[Congressional Record Volume 143, Number 142 (Tuesday, October 21, 1997)]
[Senate]
[Page S10881]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                      THE FMC DID THE RIGHT THING

  Mr. LOTT. Mr. President, I rise to congratulate the Federal Maritime 
Commission [FMC] for doing the right thing about Japan's ports. This 
action was not unexpected by the Japanese carriers, but I am sure many 
were surprised with the FMC's dedication to seeing this through. During 
the past few days, the Nation watched as a long running dispute between 
Japan and those countries whose ships call on Japan's ports appears to 
have been resolved.
  Japan's ports are widely known as the most inefficient and expensive 
in the developed world. Additionally, Japan's port system discriminates 
against non-Japanese ocean carriers.
  Mrs. HUTCHISON. For many years, the United States has attempted to 
negotiate commonsense changes to this system with Japan. Japan also 
faced criticism from the European Union. However, no progress was made 
until earlier this year when the FMC voted to assess $100,000 fines 
against Japanese ocean carriers for each United States port call. It is 
reasonable for the United States to collect fines from the Japanese 
shipping lines. Before these fines were to be imposed, the Government 
of Japan agreed to make the necessary changes. The FMC judiciously gave 
Japan until August 1997 to work out these changes. When Japan failed to 
meet this generous deadline, the fines automatically went into effect. 
By last week, the Japanese ocean carriers had missed the FMC's deadline 
to pay the first $5 million in fines. Realizing that Japan would not 
follow through on its promise to fix its port system unless stronger 
measures were imposed, the FMC voted last week to deny the same 
Japanese ocean carriers entry to and exit from United States ports.
  Mr. LOTT. Mr. President, this firm action has had the desired effect.
  An agreement between the United States and Japan on the port issue 
has been reached. The FMC's order will not have to be carried out, but 
it was vital to ensuring that Japan's discriminatory port practices are 
ended. International trade only works when trading partners treat each 
other fairly. Diplomatic solutions only work when both sides live up to 
their commitments, and this only occurs when nations know there are 
genuine consequences to inaction.
  The FMC's active role in the port dispute ensured that United States 
ocean carriers will be treated fairly in Japan. I want to personally 
recognize Harold Creel, the Chairman of the FMC, and FMC Commissioners 
Ming Hsu, Del Won, and Joe Scroggins for their efforts to resolve the 
Japanese port dispute in a firm, yet fair, manner.
  Clearly, the FMC has both the responsibility and the authority to 
take the action. And, the Commissioners approached their decision in a 
thoughtful and measured way.
  I also want to thank the other members of the negotiation team, in 
particular, the Maritime Administration which provided much needed 
maritime expertise.
  Mrs. HUTCHISON. I want to add my congratulations to the FMC, the 
Maritime Administration, and the administration as well. The resulting 
improvements in Japan's port practices will benefit not only U.S. ocean 
carriers, but other ocean carriers and the shippers of the world 
trading through Japan's ports.
  Mr. LOTT. I would also note that the authority under which the FMC 
took these actions, section 19 of the Merchant Marine Act, 1936, and 
the independence of the U.S. Government's international shipping 
oversight agency would be preserved under S. 414, the Ocean Shipping 
Reform Act of 1997. Under this bill, the action would be carried out by 
the U.S. Transportation Board, an expanded and renamed Surface 
Transportation Board. To those who expressed concerns that this 
multimodal board would be unwilling or unable to be an effective 
regulator of the maritime industry, I tell them to look at the Surface 
Transportation Board's record of making tough decisions with regard to 
the mergers of the largest railroads in the United States. When 
provided with similar maritime expertise, this combined board will 
certainly have the ability and willingness to protect the interests of 
the United States in international maritime disputes.
  Mrs. HUTCHISON. The Majority Leader is correct. S. 414 does not limit 
the United States' ability to address similar situations in the future. 
The U.S. Transportation Board would have the same authority, 
independence, and I believe the same willingness, to protect America's 
interests as the FMC.

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