Maritime panel member urges deregulation of industry

October 18, 1990|By John H. Gormley Jr.

Donald Robert Quartel, a member of the Federal Maritime Commission, called yesterday for a sweeping deregulation of the U.S. maritime industry through the substitution of market forces for the protectionism that now shields steamship lines and shipyards from foreign competition.

"The heart of our maritime policy has been protectionism," Mr. Quartel said at a conference in Baltimore on the globalization of trade and transportation. As examples of protectionist policy, he cited subsidies paid to operators of U.S.-flag ships to offset the higher costs of U.S. crews and rules that discourage U.S. companies from buying or repairing their vessels in foreign shipyards.

He argued that eliminating or reducing the maritime industry's protection against foreign competition would reduce federal spending, force U.S. industries to become more efficient and benefit consumers, who bear the burden of higher transportation costs.

While acknowledging that in the short term such an approach would mean the loss of jobs and the failure of many companies that could not compete in the new environment, he said the current programs have not prevented a steep decline in the industry. In the last decade, the number of seafaring jobs has been cut almost in half, and U.S.-flag ships now carry just 6 percent of U.S. trade, he said.

Mr. Quartel's proposals were dismissed as naive by defenders of maritime interests. Representative Helen Delich Bentley, R-Md.-2nd, said, "When other countries get rid of their assistance and their controls and their ship subsidies, then we'll think about it." If the United States adopted a totally free trade stance for the maritime industry, she said, "we would be giving up to foreigners what little we have left."

The suggestion that shipping lines should be free to build and repair their ships abroad brought a sharp response from David H. Klinges, vice president of maritime affairs for Bethlehem Steel Corp., which operates a shipyard at Sparrows Point.

"Trade is a negotiated proposition," he said. Mr. Quartel "seems to see the time has come for us to unilaterally disarm."

Because of foreign competition, almost no new commercial ships are being built in U.S. yards, he said, leaving commercial shipyards dependent on repairs. "That's the only thing we've got left," he said.

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