Renewal, expansion of Maritime Security Program would spur U.S. investment in commercial shipping

Renewal, expansion of Maritime Security Program would spur U.S. investment in commercial shipping

Maritime Trades Department advocates pro-active legislation to extend crucial policy

      Early renewal of the Maritime Security Program would encourage investment in U.S.-flag merchant fleet improvements and ensure continued Department of Defense access to commercial vessels for sealift in national security emergencies, the executive board of the AFL-CIO Maritime Trades Department said Feb. 20.
      In a policy statement adopted during its two-day meeting in Bal Harbour, Fla., the board urged the Bush administration and the 108th Congress to agree this year on legislation to extend the MSP beyond its scheduled expiration in September 2005 and to expand the program's scope.
      "An MSP extension would signal the U.S.-flag shipping companies that they can plan ahead to replace aging fleets with modern, more technologically advanced vessels," said the statement. "One scenario being proposed would continue the program for an additional 20 years, which would provide plenty of time to plan, build and sail these next-generation commercial ships."
      A longer MSP lifespan would also "make sure the United States would not have to depend on foreign-flag vessels, with their polyglot crews--a great many of them sailing with little or no training and questionable international allegiance--to deliver war materiel to American troops around the world," the statement continued. "In these trying times marked by high concern of terrorist activities, U.S. forces know they can rely on American crews to deliver the goods, just as U.S. merchant mariners have done since the founding of the country."
      The Maritime Security Program was authorized for 10 years in the Maritime Security Act of 1996. The program provides each of 47 privately owned and operated U.S.-flagged roll-on/roll-off, container and lighter-aboard ships with $2.1 million a year to help offset the cost of competing with foreign-flagged ships--including those registered under flags of convenience--in commercial foreign trade. The money--approximately $98 million a year-- must be approved annually as a direct appropriation through the Maritime Administration, an agency in the Department of Transportation.
      In exchange for the limited direct operating aid, the ships and their crews are available on demand to DOD for military support services in wartime. Companies that participate in the MSP must also make intermodal and logistics support systems they own or lease available to DOD.
      In its policy statement, the MTD executive board noted that the Maritime Security Program was proposed initially in 1992, and that nearly five years of debate in the House and Senate had resulted in bipartisan legislation that met with "overwhelming" approval in both chambers. One inducement to MSP approval was a legislative "framework" drawn from industry-wide consensus, the statement said. The MSP has "ensured that the U.S. has a pool of skilled American mariners ready to crew not only the MSP vessels, but also government-owned strategic sealift and Ready Reserve Force ships," the statement said.
      Moreover, the program has helped maintain "a U.S.-flag presence in the world's ports."
      The statement also cited authoritative estimates putting the government's cost of duplicating the sealift capacity MSP represents at "10 times" the program's cost.
      "By all accounts, MSP extension and expansion is a winning proposal for the United States," the statement concluded. "The Maritime Trades Department, AFL-CIO, its affiliated unions and its Port Maritime Councils call on the Bush administration and the 108th Congress to work with the U.S.-flag maritime industry to craft and pass legislation that will extend and expand the Maritime Security Program. Such a move will make sure the United States will continue to have a strong, viable U.S.-flag merchant fleet for years to come."
      In a separate policy statement, the MTD executive board addressed U.S.-flag cargo preference laws.
      Under three principal statutes, specific shares of government-financed imports and exports are set aside for U.S.-flagged merchant ships--100 percent of defense cargoes, 50 percent of all non-defense cargoes, and 75 percent of all humanitarian food aid exports generated in the Department of Agriculture. Together, the laws form "a central component" of U.S. maritime policy, but they are too often subject to inappropriate and inaccurate criticism, the MTD board said.
      "Cargo preference laws have been unfairly attacked by exporting industries or undermined by federal agencies that have searched for every opportunity to circumvent Congressional intent in the passage of these laws," the board's statement explained. However, MARAD "keeps a vigilant eye" on preference programs and does what it can under the law to enforce the U.S.-flag requirements.
      "Despite these efforts, several federal agencies ... systematically attempt to circumvent the nation's cargo preference laws," the statement added.
      Statutory U.S.-flag set-asides have served worthy purposes and are meant to provide "a stable source of cargoes," an important consideration because "there are occasions when a single shipment can determine whether a (U.S.-flag vessel) operator survives another day." Without the preference laws, "there is no doubt that a number of U.S.-flag carriers would go out of business or leave the U.S. fleet--a circumstance America can ill afford."
      The board urged lawmakers to sustain U.S.-flag cargo preference laws, which in turn help sustain a civilian seagoing labor base for defense sealift service. Without the laws, the U.S. "may cease to be a sea power, with no presence and no control on the commercial sea lanes of the world--that, indeed, would be a national tragedy."

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