tion of the appointments, without confinement within five definite regions, there would be an improvement.

Senator PITTMAN. Well, how can you do that when appointive powers are human?

Mr. CALDWELL. I have not given extensive thought to the question, Senator. Frankly, I have not regarded the limitation on appointments as one of the more important issues in the present state of affairs.

I would think it was very unfortunate if the zone system were carried any further, or if the communications bill, if passed, applied it to anything besides broadcasting. There is not any real question of geographical distribution in other fields of communication. Much of the radio communication in other fields takes place from either the Atlantic or the Pacific coasts. There are, of course, exceptions like ship stations on the Great Lakes, and other important exceptions.

The CHAIRMAN. In the make-up of the Interstate Commerce Commission I think that the geographical situation has been pretty well recognized without any mandate from Congress. Of course the Senate always has a veto power in the matter of confirmation if anything should happen such as suggested by the Senator from Nevada in the way of concentrating all of the commissioners from one district.

Senator PITTMAN. There have been discussions in Congress as to the appointment of Interstate Commerce Commissioners from certain sections of the country and the contention that certain sections have been favored over others.

The CHAIRMAN. You will recall in several instances that pressure has been brought upon the appointing power to recognize certain zones, and they were recognized.

Senator PITTMAN. Yes.

The CHAIRMAN. I think that is preferable to making it mandatory by law.

Senator BARKLEY. It depends on which section gets it. If we get it, it is.

Mr. CALDWELL. These hearings that I have spoken of, of course, were intended to get rid of stations, and the net result was that very few had been eliminated; no substantial advance along this line had been made. A very hot summer had been spent in Washington without results.

Senator DILL. They did make an advance, did they not, though, in having fewer stations on the air at the same time?

Mr. CALDWELL. That is the result of the next step, which was the reallocation. As the result of advice from these same interests and engineers that I have spoken of, and very arduous work on the part of the commissioners and the Government engineers, an order was adopted on August 30, known as General Order No. 40, in which the entire 90 channels in the broadcast band were classified and had restrictions put on them. Of the 96, 6 for the first time by formal action of any Government body were provided for shared use with Canada, with an appropriate restriction as to power.

Of the total of 90 channels which this country could use, 40 were designated as cleared channels. A cleared channel meant simply that after sundown only one station should be operating on such a channel, and that a station of substantial power. While there was

no low limit placed on the power, the high limit was, in substance, 50,000 watts. On these channels, as I have told you before, there was provision for operation by other stations during the daytime.

On 35 other channels there was a restriction of 1,000 watts, and on some of them as low as 500 watts. On these channels stations were duplicated around the country, 2 or 3 or 4 in simultaneous operation on a channel, sometimes more.

And then there were 6 channels which were devoted to stations of 100 watts or less, in great numbers on each channel, sometimes as high as 50 on a channel, but separated 200 or 300 or 400 miles from each other. That is the type of channel, for example, that the fifth zone could use in great numbers. Right now the first zone it up to its limit on such channels and probably exceeds it from the point of view of ideal results. There could not be any more of them, and they can not be any closer together without causing a lot of trouble. The same number could be multiplied by 9 or 10 in the fifth zone.

Then there were four miscellaneous 5,000-watt channels, which are not of any paritcular importance.

The commission took General Order 40 as a structure and fitted in the 650-odd stations that were still in existence. It issued its first allocation order on about September 8, purely a tentative order, in which the stations were notified as to what assignment the commission was given each of them. Provision was made for application for changes by any stations feeling aggrieved, and the procedure under which they might obtain hearings and relief was specified.

On October 12 that allocation was made final in a certain sense; that is, while it could be changed by hearing, it was to go in effect on November 11. The present licenses were to expire at that time and new licenses were to issue in accordance with the allocation.

The hearings started in tremendous number from the latter part of September on, and the commission is not yet through with hearings which arose out of the new allocation. I do not want to exaggerate the number, but I am under the impression that there have been two or three hundred applications for change in terms of license arising out of either the allocation or some later development.

The CHAIRMAN. In the meantime they are obeying the commission's order and keeping on their allocation?

Mr. CALDWELL. Yes. There are many of them which, through inferior equipment, are not staying on their channels as they should, and they are being cited from time to time before the commission to show cause as to why their licenses should not be revoked. Some stations that have not been properly equipped wander over as far as 5, 6, or even, in one case which I remember, 20 channels away. That station was operating that far away from its assigned channel simply because it had such inferior equipment and negligent operation. That, of course, means interference on all the channels over which it wanders.

The CHAIRMAN. But that was not done by intent?

Mr. CALDWELL. No. It was through negligence and improper equipment. There are cases where you may suspect intent but there was not in that particular case.

Its new allocation led to certain litigation which I shall review in a moment. I simply want to bring the account up to date in another line, that is, in the high frequency bands. I have told you how in

January, 1928, because of the flood of applications, the commission held a general hearing in which all interests were called before it so that it might determine what were the needs and the best use to which the facilities could be put. And some 35 separate types of business were before it with applications.

Then in May, 1928, it had a hearing on applications simply for transoceanic channels, from 6,000 to 23,000 kilocycles, capable of use for communications over long distances, and mostly transoceanic in nature. Decisions were made on a portion of that band in which certain leading communications companies, including the Radio Corporation, the Postal interests, the press interests, and two or three shipping concerns got assignments, and two or three were denied. The denial of two led to appeals which I shall speak of later.

In the fall of 1928, in addition to its broadcasting difficulties, the commission undertook the settling of the continental short-wave band between 1,500 and 6,000 kilocycles. It had many times the applications that it had facilities to distribute. Those hearings have, I believe, totaled two or three hundred in number since the early part of last fall, and have provided very difficult problems which are not yet thoroughly settled. The hearings are not yet over.

Senator DILL. What is the attitude of the commission to the use of these short wave lengths, as to private use and public use?

Mr. CALDWELL. The public utility principle has been recognized, as I stated yesterday. I think the credit is largely due to the chairman of the commission for insistence upon the legal principle that a public utility test should be applied to applicants; that primarily an applicant to get the use of one of these channels should be in a position to use it for the benefit of the public, and therefore under an obligation to serve all comers on equal terms; that a private concern which proposed to use a channel purely in its own business had no standing in comparison with one that proposed to use it for the benefit of the public.

Senator DILL. This new bill introduced by the chairman in effect makes all radio stations common carriers. Have you considered the effect of that on radio? All those "engaged in the transmission of intelligence for hire," the wording of it is.

Mr. CALDWELL. I have. I had planned to take that up separately later if I might, Senator.

Senator DILL. Very well. I will pass that question.

Senator BROOKHART. On that other proposition, is there any power in the law by which the commission can regulate rates and charges for this service?

Mr. CALDWELL. There is not, except a possibility under a peculiar provision of the present law on transoceanic channels. One section of the law gives the commission somewhat the same powers by inference, I think, that are given to the President under the submarine cable act.

Senator GLENN. They do provide, Mr. Caldwell, do they not, that there shall be no discrimination in rates charged?

Mr. CALDWELL. Section 14 listing the causes for revocation provides that on a finding by the Interstate Commerce Commission that there has been discrimination in rates cause for revocation arises.

The commission itself is not given power to pass on issues of that sort. It must accept the findings of other tribunal.

Senator BROOKHART. That is, the power is in the Interstate Commerce Commission to pass on that?

Mr. CALDWELL. That is where the power lies relative to wireless. Wireless is specifically mentioned in the interstate commerce act. Senator. DILL. There is a special provision about political candidates, who must be given equal treatment in the way of rates.

Mr. CALDWELL. It is readily apparent that you have a lot of different types of stations in radio, some of which are communications companies, like telegraph and telephone companies; some are clearly not, like amateurs and experimental stations; and some occupy a peculiar status, such as broadcasting stations. I had planned, however, to analyze that a little later so as not to interrupt the thread of these legal developments.

Senator KEAN. Excuse me for one moment. Do you classify broadcasting stations as a public use, or do you classify them as a private use for gain?

Mr. CALDWELL. I am afriad I could not answer that question yes or no. It certainly is and has been a private use for gain as now operated.

Senator KEAN. Yes.

Mr. CALDWELL. Whether a broadcasting station should be likened to a telegraph or telephone company, or whether it should be likened to the type of public service corporations, such as the furnishing of electricity, gas light, and so forth, where the emphasis is on the receiving end, so to speak, is a question that I wanted to mention later, and I think that there is some basis in the law to raise a very serious doubt on that question.

I should have mentioned that in the fall of 1927, before the commission's first hearing on short waves, there met in Washington a radio congress of practically all the nations in the world, and it resulted in the treaty of 1927. This treaty divided the whole spectrum of radio waves up into different small bands that were to be devoted to particular kinds of service, but did not attempt to allocate to any country any share of these wave lengths. And, as I explained yesterday, it is based somewhat on the theory of squatters' rights, in which the first country to plant its stations on any channels is likely to be ahead of those that come later.

Now I think I have covered and brought up to date the situation in the commission with regard to these different bands and the problems that it has had to meet, chronologically.

Out of the attempt to put stations off the air last summer arose three important cases in Chicago. Two stations that had had their power reduced from 500 watts to 100 watts in September brought suits for injunction to restrain the United States attorney in Chicago, the local radio supervisor and the members of the Federal Radio Commission from enforcing either the penal provisions of the act or what they termed the "order" of the commission. Our motion to dismiss the bill as to the members of the commission was immediately granted, and the suits went on with respect to the other defendants. On the complainant's motion for a temporary restraining order Judge Wilkerson, the same judge who had made the ruling in the Zenith case, rendered a decision upholding the contentions of the Government,

upholding the validity of the act against the claims of property right made, and denying in effect-I do not want to be too technical in describing his decision-denying in effect the right of those particular plaintiffs to question the commission's proceeding. It was, of course, our contention that they should have appealed to the Court of Appeals of the District of Columbia if they wanted to attack the correctness of any decision. That was not squarely passed on, however, in that case. The decision is printed under the title of White v. Federal Radio Commission in the Federal Reporter, 29 Fed., 2d, at page 113.

Senator DILL. In that connection, as I understand it, the United States district courts outside the District of Columbia have no jurisdiction to pass upon questions of fact, or of discretion by the commission?

Mr. CALDWELL. They are constitutional courts and therefore can not perform any functions which are administrative in character. Senator DILL. Yes.

Mr. CALDWELL. For that reason there is a defect in section 16 of the present act which I think ought to be removed. It now provides that appeals may be taken from decisions of revocation by the commission to the district court of the district in which the station is located. I think as that stands it is of doubtful validity.

Senator DILL. Your opinion is that it is not constitutional and that in effect it would not give the relief that is intended? Mr. CALDWELL. That is right.

Senator DILL. The court would refuse to accept the case?

Mr. CALDWELL. Yes. And I think that the object that the Congress had in mind in enacting section 16, which was not to cause any station undue inconvenience, can be accomplished by the policy which the commission is already developing; of holding its hearings at the location of the station if that is requested. Then any appeal from its decision will be handled by lawyers anyway, and does not involve the same amount of inconvenience as would result in requiring the hearing of testimony to take place in Washington. Anyway, think that is better than running a chance on the validity of that provision.

Senator DILL. I may say that it was the unanimous opinion of the conferees of the two Houses when this bill was before them, that the Federal courts could not pass upon the questions that are appealable to the Court of Appeals of the District of Columbia, except that they thought that there was the possibility or probability that they might pass on the revocation questions.

Mr. CALDWELL. Nevertheless the second half of section 16 is worded exactly the same with reference to both the Court of Appeals of the District of Columbia and such district courts with the provision that additional evidence may be heard by either court and both courts by an identical provision given the most ample power to review and revise the decision of the commission. So I am afraid that to that extent it may be some day subject to attack.

Senator DILL. Do you think that there is any way that Congress, without changing the jurisdiction of the courts as a whole, can give the local station the right to go into its local district court?

Mr. CALDWELL. I think that that easily can be done in somewhat the same manner that such a review is provided for in the Federal Trade Commission act. There you go to the circuit court of appeals