Sea Power: A Commentary: Patterns of American Sea Power, 1945–1956: Their Portents for the Seventies

Introduction

In this article, as in the one published in Naval Review 1969 entitled “The Sea: 1956–1967,” the author has endeavored to present a maritime perspective of the critical period after World War II, generally referred to as the Cold War. He does not claim this presentation to be definitive or objective. Rather than that of a landsman, he has endeavored to take the viewpoint of a seaman on board ship, seeing the world from the ocean. This is done not because it is the only proper way to view the military and economic events of the period. It is just one of the ways, one which heretofore has been neglected.

From the seaman’s standpoint, geography has destined the United States to be a maritime nation, sea-centered as it is in an oceanic world. Its communications with the rest of the world are possible only by crossing the sea, either in ships which move on its surface waters, or in the air above.

By means of the square-rigged ship, Western man was able to break out of his European peninsula, and to dominate the seacoasts of the earth, occupying the Western Hemisphere, Australia, South Africa, and other areas of Africa and Asia. Above all, he created the United States. Three times in this century, Americans in ships have returned to Europe to help preserve it, twice in war and the third time with the restoring economic aid of the Marshall Plan.

Only a bit of honest reflection is needed to discern that the most significant international developments since World War II have been neither political nor military, but economic. The determining facts of the period have not been the existence of nuclear weapons, the march of Communism, Soviet-American polarity, or Arab-Israeli intransigence. They are the recovery and growth of the economies of Western Europe and of Japan, and the exploitation of Middle Eastern oil. All became possible because of the existence of a vibrant and responsive ocean shipping industry that had its origin in the war-built U. S. merchant marine, which after that war provided the means that enabled the world to recover.

The premises here proposed are, therefore, that: first, the Cold War, the label for the continuing struggle between Communist expansion and U. S. containment has been maritime in character, if for no other reason than because three oceans separate North America from Eurasia; second, maritime factors, primarily geography, have dominated the history of the past quarter of a century and; third, the decisive action of that period was the Marshall Plan. The major instrument in effecting it was the merchant ship.

To comprehend the maritime nature of the Cold War, we must picture the revealing geography of Europe, where it originated, and of the Far East, where it was to take on a bloody form. Europe is a land of two great peninsulas, much indented and with numerous offshore islands. Four great bodies of water are associated with this continent, the North, Baltic, Mediterranean and Black seas. The last three are inland seas whose narrow entrances form critical seaways easily controlled by land power.

In the Far East, China, on a small scale map, appears to be a continental land mass like Russia. But China is also a country of great rivers and a long coast line exposed to the forces of sea power, as the coasts of Russia are not. Korea and the continental portion of Southeast Asia are similarly exposed. The Pacific coast of Asia is ringed with islands to a greater extent than is any other continental area. Islands are the handy tools of sea power.

1945–47: The Maritime Roots of the Cold War

It is not the intent here to compose another commentary on the Cold War, but only to point out its maritime features. Many authorities are now agreed that the Cold War had its beginnings within the two years between the Yalta Conference of February 1945 and the pronouncement of the Truman Doctrine in March 1947. By the time of Yalta, the Soviet armies had advanced into East Europe which they have continued to occupy since. Their armed forces after the cessation of hostilities were kept mobilized with well over five million men under arms, supplied with 50,000 tanks and 20,000 airplanes, while a ruined Navy was being rebuilt.

The American people, in the closing year of the war, were too preoccupied with their liberation of Western Europe and their successes in the Pacific to be concerned about the Soviet advances into Eastern Europe. Then with victory came rapid demobilization, and within a few years the U. S. Army was down to about half a million half-trained men spread thinly around the world. The armed services, engaged in an internecine struggle over unification, and a national security policy of “nuclear deterrence,” based on the then atomic monopoly, combined to offer the old isolationism in a new form.

Fortunately, the strategic interests of the United States were not entirely ignored. Bases in the Atlantic, obtained from Britain and Denmark, were still available and on his return from the Yalta Conference, President Roosevelt had obtained commercial and aerial privileges from Arab countries. The Philippines received their promised independence in 1946, but American bases remained. Okinawa became the geographical keystone of a maritime strategy for control of the western Pacific, and the Soviets were excluded from participation in the occupation of Japan. A valiant fight by the Navy’s professional officers, initially led by Secretary of the Navy James Forrestal, saved naval aviation.

On the Soviet side, the Baltic in 1945 came under complete domination of Russia, ending a continuing struggle for this sea which had gone on for over two hundred years. The Soviet victors took possession of the Karelian Isthmus between the Gulf of Finland and Lake Ladoga to give Leningrad a northern land buffer. The Baltic states of Estonia, Latvia, and Lithuania had been incorporated into the USSR in 1940 and remained so after the war. The East Prussian city of Pillau, a year-round ice-free port, became the present base of the Soviet Baltic fleet, under the name of Baltyisk. In addition the Soviets had the use of Polish and East German ports still lower on the Baltic.

The entrance to the Baltic Sea, the Danish Straits, remained in Western hands. Winston Churchill took the necessary steps to keep Russian occupation of the Baltic from extending beyond the point just east of Lübeck, Germany, which had been agreed to at the Quebec Conference of October 1944. When the Nazis, the following spring, gave evidence of finally collapsing, Churchill directed Field Marshall Montgomery, in command of the northern group of armies, to secure Denmark and the Schleswig-Holstein area immediately south of it, including Kiel. On 2 May 1945, British forces reached Wismar, six hours before the Russians. This Baltic city is about 25 miles east of the agreed boundary, to which the Russians were then allowed to advance. What the Soviets would have done had it been their troops which went 25 miles beyond the agreed-on border, which would have put them near Hamburg, must be left to historical conjecture.

In the Black Sea the Soviets were back in control after the Germans abandoned Crimea in July 1944. But neutral Turkey still held the Dardanelles. The Soviets, however, never lost control of their northern coast with its ice-free port of Murmansk. German attacks, in the summer and fall of 1941 against this city from the Finnish port of Petsamo (now the Soviet city of Pechenga), about 50 miles to the west of Murmansk, failed, as did attempts further south to cut the railroad from Murmansk to Leningrad and Moscow. Later in the war many of the over 2,500 ship-loads of American and British supplies delivered to the Soviet Union were to come through this port, with the rest coming through the Persian Gulf, or across the Pacific to Vladivostok. While most arrived too late to help check the German advance, these supplies, especially trucks and tanks, did materially aid the 1944-45 surge of the Russian armies through eastern and central Europe. This surge was an essential cause of the Cold War.

In May 1944, Churchill proposed to Stalin a temporary division of the Balkans into British and Russian spheres of influence, with Britain predominant in Greece. Stalin eventually agreed and in December 1944, British forces were sent to that country.

This British action with regard to Greece in due time led to the Truman Doctrine for the containment of Communism and it brought the return of Americans to Europe to restore the balance of power. The exhaustion of Britain was brutally exposed by the severe winter of 1946-47 which virtually brought the economy of that nation to a halt. In February 1947, the British government informed the United States that its forces would have to be withdrawn from Greece. In a message to Congress on this situation, President Truman announced the containment policy. Economic conditions in France and Italy continued to deteriorate, with the grave possibility of Communist parties coming to power in both countries. An emergency relief appropriation in November 1947 was followed by the European Recovery Program, known as the Marshall Plan. This initiated a four year program of aid in which the American war-built merchant fleet was to match its 1941-45 performance.

Before these measures were adopted, however, the United States with its navy had taken the first steps to check the Soviet expansion. Stalin, immediately after the end of hostilities, began putting diplomatic pressure on Turkey to grant the Soviet Union privileges in the use of the Dardanelles. James Forrestal, Secretary of the Navy, who was among the first Americans to sense Soviet postwar ambitions, wanted to send a task force to the eastern Mediterranean as early as February 1946 to give encouragement to Greece and Turkey, but rapid demobilization and demands in the Pacific prevented this. The battleship Missouri, however, did appear in the Sea of Marmara bearing the body of the Turkish ambassador who had died in Washington. Finally in September, Forrestal obtained authority to establish a permanent Mediterranean naval force which became the Sixth Fleet.

For ten years, this fleet remained unchallenged, making the Mediterranean as much an American lake as the Baltic and Black Seas had become Russian lakes. With the establishment of NATO in April 1948, the maritime control of the North Sea by the combined Atlantic powers was established by treaty. The water flanks in the European Cold War thus became stabilized, and remained so until 1956.

Peacetime Disposal of the U. S. War-built Merchant Fleet

While the maritime problems of the Cold War were being generated in the immediate postwar years, those created by the war itself were having to be faced. Foremost among these was the disposal of the U. S. war-built merchant fleet. Was it to be distributed among the wartime allies or be retained by the United States?

The British had lost the equivalent of 1,190 ten thousand-ton ships during the war, other maritime allies and neutrals together had lost 980, and the Germans, Italians, and Japanese about 1,000 among them. By agreement with Great Britain shortly after entrance into the war, the United States assumed the responsibility for the construction of all merchant ships. Unreplaced war losses had therefore materially reduced the size of the British fleet. The same was true of other European countries which depended on ships for their national existence. The allies would be vehement in opposition if the U. S. were to attempt to keep its entire war-built merchant fleet for active peacetime uses. Moreover, these maritime nations needed income from shipping services to give them the dollar credits to buy our products and to restore a healthy world trade.

On the other hand, maritime interests in the United States would have to be satisfied. Shipping companies, 130 of them, had operated the wartime merchant fleet as agents of the government and they of course desired to continue running these ships in private commercial enterprise. The sea unions wanted to man them and were in a strong position to make their demands felt. With the German and Japanese merchant fleets gone from the seas, there appeared to be sufficient foreign trade to absorb a good sized American segment without hurting the maritime allies.

Finally, experience dictated that a reserve pool of ships, over and above that needed for its commercial activities, would have to be maintained by the United States to assure that the country would not again have to devote a major part of a war effort to a crash merchant shipbuilding program.

One of the few Americans to give searching thought at the time to this vexing problem was Lewis Douglas, the able, forthright former deputy head of the War Shipping Administration which had operated the government merchant fleet in World War II. He expressed his concern in an article entitled “What Shall We Do with the Ships?” in the April 1945 issue of the Atlantic Monthly.

Douglas argued that the most important need in the postwar world was to restore the international market place in which individuals rather than governments competed with their goods and services. Moreover, he pointed out that the American economy derives little nourishment from the carriage of overseas trade and a large U. S. merchant marine is therefore not a necessity in peacetime.

Since private investment would find more profit in other sectors of the economy, such a merchant fleet would have to be subsidized, supported by large sums of the taxpayers’ money, and would thus necessarily involve our government in the vagaries of international trade. This, in turn, would bring us into conflict with other governments, especially those of our World War II maritime allies who could supply shipping services to us more efficiently and cheaply than we could do for ourselves.

Douglas admitted a conflict of purposes, that of constructing an international environment of peace through shipping with that of providing for our own national security should war come again. These purposes, he held, were not irreconcilable. He estimated that 1,000 ships would be sufficient for our domestic requirements and for a sizable portion, about twenty per cent, of our foreign trade. The balance of the war-built tonnage, he held, should be sold or otherwise distributed to our maritime allies on terms so attractive that even Liberty ships could be profitably put to use. Terms should also provide that these ships would carry our overseas trade without prejudice to other nationals and be available at normal charters in the conduct of any war in which the United States might become engaged. In other words, the U. S. would do what Britain had done in both World Wars, charter for war purposes the ships of other nations, whether belligerent or neutral.

Many of Douglas’s views were incorporated into the Merchant Ship Sales Act of 1946 passed in May of that year. This law provided specifically for the sale of part of our war-built fleet and for placing the remainder in reserve. Ships were to be sold to United States citizens first and then to foreigners. The prices of dry cargo vessels were based on the estimated prewar cost of construction in foreign yards less depreciation and certain other adjustments for wartime service. Tankers were priced higher on the grounds that they would be used chiefly in domestic trade and be shielded by our cabotage laws from competition by foreign-built ships. The Act forbade the chartering of government-owned ships to foreigners.

The program was remarkably successful both in laying a basis for an orderly withdrawal of the government from the shipping business and in restoring a reasonable balance among the world’s merchant fleets. Pricing was attractive and prior to the 1948 expiration of its authority to sell for foreign registry, the Maritime Commission disposed of more than 1,100 ships abroad. Thus by the end of 1948, Great Britain’s tonnage was completely restored although her share in the enlarged world fleet dropped to 22 per cent, compared to her 27 per cent in 1939. Norway’s fleet was within ten per cent of its former tonnage, as were those of France and Denmark. Italy’s merchant marine was down to nine per cent of its 1939 size in 1946, but in two years that figure was back to 63 per cent.

The Merchant Marine Sales Act of 1946 really constituted a pre-Marshall Plan which contributed in a large measure to the European Recovery Program when it came. For by then, the one industry in most of the recipient countries which was immediately needed, and which could contribute to their overall success, had already been restored.

The pricing of the war-built ships was also attractive to American buyers. Authority to sell to U. S. citizens was extended to 1950, by which time 823 ships were bought by Americans. By December 1949, U. S. operators owned 1,101 ocean vessels (644 dry cargo, 420 tankers and 37 combination cargo and passenger), representing a tonnage 43 per cent greater than that of the 1939 U. S. fleet. In addition, 111 government-owned vessels were still on charter to private firms.

The Decline of U. S. Domestic Shipping

The Merchant Ship Sales Act of 1946 was enacted before it became evident that the war had caused a major change in the U. S. shipping situation, namely, the sharp decline in water transport of U. S. domestic goods along and between the coasts.

Nations with long coast lines are fortunate because much of their domestic trade can be carried by cheap, water carriage. The ships that carry this trade are, of course, of the oceangoing type and this makes them also suitable for military purposes in wartime. In two world wars, the shipping immediately needed by the U. S. was provided from this source.

The development of the Far West and the opening of the Panama Canal stimulated the intercoastal segment while the acquisition of offshore areas, Hawaii, Alaska, and Puerto Rico, created a new division which has come to be known as noncontiguous shipping. As a result, sixty per cent of the U. S. flag fleet was employed in this domestic trade which was protected from foreign competition by cabotage laws, first enacted in 1817.

Coastal and intercoastal shipping, however, had serious competition from inland transportation, first from the railroads and later from motor trucks. The U. S. railroad network grew and its operations expanded throughout the second half of the nineteenth century, while World War II produced an even more formidable contender with the appearance of the now ubiquitous trailer truck. At the same time, the advantages which the ship had in the carriage of large bulk dry cargo were being lost through increased port and labor charges.

Nevertheless, there were almost 400 ships still in the coastal and intercoastal dry cargo business in 1939. But when these ships were taken over for war purposes, railroads, and later trucks, absorbed this trade. After the war, high cost U. S. flag shipping was in no position to recapture it on a competitive basis. The policy of the Interstate Commerce Commission, which regulates internal transportation, is to not favor one segment of the American transportation industry over another. By 1950, there were no more than 100 ships in the dry cargo intercoastal trade, and by 1953 there were less than 50, carrying materials which land systems could not or would not carry, primarily steel products.

Only one segment of the coastal shipping business remains, the transportation of petroleum by sea from Gulf Coast producing areas to the industrial Northeast. This is because bulk transportation of oil by sea, even in high cost American flag ships, still remains cheaper than its nearest competitor, pipelines. Since foreign flag shipping is prevented by law from engaging in trade between U. S. ports, oil companies and the specialized shipping lines which serve them maintain two fleets, one registered abroad for imports, and another under the U. S. flag for coastal trade.

Another segment of domestic ocean transportation has not declined because it is impossible for land transportation to compete with it. This is the service to Hawaii, Alaska, and Puerto Rico, or what is generally called the noncontiguous trade. Between the wars, tonnage in this trade increased slowly but consistently, and following World War II, in contrast with the other segments, it advanced markedly with the large developments in Hawaii and Puerto Rico and, to a lesser extent in Alaska.

A law of 1920 known as the Jones Act had extended the cabotage laws of 1817 to overseas territories of the United States, thus restricting ocean transportation to such areas as Hawaii, Puerto Rico, and Alaska to ships under the U. S. flag. Since two of these areas are now overseas states, and the Commonwealth of Puerto Rico has undergone marked industrial development, protest over the high cost restrictions of the Jones Act are coming from these areas. Now with the promise of oil and natural gas in Alaska, increasing concern over high-priced domestic flag shipping is also being expressed in the continental states, especially in California, which will need Alaskan petroleum products as its own resources approach exhaustion.

Because there is no other means of servicing the growing economies of the overseas areas, the noncontiguous segment of U. S. domestic shipping cannot be withdrawn for national security purposes. Even if these areas were served by foreign flags, the sea lines of communications to them must be protected. Should Hawaii become isolated owing to hostile submarine or long range aircraft interdiction, that state would soon be on short rations. The danger of food shortage in those islands has been revealed several times since World War II when labor troubles affected the normal supply.

With coastal and intercoastal shipping all but gone, and with the noncontiguous segment not available, U. S. dependence on shipping for the national emergencies which have occured [sic] since 1945 has been on the foreign trade segment of the U. S. merchant marine and on the reserve fleet. However our shipping history indicates that a foreign trade segment cannot subsist, even with heavy subsidy, in the face of the competition of other maritime nations. The reserve fleet, after 25 years, is virtually scrap. The failure of the U. S. Maritime Administration and more significantly of the U. S. Navy to face up for years to the serious merchant marine problem, and the “special interests” which have largely created the problem, has placed in jeopardy the commanding position of the United States upon the seas.

U. S. Maritime Labor Dominates an Industry

A merchant fleet, like a navy, is composed of men as well as ships. The hallmark of an American merchant seaman is his loyalty to his union rather than to his ship. Even at sea his union meetings go on and he looks for leadership to his union’s shipboard representative rather than to the ship’s master.

Hanson Baldwin of the New York Times, in 1946, attributed U. S. maritime troubles to the strength that the sea unions had gained in World War II. He has maintained that view since. Baldwin’s conclusions may not be entirely correct, but there can be no doubt that U. S. maritime labor did so improve its lot, and strengthen its bargaining position during the war, that within three years after the war, it was able to dominate an industry and make management and government do its bidding. It has continued to do so since then.

The evident reasons for this were of course the critical role that the merchant marine had in the war, and the need for men arising from its five-fold expansion. But more specifically it was because of strong-willed leadership, personified by such men as Harry Lundeberg of the Sailors’ Union of the Pacific and Joseph Curran of the National Maritime Union, who were able to keep the wartime expansion within a union framework despite unmistakable attempts to bring it under direct government, or even military, control.

These same leaders were still at their posts after the war when their opposites in management, the men of like character who had built America’s merchant marine and who had guided it to triumph, left for other fields of endeavor. Foremost of these were Admiral Emory S. Land, U. S. Navy (Retired), Chairman of the Maritime Commission and Lewis Douglas, his deputy in the War Shipping Administration (WSA), which was formed in April 1942 under the Commission to operate the wartime merchant fleet. Chairman Land was also head of WSA, but he devoted himself chiefly to shipbuilding. He and Douglas, a onetime Democratic member of Congress, Director of the Budget, and a successful business man, had the entire confidence of President Roosevelt. Douglas’s duties were concerned more with the apportionment of shipping than with its manning. This latter task was largely the responsibility of Captain Edward Macauley, U. S. Navy (Retired), another commissioner, who had engaged in maritime labor relations work after his retirement from the Navy. Douglas resigned in April 1944 and Land in January 1946.

Management within the shipping industry was unable to replace the quality of this leadership. It had been in the shadow since the investigations that preceded the Merchant Marine Act of 1936, and during the war it had virtually lost its identity as shipping companies became merely general agents of WSA, which made all decisions in such matters as allocations, cargoes, routes, and manning. Private shipping management was never able to regain a full measure of control; it has leaned on government and been domineered by labor ever since.

To understand how the maritime unions were able to maintain their identity and gather strength during the war, a short review of their history as far back as World War I is necessary. During that war, shipboard wages had doubled, but the only large union which purported to represent maritime labor, the International Seamen’s Union (ISU), was neither strong nor militant, and the gains of the war years were soon wiped away in the depression, which for shipping began in 1921. Collective bargaining ceased and mariners of all classes became virtually helpless in the face of employers’ ultimatums.

The union leaders of 1945 were determined that this would not happen again, and they were in a far better position than their predecessors a quarter of a century before. The New Deal legislation sponsored by President Roosevelt, beginning in 1933, had given workers the right to organize through representatives of their own choosing and to be free of interference, coercion, or intimidation by employers. Thus in the depths of the depression, trade unionism had a revival.

Within organized maritime labor a much needed revolution also took place. On the Atlantic coast, the International Seamen’s Union was under impotent and self-serving leadership which was doing little for its members. In May 1937, a rebel group, led by Joseph Curran but including a number of Communists, succeeded in breaking away and forming the National Maritime Union (NMU) within the new Congress of Industrial Organizations (CIO). This new union gathered a large dissatisfied segment, almost half of the unlicensed men of all branches on the East and Gulf coasts, and within a short time had agreements with sixty shipping lines operating out of Atlantic ports.

For all practical purposes ISU, which was part of the American Federation of Labor (AFL), was out of business. The AFL withdrew its charter and formed a new organization, the Seafarers’ International Union (SIU) which drew those seamen who considered the NMU leadership too far to the left. The SIU strengthened its position by affiliating with the Sailors’ Union of the Pacific under the vigorous Harry Lundeberg.

The NMU and SIU sought members among unlicensed men in all branches of shipboard life—deck hands, engineers, and stewards—but on the West Coast each branch had its separate union. The licensed people—the officers—were also becoming union minded. Shipping management, by a niggardly and faithless treatment of its officers in the 1920s and early 1930s, had largely lost their loyalty. The Marine Engineers Benevolent Association became the most militant of the licensed unions, controlling as it did the key men in steam and diesel driven ships. The Masters, Mates and Pilots Union also gained strength and acquired competent leadership. The radio officers who had achieved licensed status formed rival unions in the CIO and AFL.

One segment of American maritime labor resisted the big organizing efforts, choosing instead individual company unions. These were the crews, licensed and unlicensed of all branches, that operated tankers of certain oil companies, particularly those of Esso, Tidewater, and Socony. These unions were able to obtain through negotiations all the benefits the militant groups achieved by strikes, mainly through the efforts of John J. Collins, a New York labor consultant.

Such was the maritime union situation when World War II began, promising, but not yet strong. Meanwhile much needed reform was coming to the shipping industry itself through the Merchant Marine Act of 1936. The announced goal of this legislation was the building of a merchant marine, through construction and operating subsidies, suited to the economic and military needs of the country. The new act stated that “a substantial portion” of the nation’s foreign trade should be carried in American flag ships and these ships should be manned in the majority by American citizens. It thereby set the framework by which maritime labor was to add markedly to its bargaining power.

Congress had placed the direction of this program in the hands of a Maritime Commission which, a few years later under Land’s chairmanship, carried into effect the gigantic merchant marine wartime effort. Nothing in the Act, however, provided for manning the fleet created, or for the problems in labor relations that this would involve, such as expansion of manpower, betterment of wages and working conditions, and compensation for the risks of wartime voyages.

With the outbreak of hostilities, measures had to be taken without delay. The Department of Labor and the Maritime Commission jointly called a conference in Washington of shipping and maritime labor representatives to decide wartime policies. The result was a Statement of Principles signed by all involved on 19 December 1941 which, although it never had the force of law or executive order, was carefully observed to the end of hostilities. It was agreed that there would be no strikes or lockouts and the right of collective bargaining would be maintained. The question of war risk payments was eventually resolved by a graded system of extra payments, namely the voyage or area bonus, the port bonus, and the attack bonus. On a broad average, these war risk benefits resulted in doubling the cash earnings of unlicensed men.

All this did not come about without friction. Management as general agents of the War Shipping Administration had in fact become its employees, and so collective bargaining had to be conducted directly between the Commissioners and the union leaders. Here the dynamic, able Admiral Land found a match in tough-fibered Lundeberg and Curran. The common threat to all sea unions was that they might be robbed by executive order of their organizational gains of the past decade. The merchant marine was the only American industry that would come in direct contact with the enemy and there was always the strong possibility of it being militarized. On the other hand, Land in no uncertain terms informed all union heads that the President had directed him to improve shipboard discipline and he intended to do so. To forestall this, the unions put their ne’er-do-wells on the beach.

Land had the single goal of building and operating a merchant marine, whatever its size, that would be needed for military victory. To achieve this he was willing to compromise. The unions were guaranteed their organizational integrity. Prewar contracts with various shipping lines were honored. But the biggest victory for labor was the retention under their control of the hiring halls, with all government merchant marine trainees passing through them.

On the other hand, the master’s supreme authority on board his ship was rigidly defined and unions were forbidden to hold crew meetings. Another significant victory for Land was the reluctant agreement by the unions to give control of discipline, examination, certification, and inspection to the U. S. Coast Guard.

Late in 1945 this moratorium came to an end. The same union leadership was still in control while their treasuries were filled with hundreds of millions of dollars from the dues of the wartime membership. The first postwar task was an organizational drive for that part of maritime labor not yet unionized. The pattern of ocean shipping had changed and there were large nonunion areas ripe for organizing in the growing tanker and bulk carrier segments. Rivalry was intense between NMU and SIU on the East and Gulf coasts where most of the opportunities were offered. The small but lusty SIU in these areas was led by Southern-born Paul Hall, who had risen during the war from oiler. His union achieved substantial results with a vigorous campaign among industrial carriers and in the new tramp shipping which depended largely on government business. The NMU was less successful here, but this union already had the choice of American shipping, the subsidized passenger and cargo liners. On the West Coast, the organizational drive was primarily a matter of consolidating gains in all sectors of the industry.

By the middle of 1946 union leaders were ready to confront management with strikes to get the favorable benefits that would justify their organizations to the members. Their philosophy was that of American organized labor generally—“no contract, no work”—but they were in a commanding position to readily implement this against an industry which was heavily dependent for its existence on the government which, in turn, critically needed the merchant marine for the world power position it had recently attained.

No purpose will be served here in recounting the strikes, slowdowns, and other forms of work stoppages that plagued the shipping industry in the immediate years after the war. The unions’ victories can be better illustrated by listing the annual increases in monthly wages of able seamen during this critical decade.

TABLE: Monthly Base Pay of an Able Seaman U. S. Merchant Marine1942–1952

Year	Monthly Base Pay
1942	$100.00 plus wartime bonuses
1945	$145.00
1946	$172.50
1947	$191.99
1948	$228.00
1949	$228.00
1950	$248.41
1951	$262.89
1952	$302.00

Added to the above (except for the World War II years) were about 14 to 20 hours per week of 150 per cent overtime pay, paid vacations, and bonuses during the Korean War.

The greatest victory for the unions, however, was in job security with the acceptance by the Maritime Commission of the principle of rotary hiring through the retention of the union hiring hall. A hiring hall by definition is a place where workers gather for assignment to jobs. Its principle is that the man who has waited longest has first choice for the next assignment.

The union hiring hall has become the American merchant seaman’s most cherished possession and he remains passionate in its defense. His reasons lie not so much in the distant history of exploitation by shipowners, boarding housekeepers, and crimps of the sailing days, as in the more recent memories of chaotic hiring conditions in the 1920s and 1930s with anti-union hiring halls, “shape-ups” at the pier, or begging of masters and mates for jobs with the attendant uncertainty and fear. In view of the old conditions, many American seaman still feel that the hiring hall is the greatest thing the unions have done for them.

The basic strength of the sea labor movement after 1945 is perhaps best illustrated by its ability to clean its house of Communist elements. As stated above, Curran in forming the NMU had received help from these, and many of his unreasonable militant actions stemmed from his struggle to stay on top. He finally succeeded in ousting the Communist group in 1948, mostly by direct appeal to the membership.

The maritime area had traditionally been concentrated on by Communist “Popular Fronts” both in the United States and abroad. The importance of shipping to a nation’s economy and especially to its international activities was, of course, the reason. In 1946, strong Communist influence existed in every U. S. longshore and sea union. But by 1950, reaction against the Soviets in the United States had set in and the CIO was in a position strong enough to demand that all its affiliated unions get rid of their Communist elements. Those that did not were expelled and eventually dwindled, with the exception of the Pacific section of the International Longshoremen’s and Warehousemen’s Union. Its pragmatic leader, Harry Bridges, changed tactics and followed a less militant policy toward employers who in turn accepted the union under Bridges’ leadership in exchange for peace on the docks and cooperation in accepting labor-saving improvements.

Foreign Labor Conditions

No such wage windfalls, as American seamen succeeded in getting, came to those of other countries. Abroad, inflationary controls preventing this were kept on long after the war. Nevertheless, their countrymen were appreciative of their sacrifices and contributions in World War II and they gave them benefits in other forms. In Great Britain seamen were guaranteed an annual wage and, if they wished, permanent employment. There were no British seamen’s strikes for 55 years, from 1911 to 1966.

In maritime countries sea wages were generally higher than those for similar skills ashore, but neither were comparable to American standards. Moreover there were no laws in any of those countries which limited the major share of employment in the merchant marine to its citizens, as was the case in the United States. Almost one third of the seamen in the British Merchant Navy came from South Asia. The effect of all this was that the operating cost of ships of other nations’ flags was about one third that of U. S. ships, a fact which was to have considerable impact on the European Recovery Program of 1948.

The gains for foreign seamen were rather, in what have become known as fringe benefits such as recognition of unions, contracts, and notable improvements in living conditions on board ship. The irony is that the militancy of the American maritime unions brought more overall gains in the end to seamen of other nations than to their own members. The latters’ high wages only succeeded in destroying jobs as U. S. ships lost their competitive position on the seas. On the other hand, the powers they had won through union action brought respectful deference from owners of foreign flag vessels and improved the lot of seamen everywhere without their having to take similar action. Thus there was no letdown of seagoing discipline in foreign flag ships. Seamen retained their loyalty to the ship, and, in many cases, to the ship’s owner.

Ships for the Marshall Plan

Such was the maritime situation late in April 1947 when George C. Marshall, the new Secretary of State in President Truman’s Cabinet, returned from his first Council of Foreign Ministers, held in Moscow. Marshall was profoundly disturbed by what he had learned of the plight of Western Europe where recovery from World War II had failed to materialize and where economic disintegration seemed certain.

It had also become plain to Marshall in Moscow that the Soviets believed that the economic problems of Western Europe could not be solved without the resources of the eastern and central areas. Hitler had promoted the economic integration of Germany with the East to counter the impact of any future sea blockade, which had been so effective against his country in World War I. Industrial Germany was the keystone of the economy of Western Europe. Coal from Poland, grain from Hungary, and petroleum from Rumania on which the western area had previously depended were now under Russian control. The Soviets were sure they could name the political price at which these would be made available.

The response to this, instead, was a return of the United States to Europe in an economic aid effort that was not only to restore its western segment but also to change the direction of its economic lifeblood. European food and raw materials were to come from overseas. The Americas would largely provide its needed grain, coal, and ores, the Middle East its petroleum.

The threat of an imminent military collapse of Western Europe had drawn the United States across the Atlantic in 1917 and again in 1940-41. This time it was the threat of economic collapse. The United States was to be involved in a major maritime war, but it was to be entirely economic with no warships directly involved. Merchant ships unassisted, though tacitly backed by naval force, would project American power overseas.

The story of the Marshall Plan has been ably told by a number of authors. However none of them relate its success in terms of the existence of the U. S. war-built merchant marine, which was then available for another mammoth job. The part of the Marshall Plan story here related will be primarily that of its ships.

The initial plans for the new oceanic contest were drawn up in the State Department by George F. Kennan and his Policy Planning Committee, and were submitted to Secretary Marshall on 23 May 1947. They called for crash action to stop Europe’s economic decay by reviving its industrial life and by instituting a well planned and financed aid program over a period of four years that would insure complete recovery.

The main ingredient for the crash program would be industrial coal, obtained from European sources or, as turned out to be the case, imported from the United States. The major sources of European coal were Great Britain, the German Ruhr, and Poland. The winter of 1946-47 revealed that, with plenty of coal still in the ground, the period of British greatness as a world supplier of this energy source was over, owing to the bankruptcy of the mining industry. To get sufficient coal from the Ruhr, its miners would have to be fed with a calorie content sufficient for them to do their job, and this meant they would need grain shipped from the United States. Polish coal, of course, was under Soviet control.

The long range program was unique for the Cold War in that its primary emphasis was to be not on checking Communism but on restoring the health and vigor of European society. This society of 270 million people comprised 26 per cent of the earth’s literates. Before the war they had operated 68 per cent of all merchant ships, grew 27 per cent of the world’s cereals, produced 37 per cent of the world’s steel, sold 24 per cent of the world’s exports, and bought 39 per cent of its imports.

To indicate that the Marshall Plan action was not directed against the Soviet Union and its satellites, those nations were invited to join. The Soviets refused, not only for themselves but for the others as well. Czechoslovakia did accept, and in so doing, lost the semi-independence that she had gained after being freed from Nazi rule following World War II.

The Marshall Plan was to be primarily a European cooperative, self-help venture. First steps were taken on 12 July 1947 in Paris at a meeting of representatives of the sixteen participating nations, where the mechanics of a common program were hammered out. This meeting was the first since World War II in which friend, foe, and neutral sat down together. The outcome was the Organization for European Economic Cooperation (OEEC) which had for its aim the achievement of a sound European economy through the economic cooperation of its members.

The structure for the U. S. part of the program was largely the work of the Harriman Committee, a group of 19 distinguished citizens from all sectors of American life, chaired by Secretary of Commerce, Averell Harriman.

The Harriman Committee was the first group connected with the Marshall Plan to give attention to the shipping, without which the effort could not have been undertaken. Since it was to be a self-help affair, the committee assumed that European shipping would do the job. The restored merchant marines of the maritime countries of Western Europe, however, were not considered of sufficient size for this task. Estimates from Europe indicated that in addition to the 1,100 ships already received from the U. S. wartime fleet, 500 more would be needed to get the job done. Of these, 200 would be purchased by the maritime countries, the remainder chartered.

This came as a shock to U. S. shipping interests, which had anticipated relief from a deteriorating situation, with their domestic trade gone and foreign commerce falling off due to the economic stagnation of Europe. Shipping management and labor closed ranks. Their representatives first forced the Harriman Committee to reduce its estimated shipping requirements to figures within the capabilities of the active merchant marines of Europe and the United States. Then, with the help of friends in Congress on the two committees dealing with the merchant marine, most of whom were from shipping and shipbuilding communities, the shipping lobbyists succeeded in stopping the ship transfers. They also obtained an amendment to the European Recovery Program (ERP) bill, directing that fifty per cent of the commodifies procured in the United States be transported abroad on U. S. vessels to the extent that such vessels “are available at world market prices.”

The first step in implementing the Marshall Plan, enacted as the Economic Cooperation Act of 3 April 1948, was the selection of Paul G. Hoffman, president of the Studebaker Company and a member of the Harriman Committee, as administrator of the Economic Cooperation Administration (ECA). His director of transportation was Arthur G. Syran, who, as a colonel had served as Chief of Ocean Transportation in the War Department. He was then serving as Chief of the Division of Water Transportation on General McArthur’s staff, charged with setting up a program for Japan’s maritime rehabilitation. Syran’s record in the War Department as a shipping expediter brought the request for his return from Japan. Until he assumed his duties, these were performed by Captain Grenville Conway, a New York shipping executive who was a member of the Harriman Committee. Conway had been Director of the Atlantic Coast Division of WSA, and later its Deputy Administrator.

Paul Hoffman took office on 9 April 1948. Two weeks later ECA’s first ship, the Liberty freighter John H. Quick, sailed from Galveston, Texas, for Bordeaux, France, with 9,000 tons of wheat. Within another week, six more ships sailed for France, the Netherlands, and Italy carrying food and fuel.

The 50/50 provision of the Economic Cooperation Act soon proved difficult to administer and became the most controversial feature in an otherwise smooth running operation. The high wages of American maritime labor resulted in the cost of U. S. flag tramp shipping being three to five times greater than that for vessels under other flags and this was reflected in freight rates. The recipient countries were dissatisfied at being thus deprived of proportionate aid for other areas of their economy. Transportation charges were absorbing 12 per cent of EGA funds and, in the case of France and Italy, this figure reached 20 per cent. To reduce these, foreign agencies making purchases and arranging for shipping, in many cases ignored the 50/50 provision. Compliance could only be enforced by ECA through spot checks and by a study of complaints.

Freight rates for U. S. ships showed no tendency to drop, despite the stipulation in the law that the use of these vessels depended on their being offered at world rates. This disturbed Hoffman. He admitted that U. S. shipping might need subsidizing, but he claimed that this should be done directly and not at ECA’s expense. Thus he stated, “I am not going to take the taxpayers’ money to subsidize American tramp shipping in a world shipping situation where a lot of it is going out of business anyway.” He pointed out that ERP would prove a weak reed for U. S. shipping to lean on as its very success promised its end.

On the other hand, interests favorable to the U. S. merchant marine, including the Maritime Commission, charged that foreign shipping companies were purposely depressing rates, giving one example of $6.85 per ton being offered for transport of coal, whereas $9.00 would have to be charged for even a foreign ship to make a reasonable profit.

Hoffman, unable to get U. S. freight rates down, took a drastic step in December 1948 by announcing that beginning with the new year he would cease using American flag ships. The storm of protest that this brought on forced him to delay putting his order into effect until after Congress met. One of the strong protesters was Democratic Representative Schuyler Otis Bland from Newport News, Virginia, who would be Chairman of the Merchant Marine and Fisheries Committee in the new Democratic controlled Congress of 1949.

In Europe where the 50/50 clause had been criticized as an intrusion of American protectionism at the expense of recovery, Hoffman’s action was hailed, especially as the answer to Communist propaganda against ERP to the effect that the whole program was only a means of exploiting Europe for American benefit.

On the other hand, the American shipping industry said it failed to see why it should be treated differently from any other type of American business endeavoring to supply products and services for ECA and where American standards of living were given full recognition. Here was the crux of the whole problem. Shipping could never just be an American business, for it is by nature international. The controversy became so heated at this time that it moved from the maritime pages to more conspicuous areas in the daily press.

Hoffman’s efforts were devoid of results; in fact, they produced a reaction. The Bland-Magnuson Amendment to the 1949 ECA bill made the 50/50 clause more positive by removing the discretionary feature and by stipulating that market rates were to be those “reasonable for U. S. flag ships.” This meant that for any Marshall Plan cargoes above the 50 per cent carried in foreign vessels, the shipping agency would have to return the cost difference.

Syran made a special trip to Europe to explain these facts to shipping interests and OEEC officials there who, nonetheless, asserted that its member nations had lived up to the 50/50 rule and were not depressing rates. In October, ECA refused to pay $10 to $15 million in ocean freight costs for the shipment of Marshall Plan material to 8 of 16 participating countries. By December 1949 the refunds demanded were $30 million for two quarters, and ECA officials were becoming worried about the effect this might have on Congress considering the 1950 foreign aid bill.

Despite such shipping difficulties, the economic recovery of Europe proceeded at an extraordinary rate. Industrial production, seven per cent below the 1938 index when the Marshall Plan started, was almost twenty per cent above it when the Korean War began in mid-1950, and this figure continued to climb to almost forty per cent above the index for 1938 at the end of the four-year period. Agricultural production, which had gone down more than industrial production during the war years, and was slower to recover, nevertheless made marked progress. This healthy situation was clearly indicated in the shift, by 1950, in the character of the cargoes, as the earlier predominant shipments of coal and grain from the United States were replaced by other basic materials, and by machinery and equipment.

On 10 November 1950, the Report to the President on Foreign Economic Policies was published by Gordon Gray, former Secretary of the Army. Its purpose was to chart a course in the field of foreign policies and programs that would “help build a structure of international economic relationship which would permit each country, through the free flow of goods and capital, to achieve sound financial growth without the necessity for continued financial aid.”

Gray’s work was overtaken by the Korean War, and the report therefore had little impact. It was notable however in confirming the previous views of Lewis Douglas and Paul Hoffman.

Gray in a preliminary report in August had made some drastic recommendations with regard to shipping, such as: (1) repeal of laws stretching back to the 1817 cabotage law which forbade foreign shipping in coastal, intercoastal and non-contiguous U. S. trade; (2) gradual reduction of operating subsidies; and (3) transfer of one hundred cargo ships to foreign registries. These provisions were dropped from the final report but, despite pressure from shipping interests, Gray retained the recommendations calling for cancellation of the requirement that fifty per cent of Marshall Plan aid and all of other government financed cargoes be carried in U. S. flag ships. Gray held that such cargo preference was a concealed subsidy and thus not subject to scrutiny and inspection as was direct subsidy; that the tonnage and type of shipping kept in operation by such preference had no relation to security requirements; that it relieved the pressure on ship operators to compete in services and rates; and finally, that it tended to encourage similar flag discrimination in other maritime countries.

At the time Gordon Gray submitted his final report, the United States’ fortunes in the five-month-old Korean War had gone from bad to good and were about to go bad again. Cargoes were now seeking U. S. ships instead of the reverse. Cargo preference became buried under an avalanche of unforeseen events. But it was not a dead issue.

Korean War: The Strategic Situation in 1950

Victory in World War II, and the increased international commitments that came with it, forced changes in the U. S. position in world affairs, whether Americans wanted this or not. Our foreign policy as expressed by the Truman Doctrine became one of containing the Soviet Union while reviving the economic and military strengths of the free world. Control of the seas and a peripheral or maritime strategy offered the means of sustaining such a policy and the roles of the three armed services should have been changed accordingly. They were not. The reasons need not be reviewed here. They are all documented in the extensive literature on the armed forces unification conflict of 1947-1949.

The Truman Doctrine, first defined in February 1947, called for halting Communism or Soviet imperial expansion, whichever term is preferred. From the viewpoint of 1970, it now appears that Soviet political expansion into Eastern Europe through military occupation had expended itself by 1950, although this fact was recognized by very few in the West at the time.

The nuclear arms situation had also become stabilized in 1949 when the Soviet Union exploded its first atomic bomb. Nuclear deterrence then became nuclear stalemate, which has been the condition since.

In the Far East, however, the situation was fraught with danger because the West, still reeling from the Soviet postwar successes in eastern Europe, was inclined to yield in Asia. Instead of holding, as we had done in Europe, we withdrew to an imaginary line drawn through Japan, Okinawa, and the Philippines. It was further announced in Washington that we would conduct our policy of defense and containment along that line. Whatever was meant by this, it was understood in Russia and no doubt in China and North Korea, as our abandonment of continental Asia. U. S. action seemed to bear this out. We withdrew our Marines from North China, and our army from South Korea. Meanwhile, and unnecessarily, the last place the Chinese Nationalists relinquished in their retreat to Formosa was Hainan, the large island on the South China coast that forms the eastern shore of the Gulf of Tonkin.

Continental minded Americans, therefore, allowed China to go by default because there appeared no way of saving this area except at the risk of a land war in Asia. But there was another way. Our occupation forces, supported by the Navy, could have stayed on the coast of China instead of retreating behind the water barrier.*

Unchallenged at sea, the U. S. Navy could certainly have done this as they would soon have occasion to demonstrate at Hungnam, Korea. In any case, Americans are no longer in North China, but the British are still ‘n Hong Kong. Had we been willing to support the Nationalist Chinese in their defense of the major rivers and ports on the mainland, Taiwan might now be the center of a sea state ranging from Shanghai to Hainan. Had we chosen to remain in North China, especially had we held Tsingtao, a deep water port, and Chefoo, once the summer base of the U. S. Asiatic fleet, there might have been no Chinese intervention in the Korean War.

The beautiful city of Tsingtao might now be a northern Hong Kong, perhaps a West Berlin of the Far East. Had we persuaded the Chinese Nationalists to hold Hainan and had we supported them with naval forces, there probably would be no Vietnam dilemma today.

Instead, it was almost immediately discovered that the strategy of withdrawal had deprived the United States of almost all its freedom of action, both military and political. Within a year we were back in continental Asia but with only a foothold in the peninsula of Korea and at what bloody cost!

The first task of a navy in an overseas war, such as that in Korea, is to gain and maintain control of the seas. The second is to use that control.

The U. S. Navy had accomplished the first task five years before, in World War II. Its control of the sea was never challenged by Communist forces although this possibility was ever present with U. S. ships operating a few hundred miles from the Soviet submarine base at Vladivostok, and within range of the numerous air bases in Siberia.

The second task in an overseas war is a double one. Land forces, ground and air, have to be positioned on the enemy coasts and thereafter supported from overseas. And the enemy should be denied the sea for support of their own forces by blockade. The first was done well in the Korean War, the second not at all. There were additional functions which the navy did perform in Korea, such as fire support and bombing, but these are not relevant to the main issues, and are bypassed here.

Shipping and the Korean War

The invasion of South Korea by the North Korean army began on the morning of 25 June 1950. Within hours, President Truman ordered U. S. sea and air forces to give troops of the Republic of Korea cover and support. This was not enough. By 29 June, the North Koreans were in the capital city of Seoul and the next day General Douglas MacArthur in Japan was given authority to use the forces under his command to resist the invasion. These, however, were all but driven from the peninsula and the situation was saved only by the flanking amphibious operation at Inchon in September. The drive to the Yalu River followed, the Chinese Communists entered the war in November and operations took another fateful turn, causing the President, on 16 December 1950, to declare a national emergency.

The United Nations gave its blessing to the employment of armed force in Korea to resist aggression. Operations there were to last over three years with over one half million men engaged on the United Nations side. But despite its size and extent, this military action never became a declared war in terms of international law. This omission was to have a deep impact on the future Cold War employment of naval power by the U. S.

The outbreak of the Korean War brought with it an immediate heavy demand for shipping. In the European Recovery Program, the burden had been divided between U. S. ships and those of European maritime nations. The support of the Korean effort, however, fell entirely on U. S. shipping. At the opening of the Korean hostilities, the American merchant marine, although its ebb had begun to set in, was still the greatest the world had known. It alone among the defense services was ready for the demands again placed upon it.

A few weeks after hostilities began, San Francisco Bay was crowded with ships awaiting troops and cargo. In September 1950, 72 of the 120 ships used to transport troops for the Inchon operation were manned by civilians, either American or Japanese. In the dark days before Christmas 1950, after the Chinese had entered the war, the X Corps including the 1st Marine Division, and the Army’s 7th Infantry Division had to be evacuated by sea from Hungnam on Korea’s east coast. In this amphibious “retrograde movement,” 105,000 troops, 91,000 Korean refugees, 17,500 vehicles and 350,000 tons of stores were loaded out on 193 ships, three quarters of them civilian manned.

To support 500,000 men in Korea, a daily supply of 20,000 tons of dry cargo and 125,000 barrels of petroleum products (the load equivalent of two cargo ships and one tanker) had to be transported across 5,000 miles of ocean by a chain of about 375 ships. Sixty other MSTS vessels were needed in the Western Pacific for troop movements and to carry support from Japan.

The Military Sea Transportation Service (MSTS) had been established on 1 October 1949 under command of Vice Admiral William M. Callaghan with responsibility for the seaborne logistic support of the three armed services. For its first nine months, the new service concentrated on organization, taking over vessels from the Army and the smaller Naval Transportation Service. This task was hardly completed when the Korean War erupted, MSTS Western Pacific command, on the day of its activation (1 July 1950) found itself confronted with a major emergency. In this war MSTS did a remarkable job. Fortunately, it had the means to do so. For a third time in a decade the war-built U. S. merchant marine had the task of projecting the nation’s power, military and economic, across the seas.

At the beginning of the Korean hostilities, MSTS had 174 vessels of its own and six on time charter. Three months later it had 215 of its own and 230 time chartered. With these, plus berth liners, and ships on voyage charter from the Maritime Commission, it supported all U. S. armed forces the world over, with Korea and the Far East requiring sixty per cent of that effort.

Korean War shipping shortages brought an end for a time to the controversy over the 50/50 cargo preference ratio. By January 1951, these shortages were becoming so acute that ECA began requesting ships be withdrawn from the reserve fleet as a means of controlling rates, which, according to Transportation Director Syran, had gone wild. At this time the Maritime Commission had its strongest administrator of the postwar period, Admiral Edward L. Cochrane, who had been Chief of the Bureau of Ships in World War II. Since the President had declared a national emergency, Cochrane was able to get another War Shipping Administration established by Executive Order on 21 February 1951, with the new title of National Shipping Authority.

Victory ships were all withdrawn from the reserve fleet for use of MSTS while Liberties were allotted for ECA cargoes. The ships were assigned as in World War II on bareboat charter to steamship companies who manned, provisioned, and otherwise operated them on time charter to MSTS or ECA. By the end of December 1951, a total of 469 Liberty ships had been withdrawn from the reserve. With their reciprocating engines and simple design, vessels of this type could be placed in service within a few days.

In addition to its Korean and ECA commitments, the American merchant marine was given the task of carrying two million tons of grain to India to stave off a famine there, and one million tons of it had to go without delay.

As a result of such demands, the U. S. privately operated merchant fleet at the close of 1951 numbered almost 2,000 vessels, a figure not reached in World War II until 1944. Of these, 1,300 were privately owned. Of the others, 210 were bareboat chartered from the Maritime Commission and 469 were in the NSA fleet.

This doubling of the active fleet in 18 months caused manning problems which began to appear as early as February 1951. By October, shortages of licensed engineers, radio operators, and able seamen were acute enough to delay some vessels. Ship operators blamed the unions for not having an adequate supply of men, not exercising sufficient effort to induce men to return to sea, and even fostering shortage as a means of obtaining higher pay. This of course the unions vigorously denied. In December 1951, 55 ships were tied up, some as long as two weeks. The Coast Guard, under national emergency provisions, resorted to granting waivers for the employment of foreign seamen as had been done in World War II.

The Korean War was to change the whole aspect of U. S. foreign aid from “economic cooperation” to “military security,” and this was reflected in the change in titles and organizational structure. With a war in progress and military needs in arrears, economic objectives receded in favor of a strong shift of emphasis to rearmament. Congress established the Mutual Security Administration (MSA) for the distribution of foreign aid with the stipulation that the new organization absorb ECA by 1 July 1951.

Unlike ECA, which was an independent agency run by civilians wholly outside of government departments, MSA was a multi-departmental affair supposedly directed by the State Department, but largely run by the Department of Defense, which disbursed the money. It can be judged now to have been far less successful than the Marshall Plan. Unlike the latter, we see in retrospect that it was not so critically needed.

Admiral Forrest Sherman: A Naval Officer for His Time

Sea power or command of the sea is supposed, in a maritime war, to guarantee to the nation having it the use of the sea lanes and the denial of them to the enemy. It has already been shown that the seas were used effectively for the support of military forces in Korea. The denial of the seas’ use to the enemy, however, was another story, a sad one which is dramatically told in one of the most significant documents in United States history since 1945, the Joint Senate Committee’s MacArthur Hearings, on the military situation in the Far East, 3 May-27 June 1951.

This proved a salutary lesson on sea power and on one of sea power’s major tools—blockade. The lesson was given primarily by the Chief of Naval Operations, Admiral Forrest Sherman, but he was ably assisted in it by three generals, MacArthur himself, Albert C. Wedemeyer, and Clare Chennault.

The lessons were after the fact, for they had not been applied. The rights of blockade and of visit and search of merchant ships, permitted by international law to a belligerent in war, were never exercised in the Korean War against China, on the ground that there had been no formal declaration of war between the two nations. A precedent was thereby established for the Cold War, which was to plague the United States in the Cuban crisis of October 1962, and again in the Vietnam War.

In both cases, naval blockade was the proper instrument to use. In the Cuban crisis it was attempted with trepidation. In Vietnam, bombing was employed in its stead. As a result, the powerful U. S. Navy, in the undeclared war situations that have characterized the last two decades, has been unable to deny the use of the seas to an enemy. In this Cold War period, the concept of freedom of the seas has triumphed over that of command of the seas.

A half century ago when Britain was in her sea power trial of World War I, her foremost maritime thinker, Sir Julian Corbett, succinctly stated: “Freedom of the seas cannot exist so long as naval warfare is allowed to exist, since without substantial permission to command the seas, navies, except as mere adjuncts to armies, cease to have meaning.”

Admiral Sherman gave his testimony at the MacArthur Hearings on 30 and 31 May 1951. In his opening statement he outlined the nature of blockade, contraband, the right of visit and search, and the essential differences between them under maritime international law. He stressed how Communist China, because of her geography, was vulnerable to an “effective” blockade. Over 2,500 foreign flag ships entered her ports annually for, although her economy was mainly rural, its urban and military segments were then largely dependent on overseas supply and on coastal trade.

An “effective” blockade, Sherman claimed, would force China to depend entirely on the Soviet Union for logistic support in the war, thereby placing a strain on the Russian economy. Such support would have to come over the Trans-Siberian railroad, the capacity of which was only 17,000 tons a day, or less than two shiploads.

Sherman took pains to indicate that while it appeared blockade could be evaded by ships merely by sailing to ports of neutral areas bordering on China, such as Soviet-held Dairen, and also Hong Kong, maritime international law provided that the final destination of cargoes determined whether they were neutral in character. This was according to the doctrine of continuous voyage first adopted during the American Civil War and used effectively by the British in World War I to prevent goods reaching Germany through the ports of Holland and Denmark.

Sherman did not advocate a unilateral blockade by the United States against China since there had been no declaration of war between the two nations. The Soviets, he pointed out, might therefore not respect it and conceivably might oppose it by force. But he strongly advocated a naval blockade by the United Nations which by its charter could institute it against an aggressor without declaration of war. Such a blockade would not only reduce the war potential of Communist China but also demonstrate to the Chinese and Asian peoples the power of the force against Communism, especially sea power, which the mainland Chinese could do little to thwart.

When questioned by Committee members whether the Soviet Union would acquiesce to such a blockade, he reminded the Senators that a United Nations naval blockade against North Korea had been in effect since 1 July 1950 and that the Russians had respected it. But Sherman readily admitted that since power is the final arbiter of international law, any blockade is fraught with problems if objected to by a neutral willing to use power. Nevertheless, he never mentioned that most important institution of the Civil War blockade, the prize courts. This was unfortunate because he did not correct the misconception about the laws of war at sea, expressed several times by Senator Wayne Morse of Oregon, that blockade meant the sinking of neutral ships. Such ships are not in fact sunk by belligerent naval forces for performing the unneutral service of carrying contraband goods; they are taken into custody, brought into port, and condemned by prize courts. The actions of naval officers are thereby reviewed by civilian judges. Nothing parallels this in the laws of war on land.

The State Department, as indicated by the testimony of Secretary of State Dean Acheson, was in favor of economic sanctions only. Most members of the United Nations had agreed to such action after a resolution of the General Assembly branding Communist China as an aggressor. However this resolution was not passed until 18 May 1951, over six months after China entered the war.

There were indications that Great Britain, once the most frequent user of blockade, was now becoming openly opposed to its use or to any form of restriction on maritime trade. Not only was a great deal of trade moving to China through Hong Kong, but on 9 April 1951, Sir Gladwyn Jebb, chief British representative to the United Nations, during a talk in San Francisco, warned that blockade against China could lead to unlimited war and imposing economic sanctions might be double-edged or merely useless.

Generals MacArthur and Wedemeyer went far beyond Sherman’s position and advocated a unilateral blockade of mainland China by the United States. Wedemeyer stated that he was for a U. S. blockade only after every effort to get a U. N. blockade had been exhausted, but he felt that sufficient effort to get such action had not been made. Whether Admiral Sherman felt himself restrained in expressing his real views by his official position cannot be determined because of his untimely death on 21 July 1951 in Naples.**

Conclusions: To 1956—and 1970

From the viewpoint of 1970, the Korean War now appears to have been the crucial point in the maritime history of the United States during the past quarter century. Though the ebb of the U. S. merchant marine had already set in following the end of World War II, by comparison with what was yet to come, it was still high tide. The commercial sea service has since declined almost to extinction primarily because it was not suited to the economic reality of the world after 1945. And in the decision not to blockade or assume other rights of a belligerent granted by international law in the undeclared Korean War against Communist China, the United States set a precedent that has largely abrogated Mahan’s concept of control of the sea. The powerful U. S. Navy has thereby been relegated to being an adjunct of the Army in an overseas war and partner with the Air Force in a nuclear strategy.

The meaningful history of the past two decades, as pointed out in an early paragraph, has been essentially economic. The nuclear explosive has largely nullified military action as a political force in Clausewitz’s sense. The dominant positive force that has shaped the world of the past two decades has been economic, primarily the transport by sea of petroleum, the world’s chief source of energy. The instrument for accomplishing this has been the tanker which, after World War II, superseded the dry cargo freighter as the foremost merchant ship type.

The political leaders and most of the shipping community in the two major maritime nations, Great Britain and the United States, missed the significance of this change. The conservative British replaced ships lost in World War II primarily with vessels of the same conventional dry cargo type. In the United States, shipping men and members of maritime committees in Congress were chained mentally and legally to the anachronistic Merchant Marine Act of 1936. What ships were constructed were suited to the world of 1936, ages away from the world of today.

The change at sea was not missed by those entrepreneurs of the oceans, the Greeks. During the Marshall Plan period when Middle East oil was required for Europe, they shifted from the Liberty ships acquired after 1945 to tankers financed by preconstruction charters from oil companies willing to pass the petroleum transport chores to them. This was the basis of the Niarchos and Onassis fortunes.

The Norwegians, forced to make their living from the sea, also divined the maritime future. So did a few American shipping men, notably publicity-shy Daniel K. Ludwig, who had been in the tanker business since 1925. Late in August 1951, only a month after the peace treaty with Japan had been signed, it was reported in the press that National Bulk Carriers of New York, which he owned and operated, had leased the former naval shipyard in Kure, Japan for building supertankers. That yard had a 150,000 ton capacity dry dock, constructed in 1912. In it, the Yamato, one of the world’s largest warships, had been built.

Ludwig also discerned the future needs of the United States for an overseas supply of iron ore because of exhaustion of the high grade ore in the Mesabi Range of Minnesota. He helped develop sources in Venezuela near the Orinoco River, and among his early ships built in Japan was a combination oil-ore carrier, an innovation that materially reduced time in ballast, the bane of the tanker business.

Japan before World War II had ranked third among the shipping nations, after Great Britain and the United States. Japanese shipyards, for reasons still undisclosed, had been spared the relentless bombing by the U. S. Air Force although adjacent areas were devastated up to the boundaries of the yards. The industry after the war was restricted, by orders of General Douglas MacArthur, to building only 150,000 tons a year but the peace treaty ended this ban. Ludwig introduced assembly lines and prefabrication methods; other companies followed suit; and Japan’s shipbuilding output went from 150,000 tons in 1948 to 2.3 million in 1962 and to 7.5 million in 1967. That was 47.5 per cent of the world’s shipbuilding in 1967. Of the 4.5 million tons built for export that year, 2.3 million was for Liberian registry and 1.1 million for Norwegian.

The rise of the Liberian flag-of-convenience fleet was equally phenomenal. In 1948 it did not exist; in 1956 over six million tons was registered under that country’s flag, over three quarters of it in tankers. On 1 January 1969, that figure had reached 27 million, almost fifteen per cent of the world’s tonnage. Of this, 45 per cent was American owned, 85 per cent American financed through preconstruction charters from oil and steel companies. Finances were provided by such institutions as the Chase National Bank, Chemical Bank of Delaware and the Metropolitan Life Insurance Company. Nothing, perhaps, better illustrates the international character of the present shipping business or the part Americans have played in it.

A flag of convenience is that of a non-maritime country in which shipowners of other nationalities can register their vessels to avoid taxes, high labor costs, and the restrictive laws of their own country. These are the chief reasons for the use of such a flag by American firms, primarily oil and steel companies and the owners of ships that serve them. For the Greek shipowners, it also offers a means to obtain U. S. financing.

The flag of convenience is an American created institution and the two nations that offer it extensively, Panama and Liberia, have close political connections with the United States. Panamanian registry, however, has become less popular than before because of unfavorable publicity arising out of illegal transfers to that flag of some war-built shipping, to extensive use of ships under the Panamanian flag in trade with Communist China during the Korean War, and lately to unsettled conditions within the country itself. The Liberian flag of convenience evolved from the efforts after 1945 of a group of American businessmen, led by Edward R. Stettinius, the former Secretary of State, to develop means of exporting iron ore from Liberia, using ships of that country to transport it.

The flag of convenience practice makes evident the fact that the United States has two merchant marines, one subsidized under the American flag, the other privately owned and primarily under the Liberian flag. The first has been declining since the Korean war because, as a result of restrictive laws and high costs, its ships, unsuited to the demands of the second half of the twentieth century, were not replaced by others that were suited. The second American merchant marine is one of the largest and most modern on the seas. The question for Americans to decide is whether to revive the first or accept the second. The Nixon program of 1970, calling for 300 ships built over a period of ten years, merely postpones that decision. These 300 vessels will not suffice both to insure the importation of raw materials that the economy now requires and to assure a significant economic presence of the United States around the world.***

The American merchant marine problem can be solved if honestly and objectively confronted.

The naval problem is far more perplexing because proper and effective usage of naval force as a maritime instrument in the non-war Cold War has yet to be satisfactorily determined. The navy’s nuclear deterrent function is strikingly evident and so is its support potential to military operations on shore. But its Cold War maritime efficacy in the Mahan concept of control of the seas, especially in denying the use of these seas to an enemy, is difficult to see. This is perhaps no better illustrated than in a passage by Rear Admiral Edward Wegener of the Federal German Navy in one of the most perceptive piece of naval writing since World War II.****

As translated, the passage reads: “We have seen how President Johnson shrank from exploiting the lone presence of American forces in the Gulf of Tonkin in a naval blockade. Under the eyes of the American fleet, innumerable East bloc vessels were allowed for years to supply the North Vietnamese with war materials month after month. Johnson chose massive bombing of North Vietnam, an action which is as little supported by international law as is a naval blockade during peacetime. Finally he let the facilities of the North Vietnamese harbors be attacked. But the ships he left untouched. Not once did he care to order the mine blockade suggested by the U. S. Navy. He held to the international naval law. This too was naturally a politically motivated decision. History will judge whether it was a wise one, or whether it was a serious, perhaps the crucial, mistake of the whole Vietnam war.”

President Johnson’s dilemma had its roots in the precedent that was made in the undeclared Korean war not to blockade Communist China or assume the other rights that international law affords a belligerent.

In the face of this, the United States Navy is now confronted with a rise of maritime power by the Soviet Union both in the form of large modern naval forces and a growing merchant marine. The year 1956 was selected as a terminal point for this analysis not only because it marked the first closing of the Suez Canal but more importantly because during that year a major change took place in the foreign policy of the Soviet Union, namely its turn to the sea.

How should American sea power, in its present form and in the world situation of 1970, react to this pregnant new maritime state of affairs?

This is the question to which U. S. naval officers now must search their souls for an answer.

[signed] John D. Hayes