of goods from the Sevie.. naval base at 2ort
Arthur and the free port of Darien to the system's connections
with Soviet territory. Another formalegreement hes been con-
cluded with Annintnias giving the USSR preferential rights on
the acumen/en railroods. Irrespective of signed agreements,
the USSR controls railrosds in the Soviet-occupied areas of
Europe, where dmstic measures with regard to Cie utilization
of rolling stock, change of gauge, and even disbantling of
lines have been carried out.
7. Voluminous statistical and economic reports are submitted month-
13,' to the Linistry of Railways'hy the loci-level operating and
administrative groups.
6
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RESTRICTED
SWEDEN - RAILWAY TRANSPORTATI3N
h. POLICIES
1. The majority of Swedish railroads are owned by the
state. The policy of state ownership dates back to the
middle of the 19th century, and in. recent years there has
been a marked trend toward complete nationalization of
the rail eystem,of the country. The railroads are
Sweden's prime form of transport, and the bulk, of all
freight truffle, except timber and iron ore, moves hy
trail over a well-developed network, about half of which
is electrified. All policies concerning railroad ad-
ministration and operation are determined by the state
through the State Railway iadninistration (JARMAGSSTYRMSER);
2. Railroad policies are determined and administered sepa-
rately by the State Railway Administration, an independent
office in the Ministry of Communications. The Ministry
is charged with integration and.administration of all
communications and public works policies, and is the
liaison channel through which the various organizations
concerned with transport deal with the state.
3. Strategic and military considerations have had little
effect upon the determination of Swedish rail policy which
directs the railroads in furthering economic and indus-
trial considerations.
4. 'Since the government owns the major portion of the rail
system (74 per cent in narch 1940, subsidies, in the
commonly accepted usage, are of little concideration. Thia
government, however, is very active in promoting improve-
ments in equipment and operating procedures on both state-
owned and privately-operated lines.
5?. Government rail policy in Sweden has bean influenced in
recent years by economic and geographic considerations
and vested interests have relatively little direct in-
fluence.
B. ORGANIZATION
1. The agencies of government concerned with state-owned and
private lines are as fellows:
The State Railway tdmin.istrLtion (Anis-try of
Conaunications)
The Railway Council (JA.RTIVA,GSRJ.DET)
The ,State Railway Board
2, The State Railway Administration is organized by bureaus,
ouch dealing with specific problems; of administration
and operation, such as traffic, safety and finances. The
Railway Council acts as an advisory board on questions
involving nil traffic. The State Railway Board is
appointed by the government and operates through district
administrators. Representatives of the State Railway
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STR I CTED
____1.1LV;ILY TRANSPORTATION 84 ContLAL
?
Board are customarily appointed to the Board of
Directors of private rail linos to which the govern-
ment has made loans.
3. Tho State Railway Ldninistration has no direct relation
to any other transport agency, except as its operations
aro affected by over-all control and coordination with-
in the Ministry of Communications.
5, The Swedish railroad lines are considered by competent
? authorities to be among the most efficiently operated
of all state-owned systems and no public criticism is
, apparent concerning either administration or operation.
C. tLILU UI STRaTI ON
1. The :Ainistry of Communications is charged with, the re-
sponsibilityft determining the need for new rail linos
or extensions of the existing systems. The need for now
? rail facilitiesj is determined by the government in ac-
? cordance with the needs of industry and .commerce. The
Ministry .is inclined to allow privately-controlled lines ?
to develop as they see fit. It should be noted, however,
that duo to the intense competition of highway trans-
portation, no new rail construction is contemplated and
Some rail lines have either discontinuedor sharply cur-
tailed their operations.
9 Rates applicable to the stuto-operated lines are promulgated
and established by the jinistry of Communications, Rates ?
on privately-operated lines must be submitted to the
lanistry of Communications for approval. Minimum freight
and passenger rates are established by the State Rallying
Board, which has authority to effect changes under certain
conditions.
3. The principal competition to the rail lines is offered
by the highway transport carriers. The stato'does not
attempt to favor rails over hizhway carriers, despite the
financial interest of the state and as a result of this
policy, the rail linos have suffered. This is.partioular-
ly true of the 35 privately-owned and operated lines which
account for 26 per cent of the total rail mileage.
Despite the basic competitive positions of the two media,
of transport, however, a policy has been evolved which
enables both rail and road transport to organize cooperative
services for their mutual benefit.
4. The re:-,ulations applying to both state and private rail-
ways are issued and enforced by the Royal Railway Board,
whose decisions in all major mutters arc subject to the
approval of the government, and in specific cases, of the
Riksdag.
RESTR I CTED
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RESTR 1 CTED
SWEDEN . MILLIS TRIZSIORTATION (C-5) -
5, There' are a 'inzaber of toChrxict.1 schools yhich are either
state-operatod or stt-te-subsidized, offering courses in
technic-Nal trdnin Tho Royal School of Tochnstcycy in
Stockholm, ;Aid the Choir:tors Technical College at -..loteborg
a.ro examples. ?
6, Sweden is. a. party to many international agreomonts concern-
ing
?
tirt;fi'ic fLci1itis, n?.tos Lind othur
problems.
cre-rolr'rrn
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(.) Ao POLICIES
PRE-WAR GER?/ANY RAILWAY TRANSPORTATION
10 The Reiohsbahn law of July 4, 19390 was the final definition
of the position of the German National Railroad: its inter-
nal organization, its financial status, its relationship to
the Government and other public bodies and undertakings.
Paradoxically, the Reichsbahn must be desCribed as a com-
pletely state-owned enterprise which.still enjoyed financial0
adminintrative and operating autonomy* As a juristic person,
it administered all its operations under its own responsi-
bility* Its peculiar status under the legal device of a
"Sonderverni8gen des Belches" (Special Property of the Nation)
gave it the self-government necessary for successful opera-
tion, though "belonging to the Reich alone, influenced by the
Reich alone, and responsible to the Reich alone". .The only
injunction expressly laid on the Reichsbahn was that it was
not to consider itself as a profit enterprise but as a pub-
lic service which had to be self-supporting at the same time.
The transportation policy of the German Governments between
the wars transcended the usual duties of regulation of abuses
? arising from monopolistic tendencies, or the general protec-
tion of the public interest* The preamble to the law on
land passenger traffic of December 8, 19370 expresses the
German attitude in these words:
"In the National Socialist state the leadership
(Flihrung) in regard to transportation is e task of
the State* The means .of transportation can be
operated either by private persons or by public
bodies. But. ell must subject 'themselves to the
rules which are framed uniformly for the whole
Reich* Each branch of transportation must be ago
signed those tasks which it is likely to serve in
the best possible manner within the frame of the
whole transportation system and of the national
economy*"
In transportation, as in other phases of economic activity.
the Nazi state brought to completion tendencies already ex-
isting, for "in Germany the concept of transportation
(Verkehrsgedanke) has always been most iniAmately bound up
with the concept of the National State (Reiohsgedanke)",
The German transport system has been "nothing other than
the expression ,of the political and politico-economic ideas"
of Germany*
Paragraph I of the law of February 17, 1934, charged the
Reich Minister of Transport with the organization of the
whole system of surface transportation on the basis of
this conception of uniform control* The way had been pre-
pared for him by the nationalization of the state railroads
and the main highways, the inauguration of motor transport
reguletion, and the assumption by the Hitlerian State of
broad powers after the eradication of the states as politi-
cal entities* More than 00% of the trucks, about 50% of
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PRE-WAR GERMANY - RAILWAY TRANSPORTATION (A-1 CONTT)
the buses, and most of the river vessels Were permitted to
remain privately-owned and operated. However, the Ministry,
by means of the '"self-governing" Transport Groups? exer-
cised Par-reaching control on the transportation services
and auxiliary enterprises not immediately awned by the
Government, Hence, the German Ministry of Transport from
1934 to 1939 exercised the functions of a railway board of
managers for the Reichsbahn0- combined with responsibilities
similar to those of the. US Interstate Commerce Commission
and of the US Maritime Commission as regards the remaining .
carriers.
In pre-war years such aa 1937, the Reichsbahn handled about
73g of all freight traffic of the oaUntry, as against 3g
handled by privately-owned railway lines, 21 1/2% by watera.
way carriers and 2 1/2% by highray.vehieles, In the pas-
senger field, statistical evidence is less complete, but
the Reichsbahn apparently conducted some 70% of all passen-
ger travel, privately-owned railways about 3%, and the
meter carriers about 27%0 much of Which was purely local
business. In physical extent1, the inland waterways (streams
and canals) totaled 12,000 kilometers8 the railroad net
80,000 kilometers,, and the road net (including the Auto-
hahnen) 250.000 kilometers.
The following indicates generally the proportions of the
pre-war division of traffic!
Type of Transportation
Private railways
State. railways
(the Reichsbahn)
Waterways
Highways
Freight Tons
3,700,000,000
97,8320600,000
28,972,600,000
3025400000000
Passengers
220200,000
6180204,100
214,000,000
Total 133,759,200,000 8810404400
2. The law of Febniary 170 19340 combined in the National
Transport Ministry the governmental regulation of all model
of surface transportntion with the management of the ne.-0
tional railroads. The glaring exception to the "uniformity
of control" prescribed by this law was the independent ad-
ministrative position of Dr. Fritz Todt0 succeeded by
Alfred Speer, as General Inspector of the German Road System.
Although the posts of Minister of Transport and General
Manager of the Reichsbahn were combined in one person after
19370 the Transport Ministry,.thriugh its railroad depart-
ments, administered the railroads on'a basis of extreme
decentralization.
3. The Germans wore among the. first to recognize that the .
"armed forces of a nation are not a thing in themselvesobut
nn expression of the entire state and folk structureo A
real people in arms must utilise for the-purposes of national
- 2 -
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RESTR I CTED
PREc.WAR GETrAUY PAIVAV TRANFRORTATION (A03 COMM)
defense everything that the land and its characteristics pro-
vided*, An industrialired state must possess armed forces
that use all the possibilities of industry", This concept is
that which General Thomas, Chief of the 2:ilitary-Economics
Section of the German General Staff0 called "depth of arms?
mane, and which is usually described in Ludendorff's phraie
as "total war", -"A certain military political meaning can be
demonstrated for every branch of politics", The place of
transportation in this scheme of grand strategy is subordi,
nated to the general needs of the economy, "The principle is
that transportation does not exist for itself? but has its.
only meaning and justification in serving the country's
economy", The Yittelland canal, for example0 was conceived
in terms of the huge Hermann Ggring works at. Salegittor.
The roles assigned to transport in theoretical considerations
of strategy were therefore secondary to its economic impor-
tance in the war potential? At the same time, German trans-
portation was in a state of all but complete mobiliration
even before the outbreak of war, Most obviously, pre-war
physical transportation facilities far exceeded the demands
of a normal peace time industry & That the restrictions on
highway and inland waterway tOiffic were kept in force until
1938 demonstrates that neither the Autobahnen nor the canals
fulfilled essential needs, "If from many sides critical
opinions are heard which nroclaim our overcapacity, it still
remains an enduring principle that a responsible government
plans and creates all traffic means and establishments in
terms of the future, In transportation9 potential must be
greater than immediate transport needs, The best example is
the building of the Autobnhnen ordered by the Fuhrer,"
The strategic meaning of the Reichsbahn in Nazi thinking is
illustrated by a significant change in the wording of the
fundamental laws, Paragraph 2 of the laws of August 300
1924, and March 13, 1930; agreed that the Reichsbahn was "to
conduct its operations for the preservation of the German
folk economy under business prindiples," In section 30 pare?
graph 3, the law of July 4, 19390 provided that the "Peichs-
bahn is to be administered for the use of the German people;
in this connection, the importance of the national defense
is to be considered",
40 After November 1923. the German Reichsbahn received no finan-
cial subsidy from the Reich, On the contrary. from 1924 to
1931 the railroad paid sums approximating 660 million
annually for repnrations under the Dawes plan, and at the
same time a transportation tax averaging 290 million PM an-
nually, After the end of reparations, s fixed sum of 70
million PM was Taid annually in addition to the transport
tax, With the expansion of German industry under the Maris.
the Reichsbahn was celled on to contribute even more sub-
stantially to the Government& In 19370 a plan was worked
out whereby 3% of a total under 4 billion RM. and 971, of any
sum over 4 billion RP, were to be turned over to the Govern-
ment, The amounts for 1937 and 1g38 were 15708 million RM
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? PREe,WAR GMANY RAIL7wAY TRANSPORTATION (A-.4 COTITID)
and 193.4 million RV respectively? In addition to these sums
the Reichsbahn paid the transport tax, which for 1937 was
25407 million RN and for 193,A0 286,7 million W.. The law of
July 4;1939, on the assumption that with the absorption of
the Austrian, Sudeten, and renel lines a total operating ine?
come of 4.5 billion RM might be expected, provided that 3% of
this amount--nnd in no ease less than 100 million RM annually
nhould be paid to the Nation, Thin was to be treated, as opera-
ting expense? In addition, it vas provided that the contribu-
tion should be increased or decreased by 10% of the amount of
which the total income exceeded or fell below the stated level
of 4.6 billion RM,
5. The use of the "Gomeinnutz/iches Tarifsystem" as an instr10
ment to effect Nazi economic ideas is described in C-2.
The subordination of the states to the nation was an avowed
goal of the post-Bismarckian German Notion. As part of this
policy, the eimar constitution assumed for the Reich control
of all moans of transportation, but Practice lagged behind
the expression of intention, The states fought the Reichs.
bank on the allotment of railroad stops and etations, and the
geographical definitions of administrative boundaries. Seven -
thousand local political units were involved in the admtnis-
tration of the roads. The transfer of waterways to the Reich
set for April 1, 1921, was never effected, because the states
wished to give up only the duty of maintenance, while re-
serving to themselves the right of administering flood control.,
drainage, reclamation'and miter transportation? The law of
February 17, 19340 with exceptions already noted, accomplished
the tranhport unification of Germany, to go along with the
political unification proclaimed by Hitler on January 30, 19330
In the field of what the Germans called "BevOlkerungspolitik"
(population politics) important missions were assigned the
railroad and the Autobahneno "The state has built a series
of railroads which, by private economic standards, were never
worth building, because they brought in no profit, Thinly
settled, economically poor districts have been tied up with
industrial and cultural developments. The economy of border
districts, where the populsce, because of the proximity of
the foreigner, needed particular strengthening, has been
supported." The decentralization of industry was stated as
an official government policy as early as itarch 29, .1935.
Transportation was also an agent of politics in the narrowest
sense of that wordo The canals, the Autobahnen, the com-
merical air fleet were all visible symbols of the vitality of
the new regime, as well as sources of employment for the work-
less. "At ell times the roads have been the expression of
the-culture and status of a people? The highways of ancient
Rome, of Napoleon And the Chinese Emeire? and of the Incas
bear witness to this facto Our roads also shall exist
eternally--The name Adolf :iitler obliges us to make of his
roads the exrression of our new erso"
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PRS?:WAR GnR13iNY a RAILFIAY TRANSPORTATION (A-5 CO,IT/D)
The German conception of the place of that country in thn
world geographic structure has been populariaed an the geeo
political writings of Karl Haushofer. The traffic?geographical
conditions of Germany can be summarized as* (a) the almost ?
parallel south to north course of comparatively closely
situated rivers (Rhine, ;Teter, Elbe, Oder, Vistula) which
needed only the oast-west connectione supplied by the lattel-
land and Adolf Hitler canals; (b) the influence of river val-
leys by the shaping of the mountain ranges ip the development
of the railways: (c) the full opportunities provided the
automobile by the extensive lowlands that make up the greater
part of Germanyo .
The perennial aspirations of the nationalistic intelligentsia
of Germany, Viddle Europe under German domination* and the
"Drang nach Osten" were undoubtedly conscious aims of the
German transportation policy. An example in'point is the ?
waterways? !'The prime consideration has been not whether the
way %mild be a sound economic development,. not whether tolls
received plus income from power plants would carry the fixed
charges incurred for construction, but whether the completed
natomNay would serve as an artery in a completely united end
?
self-sufficient economic area, composed of Germany and the
small states on the Danube, under the domination of Germany,
and affording basic economic security and military power."
B. ,ORGAVIZATION
10 The rinistry of Transport Was concerned only with neje:. prob.
2 lams of policy, such as rates, status of personnel, and bud-
& getery matters. Routine control and day-to.-day management ,
3 were effected by the 26 (in 1938) Divisional Vanagements
(Reichsbahndirektionen), who were not limited in authority to
the maintenance of way and structure and the operation qf
? equipment* as in the American scheme of divisional organiza-
tion, On certain matters of policy the Minister had the ado
vice of a special advisory council, formed of representatives
of industry, trade0.and public, Directly under him there
were two technical offices, at Berlin and Munich, in charge
? of mechanical and civil engineering, workshops, research, and
other technicsa matters requiring common administration?
Under the divisions were the local district offices for traf-
? fic, construction, operations, locomotives and rolling Stock,
responsible for their particular function in their districts.
The major workshops were supervised by a board consisting of
ten of the division managers. To coordinate the work of the
26 divisional managements there were three operating offices,
in Berlin (East), Essen (Went), and Yiunich (South). ' They were
responsible for the harmonious coordination of train and traf-
fic working in the divisions under their immediate control?
However, the divisions were on equal footing with the operating
offices, and in all administrative matters were responsible
only to Berlin.
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RESTR I L; tu
PRE-1%1R GERUITY RAIUZY TRANSPORTATION (13-10 2 & 3 CONT'D)
The general regulation of private railroads was also the
task of the divisional president, although tariff problems
were still reserved to the Vinister0 In the case of light
railroads, the regulatory functions were divided? Powers
of administrative regulation were delegated to the state
authoritiess whereas technical regulation was exercised in
Bill areas (except Bavaria) by the presidents of the divi-
sion managements. Both private and light railways were
members of the Reich Railways Transport Group in the Nat..
tional Transport Group of the German corporative eystem?
The Railway Transport Group therefore represented the rail..
roads insofar as they remained in private0 municipal or
state hands, but only in a consultative sense? .
The centralization of power in the ReichsverkehrsMinis0
?terium (Linistry of Transport begun by the decree of
June 21, 1919, and Confirmed by the law of February 170
1934, continued all through the pre-war-period? It is to
be noted that two aspects of transportation were assigned
to other agencies: (a) air transportation was the business
of the General Air Office in the National Air Ministry,
(b) the supervision of road construction and maintenance
had been shifted to the Inspector General for Roads.
The rinistry of Transport was hbaded by a !lir-lister, Dr?
Ing0e.h0 DorpmUller0 The Undersecretary, Dr. Ingo
GanzenmUllers was the overall head of the Railroad Divi-
sions? An Advisory Council (Beirat) consisting mainly of
industry representatives and transportation experts9 car-
ried..out purely consultative functions? The various divi-
sions of the Ministry will be discussed below as they were
related to each form of transport?
The railroad divisions of the Reichsverkehraministerium
did 'not merely "supervise" or "control" the administration
of the Reich railroads; they emnaged them directly? All
organs of the Reichsbahn. were Reich agencies, its em-
ployees were civil servants of the Reich,; The Minister
of Transport was the head of the Reichsbahn, with the
title of Generaldirektor der Deutschen Reichsbahn. As
Assistant in this capacity0 he had on Undersecretary of
the Ministry, whose title was Stellvertretender General-
direktor (Deputy General Manager)0
The Railway Traffic and Rates Division (EisenbahnflVerkehrs-
und Tarifabteilung) prepared and adjusted rate schedules,
organized the regular transportation services for passen-
gers and shippers, and in addition handled large mass
movements of persons and goods and arranged preferential
rate schedules therefor. In this capacity s it managed the
transport aspects of the Nuernberg mass meeting of "Kraft
durch Freude"; and in wartime it adapted railroad trans-
port regulations to military needs,' in cooperation with ,
the. Railroad Finances and Legal Matters Division.
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RESTR I CTED
PRE.ZAR GERMANY - RAILMY TRANSPORTATION (B-10 2 & 3 CONT'D),
The' Operational Management Division (Eisenbahnbetriebs-
abteilung) controlled the operational coordination of'
the whole railroad system? including the technique of
train and locomotive services, marshalling and switching,
end the preparation of timetables.
The Machine-technical Matters and Purchasing Division
(Eisenbahn-Maschinentechnische-und-Einkaufsabteilung)
placed orders for major new acquisitions? and was the top-
administrative agency in control of workshops, stores?
locomotives and electrification works. It handled mech-
anization projects, electrification, and research on the
problem of substituting domestic materials for imported
ones in order to save foreign exchange,
The Railroad Finances and Legal Metter? Division (Eisen-
bahn-Finanl-und Rechtsabteilung) handled the finances of
the Reichsbahn, one of the world's largest single busi-
ness enterprises, separately from the general finances.
of the Reich. The accounts of the Reichsbahn were pre-
pared from the daily reports of the 26 Divisional
Managements, which were treated almost as separate enter-
prises. As prescribed by the Reichsbahngesetz, balance
sheets and profit-and-loss accounts had to be published
yearly. This Division had two sections. The Legal Sec-
tion (Rechtsabetilung) handled the Reichsbahn's day-to-
day legal business, formulated rail legislation and
transport regulations. The Light Railroad Section
(Kleinabteilung) regulated the 136 privately-owned rail-
roads, the 309 narrow-gauge railroads, and the 100 com-
mercially run sidings, all totaling about 13.000 kilometers,
which formed approximately 20% of the Reichnbahn's entire
network. .Routine technical matters for these roads were
controlled by division managements. The private and
light railroads were organized into a corporate system of
transportation, which as a unit exercised strict control
over its members and interfered radically with the manage-
ment of the component enterprises. This corporate system
was under the control of The Division for General Adminis-
tration (
Abteilung Air Verwaltung),
The Division of Personnel Matters (Eisenhahn-Personal7
abteilung) handled the personnel affairs of more than
1,000,000 men and women. One section (under a Ministerial-
direktor) dealt with employees; another (under a Minis-
terialrat) with laborers.
The Division of Construction (Eisenbahn-Bauabteilung) super-
vised the reconstruction and eXparisiop program. In addition,
.numerous Construction Offices (Neubauamter) were created;
these were subordinated to the Divisional Managements.
The Railway Planning Division (Eisenbahn Planungsabteilung)p
' a newcomer among the railroad divisions, seems to have
assumed, before 1943, the functions of the former Railroad
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Ktbintuicu
PPE-WAR GERMANY - ? .RAILWAY TRANSPORTATION (B-1. 2 & 3 COYT'D)
Construction Division (Eisenbahn-Bauabteilung). Although
no complete description of the work of this division is
available, it may be assumed that the jurisdictional dif-
ference between it and the Division of Construction was
that the Planning Division prepared the plans for new con-
struction and reconstruction projects,, the execution of
which was supervised by the Division of Construction.
The Railway Military Matters Group (Eisenbahnwehrmachtliche
Angelegenheiten), set up long before the war as a liaison
between the Ministry of Transport and the 'Aehrmacht, pre-
pared the plans to meet the needs of military transporta-
tion and arranged schedules to go into effect when war
should begin. During the war0 this division cooperated
closely with the military authorities.
The Audit Organization of the Reichsbahn (Hauptprufungsamt)
audited the Reichsbahn accounts. It cleared accounts with
the Rechnungshof des Deutsohes Retches (Court of Accounts
of the Reich). Subordinated to the above were the audit
offices attached to the Central Offices and to each Divi-
sion Management. The chiefs of these were the acoounting
officers of the respective agencies. When they acted in
the capacity of chief of audit offices, they reported to
the Chief Audit Office; otherwise9 they reported to the
President of their agency.
Complementing the Transport Ministry in its performance of
regulatory !Unctions were two organizations0 a resume of
whose workings will be given here.
By the Act of November 27, 19340 Germany's business enter-
prises were organized into self-governing groups, headed
by the Reich Economic Chambers, with compulsory membership.
The 140,000 transportation enterprises were originally a
part of this system, but by a decree of September 23e 1936,
they were separated from the other Reich groups, renamed
"Organization of Transport", and divided into seven func-
tional groups.
The. Transport Groups were placed under the jurisdiction of
the Minister of Transport, whereas the other Reich Groups
remained under the nominal administration of the Ministry
Of Econothics, The Transport Groups, although referred to
as "self-governing bodies"0 acted as government agencies,
with power to intervene in almost every aspect of the
management of the transportation enterprises, including .
questions of expansion0 transfer of officers, and personnel
problems. Through interchange of delegates with the other
organizations, such as the Reich Chamber of Economy. the .
nandtional and regional groupings of industry and trade,
and the German Labor. Front, uniformity of administration
was theoretically ensured.
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fltIItIaICL
PRE?WAF GERMANY - RAILWAY TRANSPORTATION (B-1. 2 & 3 CORM)
Those transportation facilities which were not in the hands
of the Reich were thus united into the Reich Transportation
Industry (Reichsvorkehrsgewerbe) with these seven groups:
1. Ocean Transport
2. Motor Transportation
3. Private Railwaya
4. Inland Shipping
60 Forwarding and Stet-age
6. Auxiliaries Of Transport
7. Hauling and Carting
These groups were divided into Trade Groups (Fachgruppen)9
which in their turn were divided into Sub-Trade Groups
(Fachuntergruppen).
? The fUnction of the National Transportation Advisory Council
was to produce a close liaison between different branches
of the industry and in turn with the users of transporta-
tion. The results of their deliberations were presented to
tile:Transport Minister to use or reject as he saw fit, The
Council meetings wore hold irregularly at, the convenience
of the Minister, who also fixed the agenda for the meeting.
The broad purpose was an exchange.of ideas on'the national
scale between shipper and carrier. The composition of the
council indicates.the character of its representation: The
loaders of the 7 transport groups, 6 delegates from indus-
try, .2 from the Nntional Food Chamber, and 1 each from the
Air lanistry. the Post Office, and the Inspector General
.of Roads, the Cities, the German Labor Service, and the
Nntional Cultural Chamber. The Advisory Council wag dupli-
cated all down the echelons of command so that every sub- .
group had an advisory council formed on the same representa-
tive principle.
4. AG has been said, prior to the Weimar Republic0 transpor-
tation mattera were not centralized in the Reich. The.
Weimar Constitution9 however, transferred the state
-railroads to the Reich for uniform management.- By the
decree of June 21. 1919, the Reich Ministry of Transport
was established. In 1934, the Reich Ministry of Transport
And the Prussian Ministry of Transport were unified under
the name of the Peichs-und Preussiaches Verkehrsministerium.
After the annoxntion of Austria, the name again became
Reichaverkehrsministerium.
When the Ministry of .Transport was created9 the aim was to
concentrate all supervision and control in one Reich agency. '
The states showed considerable resistance, which was gradually- .
overcome to some extent. Under the Nazi regime, the internal
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RESTR I CTED
PRE-A?. Gtanry 111.ILITAY TRA:PORTATION (6-4 CCCT'D)
organization and personnel of the Yinistry of Transport were
at first left relatively unchanged. The concentration of
power in the Iiinistry of transport continued, although im-
portant sectors were again taken out of its jurisdiction'
(a) the lanistry of Air Transport took over aerial transpor-
tation; (b) the construction of waterways was transferred to
the Inspector General for Tater and PoWer; (c) the supervi.
Gioia of road construction and maintenance was transferred to
the Inspector General for Roadsi and (d) maritime shipping
was placed under the Reich Commissioner for Ocean Shipping
in 1941..:
6. In the absence of a free press or of parliamentary debate
on the Anglo-Ameridan model,, there could be.no free expres-
sion of opinion in Germany on the operiating efficiency of a
government department or a state monopoly. Taking perfor-
mance as the yardstick of meaouremento we have the statement
of the United States Strategic Bombing Survey:
"In brief, the .Reichebahn was the sort of plant
any railway man would like to have constructed had
ha been free from financial obligations...Esprit de
corps song German railroaders appears to have been
very good. Voreoveyithe standard of technical
training and,Ecneral competence was exceptionally
good."
"Prior to the war, Germany possessed one of the
most complex, adequate and well.maintained railroad
systems in the werld...A strong inland waterway
system connecting the important rivers of North
Germany, crisscrossing the Ruhr coal area; and pro-
viding through water transportation from the Ruhr
into the Berlin area, accounted for 21 to 36 per-
cent of the total freight traffic movement. It
was well adapted to the movement of heavy cargoes
in and out of the Ruhr distriet. Commercial high-
way transportation of freight was of little signific-
ance, accounting for less than three percent of the
total, ,and coastwise shipping was of minor importance
compared with the.total inland. movement. Contrary ?
to general belief at the outbreak of the war, none
of these transportation systems, wad undermaintained.
Standards were well above those common in the United
States, an element of strength which would permit
curtailhent in maintenance for a period of years
before operating efficiency or safety would be
affected."
C. AMINISTRATION
1. This question is not strictly applicable, since the govern-
mental policy was one of restricting rather than expanding
transport facilities and enterprises. For specific infor-
mation see the relevant sections of this report.
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i,tsTR I CTED
ppG0':7tR GlaikNY - RAILICAV TRANSPORTATION (C-2)
2, The German rate structure was known RS Gemeinairtschaf-
flitches Tarifsystem (rate structure *based on the interests
of the economic life of the country as a whole). The sub-
ordination of the freight rata structure to considerations
of economy, defense and politics may be illustrated by noting
some of.the special adjustments, The railroad rates effective
in 1937 reflected the four-year plan. Thus special rates
were established for raw materials used in the manufacture of
artificial wool and cotton yarns, Special rates were also
allowed for German raw materials where such rates ddmulated
their use and saved foreign exchange.; examples were ores,
slags, and synthetic Diesel fuel. Low rates on potash and
calcium were designed to help agriculture. On the other hand,
by way of aiding exports, iron and steel goods, paper, glass
supplies, and chemicals could be hauled to seaports et
special rates, Material for the Autobahnen'was carried at
cost, this accomodation (rendered for an ostensible subsi-
diary which was in reality a rival) amounting to a probable
total sacrifice of 100 million RW at the end of 19370 In
addition, some arrangements were even more directly politi-
cal. Building materials for the party grounds at Nurenberg
were forwarded at a reduced rate of 30 percent? In addition,
goods destined for winter help were shipped free of charge,
entailing a freight revenue loss to the Reichsbahn of 18
million RM.
The Reichsbahn had separate rating systems in operation for
wagon-lord traffic and traffic in part wagon-loads, and
further, according to whether the traffic was conveNed in
ordinary freight trains. The ordinary rate classification
applied only to wagon-load traffic; there was no classifi0
cation for part wagon-load traffic, which was charged ac-
cording to freight tables based on weight and distance,
Wagon-load rates applied to wagon loads of 15 tons and up-
wards, and were increased by fixed percentages, varying with
the class of goods for wagon-loads of ten tons and five. tons
roopoctively, All haulage rates tapered downwards with in-.
crease in distance.
The exceptional tariffs were not always special rates ss
usually understcod, that is, rates applying to certain goods
and to certain areas. There was a considerable number of ex-
ceptional tariffs in favor of certain commodities from all
stations to all stations in Germany. Some of these so-called
special. rates had a general application and thus functioned
merely as a new classification added to the general tariff,
Thus, there was a raw materials tariff for bulk commodities
such as fertilizers, potatoes, minerals, etc. These general
'exceptional rates had no quantity restrictions and were avail--
able to and from all stations in Germany?
In addition, there were many Genuine exceptional tariffs,
These rates were subjected to a number of restrictions over
and above those which would apply to the same commodity
when dispatched at the normal rate, The employment by. a
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? atel"--
PRE-MR GEWANY RAIMY TRANSPORTATION (C-2 COrT'D)
trader of a given special exceptional tariff was usually deo
pendent upon the observation by him of certain attendant
clauses. An example was the *producer' clause; when this was
imposed the goods for dispatch must have come from a particu-
lar country, district or town. This clause was generally im-
posed as a discriminatien between home products and imported
goods, but was also employed to aid the development of an
industry in an area unfavorably situated geographically. 'Men
the clause *prohibiting re-export* was applied, goods were
given a reduced rate to a particular foreign country on the
understanding that once the goods had reached their destina0
tion, they would not be re-consigned elsewhere.
Exceptional tariffs were introduced on the German railways
as part of p policy which aimed at adjusting the cost of
transport so as to benefit the country as a whole by. assisting
industry and trade against toreign competition, and by de.
veloping exports. The exceptional tariffs may be divided
into two main categories: (a) Exceptional assistance tariffs;
these were introduced in order to favor economic activities
within Germany. They facilitated the transport of vital
goods, the movements of exports from their place of origin to
the seaport? and protection of home markets. They overcame
temporary disadvantages by emergency measures? e.g. they per-
mitted the granting of rebates to retain the custom of tra-
ders near e frontier who could obtain cheaper rates by using
a foreign railway, (b) Lxceptional competitive tariffs:
these tariffs were designed to prevent any undue trespassing
within Germany of foreign transport systems which could offer
lower rates for exports end imports - seaports? railways,
waterways? air or road transport. A prominent example of
such tariffs WAS the Seehafenausnahmetarife, which exerted
R powerful influence in diverting to Bremen and damburg from
Antwerp And Rotterdam the traffic of Wettern Germany, and
which to some extent diverted from Antwerp, Rotterdain,
Marseilles, Clenoa and Trieste the traffic of South Germany
and Switzerland.
30 Since the firing of tariff ratee is the single most important
instrument of regulating transport competition, this question
is implicitly answered in the answer:: to question C-20
4'. There were no peculiarities in the German administrative
system of safety regulation and inspection which?require en-
umeration here. The only difference.from commonly accepted
practices lay in the high degree of centr.lization within.
the
the lanistry of Transport.
5. The employees of the Reichsbahn, by far the largest single
element in transportation, were civil servants, and therefore
subjected to the training and educational requirements of
civil service. They were similarlx divided Into three main
'classes: higher civil servants (hohere Beemte), civil ser-
vants of intermediate rank (nittler? Bearte), and those of
lower rank (untere Beamte). Prior to the war higher officials
numbered about 1.250 civil servants of intermediate rank 30%,
and those of lower rank 66.e of railroad personnel.
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PPY0WA7 RAILWAY TRANSPOTIATION (005 CONT0D)
The higher carreer was in general open only to well recommended,
applicants with full university education and good scholastic
records. Applicants with legal baokground were required to
have passed the state-bar examination which required, in ado
dition'to graduation from a university, 3 to 4 years of train-
ing in courts and law offices. Applicants with engineering
background were required to have graduated from an institute
of technology in mechanoial or civil engineering, and, after 3
years training in technical railroad service or in other techni-
cal enterprises, to have passed n special engineering examination
for higher reilroad serviceo then admitted to railroad service,
both classes were trained for a period of 1 14/2 to 2 years in all
fields of practical routine (in division managements, superintend-
ents2 offices, and subordinate agencies). They then started RS
junior section members of a division management o Promotions were
baaed on ability. Under precwar conditions about 45% of higher
officials were civil engineers, 255. mechanical engineers, and
207 had legal training. Only about 102i:were promoted from the
intermediate ranks:
Tho intermediate career was open to boys who had completed 4
years of grammar school and 6 years of high school. Yany
applicants, however, had a better education? and for admission
to technical services graduates from technical high schools were
preferred, Positions as chiefs end assistants in the agencies
subordinate to the division managements and all important clerical
jobs in agencies of all grades were filled with civil servants of
intermediate rank.
Civil servants of lower rank were usually' recruited from workmen
employed in railroad service or from former non-commissioned army
officers who after a certain period of service -- had obtained
a certificate for preferential admission to civil service
(7ivilversorgungsschein). Such positions as stationmaster at
small stations, clerical helper? locomotive engineer, firemen,
conductor, and foreman in maintenance of way and structure and
eouipment service, were occupied by servants of lower rank.
The status of workmen was similar to that which prevailed in
German industry in general, The largest groups of workmen were
helpers in services usually performed by civil servants
(Hilfskrafte in Beamtendienst), workers in train and switching
service (Betriebsarbeiter)? track laborers (Bahnarbeiter), and
shop laborers (Werkstatteorbeiter). A small number of employees?
such as typists and clerks (mostly women), had the status of
clerical workers (Angestellte). Their status was determined by
the 'general provisions which German legislation had established
for cLrical workers.
60 As of September l 11938? Germany had ratified these international
transport conventions of the League of Nations: the transit
conventions, ports convention, railways convention, the declaree
tion recognizing the flag of Inland States, the hydro-electric
power convention, the Toad and motor traffic conventions. Germany
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PRI7,0WAR ? RAILWAY TRANSPORTATION (C-6 =Ton)
belonged to the following international organizations cone
earned with transportationa
The Baltic and International Association of Navigation
Congresses
International Shipping Conference
International Shipping Federation ?
Union for the Use of Carriages and#Vans in International
Traffic
International Railway Congress Association
Central Office for International Railway Transport
International Railway Union
International Railway Wagon Union
International Conference for Promoting Technical Uniformity
on Railways
European Conference on Time?Tableso
00
In. addition? Germany was 'a member of the Voroin Mitteleuropaischer
Eisenbahnverwaltungen (Association of Central European Railway
Administrations)0 The last organizationD since voting reiresen??
' tion was-based on mileage and its decision(' were binding on all
membershipso was of fundamental importance?
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CANA4 - RAILWAY TRANSPORTATION
A. 'POLICIES
1. The Canadian railway system, throughout the years, has repre-
sented a planned developmentipointed toward national political.
objectives, It has provided the transportation basis for a
'very substantial movement of traffic across Canada, and has
thus largely contributed to the establishment of a purely
Canadian economy, independent of the US railway. network.
Railway policy has been determined by the State,'Which.has.
inflemented its will through the no*er to regulate rates.:
The Canadian railway system occuPies first place among the
various media of transportation, both economically and stra-
tegically. In a political sense it binds province to province
and the Maritimes on the Atlantic to British Columbia on the
Pacific. ,At the same time, the two transcontinental systems
operate numerous lires cannecting up with others south of
the border.
The emergence of two powerful railway. systems, the Canadian
Pacific Railway, owned and operated by private interests,
and the Canadian National Railways, owned and operated by the .
Dominion, appears to be emirently satisfactory to Canadians
and to the government.
2, Over-all transportation policy is certainly administered at
Cabinet level. The Dominion Department of Transport was or-
ganized in November, 1936, to unify in one department the
control and supervision of railways, canals; harbors, marine
end shipping, civil aviation and radio. ,
4n The government and the provinces liberally extended subsidies
to railways daring the days of pioneering and assumed as a
result a large volume of debt, The government, therefore,
was in the railway business almost from the beginning. To
protect its interests it was compelled to take over the Ca-
nadian Northern, the Grand Trunk, the Grand Trunk Pacific and
other lines which were consolidated in 1922 into the Canadian
National Railways, Except for a rew years during World War
II Canadian National Railways have operated at a loss and
hate been subsidized to that extent by the Dohinion Govern-
ment. A staggering burden of public. debt has been acquired
by the Dominion Government as the result of its involvement
in traniportation. At the end of 1937, 70 percent of the
combined ton-self-supporting debt of the Dominion, provinces
and municipalities, was directly attributable to tranaporta-
tion. An attempt was made in that year to determine what
part f' the cost of public transportation was borne directly
by the users of the facilities and what part was borne in-
directly by the general public through taxation. The total
cost of public transportation was found to be appreximaiely.
31,3670000,000, of which about 88.5 percent was directly
borne by the veers and 11.5 percent by taxes of general ap-
plication. The progressive accumulation of obligations on
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CANADA para. TRANSPORTATION 14-1. CONTID1
behalf of water and rail transportation facilities *owned by
the Dominion in 1936 had reached 33,386,000,000, a per
capita basis of $307, as against $22 in the year 1882.
The Canadian Government still assumes the annual deficit
which is incurred by its wholly-owned system, the Canadian
National Railways. This system has operated at a profit
only during the war years. In view of possible reductions
in Volume of freight, and increased operating codts? it is
likely that the Canadian Government will be forced to cot-
tinue its substantial subsidization of this system... At the
present time yailroads have before the Board or Transport
Commissioners a request for an over-all 30 percent increase
in rates. Hearings have been conducted throughout the coun-
try on the request and despite violent opposition from some
quarters, largely agricultural elements, it is probable that
the request will be granted.
5. Early railway and canal policy was greatly influrced by the
capitalists who prospected that development. In later years
the public interest has dominated that of the vested interests. - t
. In the early nineteenth century Canada experienced a period
, of enthusiastic railway building similar to that in the US,
.and by the time oT Confederation in 1867 plans were afoot
for the establishment of the first transcontinental railway.
. (The waters of the St. Lawrence and the Great Lakes had given
? the early explorers and fur traders ready, if not convenient,
' access to the interior of the ctintinent and the valley of the
Vississippi. Access to Canada's prairies was also developed
by way of the Hudson Bay, where Fort Churchill was early
established.)
While the large volume of trading which has always. existed .
between Canada end the United States, has favored the ori-
entation of.Canada's railroad development into north and south
routes.. Provincial and Dolieion political considerations have
been strong enough to counteract this eConomic reiluirement.
Canada-?s railway development, consequently, has progressed
? from east to'west and hasTinally resulted in two strong
competing systems, both Operating transcontinental routes--
one the Canadian Pacific Railway, a private enterprise, the
other the' Canadian National Railways, government-owned.
Destrective competition between these two gigantic systems
has been very largely avoided. ? -
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CANADA' - RAILWAY TRANSPORTATION (B-1)
D. GRGANIZATIO::
1. The over-all policies are applied in the case of inlarvi
'& waterways; highways and railways through the Board of
2, Transport Commissioners; and in the case of ocean-going
traffic through the --laritine Commission. These two
organizations are autonomous bodies, with both adminis- .
trative and judicial functions. It is doubtful that the
Lardstereof Transport, vho heads the Department of Trans-
port, could directly influence them unless they wen in t
fUll agreement' with his policies and objectives.. For '
example, in the case of the Board of Transport Commissioners,
the only adminiktrative tie-up with the Department of Trans-
port is that the latter receives from the former its annual
estimates and submits them to Parliament with its oat annual
request for oPerating funds.
3. The various agencies regulating transport operate very close
to the Cabinet and look to that source for major policy. '
The Dinister of Transport has lost much of his responsibility
to the Board of Transport Commissioners, the Air Transport
Board and the Maritime Commission, all three of-which are
largely autonomous. However, as indicated, the Ministry of
Transport furnishes extensive services to all three fields
of transportation.
it. The.Beard of Railway Commissioners was established in 1903
and succeeded what was then known as the Railway Committee.
/t consisted of throe members, later increased to six,
appointed by the Governor in Council. It is autonomous, has
batt administrative and judicial functions, and is a court
of record. It has gradually assumed most of the administra-
tive and judicial functions fornerly falling under the
Dinister of Transport'and has practically complete authority
on railway matters. Its orders are, however, subject to
appeal to the Privy Council and in some circumstances to the
Supreme Court of Canada: In 1938 the title was chmmgedirom
Board of Railvmy Commissioners to the present title, "Board
of Transport Commissioners'', at vhich time its power was
extended in certain respects to the fields 'of tater and air
transport.
5. In the main, the Canadian agencies handling transportation
policy are regarded as operating efficiently in the
interest. The Board of Transport Commissioners and its
'predecessors have played a vital role in the development of
the railway systems in the national interest,
C. ADMEaST1ATT0IA
1. The Board of Transport Commissioners exercises authority, as
to location, construction and operation of railways.
2. Passenger rates are divided into standard and special. Freight
rates into standard, special and competitive. Standard rates
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CAUADA BA/LAY TPaUSTORT.TIOil (C-2 CMTID)
are mixiMum rates and the only ones that must be approved bY
the, Board before they are applied. Special and competitive
rates, being less than maximum rates, may be applied by
railmays without the Boardls approval, provided that a change
of rates has been advertised. This permits the railways to
compote, insofar as rates are concerned, with motor carriers.
3. Although all lines of transport are subject tp scam govern-
ment. regulation, there is a wide area permitting free com-
petition. With the uniform establishment of rates by the
Board of Transport Commissioners, competition resole/es it-
self largely into a question of efficient operation. The
Canadian Pacific Railway manages to show a profit whereas
the government-orned and operated Canadian National, except
for the war years, has operated in the red. This is not .
entirely due to the lessor efficiency or operation resulting
from government ownership and control. Both roads own and
operate extensive indhstrial'and mining interests. They are
both heavily involved in the operation of hotels, steamship
companies and airlines. -.
? ?
4. Safety regulations and operational proceftres have been
standardized on both sides of tie border and are satisfactory.
The Board of Transport Commissioners establidhes rules and
regulations and enforces thentwith respect tO railway opera. -
tions.. It investigates accidents in a judicial capacity'.
3. The Government does very little to foster or regulate train-
ing of technicians in any of the fields of transport.
6. There appear to be no high- gr
level international agreements in
. '
the railway field toachich Canada is at present a party.
Canadian railways and American railways Work out anderstandiags
on the Operational level as to the division of payments for
? freight and passenger trenepsitation arioing in their respectitia
countries. The railways maintain a division sheet indicating
the amount of charges received for service aceruing to the
Canadian and American Carrier. Waybille Are settled with each
carrier's audit office. These payments are net of interest
to either government. It is required, of course, that freight
tariffs pertaining to Canadian companies be posted with the
Beard of Transport Commissioners and that the tariffs pertain.
inc to American companies be posted with the United States
Interstate Commerce,Conwdssion. Through freight rates, however,
are essentiAlly worked out by the carriers themselvea and
neither goverthent injects itself into the matter unless It
is considered that the rates are exorbitant.
It is possible to :ship merchandise on a through bill of indin8,
for example, from New.Ierk to 'ainnipeg. !lost of the travel in
international freight movements occurs within Canada the rela-
tive mileage being apprcecimately 60 per cent in Canada and
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CANADA_. RAIL:Alr TRANSPORTATION tC-6 COLUID1
40 per cent in the United States. The dicitz;1.1mtion of
railuay revenue on international traffic is a matter
adjusted in each case betueen the connecting lines.
The United States Office' of Defense Transportation has
establishea an upper limit of 8,000 US cars as a maximum
to be in Canada at any one tine. There have been several
misunderstandings about this arrangemen.4 the most recent
one having led to considerable ill-feeling at thetine.
blaring the mar there mus very effective pooling of traffic
und equipment, both as to railway animater transport. At
the present time, hoeever, no such arrangements exist.
The American Ansociation of Railroads has worked out an
understanding with the Canadian roads on the return at.
American freiLtt cars, which again is an agreement on the
operational level.
7 The reports which are required to be submitted to the
various supervisory agencies of the govanina.nt arc too
amorous and variable to petmit listing. Such a list,
if it 'mere possible to compile, would chance substantintiy
from day to day. The nature of the replies to the questions
.previously covered in believed to indicate in a broad sense
the nature and extent of the reports desired. The Dominion
'Bureau of 3tatistic3, for purely statistical purposa,
requires numerous reports as to traffic, materinls used,
employment given, etc. Rates in all cases must be filed nith
the appropriate supervisory bard or agency.' Practically all
detnils as to the operation of common carriers are supdlied
in printed form to the public by the Dominion Bureau of
Statistics. Further information is made available .throwt
the annual reports or 'he Departt.ent of Trade and Conerce,
the Boarcrof Transport Comissioners ? the Department of
Transport, and others. Jimilarly information is published
annually in the Canada Year Book and in special reports
poriedicallymade by the vair6E agencies. These reports
make it evident that transport companies file an infinite'
variety of reports and farms durinc the course of operations.
HeArts on inspections of accidents are periodically published
by the agencies concerned, in tSe case of the railroads by the
Board of Transport Conissioners, in the case of tSe air lines
by the Air Transport Board, and in thn case of raterborre
traffie by the Uc;.artnnt of Transport.
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.BRAZIL e RAILWAY TRANSPORTATION
A. TOLICIES
\
.1. Railway transportation policy is determined brthe,state.
Basic transportation policy in Brazil has favored railway
development more than that of other forme of inland trans-
portation, jand the isolated population areas along the coaet
have been able to organize individual rail networks serving
their respective hinterlands. Government policy, however,
has not been sufficiently farsighted to insist on development
according to a national plan, and many largely unconnected
systems with different gauges have resulted. Recognizing the
importance of adequate railroads, the Government_is now be-
latedly attempting to effect a certain degree of standardi-
zation in gauge, and to achieve by expansion a more integrated
nation-wide system with connections into Uruguay, Paraguay and
Bolivia. A continuation of the trend toward nationalization
rill probably further redUce the number of privately-owned
rail systems.
2.; Polley governing all forms of transport, except air, is,con-
? trolled by the Brazilian Ministry of Transport and Public
rorks. There exists, however, little integration within the
? Unistry of its components which regulate the individual
transportation media, and the Ministerial Departments are
largely autonomous. There has been, moreover, a-certain de-
gree of decentralization in the administration of Brazilian
railways. rhereas the Federal Government owns 21,368 kms of
railway lines, it actually qperates only 13,068 kms. The ,
delegation by the Federal Government of operating responsi-
bility to the individual states is indicated by the fact that
while the states only own 3,274 kms, they,operate 10,550 kms
(private interests awn and operate about 10,000 kms of rail
lines).
3. While the development of the Bratilian railway aystem has been
dominated by economic considerations, there are certain as-
pects of strategic significance. One objedtive of Brazilian
policy is to establish a lateral railway line behind the en-
tire Brazilian coast from the mouth of the Amazon to the Ar-
? .gentine frontier. If this line materializes, the movement of
? material and troops could be organized sufficiently distant
from the coast to be independent of local military developments
in the coastal port areas. Another objective of Brazilian
policy is to connect its railway system through Bolivia with
what may eventually become a transcontinental rail artery.
In achieving this, Brazil Would counterbalance the advantage
now enjoyed by Argentina, its most powerful potential enemy in
? South America, which already is-coanected by railway with the
Chilean Pacific port of Valparaiso. Possible future rail de-
velopments into Boli ?la, Paraguay and.Uruguaywould also be of
advantage to Brazil in case of localized military operations
in these areas.
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SP0
- A el, ?
4)
4. Brazilian railraods are not subsidized, although operating ?
deficits are covered for the lines under government ownership.
Indirect support is given the railroads in the form of import
tax exvmptions for fuels and equipment. According to press
reports', the Brazilian Ministry of Transport and Public Works
has asked the US eXport-import bank to finance a projected
? five-year plan for transport development in Brazil involving
the expenditure of S2000000,000. Included in the plaq'is a
program for railway improvement. For this purpose the Bra-
zilians are said to desire to purchase 1,100 locomotives,
? 7,000 freight cars, 42,000 tons of rails and 2,500 tons of
railroad bridge material.
5. Nested interests exerted great influence throughout the de-
velopment of the Brazilian railway systems. A substantial
part of the Brazilian railways was constructed under private
initiative in which the profit incentive was dominant. The
preeent disjointed character of thaBrazilian network, with
its lack of uniformity in gauge, is strong testimony ofthe
pressure which was exerted by private interests desiring only
a rail development satisfying their particular individual
requirements. '
Brazilian geography has also played a large role in estab-
lishing'the pattern of railway development. The country has
a narrow coastal plain backed by a low sierra and upland
plateau with the population of over 40 million largely con;
Icentrated in areas along the Atlantio coastal strip south of
the Amazon. These population concentrations have developed
relatively independently of eachother. The resulting rail-
way construction accordingly, has served primarily to connect,
each coastal city with those points in its back area which it
has desired to develop. There have resulted more than 50
lines, which include Over 30,000 kms of one-meter track (about
39 inches), 2,000 kms of various broad gauges, and approxi-
mately 1,500 lens, of various gauges 1 feet and under.
Domestic political considerations-have affected Brazilian
railway development because the government has been subjeeted
to pressure from local,politidal factions interested in spe-
cific railway projects. ,
B. oROANIZATIOR ?
1. The Ministry of Transport and Public Therks controls, through
.its departments, all forma of transport except air., The.
Federal Department of Railroads administers the Ministry's
responsibility for railroads.
A separate Government agency, the Tariff and Transport Councg,
has jurisdiction in matters of rates.
2. Despite general administration Of railroads by the Federal .
Department of Railroads, other Ministries have specific re-
sponsibility as follows: Labor is responsible for working
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gygn. ratar _RikESPaS015.1
conditions; Finande for revenues and disbursements; and 7ar
for engineering. While railroad building policy comes under -
the control of the Ministry of Transport and Public 77orks,
actual construction is carried out by the Par Department.
3. During the war there vas effective coordination within the
Ministry of Transport and Public 7orke of transportation
policy. This coordination, however, is now rapidly disappear-
ing. There'is no specific ielattonship between the' Miniatry
of Tr:Insport and Public 7orks and the Air Ministry by which.
rail 'policy and that of civil aviation are coordinated.
t
4. NO reorganization of transportation agencies appears now to
be under consideration. Puperimposed on the normal trans-
portation agencies was a war-time arrangement by which the
Council of National Defense was assisted in transportation
matters by a temporary section called the Transport Department
of National Defense,
5. The Federal Department of Railroads and the Ministry of Trans-
port and Public 7orke aro attempting to direct Brazilian rail.-
? way policy in the national interest, but they are handicapped
by. political, military and financial considerations. Opera-
? ting standards do not compare with those in the US.
C. ADMINISTRATION
1. New railroad lines mat be approved by the Federal Department
of Railroads.
2. Railroad rates are determined for individual lines by the
Tariff and Transport Council. Different rates for the same
merchandise frequently apply to the various railroad systems.
3. The Brazilian Government does not specifically regulate com-
petition between railroads and other means oftransportation.
? The government recognizes, however, the problems raised by,.
competitiou between different forms of transportation. In a
1946 publication of the Brazilian Ministry of Foreign Affairs,
rail and highway competition was described as haying been
acute since 1927. The Ministry described the results as "un-
fortunate". The government has encouraged the railroads to
apply for revised freight and passenger rates in order to
place the competition between railroads and, highways on "fairer
grounds".
The government has described the results of this effort as a
"rational and spontaneous coordination of transportation . .
hitherto unobtained by any other country". This assertion,
however, appears to misrepresent the actual situation vith
regard to coordination or transportation policy. (See A.-2)
4. Safety regulations for railroads are enforced by Federal in-
? spectors.
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BRAZIL- R.A.M4Y TRA1ZEPOR'a
5. The railroad systems have individual training programs, and
the Federal Department Of Railroads subsidizes an apprentice
training school. Engineers are licensed by private profesr
,sional organizations. Engineer licenses for foreigners must
be re-validated every three years. -
6. The lack of railway connections with foreign countries has
made it unnecessary for Brazil to.negotiate international
agreements covering railway operations.
7. Comprehensive annual reports must be submitted to the Federal
Department of Railroads. These reports cover traffit, rates,
accidents, and the financial aspects of railway operations.' '
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t,
Present Argentine policy on nallway trensportation?reflecte
? the tomato and political philarsop32 of the nationallet
gennirnecent. The goverment'has specifically stressed the
public service aspect of rail transportation as contracted
? with the profit-making incentiVe. A high government official
? recently described the transportation syctem, with particular
reference to railways, as the key to Argentine production.
LOELDIT to neighboring countries for the construction of ma- ?
road linos, and cooperation with Brazil in the construction of
S international bridge 'demonstrate that it is a. feature of
Argentine yralicy to improve rail connections with its neighbors.
The current Five-Year Plan provides for the intensification of
government contralti over the nation's economy, including a com-
plete reorganization of the transportation watt* and an inten-
sive technical educational program.
'Raajc railroad policy in Argentina is strongly influenced bp ?
the trend torard state ownership of the various fox-as of trans-
portation. In its initial &ingest, this trend concentrated on
lines in the less develeped trees of the country. It later int
eluded the Argentine State Railways: Eyston (Administracien,de
? Ferrocarriles &el Estado), and by 1946, bad encompassed nearly
one-third of the total rail nileage.
After protracted negotiations with the Government of Argentina,
British interests controlling nearly tma-thirds of all mileage
recently agreed to sell their holdings to the Argentine govern-
ment. Other lines owned by French capital, constituting nearly
? 10 per cent of the total, have likewise been acquired by the
Argentine Government, It appears that formal ratification of
these transactions by the stockholders will be forthconing.
2. Under a Government decree of 15 July 1947, a new Secretariat
wan created responsible ta the President, known ac the Rational
Economic Council (NFL). Its function is to coordinate the en-
? tire Argentine ?economy. Integration of transportation is ac-
cordingly a part.of HECos responsibility. .
3. Both economic and military Considerations have influenced Argen-
tite rail policy. Railroads have opened up the interior for
shipment of agricultural and pastoral Products. Foreign capital
was primarily attracted by the economic opportunities of nil
development. On the other hand, strategic considerations have
prompted the construction of acme lines having no economic jus-
? tification. The present nationalistic governMent appears to be
particularly'anare of the strategic aspects' of proposed railway
construction. For example, strategic and military considera-
tions were undoubtedly responsible for the drive to complete the
? 180 km. Pedro Vargas - Uarlargue line- to the Andean slopes to
transport livestock, oils, precious Metals, Mendoza coal, copper,
lead and vanadium. That the line runs through a military outpost
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ARGENTINA - RAIL7AY TRANSPORTATION (A-3 CORM)
and near the Mull hpiroelectric damstte bay have strategic
importance. ID the race against Brazil to the southeastern
Bolivian oil fields, Argentina installed rail connections from
Yacuiba through Villa Mentes to Santa Cruz.
4. To attract foreign capital, largely British and French, former
Argentine Governments guaranteed a return of 7 per cent on rail-
way investments. It was also necessary to offer inducements in
the form of land grants and cash subOidies. As a rosult, in the
eighty years from 1857 to 1937 about it1,5000000,000 of British
capital was invested, with additional large sums from a few
French operators.
Under the provisions of the Mitre Law passed in 1907, .railways
have been exempt from customs duties on materials imported for
use of the lines as well.as from national and provincial taxa-
tion. In return for such exemptions, the linos have been obli-
gated to pay the government '3 per cent of net receipts, such
paYmente being applied to improvements of highways and bridges.
A further major form of indirect subsiay was the guarantee that
additional concessions would not be granted to other interests
within Certain areas during the life of an agreement.
The provinces on authority from the national governient, have
been empowered to grant concessions to railway interests, in
order to further the development of the areas under their jurit-
diction.
It is probable that the character of subsidies will change after
the completion of the nationalization program. Deficit appro-
priationt? as required, are expected to be adopted.
The current Five-Year Plan includes an appropriation for
800,0000000 pesos covering the purchase of equipment and rolling
stock, and the improvement of rail connections with Chile,
Brazil and Bolivia. The plan, however, does not provide for
extensive construction of new lines.
5. Railway policy in Argentina has 'been strongly influenced by:
(1) vested interests, largely British and French capital; (2)
economic requirements, such as the progmm to develop the in- .
terior; and (3) geographic factors (Argentina, unlike Brazil or
the US, has no extensive river system, and has had to develop
rail and highway facilities to serve adequately the great pampas
regions)".
The nationalist Complexion of the present government rill un-
dbubtedly result in careful examination of all future plans for
railway construction ,to ensure the protection of strategic and
political national interests.
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ARGENTINA - .RAIINAY TRZSPORT/ITION (3-11
B. ORGANIZATION
1. Ministry of Public 7orks:'
Director General of Railroads
2. The Ministry of PublicTiorks is responsible for railway trans-
." portation policy. The Director General of Railroads implements
laws pertaining to railroidi. He inspects railroads and super-. .
vises railway operation and construction. He initiates projects
for extension of existing lines and the construction of new
lines. He approves operating schedules, and collects, compiles
and publishes statistics.- The Office of the Director General
is subdivided into sections responsible for:
Administration
Construction
Tariffs and Statistics
The Director General has a staff of railway inspectors.
3. Rail policy is integrated with policy on all forms of trans-
portation at the level of the National Economic Council.
4. It is reported that a new transportation law is under considera-
tion which may carry far-reaching changes in the organization of
transportation responsibility.
5. Argentine railroads have been generally' credited with a higher
level of operating efficiency than any other South American
system. This has been primarily.due to the predominant British
control. The US-trained Director General of Railroads is con-
sidered capable, however, and the impending elimination of
*British control may not be greatly detrimental to efficiency.
On the other hand, governmental reorganization measures will
introduce new control personnel, and may adversely affect opera-
tional standards.
C. ADMINISTRLTION
1. New railroad lines are proposed by the Director General of
Railroads, who submits his documentated recommendations to the
Congress. Any subsequent construction is under his supervision.
2. The Director General determines rates. Changes in current
rates are expected, in vier of the recent purchase of all lines
by the state. The 1944 railroad rates are currently applicable.
3. Vith the assumption of state control of all railroad operations,
Ocompetition will now be confined to quality of service rendered.
Uniform rates will be applicable to all the lines, including
those still temporarily under British operation.
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ARGENTINA - RAIMAY TRANSPORTATION (G-4)
?
I.
4. InSpection and safety of equipment is a responsibility of the
Director General of Railroads. Pertinent regulations were
first approved in 1894 and modified as occasion demanded. The
enforcement of these safety and inspection regulations is
carried out by the staff of inspectors responsible to the Di-
rector General of Railroads. Regulations governing the safety
of the operating personnel are determined by the Secretary of ?
Labor and Social 7elfare and enforced by that office.
,
i5; The training of operating engineers iS under the Director
General of Railroaas? whose office issues 'licenses required
for operating locomotives. The training of other operating
and shop personnel has been left to the individual lines.
However, the Five-Year Plan provides an intensive technical
education program for all media of transport.
6. International rail traffic is coveied by agreements with
neighboring countries which permit through passenger and
freight traffic and the interchange of rolling stock (except
locomotives). The couptry of destination picks up passenger
and freight cars with its awn motive power at frontier sta-
tions. There appear to be no international agreementS on
traffic or equipment pools, joint facilities, rates or routes.
7. The Director General of Railroads requires daily and compre-
hensive monthly reports covering traffic, operating costs and
revenues, rates and other operating data. Reports concerning
accidents and conditions of employment are .routed to the Secrec4
tary for Labor and Social 7elfare. Such reports have a bearing
on government consideration of wages, personnel insurance and
social security matters.
\
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AL4 D arc. La,
PERU - RAILROALZ
A. 91LIGIES
1. Basic rail policy is determined by the government. It involves
promotion and construction of now railroads to unite the widely
separated regions of the country. Peru is a country of great
geoaraphical contrasts. There are three Peres ?the dry, narrow
coastal plain with modern citier and ports; the Andean Sierras
with mineral resources; and the immense montano sloping eastward
to the Amazon plain. It is fund4cantal to the national economy
that these regions be connected by efficient transportation.
The populous and politically influential Southern Peru area is
isolated from the capital. It is politically expedient for the
party in power to provide this region with efficient cross country
railroads connecting the Pacific coast port of rollendo (ratarani)
with Bolivia via Lake Titicaca shipping. It is advantageous,
furthermore, for Peru to maintain Bolivian good-will by protecting
this valuable outlet for Is Paz. Actually, the new harbor facilities
at the protected port-of Natarani are not subject to the Pacific
swells which endanger loading and unloading at Uollendo, and thus
have improved the safety of the operati%ns.
2, There is little integration between railroad policy and that of
other forms of transportation. ,
3. For strategic and military reasons the Peruvian govertrient is
interested in maintaining the railroad route into Bolivia.. Peruvian
flag steamers operate to Bolivian ports on international Lake
Titicaca.
4., There are no subsidies to privately owned railroads. The true
financial circumstances to State owned railroads cannot be deter-
mined because some maintenance expenses are not accounted for.
The extent of subsidization of state-owned lines is thus difficult
to ascertain. The government promoted the construction of a rail
extension to the protected harbor of gatarani, however, which im-
proVed the service between Bolivia (La Paz) and the Pacific.
5. The government's rail transportation policy is unaffeeted by vested
interests. The railroads are indispensable for moving bulk pro-
ducts. Terrain difficulties, however, have forced Peru to subordinate
rail policy to the requirement of highraa expansion.
B. ORGANIZATION
1, The railroads of Peru are controlled by the following agencies: .
Ministry of Development and Public Works
Bureau of Highways and Railroads
Railroad Section
Department of Adhinistration.
Department of Operations
Department of Engineering
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PERU - RAILROADS OONT010
2. The Bureau of Highways and Railroads is headed by a Director
General who is directly responsible to the Ministry of Develop-
ment and Public ?c4orks. A sub-director is in charge of the
Railroad Section which in turn has departments for Administration,
Operations and Frigineering, .
3. Highways and Railroads are coordinated within the Ministry of
Development and Fublic Torkso. There la, no direct, coordination .
between the Ministries responsible for the various media of trans-
portation. There is no appreciable overlapping or conflict be-
tween them or between the national agencies and the political
subdivisions.
L Formerly goverment supervision of highways, railroads and all
other public works was the responsibility of a Bureau of Public
Works and Transportation. This proved unsatisfactory and resulted
in a reorganization into separate specialized bureaus under
trained personnel,
5. There are no known plans for reorganization or the establishment
of new agencies. The present governmental agencies are considered
to be fulfilling their funitions adequatel. The railroad
agencies are operated for the public good. They are relatively
free from Political interference. Engineering is good, but there
is a need for more medhanized construction.,*
C. ALMINISTRATION
1. New railroad construction is decided by the Construction and
Studies Department of the Bureau of Highways and Railroads
after recommendations from appropriate commissions following
approval of the current budget, However there has been no new
railway construction of. importance during the last thirty years.
This emphasizes the priority given the highway construction in
national transportation policy,
2. The tariffs of privately owned public carrier railroads are
stipulated in contracts approved by law and renegotiated every
five-years. digher rates can be authorized only by new contracts
or by decree approved by the?Ministry of Public Works. The rate
schedules must be within the maxima established by the Bureau of
Highways and Railroads. Rates on state-owned lines connecting
both private and common carriers are patterned after the latter.
3. Basic government policy has, for the last fifteen years, favored
highway transportation against railway transport, by approving
the construction of roads which in some cases parallel the rail
routes. Motor transport units follow no fixed schedules, charge
what the traffic will bear, furnish inferior service, compete for
the best paying traffic, provide door to door service and are
primarily in the hands of non-liable individual driver...owners.
Consequently the railroads have not been able to increase rates
despite higher operating costs,
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PERU ? RAILROADS (C CORM)
h. Railway safety measures established by the Bureau of Highways
and Railways ire inforced by the Bureau's inspectors. Railroad
personnel is not subject to government regulations. Railway
accidents are investigated by both police and the inspectors of
the Bureau of Highways and Railways.
5. There are no government?fostered courses for training railroad
technicians other than the courses offered by the National School
of Engineering. Training procedures at this school are determined
by the Ministry of Educatien.
6, The Peru?Bolivia trade treaty of 1935 makes no mention of opera-
tional agreements, merely stating that Peru will furnish safe
conduct for tax?free Bolivian carte. The Southern Railway is
owned and operated by the Peruvian Corporation. Moreover this '?
corporation owns the Lake Titicaca steamship line and the rail
line from the Bolivian shore to La Paz. Through handling of
passengers and freight is an integrated operation by the Peruvian
Corporation. The Tacna?Arica railway, extending a fey miles into
Chile, is not subject to any operating agreements, 'Operations are
entirely under Peruvian government control. Free transit over
Chilean territory is provided in Article VII of the 1929 peace
treaty.
70 Railways must submit reports to the Bureau of Highways and Rail?
ways covering traffic, rates, and accidents. Traffic figures are
reported annually for analysis and compilation by the Statistical
Section of the Bureau of Highways and Railways. Routine inspection
reports are submitted to the same Bureau by government inspectors, ,
while aceident report's are forwarded to both the Bureau and the '
police,
3
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CHINA 4.4.IMAT TRAOPORTATION
A. POLICIES
14 The current basic objectives of the Cletnese National Govern-
merit with respect to railroads are: (a) restoration of war-
damaged or destroyed lines; and (b) modernization rhesmhr .
peaceful conditicinq permit. The ninistry of Commvnicatioes
has Given first priority to the repair of.the,:flentnin--
Nunking.(Puhow) main line, long-range Chinese rail pelidy,
originally ekpressed by Sun Yat-sen, and reiterated by Chiang;-
Kai-Shek, involves an eventual railway nettatk of 140,000
kilometers (present system about 14,0)0-1ams.). This ambitious..
and preoontly unrealistic Goal is considered by Chinese
planners?te be indispensable to China's ecohomic development
and political unification.
The present National Government has indicated a determination
to eicludo foreign interests from ownership and operation of
future Chinese rail developments. Control will be vested in
the National and Provincial Governments. Ck conciliatory
statement of the lithistty of Communications in 1945, inviting'
foreign capital to participate in the development of China's
'transportation, was careful to emphasize that the ultimate
aim would be state ownership.)
? ?
.2. .Strong contruliSed control of railwaysis effected through '
the Ainiiitry,of Corammications, Mhich is responsible fOr.all.
transportation, including civil aviation:
. ?
3.
StrateGic faCtors new dominates Chinese, rail policy, Particu-
larly in Northeastern.China...Even in south China, it is'
importantte keep the railroads operating wherever possible
for logistic teasonp. Military operation's in the civil Mar
.are directed largely toward Control,idisruption or'reinstute-.
vont of rail .lines. ?
?
4, The Chineee rail system is Governmont.,owned and is entirely,
dependent on GoVernment support. The operating: losses of the
individual government-owned lines aro absorbed by the natibtal
treasury, and construction 'A:ejecta can only be accomplished
as 'outright 6overzurtont undertakings.' Although 'new ,construction
? .is still effectively procluded 'by Ca.:alto economic crisis, the
Zhinebe Army is engaged in same patching up of' damaged lines..
. 5. Vested interests do not appear to play an importantrold in
influending Chinese rail policy. On.the other hand, railMay
policy clearly reflocts'historicali?-Geographic, economic and
political,conditions? . . . ,
The basic factors underlying modern Chinese history have pre-
.
ventod the development of an eztansive.nation-wide railway
?
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CHINA 0. RAILWAY TRANSPORTATION Al CONTLCI
network. The same circumstances, in fact, have operated to
stifle any substantial industrialization,and have thus re-
moved some of the incentive which impels railroad construc-
tion in areas possessing more advanced economies. Neverthe-
less, the 541a0 geographic conditions which have distributed
the Chinese population unequally (difficult terrain, di-
vergences in rainfall and fertility, the location of ports
and raw materials, and the river pattern, particularly that
of ths navigable streams) originally influenced the develop-
mont of Chinese railroads. Out of those factors emerged
economic requirements, such as the mood for rao-tring provincial
raw materials to the population centers and for distributing
food. These conditions have demanded, frequently without
satisfaction, a suitable adaptation of the means of transport.
Likewise, political conditions have reacted on railway policy.
One of the cardinal political principles of Sun-Yat-son was
the removal of foreign privileges. The logical rceult of
this 'nationalistic philosophy has boon the. exclusion of foreign
ownership and operating control from Chinese railroads, Pp
inevitable price of this policy/ however, is an increased re-
luctance on the part of foreign capital to support the expan-
sion of Chinese rail facilities.
Overriding the foregoing considerations, the exigences .of
war have dominated Chinese policy for more than a decade.
Chinese thinking has viewed the railroads almost exclusively
in the focus of military ovents; these facilities, a source
of defensive strength, have been repeatedly the objective of
enemy operations.
Te, ORGANIZATION
1. Tho Minister of Communications in the central Chinese Govern-
,ment controls railroads and all other forms of transportation,
including civil air.
2. The Railway and Highway Department is charged by Article VII
of the Organic law of the Ministry of Communications with
the following far-reaching railway responsibilities:
(a) planning and construction;
(b) control or operations and subsidiary activities;
(c) engineering and mechanical problems; .
(d). supervision of public and privately owned linos; and
(e) all other railway Matters.
The Railway and Highway Department has jurisdiction over the
? following subdivisions concerned with railroads: ?
(a) 4-.dministrations of the various railway systems, which
? operate under and are responsible to the Ministry ofN
. Communications;
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CHINA RAILWAY TRANSPORTATIOLLE.:.2.CONTIII)
(b) General Office of Railway Survey; and
(c) Railway Traffic Office
3. Transportation problems involving other Ministries such as
Foreign Affairs, Water Conservancy, Interior or Economic
Affairs are jointly studied, but final decision usually rests
with the Ministry of Communicatione. Major conflicts on
ratters primarily concerned with:transportationCan be carried
to the' Executive Yuan or the Generalissimo. There
tendency in the Chineao Government to allow Minietries'other
? than that of Foreign Affairs to decide mattors.involving
foreign policy. Sine-Russian railroad matteral,for example,
tvmld be .discussed by. the Ministry of CommuniSations directly
? with the Russian Embassy. I.
4. The Department of Railways and Highways-wss established at
the close of torld War .II.. Proviounly rail administration
had been in the hands ofa Rathay Ministry. The neod, for
increased efficiency and greater coordination caused the
Chinese Government to delegate feSponsibility for 'railroads
to the 2inistry of Communications.
5. The Ministry?of Communications,.through.the Department of.
Railways and Highways, undovbtedly attempts to operate the
i'ailroade in the public interest.- The factors which prevent
the Chinese railroads from satisfying more than a fradtion
of Chinala traneportation needs are entirely beyond the control-
of the able Miniater of Communications, General Yu Te-woi, who .
was trained in German and US (Harvard). Universities. The in- - ?
soluble Problems include vast equipment shortages, commandeer-
ing of facilities by the military, track removals or destruc-
tion incident to the 'civilwar, and inadequacy of national
funds for railroad reconstruction operations.
O.' ADDIDISTRATIOU' ?
1. Recommendations for the construction of new lines and the.
extension-ofaxisting linos are submittefly the Ministry of
Communications -to' the Executive Yvan for. final dedision. The
'National-Defense Minister, however, ray decide independently.
that the prosecution of the civil war demands the development
of rail facilitieS.
2. Prior to World War II, each'ruilway Administration proposed
La rate structure which wasintended to cover operating costs
or perhaps net a modest profit.. AfterapproVal by the
Ministry of Communications, these rate schedules at.;re sub-.
mitted.td the gxeoutive Yuan for final decision.
ik.to deterMination for all forms of transport is ruw complicated
by the severe inflationary trdnd of prices. Rates are no longer
intended.to coier.operating costs; rather, a system of RESTRICTEDgovern-
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CHINA ? RAILWAY TRANSPORTATION (C-2 CONT'D)
mont support amounting to subsidization has been introduced
in lieu of increased rates. ail? rates are occasionally
increased, they lag behind the inflation of prices generally,.
The Executive Yuan appears to believe that price increases,
rill be retarded if utility rates are kept low.
3. HO competition exists in railway transportation, as the rail-
ways are all owned and operated by the. Chinese Government.
Other media of transportation, moreover5 are so poorly organized
that their competition is not seriously felt by the railways.
4. With respect to railway operation, regulations govern the
inspection of equipment/ choice and employment of personnel,
and investigation of accidents. The Ainistry of Commumics-
tions can issue regulations of a purely administrative nature;
the Executive Yuan establishes major regulations of an
administrative or policy nature; and the Legislative Yuan and
State Council adopt statutory regulations.
6. Training programs were stressed by Dr. Sun Yat-sen in the
early days of the Republic. Mere reeently,,Generalissivo
Chiang Kai-shek, in his book, "China's Destiny" asserted that
the universities and vocational schools should produce the
following:
Civil Engineers
222.400
Mechanical Engineers
136.400
Electrical Engineers
41,600
Navigation Technicians
7,000
Transport Specialiste
37,000
Aware of the lack of trained personnel, the national goverment
sent 1,200 young students in 1944 to the US for training in
engineering and management at universities and in private
industry.
6. The Chinese railway network is connected with foreign territory
only by the Kunming Haiphong (Indo-China) line, and the
Manchurian lino running east from Hanchouli through Harbin
'to the Soviet frontier above Vladivostok. The China-Indo
China lino is the subject pf a now Sine-French agreement, con-
eluded in ibbruury, 1946. Under the terms of this agreement,
there shall be free exchange of traffic and equipment on the
sections of the lino owned by the tun countries within their
respective terAteries. Rates are to be established by a joint
commission. Actually, however, the agreement cannot begin to
operate until necessary bridge reconstruction and other re-
hubilitution has been completed within China.
The status of the Manchurian.railrays is regulated by an
Agreement accompanyingithe Sine-Soviet Treaty of Friendship
and Alliance, concluded in 1945. This agreement specifically
covers the trunk lines :,from Dairen to Hurbin and from Manchouli
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CHINA - RAILWAY TRANSPORTATIOLip=.6 CONT)
threttch llurbin to Suifenho, north of Vladivostok. Joint
mmership and ox-ploitatien of these lines is stipulated.
The USSR is given free tri.nsit of goods from the Soviet
naval base ut Port itrthur and the free port of Dairen to ,
the system's- connecticns with Soviet tbrritory. ? The Chinese
Civil tor, however, has 17tade imp:es:Able for the Chinese
? to keep the Manchurian lines in operation. thele 'sections
of trunk lines are in continuous ,Chinese COLIZalitiSt control,
while other sections, hold by the 1:ationalists, are
-sporadically cut by the ootnunist.t. After thirty years the
lines now jointly elated. will revert to the full -possession
? of the Chinese Govern:Lent. ?
7. lprior to lend .1:kr II the Chinese railroLd systems ,;viire
required to submit detailed d.atu on operations, as evidenced
,by the excellent- govc:rnmant railwq ,reports of that period.
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Uill TED T11...11SP.MTLTIOil
POLICII.X.
la It has been the basic policy of the UK with respect to road
transport to impose as little restriction 143 possible on
1ljg:way carriers. The. state interest has been to coordinate
hirlumay and rail facilities and to reuluto competitive
-practices which r.1:4.;ht prove harmful to the transport system
as a whole. 11161n-fay transport in the UK, as in other
countries, Was of relatively lainor importance before 1:or1d
7:ar I, but during the tuontien operations increctsed to a
point where they seriously threatened the position or rail-
roads with respect to (a) the transport of certain Commodities
and (b) certain short-haul operations.
Basic policies with respect to highway transport in the U?4
till be radeally olianed under the Transport et. effeetive
1 !January 1948. The act establishes a pritish Transport
dommission Izhich will .have potter "to curry :jowls und pussenners
by rail, road and inland watoraLy within Uiroat 24-itain."
Milo the ,et dies imixese curtain restrictions trpen the
autharity of the Comaissien, it is obvious that, as t. i_ractical
matter, road transport in Gra:. t 3ritin will be lar;ely
nationalized. Exceptions to the policy of nationalization -
will bo: (a) true:tors, 'oporatinc nut as comden carriers but
fur their own accoluit with their own vehicles; and (le) trial:ors
operating within sa radius of 25 miloc. Those WO :2r01.11)11 till
not be re,pairod to obtain omens:lent licenses for their
operations. (4.pproxinato1y 300,000 vehicle s owned by 150.000
small operators will be thus cncempt from nationalization.)
Public nighwaj carriers nut affiliated with tie railroads but -
subject to nationalization will be allowed considerable ?
latitude in opbrations at least; for the -,resent. Road carriers
0:mod by thz; railways will be subject to tao same nationc.lization
policies as the railroads.
2. Iiigirtn,y transport 1.eolicies, under provisions of tile now Trans-
port tot, will be determined and administered by the Road
Transport 4xecutive in the serLnsport Commission. ? The Executive
will be ?one of five such authorities apeointed by the ...lint:Aar
to deal with the various media of transport.
lii;hway transport policies in tne Ult. are unquestionably in-
fluenced by ?commie considerations (particularly tha effect
of road transport upon mil lines); strato:;ic u.id military
corzsiderationa have onl; u secondary role in the establish-
ment of such policies. The all :ni; influence or strategiC
planning in the development of al. :6.,;1r3ays is evidenced by
the Iasi. of an orz:: nizocl network of modern express lai;;Imays.
4. The governnont does net subsidize highway transport and the
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UNITED KIIIGDOM HIGHaY TRi.:1SPORTATION (A-4 CONT!D)
quotion has never been seriously raised in the UK. Tho
state, however, has been interested in the development
pf road facilities and-the extension of highways to'
benefit the general economy.
5. Highway transport policy has been influenced primarily
by the demonstration of the usefulness of highway transport
us an adjunct to rail and coastwfse operations. Policy .-
with respect to highway transport has been affected to a limited
extent by the ?vested interest of the rail lines.
B. ORGALNIZisTIOld'
1. The Road and Rail Transport Divisiorrin.the present Ministry
of Transport is the agency dealing directly with highway ?
transport. Under the Transport Lot, the new Road Transport
Executive will be the administrative agency for highway
carriers. The Transport .i.dvisory Council, a government.
sponsored organization 'to be set up by the Minister and .
ocmposed of representatives of all media of transport, local
authorities and laborp-will advise the Minister with re-
spect to coordination, improvement and development of trans-
port Generally. The Highways Division and the Highway
Engineering Division are responsible for construction and
maintenance of highways. The Roa&Rail- Joint Conference and
the Road-Rail Tribunal deal with rates. ? The London Passenger
Transport Board is a publicly-owned operating company in the
Ministry of Transport created under the London Passenger
Transport Act df 1933. Under the new Transport ict this
company, which handles all highway and subway passenger traffic
in the London area, will be under authority of the London
Transport Executive.
2. .There is a high degree of decentralization of authority in
the Ministry. of Transport v4th respect to transport problems.
The Road and Rail.Transport Division of the Ministry of
Transport is divided into three parts. Those deal with (a)
highway engineering, -(b) vehicle.maintonancep'and (c) ad-
ministration and policy., '
3. The agency dealing with road transport in the Ministry has
no direct administrative relationship with the other transport
agencies in the Ministry, ill are subject to control and
direction by the Ministry. There is no relationship between
highway transport Lconcies'and agencies dealing with civil
aviation. (civil aviation is organized under u separate
Minis try.) There is no apparent confliet in government truns.o
port policies in spite of some integration of road and rail'
transport thri:gh the acquisition of meter lines by rail
lines.
2
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UNITIX KIIIGDOM TR:IFSPuRLaTIO11 (13-4)
4. The present organization of the Ministry of Transport is
bused upon the Ministry of Transport jot of 1919. tIth
the exception of assuming control of the main lino rail-
roads and of the London Passenger Transport Board on
1 September 1939, and the acquisition of the functions of the
war-tine Ministry of shipping in 1946, there have been no
major ehanges in recent years. Under the provisions of
the Trahsport let, the present organization of the Ministry
of Transport will be considerably altered and expanded.
5. While general opinion is that highway carriers are operating
efficiently under present conditions, nationalization is
being accepted reluctantly as a necessary stop to help over-
come the present economic distress of the UK. '
aDIUMSTRaTION
1. Regulations concerning the establishment of new motor trans-
port lines are under the authority of the Road and Rail
Transport Division of the Ministry of Transport. Thelligh-
uuys Division and the Highway Hngineering Division are also
concerned with such questions, since they are the agencies
in the Ministry dealing with construction and maintenance of
highway over Uhich such operations would mare. '
2. Until 1938, there was little or no control over highway
rates. In 1968, the rail linos, in an effort to curb high-
way competition, asked for the right to fix their own rates.
The Transport Ldvisory Council, at the request of the Ministry
of Transport, thereupon recommended that a Road-Rail Joint
Conference revise the rate structures for both forms of
transport. Although the work of the Conference was interrupted
by the 'war, considerable progress has been made Ulnae then
in establishing equitable raters. Rates are subject to appeal
before the Road and Rail Tribunal in the Ministry.
3, The question of restricting or fostering competition between
highway transport carriers and other media of transport,
particularly rails, has boon a difficult problem in the UK
during the past 25 years. The rapid rise of highway transport
carriers as a competitive factor during the twenties led the
rails to ask the government for certain restrictions on the '
competitive advantages which highway carriers enjoyed with
respect to rates, routes and operating policies. The state
was sympathetic to the request of the railways and took stops
to compose the basic conflicts between road and rail transport.
Among the significant actions taken by the state to control.
competitionwere:
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RESTR I CTED
UHL Ti itliCrlaLl TRL.:SiVatt (0-6 ) )
(a)
The Road and Rail Tmnsportiot of lD43, mhich )revidcd
for the licensing of hichway and transport carriers,
thereby olininatiY,g Tally of the unorcanized or ir-
responsible carriers;
(b) The Road and Rail Central Conference, which came into
beiug only ,a few nontns prior to the outbreak of the ?
var. Thin Conference established procedures for
filing a few years before Forld War I the control of road
transport in the Netherlands was largely in the hands of
local authorities. The years after 'mad ,.7ar I, however, sew
a growing dependence Upen highway transport and increasing
competition between road and rail. The state, therefore,
took action to bring road administration under the direction
of the central government.
There appears to be general satisfaction with the CovernMentis
policy to rescue the road transport system from war-time dis-
integration. The highway carriers, however, do not like the
fact that, under the present organization, highway tax reve-
nues are being used to make up the deficits of the Netherlands
Railway/ Company,
?
C. AGMINISTR1TI04
All projects for new transport routes must be approved by the
Ministry of Transport and also by the Traffic Fund.
5. The government has a traditional policy of intervention to
regulate competition in transportation, but.natural economic
'-forces have had probably equal influence in determining the
final status of competition between transport media. The
principal competition to highway transport comeo frOm the rail
carriers. This competition applies both, topassenger and
freight traffic. In the early days of rail development, there
was considerable opposition on the part of the canal interests,
but the problem has solved itself; he canals handle slow,
bulky cargo, 'chile railroads, (and ree6ntly? highway transport
lines), concentrate upon speed and high-value, light-weight
cargo, as well as passenger traffic. Coastal g ocean-going
shipping and aviation offer tittle competition to highway
transportation; and little has been done to regulate such coml.
petition.
4. The Government Traffic Bureau in the Ministry of Transport is'
responsible for the enforcement of safety regulations and in-
spection. As a matter of fact, there are virtually no laws
covering vehiCle inspection, overloading or safety regulations.
This is partly the result of light highway traffic conditions
together with the traditionally lar abiding temperament of
the DutCh people. A private organization the Scientific Com-
mercial Car Institfle, has contracts. to inspect and certify
as to condition of- trucks belonging to members of one of the
large trucking associations. )
?
REiTRICIEb
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NETHERLANDS 1110H1TAY TRANSPORTATION (C*6)
? 6. Although there is no recognized European organization dealing
with international highway tranSport and traffic problems,
efforts have been made to break down the existing barriers
to free exchange of highway traffic. Some progress has been
made in this respect and there are weekly bus servicefrom
the Netherlands to several neighbOring countries. In May
1946, NIM).(Nederiansche Internationale Wegvervoer Organi-
satic) was founded; (a) to promote cooperation among inter-
national transport interests; (b) to function as intermediary
between authorities and :ransport interests? 'and (c) to su-
pervise the, activities of the highway transport carriers0
The goverrinent has granted NIVO a "special status" in inter-
national freight operations. 'Members of VITO include trucking
companies, rail lines, Chambers of Camerae and shipping op-
erators.. It has obtained the cooperation of other states for
the abolition of various restrictions on international traffic'.
'Among its major accomplishments has been progress in achieving
uniformity in international ,bills of lading.
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?
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A. POLNAIE
1. The published text as well as Soviet official commentaries
on The Fourth Five-tear Plan indicate that hiy,hway.donstruc-
tion and the development of private motor vehicle operation
.hold a lor priority in Soviet planning. The reeources of
the Soviet automotive industry will be primarily applied to
truck construction. By 1950 the industry is scheduled to
produce 500,000 vehicles annually. Of these, only 65,000
will be nassenger cars. -Bus production will total 6,400
units, rhile track production is -expected to reach 428,000
units. The USSR has indicated that in 1950 the national
truck fleet will have reached approximately double its pre-
war size. That the truck fleet will be still subjected to
- 'sewn operational limitations, however, is revealed by the
official statement that at leaSt throtgh 1950 large numbers
of trucks will operate on producer gas and other "local Awls".
The few existing "arterial roads" are to be "restored" and
completely overhauled, but apparently new first-class highways
are not to be constructed. Even the subsidiary "improved ?
motor roads" are to be extended by only about 7,000 miles
throughout the whole USFR during the entire five-year period.
While Soviet policy will emphasize use of the truck fleet as
an adjunct to the rail system in short-haul traffic, some
progress will be made in organizing longniistance hauling.
22. While the various media of transportation are controlled by
separate agencies, over-all coordination of transport policy
is the responsibility of the State Planning Commission
.(Gosplan).
. Prior to World War II, the Soviet highway system and the
volume of motor transportation did not satisfy the strategic
requirements of the USSR, and probably reflected little
. military influence. The most striking example of thif was the
failure 'to provide trans-continental highway communication .
between the Siberian Maritime Provinces and Western Russia.
The Soviet military, however, now undoubtedly exerts a strong
influence in planning of motor transportation development.
A substantial portion of the present Soviet trunk fleet; for
example, consists of lend-lease trucks tutted over to the
military authorities, who presumably still largely control
their utilization.
4. Subsidization in the USSR is an academic matter, since all -
economic activity is controlled by the State, and enterprises
will be developed or maintained, regardless of their degree
of self-sufficiency, if they serve the national interest.-
Both road construction and motor vehicle manufacture are covered
by specific provisions of the Fourth Five-Thar Plan.
FZESTRiCIT:D
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USSR - RIGWAY TRAI:SPORTATION (A-5 CONT 'D)
5. Czarist Russia and the USSR have never been able to develop
an aggressive and completely effective policy with respect
to highway construction and mechanized road transport. This
backwardness has been primarily due to a long-standing
combination of economic factors. Early railway development
satisfied minimum national requirements for long-distance
traffic, and the localized regional economies were able to
exist with roads of low capacity. The USSR did not have the
basic economic factors (rapid accumulation of capital, ?
potentially large consumer market, for motor vehicles, the
imagination required for the full exploitation of national:
resources, and a rapid rate of industrialization) which -
combined in the US, for example, to create a motor vehicle,
industry which in turn set up a compelling requirement for
.adequate roads. ,
B. ORGANIZATION
?
1. There are three Ministries whose jurisdiction directly
affects highway construction and motor transport in the USSR.
They are: (a) the Ministry of Internal Affairs, (b) the
Ministry of the Automobile Industry, and (c) the Ministry off
the Industry for Building and Road Construction Machinery.
As in the case of all other Soviet agencies, the State ,
Planning Commission is responsible for over-all Planning.
It should be noted, however, that motor transport in the
Soviet Union is not nearly so susceptible of centralized
control as are the other transport media, sinhe every
Ministry or other agency whose operations require any
substantial amount of trucking has a fleet of trucks under
its orn jurisdiction. Such dispersion of facilities
patently produces a diffusion of control not present in the
other transport media.
2. The Chief Administration of Paved Highways in the Ministry of
Internal Affairs is charged with all planning, financing,
construction' and maintenance work on the principal highways,
as well as regulations for their use. The Road Administrations
of the various Republics perform similar functiOns for those
roads under their jurisdiction. The Ministry of the .Automobile
Industry is responsible for basic planning and execution with
respect to production of motor vehicles in accordance with
over-all state planning. The Ministry of the Industry for
- Building and Road Construction Machinery is charged with basic
planning and execution with respect to production of heavy
equipment required for road construction and maintenance
programs. :
3. While there is no direct administrative relationship between '
the agencies listed in 11-1 and the other state agencies, the
activities of all the Ministries are coordinated by the State
Planning Commission.. The nany government agencies utilizing
thelr own fleets of trucks doubtless encounter administrative
conflicts with the 3inistry.of Internal Affairs. ?
2
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o
USSR HIGR-AY TRATXPORTATION (grial
4. After a period of shifting responsibility during the early
years of the Soviet regime the responsibility for road
construction and other matters relating to highway transport
was placed under the Commissariat for Domestic Affairs, as a
.result of which considerable progress in road construction
was made. In 1936, the Chief Administration of Highways was
created within the Commissariat for Domestic Affairs to
administer and coordinate awidely decentralized, program.
In March 1946; the Commissariat for Domestic Affairs became
the Ministry of Internal Affairs.
5. The basic social philosophy of the Soviet system postulates
that all activity is carried on in the nubile interest.
There is, however, little basis for claiming any high degree
of efficiency in either highway construction or motor trans-
port operations. Soviet highway standards are far below
those of the United States, and the poor quality of Foviet
maintenance and repair facilities becamenotoriouely evident .
during the late war. That the Foviet Government is aware of
the shortcomings of its highway facilities is evidenced by
the open criticism in the press of officials responsible for
the serious lag in the fulfillment of state plans with
respect to road construction.
C. ADMINISTRATARI
1; The establishment of new highways is the responsibility of the
Ministry of Internal Affairs'. Over-all authorization for new
highway construction; however, is provided in the five-year
plans of the State Planning Commission.
2. Since the agencies requiring any substantial amount of motor
transport maintain their awn truck fleets (see B-1) and '
private traffic is unimportant, the question pf rates on
motor transport traffic is largely meaningless. In those
instances where one agency transports goods for another, the
carrying agency sets the rates at a point calculated to
return a normal planned profit.
3. There is no competition between highway transport carriers
beyond state-sponsored asoCialist competition" for the
purpose of increasing efficiency; reducing accidents, etc.
There is little competition between the various media of
transport, since all are used to capacity and beyond.
Furthermore; operations of all media are integrated within .
the over-all transport plan of the state.
4. Highways and equipment are subject to very strict rules
established by the Ministry of Internal Affairs concerning
? operating safety and inspection of equipment. Regulations
require constant inspection and necessary repairs at all
times, as well as periodic inspections and scheduled over-
halite at specific times. Accidents are investigated officially
and negligence is severely punished; the offenders being con-
sidered ae "enemies of the people".
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-3
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:RESTR I CIE"
lop - H/GH7AY TRANSPORTATIOLiall
5. The etate has prepared extensive programs for technical
training in transport, maintaining a number of schools for
that purpose, Operating personnel must pass examinations
and be licensed. .Secause of the poor distribution of re-
pair facilities; every chauffeur or driver is supposed
to be qualified in repair and maintenance. Procedures for
training of technical personnel are under the authority of
the linistry of Labor Reserves, while the Uinistry of
Internal Affairs establishes regulations for the licensing
of highray operators.
6. International agreenents new in effect concerning highway
transport problems are limited to incidental provisions of
bilateral trade And political agreements between the USSR
and its neighboring satellite states.
7. Highray trar sport is no exception to the generalization that
the intensive planning of the Seviet economy necessitates
the preparation of many reports covering all aspects of
operations. The Ministry of Internal Affairs requires
various reports dealing rith commodities carried, operating
costs, accidents, etc.
4
fa.
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(01
?
I
\ ? ?
?
/
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RESTR I CTED
%SWEDEN - HIGHWAY TRAESPORTATION
Ao POLICIES
10 Highway transport is second in importance to rails in the,
transport economy of Sweden It provided the flexibility
of transport essential to the economy of Sweden where indus-
try and population centers are scattered to such an extent
as to make concentration of rail facilities unprofitable.,
The basic policy of the Government with respect to road
transport is to allow the highway carriers a large degree.
of freedom of action, Policies of restriction are practiced
only as required by the overall interest of the utate,
20 Policiee concerning road transport are determined by the
Board of Roads and Waterways in the Ministry of Communica-
tions? The policies determined by the Board are not subject
to the control of any authority other than that of the
Ministry of Communications, which integrates and coordinates
all policies dealing with communications and public works,
3, Strategic and military considerations have had relatively
little influence upon the highway transport policies of '
Sweden, The geographical position of the country together
with its topography would render ineffective any attempt to
base transport policies upon strategic and military cone
siderations, Swedenta historic policy of neutrality in
international conflicts also has permitted emphasis on '
economic needs rather than those of a military nature.
4. The Government does not directly subsidize highway transport
operations, but it does expend considerable sums on the
construction and upkeep of highway facilitiees
B. Policy with respect to highway transport in Sweden has been
developed by three factors of primary importances The first
of these is the vested interests of the, rail liness both
private and state owned, whieh has influenced policy to
favor rail lines. In contrast, however& private interests
represented by industrial organizations have urged the
development of highway transport, since such transport Pure
nishee flexibility needed for fast, cheap, door-to-door
transport,
The second factor which has influenced highway transport
policy is the relative ease with which highway transport can
be established and maintained, maintenance cost being par-
ticularly heavy on Swedish fail lines'becausseof weather and
terrain0
The third, and possibly the most important factor influencing
highway policy is recognition by the state that despite its
financial interest in the' rail lines, highway transport en-
joys a tremendous advantage in serving a population so widely
scattered as to make rail operation uneconomic in a large
part of the country,
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SWEDEN .., HIGHWAY TRANSPORTATION
Bo ORGANIZATION
1. Highway transport services are under the authoeity of the
Board of Roads and Waterways (VAG - OCH VATTENBRGGeADSSTYREL-
SFN) in the Tfinistry of Communications.
2n The Board of Roads and Waterways has administrative control
over all highway transportation and inland waterways, but
through a policy of decentralization of control the provine
cial governments are given authority to issue concessions
for operations and to-establish rate schedules. -Inter-
province traffic rates are determined by that province in
which the greatest portion of the travel is performed.
Inter-province concessions are assigned through mutual agree-
ment of the provinces concerned,
30 The Board of Roads andNaterwayse in addition to technical
and administrative matters regarding roade? has authority
regarding ferries, canals and inland waterwaye, There is
no administrative conneetion, however, between the agencies
within the Board, dealing with highways and the agencies
dealing with waterWaym. All activities and polices are
directed and coordinated by the Ministry of Communications,
There is no relation between these agencies and the agencies
dealing with merchant shipping and civil aviation, and no
overlapping or Conflict between the various agencies is
apparent?
There is no apparent -consideration being given to reorganizing
the present structure of the Ministry of Communications as it
affects road transport, nor is the creation of nevindminis-
trative agencies under consideration,
The policies regarding road transport; as laid down by the
Board of Roads and Waterways, appear to meet with the general,
approval of all 'parties concerned.
C. ADMINISTRATION
10 There appear to be no legal barriers to the establishment of
new highway service's forpassenger and freight, Routes and
rates must be authorized by the provincial government's to be
served.
2, Proposed rates are determined by the operators and submitted
to the provincial authorities in whose territory cervice.is
proposed, Approval of such rates is readily given since
inequities may be subject to review if protested,
30 Free competition between transport media is a basic policy
in Sweden, However, highway rates leadingto deficit opera-
tions are discouraged as being inimical to the public
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RESTR I CTED
SWEDEN - HIGHWAY TRANSPORTATION (04 CONT'D)
interest, (Such operations adversely affect the rail
systems, in which the state has a financial stake.)
In recent years, the railroads, in order to combat cows
petition, have lowereu their rates one organized truck
operations in an effort to meet the competitive door-to- '
door service offered by the road carriets.
40 There is to uniform legislation applying to the country
as a whole with regaru to inspection and safety regulations.
Such regulations are the responsibility of the provincial
governments and indication are that such enforcement poli-
cies ere not entirely successful.
5. Thera is no evidence 'of any particular interest on the ,part
of the Government with regard to training of technicians in
the field of highway transport, Sweden is noted, however,
for a number of excellent technical schools whose curricula
include instruction in such matters.
60' Highway.transport carriers in Sweden have much to gain
through the conclusion of international agreements con=
cerning traffic, facilities/rates and other related mat-
ters. The general apathy of European governments,, hewever,
toward international highway transport and the strong posi-
tion of the railroads in most countries has retarded the
development of such agreements, At the present time, there
is a considerable volume of long distance bus traffic
operating passenger service weekly from Sweden as far south
as Paris through neighboring states. In addition, long
distance truck operations ?have grown _rapidly, and at present
there is considerable international traffic in fish and
similar products. Mile the restoration. of highway trans-
port is notable, one factor acting to retard development of
highway operations, international as well as domestic, is
the acute shortage of vehicles,
' a 3
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c
* \
V.
or,
-
1
7
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PRE-WAR GERMANY - HIGHWAY TRANSPORTATION
A. POLICIES
1. Information on transportation policy in general is contained in
A-1 of the Pre-War German study on railway transportation.
Germany, like practically every other government of Continental
? Europe, was intent on protecting the government-owned railroads
? against the competition of the highway carriers. Licensing re-
quirements for existing long-dibtance freight carriers were very
stringent, and no licenses were issued to new carriers from August
1933 to the summer of 1938. More important, the law of June 26,
1935 kept automobile trucking rates aligned with those of the rail-
roads.
The civilian passenger car? as. long as the Volksiagen remained an
unkept promise, was important. There were numerous bus lines, run .
by the Reichspost, the Reichsbahn, and private enterprise, but
about 90% of passenger traffic, both lo-g distance and local, used
the railroad. In view of the relative unimportance of trucking
and passenger traffic, and pf the civilian motor car, the famous
Autobahnen? and indeed Hitler es whole road-building program, can
be explained only as a rather grandlous gesture. Probably the
larger purpose of the scheme was to provide employment, with con-
siderations of prestige and military strategy playing a secondary'
part.
3. See 4-3 of Railway Transportation for a general discussion of
strategic and military considerations.
4. The financial maintenance of the Reichsautobahnen was entirely
secured by subsidies from the Ministry of Finance in the form, of
a certain share of taxes. While in theory these roads were entitled
to collect contributions from their users, no such contributions
were infect ever levied. During 1937 allotments from tax and duty
receipts to the Autobahnen totaled 197,092,534 RM. Of this total,
104,600,000 RM came from the mineral oil duties, 61,700,000 RM from
the mineral oil tax, and 30,800,000 RM from the transportation tat.
Any temporary financing was obtained by short and medium-term bills,
drawn on the Reicha-Autobahnen-Beschaffungs G.m.b.g.? which Was a
department of the Deutsche Verkehrs-Kredit A.G. (the banking institu-
tion of the Reichsbahn.) These bills could be rediscounted by the Reichs-
bank with the indorsement of the Deutsche Verkehrs-Rredit Hank. The
total indebtedness of the Autobahnen on December 31, 1937 was stated
to be:
1.
Acceptance Credits
450 million E1
2.
National Railway Loan
400 .
"
n
3.
National Unemployment
'Insurance
375
'fl
n
4.
Old Age Insurance Office
100
it
n
5.
Ministry of Finance
300
- "
II
6,
National Association of
Insurance CoMpanica
.
237.2
"
It
7.
Others
33.6
n
fl
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? . PREAVAli GEREANY ii1G11WAY TRaRt1.011 (A-4 CuET?121
The foll.owing table shows the expenditures of Reich, states and
municipalities for the highway system:
Expenditures for Construction and Lain-
Valiance of German Roads (Millions of RM)
Other Roads
Autobahnen fiiaintenance Construction.
building and re- & Reconstruc-
expenses tion_
Total
Average
?
1927-29
me-...
42700
57000
1042,0
1C32
____
287,5
15008
438.3
1933
11.5
.321?.?
360.1
7033
1934
232.3
334.1
431.0
997,4
1935
476,9
34409
437.3
1255.1
1C36
617,8
317.3
471,5
1406.6
1937
663.5
315.0
525,0
150305
1538
'850.0
310.0
540..0
1700.0
.'Neither passenger nor freight r ad traffic were subsidited by the
Reich, The transport tax for long-distance freight traffic was 7%,
and that for paAsenger travel was 12%. ,
5, See Railway Transportation, A-50
B. ORGANiZATION
10 All the local political authorities charged with the adniristra-
tion and upkeep of the highways were subject to the supervision
and control of the Inspector General rf German Roads, Important
highways, classified as national roads, were financed by the ration,
and administered by the Inspector General through the state and loe.
cal authorities, , Roads of primarily regional significance were des.,
ignated as first or second-class roads, according to the importance
of the area they served..
First-class state roads were financed and administered by the State
and provincial authorities; second-class roads by the counties and
districts. The Inspector General appointed the technical members
of the administrative boards for these roads, The layout and manner
of construction of the super-highways (Autobahnen) was his peraonal,
responsibility, although actual construction and management were
handled by the specially created Reichsautobahnen Company, original-
ly a subsidiary of the National Railroad.
The decree of October 6, 1531, as subsequently arended, gave the
lanister of Transport the all-important power of fixing minimum
rates for freight traffic, In 1935, all farms engaged in the trans-
port of goods for the account of a third person in operations over
50 kilometers were required to become members of the Truck Cperators
Association, or Reichs-Kraftwagen-Betriebsverband (RKS). The
main functions of this association were the organization And regu0
lation of long-distance road freight transport, the distribution of
Freight orders among members, the invoicing and collecting of bills
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PRE-:7AR GERVANY - HIGHWAY TRANSPORTATION (Bel CORM'
on behalf of its members, and the compulsory insurance of all freight.
At the same time, the RKB was incorporated bodily into the structure
of the National Transport Group as the sole representative of private
trucking.
See also B of Railway Transportation study.
C. Da_RATION
1
I. This question is not strictly applicable; since the governmental
policy was one of restricting rather than expanding transport
facilities and enterprises. For specific information, see the
relevant sections of this report.
Under a law of 1934, amended in 1937, the operators of road pas-
senger services were required to obtain licenses, and sanction for
alterations to licensed Services, from the Ministry of Transport.
Passenger traffic was in the hands of three groups of operators, '
namely', "private ent-rprise" (usually a municipal corporation), the
Reichspost, andethe Reichsbahn. Private enterprise was regulated
by Under-Secretary K in the National Ministry, and represented in
.the National Transport Group. The Reichsbank and' the Reichspost
were exempt from licensing, being requireB only to notify the local
authorities of their intentions 4 weeks before beginning a service.
2. The emergency decree of October 60 1931 on "Inland Traffic with
, Motorized Vehicles" compelled the common-carrier long-distance
truckers to adopt the Reichsbahn tariff rates toto. In 1935-
36 the entire German trucking system was organized under strong state
pressure for the purpose of compelling.the truckers to abide by
the prescribed rates: The public organization so founded, the
Reichs-Kraftwagen-Bertriebsverband.(usually abbreviated RKB) pro-,
cured orders for individual firms througha new-work of cargo space
distribution agencies (Laderaumverteilungsstellen); took over the.
"billing, collecting and parra-mt of freight monies" (to avoid the
possibilities of price-cutting), and insured the freight carried.
,To all intents and purposes, the truckers became employees of the
RKB. The freight rates established by the Reich Trucking Tariff of
March 30, 1936, were worked out by the RKB in agreement with' the
Reichsbahn? with the Minister of Transport as arbiter. The basic
principle was that railroad and trucking ratep for the 4 meet ex-
pensive classes of commodities (Reichsbahn classification A to D)
were to be the same. That commodities in the cheapest classifica-
t;ont (Reichsbahn classifications E to G) were to be forwarded by
the highway carriers only at class D rates was relatively unim-
portant. The unfavorable position of high value goods in less than
wagon loads on the railroad, as for example, paper, beer, chemicals,
is obvious. The tariff mantled the technical advantages of the
truck over the railroad. In.addition? the embargo on licenses was
'continued.. Thus the membsrship of the RKB declined from 9,230 mem-
bers in 1936 with 12,791 trucks to 8,752 members with 19,201 trucks
in mid-1938.
In 1938, when the transportation crises occasioned by the building
of the West Wall, the incorporation of "Irredentist" lands to Ger-
many, and the increase in military preparation became clearly.vis-
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111611i14Y TItA1;67311TATION (0-2 CLNT.j
? ible, reatriCticns on licensing were lifted, But the action came
too late to be of mean:ng, A truck ordered. in 1938 would have been
received in 1940, wen the shortage of' gasoline kept all vehicles
off the road.
3, Since the fixing of tariff rates is the single most important Inc.
strument of regulating transport competition, this question is
implicitly answered in the answers to question Cn2.
4, There were no peculiarities in the German administrative system of
safety regulation And inspection which require enumeration here.
The only difference from commonly accepted practices lay in the
high degree of centralization within the Ministry of Transport.
.5. The National Socialist _utorebile Corps (Nationa2.sozialie_tische
Kraftfahrer Dina), usually abbreviated NjKK, wes, t use the Nazi
language, the primary "organ of the political will to motorization,"
The NSKK arranged a schooling scheme under the title "Youth at the
Rotor." .Sy 1938, it was estimated that 200,000 young men had re-
ceiVed preliminary training designed to make them better recruits
for the panzer and motorized divisions. The MotoreHitler Youth,
with a membership of 100,000 in 1938, was under NSKK tutelage, as
were parts of the German Labor Service. On January 27, 19391a
Fuhrer decree made the NSKK the exclusive organ for all pre-ard
post-military training in the motor field. The decree was im-
plemented by an organization of 23 motor snort schools, for "leaders"
and "experts") 2 national schools, and a technical drivers? univern
city at Munich,
By 1938, there were:5.5,million licensed vehicle drivers in
Germany. The licensing process was begun by an application to
the local police, who forwarded it to the regional police. The
examination of the candidate was made by an "expert" (Sachver-
st6diger), appointed by the Linister of Transnort and usually
an NSKK man, with a degree in mechanical engineering and 2 yeart?
experience. The licentine standards were in all essentials comb
? parable to those of the United States. However, there were 4
? classes of licenses, in accordance with the type of vehicle to be
driven:
IQ Motorcycles with a cylinder capacity of over 250 c.c.; ,
2. Motor vehicles, weight over 3.5 tons, and truck trailer
combinations with more than 3 axles, regardless of weight;
#5,,. Vehicles with cylinder capacity of 250 c.c., or less, and
maximum speeds less than 20 kilometers per hour;
40 All others.
60 As of September 1, 1938, Germany had ratified the road and motor
traffic convention of the League of Fiations. Germany also be-
longed to the International Federation of Commercial hotor Users.
c4 c,
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CANADA - HIGHWAY TRANSPORTATION
A. laaLICZES
2. The Dominion Departre'ntof Transport was organised in November.
1936, to unify the control and cupervision of railways canals,
harbors marine and shipping agencies, civil aviation and
radio. Dominion control over highway transportation0 however,
is slight,
The various agencies regulating transport operate very close
to the Cabinet and look to that nource for major policy. The
Minister of Transport, however, has lost much of his responsi-
bility to the Board of Transport Commissioners, the Air Trans-
port Board and the Maritime Commission, all three of which are
largely autonomous.
?
4. The Canadian Government does not extensively subsidize highway
construction. It VW not until the passage of the Canada High-
ways Act in 1919 that cash subsidies were provided toward the
,construction of highways considered to be of interprovincial
character. During the following nine years 1:20,000,000vies
granted for the purpose. During the period of acute unemploy-
ment between 1930 and 1937 slightly more than 042,00,000 was
spent on highways of national significance. Of this amount,
e19,000,000 went to the Trans-Canada Highway, designed to run
from the Atlantic to the Pacific entirely in Canadian territory.
The Alaska Highway, 1,600 miles of roadway, 24 to 36 feet wide,
extends from Fort St. John, British Columbia, throueliThite-
herse,'to Fairbanks, Alaska. The Dominion Government supplied
the right-of-way and the United States Government, through its
Vier Department, carried out the construction work. The Canadian
section of the highway from Edmonton to the Alaska border was
taken over by Canada at the end of the war. The Cariadian sec-
tion, now known as the Northwest Highway System, is being
operated for the present by the Canadian Army.
B. ORGANIZATION
1. (See B-1 of Railway Transportation.)-
In the field of highway development, the British North America
Act very clearly left to the provinces jurisdiction over pro-
vincial highways. This right has been jealously guarded. As
a result the Candaian highway system is largely a patchwork
of provincial highways. A Canadian who wants to drive from
east to west 'invariably does so by dipping south through the
United States.
It follows that Dominion control over highway traffic is
slight. The Dominion may regulate only with regard to inter-
provincial and external trade. It may incorporate coepanies
whose purpose is interprovincial transportation. athin the
authority contained in the British North America Act some con-
trol is exercised through the Board of Transport Commissioners,
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CANADA HIGMAY TRANSPORTATION (B-1 COW?' D)
which requires that trucking rates. be filed with them. Due
to the Board's alithority to approve or disapprove railway
rates, it can to a very large degree influence truck competi-
tion. The authority of the Board, however, has not been
clearly determined. In fact, the authority of the Dominion
Government in regard to highway location and construction
leaves much to be desired from the national viewpoint.
As has already been indicated the provinces jealously guard
their almost exclusive jurisdiction over highways. Each
province has its own highway department which issues opera-
tors' licenses and registers and regulates motor vehicles.
Traffic regulations are either provincial or municipal in
nature.
5. In the main, the Canadian agencies handling transportation
policy are regarded as operating 'efficiently in the public
interest.'
C. AMIELNISTRATION
' 1. The establishment of highways is almost exclusively a matter
of provincial regulation. The British North America Act per-
mits the Dominion to, project itself into the picture only
insofar as interprovincial and foreign commerce are concerned.
This is interpreted in a very restricted sense with the result
that it has effectively prevented national planning and de-
velopment of a highway system.
2. (See A-4.).
There appear to be no international agreements in the highway
field to which Canada is at present a pasty.
5. The government does very little to foster dr regulate training
of technicians in any of the fields of transport.
The number and variety of reports which are required to be sub-
mitted to the various supervie cry agencies of the government
are too numerous and variable, to permit listing: Such a list,
if it were possible to compile, Would change substantially from
day to day. The nature of the replies to the questions pre-
viously' covered is believed to indicate in a broad sense the
nature and extent of the reports desired. The Dominion Pureau
of Statistics, for purely statistical purposes, requires numer-
ous reports as to traffic, materials used, employment given,
and so forth. Rates in all cases must be filed with the appro-
priate supervisory board or agency. Practically all details
as to the operation. of common carriers are supplied in printed
form to the public by the Dominion Bureau of Statistics. Fur-
ther information is made available through the annual reports
of the Department of Trade and Commerce, the Board of Transport
Commissioners, the Department of Transport, and' others.
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CANADA - HIGHWAY TRANSPORTATION (C-7 CO1T.1D)
Similarly information is published annually in the Canada Year
pook and in special reports Periodically made by the various
,agencies. These reports make it evident that transport com-
panies file a large variety of reports and forms during the
course of operations.
(
? 3 ?
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BRaZIL . ? HIGMAY TRANSPORTaTIOU
A. POLICIES
1. The basic Brazilian policy covoring highways has, as its
long tango objective., the construction of a Fedoral network
of main highways connecting tho existing local state systems.
This has been the expressed aim of sevens]. successive .
Brazilian governments. Prosidont Vargan.announced in 1944
that it was a responsibility of the Ministry for Transporta-
tion and Public Lorks to "... organize a general plan of
transportation devolopment and road building for the entire
country in order to develop it gradually and in accordance
with public necessity; and not in pursuance of occasional
private interests.," '
Under the "now stator% highway building policy is detormined
by the Federal government. formerly road construction was
loft to the initiative of the States, with the result that
there are fats through highways connecting the local networks
spreading out from the port cition of Recife. Bahia, Rio de
Janoiro, Sao Paulo, Porto allegro and Rio Grande du Sul.
Brazil has adopted a hands-off policy with respect to controls
over highway motor transportation. Tho government apparently
believes that a badly needed expansion of motor transport in
nest likely to occur with a minimum of interference. Tho only
control of motor freight operations consists of a statistical
cargo chock when motor freight pastas from one state to an-
other. Punnonger transport on the highways is subject only
to govornmont approval of rates. .
2. 'ail? higiamya, railroads and inland waterways are the ro
sponsibility of the Ministry of Transportatian and Public
1:orks, it appears that the respective departments of the
ilinistry function almost autonomously, and there is little
integration of policy Idthin the Binistry on the various
media of transportation.
3. Highway policy has boon influenced by strategic and military
considerations to a limited degreo. During Lerlci Oar II tho
abnonco of an efficient coastal highway not was a .substantial
weakness in view of Brazilian and Llliod shipping looses, .
which reduced the volume of vital port-to-port coastal shipping
traffic. The national highway plan (seo.A.4)_now takes into
consideration a pOssible rupture of coastal shipping. under war
conditions. Tho Uinistry of rar has constructed some purely'
military roads... Tho road from Sao Joao in Santa Catarina to
Bariacao on the Lrgontine frontier, for example, was con-
structed by military onginoors.
4. Subventions have been granted for many years to encourage local
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BRAZIL - IfLGIMAY TRE4;ISPORTZ21014 (A-4 00171'6)
road construction. Tho Fodorul Uovernment will now directly
control the major highway developments in Brazil under
National Highway Plan, which was drawn up by a Special'
Committeo appointed by the Liinistor of Transportation and
Public Works. Tho final report was completed in 1913, and
its conclusions became law in 1944, (Plano liedoviario Nacional). -
The proposed national highways aro classified into three
groups: (1) north-south, or longitudinal highways (2) east-
west, or transversal highways, and (3) connecting highways.
The torn "national highway" is defined as a ruin road thich
assumes nationul importance by:
?
a, connecting to) or more Status;
b.' reaching or approaching within 150 lana. of the
country's borders;
c. giving access to maritime river or lake ports
operated under Federal oonoossion;
d. forring part of tho Pan-American system;
o. being of military, administrativo or tourist
interest; or
f. being an indispensable link between trunk highways.
The National Highway Plan includes the folloWing projected
highways:
Gotulio Vargas - coastal route Belem to Jaguars?
Pan-Nordostina - Sao Luiz to Salvador.
Trunsnordostina - portulezza to Salvador
Trunsbrasiliana - Belem to Santa Jam do Livraraento
Amazonian - Santarom to Porto Don Carlos
Acreana - Cruzoiro du Sul to Cuiaba
The entire plan includes approximately 20,000 kms, of north-
south and 14,000 kus. of transversal highways plus about
5000 kiss, of connecting branch roada. 'Chile the plan is
ambitious, it is cupablo of fulfillment within .8 to 10 yours.
The National 'army Fund, nude up of rocoipts Dmna Fedora].
taxes on fuel and oil, and from motor vohiclo import duties,
will help to financo the National' Highway Plan. The fund is
distributed as follows:
40;1 to the National Highway Department;
60;;; to the States, which receive aid on the basis of:
3V; to States in'ptoportion to local tuxes
collectod;
12:;.; to States in proportion to population; and
12:; to States in proportion to urea.
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HIGHTIAY THABSRBITATIOU (A-5)
5. iLifaway policy Is influenced by economic), political and '
geographic considerations in that order of importance. The
projected highways will open up large areas of Brazil for
an expansion of internal. trade, tad will lessen the country's
dependence on coastwise shipping. The young 13razilian
writer, De :31i, expressed a widespread view an highways in
asserting:. "the cduntry has skipped the railroad era
further funds should go into the construction
of highways."
B. omiliaziaioN
1. The Ministry of Transport and ,Public lurks controls all forms
of transportation except civil air. 'within the Ministry, the ?
ilational Highway Department handles, all mutters concerned
with higlways. . The 'Car Department, however, jointly controls
certain highways 17 i t 11. the Ilinistry of Transport and Public
eorks. The .Ilational 11.1.;hway Department supervises road con-
..struotion?in southern and central Brazil, while the Federal
Irrigation or Reclamation Service (Inspectoriu Federal do
Obrus Contra as Soecus) constructs highways in. northeastern
Brazil for the Einistry of Transport and Publics. The
War Department, -moreover, has used its highway battalions to
build certain highways, particularly those extending the -not-
works of southern Brazil towards the borders of Paraguay and
Bolivia. It appears that t.lese roads, of first-stage construc-
tion, are considered to have military significance.
2, The Autional Highway abpartnont controls technical and ad-
ministrative services pertaining to studies, projects, specifica-
tions, budget, trafAc.policios, finance.' and? through delega-
tion of authority, road building activities curried out by ?the
States, 17ur aapartnont, and the Reclamation Service. The
national Highway Sopartzlent has -the; following Divisions:
I. Deliborativu Divisions
a. Highway Council
b. bxecutive Council
II. Fiscal Division
a. Financial Controls
III. Executive Divisions
a. Director General
b. Technical Services
C, Judicial
d. Adndnistration
? \
It is the function of the Ifo.tional Highway Department to ad-
minister the listional Highway Fund. (See A-4). Each state
in the United States of Brazil has its own State Highway bepart-
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BitaZIL - BIGITC;:a TliatiSP0RTJ.TI0N (3-2 COHT ,ll)
mont. Tho more progressive states along the coact, especially
in the vicinity of Rio de Janeiro end Sao Paulo have constructed
outstanding oxamplos of modOrn higlwaya undor tho general super-
vision of the National Highway Department.
3. There does not appear to be much organized coordination of
tho various forms of transportation within the Ministry of
Transportation and Publics 'iorks. Coordination achieved during
the war with other dopurtments is rapidly disappearing. Thera
is no fermi relationship with the civil aviation agencios in
tho Lir Ministry.
4. The construction of modern highways began in Brazil about
twenty years ago. Various states had organizod highway depart-
ments before tho establishment of tho iAideral Roads Commission
in 1927. In 1930 the Commission was abolished by the Vargas
regime and in 1937 the National Highway Dvpartmont was created
under the Ministry of Transportation and Public t:orks. Decree-
law author 8.463, dated December 27, 1945, CWOD tho National
Highway Dopartment a more autonomous position uithin the
Ministry. The same decree created tho National 11541rway dund
and directed its administration by the Jail:mai Highway
Department.
5. .:11 agenoios concerned with highway transportation aro attempting
to administer policy of:iciontly and in accordance with the
public interest. Tho y are handicapped, howover, by local state
politics, military considerations and financial problems.
C. iHMINISTRLTION
1. Tho National Highway Department determines tho priority of
new Federal highways in accordance rith tho National Highway
Plan (Docreo No. 15193, March 20, 1944). In.contrast to the
US system of highway devolopmont, where state construction
stems from local roads and .:;bderal construction from State
systems, Brazil works from the top down, the Foderul Govern-
ment holding tiu.t it should initiato highway construction
throughout tho country.
Tie expanding motor transport passenger lines in brazil operate
under concessions granted by tho National Highway Departnont,
after requiremonts regarding their financial reliability and
the typo of their equipment aro nut. Tho implomentation of ,
them, controls by the National Highway Department, however,
appears not to have roached all state and local vole0 Tho
State of Pernambuco, for example, is roported to have deviated
from Fedoral controls by permitting all vehioles to transport
passengers. Lttor transportation is encourtc:od in this state
by very elastic local regulations. Trucking operations aro
not regulated in Brazil.
A
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Bith.SIL ILIGIRLY TRaNSI'ulfTaT1011 (C-2)
2. The Autienal Deparbient ostabliched pasaengor rato
schodules on u passon:pr-kilometer basis, varyins with the
kind of roud surface over which tho vohielos pass, and tho
type of vehicle operated. There are no ?facially established
motor freight rates in Brazil. ?
3. There is practically unrostrictod competition in highway
'transportation, passenger and freight, throughout Brazil.
HighWay passenger transport has become increasingly competitive
to the railroads. In spite of varying highway conditions,
bus tine batman tho cities of Sao Paulo and Curitibap.for
example, .is 12 hours fora distance of 523 kms., against a
train timo.of 26 to 30 hours. This difference reflects the
disjointod nature of Brazilian rail development.
4. Tho Arazilian -41ational Transit Coda, 19411, governs highway
` sufoty and accident investigations. It also contains voluminous.
rogulations regarding tho qualifications of automotive vehicle
ovoratora. The thoroughness of tho. rogulations 'lb illustrated
by tho provision that professional drivers must ::ass physical
aneaminations, aptitude and technical tests, nunt tau:ors? sanity
and character investigations, puss examinations on traffic
laws, and met requirements regarding military service and
nationality. :
5. Tho initiative for the training of engineers and technicians
in isighlvay work rests with tho educational institutions. Tho
respectiVe proles:dont-1 organizations license civil enginoors.
Laws relating to highway planning and construction often
stipulate that only licensed civil engineers may hold certain
positiens contained in doi.artmental une State tables of
organfa ation.
6. Tho lack of international highways connecting nrazil and her
neighbors obviatos the hocessity for international 4::reemonts
concerningletor transport.
7. 14,tional Highway Departaont inspectors, working from inspection
posts on tho 2bdoral highways, preparo traffic and accident
reports. StItistics on cargo crossing St/to lines are furnished
to the ilinistry of .griculturo. :Data co: piled on tho numbor
of passengers land cargo. moved, however, is only partially and
helat4e1y published. Individual accident reports state whether
fatalities nave occurred, and give the degroo of vehicle &maga
and nature of personal injuries. ?
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?
A.E9ENTIN - HIGHWAY TRANSPORTATION
A. EQUITLE
1. The salient feature of present Argentine policy with re-
spect to highway transportation to the trend toward
nationalization of all such services which are considered
to be of national interest. Thus Argentina will take over
the trucking subsidiaries of foreign-owned railroads con-
currently with the pending acquisition of these railroads.
Nationalization of the highway transport systems of
Buenos Aires and Rosario will set the pattern for future
acquisition of other important highway transportation
systems.
Argentine highways were long considered primarily as ad- H
juncts to the railroads. Until 1 January, 1947, Argentine
law required the railroads to subscribe 3% of their gross
income for road building. Originally such roads were to
have fanned out from the railroads to form feeder systemst
but beginning in 1932 the government applied certain funds
to the-construction of highways paralleling the railroads.
This produced competition between highway transportation
and railroads, forcing the latter in sat defense to
deVelbp their own trucking lines. Large suns are now in-
cluded in the FivesTear Plan for deielopment of the Federal
Highway System.
City passenger transportation is a government monopoly.
The present relative, importance of highways is evidenced
by the fact that the share of total cargo handled by
trucks in Argentina has risen from 5% (during World War
I/) to 15%, while the railway share has dropped from 95%
to 85%. Between 1940 and 1944 the Federal Highway. System
increased from 30,773 to 38,584 miles. .
2. The highways and transport on them are administered by
the Ministry of Public Works, but independently of other
forms of inland transport. There is some coordination .
within the National Economic Council, which is accomplished
by a National Coordinator for Highway's outside Buenos Aires
and a Municipal Coordinator for transport within the
Metropolitan Area, where city passenger transportation is
a Government monopoly.
The.location of strategic highways has been primarily
determined in the past by economic rather than military
conditions. Sore roads, however, were undoubtedly con-
structed to serve military needs. This applies especially
to temporary roads and trails northward to the underside of
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ARGENTINA b .HIGHWAY TRANSPORTATION (A-, CONT0D)
Bolivia and roads toimilitary outposts. Among planned
roads is one in the direction of the Paraguayan frontiert
4. Highways are constructed from public funds by the Federal
government in cooperation with the respedtive provinces
and territories. There are no subeidies to private car-
pantos, although the nationalized transport systems are
operated at Government cost. The Five-Year Plan includes
? large appropriations for highways. ,
5. Highway policy has been based essentially on economic
? requirements. The economic core of the country has its
center in the Buenos Aires seaport area and embraces the
great pampas regions and surrounding country southward to
the Rio Negro, westwards to the Andean foot hills and
northward to the Parana river. The prime mission of-the
highway network is to expedite the movement of raw materials
to ports and of finished products to the interior. This
function makes the highways an auxiliary to the railroads.
The most important example of influence on highway trans-
portation policy from vested interests was furnished by
the attempt of the railroads to have legislation enacted
curbing the increasing activity of the highway 'carriers.
The railroads initially proposed legislation requiring
that highway transport be regulated by the National Rail-
ways Board, but such obvious atteppte to stifle corpeti-
tion were bypassed, and the finWdraft of the bill
established centralized coordination for all public trans-
port.
ORGANIZATION
1. The control of highways lies in the Ministry of Public
Works, which includes,:. Direcion Nacional de Transportes;
Administracion General de Vialidad; and Corporacion de
Transportes de la Ciudad de Buenos Aires. .
3. The highway agencies in the Ministry of Public Works are
coordinated with agencies handling other forms of trans-
portation at the level of the National Economic Council.
4. Two major laws were passed in 1936-7 providing for the
coordination-of transportation. The first of these
measures was designed to ease the acute corpetition be-'
tween tramways, subways, suburban railways, taxicabs
omnibusses? and small busses, (the popular "collectivos")
in the Buenos Aires Area. Provision was rade for the
establishment of the Office of the Coordinator of Muni-
cipal Transportation. .This was followed by a second
measure creating the Office of National Coordinator of
Transportation with control over long distance trrinsporta-
tion "in or between the National Territories, or between
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ARGENTINA HIGHWAY TRAESPORTATION (134,C0NTID)
these and the Provinces, or between these and the Federal
Capital.? ?
5. The highway agencies are considered to be operating
inefficiently, due to delays in obtaining new equipment and
placing it in operation. There has been considerable. public
criticism of this inefficiency, particulfirly with respect to
the operation of the nationalized systems for city passenger
transportation and Cargo hauling, as well as the private,
highway passenger transportation companies.
C. ADZNISTRATION
?
?
1. Motor transport lines for passengers are established under
procedures set forth in la* No. 12346 (1937). Applications
are channelled from the immediate Municipal Authorities '
through the Provincial Officials for final processing by the
National Commission for the Coordination of Transport. Cargo
transport lines do not need franchises, but must comply with
licensing requirements.
The National Commission for the Coordination of Transport
controls the approval of highway and construction contracts.
The first extensive plan for Federal and Provincial highways.
envisaged in 1933 an expecitture of $385,000.000 for the
construction of new roads during a 15-year program. .Under
the recent Five-Year Plan, (1946) the annual expenditure for
highways will be approximateiy $28,500,000.
2. Passenger rates and other tariffs are based on percentages
of 1936 rates and codes. Adjustments are authorized for
increased operating costs. The National Highway Transporta-
tion Commission is competent for areas outside the Buenos
Aires System. For the Metropolitan region the Coordinator
of Municipal Transportation is the highest authority.
3. It has been considered in the public interest to nationalize
the passenger transport service in Buenos Aires and the
river Port of Rosario, and thus restrict competition between
carriers.
Small passenger operator competition is restricted bYlmeats
of franchises restricting routes to specified companies.
Cargo carriers are. not subject to similar restriCtions, and
competition is not limited through Government action.
4. Vehicles must meet specified operating standards set by the
police departments and demanded by insurance companies.
Additional safety rules are established by the operating
companies themselves, to forestall civil damage suits. It
is reported that safety standards for passenger transporta-
tion are unsatisfactory. in regard to fire hazard's.
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ARGEhTIa HIGHWAY TRALSPORTATICii (C-5)
5. Kationdlized transport systems maintain classes for drivers
and .,;uides. Driver licenses are subject to exaninatien in
both theory and practice. Applicants are required to pass a
physical examination. "
7. The Rizhway carriers are subject to the same inspections
as the operators of other overland transportation. The .
reports are used by the tax authorities as well as for
purposes of studyinz working' conditions. and administerinz
social security. They are submitted to the National
Director of Highway Transportation and the Coordinator of
Municipal Transportation. Reports on labor matters are
forwarded to the Secretary of Labor and Welfare, The
National Director of Highway Transportation also receives'
statistics on passengers and freight.
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PERU \ 111Glitla TRAIMP3RTAT1ON
A. POLICIES
1, Highway transportation policy in Peru is determined by the
state. The PeruVian ?Government considers adequate highways'
to be the most essential component of its transportation
system. This is because the flexibility of highways 'adapt
them to the extremely rough terrain in Peru. The Govern-
ment accordingly intends to premote\the construction of
, new through roads t6 reduce the i escalation of its remote
areas.
2. There is little integration between the .Ministries and
' other governmental authorities concerned with highways
and other Dorms of transportation.
3. Strategic and military consideratiens do not appear to
, influence appreciably Peruvian highway transportation
policy. '
1. There is no government subsidization of motor transport
operating units. All interUrban highways, on the other
hand, are constructed and maintained at state expense.
There has been a parked increase in national road building
expenditvres in recent years. Peruvian policy has in-
creasingly subordinated railroad construction to highway
expansion because of the adaptability of-highways to the
country's difficult terrain.
(
5. The Government's highway transportation policy is not
influenced by Vested interests.
B. ORGANIZATION
1, The Ministry,of Development and Public i;orks is responsible
for highway' and railroad matters. Under that agency is the
Bureau of ,Highways and Rail.roadt? with separate 'Highway and
Railroad Sections,
2. The Bureau of Highways and Railroads is headed by a biroctor
General directly responsible to the Kinittry of Jevelopment
and Public Vierks. A sub-director is in charge of the High-
way section, which has departments for administration, opera-
tions and engineering.
3. There is no dLrect coordination of transportation policy
between the Ministry of Development and .Public torks, .the
Ainietry of Aeronautics, and. the Ministry of the Navy. There
is no appreciable eVerlapping @r conflict between the national
agencies and the political sub-divisions in transportation
matters. .
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PLED - HIGHWAY TRANSPORTATIJN (B-4)
4, The present governmental agencies are considered adequate
and there are no known plans for reorganisation or new
agencies.
6, The highway-agencies are operated in the public interest9
and are almost free of political interference. Ehtle the
engineering service's are good, there is need, for more
mechanized construction.
C. ADLIVISTR&TION
1. The planning of now highways is the responsibility of the
Department of Studies and Planning of the Bureau 'of High-
ways aad Railroads. New locations-are approved by the
Minister after consultation with other branches of the
Ministry of Development and Public F.orks. New roads are
constructed according to a comprehensive national plan,
Private motor transport lines for passehgers and cargo
require a licence from the Bureau of Transit in the
Ministry of Government and Police.
2. There is no official rate structure for cargo service on
highways. While passenger bus rates are submitted by
operators to the Bureau of Transit for approval. An prac-
tice competition dictates fares.
.75. In the absence of through coastal railroads9 cabotage
operations of the state-owned Peru Steamship Corporation
offer the only competition to letor transport along 2800
miles of coast served by the Pen-American highway. 3cean
shiesent is preferred for long distances and for heavy
cargoes while motor freight is largely restricted to
shorter hauls of lighter goods. Competition among indivie
dual meter transport.operatorsie not particularly 'desired
by the Government. However, lenient licensing procedures
.and the absence of remission charges for new' operators
facilitate the organization of new lines.
4. The Traffic Department of the Ministry of Government and
Police establishes and enforces regulations Governing
motor transportation. Aside from traffic reGulations.
hoeever. the State imposes no controls governing the safety
and inspection of equipment and personnel using the high-
.ways. There are, on the other hand, periodic inspections
of urban vehicles. eiGhwey accident investigations camp
under the respective political sub-divisions. of the country,
5. There are no Governmentefestered courses for training high-
way technicians other than those offered by the. National.
School of LnGineeritg. Trainihg procedures at this school
are determined by the Ministry, of Education. The drivers of
all vehicles must have licences issued under regulations
established.by the Bureau of Transit.
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PERU - IIIGJUAY TRILESPORT4T ION (G-6)
6. The Peruvian Government it Committed by treaty with
Bolivia to protect traffic through Peruvian territory ?
to the new safe' port of Mates-di on the Pacific. Peru
does not participate in any international highway
rate conferences.
7. Motor transport companies are not Squired to submit
operational data or reports on traffic, rstes, and -
accidents.
3
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C111111. TRaltSPORTATI011
A. POLICIES
1. Iblicy governing the development and use of hightuys in China
in determined by the state. The major objectives of Chinese
highway policy are; (a) restoration of highways Which have
been damaged or destroyed; and (5) modernization of road sUr-
faces wherever peaceful conditions and limited resources per-
mit. In practice, however, little beyond naintenance can now
be attempted.
2. Theoretically, a completely coordinated transportation system
wad established by the delogationto the Uinistry of Communica-
tions of responsibility for ell media of transportation. Actu-
ally, however, highwuy policies uro determined and administered
? relatively independent of those for other forms or transports- -.
tion.
3. Strategic and military considerations now dominate highway
policy in the north and northeast. Been in south and west China
the government makes an effort to hoop the roads open Wherever
? possible ferias? in.military eventualities.
4. Mile gpvernment initiative is a prerequisite to the develop-
ment of provincial highways, as roll ae a system at national .
highways, the central government is eeriously handicapped by
meager resources id foreign exchange, primitive equiphrnt And ?
innufficdont technical personnel. Generalissine Chiang Rai-
sheltie ton-year plan, nevertheless, envisions a well-coordinated
syntet of big,hwaye connecting theimportent centers, particular-.
1y those not served by rails, in Central, gest and South China.
This comprehensive and ambitious program, patently unrealietio,
calls for 253,000 kilometers of higkaluys,withan eventual goal
of 1,600,000 kilometers. Chinese authorities also have ambitious
pions for developing highway transport. They intend to organize
a government monopoly of commercial bus and truck cervices on
main highways, granting franchises to private companies only
for operations on secondary roads. The contemplated government-
operated services, Purthernore, would control distributing
points and central fueling stations, thus excluding commercial
? gasoline companies and tire doulore from a substantial portion
of the retail market.'
6. Mitch of China's economic life is controlled by powerful family
groups, some of which are close to the gaiornment, and local
political factions. Those vested interests exert great pressure
on all phases of government policy affecting their interests.
Since no substantial extension of the highway network or develop-
. tent of motor transport could occur without affecting these
private interests in many ways, their influence in the gevern-
ment is used to aoccolerlito?or retard highway projects in adoord.
;moo with their individual interests. The Chinese motor trans-
port industry, on the other hand, is too young and unorganized
to yield any ',ameliorable influence on the central government.
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IgWk. e
omiu,
rnau ,r Itte.11SPOirit:TIO:
?.-0 COUT'DI
Historical conditions influence highway transport policy
chiefly in the sense that Cldnoce hictory has ostablishoi a
tradition of primitivo overland transport and thus orca.ted
an inertia against progress. Indifforonco, and, indeed, '
actual resistance to change has been hietorloally a w..jor
teeter returding the developeont or highway transport in
Chino. Ccograpeio conditions have cOntrIbutod to thin
stagnation by interposing my* formidable obstacilos, such
us difficult terrain unmanageable streams and poor natural
distribution of constructionmotorials. Political conditions
operate both as an incentive end a complicating factor in
highway transport development. Lhile the improvemont,of
communications with outlyine subdivisions would be of grout
political advantage to the Nationalint Government. no protrans
of national scope can be instituted without considering the A
views of local political authoritiea. If the ourront rAlitary
emorgoney is resolved, highauy transportution will develop
easontiallyos a compromise of economic factors: it will be
u long time before the limited capabilities of the Chinese
acorn:4v can do more than satisfy a fraction of China's basic
need for adequate ovorland transport.
P URGAili Zhn 0
1. The Ministry of Or>:_mimioutioru3 is the focus of Chinese Govorn-
ment authority over all forms of transport, including highways,
Tho Railway and ltighway.Departrant of tho Ministry includes
the national Highway Administration.
2. Tho Railway and 111.ghtvay D3...b.rtnerrt of the Ministry of COIraMi06-
tions is 'charged, according to irtiole VII of its orgbnio law,
with the ?following responsibilities portbining to highwa,ys:
(a) planning and construction;
(13) operations on highways, including subsidiary
activities;
(c) enr,insoring and mechanical questions; and,
(d) supervision of highways.
, In addition .to the above 3:Unctions, the national Higartay Lcirain-
istrution controls provincial and other highway administrations
and variolds regional motor transport administrations, including
? the Metropolitan (Shanghai, Peiping, tranloati, ate.) highway de-
partments.
3. Sore coordination of highway matters with other forms of .tuns-
partition evolves from consultations batmen heads of the re-
spective Departments and their subordinates in the: Ministry.
Over-all policy planning within the Ministry is supervised .
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Chia - ILIGIG1/.Y l'ItLIISIMULTION (B-3 CONT'D)
by the Minister of Cormamications and his two Vico-Ministers.
Tho highest policy and planning level for all media of trans-
port, &mover, is the Executive Yuan.
4. The administration of highways in Chine has been under various
organizations since the formation of the Republic: From 1927
until 1941 motters relating to highway administration and trans-
port wore handled by the Bureau of Highways and the Motional
Highway Transport /Administration in .ths Ministry of Ccimmunica.
tions. In July 1941, both of tithe agencies were tronsferred
to the Transport Control Burcou under the National Military
Council. The noed for more efficient highways and for improved ?
coordination with the other overland forma of transportation
led the goVernment to place the adminintration of highwws
uguin under the Ministry of Cemmunicutions at tho end of torld
tar II.
5. It is undoubtedly the desire of the Minister of Coirraunioutions
to direct the Ministry's operations for the public good. The
factors preventing efficiency are largely beyond his control.
. They include vast equipment shortages, commondoering of facili-
ties by the military, and tae interruptions and destruotion
of highway facilities.inoident to the current civil war.
C. ADMINISTRATION
1. Plans ler new highways originate in the Railway end Highway
Deportment of the Ministry. After discussion with various
officials within and mithout the Ministry, they are submitted
to the Executive Yuan for final decision. Mile the construc-
tion of now highways is the responsibility of the DInistry of
Communications, the Ministry's capabilities are frequently
nullified by military commanders, who can demand that the
Ministry's technical and other trained personnel be diverted
to development of road facilities required by the National
'Defense Minister in the prosecution of the civil war.
2. Motor transport rates are proposed by the administrations or
companies operating on the highways. After consideration by
the Ministry of Communications,' they aro passed to the Execu-
tive Yuan for final approval. The Yuam is loath to grunt in-
creases now because of the inflationary tendencies caused by
higher rates. Pleas of the Minister of Communications, asking
for discretionary authority to grunt limited rata increases,
have se far been deeded. All increases granted to dote have
boon so low as to continue to lag behind price raises. This
seems to be Chinese policy.
3 ..
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0111.1a_ - RIMS
30 It awn hardly be said that compotition in motor transport
Is fostered in China. Motor transport to so undeveloped
thut Compotition is an academic issue. A few privately:tanned
highway transportation companies have been granted franchises
over secondary routos but competition does not concern than
as much as high operating Canto and inadequate demand for the
services ol'forod. Competition oan1 if desired, be effectively
controlled by the requirement that 'motor transport sorvities
offered met be approvod by tie Ltnistry of Coamunications
prior to initiation and by extensive eubsidies uhich the
?governtont currently pays to its onn highway companies.
Detailed .regul: tions taro in ?Moot govorning motor vehicle
operation and inspection. investigatian of aeoidonts, penalties
for violating traffic regulations, and the use of highesys.
Tho final authority on regulations pertaining to highway use
rests with the ibteoutive Yuan. The extent to which the
Ministry of Comunioatit..ns promulgates highway regulations
may be judged from the results or the National highway Traffics
Commission.e4.nforonce in 1937, which presented full :tutu-
ton ibr adoption by the National Goveramont covering the
following :aessuros:
4.
1: Regulations,l'or the Ikutagement of Traffio.on Hientays
2. Regulations Governing Pena/tics for Violation of
Traffic Regulations \
13. Regulations for lacyclos Traveling on the Public High-
ways and Uniform Rate of Taxation
4. Regulations for Uniform Taxation of ;hotoroyeles
3. Regulations of 0rivers of Public Buses or Conlercial
Automobiles in different Cities and Provinces
6. Regulations Prohibiting Private 4-utomobiles from
doing Commercial Puniness on highways
7. Regulations for the Joint Transportation Procedure
Regu.lutions Governizt Uniform Paymont of Wages to
? Drivers on the Higinays
I 9. Regulations Governing, the Compensation for automo-
bile accidonts on the Hightays
? 10. Regulations for Sovir*;s of Highway Staffs and Officers
11. Transportation of Motor Freight on China Highways
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Malta 111G1Fla TitaLtPeRTaTION (G-6)
The China? Government has fostered the training of highany
arsi motor vehicle engineers and technicians. ?ha treinixig
or 1,200 Chinese in US industry end tmiversities included
nowt spcoislitinr, in hiGhour denim othor features of
highwa,y transportation. ,Chiunc Itui-ohek's tem-vett proctors
orals for thousand? of engineer graduates and technicians
flooded to carry out the ambitious kublic works progrui out-
land in Ms book,"Ghinuis peat/rye. 4.11 higlay engineers and
all mtor vehicle operators, including trucks and buses, ore
lieensed by the government.
Ga ma lack of through highways suitable fa =tor truf act ob-
viates the need for international agreeraonto on motor trans-
portation. '
7. Both publicly and privately.crmed oporaton on the hirsickys
cubadt reports on operations and accauents, flo vary detailed
highmy safety mot.sures, however aro reported to be enforced
rather loosely. he various regionul, provincial and locul
? highmy .adrailaistrt.tione submit annual reports to the Railway
taxi Higher/4 Depart-snot. Passenger and freight statistica for
? various provinces have boon publiohed.
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RESTRir
? Cue ct ionnaire on
. RAIL, HIGHWAY AND INLAND 7.:ATEMIY TRANSPORTATION
,
? ?
. To bd. ug , f,.n conjunction with this study
e ? .
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OUESTIONIAIRE ON RAIL,' HIGIT6AY AND INLAND tATERWAY TRANSPORTATION
A* Policies
lo What are the basic policies of the country with regard to rail, highway and
inland watemay transportation? To what degree are policies determined by
the state?
2. Are policies determined and administered independentle for each form of
transportation, or are they integrated and centrally adminietered for all
forms of transport0 including sea and air?
30 To what extent are relit highway and inland waterwae transport Policies
based on strategic and military considerations?
4, .Does the government subsidize these forms of transportation, promote the
development of new types of equipment, and the construction of railroade,
highways and canals?
A
5* To what extant is police influenced by vested interests, historical*
geographic, political and economie conditions?
Bb Organization
10 Whet ere the agencies of the government concerned with these forms of
transport?
2. That are the functions of each of these agencies, and how are they
organized to carry out these Punctione?
3. How are the various agencies related to each other? Are they controlled.,
directed, or coordinated by, any agency or erotic on a higher level? Now are
they related to agencies concerned with shipping and-civil aviation? To
what extent do the various agencies overlap or conflict with each other?
4. ilhat conditions or developments led to the establishment of these ageneies
Er$ they are now 'organized? What circumstances Led to the abandonment or
reorganization of previously existing agencies? Is any consideration being
given to reorganizing existing agencies or creating new ones?
5, Are these aleenoies considered to be operating efficiently in the public
Interest?
C, Administration
lt What procedures-are followed in determining the establishment of new
highways, mdtor transport lines, 'railroad lines knd waterways?
2, ilow are ratc4i'determined and what tzpes of regulations govern the rate-
making processes?
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3. To what extent, and by what .means Ls competition festered or restricted?
4. 4/hat types of rules and regulations govern .the safety and inspection of
equipment and personnel, and the 'investigation of accidents? How are these
regulations established and enforced?
5. Does the government foster or regulate the training of technicians in the
fields of transport? To what extent, and how are technical classes of
personnel licensed to perform their functions?, That types of requirements
must be met to obtain these licenses? How does the government determine
. its procedure with respect to training and licensing? .
60 In cases there these forms of transport extend beyond netienal houndanies0
or connect with neighboring lines, what international agreements and
. arrangements exist concerning:
(a) Exchange of traffic
(b) Exchange Of equipment
(o) Pooling of traffic.. equipment and revenues
(d) Establishment of joint facilities
(e) Fixing rates
(f) Allocating routes
7. For the purpose of .administering policies, enforcing regulations. _granting
financial aid, and assuring the adequacy, 'safety. and efficiency of operationb,
what .typos of periodic. or 'special reports and forms does the government
requi,re .covering:
(a) Traffic
(b) Rates.
(c) Expenses, revenues and investment
(d) Qualifications of technical and key personnel
(e). IntiOections
(f) Accidents
(g) Others
To what agencies are the reports submitted? How are they pi-di:et:Sod, and
,what uses are made Of them?'
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