man Bates introduced a companion bill in the House of Representatives on which hearings have already been held.

I am very grateful to you, sir, as chairman of this committee, for giving this consideration to S. 3229 for I think we are all agreed some legislative assistance is desperately needed by the fishing industry.

It would be superfluous this morning to discuss the depression in the New England fishing industry. I have spoken many times of the industry's condition, and so have you.

I ask at this point to have two of my previous statements inserted in the record.

Senator PAYNE. Without objection, they will be so inserted.

Senator SALTONSTALL. It has been clear for many years that the industry faces a very grave economic problem. And it is a problem of no small consequence to New England, for in New England alone over 60,000 people depend for their livelihood on the ground-fish industry. Twice in recent years President Eisenhower has been constrained for reasons of national security to reject two recommendations by the Tariff Commission for the relief of the New England groundfish industry. The industry has established economic justification before the Tariff Commission and demonstrated that it can not maintain competition against foreign imports without tariff relief or some other measure of assistance. But security considerations have precluded relief; and industry's condition continues to worsen.

I therefore ask only this question: Is it equitable to assume that one industry should bear the entire brunt of our national security policies with respect to friendly nations engaged in fisheries commerce? Should this industry be forced to suffer economically for national security considerations which affect us as a nation as a whole?

Some measure of assistance is clearly in order. On this I think all are in agreement.

The only question to date has been the way in which this assistance can be most effectively administered. We must develop the kinds of assistance that will most properly benefit the industry.

About a year ago, as I have already stated, Mr. Chairman, I began conferences with members of the industry and Government officials to determine what steps could be taken by the Federal Government to help the industry regain full economic health. We search for what the President in rejecting tariff relief called "root solutions" needed to meet the industry's dilemma.

Last fall we drafted therefore the original provisions of S. 3229. These provisions were the result of the combined efforts of government, industry, and Members of Congress. It was an attempt to cover comprehensively all of the industry's problems. But on reexamination during this session and after further study it became apparent that the bill could be simplified and still deal very effectively with the industry's most severe problems.

Accordingly, in recent weeks I have again conferred with industry and Government officials and we have prepared a substitute measure which yesterday I introduced on the Senate floor as an amendment in the nature of a substitute for the original provisions of S. 3229. I have conferred with my colleagues who cosponsored this measure and I believe it is acceptable to all of the original sponsors of the bill.

I regret very much having delayed the presentation of this amended bill for your consideration until yesterday, but many conferences were

necessary to insure that all interested parties concurred with the bill in its present form. Since we are all agreed on the objectives, it is most important that we select a course of action agreeable to all or as many as we can who are concerned.

I believe that this bill, copies of which you have, meets the present needs of the distressed segments of our fishing industry and has the support of everyone. At least I hope so. Two of the provisions of the bill were drafted by the Bureau of the Budget and the Department of the Interior.

The provisions calling for a ship-construction differential and a ship-modernization differential have been approved by the Department and the Bureau of the Budget in the past and presumably are acceptable now. Therefore, I think it is fair to say that all witnesses. are in support of this amended bill and certainly to this extent it constitutes an important improvement over the original provisions of S. 3229.

To summarize briefly the provisions of this new amended bill, it calls for four principal provisions.

First, it augments the current fisheries loan fund by an additional $10 million and gives authority to the Secretary of Interior to vary the terms of loans where he considers it to be in the public interest. The intent here is to permit the Secretary to offer 20-year loans at reduced rates to boatowners located in distressed areas of the industry. This amendment would also permit the Secretary to convert loans now outstanding under the present fisheries loan fund to these more liberal terms where the situation warrants.

This provision would of course by its increased authorization be of benefit to the entire domestic fishing industry, but of more immediate importance its liberalized provisions would greatly aid those segments of the industry located in distressed areas such as New England.

Secondly, the bill authorizes a $5 million loan fund for processing plants located in distressed areas. The terms of this section would permit 20-year loans at 3 percent interest.

Thirdly, the bill provides for subsidy differentials to be paid fishing vessels operators for the construction of new vessels.

And fourthly, the bill provides for differential payments to vessel operators for modernization and the installation of safety equipment. These latter two provisions are long overdue for the fishing industry. Their case is admitted by everyone to be on a parallel with the merchant marine. The Merchant Marine and Fisheries Act was passed in 1936, calling for vessel construction subsidies and modernization subsidies; its language included the fishing industry but due to limitations on the vessels to be constructed, the fishing industry has never qualified.

It is unjust that they do not qualify. For rationale that calls for maritime subsidies dictates with equal force the justification for fishing vessel subsidies.

A fishing vessel operator who wishes to replace an obsolete vessel or build a new one is required under existing regulations to build the vessel in this country. Yet, oftentimes it could be built 30 to 50 percent cheaper in a foreign yard, but the operator is precluded from taking advantage of this saving.

Yet, he must go out and fish sometimes just a few yards away from his foreign competitor whose vessel was built at this reduced cost. If there are tariffs to protect the domestic operator then he is unconcerned that the foreign boat was built at much less than the cost of his

own.

But in view of the present tariff situation the fisherman is compelled to compete in the open market with the foreign producers. Thus the requirement that he build his boat in this country makes it virtually impossible for him to compete on fair terms with his foreign counterparts.

If we cannot raise tariffs-and it is clear under present international conditions that we cannot-then we must permit fishermen who are in direct day-to-day competition with fishing fleets of foreign nations to overcome this inequity, just as the Maritime Act contemplated and just as the Maritime Act now permits with our merchant marine. There is no distinction in the justification of the two and it is time that Congress remedied the patent injustice.

These provisions will do much to improve the efficiency of our domestic fishing industry; it will permit more equal competition and it will do much to stimulate new activity in the fishing industry and new activity in the shipbuilding industry.

The Department of the Interior and the Bureau of the Budget have in the past strongly supported these provisions. All industry representatives with whom I have conferred strongly support these provisions.

This bill would

Make available financing for the rehabilitation of the industry's physical plant, both the shore plant and vessels. The financing would be on terms that would not impose an additional heavy burden on the industry.

Encourage improved facilities, thus permitting more efficient operation within the industry and thus enabling it to compete with lowcost foreign imports.

Result in modernization of the industry's physical establishment leading to better quality-end products which has been among the principal objects of all recent fisheries legislation.

Encourage installation of safety equipment and the modernization of vessels plus the introduction of new vessels, thus reducing accidents at sea, which now take a heavy toll, and reducing the extraordinary insurance premiums now charged to the industry. This could result in substantial savings to the industry and thus better enable it to compete with foreign imports.

I will leave to expert witnesses who follow the task of outlining the industry's difficulty, the extent of foreign competition, and the manner in which foreign competition is injuring the industry. It is only equitable that the Congress act to offset thhe adverse effects of our foreign-trade policies in the case of the fishing industry. Important national security gains have been made by the United States by maintaining existing tariffs on imported fish, and the American taxpayer has not had to bear this cost. The New England groundfish industry has.

For the modest outlay of this bill the American taxpayer is assured availability both in peace and in war of this vital food supply. The

fishing industry makes a very important contribution to our national food resources.

After a year of preparation, this legislation is now in a form, I trust, acceptable to all parties concerned. I am of course greatly pleased that we have arrived at a bill which will aid the industry and which can be supported with unanimity.

I urge therefore you, Mr. Chairman, to expeditiously consider and refer to the Senate this bill for assistance to the domestic fishing industry. The time has come to aid this industry. Equity and the national interest call for prompt and decisive action.

I conclude, I know of your great knowledge and interest in this subject. I can't add to that knowledge here.

I have stated in this statement that the Secretary of the Interior has supported us on the provisions in this bill. I believe that he personally is behind all the provisions which I have noted.

The Bureau of the Budget went along previously on most of these provisions. It has not, it is my understanding, been willing yet to approve these construction differentials and modernization differentials. The Secretary of the Interior has when I conferred with him several weeks ago. I understand that he has but that he cannot support these provisions on the record, so to speak, until he has the approval of the Bureau of the Budget.

I am informed by my assistant that while the Bureau of the Budget earlier approved these provisions, it has not now done so, and that is one of the reasons that the bill has been so long in coming before

you.

If the Bureau of the Budget hesitates because this construction subsidy comes in at this time, as to the extent that it may develop in other portions of the fishing fleet, may I say that all through this bill there are words that this is specifically confined to areas of the fishing industry which can be approved to be economically in difficult condition because of the tariff conditions and the necessity of modernization of their fleet.

I hope that before your hearings are completed, and I hope they will be completed quickly so that you can get action, I hope you can get confirmation of the Bureau of the Budget or at least the position of the Bureau of the Budget stated.

I want to say in all fairness that while the Secretary of the Interior, I believe, is 100 percent behind these provisions, his hands are tied, or his representatives' hands, because as you know under the law the Bureau of the Budget has to give its support to his recommendation. I thank you very much, Mr. Chairman. I know you have distinguished witnesses here who are very well informed on this subject. If they are better informed than the chairman himself, then they are very wise men.

Thank you.

Senator PAYNE. Senator Saltonstall, I don't know where you get that, but certainly it must come from off the coast somewhere. Senator SALTONSTALL. Thank you, sir.

Senator PAYNE. Thank you very much for the presentation that you have made. I want to assure you that I am wholeheartedly in support of the proposal that is under consideration here. I will try not to let my service here in behalf of Senator Magnuson sway my views on it, but I am very much in support of it. I can tell you that. I did

place in the record here on Tuesday information relative to what others are doing, to be of assistance to their fishing industry, which certainly far surpasses that which we in this country have up to this moment done for our own people.

I think we are making progress. It is slow, but let's hope it is sure and certain, to help an industry that needs help.

Senator SALTONSTALL. I know your heart and your mind are in the right place.

Senator PAYNE. Thank you very much.

Senator SALTON STALL. Thank you, Senator.

Senator PAYNE. Senator Magnuson and I did introduce legislation that has already passed the Senate which increased the authorization for the fisheries loan fund from $10 million to $20 million. That was passed on May 29. The legislative day is May 28. It passed the Senate and it is now in the House of Representatives. So that, if passed by the House, and if the bill that we presently have under consideration is passed, it would mean then that we have a total of $30 million authorization available for this.

As far as I am personally concerned, I want to say that I would be strongly in favor of it.

Our next witness is Thomas D. Rice, executive secretary of the Massachusetts Fisheries Association. Tom has been here regularly at these hearings, not only at these hearings but at every hearing that has to do with the problems of the fishing industry. He is an old friend. I am happy to have him here this morning.

STATEMENT OF THOMAS D. RICE, EXECUTIVE SECRETARY, MASSACHUSETTS FISHERIES ASSOCIATION

Mr. RICE. Thank you, Senator.

My name is Thomas D. Rice, executive secretary, Massachusetts Fisheries Association.

In the interests of brevity, Mr. Chairman, I would just as soon submit my statement for the record, rather than read it, because everything that is contained in there you, coming from the State of Maine, are just as much familiar with as I am, and it would be more or less repetitious.

Senator PAYNE. If you want to do that, Tom, without objection the statement in its entirety will be made a part of the record, and then if you want to proceed extemporaneously to touch upon any phase of it, just feel free to do it.

(The statement is as follows:)

STATEMENT SUBMITTED BY THOMAS D. RICE, SECRETARY, NEW ENGLAND COMMITTEE FOR AID TO THE GROUNDFISH INDUSTRY, EXECUTIVE SECRETARY, MASSACHUSETTS FISHERIES ASSOCIATION, INC., IN RE S. 3229

Mr. Chairman, members of the committee, I am Thomas D. Rice, secretary for the New England Committee for Aid to the Groundfish Industry; secretary of the Federated Fishing Boats of New England and New York, Inc., and executive secretary of the Massachusetts Fisheries Association, Inc. The three organizations represent about 90 percent of all the concerns presently engaged in the commercial fisheries industry of New England.

The fisheries legislation submitted for your consideration is the end result of many months of research, study, and conferences between industry members, Members of Congress, the Department of the Interior, the Bureau of Commercial Fisheries, congressional legislative assistants, and legislative counsels. It