agement, and labor, those interested in shipping, shipbuilders, those who do the work in the shipyards. These are areas that I think have to be paramount if we know what we are funding and why we are funding it. To me this starts with zeroing in on the problem. I think the sentiment that has been expressed here today would indicate that there is a considerable lack of confidence in a Cabinet level department in zeroing in on the problem that is so paramount here. It is indicative to me that the administration is still assuming that we are going into the Department of Transportation because as I understand your testimony, and you correct me if I am wrong, the primary responsibility for developing whatever program is being developed is in the Secretary of Transportation; is that correct? Secretary TROWBRIDGE. The President asked Secretary Boyd to coordinate and lead the formulation of this program but we are all involved in it. Mr. EDWARDS. The President has expressed an interest in the problems of the merchant marine as you said Secretary TROWBRIDGE. Yes, he has. Mr. EDWARDS (continuing). As I recall, in January of 1965 in his state of the Union address, and I don't recall much since, but it would seem to me that with so many bright young men downtown in the various agencies that between January of 1965 and now something could have been set up here that would give us a basis for work. It just appears that the advancement of the Maritime Administration has come to a halt until the President gets the agency into the Department of Transportation. Without any reflection on the very able Mr. Gulick I think the fact that the administration has not appointed a new Maritime Administrator since last year is further indication of this. What really has the Department of Commerce done since you became Acting Secretary-other than working with Mr. Boyd to come up with a policy-to give industry some sense of direction, to give the shipbuilders some sense of direction, and to give this committee some basis on which to act? Secretary TROWBRIDGE. Congressman, I became the Acting Secretary on February 1, and was confirmed as full Secretary on June 14. During that time, as you have indicated, I have worked with Alan Boyd and other members of the Administration in the attempt to hold together this maritime program and to gain support for it. It seems to me that this in itself is fulfilling the kind of responsibility which the Secretary of Commerce has, working within the Administration to establish the policy and the program. At the same time the Maritime Administration, operating under the Department of Commerce, has the responsibility of fulfilling the act of 1936 and the current budgetary program. If you would care to have a rundown of what the Maritime Administration has been doing in that field of implementing the 1967-68 program, I would like to ask Mr. Gulick to comment on it. Mr. EDWARDS. I would like to hear from Mr. Gulick if he can tell us anything about the direction of policy. I don't want to hear about administrative functions that he does quite well. I would like to hear some ideas that give us some sense of direction in zeroing in on the problem. I notice you mention on page 4 that: it is understandable to believe that an independent agency within the executive branch can best act as an advocate of the interests of a particular industry My question is, isn't this what we so desperately need? I think this is the key to the problem to have somebody who is interested in this particular industry. If Mr. Gulick can talk about direction and policy and what would really happen if it went into the Department of Transportation I would be happy to hear that. Mr. GULICK. Mr. Edwards, I will be delighted to comment upon this. The fact is that in the last few years we have been more or less continuing at a fairly low level moneywise the implementation of the 1936 act merchant marine program. There are, however, certain things which we have been able to do within the limitations of our money support and these we think are important. An example of this would be the multiyear construction of new ships under which we have been able to offer larger blocks for bidding in the hope of accomplishing two principal purposes: One, the reduction of ship costs and, two, obviously the upgrading of the shipyards with a larger capital investment on their part growing out of the award of a larger block of ships for construction. In addition we have been able to come up with new ship designs. We have endeavored to work with the operators on improved procedures. We have worked with our friends in labor, we think, very successfully to open channels of communication and to lay the problems out on the table. All of this is to say that there are limitations upon what may be accomplished in the absence of, one, a viable, accepted administration-backed program supported by Congress and the furnishing of sufficient money to do this. Mr. EDWARDS. Which we have not seen yet. Secretary TROWBRIDGE. But this Mr. Edwards is what the Secretary has been saying so expertly here. This program is under consideration. It is in the process of being formulated and it has been brought down now out of a zero possibility to a 99-percent possibility of getting up and moving because it is only hung up on one or two really important points. Now, every effort is being made to resolve those points. If these difficulties can be compromised, if there can be agreement upon a program, there is no reason why we shall not see great advances in our merchant marine implementation. This in my judgment I have to say can best be accomplished within the Department of Transportation. My answer to this, my reason for this is very simple: The day of a ship program standing alone, ship for ship, transporting only cargoes from one continent to another is past. We are in a new age now in which the transportation movement is from shipper in one continent to consignee in another continent. This requires a combination of modes. It requires the overcoming of interphase problems between the water and the land transportation media. It requires policies, new policies which we have never faced before. One such simple policy which will obviously be coming up before too long is the matter of shall there be a transportation company engaging in different forms, different modes of transportation or shall there be just a shipping company. This is not to say that there is any commitment toward this end. This is merely setting up a problem which has to be considered. Suppose Maritime were a separate agency. Suppose in the development of intermodal transportation policies and programs you have in opposition to the maritime interests a line up of air, rails, and trucks who want to accomplish a certain degree of movement in their own field from inland points to seacoast. It seems to me perfectly reasonable to assume that in this context once again the marine industry is going to be at the mercy of a group of other transportation facilities who over the years have constantly opposed efforts by the marine interests to raise themselves by their own bootstraps. On the other hand, if there is one Cabinet officer holding the reins of policy over these different competing forms of transportation and saying to those in the marine side as well as the land side or air side: "You fellows have to get together and we have got to come up with one set of policies and procedures which will make the whole system fly," I think then we are on the threshold of real movement and I think then the marine industry can occupy the place of importance that it should and which it does not today and which it cannot today. Mr. EDWARDS. What you say is true, of course, Mr. Gulick, because, as it is today, the Department of Transportation Secretary would be dealing with foreign-flag ships. We don't have enough ships to worry about it now. We have to get a shipbuilding program going. We have to get to where we are carrying our own commerce and the missing link in what you are saying is that right now the truckers and railroad men would be dealing with a foreign ship rather than an American ship. This is just my opinion, but if you are going to stop this bill I think you are going to have to come up before the Congress and the people of this country with a policy. I think if you don't, in my opinion again, this bill is going to go through. So it is up to you whether you stop it or not. Mr. CLARK. Will the gentleman yield. Mr. EDWARDS. Yes. Mr. CLARK. Mr. Gulick, you gave a very nice speech but what I want to know, and I think the members of the committee want to know, is what is your program. You have had this for over 4 years that you are hoping that you can come up with some kind of a program that would satisfy us. We haven't seen it yet but we have seen in the papers where the Secretary has said that he is going to start a building program but most of the ships would be built overseas. How many are to be built overseas? No one knows. Last year they cut the estimate down from 25 to 15. None of you people-and I am talking about you, too,—have come up and said, "We are going to put these 10 back in to build them next year." You have not done that. You have not given us a program. If you want us to be for your program then you are going to have to come up with a shipbuilding program that is second to none. Right now I have just come back from Japan and I was over in Germany. They have a shipbuilding program that is way above ours and I can't say that they are not an independent agency because I think they are. They are working as such anyhow. They are building ships today five times faster than we are. We have nothing. I am giving speech now, too, Mr. Gulick, but we have nothing compared with the shipbuilding program that they are going to have within the next 15 years. You come up with a program, Mr. Secretary, and I am sure that this committee will buy it if they know that you really mean it, really mean to have a merchant marine second to none. When that happens this committee will wholeheartedly support your program I am sure. Secretary TROWBRIDGE. Mr. Clark, this is precisely what we are attempting to do right now. Mr. EDWARDS. This is a matter of priorities, Mr. Secretary. When we sit here and see a half billion dollars for highway beautification and at the same time see our merchant marine continue to sink it concerns us. I am convinced that whether this bill is stopped depends on you. Mr. BYRNE. Will the gentleman yield. Mr. EDWARDS. Yes, I yield. Mr. BYRNE. Mr. Secretary, Mr. Clark mentioned the 25 ships being authorized and cut down to 15. Who was responsible for that? Did you do it your own or was it the President? Secretary TROWBRIDGE. No, this was the original proposal of the Maritime Administration to the Secretary of Commerce at budget level for fiscal year 1968. There was envisaged a construction program of 25 vessels. Secretary Connor, in reviewing the Department of Commerce budget, which he then forwarded as the Department of Commerce budget, including the Maritime Administration's portion to the Bureau of the Budget, included a figure for ship construction which would allow approximately 15 vessels. This was a determination of priorities. This was a determination of the amount of money available to be asked for by the Department of Commerce. These are the two figures that have been described here, Mr. Congressman. Mr. BYRNE. Who brainwashed the Director of the Budget on this? Mr. CLARK. He is sitting right there. Why don't we wait and ask him? Mr. BYRNE. Can you answer this question? Secretary TROWBRIDGE. At every level of the decisionmaking obviously somebody has to come to a conclusion as to how much money we have and how much we can spend on various portions of the Government expenditure. Mr. BYRNE. We do that at home. Secretary TROWBRIDGE. We do it everywhere. Mr. BYRNE. We always find a private spot where we get what we want. I want to know who was responsible for this and what was the reason. Secretary TROWBRIDGE. The Secretary of Commerce was responsible for cutting down. Mr. BYRNE. Who told him, our friend back there? Secretary TROWBRIDGE. I think Jack Connor is probably pretty good at making up his own mind, Mr. Congressman, and I think he made up his mind as he thought best in the national interest and he then proposed this to the Bureau of the Budget which then incorporated it in the total budget approval. Mr. BYRNE. I agree with you on Mr. Connor. I liked him. But I still would not want him as a boss. My constituents are my bosses and I come from a ship area. Naturally I am interested in ships being built in American shipyards by Americans. By doing that they bring taxes into the Treasury, money which keeps this show going. Most of our money, as you know, goes for veterans, defense, and post office. Where are we going to get this money if we are going to build ships in Europe and have these same seamen take our seamen's jobs? I disagree with you and I am going to do all I can to see that we get our own maritime. That is all. The CHAIRMAN. Mr. Reinecke. Mr. REINECKE. Thank you, Mr. Chairman. Mr. Trowbridge, when the President asked Mr. Boyd to make this recommendation don't you feel that that was an act in defiance of Congress in view of the fact that he had specific instructions to the contrary? Secretary TROWBRIDGE. No, I don't believe so, Mr. Congressman. I know that the action of the Congress in denying the transfer of the Maritime Administration to the Department of Transportation as part of the Department of Transportation bill was on the record, yes, but it seems to me that the President has not only the responsibility but the right to call upon his advisers for leadership in the development of the administration policy, and he not only has that flexibility but has to implement it, has to use it. Mr. REINECKE. Wouldn't it be more sensible to ask you to prepare the plan? Secretary TROWBRIDGE. Well, I think the President was saying, in effect, that the Secretary of Transportation, with responsibilities, with resources available to look at the total transportation needs of this country, should be the coordinator and leader of an effort to pull together a maritime program as part of those total transportation needs. Now, he did not, in so doing, tell me to stay out of it, nor Secretary McNamara, nor Secretary Wirtz. Indeed, he said, "Get into it, help, work together," but this was his decision as far as the leadership role there. Mr. REINECKE. When was this instruction given to Mr. Boyd! Secretary TROWBRIDGE. I recall the meeting but it was earlier this year. When was it? A number of months ago, 5 or 6 months ago. Mr. REINECKE. Mr. Trowbridge, I think what is bothering us here is that none of us is particularly married to the idea of an independent agency. What we are looking for is to have the Maritime Administra tion put someplace where some action will take place. A good case has been made for it being put in the Department of Transportation but we don't think it will do any better there than in Commerce. It seems to me that this is a rehash of the old position that the adminis tration's mind is closed and I don't see any point in the committee taking any more time. The CHAIRMAN. Mr. Lennon. Mr. LENNON. Mr. Secretary, you will recall, I believe, that in August of last year there was on the floor of the House the act to establish a transportation department. Secretary TROWBRIDGE. Yes, sir. Mr. LENNON. At which time the House by a recorded vote of better than 2 to 1 took out the Maritime Administration and left it in the Department of Commerce. The gentleman from California, Mr. Holi |