1998 Year of the Ocean The U.S. Marine Transportation System 



operators enjoy substantially lower operating and capital costs with less stringent safety, 

 construction, and environmental requirements. They also benefit from more modern shipyards, 

 and less expensive labor from developing countries. Given these conditions, the role of the 

 federal government in defining and protecting U.S. national interests will need to be addressed in 

 the years ahead. The U.S. merchant fleet currently carries three percent of U.S. -foreign 

 waterbome trade, with the remaining 97 percent hauled by foreign-flag operators. 



Even though its share has declined, the quantity of cargo carried by the U.S. fleet 

 generally has increased — from 25.2 million long tons in 1970 to 28.3 million long tons in 1996, a 

 12.5 percent increase. The absolute increase in cargo carried on U.S. -flag vessels reflects the 

 deployment of larger, more productive U.S. -flag vessels since the 1970s. 



Domestic Shipping 



Domestic shipping includes commerce on the Great Lakes, the inland waterways, and in 

 the domestic ocean trades. Annually, over one billion short tons of cargo move in the domestic 

 trade (24 percent of all U.S. cargo on a ton-mile basis) at less than 2 percent of the entire 

 domestic freight bill ($422 billion in 1995). U.S. domestic waterborne shipping generates $8 

 billion in annual freight revenue. Domestic shipping serves over 90 percent of the U.S. 

 population, and carries approximately 65 million passengers each year on domestic vessel cruises 

 and passenger ferries. Approximately 124,000 people are engaged in a variety of domestic 

 shipping-related activities, including an estimated 80,000 employed in seafaring and non- 

 seafaring positions on board U.S. -flag vessels operating in the coastwise and inland waterway 

 trades. Long-standing U.S. law limits commerce between U.S. ports to U.S. -flag vessels. 



Ports 



There are 355 ports in the United States that handle cargoes at some 4,000 marine 

 terminals. Ports and marine terminals are intermodal transfer points where cargo is moved from 

 one mode of transportation to another. While the surface transportation is generally efficient, 

 improvements are needed at the transfer points in our ports. The importance of these intermodal 

 interchange points is recognized in the National Highway System Designation Act of 1995. The 

 Act identifies 240 connectors between the nation's highway system and the 150 port and marine 

 terminals that handle nearly all U.S. waterbome freight.. Predicted growth in international 

 waterbome commerce will increase the demands on U.S. ports' infrastructure, intermodal 

 connectors, and the entire transportation system. The infrastructure of U.S. ports is critical for 

 national economic health and protection of U.S. national security interests. 



Ports must be able to accommodate the larger vessels coming into service. Ports must 

 also upgrade cargo-handling equipment and operational procedures to increase the speed and 

 volume of cargo throughput. In general, larger and faster ships and advanced port container- 

 handling equipment will enable terminal operators to move more cargo and increase labor 

 productivity. The labor force of the future will have to be highly skilled to operate the equipment 

 and systems needed for tomorrow's ports. Unless necessary port infrastructure improvements are 



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