CONFERENCE ADVERTISEMENT SPARKS HEATED CONFRONTATION

CONFERENCE ADVERTISEMENT SPARKS HEATED CONFRONTATION

U.S. seaborne labor and U.S.-flag ship operator representatives refused to speak at a conference on dry bulk shipping in New York this week, but that did not stop a sharp debate over U.S. cargo preference laws from developing.

Tal Simpkins, executive director of the AFL-CIO maritime committee, and Ernie Corrado, executive director of U.S.-flag lobby group the American Institute of Merchant Shipping, had been scheduled to speak on a panel on U.S. trade and maritime policy. But after an advertisement for the conference quoting cargo preference opponents appeared in The Journal of Commerce, Mr. Corrado and Mr. Simpkins withdrew from the panel."What we object to is the inflammatory ads," said Jessica Smith, a spokeswoman for the Seafarers International Union. About 15 members of the SIU were in the hallways outside the conference Monday morning handing out leaflets objecting to the advertisements.

"The two advertisements in The Journal of Commerce attacking the government-impelled cargo preference program with my name listed below with the speakers suggest that I endorse those statements, which I do not," said Mr. Corrado in a letter to a conference sponsor. The Journal of Commerce also was a sponsor of the conference.

Kenneth C. Cunningham, legislative staff director for cargo preference opponent Sen. Charles Grassley, R-Iowa, spoke on a panel at the conference Monday and was unapologetic about his boss's positions on cargo preference laws. Under cargo preference laws, certain cargoes, such as U.S. government military and food aid traffic, are reserved for U.S.-flag operators, which charge more than foreign-flag shipowners do.

"Sometimes the cost of U.S-flag shipping is more than the value of the (government food aid), which reduces the amount of food we can send overseas," said Mr. Cunningham. "So the starving overseas are victims" of cargo preference policy, he said. Mr. Cunningham estimated that cargo preference costs the government $500 million to $600 million a year.

Representatives of the U.S.-flag industry reacted with anger to Mr. Cunningham's statements, calling them distorted and unfair. In particular, they objected to his contention that U.S.-flag shipping can cost five times as much as foreign-flag shipping.

"Let's compare apples to apples," said an executive with one U.S.-flag operator. U.S.-flag representatives contend that the restrictive terms of U.S.-government shipping contracts make them more expensive to comply with than typical international cargo contracts. Port costs can also be very high in some of the Third World nations where U.S. government cargo is bound.

"There are severe distortions going on here," said Ms. Smith in reaction to Mr. Cunningham's statements.