To Be a Modern Maritime Power

Ask a naval professional which nation is the greatest sea power in the world today. By most common definitions of the term, the answer is the United States. With a presence on every ocean, the most capable surface warships, naval aviation, Marine Corps, and submarine force, it is hard to argue that any other navy even comes close in terms of naval power. Yet, does this equate to the Mahanian definition of sea power?   

Ask the same naval professional these questions:

• What three flags fly from 40 percent, by tonnage, of the world’s commercial fleet? 
• Which three nations built 90 percent of the world’s ships?
• How much of the world’s container trade is controlled by the three mega-alliances?  
• Who are the five largest operators of tanker tonnage? 
• Where are the three largest passenger ship operators located? 

Coming in at Number 22

The answers to the five questions above demonstrate the scope of globalization of the world’s oceans.  

Flag. The top three flags by tonnage may not seem to be major players, but Panama, the Marshall Islands, and Liberia account for more than 40 percent of the world’s total deadweight tonnage. These states are known as flags of convenience or open registries. Today, the United States is 22nd in the world, based on ships of more than 100 gross tons.¹ More alarming for the United States should be the fact Hong Kong is fourth and China is seventh. Combined, their fleets place them second, behind only Panama.

The reason for open registries has to do with cost of operation. Issues such as insurance, repairs, crew costs, and management are cheaper outside developed nations. While the United States may bemoan its decline from its peak position after World War II, U.S. decisions have helped put those other three nations at the top. The Panama registry was used in the run-up to World War II to circumvent U.S. neutrality laws and deliver vital aid—in particular, 100-octane fuel—to the British. The Liberian registry came into being during the early Cold War to provide the U.S.-allied nation of Liberia an economic basis. As that country descended into civil war, the Marshall Islands was envisioned as a good alternative.² 

Construction. The three nations that built 90.5 percent of the world’s ships are all in East Asia: the People’s Republic of China, the Republic of Korea, and Japan, in that order.³ China constructs a third of the world’s ships, hence the People’s Liberation Army Navy’s (PLAN’s) ability to turn out warships in such an efficient manner. The situation will not improve in the future. Early in 2019, Hyundai Heavy Industries in Korea, the world’s largest shipbuilding group, announced plans to merge with Daewoo to control 20 percent of all shipbuilding. Then in July of this year, China’s two largest shipyards—China Shipbuilding Industry Corporation and China State Shipbuilding Corporation—announced their merger to counter the Koreans.⁴

The current situation in U.S. shipyards is serious.⁵ There are many reasons for the loss of a U.S. shipbuilding base. During the Reagan administration’s push to construct the 600-ship Navy, many shipyards chose to focus on government rather than commercial contracts. When the defense buildup slowed after the Cold War, and construction and operational subsidies under the Merchant Marine Act of 1936 expired, the U.S. shipbuilding base contracted.

Alliances. The term mega-alliances refers to the top nine container firms in the world, organized into three coalitions. These entities have an 80 percent share of the global market, and there is not one U.S. firm in the group.⁶ The 2M alliance is dominated by the two largest firms, Maersk and Mediterranean Shipping Company (MSC). The Ocean Alliance, in second place, includes CMA CGM, Evergreen, and China COSCO Shipping. The makeup of this alliance is the most interesting as it includes French, Chinese, Taiwanese, and Hong Kong–based firms. The third alliance, aptly named “The Alliance,” includes four firms: Hapag Lloyd, Yang Ming, United Arab Shipping, and the newly consolidated Japanese Ocean Network Express (ONE). These mega-alliances represent a cross section of Asian, European, and Middle Eastern shipping companies and reflect the reality of the world shipping market: It is growing and almost exclusively outside U.S. control or oversight.

Of the top 20 container ports in the world, only number 17—Los Angeles/Long Beach—is in the United States. The rest are in China (9), Malaysia (2), Singapore, Korea, Taiwan, the UAE, the Netherlands, Belgium, Thailand, and Germany.⁷ The once dominant U.S. container lines—United States Lines, American President Lines, and Sea-Land—have either declared bankruptcy or been bought out by larger international firms.  

Tanker Tonnage. For decades, the tanker and oil industry was dominated by the Seven Sisters: U.S.-owned Texaco, Gulf Oil, Chevron, Exxon, and Mobil; British Petroleum; and Royal Dutch Shell. These western firms oversaw not only exploration, drilling, and refining, but also transportation. Into the 1980s, they controlled more than half the world’s tanker fleet. Then a series of accidents and spills involving ships such as the Amoco Cadiz and Exxon Valdez exposed these firms to huge financial liabilities. Many divested themselves of their tanker fleets, and what emerged were independent shipping companies.  

Today, the world’s tankers are owned by multiple companies, but consolidation is once more on the scene. The top five, from smallest to largest, are Mitsui-OSK (Japan), China Merchants Energy Shipping (China), Bahri (Saudi Arabia), Euronav (Belgium), and COSCO Shipping Energy Transportation (China). Not on the list but of importance is NITC (Iran) at number six, and Russia’s Sovcomflot Group at number 11.⁸  

Passenger Ships. If the average American has any exposure to the sea, it probably is on board a cruise ship of one of the three firms that transport 74.5 percent of the 26 million passengers annually. These three companies—Carnival, Royal Caribbean Cruise Line (RCL), and Norwegian Cruise Line (NCL)—together possess 171 ships.⁹ In their entire combined fleet, only one ship, NCL’s Pride of America, is U.S.-built, -crewed, and -flagged.  

Even with headquarters located within 20 miles of each other in southern Florida, to avoid U.S. income taxes, all three companies are incorporated outside the country: NCL in Bermuda, Carnival in Panama, and RCL in Liberia.   

While cruise ships and liners may not seem relevant to U.S. sea power, in the past two world wars, interned and domestic liners and ships, along with those of allies, transported U.S. forces overseas. At the start of the Vietnam War, half of the U.S. combat forces sent to Southeast Asia traveled by ship.¹⁰ In 1982, the British took up the Queen Elizabeth 2 and Uganda to support operations in the Falklands. Liners also provide support during national disasters, as demonstrated by the Federal Emergency Management Agency’s charter of the MS Grand Celebration and use of two state maritime academy training ships in the Caribbean during the 2017 hurricane season. The Maritime Administration recently awarded a contract for construction of the first National Security Multi-Mission Vessel, which will provide education platforms and emergency response capabilities.  

Back to a Maritime Future

In December 1916, the U.S. Navy had a total of 245 ships. Within two years, that number had tripled. Before the outbreak of World War II, the U.S. Navy possessed a fleet of 396, but by the end of the war it had increased 17-fold.¹¹ How was the Navy able to grow so rapidly? In both conflicts, it was able to call on not only a military infrastructure but also a vast commercial one.  

In World War I, the growth of the Navy was aided by the incorporation of yachts, tugboats, interned German and requisitioned U.S. passenger liners, and the militarization of the commercial merchant marine. These ships, along with an accelerated building program of destroyers, submarines, and submarine chasers and the inclusion of the Coast Guard, brought the Navy into second place behind the United Kingdom. Coincidentally, the U.S. merchant marine also expanded into a similar position.  

During World War II, the Merchant Marine Act of 1936 brought work to shipyards so that when the Two-Ocean Navy Act was passed in 1940, they were available to transition into naval construction. In Newport News, the slipway that launched the passenger liner SS America went on to launch the USS Indiana (BB-58), Yorktown (CV-10), and Ticonderoga (CV-14), followed by the Leyte (CV-32). The amphibious fleets at Guadalcanal and off North Africa in 1942 consisted of ships taken up from the merchant marine. The standardized ships of the Maritime Commission provided the basis for many landing ships, auxiliaries, escort carriers, and other craft, while adding capacity to the shipyards.  

Today, some may ask if this is still applicable. The largest ships in the U.S. commercial fleet, the four Alaska-class tankers built by the National Steel and Shipbuilding Company (NASSCO) and operated by the Alaskan Tanker Company, are 941.6 feet long and capable of carrying 1.5 million barrels of crude oil. They possess the genesis of military utility.  

The Alaska class formed the basis for the two Montford Point–class expeditionary transfer dock ships that support the Marine Corps’ Maritime Prepositioning Ship program. They can carry three air-cushion landing craft (LCACs) and can dock alongside Maritime Prepositioning Ships and large medium-speed roll-on/roll-off ships and offload in-stream. They also are the foundation for the expeditionary sea bases of the Lewis B. Puller class.  

In time of war, the Alaskas could be loaded with diesel and JP-5 fuel and set up as fueling points for the U.S. Navy, as was done during World War II in isolated atolls across the Pacific. One Alaska-class tanker could replenish ten Kaiser-class oilers. In addition, the ships could form the basis for a new generation of hospital ships; the Mercy class was converted from supertankers. 

Another successful commercial–military ship endeavor is the Austal-designed and -built Spearhead-class expeditionary fast transport (T-EPF). Based on the success of the MV Westpac Express and HSV Swift and the company’s experience with commercial high-speed ferries, the Navy and Army sought similar platforms. Built in the Alabama facility that constructs one class of the littoral combat ship, the most recent transport, the USNS Burlington (T-EPF-10), entered the fleet in November 2018. The ships serve as platforms for drug interdiction, humanitarian operations, Marine Corps expeditionary services, and troop and equipment transportation. They have filled in for Navy platforms as needed, similar to earlier Maritime Commission–built ships and tank landing ships (LSTs), all derived from commercial designs.  

The ships operated by the Military Sealift Command (MSC) are crewed by members of the merchant marine, employed either directly by the Navy or through commercial companies. Of the current ships in the Navy, 20 percent—not including ships held by MSC or the Maritime Administration as surge sealift assets—require civilian merchant marine crews.¹² 

The Navy is dependent on the commercial side for fleet resupply and the movement of military forces. In the event of war, this issue is magnified. A 2017 Government Accountability Office report on the vessels in the surge sealift and combat logistics fleets sheds light on the need for the nation to address both the military and commercial aspects of sea power: “Without effective capital planning to ensure the availability of surge sealift capability, the equipment and supplies needed by the Army, Marine Corps, and other forces may not arrive when needed, potentially hindering U.S. operations.”¹³ 

Can the United States be considered a true thalassocracy—a true maritime power—if it has a Navy in first place but a merchant marine in 22nd? If the United States is determined to be a modern sea power—as it was during World War II—it must develop the commercial aspect of sea power commensurate with its Navy and its reliance on maritime trade.¹⁴