War is the hardest of teachers. Its lessons should, therefore, be doubly heeded.
Of all the lessons to be learned from the recent conflict, two stand out as guides which must govern our present and future policies: first, the world must have peace; second, the United States must remain defensively strong in order to have that peace.
The age-old conception of defensive strength in peacetime as an impregnable wall has become obsolete. It is now the ability to discourage attack, based on potential to counter-attack, which alone can assure security. At a time when war involves the mobilization of an entire nation, this cannot mean full armament. Full armament in peacetime can signify only preparation for aggression. Defense calls for an adequate, alert, well balanced nucleus from which to build an armed force in time of need, plus an industrial organization that can be converted to necessary wartime production in time to meet wartime needs. Since speed will be sure to be an outstanding characteristic of another war, the increasingly vital factors in a defense against it must be alertness of the military and sound, well balanced industry.
The vital role of industry generally in the recent war cannot be overemphasized. There was none, however, whose part was more important than that of the Merchant Marine. In fact, it was so often thought of as an auxiliary to the armed forces that we are apt to forget that it was really a peacetime industry mobilized for war. It is an essential part of sea power. Without the transport provided by the Merchant Marine and by merchant ships converted for military service, neither Army, Navy, nor Air Force can operate away from our own shores. The more highly mechanized war becomes, the more important becomes transport. Air overseas transport has taken on greater and greater importance, but rather than displacing surface carriers, has actually increased their importance. The faster tempo of air warfare calls for greater quantities of material. Also planes themselves need bases and supply facilities if they are to operate over great areas. The experience of the past war has proved beyond a doubt that sea power and ship transport will play a vital role in any war we might be called upon to wage in the foreseeable future. For the present at least, a Merchant Marine is a necessity for our national defense.
This lesson was learned in 1917 but was soon forgotten as our Merchant Marine rapidly fell back to its decadent prewar state. Again, when war came, it took costly time and tremendous expense to build our shipping up to the necessary wartime minimum. We rediscovered the fact that a Merchant Marine built under these conditions is many times more costly to the nation than one built for peacetime use. It cannot be otherwise when everything must be sacrificed for speed: materials are scarce and costly; labor is expensive and inexperienced; overtime work increases costs; substitute materials and short cuts reduce the quality of the finished vessel. Furthermore, the vessels built under a wartime program cannot be built to the requirements of a particular peacetime trade. When peace comes, therefore, there are but two alternatives—either an expensive reconversion, which adds still more to the capital investment, or running perpetually at a competitive disadvantage. Finally, it would take an extremely large operating loss to prevent a vessel in peacetime trade from paying back at least part of its construction cost, whereas a vessel used for war service and then laid up must have its total cost charged as a war expense and borne by the government. Building a merchant fleet under emergency pressure is far from economical and necessarily takes time at a period when time means lives, greater expense, and possible defeat.
There are few Americans who will disagree basically with the above statements. They will ask, however, why this matter should be expounded at this time when the United States boasts the largest merchant tonnage of any nation in the world. The people of this country, including some of their representatives in government, do not realize that, notwithstanding the large tonnage figures, our Merchant Marine now faces as critical a condition as it has at any time since 1917. It is questioned whether, if the facts were known, the Merchant Marine would again be allowed to drop below our national defense and commercial requirements.
In the first place, it must be noted that the bulk of our present merchant tonnage was war built for war purposes; that much of it is being laid up or will be laid up as soon as the inflated post war demand for cargo space subsides. As trade returns to normal, and as foreign competition—largely new or recently converted tonnage—increases, more and more of our wartime fleet will become submarginal. At that time only a well balanced fleet, balanced as to trade routes and also as to types of carrier, composed of vessels well adapted for their respective trades, can compete economically. This means extensive conversions, a rounding out of the merchant fleet with new construction, and the constant replacement of over-age and other submarginal vessels. Without such a program, either the Merchant Marine will disappear or subsidies to maintain it will become excessive.
To round out our present merchant fleet the greatest need is for passenger vessels— our “C” type cargo carriers and our tankers are second to none. It is not always realized that even at the end of World War II, we were short of ships convertible to or from passenger liners. We always lacked sufficient
American vessels to meet our wartime needs for troop carriers and hospital ships. As a result, we relied heavily on vessels under allied flags or enemy vessels taken in this war or in World War I. We were dependent on others for this type of vessel and would be again if war were to come in the near future. Unless, therefore, we immediately reestablish ourselves in the regular peacetime passenger trades and expand from there, our passenger fleet, vital as it is to national defense, will soon disappear.
The passenger and cargo ships which we do have, can of course be laid up. In this case they would then represent no more than tonnage figures. A laid-up fleet is a dead fleet where ships depreciate rapidly, become obsolete and are not replaced, and are useless unless crews are available to fully man them when they are needed. Seamen, beached today, cannot be called back years hence to man such a fleet at a moment’s notice. If the merchant seamen who made such a glorious name for themselves in the war are forced to leave the sea, we will have lost a great national asset for both defense and for peacetime trade. To be ready and adequate for national defense in time of war, the merchant marine must be a going concern in peacetime.
Vital as is the role of the Merchant Marine for defense, any discussion of its place in our national life would be incomplete without a mention of the part it plays in our peacetime economy. Basically it is as much a part of our business life as farming, railroading, or manufacturing. No nation with thousands of miles of coast line and the world’s finest harbors can help being a maritime nation. We must have shipping. The only question is whether we will handle it ourselves or leave it to others. The American shipper’s money is either paid to Americans to maintain our Merchant Marine—paid to give jobs to America’s seamen, shipbuilders, equipment manufacturers, steel workers, etc.—or else it goes out of the country. Either we operate sufficient tonnage to handle a substantial percentage of our import and export trade, or we place this trade under the control of foreign nations—nations which will naturally place our interests second to their own and subject our trade to disruption from circumstances affecting any one of these countries.
The years 1914-1917 and 1939-1941 should have taught us that to make our foreign trade dependent on foreign carriers is to saddle our export manufacturer with an additional element of uncertainty as to his products reaching their markets—a burden which his foreign competitors do not have to bear. This situation also deprives the American business man of a valuable contact with his foreign market or source of material, actual or potential. The American operators of vessels in foreign trade depend virtually 100 percent on the carrying of cargoes to and from the United States. They are, therefore, vitally interested in promoting American foreign commerce to the benefit of themselves and their shippers. No foreign operator can have such an interest in American business. To reduce, rather than expand, our shipping representation abroad at this time would be to cut out a valuable foreign contact, just when we need more than ever before to learn more of the world and to understand other peoples better. It should not be forgotten that in planning some of our wartime operations in the Pacific, we had to go back to whaleship logs and charts of one hundred years ago for the information on certain islands. We cannot afford today to be such strangers to any part of the world.
It has been suggested that we should abandon our Merchant Marine and concentrate on more profitable enterprises, leaving our import and export shipping to nations to whose livelihood shipping is considered more vital. It is argued that their increase in this nation’s shipping business would give them a better credit balance and would increase their purchases of our manufactured products. This reasoning is basically fallacious. Our complete withdrawal from foreign shipping would mean but a small percentage increase in tonnage carried by any one of the many countries which would benefit. This would have to be the case, since the total trade with any one country is but a small percentage of the total tonnage carried by the ships of any maritime nation. Also, the additional foreign exchange which would accrue to these various countries would not all be spent in the United States. It is inconceivable, therefore, that withdrawing all our ships from foreign trade would materially benefit American industry as a whole. It would certainly cause no such expansion as would be required to give jobs to the thousands who would be thrown out of work by such a move. There are undoubtedly many nations that would rejoice at such a magnanimous act on our part, but the benefit to us is hard to visualize. The question also arises as to why shipping was singled out for this move. Why not do away with our glass industry to help the glass makers of Sweden and Central Europe, or close out our watch and clock makers to help the Swiss, or shut down the garment business to give more business to London tailors and Paris dressmakers? Certainly none of these moves would weaken our national defense as much as giving up our Merchant Marine, nor would their effect on American business as a whole be nearly so great. American business needs a strong Merchant Marine.
Inseparably connected with the Merchant Marine, and itself an indispensable adjunct of our Navy, is the shipbuilding industry. Its production of merchant and Naval vessels when they were vitally needed was unquestionably one of the decisive factors in the war. Yet now, when the brains and skills which worked that miracle of production should be turned to building better ships at less cost for peacetime needs, America is a land of empty shipways. Naval construction is at a very low point, private ship operators are discouraged from building by our uncertain maritime policy, the government shipbuilding program started in 1936 and disrupted by the war has been suspended. The entire industry is facing its worst period in thirty years. Due to the nature of the shipbuilding business, this is a particularly serious matter.
A ship is one of the most complex of man’s mechanical creations. The shipbuilding yard is accordingly a very complex organization comprising a group of specialists within a specialty. The number of key men, therefore, who must be retained to keep a working force in being is larger than for almost any other industrial organization of similar size. There are pipefitters, electricians, machinists, sheet metal workers, riveters, welders, steel workers, carpenters, joiners, to mention but a few. Each is a specialist whose trade must be a part of the shipyard organization. Each is also a shipbuilding specialist, a training not readily available on the labor market. Only the building of ships can keep such an organization together; only such an organization can build ships.
Another critical feature of the present shipbuilding situation is the fact that many of the executives, engineers, and supervisors who carried the burden during the war program were men who started their shipyard experience with the shipbuilding revival during World War I. Many of these experienced men are now close to retirement age, and their places must soon be taken by younger men—men who must get their training from active, not idle shipways. Without trained leadership the industry cannot discharge its vital responsibilities in peace or war. Also, no industry that is not active and that does not offer definite opportunities for the future will attract the proper type of new blood which is needed year by year to maintain its vitality. The shipbuilding industry is no exception.
To compete in international trade, American ship operators must have good, up-to- date ships. American shipbuilders and seamen are higher paid than their foreign counterparts. So were American ship men in the days of the packet ships when this country was the world’s number-one maritime power. So are American workmen in almost every other industry today. Although paid more, the American worker meets foreign competition by producing more, or better, goods through his native intelligence and better education, and through having better tools supplied to him. The tools the American ship man must have in order to compete in foreign trade are better ships. The alternative is excessive subsidies.
America has built some of the finest ships afloat today. There is no reason why we cannot continue to improve our products, and to take the lead in marine engineering advancement—provided that we have an active, vital shipbuilding industry. It cannot be done in the design office alone, nor can it be done at all unless we build, and build continuously. This is not a suggestion to patronize shipbuilding; it is a flat statement that to keep our Merchant Marine up-to-date, to keep our ship designing and building industry modern and a step ahead of competition, we cannot stop building ships. The experience of the 1920’s verifies this contention. The experience of any other business will tell the same story. America has just finished spending millions trying to make up for this lapse between wars. A machine can be put up “in moth balls”; an industry cannot.
We have touched briefly on the Merchant Marine as an integral part of our national defense, and also on the extreme danger and unnecessary expense incurred by allowing it to run down and then rebuilding in time of emergency. Its value to the nation as a peacetime industry has also been stressed. The closely related business of shipbuilding has also been mentioned. The question now arises as to a remedy for the present situation. At the risk of over-simplifying a vast problem, the following suggestions are offered:
- The nation as a whole—people both in and out of government—must be apprized of the situation in the maritime industries. They should know that the Merchant Marine, whose deeds they proclaim so loudly for its war service, is now rapidly decaying; that the fleet and organization which was built up at such tremendous expense is now facing the scrap pile, both literally and figuratively; and that this condition leaves a serious void in our national defense structure regardless of how many billions are spent on other defense items. The shipping industry, the shipbuilding industry, the Maritime and Naval agencies of the government must become more vocal on this subject so vital to them. Then, with the facts before them, let the American people decide whether they want to build up their Merchant Marine or let it die. Whatever is done, let it be done only after careful consideration, let it be done with our eyes open, let it be done by positive action and not by default.
- There must be a definite governmental maritime policy—a policy agreed upon and subscribed to by all parties and all factions, and adopted on a long term permanent basis. No program is of real value if it is not permanent, as witness the shipbuilding program of 1936 which has now been abandoned short of completion. The policy must be one that will give the Maritime industries normal stability—a policy that will allow shipping men to plan on a long term basis on a par with their foreign competitors and with other American industries; a policy that will offer opportunities for the future sufficient to attract capital for maritime operations and to induce capable, well trained young men to seek a career in this line of business.
- The government regulations affecting the operation and building of ships must be codified and simplified. The agencies concerned with these regulations must be consolidated. Whereas other transportation industries have one main regulatory body with which to deal, shipping has literally dozens, some of which have no up-to-date published rules in circulation. To pick out a few of the more important, one can mention the U. S. Maritime Commission, U. S. Coast Guard, U. S. Public Health Service, U. S. Department of Agriculture, Customs Service, Interstate Commerce Commission, and Civil Aeronautics Board. As examples of how agency rulings affect shipping, the following can be mentioned. Our unsubsidized coastal fleet in which over 60 per cent of our total prewar passenger and cargo tonnage was engaged is now virtually non-existent due to rulings, or lack of rulings, by the Interstate Commerce Commission. Our overseas shippers because of rulings by the Civil Aeronautics Board, are deprived of the advantages of a coordinate sea-air service which their foreign competitors enjoy. While many of this multitude of agencies and regulations are of unquestioned value, the dispersed and confused state of both the authority and the regulations cause the ship operator and builder a vast amount of trouble and expense. A reorganization of the government agencies and a clarification of the regulations would relieve the industry of a great burden, and at the same time would increase the effectiveness of the regulations and simplify their administration. The present set-up works a hardship on the maritime industries and the public alike. It must be rectified.
- Management and labor must both recognize their responsibilities for the future of the American Merchant Marine. In most cases, business lost to their company by their action is lost to America. Loss of business by American shipping companies means loss of jobs by American seamen and shore personnel. The inviolability of a sailing schedule must be recognized. It was the idea of sailing vessels on schedule which, in the days of the packet ships, ushered in the golden age of our maritime history. It would be ironic, indeed, if failure to maintain sailing schedules should now contribute to the downfall of our Merchant Marine by driving business to our foreign competitors. As stated above, Americans who are paid more than their foreign counterparts must produce more in order to compete in world trade. American seamen must therefore be the best in the world. The unfortunate reputation of service on some American ships must be overcome. This does not mean a lowering of personal dignity but rather added self-respect through giving good service and doing the job well. The seamen’s schools, those for stewards in particular, are a start in this direction. Labor and management must make every effort to further this program to keep American ships in service and jobs available for American seamen. We must make people glad and proud to “travel and ship American.”
- The American people as a whole must be made to realize that America is a maritime nation and must accept their part in it. Shipping is not an industry that belongs to the sea coast alone. Foreign cargoes are drawn from and consigned to every state in the union; our seamen come from shore and prairie alike; industries in all sections supply the equipment and materials that go into our ships. Shipping is a national business and must be supported as such.
The above is not a plea for any proposed solution to the Merchant Marine problem, but rather a brief survey of that problem in the hope that its serious consideration may be stimulated. We now have the finest Merchant Marine and shipbuilding industry that this country has had in many decades. It can be the nucleus on which an adequate Merchant Marine can be built at relatively small expense; or, by design or by inaction, it can be allowed to return to its former decadent state from which it will take another miracle of production and another fabulous fortune to revive it. Both national security and sound economy call for action—and action now!
A graduate of Yale University, with postgraduate work at Columbia University School of Engineering, Mr. Holly has been engaged in merchant and naval ship work since 1932. For the past seven years he has been with the Hull Department, Engineering Division of Federal Shipbuilding and Dry Dock Company.