namely, to provide the Nation with a viable merchant marine capable of, among other things, responding to defense needs.

In assessing defense ocean shipping needs for peace and war, my conclusion is that the tanker situation, while not without its problems, is not critical to national defense. The changes in the general cargo fleet are giving us the greatest concern, and the balance of this summary is directed toward that area, as is much of the specific response to the questions you had asked.

I need to emphasize that we are concerned for the type and number of American vessels which could quickly be made available in a minor contingency situation, a situation where Allied support is absent and ship requisitioning is not possible. We are equally concerned that the total general cargo assets available to defense for a major deployment effort, including specific NATO shipping allocations in the case of a NATO effort, are only marginally adequate to meet our needs.

During the Korean and Vietnam situations, there were U.S.-flag tramp general cargo vessels available, as well as large National Defense Reserve Fleet (NDRF). Today the tramp ships are all but van ished. The NDRF is down to about 130 vessels that can satisfy sealift needs. Most of these were built in 1944 and 1945 and are approaching the limit of their usefulness. There is a real need to revitalize the essential NDRF.

In emergency situations short of mobilization, where merchant vessels would not be requisitioned, the Military Sealift Command has a contractual arrangement with most American berth shipping operators which gives Defense, in conjunction with the Secretary of Commerce, a capability to call up specific commercial vessels to meet the shipping requirements.

In major contingencies, there would be mobilization requisitioning of U.S.-flag vessels and, in the case of NATO involvement, provisions exist for the allies to provide some of their vessels to a pool upon which we could draw for military support.

A simple listing of resources, however, does not wholly define the problem. In many potential contingency situations, the military must plan on the use of unsophisticated ports, ports destroyed or sabotaged, or even possible over the beach cargo unloading.

These factors require the availability of some vessels with selfcontained cargo handling capability-we term these self-sustaining vessels. This capability would be most critical in the early days of an

emergency.

With the advent of the container revolution, the American merchant marine has moved toward highly efficient specialized vessels. In the general cargo trades, this movement is manifest in the ever larger number of non-self-sustaining container vessels. These vessels are not useful, in today's state of the art, without the accompanying availability of highly developed port facilities.

Then, too, there is a significant portion of military cargo, particularly in a deployment posture, that just would not-in a practical sense-containerize.

The Merchant Marine Act of 1970 did encourage the construction of vessels such as Lash and Seabee barge carriers and roll-on, roll-off types which are extremely valuable for Defense shipping, but the

demise of the totally flexible break-bulk, self-containing conventional general cargo vessel from the U.S.-flag fleet has placed constraints both as to numbers of vessels and how they can be used. Today, except for the Lash and Seabee barge carriers and roll-on, roll-off vessels in active commercial employment, all we have left in the nature of totally flexible and available vessels are the aged 130-odd vessels of the NDRF and 35 post-World War II Challenger or Mariner class conventional general cargo vessels.

The Merchant Marine Act of 1970 did provide some ships that are very valuable to Defense shipping needs. The current trend, however, appears to be toward big tankers, ore carriers and liquified natural gas carriers. These vessels are necessary, and may well be essential indeed, to the overall requirements of our country for the importation of vital commodities.

Unfortunately, these are not the type of vessels that are required to meet our military deployment and resupply shipping needs. To reiterate, it is the declining availability of versatile, do-any-job cargo vessels that gives us great concern, and this would be particularly critical in the early days of a contingency-minor or major,

It is not economically feasible for a commercial operator to build for his trade, the kind of ships we need. This, then, leaves us with several problems in achieving that additional capability essential to meet our requirements.

We are working on solutions to these problems.

First, the reserve fleet: There are plans to support the Maritime Administration in upgrading some of the vessels of the NDRF to provide their rapid availability. Of course, placing more modern vessels in the NDRF as they are replaced in active employment would greatly enhance this action.

Second, Research and Development: We have continuously worked at developing practical means of removing limitations presented by the ocean container and non-self-sustaining cargo ships. My office is actively coordinating with the Director, Defense Research and Engineering, in establishing a joint operational test that will bring together in fiscal year 1977 all the many equipment and concept developments now available into a complete logistics over-the-shore capabilities test and evaluation of sustained resupply operations.

I have directed any own staff to reassess the policies governing the size of peacetime active MSC general cargo fleet with a view toward the need for an assured and timely sealift response to a minor but urgent contingency.

Third, our sealift readiness program (SRP): Our current planning envisions new initiatives, in conjunction with MARAD, to enhance SRP responsiveness-particularly in the early stages of a contingency. These involve more early commitments, earlier replacement with NDRF ships and contractual changes.

These actions will not solve all the problems presented to us by the existing marginal sealift capability to satisfy our mobilization require

ments.

To do this, we will need the help and understanding of your committee, the American Merchant Marine Industry, Maritime Labor Unions and, certainly, the Department of Commerce and its Maritime Administration.

I am grateful to have had an opportunity to present the Defense views in this area that is most important to national defense. We are prepared to answer your questions to the best of our ability.

Mr. DOWNING. Thank you very much, Dr. Bennett.

Your formal statement will be printed in the record at this point. [The formal statement of Dr. Bennett follows:]

STATEMENT OF DR. JOHN J. BENNETT, ACTING ASSISTANT SECRETARY OF DEFENSE, INSTALLATIONS AND LOGISTICS

My name is Dr. John J. Bennett, Acting Assistant Secretary of Defense for Installations and Logistics, and I am pleased to appear before this distinguished committee to answer any questions you may have regarding this hearing. I am accompanied by Mr. Robert Carl, Special Assistant for Transportation to the Assistant Secretary of the Navy (Installations and Logistics), Rear Admiral Sam H. Moore, Commander, Military Sealift Command, and Mr. Lawrence A. Wheeler of the Navy Sea Systems Command-all of whom can elaborate on matters within their special field.

Before proceeding to answer your specific questions, I believe elaboration on a few background points would be helpful.

First, I cannot overemphasize that the Department of Defense (DoD) supports and needs a viable U.S. flag merchant marine in peace and war. History books are full of references to the direct role played by U.S. flag merchant vessels in support of American forces overseas in time of war. In a major war, Defense would be almost entirely reliant on civilian shipping assets. In peacetime, the need is no less great, where the vast preponderance of our Defense cargo moves in U.S.-flag vessels, much of it in berth line service, side-by-side with the freight of U.S. commerce. Indeed, a vital segment of the Defense Materiel Distribution System is in the hands of the U.S.-flag maritime industry-in peace and war. Because ocean transportation and merchant marine matters are of vital concern to DoD, there are internal organizational relationships structured to accommodate this concern. At the Secretary of Defense level, merchant marine, ocean transportation and shipbuilding are major logistical elements; as the Assistant Secretary of Defense for Installations and Logistics, I am charged with formulating and executing broad policy and management, with the close coordination of other assistant secretaries and equivalent officials.

At the next organization level-that of the Secretary of the Navy and his office, there are two elements that begin to diverge, as we drop down through the Chief of Naval Operations (CNO) and his staff, which is in many respects an extension of the Secretary's own office. The Secretary of the Navy is the Single Manager for all DoD sealift matters. Under this function, the Secretary of the Navy is charged with responsibility, within broad DoD policy, of assuring adequate and responsive sealift to meet the needs of all the Services and the joint and specified commanders. The Assistant Secretary of the Navy for Installations and Logistics, supported by the Special Assistant for Transportation, and through the Office of the CNO, oversee this function and coordinate sealift with all other Navy functions and missions. I might emphasize that the function of providing sealift is quite apart from the Navy function of protecting sea lanes for both military and civil use.

Answering to both the Secretary and the Chief of Naval Operations is the Military Sealift Command (MSC). MSC is a component of the Naval operating forces with worldwide command jurisdiction. In the MSC fleet of assigned or chartered vessels are general cargo, tankers, scientific project support and Navy combat fleet support vessels.

In addition to command of ships, the Commander of MSC is responsible for carrying out the Secretary's function of providing sealift for all DoD requirements. In the MSC staff are the professional maritime traffic managers and marine transportation specialists that daily work with industry, the Maritime Administration and the military service logisticians in satisfying the traffic of today and the movements that may be required in the future. It is these professionals who must keep abreast of the changing maritime scene and translate new capabilities into useful Defense mission support. The almost-revolutionary change in the U.S.-flag merchant marine over the past 15 years has made this a most challenging responsibility.

The other organizational channel, dealing with shipbuilding and shipyards, moves from the Secretary-CNO level through the Chief of Naval Materiel, to the Navy Sea Systems Command (NAVSEA). It is NAVSEA who must assure the necessary support to the Navy operating fleet for ship construction and repair. As in shipping we must look to the merchant fleet, so in shipbuilding we must look to commercial shipyards in the United States. To this end, we in Defense share a common objective with the Department of Commerce in the maintenance of a viable shipyard capability. This is the reason for joint Maritime AdministrationNavy studies of the national commercial shipyard capability now being conducted. The Navy Sea Systems Command is the Navy operating agent in this respect. Here, again, the forces of change over the past few years have been demanding and discordant, but there are highly qualified managers in NAVSEA who can meet the challenge.

Now, we can proceed to your questions. In terms of general comment, we had been asked by your Ranking Minority Member to give an appraisal of the current Soviet maritime positions.

As we see it, there has been an increase in the number of shipyards in countries dominated by the Russians. Additionally, the Russian flag merchant ships have been seen in great quantities in an increasing number of trade routes of the world. There are certain areas where the Russian merchant ships have had an economic impact by offering cut rates thereby tending to decrease U.S. participation in these articular areas. This poses the inherent danger of competition by the Russian merchant fleet in certain trade areas of the world and, of course, a concern of Defense, since it could lead to a reduction in the number of ships available to us. However, the specifics in relation to the number and extent and actions of the increasing Russian merchant fleet dominance should be addressed to the Federal Maritime Administration and the Federal Maritime Commission since these agencies have been involved with this problem directly.

I have been asked specfic questions by both Chairman Downing and Ranking Minority Member McCloskey regarding the subject matter of this hearing. While the questions are not duplicative, some do cover closely joined areas and a single answer for two questions will provide a much more complete picture. Therefore, as I proceed through the specific questions, some questions will be coupled together with a single answer.

Question. Whether there continues to be a national defense need for a United States-flag merchant marine?-Chairman Downing.

Question. What is the minimum number of U.S.-flag ships for national defense needs, given DoD's various contingency plans and assumptions?-Ranking Minority Member McCloskey.

Answer. The Joint Chiefs are responsible for war planning for both mobilization and non-mobilization situations, and in this context they direct a close examination of the capabilities and sizing of our mobility forces. The following sealift requirements are based on the needs to support JCS plans. The area of shipping critically lies in the general cargo category,an dmy answer here specifically addresses that segment. Certainly, there is need for tanker vessel support, but projections of capability and requirements indicate a relatively small support requirement and adequate resources.

I think that to place the mobility force requirements in perspective it is necessary to briefly address a range of potential conflicts, particularly the potential threat in Europe. A war in Europe beween NATO and the Warsaw Pact is the most demanding challenge which the U.S. faces. From a military standpoint, the defense of NATO is ranked next to the defense of the United States. One of our major concerns is that NATO be capable of sustaining a credible defense without having to rely on escalation to nuclear weapons for defense.

Our ability to achieve this conventional option is dependent upon our ability to rapidly deploy reinforcements to counter any Warsaw Pact aggression. The current political and military stability of the situation in Europe depends in large part upon the reinforcements that the U.S. can promptly get to the NATO theater our rapid deployment concept. Consider if you will the advantage of the Soviet Forces which would be deployed 1,000-1,500 miles over land in relative safety. By contrast, the U.S. must project reinforcements 3,000-5,000 miles by sea and air. Our ability to effectively achieve this rapid deployment depends on an assured responsive capability to overcome the distance limitations placed upon us. The deployment of forces to Europe and their logistics support will start immediately by both air and sea. Airlift can begin delivering of units and their equipment into the theater in a matter of hours. However, sealift, while taking

longer to begin deliveries, would be the means of delivery for almost 90 percent of the equipment and material to be deployed. The sealift assets which we plan to employ come almost entirely from the civil sector.

The number of government-owned ships operated by the Military Sealift Command (MSC) has declined in recent years, but those ships have never been enough to move more than a fraction of a major support requirement. It has always been our policy to depend heavily on the U.S. merchant marine to support major military contingencies. Within the next several years, most of the remaining government-owned ships will have to be retired because of age and material condition. Therefore, the U.S. Merchant Marine and National Defense Reserve Fleet (NDRF) are essentially the total U.S. resources available to the Department of Defense.

In the event of a NATO war, commitments have been made for early availability of ships belonging to our NATO allies to help support U.S. deployments. Thus, we are reliant on our allies to help meet wartime requirements as well. The NATO Contingency Sealift requirements in 1972 were jointly analyzed in the Sealift Procurement and National Security, or SPANS, Study. Participants were JCS, Office Secretary of Defense, Services, Maritime Administration, Federal Maritime Commission and Office of Management and Budget. At that time the study concluded that the entire U.S. Merchant Marine of 309 ships and 130 ships of the National Defense Reserve Fleet, augmented by committed NATO ships, were needed to satisfy U.S. deployment requirements. Since SPANS, there have been some major changes in U.S. military force structure and planning for NATO. Last year updated analyses were made of our airlift and sealift requirements to support war plans for a war in Europe. Given the movement requirements anticipated, the total number of ships available was considered to be only marginally adequate to meet the deployment and resupply objectives. Any diminution in the capability of the U.S. Merchant Marine would severely impact on our already marginal capability to support a conventional defense of Europe.

I would like to turn now to the non-mobilization contingency situation. We also plan for contingencies which could occur under conditions where we do not have the option of mobilizing or requisitioning ships from the U.S. Merchant Marine. The Navy has looked at a range of possible minor contingency situations to determine the magnitude of such shipping requirements. Planning for such contingencies could require resupply of an ally and deployment and resupply of U.S. forces. Typical forces in such a situation would be a Marine Amphibious Force and an Army division, along with Air Force Tactical Air Forces. Shipping requirements identified for such situations range from 52 to 145 ships. Again, the need is for early ship availability to meet rapid deployment requirements. The source of ships under these conditions would be the Military Sealift Command Controlled Fleet, of about 15, augmented with 37-130 ships from the U.S. Merchant Marine, nearly all of which would be obtained from ships committed under the Sealift Readiness Program. Under this program there are currently 115 ships committed by U.S. flag carriers to the Military Sealift Command for contingency use, which can be called up in increments. We have concern for implementing this program, however, since these ships would be removed from their normal trade routes and thus if kept for an extended time, the U.S. competitive position in the world shipping market could be damaged. Therefore, our concept for their employment would be that the National Defense Reserve Fleet would be activated as rapidly as possible to replace these ships which had been called into use under the Sealift Readiness Program, releasing them to return to their normal shipping routes.

In summary, the Department of Defense must rely almost entirely in the civil sector and, for a NATO situation, augmentation by allied shipping. The U.S. Merchant Marine provides about half of the ships needed for a NATO deploy ment and resupply, supplemented by the National Defense Reserve Fleet and allied shipping. Any reduction in the dry cargo ships of the U.S. Merchant Marine could severely impact on our marginal capability to support a NATO contingency or a less demanding contingency.

Question. Whether the vessels being constructed under the Merchant Marine Act of 1970 are suitable during a national emergency for the ocean transportation of (a) military supplies, (b) strategic commercial materials, and (c) the minimal nonstrategic materials required during a national emergency?-Chairman Downing.