Before the Interstate Commerce Commission: Protest of the Council on Wage and Price Stability in Opposition to Proposed Ten Percent Increase

by Barry Bosworth on December 27, 1977
by Barry Bosworth, Milton Kafoglis, Roy A. Nierenberg and Thomas D. Hopkins

The Council on Wage and Price Stability today protested a proposed 10 percent increase in interstate bus fares. The Council urged the Interstate Commerce Commission, which must rule on this proposal, to suspend the proposed increase and conduct an investigation into:  Whether the bus industry has properly balanced the level of bus fares and the level of bus service; and whether the bus industry indeed is in “perilously weak” financial condition. The proposed 10 percent increase in interstate fares,  will become effective January 6, 1978, unless the Commission orders otherwise, follows an 11 percent rate hike granted by the ICC in May 1977. Taken together, bus rates would rise by more than 20 percent in less than a year, which is far in excess of the general rate of inflation in the economy as a whole. The intercity bus industry, consisting of Greyhound, Trailways, and about 30 smaller carriers, provides basic transportation service to the poor, the old, and the young -groups that can ill afford to pay higher rates. The Council was critical of the Commission for utilizing inadequate regulatory standards and for a tendency to grant increases without examining the fundamental problems that plague the industry. Following the May 1977 increase in bus
fares, which the Council also protested, the Commission announced a staff study to produce reliable data on the health of the industry and the economics of bus operations. This study is, scheduled for completion in early 1978. The Council recommends that the Commission scrutinize this staff study or conduct , formal investigation on its own before granting the new rate hike.

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