Waves of Dependence: Rebuilding U.S. Maritime Strength

By Nizar @Adobe Stock

Arnav Rao of The Atlantic reports that the United States has lost control of its maritime industry, which is now heavily reliant on foreign ships and shipbuilders, particularly those from China. Deregulation since the 1980s dismantled protections that once ensured fair prices and domestic capacity. A bipartisan bill and executive order propose tariffs and tax incentives, but the core issue is the loss of regulated competition. Restoring oversight and investing in shipbuilding and mariner training are essential for national security and trade resilience. Rao writes:

“He who commands the sea has command of everything,” the ancient Athenian general Themistocles said. By that standard, the United States has command of very little.

America depends on ocean shipping. About 80 percent of its international trade by weight traverses the seas. The U.S. needs ships to deliver nearly 90 percent of its armed forces’ supplies and equipment, including fuel, ammunition, and food. Commercial shipyard capacity is essential for surge construction of warships and sealift-support ships that transport equipment and troops in times of national emergency.

Yet the U.S. has an astonishing lack of maritime capacity. Of the tens of thousands of large vessels that dot the oceans, a mere 0.13 percent are built in the United States. China, by contrast, fulfills roughly 60 percent of all new shipbuilding orders and has amassed more than 200 times America’s shipbuilding capacity. […]

The consequences were nearly identical to the pattern in the early 1900s. Shipbuilding all but disappeared in the United States. Today, the U.S. produces five or fewer large commercial vessels a year, and shipyards almost exclusively rely on naval contracts. Worse, at a time of escalating tensions with China, the United States has virtually no surge capacity to build naval or sealift ships. In fact, China builds all the commercial ships that the U.S. government contracts to provide military support.

A bipartisan bill in Congress and a recent executive order seek to address the problem. The plans aim to levy tariffs on Chinese-owned ships and create new tax incentives to spur investment in shipyards, among other provisions. These ideas, though helpful, are too simplistic and small-bore. The central problem is not just inadequate investment or insufficient tariffs. It is the abandonment of a system of regulated competition that structures the industry to meet public purposes. […]