Had I prepared a statement, which I unfortunately didn't have time to do for reasons that I think you are aware of, I would have repeated much of what people have said so eloquently here this morning. Though I didn't do that, there are one or two points I would like to mention.

Before doing that, however, I will advert to Mr. Kibre's suggestion with respect to the limitation on the eligibility for crews on these boats and point out that Puerto Rico is a part of the United States, and therefore, people in Puerto Rico have as much right for the opportunity to fish on these boats as do others.

In the long run, it will be discovered that the San Pedro fishermen and the San Diego fishermen probably will get the berths on the boats by virtue of their superior skill and ability.

One of the reasons why Puerto Rican fishermen are sometimes hired, and for that matter fishermen of other nationalities presently, is because it is so important in the entire tuna operation that the skippers and others have to resort to every means they can in order to stay alive in business.

It has been pointed out that the tuna industry has become reasonably competitive with the Japanese. This is true. We are not equal at the moment. We are holding our own. We have certainly managed in the past 4 years at least to sell most of the fish that our fleet has caught at a fair price to the processors and in turn to the

consumer.

There is one thing Senator Magnuson referred to, I believe, recently that might have some interest here. We are gradually running out of arable land here in the United States, and we have water problems in many areas. We may find ourselves in the position where animal protein of the type normally produced on the land will be inadequate for our needs. This isn't the case today but it may very well be in the years ahead. And the sea will still be one of the areas from which we can get very adequate sources of animal protein, of a very high biological value, by the way.

Therefore, this should be considered in every effort to foster and enlarge and encourage our fishery operation in the United States. This bill I consider just one more step in a program to implement the statement of objectives contained in the Fish and Wildlife Act of 1956. The statement of objectives there is a very worthy one but unfortunately has been implemented piecemeal and largely simply because the Federal Government has not been able to provide the funds necessary to implement the policy more completely.

Those are about all the remarks I have at this time, Senator. I will answer any questions you might have, however.

Senator BARTLETT. Thank you, Mr. Carry. I really don't have any questions.

Mr. CARRY. Thank you, Senator.

Senator BARTLETT. Mr. Fulham, we are glad to have you here.

STATEMENT OF THOMAS A. FULHAM, FULHAM BROS., INC., BOSTON, MASS.; VICE PRESIDENT, BOSTON FISH MARKET CORP.; PRESIDENT, BOSTON FISHING BOAT CO., INC.

Mr. FULHAM. Thank you, Mr. Chairman.

I am Thomas A. Fulham, of the Fulham Bros. fish company in Boston. Also I am vice president of the Boston Fish Market Corp., which is the organization that operates the fishery in Boston; and also, I am president of the Boston Fishing Boat Co., Inc.

The passage of Public Law 86-516 86th Congress in June 1960 was a most significant step in the development of a fishery policy for the United States, but the the impact intended for that legislation unfortunately fell far short.

The need in the port of Boston was for 15 trawlers of improved design and that need still exists.

The present 333 percent subsidy bill was productive of but two steel trawlers and these were built from existing, conventional designs. On December 3, 1962, the 124-foot trawler Massachusetts entered the fishery much heralded by press, radio, and television. The fact that anyone had the audacity to build a trawler seemed to capture the public fancy and headlines ran the gamut from "Small Effort" to "Answer to the Red Threat." Most likely, the public notice was prompted by the fact that this was the first new construction in the obsolete fleet in 14 years. In all respects, she is an excellent vessel, built from a proven design, constructed of improved materials and modernized machinery. Her sole purpose is to catch 3,500,000 pounds of fish annually and pay off her $224,000 debt. There is nothing new or exciting, nor are there any unique features which will enhance our national prestige or aid us in assuming a proud posture among the fishing nations of the world. In short, to do that would have been so costly that the project would never have gotten off the ground. She is a vessel launched by cooperative desperation.

Let me illustrate: The Boston Fishing Boat Co., Inc., the owner of the vessel, is a company formed by 29 stockholders from among fish dealers, cold storage operators, oil suppliers, gear and equipment suppliers, restaurant owners, mechanics and related tradesmen who felt they had to do something about the fleet. Cash investment ranged from $500 to $14,000, all paid in with the hope that there would be a return, but no assurance that there could be. None of the customary legal fees, travel, office expense, management, or promotional expenses were paid.

The vessel design, which is normally a significant percentage of the cost, was provided at no cost. Even the shipyard owner was persuaded to build a sister ship for a company in which it had an interest to lessen further the costs of construction. I doubt seriously if any group in the country could duplicate the cost control exercised in this venture. We know for certain that the nearest competitive bid

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was $140,000 higher than her final cost. Even with the Government guaranteed loan, it was necessary to eliminate all executive salaries in order to secure financing. This the group was willing to do. It is doubtful if her total management costs for 1963 will exceed $5,100.

I am quoting the origins and experiences of the Boston Fishing Boat Co. for two purposes: The first purpose is to demonstrate that if anyone feels that a U.S. trawl fishery can be developed on a onethird subsidy merely because a steel trawler was, in fact, built; then he should disabuse himself of the notion immediately. People work and invest because they anticipate a wage or return on their investment. The people who nurtured the Massachusetts received no wage and its stockholders are hoping, but do not anticipate a return on their investment. My second purpose is to demonstrate that modern design, progressive new methods and conditions that will attract both fishermen and capital investment to our fishery are not possible within the framework of a one-third construction subsidy.

Currently, with the struggle to do something about our fleet, we must also consider what is happening to our shore processing facilities. The steady decrease in landed raw materials makes it increasingly more difficult for processors to modernize facilities, train new personnel or expand their abilities to handle fresh fish. Unlike a boat program, which can be expanded for the most part with innoculations of capital, this phase of our industry cannot recapture its markets with similar aid. Once a customer is lost, either to a foreign processor or to another food product, the cost of recapturing him in time and money is too costly to undertake. There can be no delays if we are going to head off this attrition.

S. 1006 is an excellent bill and deserves the support of the entire industry. It not only equates some of the inequities of the old legislation by expanding the coverage but it requires that new and unique solutions be devised for age-old problems.

It is not enough for the Government to pick up a portion of the bill merely to aid survival. It has a right to require that the beneficiaries of this subsidy rouse themselves to seek new, interesting, and advantageous methods to compete in world fishing.

I wish to be recorded in favor of this bill.

Thank you, Mr. Chairman.

Senator BARTLETT. Thank you very much, Mr. Fulham. You have made a very important point, at the end of your statement, that everything isn't achieved when the vessel is built under this bill that becomes law.

It is up to everyone concerned to keep pressing ahead.

Mr. FULHAM. We have 15 years to prove that we can do it, Mr. Chairman.

Senator BARTLETT. Thank you very much.

Mr. FULHAM. Thank you, Mr. Chairman.

Senator BARTLETT. Mayor O'Maley, accompanied by Mr. Lewis and Mr Silva.

STATEMENT OF HON. RALPH B. O'MALEY, MAYOR OF GLOUCESTER, CITY HALL, GLOUCESTER, MASS.; ACCOMPANIED BY MANUEL F. LEWIS, EXECUTIVE SECRETARY, GLOUCESTER FISHERIES COMMISSION, CITY HALL, GLOUCESTER, MASS.; AND JOHN G. SILVA, BUSINESS AGENT, GLOUCESTER SEAFOOD WORKERS UNION, GLOUCESTER, MASS.

Mayor O'MALEY. I am Ralph B. O'Maley. I am the mayor of the city of Gloucester. I appear before this committee not only in my capacity as mayor but also as chairman of the Gloucester Fisheries Commission and as a representative of the Gloucester City Council, which latter body has directed me by formal resolution to appear before this committee on behalf of the vessel subsidy bill. More specifically, gentlemen, the Gloucester City Council has instructed me to place them on record endorsing this legislation.

The city of Gloucester relys on its fishing industry. This commerce has been traditional and primary in the city of Gloucester since its settlement in 1623. The competition from imported fish shipped from Iceland, Canada, Norway, Denmark and other countries makes it impossible for our fishermen and fishing boatowners to survive. The comparative wages in these countries and in our United States need not be called to your attention.

This difficulty applies not only to the seamen, processors, and maintenance crews. It applies equally to the cost of construction to replace the aging vessels presently comprising our fishing fleet. Mr. Lewis, the executive secretary for the Gloucester Fisheries Commission, points this out in detail in his statement. The rapid decline in numbers of this fleet, as a result of shipwreck, sinkings, and other maritime disasters, has also been cataloged by Mr. Lewis for your committee. Unless these vessels are replaced, the domestic fishing business will become extinct. With the extinction of this traditional and primary industry, the city of Gloucester faces an economic plight for which no solution appears. Over 70 percent of the wage earners in this city depend upon the proceeds of the domestic fishing industry for their livelihood. No greater evidence of the presently serious state of our economy need be shown than the official designation of the Gloucester area as a distressed area, under the recent Federal Redevelopment Act, with all its attendant implications.

With the present cost of construction, it is impossible to profitably invest in the construction of a fishing vessel in his country. Under present Federal Law, it is forbidden to engage in commercial fishing with a vessel constructed on foreign soil.

Being unable by the law of the land to construct a fishing vessel on foreign soil, being unable by the law of economics to construct a fishing vessel for profitable operation in a domestic shipyard, and faced with the certain probability of financial distress and impoverishment as a community, I, as mayor of the city of Gloucester, as chairman of

the Gloucester Fisheries Commission, and for and on behalf of the city council of this city, plead with you, Mr. Chairman and gentlemen, to help us by the enactment of this bill. Thank you.

Senator BARTLETT. Mayor O'Maley, when, if you know, did the foreign competition to which you referred first have a serious impact? Mayor O'MALEY. I don't have that information. We have it cataloged by Mr. Lewis, who is our executive secretary. Can you answer that question?

Mr. LEWIS. I would say shortly after the war.

Senator BARTLETT. Your position, as I inferred, Mr. Mayor, is that the bill would not do everything that needed to be done, but it would help?

Mayor O'MALEY. It would be a step in the right direction, as far as the city of Gloucester is concerned. It would help replace our depleted fishing fleet. I think we have lost almost three-fourths of the fleet since World War II.

Because of the high cost of construction, there doesn't seem to be any risk capital available to replace the fishing fleet. This has had a serious effect on the city of Gloucester.

Senator BARTLETT. The Subcommittee is grateful to you for having come down here to testify, Mr. Mayor.

Mayor O'MALEY. Thank you.

Senator BARTLETT. Mr. Lewis?

STATEMENT OF MANUEL F. LEWIS, EXECUTIVE SECRETARY, GLOUCESTER FISHERIES COMMISSION, GLOUCESTER, MASS.

Mr. LEWIS. Mr. Chairman, I submitted my statement to you. I would just briefly summarize, because I wouldn't want to be repetitious in some of the remarks that have already been made.

(The prepared statement follows:)

STATEMENT OF MANUEL F. LEWIS, EXECUTIVE SECRETARY, GLOUCESTER FISHERIES COMMISSION, GLOUCESTER, MASS.

Gentlemen, my name is Manuel F. Lewis, executive secretary for the Gloucester Fisheries Commission, a municipal agency of the city of Gloucester under authority granted by the Legislature of the Commonwealth of Massachusetts. It was organized to promote the welfare of the fishing industry, so the entire citizenry of Gloucester will benefit. Its members are representative of the entire Gloucester community and the fishing industry; therefore, it speaks for the vessel owners, fishermen, the processors, their employees, and all people engaged in allied trades.

In speaking for this legislation, I must point out to you the serious situation of the Gloucester fishing fleet: Numbering some 400 vessels in 1943, now some 20 years later it numbers approximately 150 vessels, of which 75 percent are old, outmoded ships with 20 years or more of service behind them. Can we expect this type of vessel to compete with the modern Soviet and Japanese fishing vessel? Having spent close to 30 years of my life in this industry, I know the answer and I am sure that you do, too. I am sure, also, that every member of this committee has heard of the great invasion of the Soviet fishing fleet in waters traditionally fished only by the U.S. fishing fleet, though a few Canadian trawlers have also fished this area. Gentlemen, in 1962 a peak of 160 Soviet fishing vessels and factory ships were observed on these same banks, not too many miles from our shores-a fleet that subjects one's own to humiliation, by their size, age, and equipment of the most modern type. Yes, gentlemen, it has been reported that there is more equipment on these Soviet ships than is necessary for the fishing of these grounds. Again, I am sure you know more than I, as far as that subject goes.