283 
value would be so dependent on hazardous and subjective extrapola- 
tions as to be highly suspect). Rather, the question that intrigues 
this author is whether or not the civilian economic contribution of 
these fleets alone suffice to make them cost-effective; whether their 
military contribution might in fact be seen to come gratis? 
Even with such an extreme postulation, definitive answers cannot 
be given. There is for example no sure way of calculating the opportu- 
nity costs, to the Soviet economy, of the ships, ports, and port-related 
air and land infrastructure. But some comments can be made with 
confidence. 
THE MERCHANT MARINE 
First, as regards the merchant marine. Among its apparently 
uneconomic designs may be counted a demonstrated Soviet willingness 
to cut certain rates below what is considered in the West to be 
economically viable. The question does not concern the accepted 
fact of Soviet willingness at times to consider unfavorable economic 
returns as compensated by political or other rewards—of this there 
is no doubt. Rather, the question is whether there are economic 
considerations which allow one to avert recourse to this “‘fall-back”’ 
logic. 
The first point to be made again relates to economies of scale. 
There is little doubt that the opportunity costs of maintaining a certain 
number of subsidized lines weighs less on a centrally coordinated 
fleet of the size of the Soviet merchant marine than it would on 
smaller independent operators. Furthermore, the direct cost of operat- 
ing a Soviet ship may in fact also be less than average, in view, 
that is, of presumed lower salaries, and lower overall fuel costs. 
The second point to be made is that Soviet “dumping” of ship 
rates, as also of export prices in general has never proved permanent. 
It has been used to break into cartels, and to ensure a piece of 
the cake (cum market).*° Successful market penetrations have been 
followed by more commercial rates. As concerns the shipping cartels, 
or “Conferences,” it may well be that the receipt of capitalist commer- 
cial returns following Soviet membership more than makes up for 
the loss entailed by elbowing in. 
The immense ocean and ocean-bed research effort is still more 
impervious to traditional calculations of economic benefit, since it 
essentially represents an investment in the future. But one might ven- 
ture that the promised bounty from a “‘harvesting’” of ocean-floor 
mineral nodules alone suffices to make the speculation attractive.” 
THE FISHING FLEET 
Perhaps the dilemma, or question is best explored through a focus 
on the fishing fleet. Two activities come to mind. One is the fishing 
of krill off Southern Africa. This must at least initially have been 
uneconomical, in view of the previously discussed problems of loca- 
0 The Times (of London), Jan. 21, 1969; see also i.e. Carlson, “‘U.S. Naval Inst. Proceedings,” 
May 1967, and Foreign Report, March 11, 1969. 
®! For Soviet testimony, see above; for Western estimates, see the proceedings of the Caracas Law 
of the Sea Conference, and the position papers prepared for the followup 1975 Geneva Conference. 
(The now recognized potential for ocean-floor mining galvanized the efforts toward the establishing 
of a controlling international agency.) 
