Five senators seek help for maritime industry Legislation filed to create panel

August 11, 1993|By Suzanne Wooton | Suzanne Wooton,Staff Writer

The nation's maritime industry faces no less a crisis than its airlines, say five Democratic senators who want a new business and government panel to investigate reviving the industry.

The senators said yesterday that they had introduced legislation to create the panel, which would be appointed by President Clinton. That move was prompted by recent applications of the two largest U.S. shippers' to reflag much of their fleet in foreign countries. Sea-Land Service Inc. and American President Companies hope to avoid tough U.S. regulations, taxes and high labor costs.

"To allow the U.S. maritime industry to go belly-up and to reflag its fleet under foreign flags would be a monument to shortsightedness and just plain stupid," South Carolina Sen. Ernest F. Hollings said. In calling for the panel, he was joined by

Maryland Sen. Barbara A. Mikulski, Sen. John B. Breaux of Louisiana, Sen. Charles S. Robb of Virginia and Sen. John Kerry of Massachusetts.

Ports are vital to the economies of all five states, providing thousands of jobs for freight forwarders, tugboat operators, longshoremen and others. The Port of Baltimore, for example, is worth $1.2 billion to Maryland's economy annually and provides 13,000 jobs directly and indirectly, according to the state.

Because of the higher cost of operating vessels flagged in the United States, only a handful of companies remain here. Since 1970, the number of U.S.-flag vessels has plummeted to 350, from 840; the number of jobs for seamen has dropped to 9,165, from 40,248.

Shipping companies, like airlines, face problems stemming from a prolonged recession, consolidation and international competition. Both suffer from overcapacity.

Sen. Hollings and others argue that further erosion would threaten national security. During war and international conflicts, commercial ships, crewed by merchant marines, carry supplies and weapons.

Sea-Land and other shippers have been pushing for increased subsidies in the form of a payment per vessel, in exchange for making ships available to the U.S. military. The industry says it needs about $5 billion in subsidies and tax breaks over the next 15 years.

Currently, Sea-Land, a division of CSX Corp., serves Baltimore; American President does not. Reflagging, which would mean the loss of 900 American jobs, would have no immediate impact here, according to state officials. If Sea-Land reflags, however, its vessels leaving Baltimore and other U.S. ports, could not by law carry military arms.

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