Senator BARTLETT. Notwithstanding the fact that your presence there would otherwise be taken for granted, you thought it important enough to leave for several days to come here? Mr. OSHIRO. Yes, Mr. Chairman. Senator BARTLETT. Now, you mentioned subsidies. That is a word not unheard of in these Halls. There are subsidies of one kind or another, I guess. But the word is not too popular in all quarters yet; certainly not, I suspect, with you or with me. We prefer some other means of making suitable arrangements, if they are to be found. Do you have any alternate ideas as to how this problem could be resolved? Mr. OSHIRO. Mr. Chairman, I arrived earlier in Washington than I expected, because I had short notice and I was not familiar with the problems. But, like many other things, the more you look into the problems, the more you find that the solutions create problems also. Frankly, I do not have the experience, nor the knowledge, nor the background to contemplate any specific suggestions. The only suggestion that we thought of back in Honolulu, at the time the resolution was drafted, was on the basis of what meager information we had. We felt that if the carriers in the foreign commerce could be subsidized that we saw no reason why the domestic carriers could not also be subsidized. But as far as the other solutions are concerned, we would rather leave it up to the wisdom of the committee. Senator BARTLETT. We assuredly would not ask you to appear here before the committee as an expert on maritime transportation. Do you have the feeling that these repeated freight rate increases are bearing down hard upon the individual citizen of Hawaii? Mr. OSHIRO. Yes, Mr. Chairman, for this reason: The figures quoted by Senator Long, as well as the attorney general, are correct. But those figures, I believe, take into consideration the years from 1950 to 1959. Just for curiosity, before I left Hawaii, I had a reference bureau check into the rates since 1946 and the astounding thing is what we could have shipped in 1946 for a hundred dollars would cost today, in terms of freight alone, $275. That means that we have less money to buy other consumer goods or to buy other products from the west coast or any other place; and that is the reason why I would like to emphasize the factor of national economy, because Hawaii is a good market for a lot of the west coast industries. But if the tariffs keep on rising, it is going to get to a point where we may have to turn to other sources for our products, like the attorney general indicated. We buy a lot of lumber from Canada, whereas we used to buy it from Washington State and Oregon and California. Senator BARTLETT. Of course, these figures you produced, to which you just referred, are startling that it costs $275 now to ship an item which could have been shipped for $100 in 1946. But I don't suppose anyone would contend that this represents an average of the inflationary process to which this country has been subjected since then. It is extraordinary, is it not? Mr. OSHIRO. Yes, Mr. Chairman. Senator BARTLETT. Mr. Grinstein? Mr. BOURBON. I have none. Mr. GODING. I have none. Senator BARTLETT. I want to thank you very much. And I would deem it a personal favor, Mr. Oshiro, if you would thank your colleagues in the house of representatives for having made it possible for you to come here to testify before the committee, because you have given us some data that otherwise would not have been available. But, more importantly, you have contributed by informing us of the concern of the people of Hawaii in respect to this problem. I personally am deeply appreciative. Mr. OSHIRO. Thank you, Mr. Chairman. Senator BARTLETT. Mr. Goding just informs me that the next scheduled witness, Governor Merwin of the Virgin Islands, will not appear before the committee. Incidentally, it might be mentioned that the Virgin Islands do not fall within the provisions of the cabotage laws which apply to these other areas. Let's go into recess for 10 minutes. (A short recess was taken.) Senator BARTLETT. The subcommittee will be in order. It is our pleasure now to hear from the former Associate Solicitor of the Department of the Interior and the present secretary of Guam, Mr. A. M. Edwards. STATEMENT OF A. M. EDWARDS, SECRETARY OF GUAM Mr. EDWARDS. Thank you, Mr. Chairman. I wish to take this opportunity on behalf of the people of Guam to say how deeply appreciative we are of this opportunity to appear before you and express our views on this matter, which is of vital importance to the island of Guam. Governor Flores asked I express his regrets he was unable to be present and he asked that I appear and present his views. As you know, Guam is the most distant of the U.S. territories from the mainland, being some 3,200 miles west of Hawaii. In fact, Guam is the gateway to the United States from the Far East, being approximately 1,500 miles east of the Philippines. It is the largest and the greatest populated of the Marianas Islands, having a land area of 221 square miles, with a population of about 70,000 persons, of which about 30,000 are natives of Guam and the rest composing the personnel of the Armed Forces, their departments and civilian personnel connected with the various activities of the military and other Federal and territorial activities. Our present economy is based on furnishing services to the Armed Forces. We have very little industry, although effort is being made at the present time to revitalize the use of coconuts, which before World War II was one of the main sources of income for the territory. While we are attempting to do this, we have discovered that a large number of our coconut trees are diseased and we are having a survey made now by a doctor who was formerly of the University of the Philippines to determine whether or not we can utilize our coconuts. Senator BARTLETT. If he can't do it, remember the Bartlett tree surgeons. Mr. EDWARDS. I certainly will. We understand and we have had information that there is a new machine that will produce not only coconut oil but also coconut flour, and utilize the fiber of the coconuts and, if this would develop, if this machine is practical, and can be economically operated, feasible for operation on Guam, it would give us some industry. There is little agricultural activity, although efforts are being made to increase the production of food. We are working now in developing some poultry, but as to agriculture we are still confined more or less to truck gardening, and we do not begin to serve anywheres close to 10 percent. It is confined to mostly the use of bananas; we have a few pineapples, which are used for the local market; but nothing is exported and in fact we have to import all of our fresh fruits and vegetables. As I have said, we import over 90 percent of all of our food products, and 100 percent of all other consumer items needed for the civilian economy. Therefore, transportation is a vital connecting link to our lifeline. In other words, Guam cannot survive without sea transportation. Guam, too, has been and is being affected by general rate increases. We have had two recent rate increases, with the second coming prior to the final determination of the first. And these cases are still pending before the Maritime Board. We are also in a similar position as is Hawaii, since coast wise laws which protect American maritime industry in the shipment of goods between the coastal cities on the mainland likewise apply to Guam. And at this point we recognize that since coastwise laws applied to Guam, the shipper of merchandise in an American-flag vessel from the States say it is shipped to Japan, that carrier gets a subsidy, whereas if it is shipped to Guam, which lies practically due south of Tokyo, being the same distance from the same city, the carrier gets no subsidy. And thus the people of Guam have to pay full rate, plus reasonable rate of return on their investment, in having all of our commodities transported and all the cargo transported to Guam. In addition, we have, because of our location, and because of the nearness to the Far East, we are a vital link in our national defense and by reason thereof Guam does not enjoy the same privileges as the coastal cities on the mainland or in other areas under the United States flag, with regard to competition from foreign vessels. By Executive Order No. 86-83, dated February 14, 1941, Guam was declared and reserved as a naval defense sea area and all foreign vessels are prohibited, unless their entry is authorized by the Secretary of the Navy. Since this is a matter of our national defense, naturally we in Guam are not in a position to comment thereon. We only wish to call this matter to your attention so that the committee might be cognizant of this matter. I should like to file with the committee an exhibit which shows the commercial inbound and outbound cargo broken down to show whether originating in the continental United States, Hawaii, or foreign countries, and this is broken down between two commercial carriers serving the area and it covers the years 1955 through the first half of 1956. It also shows the dollar value of this cargo, on the commercial cargo. This does We also have here the military cargo, that is, carried by these civilian vessels, of the two carriers who serve that area. not include the cargo that is transported by the Navy. In conclusion, I would like to say that the people of Guam feel that we should have some relief because as you can readily understand, since over half of our population is tied in with the military and have what we on Guam call "commissary privileges," the other half being the natives and the people connected with the civilian economy do not enjoy those privileges. We get all of our products, food, consumer durables, through commercial lines. For example, it costs us, to buy a roll of toilet tissue, more for freight than the cost of the item itself. In fact, I think I was told that a box of toilet tissue runs around $8 and the freight on it is $11. So you can see how our economy is tied in to the shipping and when you realize that our carriers get no subsidy because we are within the confines of the coastwise laws, it makes it a rather hard and difficult situation to put upon our civilian economy, the high rate of transportation that we have out there. That concludes my statement. I would be delighted to answer any questions. Senator BARTLETT. Thank you, Mr. Edwards. First, let me say the exhibit to which you referred will be accepted. |