Brushing aside a last-minute appeal by Great Britain, Norway and eight other maritime nations. President Carter has agreed to back legislation that would guarantee U.S. flag tankers nearly 10 per cent of the nation's oil import market.
While House sources said Carter made up his mind on the controversial "cargo preference" issue this week after months of uncertainty. The American maritime industry had been pressing for a bigger share of the market - as much as 30 per cent of the nation's oil imports by 1980 - but was widely expected to be satisfied with this much of a foot in the door.
Opponents quickly assailed the protectionist decision and charged that even the President's scaled-down plan would cost the American public $7.25 billion over the next five years.
The chief congressional sponsor of the "cargo preference" legislation, House Merchant Marine Committee Chairman John M. Murphy (D-N. Y.), was, by contrast, delighted. He went so far as to call the White House decision "the most significant event in the history of the American merchant marine since the founding of the republic."
According to Maritime Administration officials, the nation is importing more than 8 million barrels of oil a day, but only about 3 per cent of it is carried here in privately owned U.S. flag tankers.
The administration proposal, Murphy said, would require that more of the imported oil be shipped here in American bottoms manned by American crews, beginning with 4 1/2 per cent upon passage of the legislation and rising 1 per cent a year for the following five years.
Responding to rumors that a decision was imminent, representatives of 11 maritime nations, which are already laboring under a worldwide surplus of oil tankers without cargoes to carry, submitted a short aide-memoire to the State Department on Tuesday, declaring that they would be opposed to even a compromise plan. They contended it would be inconsistent with the President's strong talk against protectionism at the recent summit meeting in London.
The 11 nations - Great Britain, Norway, Japan, Belgium, Holland, Greece, Italy, Sweden, Denmark, the Netherlands and Finland - concluded the note by saying that they hoped "the United States will bear in mind the common interest of her maritime trading partners."
According to informed sources, Assistant Secretary of State for Economic and Business Affairs Julius L. Katz met with representatives of the 11 nations yesterday to tell them their views "were made known to the President" but to explain that Carter's decision was based on "domestic employment reasons."
"There's a lot at stake here," said one knowledgeable official. "You're talking about possible violations of treaties [of friendship, commerce and navigation] and perhaps retaliation by other countries."
Despite a search for other alternatives for the already heavily subsidized U.S. maritime industry, the President was reportedly persuaded by his advisers, especially Robert S. Strauss, his special representative for trade negotiations, to support oil cargo preference. Carter's campaign promises to the maritime unions, included "a fair share of all types of cargo" for the American flag fleet.
"You might get some gripes [from other nations] but I doubt anybody's going to declare war over it," said one Strauss aide.
Federation Chairman Philip J. Loree said U.S. tanker rates have increased 50 per cent over the past year thanks to the Alaskan oil trade and other demands for American bottoms. He estimated the Carter plan would cost the public $7.25 billion by 1982.
Jerry J. Jasinowskt, assistant secretary of commerce for policy, denounced that estimate as "ridiculous . . . just ridiculous" and insisted that the program "would not cost over $1 billion." Commerce Department officials have estimated the cost to consumers, once the plan in effect, at $110 million a year.