Annual Report of the FEDERAL MARITIME BOARD MARITIME ADMINISTRATION 1951 UNITED STATES DEPARTMENT OF COMMERCE UNITED STATES DEPARTMENT OF COMMERCE I , CHARLES SAWYER, Secretary /-i ' ,) ' t Washington, D. C. I U-r) '3 l ,. [jl ''"~ • I FEDERAL MARITIME BOARD EDwARD L. CocHRANE, Chairman RoBERT W. WILLIAMS, Vice Chairman ALBERT w. GATOV A. J. WILLIAMs, Secretary MARITIME ADMINISTRATION EDwARD L. CocHRANE, 111.aritime Administrator EARL W. CLARK, Deputy Maritime Administrator For sale by the Superintendent of Documents, U. S. Government Printing Office Washington 25, D. C. • Price 35 cents (paper cover) ...:lt-~~ 2409' Letters of Transmittal UNITED STATES DEPARTMENT OF COMMERCE, MARITIME ADMINISTRATION, Washington 25, D. C., January 1, 1952. To: The Secretary of Commerce. FRoM: Chairman, Federal Maritime Board, and Administrator; Mari­ time Administration. SuBJECT: Annual Report for fiscal year 1951. I am submitting herewith the report of the Federal Maritime Board and Maritime Administration for the fiscal year ending June 30, 1951. This report covers the first full year of operation of these two agencies. It has been a year which once more has demonstrated the importance of the merchant marine to the national economy and defense. E. L. CocHRANE, ' Chairman, Federal Maritime Board, and Maritime Administrator. THE SECRETARY oF CoMMERCE, Washington 25, D. C. To the Congress: I have the honor to present the annual report of the Federal Mari­ time Board and Maritime Administration of the United States Depart­ ment of Commerce for the fiscal year ended June 30, 1951. Secretary of Commerce. iii Table of Contents INTRODUCTION Page INTRODUCTION____________________________________________________ 1 The need for ships_____________________________________________ 1 The initial "breakout"_________________________________________ 2 The National Shipping Authority________________________________ 3 A start toward a modern fleet__ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 4 Tankers for defense____________________________________________ 6 Maritime strength for the free world_____________________________ 6 Men to man the ships__________________________________________ 7 Shoreside facilities_____________________________________________ 8 The basic task_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 9 Reorganization________________________________________________ 9 Backlogs_____________________________________________________ 10 Ship construction subsidies_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 10 Postwar operating subsidies_____________________________________ 11 FISCAL YEAR ACTIVITIES NATIONAL SHIPPING AUTHORITY------------------------------------- 13 ·General agency activities_______________________________________ 15 Charters______________________________________________ __ _ _ _ _ _ _ 17 General agency vessels_________________________________________ 18 Ship repair and maintenance_____________________________________ 19 Reservefleets_________________________________________________ 21 Development of fleet sites ___ ----------------------------------- 21 Fleet service activities__________________________________________ 21 Vessel preservation_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _ _ _ _ _ _ 22 Research and tests_____________________________________________ 22 Tanker services___ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 23 AIDs To SHIPPING_________________________________________________ 24 Calculation of construction subsidies_____________________________ 24 Construction-differential subsidy aid______________________________ 25 Calculation of operating subsidies________________________________ 27 Operating-differential subsidy rates for the years 1949 to 195L_ __ _ _ _ 28 Operating-differential subsidy aid________________________________ 28 Construction financing aid without subsidy, and trade-ins__________ 32 Construction reserve funds______________________________________ 32 Federal Ship Mortgage Insurance aid__ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 33 Miscellaneous_________________________________________________ 33 STUDIES AND REPORTS_____________________________________________ 35 Vessel data_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 35 Reports---------~-------------------------------------------- 35 Cargo data___________________________________________________ 37 Special stud~s------------------------------------------------ 38 Labor data___________________________________________________ 38 Trade rou les ____________________________________________ - _ _ _ _ 38 v Page SHIPBUILDING ________ """~·-·---·-·---"-"-"-"-"-------------------- 40 New construction _____________________________________________ _ 40 Material controL _____________________________________________ _ 41 Conversions _________________________________________________ _ 42 Technical developments _______________________________________ _ 42 Scientific equipment _____________________ c ____________________ _ 44 Vessel trial and gu~rantee surveys ______________________________ _ 44 SHIP SALES AND TRANSFERS---------------------------------------- 45 Merchant Ship Sales Act of 1946, as amended ____________________ _ 45 Merchant Marine Acts of 1936 and 1920 ________________________ _ 45 Transfers to foreign ownership and/or registry ____________________ _ 46 Disapprovals _________________________________________________ _ 47 New construction _____________________________________________ _ 47 General Order 58, second revision _______________________________ _ 47 Mortgages to aliens ___________________________________________ _ 48 Charters to aliens ____________________________________________ _ 48 Violations ___________________________________________________ _ 48 Surrender of marine documents _________________________________ _ 48 PERSONNEL ___ ------------------------------------ ----- - ----- ~----- 49 Safety program _______________________________________________ _ 49 . MARITIME LABOR RELATIONS _________ ·----------------------------- 51 Seamen------------------------------------------------------ 51 Shipyard labor _______________________________________________ _ 53 MARITIME TRAINING ______________________________________________ _ 54 Cadet-midshipmen ____________________________________________ _ 54 United States Maritime Service ______________ ·- ________________ _ 55 Medical program ___________________________________________ .. __ 56 Seamen services _________________________ .. _____________ --------- 56 PRoPERTY AND SuPPLY---------------------------~---------------- 57 Shipyards ___________________________________________________ _ 57 Terminals ___________________________________________________ _ 58 vVarehouses __________________________________________________ _ 58 Port development __ ... - .. __ .. _ ........ - _.. _.. _ ....... ______ .. _ .. ___ .. _ ........ __ _ 59 Miscellaneous_____________________________ __ _ _ _ _ _ _ ______ .. ___ _ 59 Inventories ______________________ ---------------------------- 60 Industrial mobilization planning _____ --- .. _-- ____ -----_ .. --- .. ------ 60 Disposal of surplus property _____ - ___ .. ___ -- _ .. _.. __ .. --_----------- 61 Domestic freight traffic _________________________ ------------- __ .. 61 Material controL _________ .... _____ .. _______ .. _________ ... _- ___ ----_ 61 Purcha~ng--------------~------------------------------------ 61 FINANCE--------------------------------------------------------- 62 Internal audits and procedures staff ...... _____ .. __________ -- ______ --_ 62 Accounting __________________________________________________ _ 62 Auditing __ - .... ___ .. ---------------------------- .. --------------- 63 Insurance _________________ - ____ ------ ... -- __ ------------------ - 64 Analysis of financial statements ...... _- __ .. -_ .. - ____ - .. -_ .. ------------ 66 Reserve funds of subsidized operators ........ ----.. -- .. ---------------- 66 CLAIMS .. ---------------------- ------------------------------ .. ----- 68 LEGAL AcTIVITIEs ________________________________________________ _ 70 Legislation _____ .. __ ------------------------------------------- 70 Contracts---------------------------------------------------- 72 Litigation, claims, and renegotiation_ - __ ---- ___ ------------------ 75 Regulation __________________________________________________ _ 76 Admiralty and labor law------_-_------------------------------- 76 vi LEGAL AcTIVITIEs--Continued Page Just compensation __________________________________ _ 78 Tort claims _________________________________________ ~~~~~~~~~~ 78 REGULATION OF CARRIERS 79 79 ~:;~]~;;~~,:;,;,ro;:~;~:---:-~ ::-:--~ -~ ~- ~-~~· _: 80 80 Freight forwarders______________________________ _ 80 Freight rates-United States Territories and possessi~~s~~~~~~~~~~~~ 81 I>ockets _____________________________________________________ _ 81 HEARINGS BEFORE TRIAL EXAMINERS 82 Final decisions of the Board _____ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ 82 Recommended decisions of hearing examiners ____________________ _ 86 Pending proceedings __________________________________________ _ 87 INTERNATIONAL MARITIME AFFAIRS ________________________________ _ 90 FINANCIAL STATEMENTS EXHIBIT 1: Balance Sheet-June 30, 195L___ _ _ _ _ _ _ _ __ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ 93 EXHIBIT