SHIPPING: Stormy Weather

Like busy tugs about a liner, two congressional committees last week were nosing about a leviathan among federal agencies, the Federal Maritime Board. In the last 15 years, the Maritime Board and its predecessor, the Maritime Commission, have spent $14.5 billion on the U.S. Merchant Marine. The spending has gone almost unnoticed by the public because, in the words of one shipper, "there are a lot more people in the U.S. interested in potatoes than in ships." How much waste or skulduggery was there in the spending? Last week:

¶ One congressional committee was probing the millions in profits made overnight in the sale of surplus tankers used to carry oil to China (see NATIONAL AFFAIRS).

¶ The Justice Department was checking into the sale of 47 surplus ships sold at bargain prices, to see if it could force their return to the Government.

¶ Senator Lyndon Johnson's watchdog committee was looking into reports that shippers who had chartered ships from the Maritime Board were making as much as $1,000 a day a ship, hauling supplies to Korea and cargoes to Europe for the Mutual Security Agency.

The Missing Billions. The stormy weather in which the, Maritime Board found itself was not the fault of its present boss, Vice Admiral (ret.) Edward Lull Cochrane. Boss of the Navy's Bureau of Ships during World War II and a crack naval architect, Cochrane became head of the Federal Maritime Board in 1950, when it was set up within the Commerce Department to replace the old Maritime Commission. He has been trying diligently to unscramble its problems ever since.

The biggest problem was the mess of wartime claims. During World War II, the Maritime Commission spent $13 billion and supervised the building of 5,300 ships. But after the war the commission couldn't even account for $2 billion it had spent. Said Comptroller General Lindsay Warren: "There was never a charge on our part that there was fraud or that anybody stole the money . . . That could have been but . . . we could not substantiate it."

When Cochrane took over, he cleared out top deadwood, cut the staff from 4,853 to 4,211, whittled the backlog of claims. Cochrane is proud that the board and its predecessor sold 1,956 ships worth $4.4 billion for $1.7 billion, chartered ships for another ½ billion. He insists that it was a better return than any other agency got on war-surplus property.

Launch & Drydock. But he also found that despite the billions spent on the U.S. Merchant Marine, the fleet was a bad second in size to Britain's, and in poor shape. Cochrane wangled $350 million to build 35 Mariner cargo ships, the first new class of cargo ships built by the board since the war. The new class is bigger (12,500 deadweight tons) and faster (20 knots) than World War II's Victory ships. As the first Mariner slid down the ways last month, it was plain that the $350 million would be only a down payment to modernize the U.S. Merchant Marine. Cochrane was thinking about asking for another $150 million for 15 more Mariners. Yet last week, as the new ships were abuilding, the Maritime Board announced that it is laying up 120 of its ships now in ocean service. There is not enough business to keep them busy. This paradoxical situation is a prime example of the hit-or-miss, short-range U.S. Maritime policy.