MARAD has released a study to "inform future maritime policy" that writes domestic industry and workers out of the ocean-carrier business. This is just the tip of the iceberg of where the agency has been going recently. Some alternatives are...
President Obama’s Maritime Administration (MARAD) recently released the misleadingly-titled report: "Comparison of U.S. and Foreign-Flag Operating Costs." Based upon the integrated "Study of the Impediments to U.S.-Flag Registry," which included only U.S.-flagged ocean carrier input, MARAD declares as its conclusion: "The information will also be used to inform future U.S. maritime policy." The AFL-CIO Maritime Trades Department has slammed the report and its four unions that man the ships have asked for the removal of MARAD Administrator David Matsuda.
The policy report appears to have been written by AP Moller/Maersk, the foreign-owned mega-oil and gas and shipping conglomerate, and smaller foreign-owned carriers, which overwhelmingly ship U.S. war goods under MARAD contracts and U.S.-flag.
What do the foreign carriers want? No more U.S. crews. No more U.S. repairs. No more U.S. ocean-going builds. Exclusion from U.S. environmental law - which they want dumbed down to the beaches of India. Oh yes, and increasing subsidy by the U.S. taxpayer to destroy what remains of U.S.-flagged and built bluewater capability. The Senate Commerce, Science, and Transportation Committee reported that favorably November 2 to the tune of $2.9 billion out to 2025 for 60 Maritime Security Program (MSP) ships, of which less than 10 are U.S.-owned and none are U.S. build.
Congress and the Obama Administration are going at this wrong. Tax dollars should not support foreign shipping or shipbuilding interests to the detriment of domestic industry.
MARAD is clearly broken. Some fixes are easy: Put the Military Security Program into the Department of Defense (DoD) and pass a law stating all U.S. military cargo goes on U.S.-crewed ships unless there is no U.S. able-bodied seaman willing to pull the watch; Department of Labor can monitor. U.S. repairs on all vessels carrying U.S. military cargo, unless it is an emergency repair authenticated by competent DoD acquisition staff; DoD Inspector General can run an annual audit. Move the National Defense Reserve Fleet (NDRF) back into DoD; after all, through a National Defense Sealift Fund pass-through, they are paying MARAD for NDRF fleet sites, maintenance, and the Ready Reserve Fleet. Allow transparent, competitive sales to pre-qualified domestic recyclers on all remaining federal obsolete vessels. Take all the money saved - or earned -- and put it into U.S. ship building capacity - brown and bluewater; the funding managed by the U.S. Coast Guard which already manages similar sized programs.
As to the environmental law, let's put the Toxic Substances Control Act (TSCA) back where it belongs - at the Environmental Protection Agency (EPA), not at MARAD. In late July, the Obama Administration succeeded in devolving, without rulemaking or legislative authority, TSCA PCB export ban enforcement on U.S.-flagged vessels and off-shore rigs to a "self-certification" scheme run by MARAD without any EPA oversight.
How did this happen? The MARAD report provides some illumination: "There were over 540 U.S.-owned vessels registered in 31 foreign countries, a business practice commonly referred to as flying a flag of convenience." What MARAD fails to mention, is the two largest "flags of convenience" are U.S. corporations based in Northern Virginia: the Liberian flag and the Marshall Islands. The U.S.-owned ships under flags of convenience have been violating the PCB ban with immunity for decades. No U.S.-owned or U.S.-flagged ship should violate the nation's environmental laws and Congress should close that loophole. Unfortunately, it is too late to make it retroactive, so hundreds of U.S. owned or re-flagged vessels have been polluting the Indian Ocean and the estuaries of China these past few years.
Since successive Administrations have allowed foreign and U.S. shipowners to knowingly violate the PCB export ban, it is only fair to have a make-up action: a 10 year waiver on the PCB import ban for vessels and marine structure disposal at domestic recycling facilities that comply with EPA and OSHA regulations for managing PCB's to U.S. standards. Cradle-to-grave; after all, the U.S. produced the majority of PCBs in use.
The Obama Administration and Congress need to focus on the domestic policy issues that are important to managing the domestic and international waterborne movement of goods which is so vital to our economy. Then the domestic maritime industry – from sea to shining sea -- can focus on creating domestic jobs.