the operating unions would go along with the program if they could see where they get on and off the boat. When you are talking about 30 ships a year, talking about a 40-year program that is going no place, everybody is going to play it close to the vest and you are not going to move. It is not in the cards to get out of our dilemma. Mr. EDWARDS. I would like to use you sort of as a sounding board on something that kind of bothers me since you have this background and come here with so fine a statement. I suppose all of us here on the committee, as you have probably, have referred constrantly to Russia in comparing what we are doing as compared with what they are doing, how we once had a modern fleet and so forth, and they are now catching up with us and in a short period of time if we don't do something they will pass us and so forth. So Russia as far as merchant shipping is concerned is our great competitor. To what extent should we follow the Russian approach to this? In other words, the Government in Russia is building the Russian ships. Russia builds abroad in other countries. There is Government ownership of those ships. I assume that you are talking about a private enterprise type of fleet. Mr. LEGGETT. I am not talking about a Government-owned fleet, that is true. Mr. EDWARDS. That is unthinkable in this country, isn't it? Mr. LEGGETT. I just think you would buy a big management problem and why have the Government spend a billion dollars to obtain a fleet when they can spend maybe a billion dollars and have it matched by a billion dollars in private industry and obtain a fleet twice the size. Also they can delegate the bulk of the management program to private industry where it belongs. Mr. EDWARDS. Šo that when they frequently refer to Russia-and I have done this many times myself and the way they are out building us, there is a different situation entirely in this country as compared with their approach to shipbuilding. You agree with that, don't you? Mr. LEGGETT. I think that is true, but I think we can take a page out of their book as far as postulation of programs. They have had so many unsuccessful programs that you don't want to take all of their ideas, but occasionally they kind of break the bank. I think they have pretty much of a success story as far as their shipbuilding program goes. I don't think it takes a merchant marine scientist to figure out that it is not to our advantage to allow them to gain that advantage over the United States. Relatively we should have a merchant marine twice the size and twice as good as the Soviet Union. Our Navy is twice as good as theirs. Our merchant marine should be too. Mr. EDWARDS. If it appeared that whatever we are trying to do is not working, then would you favor more and more or larger and larger percentages of subsidy to do whatever it took to keep this ratio that you are talking about? Mr. LEGGETT. Well, I think if you properly think out a program you will know before you ever spend dollar one, except for the R.D.T. & E. and such as that, but you will know exactly where you get on or off. I don't think this is a situation where they are going to necessarily want to escalate like we do in defense. They have certain requirements they want to satisfy and that is what they are going to do. We ar certain requirements and want to satisfy those. I think we can figure that out in advance and not get into this wr wind perpetuating cycle. Mr. EDWARDS. I judge from what you say that in your opinion problem is not insurmountable, that what we really need is to put bright, young workers to work on the problem and let them drear little and come up with something that is imaginative rather than t tired, old, year-in and year-out programs. Mr. LEGGETT. Just as an example now the Secretary of Defense: his response to modernization of shipyards has said, "Well, let us velop the FDL program and spend $100 million for new ship. somewhere on the east or gulf coast and this will have a kind of it tious effect on the rest of the industry." Well, we have got that situation right now. You have probabl third of all of the naval ship contracts going right to Newport New Probably another 20 percent of them go to Groton and what infecti effect has this had on New York shipbuilding and some of the o shipyards that have gone more or less down the drain. I don't kn whether they have but a lot of them are rather dissipated. It has effect whatsoever which means that you just can't throw some more" up in the air and hope that it blows to the four winds and that socthing is going to happen. You have to figure it out in advance and I tell you with the prog of the Secretary of Defense on FDL that would have no effect wha ever on our domestic shipbuilding capability. Mr. EDWARDS. And in effect would drain money off that should available for the merchant fleet? Again, back to the meaty problem, have you seen in the Comme Department and therefore in the Maritime Administration any r thought or any real advances that have been made for the benefit of merchant marine, substantial advances over the last few years! Mr. LEGGETT. I think the main advances have been made as the re of the innovativeness of private industry. Mr. EDWARDS. And not the Government itself? Mr. LEGGETT. $105 or $120 million was the amount of the constr tion subsidy. When we talk about it as a subsidy it seems a little (. landish. I think we ought to get out of the subsidy nomenclature. don't think that does us any good. The public doesn't like to hear but on the other hand the public has a feeling just like the Congdoes that we need a merchant marine and I think we ought to buy and rent it and keep it available. Mr. EDWARDS. And you think that the cost chance of that coming pass and bringing together those people who can solve these prob is through the means of an independent agency? Mr. LEGGETT. I do. Mr. EDWARDS. Thank you very much. The CHAIRMAN. Mr. Reinecke. Mr. REINECKE. Thank you, Mr. Chairman. I might say to my California colleague that that is an excellent sta ment and we thank you for it. Mr. Edwards made two comments that I would like to add to. One as about the bright, young thinkers and I think we ought to be careful bout that because I think McNamara has a few of those over there nd that might be the trouble. Mr. LEGGETT. We need some bright, old thinkers. Mr. REINECKE. I think some bright thinkers with the background. Mr. EDWARDS. Would you yield? It might be better if they were made by the Maritime Administration. Mr. PELLY. If you will yield, I think Nicholas Johnson was an examle of just such a "bright, young thinker." He was a bright, young nan with no prior knowledge of our maritime industry. We therefore lo have to be careful who we get in such decisionmaking positions. Mr. REINECKE. Mr. Leggett, going a little further, you definitely eel that an independent agency is the more proper route than the DeDartment of Transportation? Mr. LEGGETT. Of course, I would say this: I want to be frank with he committee. It is all a question of postulating a program and I lon't think it makes a hill of beans worth of difference whether or not you have an independent agency or the Department of Transportation or such as that. The Peace Corps is an independent agency and seems to have a very successful program. They are not fettered by all of the checks and balances that you have in some of the Cabinet agencies. Right now Maritime is going down the drain and it is now part of a Cabinet agency where allegedly it is getting all this special treatment and has its spokesman in the President's inner circles. You have to have a man run this program who is sold on maritime development. I don't think Secretary Boyd is. I think he is probably great for transportation but not for the maritime industry so that I think the response of this committee is exactly right, let us develop an independent agency and postulate a program. The President said he wants it. Let us do it. Mr. REINECKE. Thank you. The CHAIRMAN. Mr. Morton. Mr. POLLOCK. Yes, Mr. Chairman. I want to congratulate my friend Bob Leggett, the gentleman from California, on a very excellent statement. I think it is obvious that you have done your homework well. I was pleased to see the few remarks you made about Mare Island. As you know, I was a former resident out there and I am very well aware of the history of the great naval shipyard there. I would like to echo the remarks that have been made by you in addition to your statement. I agree that we have to very radically modify the budget and have to appropriate some very substantial sums to assist the private sector. When we talked before you mentioned the Republican policy statement. We have indeed issued a policy statement of strong support for the merchant marine and it would seem to me that now our first job is to prevail upon our colleagues in the House and then in the Senate to pass some legislation such as we are doing now, some, I think, very meaningful legislation because this would be one of the ways that we could say that we have to change the emphasis. I certainly agree with you as I think everyone else does here the Mr. the merchant marine and fisheries are going down. We have to stop T this. The attitude of the administration, and I wouldn't care wh0. T political philosophy it happened to follow, just simply isn't oriented properly as far as the merchant marine or our commercial fisheries STAT I think something must be done and it is time that we use all the presure we can to force the administration to properly recognize the importance of the merchant marine and the fisheries of the world Mr I want to again congratulate you on your posture. I think your state M ment was excellent. Thank you very much. The CHAIRMAN. I think counsel, Mr. Drewry, has a question or two to ask. Mr. DREWRY. Mr. Leggett, on page 2 of your statement I think! want to get my own understanding cleared up as to what you mean i the next-to-the-last paragraph: At the insistence of my Armed Services Committee, Secretary Nitze nounced a few weeks ago that Kaiser Industries would shortly complete five-to-seven year $600 or $700 million Naval ship modernization program. Mr. LEGGETT. That is a study. Mr. DREWRY. I wondered whether you meant ship modernization or shipyards Mr. LEGGETT. That is right, shipyard. Mr. DREWRY. By "complete study" you mean the complete arrange ment for it, is that right? Mr. LEGGETT. That is true. We anticipate that the first increment of that $500 or $700 million program will be in the 1969 budget. We have been led to believe that. Mr. DREWRY. That is to modernize the shipyard to overcome the ver thing that the Secretary has been talking about in the past. Right alon the same line there have been frequent comments about how importa private yards are. I know that you are close to the activities in your private yard on the west coast. What are they doing out there to modernize their capability for merchant shipbuilding! Mr. LEGGETT. I think we found out that all we need are contrac If we have proper contracts and proper awards private industry w find ways in which to improve their capability. We did that down in San Diego with National Steel, a subsidiary of Kaiser Industries. Ther have engaged in some modernization down there. We did the sar thing down in the gulf with Litton at Pascagoula. We have had som modernization down there. Both of these shipbuilding entities have received contracts. One re ceived 15 or 20 or 25 LST's and the other got a large number of DES When we have these multiple contracts there are funds there to do the job, but we don't do it on 13 ships a year for an entire Nation. Mr. DREWRY. They are perfectly happy to go along with these aspectof the FDL program that so much was made of the multiyear procu ment and series production. The private yards are perfectly happy go along with that type of procedure, are they not? Mr. LEGGETT. Surely, as long as it is put out to competitive bids. Mr. DREWRY. And to gear up in whatever way is necessary in or to do it provided they can see the business coming. That is all, M: Chairman. Mr. DOWNING (presiding). Thank you very much. The next witness this morning is our colleague, Congressman Robert O. Tiernan. It is a pleasure to have you, Mr. Tiernan. STATEMENT OF HON. ROBERT O. TIERNAN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF RHODE ISLAND Mr. TIERNAN. Thank you, Mr. Chairman. Mr. Chairman and members of the committee, as one of the more than 100 Congressmen who have introduced bills for the creation of an independent maritime agency, I am pleased to testify before you in support of H.R. 159 and its companion bills. There is no need for me to cite today the tragic figures underlining the decline of the American merchant marine. I think it has been amply taken care of by our colleague, Congressman Leggett, the previous speaker, but I think, gentlemen, the time has clearly come when Congress must examine the position of the United States in the world geographically, economically, politically, and scientifically to determine if indeed we need an American merchant marine, and if so, how best to effect its resurrection. If we pause to recall our schooling, most of us will remember learning geography largely with the aid of flat maps, usually using what is called the Mercator projections. Unfortunately, these maps distort the size of landmasses at the higher altitudes and fail to reflect the true global and oceanic nature of our world. It is necessary to turn to a globe to gain a true picture of the earth and that picture reveals to us that three-quarters of our planet is covered with water. It also underlines the sometimes startling fact that the continent of North America is an island. Indeed, with the possible exception of the Eurasian landmass, all of the continents are mere islands, islands upon which the vast bulk of the population dwells within 500 miles of the sea. Any nation that seeks to influence the destiny of mankind must heed these simple geographic facts, any nation that fails to heed them does so at the peril of its own independent existence. There has been considerable speculation in this country lately on the emergence of a neoisolationism. The United States will not return to isolationism, simply because economically she cannot isolate herself from the rest of the world. Although we pride ourselves on being the world's foremost industrial giant, we are by no means a self-sufficient nation. Nearly 100 raw materials vital not only to our industrial supremacy but our very survival must be imported. These raw materials range the alphabet from antimony, bauxite and cobalt, through copper, mica and tin, all the way to zircon. Half of the raw materials produced in the free world are consumed in the United States and the vast bulk of those that must be imported must be moved by ship. A great number of the raw materials which we must import come from the newly emergent nations of Africa, Asia, and Latin America. Many of these nations are in turn dependent upon us for a steady supply of agricultural products, a dependency which seems destined to increase. As Agriculture Secretary Freeman stated in his article "Malthus, Marx, and the North American Breadbasket" in the Foreign Affairs 83-195-67- -25 |