In 1965, the amount of the Presidents' budget was $347 million. The amount appropriated was $343.8 million. In 1966, the President's budget request was $346.6 million. The amount appropriated was $340.1 million. Mr. DREWRY. Then it must have happened in the Senate. I have the House report here. There was that additional ship added. The other thing which I would like to bring up, because it has been discussed is this Dr. SEIDMAN. I will say you are probably correct. I notice that on the construction subsidy the amount of the President's budget was $124.8 million. The amount of the appropriation was $132.8 million, so that there was an increase in the construction, but there was an overall reduction. So they took it out in the operating subsidy. Mr. DREWRY. I wanted to get that clear. On the subject of the distinction, if any, between maritime subsidies and civil aviation subsidies, this question came up durng the Department of Transportation hearings, and there was this exchange between Mr. Erlenborn and Mr. Schultze: Mr. ERLENBORN. What is the rationale behind putting the Maritime agency within the Department and leaving CAB outside of the Department? Mr. SCHULTZE. It seems to me that in this case the-you have to have a background for this. The Federal Maritime Commission, as you realize, stays outside the Department, and there is the Federal Maritime Commission and the Maritime Administration. In the case of the CAB and its economic regulatory functions-subsidy relationships this cannot be pulled apart from the continuing workload of the CAB in awarding specific routes to specific carriers. Now, it is true, in the case of the Maritime Administration this same thing happens, except in practice I don't think there has been a new trade route in how many years, Alan? Mr. Boyd said: "I don't think since the Merchant Marine Act of 1936." I know Mr. Boyd is not here, and you cannot be expected to answer for him, but I am quite sure that my understanding is correct, that there is a constant and continuing study of trade routes going on in the Maritime Administration, and every study takes into account the award of these trade routes. It is true that in recent years there has been little action in the Administration in the awarding of these trade routes, but the function is the same. Dr. SEIDMAN. We don't grant certificates of convenience and necessity for maritime trade routes. I think each operating subsidy requires evaluation of service on a trade route preliminary to the granting of subsidy. Mr. DREWRY. There is no difference as far as the American carrier is concerned. Dr. SEIDMAN. There is a difference in the type of action taken by the CAB when they grant a certificate of convenience and necessity to a particular carier to go on a particular route. Mr. DREWRY. That may be, but this does not seem to be what is being discussed here. There is a recognition that there is the same type of authority, and the statement was made that it had not been exercised in the past 30 years, which I say, just for clarification of the record, is either not true, or else it is very poorly expressed. Dr. SEIDMAN. I would think the ones who said it ought to be the ones to clarify it. Mr. DREWRY. I agree. The CHAIRMAN. Thank you very much, Dr. Seidman. Dr. SEIDMAN. Thank you, Mr. Chairman. The CHAIRMAN. Without objection, we will place miscellaneous documents in the record at this point. (The material follows:) STATEMENT OF CHAS. R. SEAL, CHAIRMAN, COMMITTEE ON FEDERAL LEGISLATION OF THE NORTH ATLANTIC PORTS ASSOCIATION The North Atlantic Ports Association represents coastal ports from Searsport, Maine, to Hampton Roads, Virginia, which are very much interested in an adequate United States flag merchant marine. The Association favors the enactment of pending legislation to make the Maritime Administration an independent agency of the Congress. Inclusion of the Administration in a Department of Transportation as proposed by other pending legislation would have the effect of submerging it in a mass of diversified and wholly unrelated domestic transportation activities. The United States merchant marine has declined at such a pace in recent years, since it was made a subordinate in the Executive Branch of the Government, until it is now at a level that does not begin to reflect the intent of the Congress as stated in the Declaration of Policy in Section 101 of the Merchant Marine Act, 1936, as follows: "It is necessary for the national defense and development of its foreign and domestic commerce that the United States shall have a merhcant marine (a) sufficient to carry its domestic water-borne commerce and a substantial portion of the water-borne export and import foreign commerce of the United States and to provide shipping service on all routes essential for maintaining the flow of such domestic and foreign water-borne commerce at all times, (b) capable of serving as a naval and military auxiliary in time of war or national emergency, (c) owned and operated under the United States flag by citizens of the United States insofar as may be practicable, and (d) composed of the best-equipped, safest, and most suitable types of vessels, constructed in the United States and manned with a trained and efficient citizen personnel. It is hereby declared to be the policy of the United States to foster the development and encourage the maintenance of such a merchant marine." U.S. flag vessels have been carrying only about 9 percent of this country's foreign commerce. This condition is being worsened by the necessity of diverting vessels from commercial use to carry supplies to Viet Nam. As indicated above, there is no relationship between ocean transportation in foreign commerce and such principal functions of the proposed Department of Transportation as railroad, highway and aviation safety, the Coast Guard, certain activities of the Army Corps of Engineers, and standards and criteria for water resources projects. Some of the functions of the Maritime Administration, and particularly those of the Maritime Subsidy Board, are of a quasi-judicial regulatory nature. These include the determination of essential trade routes and processing applications for operating differential subsidies, ship construction subsidies, and ship mortgage insurance, with respect to which the Board conducts formal proceedings in which it may subpoena witnesses, administer oaths, take evidence and render formal decisions. The functions of the Administration in these categories are the same as the regulatory functions of the Interstate Commerce Commission and the Federal Maritime Commission which the pending legislation would properly exclude from the proposed Department of Transportation. The U.S. merchant marine is badly in need of revival, which could hardly be expected if the administration of the merchant marine laws were submerged in all of the unrelated duties of a Secretary of Transportation. The Congress has a duty under its stated policy to take such steps as will best serve to restore our merchant marine to an adequate status. It can best discharge this duty by omitting the Maritime Administration from a Department of Transportation and making it again an independent agency. STATEMENT OF W. J. AMOSS, CHAIRMAN, COMMITTEE ON NATIONAL TRANSPORTATION POLICY, AND FIRST VICE PRESIDENT OF THE AMERICAN ASSOCIATION OF PORT AUTHORITIES In connection with legislation currently under consideration to establish a Department of Transportation at Cabinet level, the Board of Directors of The American Association of Port Authorities has given a serious study to various aspects of the proposal, and does not favor the transfer of the Federal Maritime Administration from the Department of Commerce over into the proposed Department of Transportation. Rather, we recommend that the Maritime Administration be assigned independent status. In support of this recommendation, we point to the following: 1. The effectiveness of the American Merchant Marine program as carried forward from 1936-1949 under an independent agency, the Maritime Commission. 2. The decline in American-flag shipping from the period 1949 to date with the Maritime Administration operating in subordinate status in the Department of Commerce. 3. The importance of the Merchant Marine to the economic life of the nation, including its singular importance in our country's efforts to maintain and improve its balance of payments position. 4. The vital place of the U.S. Merchant Marine in national defense as demonstrated in World War I, World War II, the Korean Conflict, and the present action in Vietnam. 5. The very important role of the U.S. Merchant Marine in the field of foreign affairs. 6. The very important role of the United States Merchant Marine in the field of United States world trade. The Maritime Administration, it is plan, has a statutory responsibility which should be exercised independently. Many of its responsibilities, as above outlined, go far beyond the subject of transportation and involve the fields of finance, foreign affairs and military potential, as well as the flow of vital commerce. Accordingly, the Board of Directors of The American Association of Port Authorities desires to record its support of the general objective of the abovenamed bills in the form of an Independent Federal Maritime Administration. Hon. EDWARD A. GARMATZ, GOVERNMENT EMPLOYES' COUNCIL-AFL-CIO, Committee on Merchant Marine and Fisheries, Washington, D.C., July 25, 1966. DEAR MR. CHAIRMAN: Thirty-two AFL-CIO unions representing employees in the wage board, postal and classified services of the Federal Government comprise the Council. Members of these organizations employed by various Federal agencies total more than 1,000,000. As citizens, these men and women have a keen interest in maintaining a strong merchant marine and to insure the commercial and defense posture of the United States among the nations of the world. For too many years we have lacked a basic national maritime policy, which would enable the United States to attain on the world's waterways a status in keeping with our national responsibilities. As a consequence, we have witnessed the progressive deterioration of our merchant marine fleet. This has been caused in no small measure by the fact that Federal agencies responsible for administration of our maritime program have not possessed the independence essential to the development of an effective, balanced national program. Thus, the Council views with deep concern the proposal now pending in the House Rules Committee in HR-15963, to include the maritime functions of the Federal Government in a Department of Transportation. Congressional approval of this feature of the bill would simply compound the present confusion and would accelerate further the lamentable decline of the maritime and related industry. Instead, it is our considered judgment that Congress should enact legislation similar to H.R. 15567 and related bills creating an independent maritime agency. The Council urges early, favorable action on such legislation by the Committe Our affiliated organizations desire to express their appreciation for the sympathetic understanding displayed by the Committee to date and request your continued cooperation on the legislation, which is the subject of the current hearings. This position was arrived at unanimously after full discussion at the last regular meeting of the Government Employes' Council. Very truly yours, Hon. EDWARD A. GARMATZ, JOHN A. MCCART, MISSISSIPPI VALLEY ASSOCIATION, Chairman, Merchant Marine and Fisheries Committee, Dear Mr. GaRMATZ: The Mississippi Valley Association takes this means to assure you and your Committee of its support of H.R. 11364 to create the Federal Maritime Administration and H.R. 15567 to create the Federal Maritime Board Administration, and requests that our position be made a part of the record of your Committee. Earlier in this Session, witnesses for the Mississippi Valley Association testified in opposition to the Transportation Department Bills, H.R. 13200 and S. 3010, before the Committees on Government Operations of the House and Senate, and in this testimony and amendments, we urge the creation of an independnt Maritim Administration. In May of this year, Mr. A. C. Cocke, Chairman of the Traffic Advisory Committee of the Mississippi Valley Association, offered our testimony in opposition to the Transportation Department Bill, and in so doing submitted the following concerning a separate Maritime Administration. "Under this proposed Bill, it is noted that the Maritime Administration, presently under the Department of Commerce, will be transferred to the Transportation Department. While a transfer from one department to another is in itself not objectionable, it is our strong feeling that the American Merchant Marine is so vital and important to the commerce of the United States and to the Department of Defense that it should be an independent agency reporting directly to the Congress and not through any other department. This was our strong opinion during the Reorganization Plan of 1961; we were in favor of the separation from the Federal Maritime Board of regulatory matters and promotional matters, such as subsidy, and favored the Federal Maritime Commission as an independent agency for regulatory matters but were unalterably opposed to the Maritime Administration being placed under the Department of Commerce, and it was our understanding at that time the American Merchant Marine industry was almost unanimous in accord with this view. We are not blaming the Department of Commerce-Maritime Administration for the deterioration of the American Merchant Marine, but the facts remain that unless strong and prompt action is taken by the Administration our Merchant Marine will disappear from the high seas or become of no consequence and of no help to the defense of our country in war times and the present situation of lack of tonnage for use in Viet Nam is an example of the present deplorable state of our Merchant Marine. We are now fifteenth among the nations of the world in shipbuilding for commercial purposes and this is a disgrace. We strongly urge that the Maritime Administration be made an independent agency reporting to the Congress and that the Congress forthwith enact legislation to build a Merchant Marine that can be justly proud of and will answer the purposes for which it was intended, namely for the commerce of the United States and for defense purposes during war or times of emergency." Subsequently, the Senate Committee on Government Operations requested suggested amendments to the Transportation Department Bill, S. 3010, and on June 28, Mr. Arnold Sobel, President of the Mississippi Valley Association testified before that Committee and submitted among other suggested amendments the deletion from the Transportation Department Bill that would transfer the Maritime Administration from the Department of Commerce to the Department of Transportation and stated: "It is our strong feeling that the American Merchant Marine is so vital and important to the commerce of the United States and to the Department of Defense that it should be an independent agency reporting directly to the Congress and not to any other Department. Our proposed amendment to Section 6(a) would prevent the transfer of the Maritime Administration from the Department of Commerce to the Department of Transportation. We furher urge that the Congress forthwith enact legislation which would make the Maritime Administration an independent agency reporting directly to the Congress." It is again respectfully requested that our views on the creation of an independent Maritime Administration be incorporated in the record of the hearings of your Committee on H.R. 11364 and H.R. 15567. Sincerely, ROBERT L. SHORTLE, Vice President. THE PROPELLER CLUB OF THE UNITED STATES. Hon. EDWARD A. GARMATZ, DEAR CONGRESSMAN GARMATZ: The Propeller Club of the United States, a maritime and marine society dedicated to the support of the development and maintenance of an American Merchant Marine adequate to fulfill the requirements of national security and the economic welfare of the United States, having carefully considered the maritime needs of our country, has taken a Position concerning an Independent Maritime Agency. This Position of our society represents a complete consensus of Propeller Club member organizations and their memberships throughout the United States which consists of representatives from every segment of the maritime industry and allied industries and organizations. The Position is attached. It is respectfully and urgently requested that the views therein be considered carefully and that whatever action is required be taken. Very truly yours, E. D. VICKERY, National President. THE PROPELLER CLUB OF THE UNITED STATES POSITION ON AN INDEPENDENT MARITIME AGENCY BACKGROUND The President of the United States has proposed that the Congress enact legislation creating a department of Transportation headed by a new cabinet officer, the Secretary of Transportation. This proposal is embodied in H.R. 13200 and S. 3010 now before the Congress. It has been overwhelmingly concluded within the maritime industry, including both labor and management, that such legislation will not achieve the basic objectives envisaged. To include maritime promotional functions within the proposed new Department of Transportation will obscure and hinder maritime programs rather than advance them. Experience has conclusively demonstrated that a maritime agency subservient to one of the Executive Departments of government simply does not work. Sixteen years ago the then Maritime Agency was abolished by Reorganization Plan No. 21 in favor of a new agency lodged within, and subservient to, the Department of Commerce. This subordinate relationship was continued in 1961 under Reorganization Plan No. 7 against the opposition and expressed misgivings of the maritime industry. A progression of administrative subservience has developed whereby the actions of the Maritime Administrator must be analyzed, diagnosed and reviewed in minute detail by pyramiding echelons of supervision in the Department of Commerce. This proliferation of judgment and decision has stultified progressive administration of our national maritime policies and programs and directly thwarted responsible efforts to meet the objectives of the 1936 Merchant Marine Act. These practices are now to be further promulgated by another submergence of maritime functions within a miscellany of transportation agencies. There is no logical need for such action. Ocean shipping is decidedly unlike any other mode of transportation. It does not generally compete with other seg 67-225-6615 |