Today, in the United States, is National Maritime Day. There is a presidential proclamation and everything. The day, May 22nd, was chosen because that was the date that the American steamship Savannah set sail from Savannah, Georgia in 1818 on the first ever transoceanic voyage under steam power. Well, partially under steam power, at any rate. Perhaps, tellingly, the Savannah was not a commercial success and was converted back to a pure sailing ship shortly after her return voyage from Europe.
For all intents and purposes, the United States no longer has a significant merchant marine in international trade. In 1955, the US flag fleet represented almost 25% of the world’s overall tonnage. Today the fleet represents less than 2% of total world tonnage. But we still have a National Maritime Day, as authorized by Congress in 1933.
Last night, I had the pleasure to attend the 75th birthday party for and on the historic tanker Mary A. Whalen. (My thanks to Carolina and the great folks at Portside New York. A great party.) It was a beautiful evening, but as I looked out at the empty piers and sheds on the Atlantic Basin I was reminded of how different the Brooklyn waterfront was when I first saw it almost forty years ago, when it was bustling with hundreds of ships and thousands of tugs. The now empty sheds were full of general cargo from all over the world and the empty Brooklyn waterfront streets were crowded with trucks carrying cargo to or from the docks. Walking along Red Hook’s Imlay Street past the massive New York Dock Company warehouses felt like stumbling into the set of a post-apocalyptic movie, except with fewer zombies.
Container ships, which revolutionized shipping and which were developed in the United States, still call at Red Hook, Staten Island and Port Newark and Port Elizabeth, but the US container ship operators are all gone or swallowed up by foreign operators. Virtually the only container ships flying the US flag in international trade these days are foreign-owned ships operating under the Maritime Administration’s Maritime Security Program (MSP) which pays subsidies to operate the ships under the US flag. According to the Maritime Administration, US flag ships cost roughly 2.7 times more to operate than foreign flag ships, with crew costs being over five times higher. Ironically, while these US flag ships have foreign owners, US owners operate a much larger fleet of of foreign flagged ships in international trade.
The US also has a tax structure that is particularly unattractive to US flag operators. This is a particular irony as the US tax code allows foreign operators based in the US to pay little or no Federal taxes. Carnival Corp is a prime example.
Last night as I watched the sunset from the quiet Brooklyn docks I was reminded of the wisdom of Pogo. “We have met the enemy and he is us.” A happy National Maritime Day to all.