According to the U.S. Department of Transportation (USDOT) website, the Maritime Administration (MARAD) “promotes development and maintenance of an adequate, well-balanced, United States merchant marine, sufficient to carry the nation’s domestic waterborne commerce and a substantial portion of its waterborne foreign commerce, and capable of serving as a naval and military auxiliary in time of war or national emergency.”
In addition, MARAD is charged with ensuring that the U.S. has “adequate shipbuilding and repair service, efficient ports, effective intermodal water and land transportation systems, and reserve shipping capacity in time of national emergency.”
The Maritime Administration origins go back to the Shipping Act of 1916, which established the U.S. Shipping Board. The Shipping Board was the first federal agency with the responsibility to regulate U.S. commercial shipping and promote the U.S. merchant marine.
World War I began in August 1914, and over time, the war caused major disruptions in shipping. The disruptions were a key reason that Congress passed the 1916 law. Congress established the Shipping Board “…for the purpose of encouraging, developing and creating a naval auxiliary and naval reserve and a Merchant Marine, to meet the requirements of the commerce of the United States with its territories and possessions and with foreign countries; to regulate carriers by water engaged in the foreign and interstate commerce of the United States.”
The U.S. was a neutral nation for nearly three years after World War I began. However, its ships and citizens were vulnerable. On January 28, 1915, the American merchant ship William P. Frye, which was transporting a cargo of wheat to Great Britain, was sunk by a German cruiser. Tensions increased after a German submarine sank the British ocean-liner Lusitania in May 1915. Among the nearly 1,200 passengers who died were 128 Americans.
Following additional shipping losses, the Shipping Board’s role of meeting peacetime shipping requirements was changed after the U.S. declared war on Germany on April 6, 1917.
With authority from the Shipping Act, the Shipping Board created the Emergency Fleet Corporation (EFC). The EFC began a massive ship and shipyard construction program; it acquired, managed and operated ships on behalf of the Shipping Board. World War I ended in November 1918 – before the construction program reached full capacity – however, ship construction continued until 1921. By then, nearly 2,300 new ships had been built.
Unfortunately, the massive shipbuilding program resulted in a post-war surplus of ships; causing a lengthy depression in the industry. Congress then passed the Merchant Marine Act of 1920 in an attempt to steady the industry. The EFC was renamed the Merchant Fleet Corporation in 1928. Then the Merchant Fleet Corporation and the U.S. Shipping Board were merged under the U.S. Department of Commerce in 1930 as the United States Shipping Board Bureau.
Merchant Marine Act
Congress passed the Merchant Marine Act of 1936, which created the U.S. Maritime Commission. The Commission took over the duties, functions and property of the Shipping Board Bureau. Although this legislation was passed 85 years ago, it still governs many of the programs that support the American maritime industry.
President Franklin Roosevelt appointed Joseph P. Kennedy, Sr. as the Commission’s first chairman. As with its predecessors, the U.S. Maritime Commission was charged with advancing and maintaining a strong merchant marine to support U.S. commerce and defense. The Commission’s responsibilities included regulating ocean commerce, supervising freight and terminal facilities, and administering construction and operational subsidy funds for private commercial ships.
Moreover, the Merchant Marine Act authorized the Commission to “design and construct 500 modern merchant ships over a 10-year period.” The construction program was in progress when World War II began; the Commission’s peacetime responsibilities changed significantly – just as the Shipping Board’s had been altered by war in 1917.
War Shipping Administration
Following the Japanese attack on Pearl Harbor, the U.S. entered World War II on December 8, 1941. Among the many actions to transform the nation and government to a war footing, President Roosevelt established the War Shipping Administration (WSA). Executive Order 9054 effectively separated the Maritime Commission into two parts – the Commission to design and construct ships and the WSA to acquire and operate them. The two agencies worked together – in part because Admiral Emory S. Land served as both the Chairman of the Maritime Commission and as WSA’s administrator.
From 1942-46, the Maritime Commission and WSA managed the “greatest industrial shipbuilding and ship operations effort ever seen.” Almost 6,000 merchant vessels and naval auxiliaries were built. In addition, the WSA managed the simultaneous operations, repair and maintenance of thousands of ships. After the war was won, the WSA was eliminated; its functions were transferred back to the Maritime Commission in 1946. In peacetime the government no longer needed as many merchant cargo ships; under the Merchant Ship Sales Act, several thousand ships were sold or disposed of. However, a number of ships were retained to form a reserve shipping fleet, which was known as the National Defense Reserve Fleet.
Under a 1950 reorganization plan developed by the Truman administration, Congress eliminated the U.S. Maritime Commission. Its functions were split between the new Maritime Administration and the Federal Maritime Board (FMB). Both agencies were part of the U.S. Department of Commerce. As part of the reorganization, the Maritime Commission’s subsidy and ocean shipping regulatory functions were transferred to the FMB. In addition, the Commission’s promotional and government-owned shipping interests were the responsibilities of MARAD.
Another governmental reorganization occurred in 1961. The FMB was renamed the Federal Maritime Commission. As part of the reorganization, the subsidy functions were transferred back to MARAD as the Maritime Subsidy Board, which reported independently to the MARAD Administrator. These reforms – now 60 years old – are still part of MARAD’s current organizational structure.
Transfer to USDOT
Finally, MARAD was transferred to the USDOT in 1981, which completed the consolidation of all federal transportation programs into one cabinet-level department.
Under USDOT, MARAD is still responsible for promoting the development and maintenance of a strong merchant marine – both for national defense and further development of its foreign and domestic commerce. As part of its responsibilities, MARAD operates the United States Merchant Marine Academy (which is located at Kings Point, New York). MARAD also provides and maintains training ships and funding for the six state maritime academies in the United States.
In addition, MARAD continues to operate a fleet of government-owned cargo vessels that are maintained to support national security requirements. The gray-colored ships of the Ready Reserve Force (RRF) are positioned strategically in U.S. ports. The ships are readily identifiable by their distinctive red, white and blue stack bands. The ships are managed by commercial companies. As needed, the RRF ships are available to support the deployment of U.S. military forces overseas and in national emergencies.