Breach in the Dike

A squat little Japanese freighter, the Taian Maru, churned through the Pacific last week on a historic journey. On its way from Coos Bay, Ore., to Puerto Rico with a load of Pacific Northwest lumber, the Taian Maru is the first foreign flag ship in more than four decades to carry cargo from one U.S. port to another.

Since 1920 the Jones Act, designed to preserve the U.S. coastwise fleet so that it will be available during national emergencies, has awarded all trade between U.S. ports to American ships, regardless of the higher cost to U.S. shippers. The consequences to the Northwest's lumber industry have been disastrous (TIME, Oct. 26).

Canadian lumbermen using lower-cost foreign ships walked away with U.S. lumbermen's East Coast business, and Canadian softwood lumber exports to Puerto Rico have increased seventyfold since 1951 while the Pacific Northwest's share shriveled to nothing. Finally, in a desperation move to save the lumber industry, Congress last year amended the Jones Act to allow lumber to go to Puerto Rico on foreign bottoms for a one-year trial period.

Matter of Time. While lumbermen rejoiced, a chill went through U.S. shipowners. "This is the first breach in the dike." said Pacific Maritime Association President J. Paul St. Sure. Shipping men fear that it is just a matter of time before other industries--sugar, newsprint, iron and steel pipe, petroleum--try for the same concessions. Yet shipowners know that the Jones Act has failed miserably in its effort to isolate U.S. shipping from the inevitable tides of economics.

Through the years, the cost of replacing ships with new ones built in the U.S. (required by the Jones Act to aid U.S. shipyards) has risen until it is twice that of building a Japanese ship. And low-wage foreign flag vessels operate for about $800 a day v. a U.S. ship's $1,900. Small wonder the Taian Maru is hauling the Coos Bay shipment for $40 per 1,000 board feet --$17 less than the lowest U.S. bid.

Adding to U.S. shippers' woes, trucks and trains have stepped in with more convenient and sometimes lower-cost service. Result: since 1938 the number of dry-cargo ships running between U.S. ports has dropped from 379 to 100, and the number of tankers--which are feeling the competition of pipelines and oil imports --from 266 to 207. Last year such venerable lines as Luckenbach and Pope Talbot dropped out of intercoastal business altogether.

Piggyback by Sea. Some shipowners argue pessimistically that nothing can save the coastwise fleet from extinction; others, insisting that it must be saved for reasons of national defense, advocate direct Government subsidies. But more than half the U.S. ships in overseas trade are already on subsidy to the tune of $300 million to keep them competitive with low-wage foreign flag vessels, and that has not prevented a steady decline in the fleet--from 933 to 542 in ten years.

A solution more in line with economic realities seems to lie in the new highly efficient ships of McLean Industries' Sea-Land Shipping Service. Its ships piggyback up to 476 neatly stacked highway truck trailers (it has its own fleet of 5,000 truck tractors and 8,000 trailers) to ports along the East Coast, drop them off in a sixth of the time that it takes to unload a normal ship. Sea-Land converted its first ship to take trailers in 1956, now has 13 converted, all operating at a profit. Such ships represent an early step toward the millennium envisioned by starry-eyed marine architects, when nearly crewless, automated ships will sail the oceans.

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