Evening star., 1938-02-18
Marine
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by the Maritime Commission only with
each of the others disapproving on va
rious grounds.
Conferring with members OF the
Senate Labor Committee were Gerard
D. Reilly, solicitor of the Labor De-
partment: Charles Fahy, general coun-
sci Of the Labor Board, and U. B.
Geaslin, Maritime Commission at
torney.
Mr.. Kennedy's departing note of
pessimism about the merchant marine
problem was contained in his letter of
resignation, made public today as he
took the oath of Office as Ambassador
to Great Britain.
Problem Far From Solved"
II should like to report in relin-
gushing my post" he wrote, that the
Ills OF American shipping had been
cured and that the future is filled with
promise. Candor compels me to say.
however that the shipping problem is
FAR from solved and that it is going to
take some exceedingly strenuous meas
ures on the part of the United States
to preserve fleet of anything like the
present proportions in either foreign
or domestic trade
The present commission has been
in Office about 10 months. We have
endeavored to clear away the debris of
the mail contract system, to evaluate
the Merchant Marine as it is today and
to chart course for its rehabilitation
There remain, however, several vital
problems that must be solved before
the United States can hope to get
anywhere at sea.
One OF the most disturbing prob
lens with which the commission has
been confronted is the situation with
regard to labor, The employer EN-
ploye relationship must be stabilized
II American shipping is to survive.
Need for Requirements.
"The other major problem of OUR
merchant marine is the urgent need
for replacements. have already dis
cussed with you the dilemma presented
by recent increases in shipbuilding
costs. The commission is making a
careful study of this situation and will
undoubtedly evolve a solution in the
very near future
In accepting the resignation. the
President made no mention of the
maritime situation. but paid unuuali.
fed tribute to Mr.. Kennedy as two
listed, hard-hitting executive"
Citing bids received for II cargo
vessels of the so-called CO design
Mr.. Kennedy informed the President
yesterday that all but two of the bids
were excessive. The two exceptions.
he explained. were submitted by small
yards, about whose responsibility
there is grave doubt" The figures
ranged from sl,856,675 to s3,4OO,O0O.
The commissions technical data
indicate that the CO ship should not
cost more than $l,800,O0O to s2,OOO.-
000," he added
At press conference later in the
day the commission chairman admit
ted that the scrapping of all bids is
being considered, the only remaining
question evidently being determination
Of ability Of the two small yards to do
the work = awarded the jobs.
Foreign Costs Cited.
Further, he said, the domestic bids
are far out of line with foreign costs,
estimates for comparable construction
IN Belfast, Ireland, being about one
third of the top quoted prices here.
Mr.. Kennedy expressed the opinion
that the price trend shown will force
an upward revision of estimates on the
naval building program.
To the President Mr. Kennedy Of
fered five alternatives, accompanied
by no recommendations as to which
Is most desirable. They follow:
One is to pay the prices asked by
the larger yards. That, I believe.
would be a mistake A merchant
marine built at such prices as those
quoted on the CO vessel would COL
lapse of its own weight.
Another course would be to build
In the navy yards. This probably
will not prove to be practicable. The
navy yards are organized for naval
work and would find it uneconomical
to work OH merchant vessels, espe-
cially the smaller types. These yards,
moreover, are needed for naval work.
"A third course open to the Gov
ernment would be the rehabilitation
Of private facilities. 1t might even
be necessary to establish new yards,
although this would involve the dam
ger of overexpansion.
Work Abroad Suggested.
"A fourth course would be to per-
NIT American operators to build
abroad. The commission has already
proposed that certain subsidized con-
struction be given to foreign yards
whenever American prices are more
than twice those available abroad.
Mr.. Roosevelt said today that several
members of Congress had favored the
fourth course, but warned they could
not support it openly.
THE commission. as last resort,
could ask authority to build ships
itself"