SHIPPING: A Costly Passage

Congress is poised to approve a measure that could add millions of dollars to America’s energy bills over the next decade and deal a great blow to free trade—all to help out the politically powerful shipbuilders and maritime unions. The Energy Transportation Security Act would require that by 1977 30% of the nation’s oil imports be carried in tankers that are built in the U.S., fly the U.S. flag and employ American sailors. Because such ships cost much more to build and operate than foreign vessels, almost no imported oil is carried in them now. Indeed, to meet the bill’s requirements, the capacity of the nation’s tanker fleet would have to be dramatically enlarged, costing billions, and the Government would have to raise its subsidies to shipbuilders and operators by no less than $800 million over the next five years. In addition, the bill would violate 30 U.S. treaties with other governments outlawing preferences for commercial cargoes.

Even so, the House has passed the bill 266 to 136, and the Senate is expected to follow through soon. The measure has been endorsed by a bipartisan phalanx of Senators from Gulf and West Coast states. And there probably is enough support for Congress to override any possible veto by President Nixon, who to his credit opposes the proposal.

Recognizing the dangers, ten Government agencies and departments—including State, Treasury and Commerce —have voiced opposition. So have the major oil companies, led by Exxon, and the farm groups, which recognize that the bill would kick up prices for their members’ oil and gasoline. But their opposition pales in the face of strong lobbying by the shipbuilders and the maritime unions, which give lavish campaign contributions and generous speakers’ fees to legislators.

They have made most of their mileage out of that versatile rhetorical jalopy, national security. Particularly after the recent oil embargo, argue the lawmakers, America must build up its own fleet to insure delivery of oil from abroad. But how would U.S.-flag tankers help if foreign producers again cut off the source of oil? Supporters do not answer the question, and so far it has failed to impede the progress of this expensive piece of legislation.