Mr. CHENOWETH. Are you including Pan American?

Mr. ELLIS. I just meant intra-Alaska airlines.

Mr. CHENOWETH. Feeder lines. It is not necessary to go into detail. I have been very much interested in your operations here, Senator. I have heard very fine comments on your operations and the service you are rendering, which I am sure is appreciated by the people of southeastern Alaska. I wish you continued success. Mr. ELLIS. Thank you, sir.

Mr. CHENOWETH. I think that is all.

Mr. BARTLETT. Mr. Ellis, what position do you occupy with this airline?

Mr. ELLIS. I am the president.

Mr. BARTLETT. And its name is what?

Mr. ELLIS. Ellis Air Lines.

Mr. BARTLETT. Speaking about these short-term certificates, are the banks sometimes concerned as to the shortness of the certificate in case you desire to make a financing operation for new equipment? Mr. ELLIS. The bank regards an airline with a permanent certificate as a much better risk.

Mr. Bartlett, I didn't intend my testimony to go into the airline situation, although I am glad to do it because we do have our problems. But I wanted to speak just as a senator and reiterate about our No. 1 problem. I don't want to clutter the record with my own problems.

Mr. BARTLETT. Let us get into other phases then.

Mr. CHENOWETH. Will the chairman yield?

Mr. BARTLETT. Yes.

Mr. CHENOWETH. I think perhaps that attitude is based on modesty, Mr. Chairman.

Mr. BARTLETT. I am confident of it.

Is it your opinion that the Alaska Public Works Act and allied programs inaugurated about the same time were designed to build up the civilian economy of the Territory in general? Or were they instituted as a result of the military impact upon the Territory?

Mr. ELLIS. First, I would like to say that the Alaska Public Works Act has probably done more for the Territory than any single piece of legislation I can think of.

Secondly, the prime argument at the time the law was passed was to give Alaska some help particularly in areas affected by the influx of the military. They had a particularly difficult problem in keeping pace with the rapid growth occasioned by the military construction.

Thirdly, the reason was that what helps Alaska helps the Nation. Here is a new country and we must accelerate its growth. And I think that the act has fulfilled its mission in that respect.

Mr. BARTLETT. You are aware, of course, when the first appropriation was made for Alaska public works the Appropriations Committee tacked on a proviso saying that no money could be spent unless a certificate was given by the military command. Wouldn't that indicate to a certain extent that the Appropriations Committee at least though this was pretty much a military program instead of one purely for the general civilian economy of all of Alaska?

Mr. ELLIS? Yes. When I numbered the reasons as I did I meant reason No. 1 was by far the most important, the military impact on our Alaskan economy.

Mr. BARTLETT. Is it true that the Federal appropriation for road building in the Territory by the Alaska Road Commission was pretty much on a maintenance basis until and particularly after World War II?

Mr. ELLIS. Yes; that is true. And Mr. Chenoweth, when he mentioned how well we have been treated in the matter of roads, I would like to state that we had nothing to say as far as I know about where these roads would be or what places they would connect. They were generally the military consideration. The military wanted a road from here to there and we were glad to drive on those roads, but that was always the consideration in the interior area.

Here in southeastern Alaska before the pulp mill came along we couldn't get gravel out toward the end of the roads to make them fairly passable for people to get to town to work. There wasn't enough money for that. Suddenly when the pulp mill came along there seemed to be lots of money. Where it came from I don't know. And we built a fine road, a road perhaps better than we Alaskans would have asked for. We would rather have had twice as much road if it wasn't quite so elegant, but somebody else dictated that. We were not asked.

Mr. BARTLETT. Do you know, Mr. Ellis, if the pulp mill now pays any Territorial tax?

Mr. ELLIS. Yes. They, of course, pay the income tax, and they pay a business license tax of $500 a year. They have an unemployment insurance tax and I don't think any other taxes of any importance.

Mr. BARTLETT. Income tax would be paid only in the event of net income?

Mr. ELLIS. Yes.

Mr. BARTLETT. Is it not true that years ago the Kennecott Copper Corp. took out of Alaska something like $200 million without paying a cent to the Territorial government for the development of the Territory?

Mr. ELLIS. I think that is probably correct. I wouldn't say a cent because once in a while they just might be stuck for $10 or $15 license fee for some activity. But they certainly didn't contribute anything in proportion to the amount of business they did.

Mr. BARTLETT. And is it not true, further, that since then the people of the Territory have desired through their legislature that these businesses make a contribution to the cost of government, not to be excessive because it is realized that industry will not come in if taxes are too high, but to bear their share in the cost of operating the Territorial government?

Mr. ELLIS. I think that industry should share the cost of government. We could ask industry to come up here and grant them moratoriums on taxes for the next 20 years, but because they do come they raise the cost of government, and the people by themselves couldn't support that extra cost. I think they found that out in some of your suburban areas in the States where people have rushed out to suburbs and built a lot of houses and suddenly find out they can't support the road and school systems, the suburban demands. You have got to have industry in the area helping to support the government. Mr. BARTLETT. Thank you.

Mr. CHENOWETH. I would like to make a further observation on the industry situation. It would appear to me, Senator, you are confronted with the alternative of either inviting and encouraging industry to come into Alaska or keeping them out and maintaining your pristine scenic splendor up here without the encroachment of industry. I don't know anything about the Kennecott Copper situation to which my colleague Mr. Bartlett alluded. Would you say since it took $200 million out of the Territory it also left a considerable amount of money up here during that time in cash payrolls? The pulp mill may not be paying as many taxes as they would in the States, but certainly it has a tremendous economic impact on Alaska.

Referring to statehood just for a moment. If you become a State, you are going to be competing with 48 other States, not all but some of them, for some of these pulp mills and other industries, and that is pretty stiff competition. I think you are in a very favored position now. Really I do. That is just my observation.

Mr. BARTLETT. Would you yield there?

Mr. CHENOWETH. Certainly.

Mr. BARTLETT. I want to make it clear that I wasn't urging that higher taxes be imposed upon the pulp industry here. I don't mean that. I want to make the contrast between what is being done now in the way of proper encouragement to industry, with moderate taxes, and not done in years gone by where Kennecott Copper Corp. undoubtedly did leave money behind in the way of payrolls and what not; but didn't give the assistance to the operation of government that industry and business cost wherever you have a governmental

structure.

Mr. CHENOWETH. I did not get any criticism of the pulp operation there, Mr. Bartlett. But I think the tax situation which you enjoy up here is a very favorable one for the development of industry. The fact that three more large industries are now contemplating coming in here indicates that you are offering some advantages which perhaps they can't find elsewhere. I am very happy to see it. I hope you continue to attract these industries.

Mr. BARTLETT. Dr. Taylor?

Mr. TAYLOR. Mr. Chairman, I just have one little observation to make. Yesterday I had the opportunity to read an editorial and a letter that had been published by a certain Fairbanks weekly of high repute, a letter from California-no reflection on Mr. Sisk-a letter from a California newspaper editor had been published, in which the Californian was most critical of many things in Alaska, including the transportation. I think Mr. Ellis' airlines was a butt of a portion of that criticism. After he wrote about the long delays and the bad accommodations he had had during the time of his visit in Alaska, he finally ended up by saying, "Perhaps it didn't make any difference because there wasn't much in Alaska to see anyhow." I don't know what kind of a response the folks in Alaska are going to give the editor from Oakdale, Calif., but I would assure him that if he had been traveling with us for the past 3 weeks he would have seen much in Alaska of great interest and importance. I only wish he could take a trip like ours some time. I would be happy to see what kind of a letter you folks in Alaska send back to the Oakdale, Calif., editor. I think that was a very unjust criticism he made.

I am sure that editor will appear a number of times at luncheon clubs in his community. I know information of that sort does Alaska injustice which is uncalled for.

Mr. SISK. Mr. Chairman, I would like to say that Oakdale is not in my district. I do not share in his statement.

Mr. TAYLOR. I found Oakdale on the map last night before I decided I was going to make this statement. So I was sure it was not

in Mr. Sisk's district.

Mr. BARTLETT. Mr. McFarland?

Mr. MCFARLAND. I have no questions.

Mr. BARTLETT. I will now indulge in the usual warning as to time. Mr. Ellis consumed 7 minutes in his statement. It was 13 minutes to 10 when he concluded. It is now 20 minutes after 10. Mr. Ellis has not been guilty of taking more than his share of the time. Oscar Erickson. Identify yourself, please.

STATEMENT OF OSCAR ERICKSON, ALASKA FISHERMEN'S UNION, KETCHIKAN BRANCH

Mr. ERICKSON. Mr. Chairman, my name is Oscar Erickson, and I represent Alaska Fishermen's Union, Ketchikan Branch.

Mr. BARTLETT. I see you do not have a written statement. Mr. ERICKSON. No, but I can send one to you if you so desire. Mr. BARTLETT. If you care to, you certainly have that privilege. For present purposes, I take it you want to make a verbal statement. Mr. ERICKSON. Yes, and it is going to be short.

Mr. BARTLETT. You may proceed.

Mr. ERICKSON. I would like to talk about the salmon because I think salmon is the backbone of Alaska, always has been, and always will be. I don't care how many pulp mills come to Alaska, the salmon industry will still be the backbone.

I am going to ask you directly that I think we need more money for research because I don't think that we know where the salmon goes after it leaves the stream, after they leave their spawning grounds. I don't think the people know where they go, where their feeding grounds are.

I heard lots of people criticizing the Fish and Wildlife Service. I don't think it is right. I don't think they have enough money to work on. It takes tremendous lots of money to do research work, especially on salmon.

There is an old saying that no one knows the fish's way in the ocean, and I have been around fish since I was 9 or 10 years old.

Another thing I would like to mention is I think we should extend the 3-mile limit. We should extend it from point to point instead of going around the bays like it is today in the United States. I think there is 1 or 2 countries in the world that have over a 38-mile limit, and Norway is one, and some of the South American countries where they are trying to get 200-mile limit.

It appears to me that salmon fishing by the Japanese offshore is not helping anything on our salmon when they leave the spawning streams. Where are they going when they don't come back? Somebody must be maybe catching them before they get to Alaska. That is about all I want to say

Mr. BARTLETT. Thank you very much.

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Judge Chenoweth?

Mr. CHENOWETH. Do you feel, Mr. Erickson, that the Fish and Wildlife Service are making an honest and sincere attempt to solve this fishery problem but have not had enough money for research? Mr. ERICKSON. Absolutely I wouldn't criticize the Fish and Wildlife Service. But how can they do work when they haven't got the money?

Mr. CHENOWETH. We have heard a great deal of criticism of the Fish and Wildlife Service. While I think no Federal agency is exempt from criticism altogether, I don't think it is all justified.

Mr. ERICKSON. I think the Alaska Department of Fisheries are doing a wonderful job, too, but they are in the same fix-they haven't got the money.

Mr. CHENOWETH. I believe at Juneau we heard Mr. McKernan testify they were going to spend more money for research.

Mr. ERICKSON. They got to.

Mr. CHENOWETH. At least that is his recommendation.

Mr. ERICKSON. Yes. We have to build the salmon up again where it was 10 years ago. As many in Alaska know, at that time if they couldn't can 6 million cases of salmon 10 years ago it was a disaster. Today they have canned 24 million.

Mr. CHENOWETH. About a third now of what you used to can? Mr. ERICKSON. Yes.

Mr. CHENOWETH. It is obvious you have a very serious problem in your salmon industry, and I certainly hope the solution can be found.

Mr. ERICKSON. In fact, it has hurt the older native people more than the white people because that is all they know, about fishing, and they want to be independent. They don't want to ask for any charity or any handout. They want to be independent and fishing is the only way they can make a living.

Mr. CHENOWETH. I am sure you are absolutely correct in that statement.

That is all.

Mr. BARTLETT. Mrs. Pfost?

Mrs. PFOST. I presume you would join with the other people who have testified before us that you would like to dispose of the fish traps?

Mr. ERICKSON. That is up to the Government.

Mrs. PrOST. Do you think getting rid of the fish traps would help your fishing industry here?

Mr. ERICKSON. I would say the way they are going now, no, but I am not speaking in favor of the salmon industry that have the fish traps.

Mrs. PrOST. If we cannot give you immediate statehood, would you like us to turn the fishing industry over to the Territory of Alaska? Mr. ERICKSON. It would be a wonderful thing to turn it over to the Alaska Department of Fisheries. But where are we going to get the money? The Federal Government has to furnish the money as long as we are a Territory.

Mrs. PFOST. That is all.

Mr. BARTLETT. Mr. Sisk?

Mr. SISK. I would like to clarify one thing. I don't think that there has been too much criticism of individuals in the Fish and Wildlife Service in Alaska, but the criticism primarily has been aimed