U.S. shipbreaking program needs overhaul, Gilchrest says Profit should not outweigh safety, House panel is told

March 19, 1998|By Gary Cohn | Gary Cohn,SUN STAFF

WASHINGTON -- After hearing testimony about how the shipbreaking industry harms workers and pollutes the nation's waters, the chairman of a congressional subcommittee said the government's troubled ship-scrapping program needs a complete overhaul.

Rep. Wayne T. Gilchrest, a Maryland Republican, suggested that new laws may be required to force reforms.

"It appears that there needs to be a fundamental change," said Gilchrest, chairman of the House Subcommittee on Coast Guard and Maritime Transportation. "Environmental and worker safety concerns must not be marginalized by desires to maximize profits in scrapping government ships."

The hearing came as the shipbreaking industry is under increasing pressure from lawmakers and environmentalists to comply with anti-pollution and worker-safety laws.

The scrutiny follows a series of articles in The Sun in December that documented the industry's record of deaths, accidents, fires, mishandling of asbestos and environmental violations at ports around the country. The articles also reported that the Navy and the Defense Department make no serious effort to oversee the scrapping.

At yesterday's hearing, a former Navy general counsel and an official of a recycling company suggested the government should subsidize the disposal of its obsolete ships instead of trying to make money from them.

Since 1991, as the Navy has downsized, the Defense Department has sold its old warships to private contractors, who have tried to make a profit by selling salvaged metal. But many contractors cut corners, leading to safety and environmental violations at U.S. ports, including Baltimore.

E. Grey Lewis, the former Navy general counsel, told the subcommittee that reputable companies are reluctant to get into the shipbreaking business because it is not possible to scrap ships properly and still make a profit.

"The reason that there is no viable domestic ship-scrapping industry is simply a matter of dollars and cents," Lewis said. "In general, ship scrapping or breaking is not profitable."

He added, "These ships should be looked at as problems -- not just valuable assets to be sold as they are today."

Mike Dunavant of Simsmetal America, a recycling company in Richmond, Va., said his company has lost money on shipbreaking projects.

"Simsmetal America is very interested in doing shipbreaking again," Dunavant said. "But we are a business -- we need to turn a profit. We believe as a result of our experiences that to dismantle a complete vessel in the United States, including proper remediation and appropriate safety measures, will result in a loss."

Another witness, Rep. George Miller, a California Democrat, said that shipbreaking should be viewed as an aspect of military downsizing, much like base closures, where environmental cleanup is an inevitable and costly part of the process.

"The notion that the government has to make money may be what drives some very bad practices," Miller said.

The subcommittee also heard testimony about whether U.S. government vessels should be scrapped in the Third World, where worker safety and environmental regulations are virtually nonexistent.

The Navy and the Maritime Administration, which together have about 180 ships designated for scrapping, have suspended the controversial export plan while a Defense Department panel reviews how government ships are scrapped.

Most shipbreaking overseas is done on beachfront plots in India, Pakistan and Bangladesh. In Alang, India, the largest shipbreaking center in the world, 35,000 men work and live in wretched conditions. Death by accident and disease is an everyday occurrence.

"A global environmental leader like the United States should not have a national policy allowing the export of its toxic waste to developing countries ill-equipped to handle it," Miller told the subcommittee. "The American people have been promised that the globalization of the economy and the liberalization of trade would not turn out to be a race to the bottom. In the shipbreaking business, you've hit rock bottom when you get to Alang, India."

Proponents of overseas scrapping say the U.S. government could receive more money for its ships if it sold them abroad; unregulated foreign yards have much lower costs. The Maritime Administration is required by law to dispose of its obsolete ships in a way that maximizes the return to the government; no similar law governs the sale of Navy ships.

Gilchrest said yesterday that he opposes selling Navy or Maritime Administration vessels abroad. If necessary, he said, he will push for a law stating that the Maritime Administration would not be required to make a profit from the scrapping of old ships. He said he is reviewing whether additional laws might be needed to ensure that scrapping in U.S. yards is done safely.

"I think the whole program has to be overhauled," he said.

Pub Date: 3/19/98

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