Congressional Record, Volume 142 Issue 133 (Tuesday, September 24, 1996)

[Congressional Record Volume 142, Number 133 (Tuesday, September 24, 1996)]
[Senate]
[Pages S11151-S11158]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

MARITIME SECURITY ACT

The PRESIDING OFFICER. Under the previous order, the hour of 4:30
p.m. having arrived, the Senate will now resume consideration of H.R.
1350, which the clerk will report.
The legislative clerk read as follows:
A bill (H.R. 1350) to amend the Merchant Marine Act, 1936, to
revitalize the United States-flag merchant marine, and for other
purposes.
The Senate resumed the consideration of the bill.

Pending:
Grassley amendment No. 5393, to clarify the term fair and
reasonable compensation with respect to the transportation of
a motor vehicle by a certain vessel.
Grassley amendment No. 5394, to prohibit the use of funds
received as a payment or subsidy for lobbying or public
education, and for making political contributions for the
purpose of influencing an election.
Grassley amendment No. 5395, to provide that United States-
flag vessels be called up before foreign flag vessels during
any national emergency and to prohibit the delivery of
military supplies to a combat zone by vessels that are not
United States-flag vessels.
Inouye (for Harkin) amendment No. 5396 (to amendment No.
5393), to provide for payment by the Secretary of
Transportation of certain ocean freight charges for Federal
food or export assistance.
Mr. STEVENS. Mr. President, what is the parliamentary situation now
with regard to time?

[[Page S11152]]

The PRESIDING OFFICER. There will now be 30 minutes debate, equally
divided, on the rate issue, 15 minutes under the control of the Senator
from Iowa [Mr. Harkin] and 15 minutes under the control of the Senator
from Iowa [Mr. Grassley].
Mr. STEVENS. I think it was our intention that we would have 1 minute
on each side; Senator Inouye with regard to the Harkin amendment, and
myself with regard to the Grassley amendment.
I ask unanimous consent that be the case. We have to have some time
to move to table and make a comment.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. STEVENS. The remainder of the amendments are likewise controlled?
The PRESIDING OFFICER. There is a series of amendments to be voted on
in sequence.
Mr. STEVENS. It was my understanding the Senator from Iowa wishes to
withdraw one of those amendments. I ask he be recognized for that
purpose.
The PRESIDING OFFICER. The Senator from Iowa.

Amendment No. 5395 Withdrawn

Mr. GRASSLEY. Mr. President, I ask to withdraw amendment No. 5395.
For my colleague from Iowa, this is not the amendment regarding which
his amendment amends mine. I ask unanimous consent to withdraw No.
5395.
The PRESIDING OFFICER. Without objection, it is so ordered.
Amendment No. 5395 was withdrawn.
The PRESIDING OFFICER. Who yields time? The Senator from Iowa.
Mr. HARKIN. I understand I am recognized for up to 15 minutes?
The PRESIDING OFFICER. The Senator is correct.

Amendment No. 5396 to Amendment No. 5393

Mr. HARKIN. Mr. President, I have been generally supportive of the
practice of shipping a certain percentage of our U.S. foreign food
assistance on U.S.-flag ships. I have in the past supported amendments
designed to reform that program to ensure the costs of using the U.S.-
flag ships are reasonable. But I have not been supportive of proposals
that would essentially kill the policy of using U.S.-flag vessels,
because I believe that U.S. maritime fleet ships are important to our
national defense.
I also believe that when we are providing largess to other countries,
we should do all that we can to also support U.S. jobs and U.S.
industries. After all, we make sure that U.S. farm commodities are used
in these food shipments. We do not go to other countries to buy the
food to give it away. We use our own farm commodities. As long as costs
are fair and reasonable, I believe we ought to use U.S. ships to haul a
share of this aid.
My colleague from Iowa, Senator Grassley, says that I may be
undercutting his efforts at reform. But my amendment is the only way to
have real reform. What my amendment would do, is take any higher costs
involved in using U.S.-flag ships out of USDA entirely and put it in
the Department of Transportation.
Senator Grassley's amendment would essentially kill our U.S. maritime
industry by sending shipping business to foreign-flag vessels. If, for
example, a foreign ship would haul cargo for $18 a ton, Senator
Grassley's amendment would give that business to a foreign-flag vessel
if the U.S. ship was going to charge any more than $19.08 a ton. Is
that the price at which we will sell out our U.S. maritime industry,
which is so important to military sealift and military security, $1.08
a ton?
Or, if you are using container ships, if the lowest acceptable
foreign rate, just to take a hypothetical example, is $1,000 a
container, Senator Grassley's amendment would cut out U.S. ships if
their rate is any higher than $1,060 a container. So for $60 a
container we would give all that business to a foreign country.
I do believe, however, that supporting our U.S. merchant marine is
properly a transportation function, rather than an agricultural or food
aid function. Any higher costs of using U.S.-flag ships should not come
out of the food aid budget but should, instead, come out of the
Department of Transportation budget.
I will also point out that the amendment of my colleague, Senator
Grassley, would still have any higher costs of U.S. ships coming from
the agricultural food aid budget. I do not think that is right. I do
not think that is real reform.
Let us be clear, there have been some gross exaggerations about the
higher costs of U.S.-flag ships. But I admit freely there are some
higher costs involved, because those U.S. ships must comply with more
stringent environmental and safety regulations and because the people
who work on them are U.S. citizens and they pay U.S. taxes. Those
people who work on those ships pay Federal and State and local taxes.
They have homes here in communities in our country. They pay property
taxes. They support their local schools.
If you take the money paid for shipping food aid and give it to a
foreign-flag vessel and to foreigners operating on those ships, they do
not pay any taxes here, they do not support our local schools, they do
not raise their kids in America.
All in all, the U.S. maritime industry runs a more responsible
operation than flag-of-convenience operators that may sail under the
flag of a foreign country with very lax standards. So our costs of
operation are understandably higher.
In any event, then, there are some higher costs in using U.S.-flag
ships. This is called the ocean freight differential. To the extent
that USDA pays for this differential, there is some reduction in the
amount of food aid that can be shipped. That is what I want to change.
My amendment would simply shift all of any added costs of using U.S.-
flag ships to the Department of Transportation. There is clear
precedent for my amendment. In fact, it would build on a partial shift
of cargo preference costs to the DOT that we began in 1985.
Prior to the 1985 farm bill, 50 percent of U.S.-sponsored food
shipments were required to be transported on U.S.-flag ships. There was
a court decision that held that this requirement applied to commercial
sales as well as to food aid. So a compromise was reached in the 1985
farm bill under which 75 percent of food aid--that is the donations and
concessional sales of food that we give to people overseas--would be
transported on U.S.-flag ships, but that commercial agricultural
exports would be totally exempt from any cargo preference requirement,
even if those sales were supported by U.S. export subsidies or
assistance. So, today, less than 2 percent of our total agricultural
exports are required to be transported on U.S.-flag ships. No
commercial sales are under the requirement at all.
Part of that compromise that we reached in 1985 was that the
Department of Transportation would reimburse the Department of
Agriculture, for any increase in food aid shipping costs caused by that
change in the cargo preference requirement from 50 percent to 75
percent. So, already the Department of Transportation covers a portion
of any higher charges for shipping food aid on U.S.-flag vessels.
What my amendment would do is shift all cargo preference cost over.
The Department of Transportation would reimburse the Department of
Agriculture for all food aid shipping charges to the extent they exceed
prevailing world shipping rates. My amendment employs the same
reimbursement mechanism now used by the Department of Transportation to
reimburse the Department of Agriculture for a portion of those costs.
So my amendment will put the costs of supporting our U.S.-flag merchant
marine--which I believe is vitally important to this country--where it
belongs, in the Department of Transportation, not the Department of
Agriculture.
As I said, I have always believed, and still do, that it is important
to support our U.S.-flag merchant marine as a matter of national
security. Also, because shipping is an important basic U.S. industry,
with U.S. jobs at stake, employing U.S. citizens, people who work and
raise their families here and pay their taxes in this country, I
believe it is important to have a U.S. merchant fleet.
We cannot afford to send any more U.S. jobs out of this country. The
Grassley amendment would do that. It would turn over everything to
foreign vessels flying a flag of convenience. But that support, I say,
that we should provide for our U.S. merchant marine should not diminish
the quantity of agricultural commodities that USDA can ship as food
aid. If we are going to give food to hungry people and starving people
around the world--which we ought

[[Page S11153]]

to do--to the extent that it costs us more to ship it on U.S.-flag
vessels, that money should not come out of the food aid budget, it
ought to come out of our transportation budget.
I tried to offer this amendment several years ago, in 1990. It was
tabled. Again, I recall my colleague from Iowa moved to table the
underlying amendment and brought down that amendment, too.
Unfortunately, the debate over cargo preference has pitted agricultural
interests against maritime interests. That is too bad. In order to meet
the stiff challenges from overseas competition in the trade arena, we
need more cooperation, not antagonism among our basic American
industries.
I am proud to represent an agricultural State. I am proud of how much
we sell overseas. I am also proud of how much food the citizens of Iowa
donate every year abroad. I am also proud of the men and women who go
to sea in ships. Perhaps it is because of my military background. Maybe
it is because I spent so much time in the Navy. But I know what a
lonesome life it can be, and I know how hard they work, and I know how
they sacrifice and give up a lot of time from their families. I also
know when our country calls on that merchant fleet to ship military
cargoes to a foreign country, in dangerous waters, they must respond.

Now, if it is a foreign-flag vessel, we cannot call on it to sail
into dangerous areas for military purposes. They can simply say no, we
are not going to ship your cargo because we believe it is too
dangerous. So that is why I maintain my strong support for a strong
U.S.-flag merchant fleet. And I believe as deeply as I believe anything
that the funding to support our U.S.-flag merchant fleet should come
out of the transportation budget, and I will continue to fight for
that.
That is all my amendment does. Again, I hope that we don't have to
have this antagonism between agriculture and the maritime industry. It
shouldn't be there. We ought to be working together. We ought to be
working together for the benefit of more jobs in the U.S., for the
benefit of a stronger agriculture in the U.S. and, yes, working
together to make sure that out of our generosity we give the maximum
amount of food aid that we can give to starving people around the
world.
I believe my amendment will resolve a nettlesome issue that has
fostered conflict between agriculture and the maritime industry for a
long time. My amendment will allow USDA to ship more food aid and to
purchase more farm commodities for that purpose. And, yes, it will
support a strong maritime industry. I urge my colleagues to support my
amendment.
Mr. President, how much time do I have remaining?
The PRESIDING OFFICER. Four minutes 50 seconds.
Mr. HARKIN. I reserve the remainder of my time.
The PRESIDING OFFICER. Who yields time?
The senior Senator from Iowa.
Mr. GRASSLEY. I yield myself 10 minutes.
Mr. President, everyday, millions of Americans get up, they have
their breakfast, they pack their lunches, they send their kids off to
school. In many households, over a majority, both spouses work. These
are the forgotten Americans, the people who go to work every day. They
are working harder and harder and taking home less and less money.
Nobody is talking on this bill about that portion of America. That is
the America we should be concerned about.
So I use that to remind all of my colleagues, Republicans and
Democrats, that we are about to vote to create a new subsidy program, a
corporate welfare subsidy program. I say to my Democratic colleagues--
all of them--how many times do I hear you say that we should end
corporate welfare? This is an opportunity to do that, by not voting for
this bill and creating a new welfare program.
I say to my Republican colleagues who, in the tax bill last year,
thought it was so necessary to respond to the people's will to
eliminate corporate welfare, that we had in our tax bill probably $25
billion of reduction in corporate welfare that is done through the Tax
Code of the United States.
So I say to my Republican colleagues, you have an opportunity to have
one less corporate welfare program on the books by not voting for this
bill.
In the meantime, we have some amendments. We are about to cast votes
on two of them that I have sponsored and one that Senator Harkin
sponsors, a second-degree amendment, and I strongly oppose his
amendment.
In a few short minutes, I am going to attempt to help my colleagues
separate fact from fiction. What I share with my colleagues is not just
my opinion. It is either backed by independent sources or is the
learned conclusion of those who have spent a great deal of time
studying the questions of maritime subsidies.
First, let me direct the attention of my colleagues to two lead
editorials that were included in today's Wall Street Journal on the one
hand and today's Journal of Commerce on the other, and I placed copies
on your desks. Both the Wall Street Journal and the Journal of Commerce
expressed strong opposition to the subsidy bill before the Senate.
Remember, these are opinions of journals that are the voices of
business and transportation. They oppose this corporate welfare
proposal.
My colleagues should also know that the Citizens for a Sound Economy,
a grassroots organization representing hundreds of thousands of
Americans, are key voting my fair and reasonable rate amendment and my
antilobbying amendment. Those key votes are used for their Jefferson
award.
We also have Citizens Against Government Waste backing my amendments
and key voting those as well.
We have the National Taxpayers Union using these amendments for their
annual vote analysis.

These groups, as well as Americans for Tax Reform, all oppose this
underlying legislation, which is a $1 billion corporate welfare subsidy
bill.
Does our national defense, as is purported by the managers of this
bill, depend upon the 47 U.S.-flag vessels that are asking for a $100
million subsidy per year? A former Bush administration official,
Assistant Secretary of Defense Colin McMillan, said the answer to that
question is ``No.'' He said that the issue of U.S. carriers reflagging
is not a national security issue and, therefore, should be viewed in
terms of economics. That is an Assistant Secretary in the last
Republican administration.
Then on the other side of the aisle, most recently Cabinet heads in
the Clinton administration studied this issue and made recommendations
to the President on whether or not to continue subsidies. Every Senator
had in his office last week a copy of the Rubin memo to President
Clinton. Again, these are conclusions based upon President Clinton's
Cabinet officials, their conclusions by Democratic officials, and they
are not my conclusions. They said it amounts to a jobs bill to pay for
high-price seafarers. Those are the conclusions from that memo.
Mr. President, as I stated last week, a number of retired admirals
who earlier lent their names to an American Security Council letter
endorsing this legislation--now that they have the benefit of the
Rubin-Clinton memo--support my amendments to this bill and, in fact,
believe further hearings should have been held before we pass such
legislation. Again, those are retired admirals, not this Senator from
Iowa.
To my colleague from Iowa, for his amendment and my opinion on that
amendment--I suppose I gave that opinion last week, but I owe it to my
colleague to state here now for a short period of time, my position.
My colleague from Iowa said that he doesn't want to sell out our
merchant marines. Nobody wants to do that, but I think there is a
bigger issue here, and that bigger issue is whether or not, with this
corporate welfare subsidy, we will be in the process of selling out the
taxpayers.
Our No. 1 responsibility is to the taxpayers of America. If my
colleague from Iowa succeeds in substituting his amendment for mine,
all that will be accomplished is that taxpayers will continue to get
ripped off so maritime union welfare and corporate welfare will
continue to be shoveled out with no restraint. And farmers, who are
taxpayers as well, will not be able to ship one extra bushel of food
overseas.
Taxpayers get ripped off either way. They get ripped off if the
Agriculture

[[Page S11154]]

Department pays for cargo preference or if the Transportation
Department pays for it. The end result is the same. So I strongly
oppose his amendment.
Mr. President, why do we need to adopt, then, my amendment that calls
for a fair and reasonable compensation? Fair and reasonable. Who can
argue with that?
That supposedly is the rationale now for all of these rates, but the
bottom line of it is that the maritime industry defines what is fair
and reasonable. If we don't adopt this amendment, then these subsidized
carriers will collect $100 million per year from this bill and then
routinely gouge taxpayers to the tune of $600 million per year.
This figure of $600 million per year is established by the Federal
agencies and by the Office of Management and Budget. It is reported
every year in the President's budget, and I placed a copy of this
information in last Friday's Record.
Again, $600 million in backdoor cargo preference subsidies is not
Chuck Grassley's estimate, it is the actual figures provided by the
Office of Management and Budget.
If we protect taxpayers from price gouging under Buy America laws,
then why shouldn't we do likewise under cargo preference laws?
So my amendment then, does that. It takes the Buy America market test
of 6 percent and, like Buy America, says that if a Government agency is
charged by a U.S.-flag carrier more than 6 percent what the market
bears or, in other words, what a foreign flag might offer, then that
agency can hire the foreign flag.

For years, we have been assured that taxpayers are protected by
existing law that states a bid has to be a fair and reasonable rate,
but Congress never defined this term and, instead, left it to the
Maritime Administration, which cares not for the taxpayers.
If you can have the U.S. flags charge 400 percent over a foreign flag
bid, the Maritime Administration may state that this is a fair and
reasonable bid and that agency has to accept that bid. It has happened.
The PRESIDING OFFICER (Mr. Gorton). The Senator has used the original
10 minutes.
Mr. GRASSLEY. How much time does the Senator from Colorado want?
Mr. BROWN. I would like at least 2 minutes.
Mr. GRASSLEY. I will yield myself 1 minute, and then when I sit down,
I will yield the remainder of my time to the Senator from Colorado.
The PRESIDING OFFICER. The Senator from Iowa.
Mr. GRASSLEY. Mr. President, I remind everybody who says that this is
necessary for our national defense, to remember that U.S. News & World
Report article in 1990 entitled ``Unpatriotic Profits.'' It reported
how the Navy was being forced to pay U.S.-flag carriers $70,000 to ship
what could have gone on foreign flags for just $6,000.
This was during the Persian Gulf war. It was because our cargo
preference laws are out of control. My amendment will take care of
this.
If my amendment does not pass, we will see the same abuses the next
war that we face. Nothing in this bill defines fair and reasonable
rates. My amendment does define what is fair and reasonable in the very
same way we have defined it in the Buy America. I yield the rest of my
time to the Senator from Colorado.
Mr. BROWN addressed the Chair.
The PRESIDING OFFICER. The Senator from Colorado.
Mr. BROWN. Mr. President, I hope Members, as they vote on this
measure, will keep a couple of things in mind that I think are
critical. One is this measure does not attempt to do away with the buy-
America preferences that have existed in the law. It keeps those. What
it does do, Mr. President, is define what fair and reasonable is.
In the past, literally, the Department of Transportation has looked
at rates that have been 100 percent, 200 percent, 300 percent, 400
percent above what is available on the market and called those
reasonable and fair. Mr. President, that is simply ludicrous. Charging
double or triple what your competitor charges is not reasonable and
fair. We do not kid anyone when we allow that sort of thing to go
ahead. It is a scandal on the American taxpayers to have them stuck for
two and three and four times as much what reasonable rates are.
The second point I hope Members will look at is this: One of the good
arguments that have been made for those who defend the existing system
is that, on occasion, what they are comparing is apples and oranges;
that is, the higher rates that have been talked about at times--not
always, but at times--sometimes have been in circumstances where you
could not unload the cargo and it was not an apples-to-apples
comparison.
The Grassley amendment, very importantly, is defined in such a way so
that it allows the Secretary to take into consideration those other
conditions that may exist. In other words, the Grassley amendment is an
apples-to-apples comparison. It is a fair comparison. It is not an
unreasonable comparison. It meets directly the arguments in opposition
that the opponents of these measures in the past have made.
Mr. President, I simply close with this thought. How can we say to
the taxpayers of this country that we are looking out for their
interests when we allow them to get stuck for two and three times as
much as what the real rate is on these kinds of cargoes? I yield the
floor, Mr. President, and urge the adoption of the Grassley amendment.
Mr. HARKIN addressed the Chair.
The PRESIDING OFFICER. The Senator from Iowa.
Mr. HARKIN. How much time do I have remaining?
The PRESIDING OFFICER. Four minutes forty-eight seconds.
Mr. HARKIN. Four minutes forty-eight seconds?
The PRESIDING OFFICER. Yes.
Mr. HARKIN. Mr. President, again, I would just point out under the
amendment of my colleague from Iowa, money that would go to pay for the
ocean freight differential would still come out of the Agriculture
budget, out of food aid. That is what I am basically opposed to, having
it come out of Agriculture. It is a 6-percent limitation that my
colleague has in his amendment, but any higher costs of U.S.-flag ships
would still come out of Agriculture. I do not think it ought to. I
think the money for the ocean freight differential ought to come out of
the Department of Transportation. That is what my amendment does.
Again, I hear all of these comparisons of shipping rates. My friend
from Colorado, and of course my esteemed colleague from Iowa, have all
these comparisons, but these are based on artificially low foreign
rates subsidized by foreign governments, or rates for ships that
operate without having to comply with the operating standards that
apply to U.S.-flag vessels. So these kinds of comparisons may seem
appealing, but they do not reflect a fair or accurate representation of
the factors involved in the rates charged by U.S. ships.
For example, our people are paid higher wages, our ships have to
follow stronger and stricter environmental standards and our ships have
to meet stricter working conditions and occupational health and safety
requirements. None of these considerations is taken into account by the
amendment of my colleague from Iowa. I keep pointing out that workers
on U.S.-flag ships, U.S. citizens, pay Federal, State and local taxes.
In fact, I am informed that existing Federal and State income tax
requirements alone nearly double the cost of U.S.-citizen crews to
U.S.-flag operators. Well, where do they pay those taxes? They pay
those taxes here in America.
Mr. President, let me also point out that there currently are
limitations in place on the rates that U.S.-flag vessels may charge for
hauling cargo preference shipments. For non-defense cargoes, for
example, by law preference is given to U.S.-flag vessels only when such
vessels are available at ``fair and reasonable rates,'' which are
determined by an OMB-approved method based on detailed cost information
submitted by American flagship operators. If U.S.-flag vessels are not
available at fair and reasonable rates, they are not awarded the cargo,
and foreign vessels may be used.
In summary, I again point out that what my amendment seeks to do is
to shift any higher costs of using U.S.-flag ships out of Agriculture
to the Department of Transportation where it rightly belongs. I do,
however, strongly support keeping U.S. jobs here in this

[[Page S11155]]

country. I strongly support making sure that we support a maritime
industry in this country and make sure it is there for us when we need
it in periods of national emergency. I ask support for my amendment to
shift those costs to DOT. I yield the floor and the remainder of my
time.
The PRESIDING OFFICER. Does the Senator from Iowa yield back his
time?
Mr. GRASSLEY. How much do I have?
The PRESIDING OFFICER. One minute twenty-three seconds.
Mr. GRASSLEY. Yes. I yield back.
The PRESIDING OFFICER. Under the previous order, there is 1 minute
now reserved for the Senator from Hawaii and 1 minute for the Senator
from Alaska.
Mr. INOUYE. Mr. President, in June 1992 the Journal of Commerce had
an editorial in support of this program, this bill. In March 1994, a
much stronger editorial was found in the Journal of Commerce supporting
this measure before us. In 1995, the Journal of Commerce was purchased
by the Economist, a British publication, and now in 1996 we find that
the Journal of Commerce is opposed to this measure before us.
Mr. President, I ask unanimous consent that a letter dated May 2,
1996, from Assistant Secretary of the Navy John W. Douglass supporting
this measure be printed in the Record.
There being no objection, the letter was ordered to be printed in the
Record, as follows:

The Assistant Secretary of the Navy, Research Development
and Acquisition,
Washington DC, May 2, 1996.
Hon. Trent Lott,
Seapower Subcommittee, Committee on Armed Services, U.S.
Senate, Washington, DC.
Dear Senator Lott: During the recent Senate Armed Services
Committee Seapower Subcommittee hearing on Navy Surface Ship
Programs, you requested a review from the Navy on the pending
Maritime Reform and Security Act legislation. I have reviewed
this bill, and strongly support the establishment of an
active fleet of militarily useful, privately owned, U.S.-
flagged vessels for our nation's defense, and provisions that
strengthen our vital U.S. maritime industrial base and
Merchant Marine.
This bill is important in helping the U.S. maintain a
strong and responsive defense posture. Through the Emergency
Preparedness Program, the Navy will have access to vessels
during times of war or national emergency thereby enhancing
the readiness of our seagoing forces.
I also view the Maritime Reform and Security Act as
important legislation in supporting U.S. shipbuilders. First,
the bill's preference for including U.S.-built ships and the
requirement to notify U.S. shipbuilders of the intent to
contract for new construction work should help to promote the
stability of shipbuilders supporting the Navy. Second, the
vessel eligibility provision setting limits on the age of
vessels in the fleet will contribute to new construction
orders and maintain a younger, safer fleet. Third, the bill's
provisions that facilitate use of Title XI loan guarantees is
also important to U.S. shipbuilders.
It is paramount that U.S. shipbuilders capture a share of
the world shipbuilding market to help sustain the viability
of this important industry for the Navy's future and to
benefit the Navy by reducing new construction costs. The
success of U.S. shipbuilders in commercial markets is
inextricably linked to programs such as Title XI.
I appreciate the opportunity to provide you with comments
on this imporant maritime legislation. A similar letter has
been sent, as a courtesy, to Senator Pressler, Chairman of
the Committee on Commerce, Science, and Transportation. As
always, if I can be of any further assistance, please let me
know.
Sincerely,
John W. Douglass.

Mr. INOUYE. Mr. President, I also ask unanimous consent that a letter
dated April 9, 1996, from Deputy Secretary of Defense John White,
supporting this measure be printed in the Record, along with a letter
from the Secretary of Transportation, the Hon. Federico Pena,
supporting this measure.
There being no objection, the letters were ordered to be printed in
the Record, as follows:

Deputy Secretary of Defense,
Washington, DC, April 9, 1996.
Hon. Larry Pressler,
Chairman, Committee on Commerce, Science, and Transportation,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: I understand that the Senate may
consider H.R. 1350, the Maritime Security Act, in the very
near future. I want to dispel any questions or concerns about
the position of the Department of Defense with respect to
this legislation. The Department of Defense supports fully
H.R. 1350. the establishment of a Maritime Security Force,
particularly, will greatly enhance the maintenance of an
adequate sealift capability.
Thank you for the opportunity to comment.
Sincerely,
John White.
____

The Secretary of Transportation,

Washington, DC, September 23, 1996.
Hon. Daniel K. Inouye
U.S. Senate, Washington, DC.
Dear Senator Inouye: At your request, I am writing to
present the Administration views on Senator Charles E.
Grassley's amendments to H.R. 1350, the Maritime Security Act
of 1995. The Administration strongly supports Senate passage
of H.R. 1350 without amendment when the Senate votes on this
bill on September 24, 1996. Early enactment of this
legislation is important to national security. The
Administration takes no position on the merits of these
amendments at this time.
The Office of Management and Budget advises that there is
no objection, from the standpoint of the Administration's
program, to the submission of this report.
Sincerely,
Federico Pena.
____

Mr. INOUYE. Mr. President, although the Harkin measure has much
merit, I must advise my colleagues that we have not had a hearing on
this measure. If that amendment is made part of the bill, I feel that
at this lateness it might be the death knell of the measure. So I move
to table.
Mr. STEVENS. I ask for the yeas and nays.
The PRESIDING OFFICER. Does the Senator from Alaska yield his time?
Mr. STEVENS. No. I was asking for the yeas and nays on the motion of
the Senator from Hawaii to table.
The PRESIDING OFFICER. A motion to table is not debatable. It is not
in order at this point until the Senator from Alaska has used or
yielded his time. The motion to table is not in order until the Senator
from Alaska has used or yielded his time.
Mr. STEVENS. That was not the understanding at the time we were going
to make it. We are going to have one vote on Senator Harkin's amendment
and then a separate vote on this one. We were going to make the motion
to table and vote. However the Chair wishes to do it--go back and read
the Record--that is not the understanding. In any event, I will take my
minute on the Grassley amendment, not the Harkin amendment, so we
understand.
The PRESIDING OFFICER. The Senator is recognized.
Mr. STEVENS. This amendment would affect the rates for carriers of
all Government cargoes, not just the rates set for cargo preference on
agricultural cargoes. I remind my friends from Iowa, both of them, that
we put $10 billion into agricultural subsidies a year. We are talking
about here in this bill reducing the cost of keeping this merchant
marine available for our Department of Defense from $200 million a year
to $100 million. For 10 years we will get it to $100 million.
Senator Grassley's plan is unnecessary. Existing law already allows
the military use of foreign-flag vessels if the U.S. carriers' rates
are excessive or otherwise unreasonable or if they are higher than the
charges for transporting like goods for private persons.
In terms of cargo preference, the law already provides the rates must
be fair and reasonable for cargo preference. As I stated Friday, this
amendment will result in the loss of the majority of the U.S.-flag
fleet. We need that for national defense.
I point out that during the Persian Gulf war, the charge for the
foreign ships averaged $174 per short ton and for the domestic fleet it
averaged $122 per short ton. We are preserving a merchant marine fleet
for our defense purposes.
I move to table the Senator's amendment.
Mr. INOUYE. Mr. President, I move to table the Harkin amendment.
Mr. STEVENS. I ask for the yeas and nays.
The PRESIDING OFFICER. Is there a sufficient second? There is a
sufficient second.
The yeas and nays were ordered.
The PRESIDING OFFICER. The question is on agreeing to the motion to
table the Harkin amendment. The yeas and nays have been ordered. The
clerk will call the roll.
The bill clerk called the roll.
Mr. NICKLES. I announce that the Senator from Colorado [Mr. Campbell]
is absent due to illness.
Mr. FORD. I announce that the Senator from Alabama [Mr. Heflin] is
necessarily absent.

[[Page S11156]]

The PRESIDING OFFICER. Are there any other Senators in the Chamber
desiring to vote?
The result was announced--yeas 89, nays 9, as follows:

[Rollcall Vote No. 297 Leg.]

YEAS--89

Abraham
Akaka
Ashcroft
Bennett
Biden
Bingaman
Bond
Boxer
Bradley
Breaux
Bryan
Burns
Byrd
Chafee
Coats
Cochran
Cohen
Coverdell
Craig
D'Amato
Daschle
DeWine
Dodd
Domenici
Exon
Faircloth
Feingold
Feinstein
Ford
Frahm
Frist
Glenn
Gorton
Graham
Gramm
Grams
Grassley
Gregg
Hatch
Hatfield
Helms
Hollings
Hutchison
Inhofe
Inouye
Jeffords
Johnston
Kassebaum
Kempthorne
Kennedy
Kerry
Kohl
Kyl
Lautenberg
Leahy
Levin
Lieberman
Lott
Lugar
Mack
McCain
McConnell
Mikulski
Moseley-Braun
Moynihan
Murkowski
Murray
Nickles
Nunn
Pell
Pressler
Pryor
Reid
Robb
Rockefeller
Roth
Santorum
Sarbanes
Shelby
Simpson
Smith
Snowe
Specter
Stevens
Thomas
Thompson
Thurmond
Warner
Wyden

NAYS--9

Baucus
Brown
Bumpers
Conrad
Dorgan
Harkin
Kerrey
Simon
Wellstone

NOT VOTING--2

Campbell
Heflin

The motion to lay on the table the amendment (No. 5396) was agreed
to.

Tribute to Senator Simon

Mr. DASCHLE. Mr. President, to say that the senior Senator from
Illinois, Senator Simon, has influenced us all is an understatement.
Our dress today is a recognition of his influence on all of us and our
great admiration for him personally.
I would like to announce that following the vote many of us will
participate in a tribute to Senator Simon. I invite all of our
colleagues to join Senator Moseley-Braun, Senator Mack, and many of us
in that tribute. We will not do it now. We will do it later. In the
meantime, we will all enjoy wearing these great bow ties.
Mr. STEVENS. Mr. President, I move to reconsider the vote by which
the motion was agreed to.
Mr. LOTT. I move to lay that motion on the table.
The motion to lay on the table was agreed to.
Mr. KYL. Mr. President, I rise to support the amendments being
offered by Senator Grassley and to express my concerns about this bill.
Members of the 104th Congress have tried their best to eliminate pork-
barrel spending and corporate welfare. I believe we have made some
progress, but clearly, as this bill demonstrates, we have a long way to
go.
I support the amendments offered by my colleague from Iowa because
this bill is nothing more than a taxpayer subsidy. It authorizes $100
million per year for the maritime fleet to provide sealift capacity in
times of national emergency. Each vessel in the program would receive
$2.1 million per year for being enrolled in the program. This does not
include the additional moneys that may be paid in times of war. The CBO
estimates that the program will cost $782 million in the first 5 years,
including expenditures for the phasing out of the old system.
The bill has several problems. First, it does not allow the United
States to requisition subsidized U.S. ships in a national emergency. It
would allow U.S. flag-carriers to protect specific vessels from
shipping materials to a war zone. If commercial interests determine
which vessels go and when, we should pay them on an as-needed basis. We
shouldn't pay for a benefit we don't receive.
Second, the bill does not require those seafarers who are in the
Maritime-Security fleet to serve when called. During the Persian Gulf
war, our country had to draw from a pool of retired merchant mariners
to care for our fleet. That is wrong and it should be changed.
Under this program, merchant mariners can earn more money than their
military counterparts for war-time pay. The bill should be corrected to
make merchant-mariners bonuses commensurate with those of the Army,
Navy, Air Force, and Marines. I have been told of one merchant mariner
who was paid thousands of dollars for a few months worth of service
during the Persian Gulf war. Most enlisted military officers received
far less than that.
Finally, the bill must require those carriers who receive a taxpayer
subsidy to carry war materials into the war zone. The maritime fleet
must not be allowed to drop off war materials to commercially
convenient spots. If the taxpayers are paying for this service, then it
is our duty to ensure that they receive what they are paying for.
Mr. President, the defects of the bill are not figments of the
imagination conjured up by a few budget hawks. The Vice President's
National Performance Review recommended that all maritime subsidies be
ended for a savings of $23 billion over a 10-year period. The
Department of Transportation's inspector general concluded that the
entire Maritime Administration and all of its U.S.-flag subsidies
should be terminated. The Office of Management and Budget estimates
that international cargo preference laws will cost Federal Government
agencies an additional $600 million in fiscal year 1996. A November
1994 GAO report said that cargo-preference policies support at most
6,000 of the 21,000 mariners in the U.S. merchant marine industry. That
is an annual cost of $100,000 per seafarer--at taxpayer expense.
Additionally, Citizens Against Government Waste, the National Taxpayers
Union, and Americans for Tax Reform are opposed to the bill.
The Federal debt is more that $5 trillion. Five years ago, the debt
was $3.6 trillion. Clearly, Government spending is out of control and
Congress must place priorities in the way it spends taxpayer dollars.
Most families live under a budget. Most have a limited amount of
resources that they must spend on food, clothing, shelter, and the
like. And many families have little left over for the extras in life.
They don't spend for every whim because they know that they must stay
within their means. Why can't Congress do the same? Why can't Congress
spend the people's money on core tasks only. Why can't Congress forgo
the extras?
It will take a colossal effort to control the Government's debt. But
every long journey begins with the first step. I urge my colleagues to
take that first step and vote against this bill. I thank the chairman
and ranking member for the opportunity to express my concerns.
Mr. STEVENS. Mr. President, there are three votes remaining. One is
the Grassley amendment. There is a second Grassley amendment, and then
final passage, hopefully, on the bill.
I ask unanimous consent--this has been cleared--that each of these
votes be a 10-minute vote.
The PRESIDING OFFICER. Is there objection?
Without objection, it is so ordered.
The yeas and nays have not been ordered.

Amendment No. 5393

Mr. STEVENS. I move to table the Grassley amendment, and I ask for
the yeas and nays.
The PRESIDING OFFICER. Is there a sufficient second? There is a
sufficient second.
The yeas and nays were ordered.
The PRESIDING OFFICER. The question is on agreeing to the motion of
the Senator from Alaska to lay on the table the amendment of the
Senator from Iowa. On this question, the yeas and nays have been
ordered, and the clerk will call the roll.
The assistant legislative clerk called the roll.
Mr. NICKLES. I announce that the Senator from Colorado [Mr. Campbell]
is absent due to illness.
Mr. FORD. I announce that the Senator from Alabama [Mr. Heflin] is
necessarily absent.
The PRESIDING OFFICER. Are there any other Senators in the Chamber
who desire to vote?
The result was announced--yeas 65, nays 33, as follows:

[Rollcall Vote No. 298 Leg.]

YEAS--65

Akaka
Bennett
Biden
Bingaman
Boxer
Bradley
Breaux
Bryan
Byrd
Chafee
Cochran
Cohen
Conrad
Coverdell
D'Amato
Daschle
DeWine
Dodd
Domenici
Dorgan
Exon
Feingold
Feinstein
Ford
Frist
Glenn
Gorton
Graham
Harkin
Hatch
Hatfield
Hollings
Hutchison

[[Page S11157]]

Inouye
Jeffords
Johnston
Kennedy
Kerrey
Kerry
Lautenberg
Leahy
Levin
Lieberman
Lott
Mack
Mikulski
Moseley-Braun
Moynihan
Murkowski
Murray
Nunn
Pell
Reid
Robb
Rockefeller
Santorum
Sarbanes
Shelby
Simon
Snowe
Specter
Stevens
Thurmond
Warner
Wyden

NAYS--33

Abraham
Ashcroft
Baucus
Bond
Brown
Bumpers
Burns
Coats
Craig
Faircloth
Frahm
Gramm
Grams
Grassley
Gregg
Helms
Inhofe
Kassebaum
Kempthorne
Kohl
Kyl
Lugar
McCain
McConnell
Nickles
Pressler
Pryor
Roth
Simpson
Smith
Thomas
Thompson
Wellstone

NOT VOTING--2

Campbell
Heflin

The motion to lay on the table was agreed to.
Mr. STEVENS. Mr. President, I move to reconsider the vote by which
the motion was agreed to.
Mr. INOUYE. I move to lay that motion on the table.
The motion to lay on the table was agreed to.
Mr. STEVENS. Mr. President, may we have order now? We have one more
vote.

Amendment No. 5394

The PRESIDING OFFICER. Under the previous order, there will be 1
minute for the proponents of the amendment and 1 minute for opponents
of the amendment, followed by a vote.
The Senator from Iowa.
Mr. GRASSLEY. Mr. President, my amendment says that H.R. 1350
subsidies, and that is $1 billion in total, cannot be used for campaign
contributions, cannot be used for lobbying and cannot be used for so-
called public education. Congress has supported similar restrictions on
different bills and programs in the past, but we have no such
restrictions for this $1 billion subsidy in this bill.
It was suggested last week that we provide for this. It could be done
by a line item. If that is what is wanted, then I suggest to the
proponents to put that in the bill, but it isn't in the bill.
So, consequently, I think we should make sure we don't allow these
funds to be back-doored by the Maritime Administration for campaign
contributions and for lobbying. Without this restriction, that is not
certain.
I yield back the remainder of my time.
The PRESIDING OFFICER. The Senator from Alaska.
Mr. STEVENS. Mr. President, there is a Corrupt Practices Act. As a
matter of fact, the $10 billion paid out of agricultural subsidies has
no similar provision. This amendment is unnecessary. It is a killer
amendment trying to convince Members to vote for amendments so the bill
will go back to the House and die.
The purpose of this bill is to save $100 million a year and to
continue the program of keeping the merchant marine available for the
United States in time of emergency. It will cost $100 million a year
for 10 years under this bill, not $1 billion, as that article on your
desks says; $100 million a year for 10 years.
I move to table this amendment and ask for the yeas and nays.
The PRESIDING OFFICER. Is there a sufficient second?
There is a sufficient second.
The yeas and nays were ordered.
The PRESIDING OFFICER. The question is on agreeing to the motion to
lay on the table the amendment No. 5394. The yeas and nays have been
ordered. The clerk will call the roll.
The legislative clerk called the roll.
Mr. NICKLES. I announce that the Senator from Colorado [Mr. Campbell]
is absent due to illness.
Mr. FORD. I announce that the Senator from Alabama [Mr. Heflin] is
necessarily absent.
The PRESIDING OFFICER (Mr. DeWine). Are there any other Senators in
the Chamber desiring to vote?
The result was announced--yeas 50, nays 48, as follows:

[Rollcall Vote No. 299 Leg.]

YEAS--50

Akaka
Bennett
Biden
Bingaman
Breaux
Bryan
Chafee
Cochran
Cohen
Coverdell
D'Amato
Daschle
DeWine
Dodd
Dorgan
Exon
Feinstein
Ford
Frist
Glenn
Gorton
Graham
Hatfield
Hollings
Inouye
Jeffords
Johnston
Kennedy
Kerrey
Leahy
Levin
Lieberman
Lott
Mack
McCain
Mikulski
Moseley-Braun
Moynihan
Murray
Pell
Pryor
Reid
Robb
Rockefeller
Sarbanes
Specter
Stevens
Thurmond
Wellstone
Wyden

NAYS--48

Abraham
Ashcroft
Baucus
Bond
Boxer
Bradley
Brown
Bumpers
Burns
Byrd
Coats
Conrad
Craig
Domenici
Faircloth
Feingold
Frahm
Gramm
Grams
Grassley
Gregg
Harkin
Hatch
Helms
Hutchison
Inhofe
Kassebaum
Kempthorne
Kerry
Kohl
Kyl
Lautenberg
Lugar
McConnell
Murkowski
Nickles
Nunn
Pressler
Roth
Santorum
Shelby
Simon
Simpson
Smith
Snowe
Thomas
Thompson
Warner

NOT VOTING--2

Campbell
Heflin

The motion to lay on the table the amendment (No. 5394) was agreed
to.
Mr. STEVENS. I move to reconsider the vote.
Mr. INOUYE. I move to lay that motion on the table. The motion to lay
on the table was agreed to.
Mr. LOTT. Mr. President, America has relied upon its merchant marine,
ports and maritime industries for both trade and defense since colonial
days.
Today, we will vote to ensure that America will continue its maritime
community into the 21st century.
Today, we recognize that America as a nation must make an investment
in its maritime infrastructure.
Today, we will vote for a program which is an efficient and flexible
policy that will allocate scarce public resources in a responsible
manner.
This program will also guarantee that our Nation will have trained
Americans to crew these vessels as well as the Department of Defense's
pre-positioned and Ready Reserve Fleet.
This program will significantly reduce the cost of the Federal
maritime operating assistance programs. We are talking about cutting
the funding in half.
This program will eliminate outdated and unnecessary rules and
regulations which limits and restricts the ability of U.S. flag vessels
to compete and modernize their fleets.
I want to take just a moment and recognize the hard work of
Congressman Herb Bateman and Senators Stevens, Inouye, Hollings and
Breaux.
This has been a real team effort. These Members of Congress were
actively involved in crafting and advancing this legislation. The
journey for maritime reform started over two decades ago.
This particular bill has been on a 9-year legislative trip with over
50 hearings. Its time has come.
I also want to recognize the work of staff who assisted the process:
Rusty Johnston, Jim Schweiter, and Bob Brauer of the House's National
Security Committee; Earl Comstock of Senator Steven's staff; Jim
Sartucci and Carl Bentzel of the Senate's Commerce Committee; and
Margaret Cummisky of Senator Inouye's staff.
The full Senate has devoted nearly two full days for a spirited
dialogue on this legislation. And, the Senate has considered a wide
range of amendments. The bill is ready for vote on final passage.
I stand here today on the Senate Floor and proudly ask my colleagues
to support the Maritime Security Program to guarantee that our Nation
will have the nucleus of a modern, militarily useful active commercial
vessels sailing under the American flag.
This vote will ensure that whenever the United States decides to
project American forces overseas for either an emergency or national
defense, there will be a maritime lifeline. I firmly believe that
Congress has a duty and responsibility to guarantee that a real and
viable maritime lifeline is maintained and provided.
We are the world's only remaining superpower and we have global
interests and responsibilities. A healthy maritime community is
essential for this role.
I stand here today representing a bill that enjoys wide and deep
bipartisan support. It deserves your support and your vote.
The PRESIDING OFFICER. The clerk will read the bill for the third
time.
The bill was read the third time.
Mr. STEVENS addressed the Chair.
The PRESIDING OFFICER. The Senator from Alaska.

[[Page S11158]]

Mr. STEVENS. My information is, this is the last vote. After that
last courageous vote, I hope that all Members will remember this is
national defense--national defense--keeping ships available for
emergencies, saving $100 million a year. I urge the Senate to vote
positively on this bill. I ask for the yeas and nays.
The PRESIDING OFFICER. Is there a sufficient second? There is a
sufficient second.
The yeas and nays were ordered.
The PRESIDING OFFICER. The bill having been read the third time, the
question is, Shall the bill pass? The yeas and nays have been ordered.
The clerk will call the roll.
The assistant legislative clerk called the roll.
Mr. NICKLES. I announce that the Senator from Colorado [Mr. Campbell]
is absent due to illness.
Mr. FORD. I announce that the Senator from Alabama [Mr. Heflin] is
necessarily absent.
The PRESIDING OFFICER. Are there any other Senators in the Chamber
desiring to vote?
The result was announced--yeas 88, nays 10, as follows:

[Rollcall Vote No. 300 Leg.]

YEAS--88

Abraham
Akaka
Ashcroft
Baucus
Bennett
Biden
Bingaman
Bond
Boxer
Bradley
Breaux
Brown
Bryan
Bumpers
Byrd
Chafee
Cochran
Cohen
Conrad
Coverdell
Craig
D'Amato
Daschle
DeWine
Dodd
Domenici
Dorgan
Exon
Faircloth
Feingold
Feinstein
Ford
Frahm
Frist
Glenn
Gorton
Graham
Gramm
Gregg
Harkin
Hatch
Hatfield
Helms
Hollings
Hutchison
Inhofe
Inouye
Jeffords
Johnston
Kassebaum
Kempthorne
Kennedy
Kerrey
Kerry
Kohl
Lautenberg
Leahy
Levin
Lieberman
Lott
Mack
McCain
McConnell
Mikulski
Moseley-Braun
Moynihan
Murkowski
Murray
Nunn
Pell
Pressler
Pryor
Reid
Robb
Rockefeller
Santorum
Sarbanes
Shelby
Simon
Simpson
Smith
Snowe
Specter
Stevens
Thurmond
Warner
Wellstone
Wyden

NAYS--10

Burns
Coats
Grams
Grassley
Kyl
Lugar
Nickles
Roth
Thomas
Thompson

NOT VOTING--2

Campbell

Heflin
The bill (H.R. 1350) was passed.
Mr. STEVENS. Mr. President, I move to reconsider the vote.
Mr. LOTT. I move to lay that motion on the table.
The motion to lay on the table was agreed to.
The PRESIDING OFFICER. The majority leader.
Mr. LOTT. Mr. President, once again I want to commend two of the most
outstanding bill managers we have in the U.S. Senate, the great Senator
from Alaska, Senator Stevens, and the great Senator from Hawaii,
Senator Inouye. They have done yeoman's work on this bill and bills
last week. So we are looking for another hard job for them to do that
we will call on them to do before this week it out. Thank you very much
for getting this bill passed.

____________________