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MarAd Charting Course for National Maritime Strategy

MarAd Administrator Chip Jaenichen outlines plans for a national maritime strategy.
MarAd Administrator Chip Jaenichen outlines plans for a national maritime strategy.

The head of the Maritime Administration (MarAd) told the MTD Executive Board that the Transportation Department agency is closer to issuing a national maritime strategy.

Maritime Administrator Paul “Chip” Jaenichen stated MarAd “has been taking steps” toward this goal since launching a series of meetings and briefings almost two years ago on where the industry should be headed. He addressed the MTD Executive Board on Friday 20 during its annual meeting in Atlanta.

“It’s imperative that we take serious and comprehensive steps to fortify our domestic maritime industry and reverse the declining trend of the U.S.-flag fleet trading internationally,” he said. “The Maritime Administration has been taking steps. We started in late 2013 and we kicked off our effort to develop what we refer to as a strategic framework. That framework is going to inform Congress and federal departments of the challenges facing our industry and to identify those actions that will need to be taken in the short and long term … to be able to sustain and reinvigorate our fleet.”

In working with industry stakeholders to develop a strategy, “the feedback and guidance that we got was both substantial and invaluable,” Jaenichen said. “The Maritime Administration has carefully documented all of that information. We’ve analyzed it, we’ve organized it, and we put it into a product and we have shared it with the Marine Transportation System National Advisory Council (which communicates with the U.S. Secretary of Transportation).”

He described some of the “tenets” the administration will use to finalize the strategy.

“We have to sustain and strengthen the Maritime Security Program, which is a group of 60 commercial vessels which is the core of our U.S.-flag international trading fleet, and they are required by the Department of Defense to be able to globally project our armed forces,” he noted. “We want to reduce the operating and maintenance costs for U.S.-flag vessels, shrink the U.S.-flag cost for compliance, maximize access to U.S. government preference cargoes and provide monetary and non-monetary incentives for shippers to put cargo on U.S.-flag vessels.

“Another of our tenets is the strong and enduring support of the Merchant Marine Act of 1920,” the administrator continued. “Most of us know that as the Jones Act. Other tenets focus on establishing robust futures for the U.S.-flag vessels in domestic trade and that includes growing what we refer to as American marine highways.”

He said that’s not a comprehensive or final list. All of the strategy’s components will show up in a noticed of proposed policy.

He vowed to continue fighting for the revitalization of the American-flag industry, and stated he is counting on the MTD and other allies to keep supporting those efforts.

Jaenichen opened with a Thomas Jefferson quote from 1806, when the nation’s third president told Congress that America’s “policies may be influenced by those who command our commerce.”

“That statement is as true then as it is now,” he declared. “Ninety percent of all of our commerce is transported by ship, and we have a substantial reliance on foreign-flag vessels [including] vessels flying flags of convenience, which places our national sovereignty and our domestic maritime labor pool in an extremely vulnerable position.”

Jaenichen then described various declines in the maritime industry before explaining how to reverse those trends. He said the nation’s reliance on foreign-flag ships to deliver commercial cargo “has come at the expense of the U.S.-flag fleet and the U.S. Merchant Marine.”

The industry also has experienced a downturn because of fewer preference cargoes, the closings of American military bases overseas, and the drawdowns in Iraq and Afghanistan, Jaenichen added.

Jaenichen wrapped up his remarks by crediting the MTD for its effective advocacy, and he also reiterated the Obama administration’s backing of the industry.

“For the first time, marine transportation has shed its low profile at the Department of Transportation,” he pointed out. “Our voice has been heard… The administration understands that for nearly 240 years, we’ve had a merchant marine that’s proven essential to our economy and our national defense, and that’s why the president is on record supporting the Jones Act, and that’s why he and Vice President Biden have visited as many ports in the last 24 months as the previous two administrations combined.”

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