Section 5 of said Intercoastal Shipping Act, 1933, is amended to read as follows: "SEC. 7. That the provisions of the Shipping Act, 1916, as amended, shall in all respects, except as amended by this Act, continue to be applicable to every carrier subject to the provisions of this Act." The Intercoastal Shipping Act, 1933, is further amended by striking out the words "SEC. 6" and inserting in lieu thereof the words "SEC. 8." SEC. 44. The Merchant Marine Act, 1936, is hereby amended by adding a new section at the end of title II thereof, to be known as section 216 and to read as follows: "SEC. 216. (a) The Commission is hereby authorized and directed to establish a system for the training of citizens of the United States to serve as licensed and unlicensed personnel on American merchant vessels, and may employ as instructors, on a contract or fee basis, such qualified licensed and unlicensed personnel of the merchant marine as the Commission may deem necessary to effectuate the purposes of this section. "(b) The Commission is hereby authorized and directed, under such rules and regulations as it may prescribe, to establish the United States Maritime Service which shall consist of such licensed and unlicensed personnel of the United States merchant marine as may be enrolled under the provisions of this section. The ranks, grades, and ratings for the personnel of the Maritime Service shall be the same as are now or shall hereafter be prescribed for the personnel of the Coast Guard. The Commission is authorized and directed to determine the number of persons to be enrolled in the Maritime Service, to fix the rates of pay of such persons, and to prescribe such courses and periods of training as, in its discretion, is necessary to maintain a trained and efficient merchant-marine personnel. "(c) The Commission, with the consent of any executive department, independent establishment, or other agency of the Government, including any field service thereof, may avail itself of the use of information, services, facilities, officers, and employees thereof in carrying out the provisions of this section." SEC. 45. The Merchant Marine Act, 1936, is hereby amended by adding a new title to be known as title X and to read as follows: TITLE X "SEC. 1001. For the purposes of this title "(a) The term 'maritime employer' means any person not included in the term 'carrier' in title I of the Railway Labor Act who (1) is engaged in the transportation by water of passengers or property between the United States or any of its districts, Territories, or possessions and a foreign country, or engaged in the transportation by water of passengers or property on the high seas or the Great Lakes from one State, Territory, district, or possession of the United States to any other State. Territory, district, or possession of the United States; (2) is engaged in towboat, barge, or lighterage service in connection with the transportation by water of passengers or property as set forth in clause (1) hereof; (3) operates or manages or controls the operation or management of any wharf or pier or any dock or any water space for the accommodation of vessels engaged in the transportation by water of passengers or property as set forth in clause (1) hereof; (4) is engaged in the business of loading or unloading vessels engaged in the transportation by water of passengers or property as set forth in clause (1) hereof; or (5) operates any equipment or facilities directly connected with the services set forth in clauses (1), (2), (3), and (4) hereof. The United States Maritime Commission is hereby authorized and directed, upon request of the Mediation Board, to determine, after investigation, whether any employer is a maritime employer within the meaning of this subsection. "(b) The term 'employee' means any person who performs any work as an employee or subordinate official of any maritime employer subject to its authority to supervise and direct the manner of rendition of service when the duties assigned to or services rendered by such employee directly or indirectly, in any manner, affect, relate to, or are concerned with the transportation by water of passengers or property as set forth in clause (1) of subsection (a) of this section; or the furnishing of equipment and facilities therefor or services thereto as set forth in clauses (2), (3), (4), and (5) of subsection (a) of this section; it being intended that this title should apply not only to those persons whose work may be exclusively in connection with the movement of passengers and property in the interstate and foreign com merce of the United States but also to those persons whose work may have such a close relation to the movement of such interstate and foreign commerce that the provisions of this title are essential and appropriate to secure the freedom of that commerce from interference and interruption. The provisions of this title shall not apply to the master or members of the crew of any vessel not documented, registered, licensed, or enrolled under the laws of the United States. The United States Maritime Commission is hereby authorized and directed, upon request of the Mediation Board, to determine, after investigation, whether any person is an employee within the meaning of this subsection. "(c) The term 'Railway Labor Act' means the Railway Labor Act, approved May 20, 1926, as amended. "(d) The term 'Mediation Board' created by the Railway Labor Act. means the National Mediation Board "SEC. 1002. All provisions of title I of the Railway Labor Act with the exception of the provisions of section 2, paragraphs fourth, fifth, and ninth; section 3; and section 10 are extended to and shall cover every maritime employer and every employee of such maritime employer as they are defined in section 1102 hereof, in the same manner and to the same extent as though such maritime employers and their employees were specifically included within the definition of 'carrier' and 'employee' in section 1 thereof. "SEC. 1003. If any dispute shall arise among the employees of a maritime employer as to who are the representatives of such employees designated and authorized to act for them for the purposes of this title, it shall be the duty of the National Labor Relations Board, upon request of any party to the dispute, or the maritime employer, promptly to determine, in the same manner as provided in the National Labor Relations Act for the selection of representatives for the purposes of collective bargaining, and to certify to the parties and to the maritime employer in writing, the name or names of the individuals or organizations that have been designated and authorized to represent the employees involved in the dispute. Upon receipt of such certification the maritime employer shall treat with the representatives so certified as the representatives of such employees. "SEC. 1004. Disputes between a maritime employer or group of maritime employers and any of its or their employees growing out of grievances, or out of the interpretation or application of agreements concerning rates of pay, rules, or working conditions, shall be handled in compliance with the provisions of any agreement relating to the settlement of such disputes or in the usual manner up to and including the chief operating officer of the maritime employer designated to handle such disputes; but, failing to reach an adjustment in either manner, the disputes may be referred by petition of the parties or by either party to an appropriate adjustment board, as hereinafter provided, with a full statement of the facts and supporting data bearing upon the disputes. "It shall be the duty of every maritime employer and of its employees, acting through their representatives, to establish a board of adjustment with jurisdiction not exceeding the jurisdiction which may be lawfully exercised by system, group, or regional boards of adjustment, under the authority of section 3, title I, of the Railway Labor Act. "SEC. 1005. When, in the judgment of the Mediation Board, it shall be necessary to have a permanent national board of adjustment in order to provide for the prompt and orderly settlement of disputes between said maritime employers, or any of them, and its or their employees growing out of grievances, or out of the interpretation or application of agreements covering rates of pay, rules, or working conditions, the Mediation Board is hereby empowered and directed to establish a National Maritime Adjustment Board. Such Board shall be composed of such number of persons as the Mediation Board may determine, and its members shall be selected in the manner and by the procedure prescribed by section 3 of title I of the Railway Labor Act for the selection and designation of members of the National Railroad Adjustment Board. The National Maritime Adjustment Board shall meet within forty days after the date of the order of the Mediation Board directing the selection and designation of its members and shall organize and adopt rules for conducting its proceedings, in the manner prescribed in section 3 of title I of the Railway Labor Act. Vacancies in membership or office shall be filled; members shall be appointed in case of failure of the maritime employers or of labor organizations of the employees to select and designate representatives; members of the National Maritime Adjustment Board shall be compensated; hearings shall be held; findings and awards made, stated, served, and enforced; and the number and compensation of any necessary assistants shall be determined and the compensation of such employees shall be paid, all in the same manner and to the same extent as provided with reference to the National Railroad Adjustment Board by section 3 of title I of the Railway Labor Act. The powers and duties prescribed and established by the provisions of section 3 of title I of the said Act with reference to the National Railroad Adjustment Board and the several divisions thereof are hereby conferred upon and shall be exercised and performed in like manner and to the same extent by the National Maritime Adjustment Board with respect to maritime employers and their employees. From and after the organization of the National Maritime Adjustment Board, if any board of adjustment established by any maritime employer or maritime employers and any class or classes of its or their employees is not satisfactory to either party thereto, the said party, upon ninety days' notice to the other party, may elect to come under the jurisdiction of the National Maritime Adjustment Board. "SEC. 1006. If a dispute between a maritime employer or employers and its or their employees is not adjusted under the provisions of this title, and if in the judgment of the Mediation Board such failure to adjust the dispute shall threaten substanially to interrupt the flow of domestic and foreign water-borne commerce to the detriment of the public interest or to derprive any section of the country of an essential water-borne transportation service, the Mediation Board shall immediately notify the United States Maritime Commission of such failure to adjust the dispute. The Maritime Commission may thereupon, in its discretion, create a board to investigate and report respecting such dispute. Such board shall be composed of such number of persons as to the Maritime Commission may seem desirable: Provided, however, That no member appointed shall be pecuniarily or otherwise interested in any organization of employees or any maritime employer. The compensation of the members of any such board shall be fixed by the Maritime Commission. Such board shall be created separately in each instance and it shall investigate promptly the facts as to the dispute and make a report thereon to the Maritime Commission within thirty days from the date of its creation. "There is hereby authorized to be appropriated such sums as may be necessary for the expenses of such board, including the compensation and the necessary traveling expenses and expenses actually incurred for subsistence, of the members of the board. All expenditures of the board shall be allowed and paid by the Maritime Commission on the presentation of itemized vouchers therefor approved by the chairman of such board. "After the creation of such board and for thirty days after such board has made its report to the Maritime Commission, no change, except by agreement of the parties, shall be made by the parties to the controversy in the conditions out of which the dispute arose. "SEC. 1007. Except as provided in this title with respect to maritime employers and their employees, nothing herein shall be construed to repeal or amend any provision of the National Labor Relations Act or to restrict the powers and duties conferred upon the National Labor Relations Board by said Act. "SEC. 1008. If any provision of this title or application thereof to any person or circumstance is held invalid, the remainder of the title and the application of such provisions to other persons or circumstances shall not be affected thereby. "SEC. 1009. There is hereby authorized to be appropriated such sums as may be necessary for expenditure by the Mediation Board in carrying out the provisions of this title." The CHAIRMAN. This bill was written to carry out the recommendations of the Maritime Commission. After the experience of this Commission, it was found that certain changes seemed desirable, from the original act. So we are here to consider the proposed amendments. Mr. Kennedy, we welcome you. This is your first appearance before our committee in an official way, and we are very happy to have you and your colleagues here. Mr. KENNEDY. Thank you, sir. The CHAIRMAN. And we shall be pleased if you will proceed in your own way. I assume, of course, that you would like to go forward without interruption until you have made your original statement. Am I right? Mr. KENNEDY. I should like very much to do so, sir. STATEMENT OF JOSEPH P. KENNEDY, CHAIRMAN OF THE UNITED STATES MARITIME COMMISSION Mr. KENNEDY. Mr. Chairman and members of the committee, I am glad to appear here this morning to discuss with the committees the provisions of Senate bill 3078. But before going into the provisions of the proposed bill, some general observations on the subject of shipping legislation should be made. The shipping legislation of the United States would fill a library. The American colonies began to enact shipping laws almost as soon as they were established. The adoption of the Federal Constitution is said to have been inspired largely by the necessity for concerted action on the part of the separate States for the protection of their commerce. The first statute passed by the First Congress of the United States was the Tariff Act of July 4 1789, which contained discriminatory provisions in behalf of American vessels. From the adoption of the Federal Constitution in 1789 to 1830 no less than 50 legislative acts affecting ocean shipping were passed. We have been grinding out additional legislation ever since. It is only with extreme reluctance that I come before these committees with any suggestions for expanding the enormous volume of material already submitted to the Congress with regard to the American merchant marine. Legislation affecting the American merchant marine of today may be said to have begun with the Panama Canal Act of August 24, 1912, which admitted to American registry, for operation in foreign trade, vessels not over 5 years old. On August 18, 1914, this act was amended to admit foreign-built vessels regardless of age. The unfortunate conditions brought about by the World War, when many foreign vessels were withdrawn from our trade resulted in the Shipping Act of September 7, 1916. This act created the United States Shipping Board and gave it authority to form corporations for the acquisition and operation of merchant vessels with a capital stock not to exceed $50,000,000. The United States entered the war before the objectives of the 1916 act could be accomplished. Emergency legislation was enacted to extend the authority of the Shipping Board and its subsidiary, the Emergency Fleet Corporation, which was incorporated under the act and under whose supervision was constructed the wartime fleet of merchant vessels. On October 6, 1917, Congress passed an act admitting foreign vessels to our coastwise trade for the duration of the war and for 120 days thereafter. The first important shipping legislation after the war was that of June 5, 1920, which authorized the Shipping Board to establish and maintain domestic-flag services in the foreign trade of the United States. This act also created a revolving construction loan fund of 32437--37-pt. 1- -3 5,000,000 and contained certain provisions for the admission of ign-built vessels to the coastwise trade. he policy of the 1920 act was reaffirmed in the Merchant Marine of May 22, 1928, which increased the construction loan fund to 0,000,000 and established rates of payment for the carriage of ls, based on the size and speed of vessels and the length of their vard voyages. This pay was, of course, merely a disguised sub. It was designed in each instance to overcome the higher cost onstructing vessels in American yards and operating them under American flag. embers of these committees, and of the Congress, are familiar the unfortunate story of the 1928 act. A total of $176,000,000 paid out under the various mail contracts. In addition, conction loans were granted at rates of interest ranging down to eighth of 1 percent. It should be admitted that these expendis preserved the so-called mail-contract lines during an abnormal od when many of them would otherwise have been forced into kruptcy. It must also be admitted, however, that the act failed chieve its principal objective-the development of an orderly acement program for the war-built vessels constituting the bulk ur foreign-going fleet. ecognizing the weaknesses of the 1928 act, and the necessity for ew approach to the problem, Congress passed, on June 29, 1936, Merchant Marine Act of 1936. The act took effect on October 1936, 30 days after the appointment of the Maritime Commis. The Commission was set up on a temporary basis, with three bers, and so functioned until April 16, 1937, when the present mission took office. he act, therefore, has been in actual operation for less than 8 ths. It may be said that we have not had sufficient experience the act to determine whether or not it is workable in its sent form. This view is, as a matter of fact, held by one memof the Commission. The other Commissioners, however, feel that experience of the past 8 months indicates the necessity for ges in certain details if the objectives of the act are to be ined. suggesting modification of the 1936 act, the Commission does wish to be placed in the role of a petitioner. Nor can the Comsion promise to solve the shipping problem if the changes here gested are made. The Commission is merely indicating alteras which, in its opinion, would make the aims of the act more ly of attainment. Only experience can demonstrate whether not revised legislation will enable us to achieve the objectives ch the Congress had in mind. n an effort to determine the seriousness of the industry's ailments, to evolve a possible remedy, the Commission recently made an austive study of the shipping problem. The conclusions have referred to these committees and I assume will be part of the rd. The survey painted a rather bleak outlook for the future our vessels in foreign trade. It disclosed subsidized shipping as ery sick industry. The subsidized merchant marine consists, at the moment, of 155 sels, aggregating 1,011,000 gross tons. These vessels are spread r 17 lines. In addition, applications for subsidies may be filed |