ONE OF THE premises of those who support continuation and extension of our system of maritime subsidies is that the U.S. maritime fleet is in great distress. We hear over and over again that ship owners register their vessels under flags of convenience, like those of Liberia and Panama, and that the number of U.S. flag vessels is declining. Now comes a report from the General Accounting Office, a preliminary draft of which has been obtained by The Post, which suggests that the maritime industry is in much better shape than it would like us to think.
The GAO analysts do not dispute the figures which show, for example, that the number of U.S. flag vessels has declined from 523 in 1970 to 256 in 1980. But they also direct our attention to the critical question of what kind of vessels these are. The 1970s saw a vast increase in "containerization," the process that permits cargo to be loaded in one vast package rather than item by item. As a result, a given amount of cargo can be loaded and shipped more rapidly by containerized ships than by the kind of methods used in 1970. So it takes fewer vessels to transport the same amount of cargo. The GAO concludes that the shipping capacity of the U.S. merchant fleet has not therefore declined as the figures on the number of ships would suggest.
The GAO report undercuts the arguments made by shipping interests that their industry needs special federal help, notably the exemption from the antitrust laws that recently passed the Senate and seems about to pass the House. On the contrary, the report indicates that the U.S. flag merchant fleet is profitable, well-equipped and able to compete with carriers operating under other flags. The best argument the industry can extract from the report, in our view, is of the if-it-ain't-broke-don't-fix-it variety: with the current complex system of subsidies, the U.S. merchant fleet is doing fairly well, so the system, however offensive to free-market purists, should be left alone.
We take another view. American consumers should not have to pay the cost of subsidies that provide vast benefits to a few and that pass along heavy costs to the rest of us. Some plans the Reagan administration is considering to reduce subsidies are good; others, such as the antitrust exemption, that would increase costs to consumers, are not. It is still not clear whether the main purpose of the administration's plans is to reduce subsidies or just to shift the burden of subsidization from the federal budget to consumers' budgets. In the meantime, the GAO report serves the useful purpose of discrediting the lugubrious reports of the maritime industry's demise and directing the debate toward the twin questions of what, if anything, should be subsidized and by whom.