Wanted: New Ships for Old Glory

Right now, the only large oceangoing cruise vessels under the U.S. flag in U.S. waters are the Independence and the Constitution of American Hawaii Line.

For a nation of 240 million, established as far and away the world’s largest cruise market, two ships in the 18,000-tons-and-up range don’t represent an extensive fleet. In fact, there are those who see it as something of a national shame.

A bill before Congress would change all that. It would allow up to five ships built overseas and under foreign control to fly the U.S. flag after they are sold to operators in this country. Currently, only ships whose hulls were laid in yards in the United States are eligible to carry the flag.

Meeting Jones’ Terms

The bottom line for the cruising public is that this shortage of tonnage in the U.S. fleet severely restricts the variety of cruise product available. Foreign-flagged vessels must meet the terms of the so-called Jones Act, this country’s cabotage law, which doesn’t allow them much flexibility.

They cannot, for instance, operate cruises between two U.S. ports unless their itineraries also include an equal number of foreign ports. That, of course, makes the Independence and Constitution the only big ships that can legally sail among the Hawaiian Islands.

How do we go about increasing the number of ships in the U.S. cruise fleet? One way, perhaps on paper the simplest, is to build more ships in this country.

Ah, there’s the rub. The cost of such a venture is considered prohibitive in today’s world market.

Supportive Governments

The Japanese, the Finns, the French and others all build cruise ships less expensively than they can be built here. And what’s more, their governments are so anxious to support their shipbuilding enterprises that they offer low-interest loans, tax breaks and a variety of other incentives for prospective customers; the U.S. government does not.

Occasionally we get word of a company that is about to announce its plans to commission an American shipyard to build a liner, but nothing ever seems to come of it.

Which brings us to the second possible fleet-expansion maneuver, the one that occurred to Alaska Sen. Ted Stevens when he wrote the bill now under Congressional consideration--allow U.S. operators to buy a few foreign ships and reflag them as American. The bill would provide the exemption needed.

It would allow five vessels to be re-flagged, but there are really only two likely to make the jump quickly if the Stevens’ proposal becomes law. A Fort Lauderdale, Fla., firm called Cruise America has offered to buy two ships from Britain’s Cunard Line, the Cunard Countess and the Cunard Princess, if they can be re-flagged and made eligible for U.S. intercoastal service.

Threat of Cancellation

The odd thing is that every time the Senate Merchant Marine subcommittee, of which Stevens is the chairman, meets to consider the bill, somebody announces a plan to build a ship in a U.S. yard and warns that the construction will be canceled if the Princess and Countess are freed from the restraints of the Jones Act.

The argument is that the added competition would make building a ship too risky a proposition.

The most recent of these announcements was by a company called American Ship Building, of Tampa, Fla. It came just as the subcommittee was going over the bill one more time.

Baseball fans may recognize American Ship Building as the source of the fortune that made it possible for George Steinbrenner to buy the New York Yankees.

Because Steinbrenner has shown himself willing and able to spend huge sums of money on ball players, some people in Washington believe that this time--maybe, possibly, perhaps--one of those “phantom” ships will be built.

That means, of course, that the Stevens bill will be put back to the bottom of the pile again. Stevens, for one, is unconvinced. After the American Ship Building announcement he was quoted as saying, “I’ll believe it when I see it.”

Pride of the Past

Two other projects, whose principals invariably argue against the Stevens bill when it comes up, involve the Santa Rosa and the revered United States, once the Atlantic’s fastest, most luxurious liner, in the days when transatlantic passenger service was shipping’s prestige product.

Vintero Corp. of New York, which owns and promises to reintroduce the Santa Rosa, and United States Cruises of San Francisco, which is trying to get the United States back to sea, both warn that their efforts would be discontinued if the U.S. fleet is opened to foreign hulls.

That would mean, presumably, a loss of tax revenue and, worse, the loss of jobs for American workers and suppliers. And no legislator wants to do anything that would cause that to happen.

But subcommittee members wonder how long it will take to get the projects off the ground. Getting the United States back into service is going to cost $250 million and the Santa Rosa $150 million, according to the owners’ figures.

So far, reconstruction work has not begun on either project, although in each case the intention was made public several years ago. Where, the legislators want to know, are the jobs and revenue that allegedly will be lost?

Cities Lose Revenue

In the meantime, revenue is being lost by a lot of cities that might find themselves in cruise brochures if there were more U.S. flag ships, places in the New England states, the Gulf Coast, the Pacific Northwest and Alaska.

As long as the vast majority of cruise lines have to match foreign ports with U.S. ports in planning their routings, places like those are going to be left out in the cold; the lines will stay with tried and true itineraries.

The Cunard Princess and Countess would be more likely to experiment with new ports of call and new market areas if they were re-flagged and free from the shackles of the Jones Act. Why would they want to butt heads with the others when they could carve themselves a niche in areas where they’re protected from head-to-head competition?

That’s why American Hawaii has been so successful in its inter-island cruise service. As George Steinbrenner might say, “They’re the only ballgame in town.”

Ted Stevens would like to make it a doubleheader.