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(The communications and statement referred to are as follows:)

NATIONAL UNION OF MARINE COOKS AND STEWARDS,
Washington, D. C., January 25, 1949.

Hon. SCHUYLER O. BLAND,

Chairman, Committee on Merchant Marine and Fisheries,

House of Representatives, Washington, D. C.

DEAR CONGRESSMAN BLAND: I had planned to be present at the hearings of the House Committee on Merchant Marine and Fisheries this morning to appear on behalf of the National Union of Marine Cooks and Stewards, CIO, in complete support of your bill, H. R. 1340. Unfortunately, urgent business has required my leaving the city.

I am enclosing a copy of my prepared statement, which I hope will be included in the record of the Committee and printed in the hearings on this bill. Very truly yours,

WILLIAM GLAZIER, Washington Representative.

STATEMENT OF THE NATIONAL UNION OF MARINE COOKS AND STEWARDS BEFORE THE HOUSE MERCHANT MARINE AND FISHERIES COMMITTEE IN SUPPORT OF H. R. 1340 AND S. 591.

The National Union of Marine Cooks and Stewards, a maritime union affiliated to the Congress of Industrial Organizations, is vitally concerned about the steady decline that has taken place in the United States merchant fleet since the end of World War II. Over the past 2 years all of the members of our union have been increasingly convinced that some governmental action is required to stabilize the maritime industry; the initial postwar boom in shipping dried up quickly to be replaced by steadily decreasing employment opportunities for our own members and, in fact, for all American seamen and shore-side maritime workers.

For some time past the distressed condition of the American merchant fleet has meant fewer and fewer jobs for American seamen. New ship construction has been at a minimum. And both intercoastal and coastwise shipping have been reduced to the barest minimum. At the same time, an increasing volume of the offshore shipping has continued to be diverted to foreign bottoms. This trend has been accentuated by the sales and transfers of United States bottoms to companies operating under Panamanian and Honduran flags-a policy which we have protested vigorously since many of these so-called foreign operators have in fact the closest corporate ties to certain American ship operators. These transfers, stepped up since the war, have become a regular policy in certain American and European ship owners and operators for the purpose of evading taxes, currency regulations, safety, and labor standards. All of these developments have sharply reduced the number of United States-flag vessels in active operation-and with this the employment opportunities for American seamen. Superimposed on this distressing situation-and we hope that the committee plans to hold exhaustive hearings in the near future on all of these many maritime problems, at which time we would like to testify in greater detail-has come the recent policy announcements of ECA Administrator Hoffman.

As you know, the original version of the legislation enacting the European recovery program provided for the sale and/or transfer of some 500 vessels to foreign maritime countries. This proposal was never put into law. In its place the Congress enacted section 111 (a) (2) which reads as follows:

"Processing, storing, transporting, and repairing any commodities, or performing any other services with respect to a participating country which he determines to be required for accomplishing the purposes of this title. The Administrator shall, in providing for the procurement of commodities under authority of this title, take such steps as may be necessary to assure, so far as is practicable, that at least 50 per centum of the gross tonnage of commodities, procured within the United States out of funds made available under this title and transported abroad on ocean vessels, is so transported on United States-flag vessels to the extent such vessels are available at market rates."

It was our understanding--and we think the Senate debate bears this outthat the intent of Congress in enacting this section was to require that at least 50 percent of the commodities purchased in the United States for participating countries be transported in United States bottoms.

We need not detail the construction that was put on this section by ECA Administrator Hoffman. His announcement on December 1, 1948, that after December 31, 1948, ECA would not apply this provision to bulk cargo shipments threw the entire maritime industry into a turmoil.

The contention of ECA that a $4.50-ton differential exists between United States and foreign tramp rates for moving coal over the North Atlantic simply cannot be supported by facts. More than that, it is our conviction that even if some differential can be shown to exist between the rates on United States and foreign tramps, this is irrelevant as far as the provisions of this particular law are concerned.

Administrator Hoffman agreed to postpone the application of his order to January 31, and subsequently agreed again to a postponement for another 60 days.

We appear here today to urge that the committee report out H. R. 1340 favorably and as soon as possible. We also urge the speediest congressional passage of this bill. So long as the ECA interpretation continues to hang over the maritime industry—even though the application is postponed-few private American ship owners will venture into bulk shipping for fear that the ECA will suddenly implement its interpretation and cut the bottom out of United States participation in the traffic.

We are particularly anxious that this problem be speedily disposed of along the lines indicated in H. R. 1340 and that this committee and the Senate Committee on Interstate and Foreign Commerce then concern themselves with the enactment of legislation attacking the more fundamental crisis afflicting the American maritime iindustry.

Hon. SCHUYLER O. BLAND,

UNITED STATES CHAMBER OF COMMERCE,
DEPARTMENT OF GOVERNMENTAL AFFAIRS,
Washington, D. C., January 24, 1949.

Chairman, Merchant Marine and Fisheries Committee,

House of Representatives, Washington 25, D. C.

DEAR CONGRESSMAN BLAND: The Chamber of Commerce of the United States approves of the principle involved in the bill H. R. 1340, which provides that at least 50 percent of all dry-cargo tonnage purchased with United States Government funds, or procured under Government credits, for the benefit of foreign nations shall be transported in American-flag vessels when such vessels are available at market rates.

To assure that it is the intent of Congress that the American merchant marine shall properly participate in shipments under foreign-aid programs, the chamber believes that existing law should be clarified to accomplish the purposes of H. R. 1340 and, further, that it should be made explicit, as provided in the bill, that "market rates” means market rates for vessels operated under American standards and costs.

We should appreciate your committee's consideration of these views and hope that this letter may be incorporated in the record of the hearings on H. R. 1340. Cordially yours,

CLARENCE R. MILES.

The CHAIRMAN. Thank you very much for your full attendance at these hearings.

(The committee adjourned at 11:25 a. m., to reconvene on Thursday, February 3, 1949, at 10 a. m.)

SALE, CHARTER, AND OPERATION OF VESSELS

THURSDAY, FEBRUARY 3, 1949

HOUSE OF REPRESENTATIVES,

COMMITTEE ON THE MERCHANT MARINE AND FISHERIES,

Washington, D. C. The committee met, pursuant to adjournment on Thursday, January 27, 1949, at 10 a. m. in the committee hearing room, Old House Office Building, the Honorable Schuyler Otis Bland, chairman, presiding.

The CHAIRMAN. The committee will come to order.

I am very sorry to have to announce that Mr. Bennett of Florida, a member of the committee, suffered the misfortune of breaking his ankle or foot in slipping on the ice. He is in the hospital, and they hope he will be out in a very few days. We will send him, from the committee, our greetings and an expression of sympathy and best wishes.

We have met this morning to continue the hearings on H. R. 1340, and specifically for the purpose of hearing Mr. Hoffman. Is he present?

Mr. WALLACE BASSFORD (Economic Cooperation Administration). Mr. Hoffman will be here about 10:30. I think that is the hour he was supposed to be here.

The CHAIRMAN. We will go on until 12. Then we will have to adjourn. If for any reason we desire to go on this afternoon, I think we can safely do it.

Mr. MEADE. Since Mr. Hoffman is not here, may I offer for the record three or four communications that the committee has received, one from the Windsor Navigation Co., of New York, with respect to H. R. 1340, and a telegram from Harry Lundeberg, secretary-treasurer of the Sailors Union of the Pacific and president of the Seafarers International Union of North American with respect to House Joint Resolution 92, in favor of it; and also a letter from the international trade section of the New York Board of Trade with respect to H. R. 1340 and a letter from the office of Paul V. McNutt with respect to H. R. 1340.

The CHAIRMAN. I wonder if it would be of any advantage for you to read those to the members of the committee.

Mr. MEADE. Some of them are quite lengthy, and all of them are in favor of either 1340 or 92, the bills which I mentioned when I offered the letters. The one from Paul V. McNutt I have copies of for each member of the committee, and that is with reference to an amendment which they request with respect to 50 percent of the insurance being carried by America insurance companies in connection with the 50 percent of goods carried by American ships. It is quite a lengthy

letter. I think it would be better just to distribute it to the members of the committee.

There is one more letter from the Pacific Far East Co. which Mr. Allen has received, and I would like to offer it for the record.

The CHAIRMAN. Very well. They will be incorporated in the record. Have you copies to pass around?

Mr. MEADE. NO. There is just this one copy except for the McNutt

letter.

(The communications referred to are as follows:)

The Honorable S. O. BLAND,

WINDSOR NAVIGATION CO., INC.,
New York 1, N. Y., January 31, 1949.

Chairman, Merchant Marine and Fisheries Committee,

House of Representatives, Washington, D. C.

DEAR JUDGE BLAND: As the owners of two American-flag Liberty tankers, purchased from the United States Maritime Commission in 1947 and 1948, we are watching with profound interest the progress of your bill, H. R. 1340, relating to participation by American vessels in the carrying of Government-financed cargoes.

The various independent owners of United States-flag tankers have, as you know, been in a precarious position since the collapse of the tanker market early last year. In our case, we have been unable to find continuous employment for our vessels and they were both laid up for several months in 1948. Such business as can now be had brings rates substantially below the Maritime Commission rates established several years ago. At the moment, we are planning to stretch the employment of one ship by carrying distillery slops out to sea for disposal. Even so, we are more fortunate than some American tanker owners, who are reported to have vessels idle right now, in the dead of winter.

We presume your committee has before it statistics on the employed and idle periods of private United States tankers during the past year. If not, we should be pleased to provide such data with respect to our own vessels, and we are confident that other independent owners would be equally willing to cooperate.

We have hoped, from day to day, that the fifty-odd Maritime Commission tankers, on loan to the Navy Department to relieve the latter from dependence upon the chartering of private vessels, would be redelivered into lay-up. Naturally, this elimination of Government competition would be of great assistance to tanker owners, but unfortunately there seems to be no indication as to when it might come to pass.

In this gloomy situation, the appearance of H. R. 1340 has brought new hope to us and, undoubtedly, to every other independent tanker owner. To date, those provisions of the Economic Cooperation Act relating to the participation of American vessels, apparently have been applied only to tanker cargoes originating in this country. As a result, American tankers have increasingly been denied business in the important cross trades, even though independent operators have demonstrated that American vessels, with American crews, can be used successfully and competitively in the Persian Gulf-Europe service. Accordingly, we should like to go on record as heartily in favor of H. R. 1340, and hope that its provisions which would secure a share of Government-financed cargoes to American tankers, remain unchanged.

In this connection, however, we are alarmed by rumors that a segment of the shipping industry desires the removal of tankers from the provisions of the bill. We realize, of course, that our views may differ from those of operators who own considerable fleets under foreign flags, and appear in the market principally in the role of charterers. However, we believe that all independent tanker owners will agree that deletion of the word "tanker" from H. R. 1340, would be a devastating blow to their businesses, and to the thousands of American seamen they employ. We hope, therefore, that in considering statements from members or representatives of the industry, the views of the various independents will be specifically obtained. Inasmuch as an impressive proportion of the tanker fleet is owned by companies which are not solely shipowners, we are most anxious that the position of the independents not be overlooked, nor assumed to be covered by statements from associations appearing to speak on. behalf of the industry as a whole.

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