1 Includes related idleness, seamen strikers only, approximately 70,000.

2 MEBA picketing caused some dislocations in American Export operations of former Isbrandtsen ships and also some AEL ships. No loss in shipboard employment; approximately 300 longshoremen affected along several Brooklyn piers for sporadic periods. 3 Indefinite.

5 МЕВА.

• To date.

1 MMP/ARA.

Source: Maritime Administration.

4 Varied.

The longshore strike commenced January 11, 1965, affecting all Atlantic and Gulf ports. The settlement of local agreements caused longshore activity to be resumed on various dates during February and March.

Source: Maritime Administration, Office of Statistics, Division of Labor Data.

Senator LAUSCHE. I understand that. But you are interested in keeping our flagships sailing; aren't you?

Admiral HARLLEE. We are, absolutely.

Senator LAUSCHE. Do you have an opinion as to whether or not those repeated shutdowns place our merchant marine at a disadvantage with the foreign-flag carriers?

Admiral HARLLEE. That is a question to which there can only be one answer, Senator. However, there are other sides to a question like that. The answer is that naturally it hurts the American merchant marine, but the question is, on the other hand, whether or not the strikes from the labor union's point of view are justified and warranted, and that question has gotten attention repeatedly from the President himself.

The President appointed Senator Morse, on one occasion, in the matter of a longshoreman's strike, and two other mediators to settle a strike-it has been a matter that has affected the national interest.

Of course, it hurts to shut the merchant marine down, but the question is whether the labor unions are justified and whether the demands are justified.

Senator LAUSCHE. One of your primary functions is to promote the growth of our merchant marine; is that correct?

Admiral HARLLEE. No; that is not correct, Senator. Our primary function is to prevent discrimination in any, unjust and unfair discrimination in any way, shape or form in our trade and commerce. In other words, American trade and commerce is our primary function. The promotion of the American merchant marine was deliberately, definitely, and positively cut off into the Maritime Administration of the Department of Commerce. And the regulatory functions, which have to do with trade and commerce, were separated and assigned to the Federal Maritime Commission in Reorganization Plan 7 of 1961. There was a definite separation, because when those two functions were together, the exporter, the importer, the consumer, often suffered. So there was a separation. But we are interested in the promotion of the American merchant marine, insofar as it helps American trade and commerce. Insofar as representation in the steamship conferences, insofar as services to Alaska, Hawaii, Puerto Rico, are concerned for example. That is the part we are interested in.

Therefore, we are interested in the promotion of it, but—

Senator LAUSCHE. We can stop right there. You are interested in the promotion of the merchant marine, carrying the American flag? Admrial HARLLEE. Insofar as it helps the trade and commerce of the United States.

Senator LAUSCHE. And being interested in the promotion of the growth of the merchant marine, you are incidentally interested in the promotion of commerce, aren't you?

Admiral HARLLEE. Yes, Senator, we are, but not just incidentally. Senator LAUSCHE. Now this question: Has our competitive position grown better or worse under the present program and operation of the U.S. merchant marine?

Admiral HARLLEE. Over which period of years do you have in mind?

Senator LAUSCHE. Over the last 10 years.

Admrial HARLLEE. Over the last 10 years the competitive position, overall, of course, has definitely gotten worse.

Senator LAUSCHE. To what do you attribute that?

Admiral HARLLEE. Well, it is attributed naturally to foreign competition.

Senator LAUSCHE. And that means that our ability to compete with the foreign carriers has grown worse in the last 10 years?

Admiral HARLLEE. It has; yes.

Senator LAUSCHE. And that is in spite of the fact that we subsidize the building of the ships, and subsidize the operation of them?

Admiral HARLLEE. Senator, it is not possible to accurately categorize the situation in such a manner. There are several parts of the American merchant marine. There is the part which is subsidized, the liners which handle the general package cargo, and that part of the American merchant marine over the past 10 years has fairly well held its own. That is the primary part we regulate.

The domestic carriers over the past 10 years haven't done so badly either. They are undergoing somewhat of a resurgence in the last couple of years.

But the parts which have gone down, the parts which have had the most and greatest difficulty are the tramps and the bulk carriers. These are the parts where the ships are aging, as in the case of tramps. into 20 or 25 or 30 years, and the parts in the case of bulk carriers that are being put under foreign flags, to the tune of about 453 ships.

So the overall carriage of cargo has gone down to 9 percent. But the parts we regulate, the part that is subsidized, the liner part, has fairly well held its own.

Senator LAUSCHE. That is the subsidization program, you say, has pretty well held its own?

Admiral HARLLEE. For the most part that is the subsidized, yes. Senator LAUSCHE. Do you know that because of the inability to compete with foreign builders, we had to lift the ceiling on subsidies in building from 50 to 55 percent maximum?

Admiral HARLLEE. Yes, Senator.

Senator LAUSCHE. Now then if we had to lift the subsidy to 55 percent, does that mean we have held our own?

Admiral HARLLEE. Well, you are talking about shipbuilding now, Senator.

Senator LAUSCHE. I am talking of both.

Admiral HARLEE. Well, shipbuilding, Senator Bartlett brought up the point earlier, that those subsidies go to the shipbuilders, not to the ship operators.

Senator LAUSCHE. It is the taxpayer's money, whether it goes to the operators or builders. It is supplied for the purpose of helping our competitive situation.

Admiral HARLLEE. Yes, sir; in shipbuilding.

Senator LAUSCHE. But it hasn't helped, it has grown worse, and as evidenced by the fact that we are now paying 55 percent, whereas in the past there was a 50-percent limitation. I observe that you don't dare talk much about this issue. You seem to be a little bit hesitant about talking about this delicate issue.

Admiral HARLLEE. Which issue do you mean, Senator?

Senator LAUSCHE. Well, this matter of strikes in the merchant marine.

Admiral HARLLEE. Yes, I very definitely feel it is a delicate matter. And the reason I do, Senator, is because it is a matter which should be properly decided and is being decided, should be decided at the bargaining table, with the Government coming in, if necessary. Now the judge of whether it is necessary for the Government to come in is not the Federal Maritime Commission. The judge of whether it is necessary for the Government to come in starts off, perhaps, somewhere around the Maritime Administrator, goes to the Secretary of Commerce, to the Secretary of Labor, and then to the President of the United States. This is a matter which would be highly improper for me to make offhand or strong personal opinions on, because they might be in conflict with the opinions of the people that have the responsibility for it, and I want to stress that the Federal Maritime Commission has no jurisdiction in labor disputes.

Senator LAUSCHE. Yes, I understand that.

Admiral HARLLEE. I don't want to say one thing and then have the President or the Secretary of Labor come down and say something else. That isn't the proper thing to do.

Senator LAUSCHE. In conclusion, my concern is that the Government is putting up a substantial sum of money to help build the merchant marine, and therefore the Government ought to have a pretty deep interest in seeing what is happening through the developments in either improving or worsening our competitive position in the selling of the carrier business to the shippers of the world. And I think we are getting worse and worse, and nobody seems to care about it. Everybody is scared to death to speak up on the subject.

Admiral HARLLEE. Senator Lausche, I accept your statement, I agree with everything you have said absolutely. But I am sure you will agree if you have a half dozen different parts of the executive branch of the Government going around voicing different opinions on this matter, this strike, you would have a chaotic and confusing situation. I am sure you expect the views and the actions of the executive part of the Federal Government to be coordinated in one place.

Senator LAUSCHE. I think you are taking the sound position about what your Commission is allowed to do. My questions were put to you to get information, and I think I have gotten whatever information I

want.

Admiral HARLLEE. I will furnish the rest for the record, Senator. The CHAIRMAN. Well, I don't know who is speaking out, but I think the chairman and the Senator from Alaska and the Senator from Maryland talked a great deal about this subject. But I am glad the Senator from Ohio asked those questions because too many people misunderstand, one, the duties of the Maritime Commission, which I am going to put in the record, and two, that when we talk about the maritime, we are talking about the subsidized part of it, and the tramps, and the bulk carriers and the intercoastal and also the domestic, which make up the whole.

I agree with you that the subsidized liner operations-I wish it was doing more, but it has been holding its own. The other, the part that is not subsidized, is where our big problem in the future and now exists, in the bulk and tramps. And part of this is because during the warand this points up again the fact that we need a merchant marine, an adequate one, even if we have to subsidize it, because it is the fourth arm of defense. We found that out in World War II, so we built a lot of tramps, a lot of ships; we had to. They are now out trying to compete with foreign competition and they haven't been able to. And they are not subsidized.

Senator LAUSCHE. That is where I come in right there.

The CHAIRMAN. They are not subsidized and it is not the taxpayers' money. A lot of them have been forced-I don't know whether they are forced or not, but they have gone to foreign flags. And this points up again the necessity of an adequate merchant marine as the fourth arm of defense.

We found in World War II the merchant marine, I think, carried something like 90 percent-plus of the bulk cargo carried to all of our forces overseas. Again the law is there, and

Senator LAUSCHE. Well, may I say that when the Merchant Marine Act was passed, it was argued that we need a merchant marine, and to have a merchant marine you must subsidize. I think it was in 1934 it was said we will subsidize the building in an amount not to exceed 50 percent. In the course of time, they said, our competitive position