[Weekly Compilation of Presidential Documents Volume 32, Number 1 (Monday, January 8, 1996)]
[Pages 1-2]
[Online from the Government Publishing Office, www.gpo.gov]

<R04>
Statement on Signing the ICC Termination Act of 1995

December 29, 1995

    I have today signed into law H.R. 2539, the ``ICC Termination Act of 
1995.'' In my State of the Union address this year, I called upon the 
Congress to terminate the Interstate Commerce Commission (ICC). I also 
called for further reductions in unnecessary regulations. This 
legislation is consistent with those goals, but it does not go far 
enough.
    The bill eliminates the ICC, transferring many of its functions to a 
new Surface Transportation Board (STB) located within the Department of 
Transportation (DOT). The bill reduces some ICC functions, including 
those that overlap with DOT with regard to overseeing safety and 
insurance requirements in the trucking industry. With the sunset of the 
ICC and the consolidation of motor carrier functions at DOT, the bill 
will produce moderate budget savings.
    The bill will also help provide a smooth transition now that 
appropriations for the ICC have been terminated. And the bill empowers 
the new STB to promote deregulation administratively on a case-by-case 
basis. I call upon the Board to use this authority to the fullest extent 
to benefit consumers and facilitate economic growth.
    I am also satisfied that the Congress addressed my Administration's 
strong objections to earlier versions of this legislation, which would 
have severely curtailed labor protection for railroad employees 
adversely affected by certain railroad transactions, including mergers. 
And I note that the final version of the bill continues intact the 
important rail reforms of 1980, which have helped improve rail service 
and bring the railroad industry back to profitability.
    Nevertheless, I am disappointed in this bill. While it eliminates 
the ICC, it creates a new independent agency, the STB, within the 
Transportation Department. Overall, the bill falls short of my 
Administration's much bolder proposal for extensive deregulation of 
transportation industries.
    Regulatory reform of the Nation's transportation industries has been 
an outstanding success. Beginning with air cargo deregulation in 1977 
and continuing with sweeping rail and trucking reforms over the past 15 
years, much of the stranglehold of government regulation has been 
broken. Today, only about 20 percent of all domestic freight 
transportation is regulated, compared with 75 percent 20 years ago. 
These reforms have reduced the cost of transporting everything we buy 
and use. They have also enabled U.S. producers and retailers to employ 
``just in time'' manufacturing and inventory systems to save many 
billions of dollars in warehousing and distribution costs.
    The Congress had an opportunity to build on this success but, 
instead, provided for only very modest reform. While this legislation 
eliminates a number of obsolete and unnecessary functions of the ICC, it 
still exempts transportation industries from many of the disciplines of 
competition. These exemptions are no longer justified in today's strong 
and competitive market economy.
    For example, the Nation's trucking industry has enjoyed antitrust 
immunity for collective ratemaking for the last 47 years. Continuation 
of this immunity reduces potential benefits to consumers and protects 
inefficient carriers. This bill also maintains special merger standards 
for railroads. The railroad industry should be subject to the same 
merger standards as other transportation industries.
    The bill vests the Chairman of the Surface Transportation Board with 
the authority to appoint ``officers and employees of the Board.'' The 
Appointments Clause of the Constitution, Art. II, sec. 2, cl. 2, permits 
the Congress to vest the appointment of inferior officers in the head of 
a department. Because the Board is ``established within the

[[Page 2]]

Department of Transportation,'' it is a bureau or component of a 
department, and cannot be a department unto itself for purposes of the 
Appointments Clause. Accordingly, it would be unconstitutional for the 
Chairman to appoint persons to serve as ``officers'' in the 
constitutional sense. Therefore, I am signing this bill with the 
understanding that it does not authorize the Chairman to appoint 
``officers'' in the constitutional sense.
    The bill provides for the authorization of appropriations for the 
Board to expire after 3 years. During this period, my Administration 
will monitor the regulatory activities of the Board to determine whether 
it should continue and whether further reforms would be beneficial. My 
Administration remains committed to continued deregulation of the 
transportation industry.
                                            William J. Clinton
The White House,
December 29, 1995.

Note: H.R. 2539, approved December 29, was assigned Public Law No. 104-
88. This statement was released by the Office of the Press Secretary on 
December 30.