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Aviation History
1944
1944 - 2015.PDF
SEPTEMBER 28TH, 1944 FLIGHT International Aviation US. Secretary of State, Cor dell Hull, Comments on Bailey Bills SENATOR JOSIAH W. BAILEY, of North Carolina, who is a Democrat, has submitted to Mr. Cordell Hull, U.S. Secretary of State, two Bills dealing with the subject of international aviation. One, No. 1949, has the snappy title: "A Bill to Create an Independent Civil Aeronautics Authority and an Independent Air Safety Board, to Promote the Development and Safety and to Provide for the Regulation of Civil Aeronautics and to Promote World Leadership by the United States in Avia tion." The other, No. 1950, is entitled: "A Bill to Create the Ail-American Flag Linet Incorporated, and to Assure the United States World • Leadership in the Field of Air Transportation." Bold objects, franfcly. stated. Mr. Cordell Hull, in his reply, deals with many aspects nj[ the two Bills (they replace between them an earlier mUl, Senate 1790) which are purely of domestic American lH^rest, but some of his comments are highly interesting and significant. On the subject of an All-American Flag Line the Secretary of State says: — "It is noted that one of the main purposes of the bill is to establish an All-American Flag Line, Incorporated, which pre sumably would become the single or at least the dominant , instrument in the field of United States international air trans port. Reasons for Monopoly '' The Department considers that the question of whether our international air services shall be carried on by a single company or by several companies is primarily a domestic matter. At the same time, a number of considerations relating to that question may be of interest, and the Department accordingly feels at liberty to offer certain comments. "It is so often assumed that most of the leading nations have adopted in full measure the single company principle, and that this was done because of unsatisfactory experience with other alternatives. As a matter of fact the experience of other countries is so varied that very few definite conclusions can be drawn." The Secretary of State then goes on to point out that some countries adopt the monopoly policy not only for their international but for their domestic services as well. The countries which, before the war, concentrated on one or two companies may, he said, be grouped in three cate gories : Those having a basic political philosophy favour ing State monopoly; those with small geographical homeland areas and distant or widely scattered colonial possessions ; and those whose financial resources did not permit them to support more than one enterprise. * "The United States," Mr. Hull continues, "does not fit "isto any of these groups. On the contrary, our predominant position in world aviation has been achieved through the com petitive system; our country is so large that it offers an ideal laboratory for technical and other improvements, and our foreign operations are not intended primarily to connect our outlying positions; and we are not prevented by limited finances from obtaining the benefits of regulated competition or for monopoly depending on its estimate of the effect of such a decision on the future development of its aviation industry and its air commerce." The experience of other countries, the letter continues, has been that the one '' chosen instrument'' policy led. to a government-owned system, or else to a system so completely government controlled as to have all the quali ties of a government ownership. The regularity of this tendency suggests that determination to accept or reject the "chosen instrument" theory might well turn upon whether if were desired to accept or reject the proba bility of government ownership or government control tantamount to it. TheuLtter continues: — "In respect to the relation of a single instrument to the national defence, it is to be noted that Great Britain has made extremely effective use of the single government-controlled British line; equally, the United States has found it possible to use a number of lines; and that all of the American lines in question have reached a high level of operating efficiency over far-flung world routes." On the subject of the negotiation of agreements Mr. Cordell Hull has a good deal to say. Pan American Air ways in the past were well known for their abilities (notably those of Mr. Juan Trippe) in this direction. The Secretary, of State does not appear to be wholly in favour of such procedure. Here is what he says: — "Section 902 (B) provides that 'The secretary of State may negotiate agreements with foreign governments in the name of the United States for the benefit of All-American Flag Lines, Incorporated.' Section 902 (C) implies that the company itself may negotiate with foreign interests and provides that the Department, when requested, shall make available its services and facilities in furtnerance of such negotiations. Section 902 (D) provides that the Secretary of State shall not negotiate agreements with any foreign government or foreign national for the benefit of any air carrier engaged in foreign air trans portation 'except as herein provided.' Certain considerations as set forth below indicate that these provisions might be undesirable. "At present the Department and the Civil Aeronautics Board share the opinion that negotiations with foreign govern-, •ments concerning aviation rights should be undertaken by the government rather than by individual air carriers, although it is recognised that there may be instances wherein exceptions to this principle should be permitted. The statement is some times made that landing rights can be obtained by an individual company without committing its government, but this argu ment is to a large extent outdated and was valid only so long as the foreign government concerned had no interest in having its carriers fly to U.S. territory. In general, reciprocity is inherent in the acquisition of any foreign landing rights, even if they happen to be requested by an individual company. This is evident by the present tendency among leading nations to recognise that the interest of their national air carriers abroad can best be protected through inter-governmental negotiations. Incidentally,this prevents a foreign government from ' paying off' one company against another. "Pan Am." versus Government '' Another point to be considered is the disparity which some times exists between national policy and the activities of indi vidual companies. Pan American Airways System, when it was the single American company in the field of international air transport, usually followed the practice of negotiating with foreign governments as an individual company. With the advent of the war, however, some of the arrangements which the company had made proved to be a deterrent to our war effort and were therefore not in the best interests of this country. While it is assumed that arrangements which would be negotiated by the proposed All-American Flag Line, Incor porated, would conform more closely to our national interest, the freedom delegated by the bill to such a company to under take its own foreign negotiations might still result in a situa tion which would be not wholly compatible with government policy or the public interest. "For the above reasons, it is believed that the Secretary of State should be free to negotiate agreements with foreign governments for the benefit of U.S.- air carriers in general and should not be bound to negotiate for one carrier only; and that there should be no legislative mandate which would place the department's facilities at the sole command of a single company without allowing any discretion to the Secretary of State. '' Section 902 (E) provides that foreign agreements described therein are not to be entered into except by Treaty. Section 902 (E) as now drafted would not only make it difficult for this government to participate in certain informal arrangements permissible under the law, and desirable for the development and smooth function of international air navigation, but also would deprive the executive branch of the government of the exercise of reasonable discretion in the conduct of foreign affairs. The Department does not desire to take out of the treaty-making procedure matters which are properly subject there. However, it is necessary that this government should be able in all appropriate cases to participate in international arrangements for the regulation of technical and operational aspects of international aviation without the conclusion of a Treaty." ••
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