239 



r will or desire on the part of the U.S. Government^including the 

 tate Department and the Department of Commerce, and, in fact, 

 le industry— to see to it that negotiations in this area are successful. 



We are as much interested as is the U.S. Government to see to it 

 lat those negotiations are successful. In fact, we have some sugges- 

 ons where perhaps by amending the act, Mr. Anderson, we think 

 le negotiating ability and the desire of the Government to negotiate 



ill be improved. 



Mr. Anderson. So it is possible an amendment could make our 

 egotiations more effective rather than less? 



Mr. Felando. That is correct. 



Mr. Anderson. Another remark that was made was on the 100- 

 ercent observers ; that the cost would be, I think— I think the word 

 sed was "insignificant," and "miniscule" and so on. 



Roughly, what would it cost? How little would it be? Is it so 

 nail that it would not mean anything as far as an increase per can 

 f tuna? 



Mr. Felando. Let me say this: Everyone assumes that the vessels 

 wners have a remarkable ability to increase the price of fish. That 

 5 an assumption that I think should not be made, because I have 

 een involved, as has Mr. Royal, and Mr. Royal knows full well that 

 hat is a difficult task to negotiate the price of fish. 



So the suggestion further assumes that we have this ability to 

 ransfer costs to the canners who will buy the fish and that the can- 

 ers in turn will be able to transfer the cost to the consumer. I 

 ave heard that the cost of an observer program would be about $4 

 lillion to $5 million. 



This represents a significant percentage of certainly the boat share 

 f the gross revenue. And I would have to come up with some figures 

 n it. But I think also if the boat owner is going to have to negotiate 

 rith. the union to see to it that it goes on trip expense, believe me, I 

 now I am going to have trouble negotiating with John Royal or, 

 or that matter, Jimmy Bozzo. 



So the fact is that the vessel owner is stuck with this cost. 



Our first job is to see to it how am I going to see to it that this is 

 . trip expense that will be shared by the vessel owner and the crews? 

 ?hat means I have got to start negotiating with the union. That is 

 he other assumption that people are forgetting. 



So the union, I am sure, is going to tell me that this will be a 

 ignificant percent of the gross revenue per trip. 



And I guess it is going to be a fixed expense: Whether we have 

 nough fish to cover the trip cost or not, this expense is going to 

 lave to be paid. 



So sometimes if you have a bum trip, the individual vessel owner 

 las to pay the cost or, for that matter, the crew members and the 



essel owner would. And so this could be a very significant expense 

 >n a trip. 



Mr. Leggett. The expense has not been levied yet. 



Mr. Felando. Well, no, it has not, but he is asking me what would 

 t mean. And I am telling you my first problem, as a vessel owner, is 

 tfho is going to pay for it. 



