Posted:
September 28, 2010
The following letter dated Sept. 24, 2010, was sent by the national president of American Maritime Officers to Congressman James Oberstar (D-MN), chairman of the Transportation and Infrastructure Committee in the House of Representatives, and Congressman Elijah Cummings (D-MD), chairman of the Subcommittee on Coast Guard and Maritime Transportation.
Having joined other representatives of seagoing labor in a letter to you earlier this month urging caution on the issue of U.S.-flagged liner vessel regulation, I must comment more specifically on your legislation to amend the Ocean Shipping Reform Act of 1998 and the harmful effects this bill could have on American merchant mariners, on the U.S. economy and on U.S. national security.
H.R. 6167, the bill you introduced September 22 with Rep. Elijah Cummings, would alter the existing U.S. regulatory regime under OSRA in ways that could make continued U.S.-flagged ship participation in U.S. commercial import and export trades impossible. The proposed amended rules are too cumbersome, too complex, too restrictive and too discouraging - U.S.-flagged merchant vessel operators could withdraw from these markets and abandon U.S. registry altogether.
The transfer of these ships to foreign registries would result in immediate unemployment for hundreds of American merchant mariners - including marine engineers and deck officers I am privileged to represent. Working men and women employed ashore in liner fleet corporate offices would lose their jobs as well, and the service and supply vendors that count these vessel operating companies among their customers could be forced to fire or furlough employees.
Flag-out on so large a scale would also result in the loss of federal tax revenues generated by U.S.-flagged merchant ship services and aggravate the U.S. trade imbalance in an increasingly important sector - the foreign-flagged shipping lines that already claim a 99-percent share of U.S. commercial trade would move in quickly to fill the resulting service gaps, and U.S. importers and exporters could be exposed to predatory pricing in the absence of at least some U.S.-flagged competition.
Another legitimate concern is that H.R. 6167 would weaken U.S. strategic sealift capabilities significantly. Many of the ships targeted by the legislation participate in the Maritime Security Program, which - as you know - provides the Department of Defense with timely access to reliable ships manned by skilled and dependable civilian American merchant mariners to provide specific military support services in defense emergencies. U.S.-flagged liner ships operated by the very companies that would be penalized unfairly by H.R. 6167 have delivered more than 80 percent of the cargoes sustaining U.S. Armed Forces in Afghanistan since 2001.
Many of the ships at issue also participate in Voluntary Intermodal Sealift Agreement - VISA. Under VISA, U.S.-flagged liners make cargo space available for defense equipment and supplies for safe and efficient delivery worldwide.
Moreover, liner fleet officers and crews on vacation from these jobs are among the first to crew government-owned and chartered sealift ships in a major mobilization.
As a practical matter, H.R. 6167 is unnecessary. The market has corrected the difficulties experienced by U.S. importers and exporters - and by the liner companies - in 2009 during the severe recession, and existing law and regulation provide for penalties in cases of proven or perceived abuse by vessel operators. In addition, Federal Maritime Commission Chairman Richard Lidinsky told the London-based Lloyd's List this morning that the FMC would monitor shipping lines in the U.S. import and export trades "like a hawk" in the next several months as H.R. 6167 is debated and discussed.
We in American Maritime Officers share your stated commitment to help the administration "double U.S. exports in the next five years." But we do not believe that the additional export of U.S. seafaring jobs is among the goals the President and you have in mind. We want to know for certain that U.S.-flagged liner ship companies will be around to participate in these anticipated new trades to the greatest possible extent - and a punitive law that would in fact make markets more difficult to navigate is not the way to ensure a U.S.-flagged presence in 2015.
As you know from long and direct experience with U.S. maritime policy, the American merchant fleet in international trade must contend not only with artificial cost advantages enjoyed by foreign-flagged fleets, but also with federal agencies that defy U.S. cargo preference laws routinely - whether these cargoes be food aid exports managed by the Agency for International Development or foreign-made renewable energy project components financed through loan guarantees from the Department of Energy under the Recovery Act. Another dense layer of regulatory bureaucracy is not what the U.S. merchant fleet needs to continue in commercial liner trades.
We expect H.R. 6167 - or a successor in the next Congress - will be aired thoroughly in your committee, and we ask respectfully that AMO and other representatives of seagoing labor be allowed a place at the table.
Thank you for your time and for your strong and consistent record of support of the U.S. merchant fleet and American merchant mariners in all domestic and international trades.
Legislation to amend Ocean Shipping Reform Act could have harmful impact on U.S. merchant mariners
The following letter dated Sept. 24, 2010, was sent by the national president of American Maritime Officers to Congressman James Oberstar (D-MN), chairman of the Transportation and Infrastructure Committee in the House of Representatives, and Congressman Elijah Cummings (D-MD), chairman of the Subcommittee on Coast Guard and Maritime Transportation.
Having joined other representatives of seagoing labor in a letter to you earlier this month urging caution on the issue of U.S.-flagged liner vessel regulation, I must comment more specifically on your legislation to amend the Ocean Shipping Reform Act of 1998 and the harmful effects this bill could have on American merchant mariners, on the U.S. economy and on U.S. national security.
H.R. 6167, the bill you introduced September 22 with Rep. Elijah Cummings, would alter the existing U.S. regulatory regime under OSRA in ways that could make continued U.S.-flagged ship participation in U.S. commercial import and export trades impossible. The proposed amended rules are too cumbersome, too complex, too restrictive and too discouraging - U.S.-flagged merchant vessel operators could withdraw from these markets and abandon U.S. registry altogether.
The transfer of these ships to foreign registries would result in immediate unemployment for hundreds of American merchant mariners - including marine engineers and deck officers I am privileged to represent. Working men and women employed ashore in liner fleet corporate offices would lose their jobs as well, and the service and supply vendors that count these vessel operating companies among their customers could be forced to fire or furlough employees.
Flag-out on so large a scale would also result in the loss of federal tax revenues generated by U.S.-flagged merchant ship services and aggravate the U.S. trade imbalance in an increasingly important sector - the foreign-flagged shipping lines that already claim a 99-percent share of U.S. commercial trade would move in quickly to fill the resulting service gaps, and U.S. importers and exporters could be exposed to predatory pricing in the absence of at least some U.S.-flagged competition.
Another legitimate concern is that H.R. 6167 would weaken U.S. strategic sealift capabilities significantly. Many of the ships targeted by the legislation participate in the Maritime Security Program, which - as you know - provides the Department of Defense with timely access to reliable ships manned by skilled and dependable civilian American merchant mariners to provide specific military support services in defense emergencies. U.S.-flagged liner ships operated by the very companies that would be penalized unfairly by H.R. 6167 have delivered more than 80 percent of the cargoes sustaining U.S. Armed Forces in Afghanistan since 2001.
Many of the ships at issue also participate in Voluntary Intermodal Sealift Agreement - VISA. Under VISA, U.S.-flagged liners make cargo space available for defense equipment and supplies for safe and efficient delivery worldwide.
Moreover, liner fleet officers and crews on vacation from these jobs are among the first to crew government-owned and chartered sealift ships in a major mobilization.
As a practical matter, H.R. 6167 is unnecessary. The market has corrected the difficulties experienced by U.S. importers and exporters - and by the liner companies - in 2009 during the severe recession, and existing law and regulation provide for penalties in cases of proven or perceived abuse by vessel operators. In addition, Federal Maritime Commission Chairman Richard Lidinsky told the London-based Lloyd's List this morning that the FMC would monitor shipping lines in the U.S. import and export trades "like a hawk" in the next several months as H.R. 6167 is debated and discussed.
We in American Maritime Officers share your stated commitment to help the administration "double U.S. exports in the next five years." But we do not believe that the additional export of U.S. seafaring jobs is among the goals the President and you have in mind. We want to know for certain that U.S.-flagged liner ship companies will be around to participate in these anticipated new trades to the greatest possible extent - and a punitive law that would in fact make markets more difficult to navigate is not the way to ensure a U.S.-flagged presence in 2015.
As you know from long and direct experience with U.S. maritime policy, the American merchant fleet in international trade must contend not only with artificial cost advantages enjoyed by foreign-flagged fleets, but also with federal agencies that defy U.S. cargo preference laws routinely - whether these cargoes be food aid exports managed by the Agency for International Development or foreign-made renewable energy project components financed through loan guarantees from the Department of Energy under the Recovery Act. Another dense layer of regulatory bureaucracy is not what the U.S. merchant fleet needs to continue in commercial liner trades.
We expect H.R. 6167 - or a successor in the next Congress - will be aired thoroughly in your committee, and we ask respectfully that AMO and other representatives of seagoing labor be allowed a place at the table.
Thank you for your time and for your strong and consistent record of support of the U.S. merchant fleet and American merchant mariners in all domestic and international trades.