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As a matter of fact, the petroleum industry alone in the past several 

 years has contributed far more annually to the U.S. Treasury, just from 

 its oceanic operations, than the Federal Grovernment has spent on ocean 

 development, excluding defense. The petroleum industry in 1968 paid 

 $1.6 billion into the U.S. Treasury from its offshore leases and opera- 

 tions. Furthermore, this figure does not include corporate income taxes. 

 In addition to this, the offshore petroleum industry has invested many 

 billions of dollars in fixed assets in order to carry out these offshore 

 operations. Compare this with the recommendation of the Commission 

 that the Federal Government increase its spending for the next 10 

 years by an average of $800 million annually over the present $500 

 million rate. Even at this increased level, future Government expendi- 

 tures will still be substantially less than those of the offshore petroleum 

 industry. 



If I have any disagreement at all with the major recommendations of 

 the Commission, it is that an increase in expenditures of only $8 billion 

 over the next 10 years is pitifully low. It is my understanding that the 

 Federal Government spends $17 billion per year on all of its research 

 and development programs, but of this only $500 million goes into 

 oceanic E. & D. This is only 3 percent of the total and yet there is tre- 

 mendous profit potential in oceanic development. This reflects a corre- 

 sponding tax potential which the Federal Goverment should recognize. 



Under these circumstances, I am amazed that oceanic R. & D. gets 

 such a small percentage of the total. I suspect that the primary reason 

 for this is that the Federal oceanic work is so fragmented among over 

 20 agencies and departments that a good case for oceanic R. & D. has 

 never been presented to the Congress. Of course, this emphasizes the 

 great need for a strong civil agency to administer the Federal oceanic 

 R. & D. programs excluding defense. 



The petroleum industry is the leader in the free enterprise sector, 

 but expenditures by such industries as food, maritime, recreation, 

 chemical and mining are also substantial. You can see then that the 

 Federal Government is indeed a distant second when compared with 

 the total annual expenditures by the entire free enterprise sector. The 

 Federal Government will continue to be a distant second even with the 

 implementation by Congress of the recommendations of the Commis- 

 sion. Remember that expenditures by the private sector are possible 

 only because industry is willing to invest out of today's land-based 

 profits in expectation of future offshore profits. 



Hence, the Commission wisely recognized that in a truly national 

 oceanic program industry would be a crucial segment. The Federal 

 Government must recognize the vital roles of the free enterprise sector, 

 of the States and regions, and of the academic community. A national 

 program must have built into it organizational arrangements for ob- 

 taining information and advice from the entire marine community. 

 Account must be taken of the accumulated knowledge and expertise 

 from all these segments. National goals and objectives must be estab- 

 lished with due regard to the commitments, capabilities, and long-range 

 interests of each of these important contributors to oceanic 

 development. 



Also a course for federally funded activities must be charted that 

 will not hinder or duplicate effort by nongovernmental sources. Finally, 

 leadership and stimuli must be provided for continued, and hopefully 



