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Eno Transportation Weekly

50 Years Ago Today: House of Representatives Debates, Amends, Passes Department of Transportation Act

August 30, 2016

Fifty years ago today, the U.S. House of Representatives amended and passed landmark legislation creating a new Cabinet-level Department of Transportation.

Eno’s Documentary History of the Creation of the U.S. Department of Transportation charts the history (and antecedents) of the Johnson Administration’s plan to combine most federal road, aviation, railroad and maritime agencies and authorities into one department. After transmitting its draft bill to Congress on March 2, 1966, the White House watched as the House Committee on Government Operations (which has jurisdiction over the creation of new federal departments) analyzed the proposal and then held hearings in April, May and June.

After the hearings, the White House did its best to answer the questions raised by the House committee members, but it had become clear that the proposal faced two major problems and a host of minor issues. Both of the major issues were instances of where an “iron triangle” – an entrenched combination of private sector interest groups, a dedicated federal bureaucracy, and Congressional oversight subcommittees or committees supportive of the programs – would be upended by the proposed DOT legislation.

First was section 7 of the proposed legislation, which in its initial form would have given the new Secretary of Transportation the authority to develop and revise “standards and criteria…for the formulation and economic evaluation of all proposals for the investment of Federal funds in transportation facilities or equipment” – even when the agency carrying out the project was not part of the new DOT. This gave particular concern to the Army Corps of Engineers, the dredging and shipping interests that depended on Corps river and harbor projects, and the Appropriations Committees of Congress.

The other major problem was that the original bill proposed to transfer federal maritime programs to the new DOT. It is hard to remember today, but during World War II the federal government appropriated a tremendous amount of money for shipbuilding and operating subsidies, and these policies took decades to trail off. In fiscal 1966, the Maritime Administration had a budget of $336 million. To put that in perspective, the Coast Guard’s budget for the same year was only $473 million and the Federal Aviation Agency $867 million. The operating differential subsidies in particular were of key importance to maritime labor unions, and the Maritime Administration that gave out those subsidies was overseen by its own House Merchant Marine and Fisheries Committee (dominated by port city and pro-union legislators).

A Government Operations subcommittee held a markup session on June 22 that resulted in several amendments (summarized here and later incorporated into the text of a new, “clean” version of the bill). The subcommittee markup did not touch the maritime issue, but it did make several other restrictions on the Secretary’s powers under section 7. The subcommittee exempted all federal grant-in-aid programs (highways, airports) from the Secretary’s criteria and it required the Secretary to get the approval of the Water Resources Council for any Corps-related standards. It also specified that the Corps would keep its practice of submitting Chief’s Reports directly to Congress.

A week later, on June 29, the full Government Operations Committee amended and approved the bill. The few amendments adopted in committee included one to give a blanket exemption from section 7 to “water resource projects.” (In a memo to President Johnson just after the markup on June 29, domestic policy aide Joseph Califano, Jr. wrote that “we lost a good part of Section 7 (which is no problem because we will probably lose the rest of it in the Senate).” But still Government Operations made no changes to the maritime portion of the bill.

Other amendments adopted in committee narrowed the focus of the bill slightly (to leave authority to regulate the movement of railroad freight cars, or “car service,” with the Interstate Commerce Commission) and established four new modal administrators (Aviation, Maritime, Railroad and Highway) within DOT who would report directly to the Secretary. (Under the Administration’s original bill, the heads of components like the Bureau of Public Roads or the Federal Aviation Agency might have to report to the Secretary through assistant secretaries or the Under Secretary.)

Meanwhile, pro-maritime forces were planning on taking their argument directly to the House. In a June 21 memo to the President, his House liaison Henry Wilson warned Johnson that earlier in the day, the House Merchant and Marine Committee had voted, 11 to 6, to approve legislation (H.R. 11696, 89th Congress) to make the Maritime Administration an independent agency instead of a part of a DOT. (It was, at the time, housed in the Commerce Department.)

It took almost a month for the House Rules Committee to grant a rule allowing the DOT bill to come to the House floor. (The Rules Committee was more independent of party leadership in those days.) That happened on July 27, when Rules granted a special rule providing for four hours of general debate, after which an open and unlimited amendment process could take place. But the rule did not go immediately to the House floor.

Instead, the Rules Committee also, on August 10, voted to issue a special rule allowing the bill creating an independent MARAD to come to the floor. Bureau of the Budget Director Charles Schultze wrote a panicky memo to President Johnson later that day:

A separate Maritime Administration, or one which is virtually independent of the Secretary of Transportation, would seriously weaken the new Department. Moreover, it would strengthen those in the Senate who want a virtually independent FAA. Altogether this could practically gut the new Department.

Schultze recommended that Johnson talk to House Majority Whip Hale Boggs (D-LA), Merchant Marine chairman Edward Garmatz (D-MD), and William S. Mailliard (R-CA), the ringleaders of the effort, to make sure they knew that Johnson knew that while their intent might be to get a bigger budget and higher subsidies out of the effort, “whether the Maritime Administration is separate or within the new Department, you still control its budget requests; you are not about to reward a slap in the face with an expanded maritime program and a larger budget…”

While the White House dealt with Congress, the President also assigned Under Secretary of Labor James Reynolds to sit down with maritime labor leaders. Reynolds called LBJ on August 23 to brief him on the progress of the talks (listen to the recording here). Reynolds said that the maritime union leaders would be willing to support the DOT bill if they could work out language to have a MARAD within DOT. The concessions to gain their support were that three commissioners would determine MARAD subsidy levels and LBJ would have to make a public statement on maritime policy.

Talks continued with labor on a possible amendment (and Califano sent Speaker McCormack possible amendment language), while the House on August 24 debated and passed the rule allowing the DOT bill to move forward. (As was often the case in those days, the rule passed by voice vote.) General debate on the bill began, but since the talks with labor on the maritime issue were going to take several days, the debate on amendments was pushed back to the following week.

Over August 24 and 25, President Johnson spoke with AFL-CIO head George Meany on the telephone no less than four times regarding the DOT/maritime issue (recording #1 recording #2 recording #3 recording #4). Meany had jumped into the issue with both feet – Labor Secretary Willard Wirtz sent the President a memo on what must have been around August 24-25 saying that Meany had “sent last night to the Speaker and every member of the House a strongly worded telegram flatly opposing inclusion of the Maritime Administration in the Department of Transportation” but that the AFL-CIO position could be reversed if LBJ publicly backed the maritime policies contained in a recent advisory committee report. (LBJ takes Meany to task on the telegram in recording #2, saying it had “murdered us”.)

LBJ also told Meany that he could sit down and discuss in advance who could be named Secretary of Transportation. In his new book, Alan Boyd, who was Under Secretary of Commerce for Transportation at the time, says that it was his 1965 crusade to eliminate maritime subsidies that caused the maritime unions to be so opposed to the DOT bill – Boyd was a likely candidate to be the first Secretary, and his hostility to subsidies had the unions on edge.

Over the weekend, Johnson talked to Senate Commerce Committee chairman Warren “Maggie” Magnuson (D-WA) (recording here), who had just talked to Seafarers Union chief Paul Hall. Hall insisted that a commission-led MARAD within DOT have final say on subsidy decisions that the Secretary could not overrule. Johnson told Magnuson, “I don’t want to make this Secretary a eunuch or an impotent fellow where he gets to war all the time with the Administrator or the Board, because if we did, all I’d do is fire the Administrator and the Board when they didn’t agree with the Secretary.”

The House was scheduled to bring the DOT bill back up on Monday, August 29. That morning, the White House legislative team met with House Democratic leaders. At 10:35 a.m., Postmaster General Larry O’Brien called the President to brief him on the meeting (recording here). (This requires explanation – O’Brien had been head of White House legislative affairs under both Kennedy and Johnson. Johnson had recently named him Postmaster General, but still expected him to function as head liaison to the Hill, so the House and Senate liaison teams still reported to O’Brien during this time.)

O’Brien said that the meeting with the Speaker, Majority Leader and others had been a disaster – Merchant Marine chairman Garmatz “won’t do a goddamn thing, he walked out of the meeting early, I think he’s already in bed with these guys – Hall completely..the meeting just was not at all fruitful.”

LBJ summed up the “net” of the situation: “the net is, they won’t agree to anything else, the net is, you’ll drop maritime (from DOT), the net is, they’ll try to drop aviation and Coast Guard and so forth, the net is, they’ll probably have enough pressure in the Senate with the sensitive labor boys not to bring [the DOT bill] up at all.” O’Brien agreed, saying that the Senate committee was not going to act until they saw what the House did. Johnson said “there’s nothing we can do about it except just take a whipping, is there?”

Johnson also said that he had anticipated this kind of outcome since before he transmitted his DOT proposal to Congress earlier that year. But he and O’Brien were clear that a bill with a MARAD within DOT, even if the Secretary could not overrule MARAD decisions, was preferable to a completely independent MARAD. Also on the phone call was Califano, who said that he anticipated that amendments to remove the Coast Guard and the FAA from DOT would be offered.

The House finished general debate on the DOT bill later that day. Then, on Tuesday, August 30, the amendment process began. First, the amendments recommended by the Government Operations Committee from the June 29 markup were adopted by voice vote. Then, Rep. John Erlenborn (R-IL) stood and offered an amendment to strike the entirety of section 7 (allowing the Secretary to set all cost-benefit analysis standards for transportation project evaluation) from the bill.

The majority bill manager, Rep. Chet Holifield (D-CA) acquiesced, saying while section 7 was well-intentioned and was good policy, “I understand that a large number of amendments will be proposed if section 7 remains. It seems preferable rather than take the time of the House to debate 10 or 15 amendments on a section of the bill which has already been narrowed down to eliminate the section entirely.” Erlenborn’s amendment passed by voice vote. The Corps of Engineers and its allies were victorious (though the House did later reject a proposal to leave the regulation of bridges over navigable waters with the Corps instead of giving it to DOT).

Later on, Garmatz offered his amendment to strike all references to maritime from the bill and leave MARAD within the Commerce Department for the time being. Garmatz said:

As far as maritime affairs are concerned, this bill does nothing more than satisfy someone’s urge for bureaucratic tidiness.

It does not taken into account the fact that there is little that the Maritime Administration does or can do that bears much relationship to what the overall department and its segments concerned with various aspects of domestic transportation would be doing.

Nor does it calm the fears of those who believe that by transferring maritime functions to this vast new melting pot of transportation the agency charged with promoting American shipping would be overwhelmed by far larger interests.

Debate on the amendment was dominated by maritime interests. Holifield did say “There is no doubt in anyone’s mind that this is a step forward – a long step forward – to give [maritime] the attention that it needs of a Cabinet Secretary who is concerned only with the improvement of transportation.

After debate, the Garmatz amendment striking MARAD from the bill was agreed to by a non-record vote of 190 to 63 (and later confirmed in a roll call vote of 261 to 117, with 3 voting “present”).

But White House fears that excluding MARAD from DOT would lead to other modes being dropped proved unfounded. An amendment by Rep. Alton Leonard (D-NC) to keep the Coast Guard out of DOT failed by a non-record vote of 73 to 107. And a third-term Congressman from Kansas named Bob Dole (R) offered an amendment to keep jurisdiction over pipelines with the Interstate Commerce Commission instead of giving them to DOT, which failed by voice vote.

(The House did give the Coast Guard some better treatment. An Erlenborn amendment having the Commandant of the Coast Guard report directly to the Secretary instead of through an Assistant Secretary passed by voice vote, and a Henderson (D-NC) amendment allowing Coasties to serve in any DOT role except Secretary, Under Secretary, or Assistant Secretary for Administration (notwithstanding their quasi-military status) also passed by voice.)

Another issue of inclusion versus exclusion debated in the House was mass transit. As proposed by the President and reported from committee, mass transit functions were left at the new Department of Housing and Urban Development. Holifleld said:

The President was unable to state with certainty at this time what the proper division of labor between the two Departments should be. He has said that after the new Department has been created he will direct the Secretary of Transportation and the Secretary of HUD to study the problem and recommend to him within a year the means and procedures by which the cooperation can best be achieved, not only in principle but in practical effect.

I believe the President has chosen a wise course. Urban mass transit is so intimately tied in with other urban problems that it seems to me that the program should remain with HUD. I do have an open mind, however, based on future developments after the new Department has been put into operation.

That wasn’t good enough for Rep. Florence Dwyer (R-NJ), who proposed an amendment requiring a joint DOT-HUD recommendation on disposition of mass transit be submitted to Congress within one year of enactment. The amendment passed by voice vote.

Another big issue was airport noise. Rep. Benjamin Rosenthal (D-NY) offered an amendment to create an Office of Airport Noise and Abatement within DOT, to which Rep. John Wydler (R-NY) offered an expansion. Wydler’s second-degree amendment was defeated by a non-record vote of 23 to 51 and then the Rosenthal amendment failed by a non-record vote of 36 to 82. And Rep. Ogden Reid (R-NY) offered an amendment requiring the Secretary to measure aircraft noise and formulate and establish regulations to provide for noise control and abatement, which failed by a non-record vote of 18 yeas, 56 nays.

There was also concern with where to place the authority to investigate aviation accidents. Bob Dole offered an amendment to leave the specific authorities for aviation under titles VI and VII of the Federal Aviation Act for safety investigation with the Civil Aeronautics Board (the bill would have vested those powers with the Secretary). Erlenborn offered a second-degree amendment specifically vesting those powers with the new National Transportation Safety Board instead. The Erlenborn second-degree amendment failed by a non-record vote of 62 to 100 and then the underlying Dole amendment failed by voice. (This was later confirmed by the House in a roll call vote of 143 yeas, 238 nays.)

The Public Works Committee was keeping an eye on other legislation that was also moving through Congress. On behalf of that panel, Rep. John Kluczynski (D-IL) offered an amendment that would make the proposed National Highway Safety Agency (the bill establishing it was at that time in a House-Senate conference committee) and the legal authorities conveyed by the pending Federal-Aid Highway Act of 1966 part of the Department, and this amendment also passed by voice.

At the end of the day, the vote was called on final passage of H.R. 15963, and the bill passed by a roll call vote of 336 yeas, 42 nays, with 54 not voting. The stage was then set for Senate consideration of the bill the following month.

 

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