A bill to make certain United States-flag vessels eligible for operating-differential subsidies under the Merchant Marine Act, 1936.
Key claim: A U.S.-flag liner operator that recently took delivery of new U.S.-built ships could designate up to 12 of its existing foreign-built U.S.-flag ships so those ships would count as U.S.-built and qualify for federal operating-differential subsidies.
Abstract
(S2510 · 100th Congress) Allows an operator of U.S.-flag liner vessels which has taken delivery from a U.S. shipyard of new U.S.-built liner vessels within the last two years to designate not more than 12 existing U.S.-flag foreign-built vessels, meeting certain criteria, which it is currently operating. Deems the vessels so designated to have been U.S.-built for purposes of provisions relating to operating-differential subsidies. Latest action (1988-07-12): Subcommittee on Merchant Marine. Hearings held.
Why this matters
Operating-differential subsidies historically compensate U.S.-flag operators for the higher cost of American crews, but eligibility has been tied to U.S.-built hulls. Proposals like this narrow 1988 bill illustrate the recurring tension between the Merchant Marine Act’s build-American requirement and operators’ reliance on cheaper foreign-built tonnage, a tension that continues to shape modern maritime subsidy debates.