With an executive order supporting the growth of the American shipbuilding industry now in place, U.S. lawmakers are reintroducing a bipartisan bill designed to help carry out that mission.
Sens. Mark Kelly (D-Ariz.) and Todd Young (R-Ind.) joined Reps. John Garamendi (D-Calif.) and Trent Kelly (R-Miss.) in reintroducing the Shipbuilding and Harbor Infrastructure for Prosperity and Security (SHIPS) for America Act in Congress Wednesday morning.
The bill seeks to address a major national security concern surrounding Washington—there is a monumental gap in shipbuilding activity between the U.S. and China. Trump’s EO already set in motion the creation of a shipbuilding office in the White House, formally titled the Office of Maritime and Industrial Capacity.
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At its core, the SHIPS for America Act is designed to close this gap and boost the U.S. Merchant Marine by establishing national oversight and consistent funding for U.S. maritime policy, cutting red tape to make U.S.-flagged vessels commercially competitive in global commerce, rebuilding the U.S. shipyard industrial base, and expanding and strengthening mariner and shipyard worker recruitment, training and retention.
There are currently 80 U.S.-flagged vessels in international commerce while China has 5,500.
“After decades of dangerously neglecting our shipbuilding industry, we’re finally doing something about it,” said Sen. Kelly, a U.S. Navy veteran and the first U.S Merchant Marine Academy graduate to serve in Congress. “Building and staffing more U.S.-flagged ships will create good-paying American jobs, make our supply chains more resilient, lower costs, and strengthen our ability to resupply our military at times of war. We’ll keep working with our colleagues in Congress, this administration, and our partners in the industry to make our country safer and competitive by passing the SHIPS for America Act.”
The legislation now includes a goal to expand the U.S.-flag international fleet by 250 ships in 10 years with the creation of a strategic commercial fleet program. This objective was not included in the original version of the act introduced in December.
This program would provide support payments for capital and operational costs to encourage the introduction of new U.S.-built, -flagged and -crewed vessels.
Additionally, the bill would establish a maritime security advisor within the White House, who would lead an interagency maritime security board tasked with directing the national maritime strategy.
The SHIPS Act would carry out several other directives from President Donald Trump’s EO, including the creation of a maritime security trust fund to provide funding for programs aimed at shoring up shipbuilding capacity. The high costs that come with building a military and commercial vessel have been a major barrier—alongside a shortage of mariners—in getting the U.S. shipbuilding industry back up to speed with its Chinese counterparts.
Texas A&M Maritime Academy superintendent Michael Fossum, a former astronaut colleague of Sen. Kelly’s, said during a press conference at the Capitol that the act would provide the support needed to boost training program enrollment and revamp training berths without having to pass the costs down to students.
“Build these new fleets, and we will get you the crews you need,” Fossum said. “But we have to get costs down to get students in the doors.”
Cargo-carrying standards within the original December legislation remain in place. One section raises the percentage of U.S. government cargo that must sail on U.S.-flagged vessels from 50 percent to 100 percent. Another requires that within 15 years, 10 percent of all cargo imported from China must be transported on U.S.-flagged vessels.
And to make room for shipbuilding purposes, the bill would also expand the U.S. shipyard industrial base for both military and commercial oceangoing vessels by establishing a 25 percent investment tax credit for shipyard investments.
As of March 1, U.S. vessels only carry 0.4 percent of global tonnage at sea, according to maritime intelligence service Clarksons Research. China leads the world in shipbuilding capacity moving 34.3 percent of global deadweight tons, while South Korea comes in at 31 percent and Japanese ships move 26 percent.
The newer bill further disincentivizes the operations of ships on foreign soil. Vessels repaired in Chinese yards were set to face a 200-percent tariff, but now repairs in other foreign countries would also face a new 70-percent duty—unless waived under strict new conditions.
The reintroduced bill and the EO follow the recent determination by the U.S. Trade Representative (USTR) that determined China has an “unreasonable” dominance of maritime, logistics and shipbuilding capabilities that harm American commerce.
That ruling came after a nine-month probe into China’s activities in those sectors, which was spurred by five unions alleging that the country’s domestic shipbuilding industry has been unfairly propped up by state subsidies and ship-purchasing mandates.
Both the reintroduced bill and the executive order serve as an extension of President Trump’s wider protectionist platform, which has largely served to deter Chinese influence on American interests.
The most notable action from the administration has been the imposition of 145-percent tariffs on Chinese goods, effectively escalating ongoing trade tensions into a full-blown trade war.
Other co-sponsors for the SHIPS for America Act include Sens. Lisa Murkowski (R-Ark.) and John Fetterman (D-Pa.).
