The CASL group? Mr. May was here earlier. Is Mr. May still here? I believe no representative of CASL is here. So we do not have any remark there.

The PASSA group, Mr. Thurman.

STATEMENT OF JOHN N. THURMAN, WASHINGTON COUNSEL AND VICE PRESIDENT, PACIFIC AMERICAN STEAMSHIP ASSOCIATION

Mr. THURMAN. For the record, my name is John Thurman. I am Washington counsel and vice president of the Pacific American Steamship Association. It will be very easy to hold my remarks to 5 minutes. I only want to discuss one little facet that developed today which came as a complete surprise to me and that was the mention that tankers cannot go into Nakhodka. Captain Goodman read a telegram that Continental Grain had received on the 21st of January, I believe. This I am afraid will destroy your whole program for moving grain from the west coast to Nakhodka in that you have a 31- or 32-foot draft limitation at the most.

Supertankers are cut out, and super bulk vessels are cut out. Now if we can't tanker in we either have to put the Niagara on the shuttle run or we won't have any U.S.-flag participation. Perhaps the west coast facet of this program will have to be looked into again.

I would like to say that our organization would like to work with you any way we can. At the break this afternoon I sent a teletype to the coast and asked our people to kindly check through out contacts in the Far East as to what could be done to carry ou Mr. Dowd's suggestion for an educational program that would be helpful to the Russians, learning the procedures of using evacators and tankers. I do not represent any tankers but if we don't use any tankers in this lift I don't know who else can carry it.

The only thing I would like to say further in this regard is, as I mentioned this came to me as a surprise, and I am under the impression that Maritime did not know about this very long either.

Sometime back in our earlier discussions, the draft issue came up rather suddenly too. It is almost as though Continental Grain is pulling rabbits out of a hat. I would like to request Maritime to keep a good eye on the magicians and ask them to put all their cards on the table so that we will know whom we are dealing with on this

matter.

Also I would like to make a further comment unsolicited. I know how terribly hard your staff has worked on this very, very difficult situation. Captain Goodman and all these people are good friends of mine. So what I have said about them cannot be taken as anything other than friendship. They have worked very hard on a very difficult

situation.

I think you have been given an almost impossible task. I don't believe the Government has been asked to do anything like this before. Many of the criticisms by our organization that we have made to the administration have been in our view misguided.

We wanted to make that point with you the other day when we were unable to be with you. We would like to do everything we can to help you get the program moving forward.

Mr. GILES. Thank you very much, Mr. Thurman.
Does Continental have any comment at this point?
Mr. STOVALL. No; I left my magic cards at home.

Mr. GILES. Thank you very much, Mr. Thurman. We appreciate your being here with us.

Now is there anyone else?

STATEMENT OF TAL SIMPKINS, AFL-CIO MARITIME COMMITTEE

Mr. SIMPKINS. Tal Simpkins, AFL-CIO Maritime Committee. I have a similar comment.

Mr. GILES. Yes, sir, have a seat, please.

Mr. SIMPKINS. I will be very short. We too are one of the unhappy groups that the foreign-flag ships are carrying this grain. I can simply state that our opinion coincides with the previous union witness. We think the real problem here is going to come in particularly with foreign-flag ships, the runaways carrying this grain which will be on board in New York. We have to take what action they do.

Mr. GILES. I would simply like to say that there again, as I expressed to Mr. Gleason, I think it is in the interest of the maritime labor, regardless of its personal feelings or past position-I think it is fundamentally in the interest of maritime labor to not frustrate the basic Government policies that the President has established, whether it is good or bad. I do not think anyone should be made to work if he doesn't want to. I do think it is not right, and it is not in the selfish interest of the maritime industry, or the maritime labor to take action to prevent anyone working where the objective is really to frustrate or to oppose basic policy, basic foreign policy of international trade. I am simply expressing my own personal view.

I can understand the various feelings on that. I think Mr. Hall is perfectly right in one of the remarks he made, we have got a situation with sort of scrambling over the bones, or something to that effectscrambling over dollars, fighting about dollars. That is true, but it seems to me that maritime labor and industry is in this position. It has an extra burden of responsibility which calls for an extra burden of restraint perhaps. That is in order to see through the woods to the trees to a better public policy or better Government policy, whether in terms of financial support or otherwise.

I believe it would be in the interest of maritime labor to see that we have less of these disputes. I understand in the future, because I am always hearing questions raised about that, and "Why should we get into this, or that?" "Why should we build another ship?" "Why should we have another big experimental ship?" "Why should we get into that program or this one?"

I've heard that with respect to this 50-percent requirement, "Why should we get into it?"

I think it is because of the difficulties, and you would get right down to it, and the administering, the handling of it in such a way, and communicating with all concerned so that they will know what is going on and so we will not have dissension and outright strife. It is a matter of restraint and using judgment and imagination, which applies to Government officials and to owners as well as labor. Some labor unions are not set out apart on that. I do think, again emphasizing

my opinion here, it is in the interest, the selfish interests of the maritime industry for maritime labor not to seem to be in the position of usurping the policies and the authority of the President of the United States and the Congress as to what is going to be our laws and our foreign trade policy.

That is my personal view.

Mr. SIMPKINS. We had hoped that the ground rules that we were stated would say "50 percent" and that would be "period." If the sale would hinge on this, perhaps the sale wouldn't come off, the ground rules being 50-percent American-flag ships. If that would have been the ground rules "period" perhaps the problem wouldn't have arisen.

Mr. GILES. Mr. Simpkins, I do not see how we can say it is possibly as simple as that. We don't say it is simply the "ground rules." We have got a lot of detail, not nearly as much as back over the years, that the Government, in effect, has made decisions on it because of the nature of that program.

There was a degree of competition among American ships themselves that we had disputes more or less on these details. It should be unnecessary. This is not merely a matter where you say that you've got to have 50 percent and that is it. Once you make that basic decision, you find the Government having to go steps further, and the shipowners, and the charterers demand it. They couldn't get questions resolved. We have been into it for the several weeks, because I took the position, the attitude that I should not just sit here and refuse to express views on these details. I should not sit here and wait until the waiver application got in. At that point I would inform the shipowners and the charterers, what these terms and conditions would be for purposes of passing on a waiver. That is really the only official basis that I have. One thing has led to another.

Any further comments?

Mr. SIMPKINS. That is our opinion.

Mr. GILES. Thank you very much for being here.

Anyone else have any comments? Any other labor officials that I have not recognized have a comment ?

Mr. Shepard?

Any owner?

Mr. KAHN. One question, Mr. Chairman. I appreciate that at this stage of the game it is impossible, or close to impossible, to make any change of what we have been talking about, ground rules for Continental. They have made a business deal with certain ground rules as a basis for the business deal. The inquiry that I have, and I don't know if I made it clear when I sat in that chair, is how and which way are the ground rules going to be changed for the future programs which are about to take place, particularly in connection with Cargill and other grain houses?

Mr. GILES. Mr. Kahn, that is a future sale. Is there a definite sale there? I gather from the papers there is a definite sale by Cargill. They have a definite contract for a sale, is that right?

Mr. KAHN. This is my understanding, sir, and the thing that I am worried about is you must understand that it is possible for Cargill to go to Moscow and conclude a sale with the 29-foot draft, and come back and document it to you and say, "Yes, it is. This is it." Car

gill must have its ground rules now in order that the American-flag participation will be possible when the grain starts moving.

Mr. GILES. As far as programs, I would regard whatever sales are made within these next few weeks, of the first half of this year, as a program. As far as I can tell, the Government is not in a position, and presumably will not be, to make any basic change in the announced policies. Therefore, I would assume that any further contracts would be along the same lines, and substantially in the same basis as the Continental, as far as our efforts.

On terms and conditions, we will, assuming Continental has that sale, Cargill has that contract, we will have them in promptly next week, if not tomorrow, and go over what they have. We will start, of course, with the terms and conditions that have been published already, unless there is a good, valid reason to make some change, either favorably to the shipowner, or unfavorably, and then we'll have to stay with that. I see no choice on that. I will say to Cargill, as I said to Continental, I will not, in administering my portion of this responsibility, accept the premise that whatever is in your contract of sale will govern. I have not accepted that premise. That doesn't mean that we will not consider it as well, but where the Soviets have had certain shipping restrictions then, in addition to making known, that there is some obvious, valid argument for it, then we are not in a position to tell the exporter that he must do something else, because, obviously he cannot, under his contracts, unless he has a real good reason. If we took the position that we were doing this as a government, as I view it, we would be in a position of making the major issue the Soviet Government, and saying this is so important to us that it stands or falls on this.

Now, that doesn't mean we should not take that position in the proper case. I haven't seen anything in Continental that was of that nature. If any exporter comes in with a draft limitation of 29 feet, which you mentioned as an example, I would not imagine that I could have any trouble with it at all in saying that is not a reasonable limitation.

We have a lot of 10,000 tonners, a lot of Liberty ships at the top rate that come well within that limitation. That would be my attitude. I have so previously indicated to Continental in connection with this draft matter. My attitude has been, and it will continue to be with other exporters, as it has been with Continental, we want to see your contract and what it says about shipping. We will be reasonable, but as to the points in controversy we will have to make a judgment. That is the best we can do.

STATEMENT OF EARL SHEPARD-Resumed

Mr. SHEPARD. I would like to make an observation. Like my colleagues, I have been sitting here all afternoon. I have heard a lot of things about changing the ground rules and procedures. Unless I misunderstood you, you just said that the Government doesn't intend to change its policies. This means we are still faced with the same ground rules for Cargill or Continental, or anybody else. It also means that we would be faced with the same situation with the next million tons as we have been faced with this million. Nothing has been

altered. It means this: that if we hadn't applied, and let's face it, we wouldn't have gotten this other tonnage unless somebody had started hollering, it would still have been 213,000 tons versus 232,000, whatever the tonnage.

We would still be faced with the same situation when Cargill gets their tonnage. Are you telling us that we are going to be faced with carrying 40 percent of this grain, or 25 percent of this grain, is that what you are telling us?

Mr. GILES. I did not say that, Mr. Shepard. I did not say that the Government would not change these ground rules. Let's refer to them as charter conditions. I said I see no basis for changing these conditions which we have published unless there is some good reason brought forward.

Keep in mind these conditions that we worked out, and have had to publish here, they are in general the same conditions that we have worked out over a period of years in the Public Law 480 shipments, except they have very definite improvements for shipowners, for example, demurrage 2,500 versus 1,500 rate of discharge 2,000 tons a day versus 1,000. This latter point is very important. If the shipowner doesn't have that 2,000 tons discharge he gets demurrage right there.

There are other points in our terms and conditions that we have published here on this Continental matter. They have been the same or better in several particulars. Do you recall any informationMr. GOODMAN. No.

Mr. GILES. Better than on the Public Law 480.

Now, when it comes to the question of a draft limitation, all I can say, as I said to Continental, you've got to make your case. There cannot be a general limitation on draft. You cannot just say we are not going to consider anything over 31 feet. You are going to have to make your case. Then, if it comes around to a waiver application, we will at that point look at that documented case. If there are other shipments, let me say this, and this is an important point, I was asked some months ago, before Christmas, "What about the matter of shipments, of shipping dates?"

Our answer to that has been that the question of shipping dates, loading, delivery, and so forth is a matter for the buyer and the seller. You must keep in mind that American-flag shipping will have to have, and will have, the same shipping schedules offered them as is offered to foreign flags.

I don't know whether I have seen it in the paper if there are other sales or shipments in February, in March, or whatever, or April, then obviously with the American merchant marine busy as it is now, it is not going to be able to carry anything. It is not going to be able to get a reasonable portion of that.

Well, that may be, but I don't see how our general rules, or general statement there could be any different than to say that the question of loading and delivery will have to be between the buyer and the seller. It ordinarily is. We cannot, as a Government policy, say to somebody else that you are going to have to buy and have delivered at definite times.

I would also assume that a buyer and seller would have the good business judgment in their own self-interest not to make a contract