U.S. Sen. Roger Wicker, R-Miss., chairman of the Committee on Commerce, Science, and Transportation, will convene a hearing titled, “The State of the American Maritime Industry,” at 10:00 a.m. on Wednesday, March 6, 2019. The hearing will focus on the current state of the domestic maritime industry in anticipation of the FY20 budget request and discuss priorities for the Coast Guard and MARAD reauthorization bills.
- Mr. Thomas Allegretti, President, American Waterways Operators
- Ms. Berit Eriksson, Workforce Development Director, Sailors’ Union of the Pacific
- Mr. Austin Golding, President, Golding Barge Line
- Mr. Matthew Paxton, President, Shipbuilders Council of America
- Mr. Matthew Woodruff, President, American Maritime Partnership
*List subject to change*
Wednesday, March 6, 2019
Committee on Commerce, Science, and Transportation
This hearing will take place in the Hart Senate Office Building 216. Witness testimony, opening statements, and a live video of the hearing will be available on www.commerce.senate.gov.
*Note: Witness added on 3/4/19.
Chairman Roger Wicker
We convene this morning to hear testimony on the state of the American maritime industry. We are delighted to have five witnesses who reflect the breadth of this industry:
- With Mr. Matthew Woodruff, President of the American Maritime Partnership;
- Mr. Thomas Allegretti, President of the American Waterways Operators;
- Mr. Matthew Paxton, President of the Shipbuilders Council of America;
- Mr. Austin Golding, President of Golding Barge Line, based in Vicksburg, Mississippi, with 225 employees in 11 states. I note that Mr. Golding is joined by his family today and the Mayor of Vicksburg, the Honorable George Flaggs is with us too for support for the maritime cause;
- And Ms. Berit Eriksson, Workforce Development Director for the Sailors’ Union of the Pacific.
We are grateful that all of you are able to be with us today and we look forward to your testimony.
The economic and national security of our country depends on a healthy maritime industry. Indeed, our country’s independence can be tied to the success of private colonial ships and merchant seamen that were authorized by General Washington to prevent British ships from delivering arms and ammunition.
Today, maritime freight transportation supports about $4.6 trillion in annual economic activity and the maritime industry supports 650,000 U.S. jobs. According to the Transportation Institute, 22,500 jobs in Washington State and 13,400 jobs in Mississippi are dependent on various elements of the American maritime industry.
Over 1.3 billion metric tons of waterborne merchandise is imported to, and exported from, the United States each year. And almost that much cargo is carried on the 25,000 miles of inland waterways.
Equally important to the economic benefits, a strong domestic maritime industry is essential to national security.
DOD relies heavily on U.S.-flagged commercial vessels and civilian mariners to meet its sealift requirements. The U.S. Coast Guard and the Maritime Administration are critical components to all of our defense and maritime functions and the committee will be working to reauthorize these agencies.
Federal law supports a strong domestic maritime industry. Notably, the Merchant Marine Act of 1920 – better known as the Jones Act – requires that vessels transporting goods between two U.S. points be American-built, owned, crewed, and flagged.
Today, over 41,000 Jones Act-qualified vessels operate in the domestic trades. Properly enforcing the Jones Act is important for economic and national security.
I recently sent a letter to the President – along with several colleagues on this committee – to express support for the Jones Act and to encourage the administration to convene a meeting of all stakeholders to discuss how the domestic maritime industry can meet new demands and serve new markets.
The American shipbuilding industrial base is capable of building the vessels necessary to carry the nation’s abundant energy resources – such as LNG and other fossil fuels – anywhere in the world.
Becoming more internationally competitive is important to secure the industry’s future. Currently, there are only 81 U.S.-flagged ships operating exclusively in international trade, carrying less than two percent of the nation’s annual foreign trade.
This is troubling from a national security perspective because sufficient U.S.-flagged ships and mariners must be available to meet national defense requirements.
As to workforce, MARAD estimates a shortfall of 1,800 qualified mariners needed to sustain a prolonged military sealift mobilization. As a member of the Board of Visitors for the U.S. Merchant Marine Academy, I would note that Jack Buono was recently named Superintendent there and is working to recruit and train mariners to fill this shortfall. We wish the U.S. Merchant Marine Academy and other training academies well.
In that regard, let me express my support for the Trump Administration’s new initiative to help active-duty military and veterans transition to maritime careers. The initiative will build on the successful Military to Mariner program managed by the Coast Guard and MARAD.
During today’s hearing, I hope witnesses will address issues such as:
- The laws and regulations affecting the operation and competitiveness of industry;
- The current and future impact of the Vessel Incident Discharge Act, legislation that many of us sponsored last Congress was included in the 2018 Coast Guard Reauthorization bill. Like so many issues, getting VIDA signed into law would not have been possible without the coordination of the committee’s Ranking Member, Senator Cantwell. And I also salute the efforts of Senator Sullivan in this regard.
Also, members might want to comment on strategies to grow the maritime workforce and improve education and training programs.
America is a maritime nation. We have a distinguished history of using our abundant maritime resources to expand commerce and protect our country. A strong merchant marine, ship building, and maritime industrial base are the marks of a great power. I look forward to working with my colleagues to ensure America’s maritime industry has a vibrant future.
And I now turn, to my friend, the Ranking Member, Senator Cantwell, from another great coastal state.
Ranking Member Maria Cantwell
That is why we call them the Seattle Mariners, by the way.
Thank you, Chairman Wicker, and thank you for holding this important hearing today, and welcome to the witnesses. Thank you for being here to bring more attention to the needs of investment in our maritime sector. I’m happy to welcome our witness from Washington, Ms. Eriksson. Thank you so much for being here. You’ve been part of the maritime economy in our state for a long time and representing the Sailors’ Union of the Pacific today, we thank you for that. I know we are going to talk about workforce, the chairman mentioned it, but I’m sure you’ll bring a particular perspective to that in your testimony.
The United States maritime transportation system is critical to our nation’s economy and to our security. With 90% of overseas trade entering or leaving the U.S. by ship, contributing $650 billion annually to our GDP, this is a very important part of our economy, with 13 million jobs nationwide. The large freight network supports more than 40 million jobs nationwide. And these jobs fuel an entire economy, supporting trade and the movements of goods. In the state of Washington, we know this because we have nearly 70,000 direct jobs – the chairman mentioned the indirect jobs also associated with that sector – and so you see the large economic footprint that we’ve had in the past. So whether it’s ports connecting to freight corridors, warehouse sector, maritime ship building, cruise operations – we know the value of the maritime sector in the state of Washington.
But despite the importance of the movement of freight and investing in freight infrastructure, that investment continues to lag. According to the National Association of Manufactures 2019 Building to Win report, more than 70% of manufactures do not believe our infrastructure can respond to the competitive needs of a growing economy. Americans are losing thousands of dollars every year because of crumbling infrastructure, and the American Society of Civil Engineers rates our infrastructure at D+. Accordingly, the World Economic Forum report ranks the United States 9th in infrastructure quality.
Other countries know the importance of infrastructure investment, and we need to keep pace. The 2015 FAST Act took a big step to addressing our freight infrastructure challenges with a multi-modal freight program, and I thank Senator Thune and others for helping to get that done. However, we need to do more in this area. We must support our domestic maritime industry with a strong U.S. maritime workforce. I look forward to working with the Chairman on this particular issue.
The mariners are a special part of our economy, and they are critical to meeting our transportation needs and our military needs. In recent years, the merchant marine has also provided essential support for the Department of Defense missions during devastating storms, like Hurricane Katrina, Rita, and Superstorm Sandy. But, despite the benefits the merchant marine has provided, it’s at a crossroads. The U.S. flag fleet has experienced a decline, and we are facing serious shortage of mariners. And we need to make sure that we are making the investment in the workforce of mariners a key priority.
In addition to the strong support of the Jones Act, this committee should considers supporting investments in vessel recapitalization programs. The Pacific Northwest fishing fleet has begun efforts to rebuild its vessels in American shipyards, which supports thousands of jobs and, obviously, rebuilding and capitalization of both the Coast Guard and NOAA fleets, is another big area of infrastructure need that we need for our workforce.
One particular point I want to make is that while we have secured the first heavy polar icebreaker funding in decades, I want us to authorize even more. It’s imperative that our nation understand that we are an artic nation. That this is an entirely new transportation path with many opportunities for us to forge new relationships. But to do that, we will have to have an icebreaking fleet. So I look forward to working on that issue with many of my colleges on this committee.
The United States must also provide certainty for our workforce by developing a national maritime strategy that identifies the increase in the availability of U.S. ships to ensure mariners and qualified women are there to help with the challenges of increasing cargo and capacity. We must continue to bolster and support the ship building industry on this infrastructure issue, which I know many of the witnesses will address today.So, Mr. Chairman, whether it’s developing the workforce, focusing on infrastructure, supporting shipyards, supporting the Coast Guard, or new shipbuilding for the fishing sector, I know there is a lot that our committee can do to help this particular sector of the US economy. So I look forward to hearing from the witnesses today and looking forward to suggestions on how we can help this transportation sector of our economy.
Witness Panel 1
Mr. Thomas AllegrettiPresidentAmerican Waterways Operators
Ms. Berit ErikssonWorkforce Development DirectorSailors’ Union of the Pacific
Mr. Austin GoldingPresidentGolding Barge Line
Mr. Matthew PaxtonPresidentShipbuilders Council of America
Mr. Matthew WoodruffPresidentAmerican Maritime Partnership