REVIVING MERCHANT FLEET

ENCOURAGING INTEREST in the sorry plight of the U.S.-flag merchant marine has been displayed in the opening weeks of the 100th Congress. What actually results in the form of legislation will depend on Congress rather than the executive branch. The Reagan administration will be preoccupied, first, with repairing its own battered image and, second, with the 1988 elections.

It was determined hard work in Congress that produced the Shipping Act of 1984, dealing with regulatory reforms, and last year's Water Resources Act, ending years of inaction and controversy over port channel improvements. The initiative for measures to rescue the merchant marine must also come from Congress.With that as a given, the most urgent need is to determine what has brought the merchant fleet to its present deplorable state, what can be distilled as realistic and achievable from the various remedies proposed, and what can be enacted into law in furtherance of a clearly defined national maritime policy.

This sounds like a tall order, and indeed it is. The alternative almost certainly would be two years wasted in committee-level bickering over isolated legislative proposals, with no result other than an accumulation of testimony. If legislation to revive and promote the merchant marine is to get anywhere, it must be sharply focused, serve an understandable national purpose and generate confidence within the shipping industry and its users.

An example of the difficulties Congress can encounter lies in the bill just introduced by Rep. Walter Jones, chairman of the House Merchant Marine and Fisheries Committee. Its stated purpose is to protect U.S.-flag shipping

from unfair discriminatory and restrictive regulations by foreign governments. The Federal Maritime Commission would be authorized to investigate allegations of such practices and, where they exist, impose penalties.

Simply determining whether an action by a foreign government discriminates unfairly against U.S. shipping, or whether it could be justified from the standpoint of a sovereign government, would be an enormous task. Would the action, perhaps, be no more than a variation of the Argentine and Brazilian pools to which the U.S. government has acquiesced?

The bill automatically would make suspect any U.S. trading partner carrying 15 percent or more of any class of U.S. imports or exports in ships of its own flag, clashing with the 40-40-20 formula proposed in the liner code of the United Nations Conference on Trade and Development. It would also condemn, by implication, the preference formula in at least one of the U.S.-Soviet shipping agreements of the past - not to mention the bilateral shipping agreements advocated by some U.S. interests.

Unfair and irritating foreign discrimination that works to the disadvantage of U.S.-flag shipping certainly exists. But this country's merchant marine can hardly wait for it to be identified, punished and corrected.

Again, the Commission on Merchant Marine and Defense has just held its first hearing. Its task is to examine the adequacy of the merchant marine in terms of defense needs and to make recommendations. We venture to predict that its report will sound an urgent warning. But the essential test of a merchant marine is its commercial worth.

The merchant marine's role in the peacetime transport of military supplies to U.S. forces overseas and to our allies is important. In today's unhappy maritime situation such traffic can be a matter of survival for U.S.-flag carriers. Even so, national policy for the merchant fleet must rest primarily on its role in trade. That in itself is the best assurance that good ships and good crews will be available if the national security requires them.

Rep. Mario Biaggi, chairman of the House merchant marine subcommittee, has made a good start with the bill he introduced on operating subsidy reforms last month. It will undergo some revision, of course, but it would seem to be the best foundation on which to build a thorough and effective modernization of national goals for the U.S.-flag merchant fleet.

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