Passage of the Coast Guard and Maritime Transportation Act of 2014: A Critical Step in the Revitalization of U.S. Shipbuilding and Merchant Marine

Floor Speech

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Mr. GARAMENDI. Mr. Speaker, on December 10th, I was proud to bear
witness to the passage, under Unanimous Consent, of the House and
Senate compromise language for the Coast Guard and Maritime
Transportation Reauthorization Act of 2014. S. 2444, the culmination of
months of hard work and diligent analysis by Coast Guard Subcommittee
Chairman Duncan Hunter, House Transportation and Infrastructure
Committee Chairman Bill Shuster, Ranking Member Nick Rahall, Senator
Rockefeller, Senator Thune, myself, and our staff, is a beacon of the
thoughtful compromise and responsible lawmaking we hope to see more of
in the coming years.

Notably, S. 2444 contains a provision to ensure that our commitment
to U.S. maritime is maintained as America considers the possible
exportation of liquefied natural gas (LNG). Existing law, written
before the natural gas boom when America was forecasted to be an LNG
importer, authorizes the Secretary of Transportation to develop and
implement a program to promote the transportation of imported LNG on
U.S.-flag vessels. Under the Deepwater Ports Act, the Secretary is also
required to give top priority to the processing of licenses for LNG
import facilities that will utilize U.S.-flag vessels. S. 2444 includes
language from H.R. 5270, the Growing American Shipping Act, to
modernize these laws. LNG exports will now be included in the program
to promote the use of U.S.-flag vessels in the carriage of LNG, and the
Secretary will be required to give priority processing to export
applications for deepwater port terminals that would utilize U.S.-flag
vessels.

The U.S. shipbuilding industry and U.S. natural gas market are
strategic national assets essential to U.S. national security
interests. Shipbuilding is critical to the growth and flow of our
economy, and to our ability to control the safety and security of the
global supply chain. It is also essential to the United States Navy,
which relies on a select few remaining shipyards for the construction
of new ships and the repair and refitting of existing ships. Despite
this importance, our foreign trade fleet has declined from 1,200 ships
in the 1950s to less than 100 today, and despite having pioneered gas
tanker technology, America no longer manufactures LNG tanker ships. To
transport LNG by sea, the world must rely on China, Japan, and South
Korea to build the requisite tankers.

Further decline of the U.S. shipbuilding industrial base will
continue to erode competitive bidding among shipyards, both for
commercial builds and for Navy shipbuilding needs, thus compromising
efforts to reduce the deficit and balance the national budget. It will
also result in the further loss of marine engineering expertise,
preventing the adoption and utilization of the same cutting edge ship
construction technologies used by our foreign competitors. Furthermore,
tens of thousands of American jobs, both inside shipyards and
throughout the U.S. supply chain, depend on the strength of the
maritime industry.

The decline of the shipbuilding industry threatens another strategic
national asset in reducing key personnel. The U.S. Merchant Marine is a
highly trained, militarily-useful labor force, and American merchant
sailors are the foundation of our marine transportation system. Further
attrition of the Merchant Marine threatens American security because
our nation relies on this secure source of labor for the movement of
supplies and military cargo and personnel. The explosive nature of LNG
strengthens the need to ensure that the transport of LNG, especially
through U.S. ports, is done by U.S. seafarers, and not foreign crews
that come with an increased potential for sabotage.

The export of LNG is projected to slowly ramp up over the next two
or three years and will then quickly accelerate over the next decade or
more. This will allow both time and a stable, long-term market demand,
which--if given the correct incentives--could spur the U.S.
shipbuilding industry to re-tool its infrastructure and processes to
ramp up the production of domestic tankers, paving the way for
production of vessels for export of this strategic national asset. It
is in the U.S. national interest to utilize the emerging LNG coastwise
and export trades to provide reliable, long-term markets for U.S.
commercial shipbuilding and for U.S.-flag operators, to expand and
increase the U.S. shipbuilding industrial base, and to use LNG export
trade to strengthen U.S. strategic interests and alliances with LNG
trading partners.

Therefore, it is the purpose of this law to enhance the national
security and port safety of the United States by encouraging to the
maximum extent practicable the transport of LNG on U.S.-built and -flag
vessels. This law aims to maintain the technological ability of the
United States shipbuilding industry to build and repair vessels for the
Navy and the Coast Guard by maintaining the critical industrial
infrastructure and skilled human workforce necessary to build such
vessels. Further, this law promotes American job creation by
encouraging domestic shipbuilding and the use of U.S. mariners in the
transport of American LNG.

This provision of the Coast Guard and Maritime Transportation Act of
2014 is supported by the Maritime Trades Department (AFL-CIO); the
Seafarers International Union (AFL-CIO); the Transportation Institute;
the Shipbuilders Council; the Navy League of the United States; the
American Maritime Officers; the Marine Engineers' Beneficial
Association (MEBA); the International Association of Masters, Mates and
Pilots (MM); the Maritime Institute for Research and Industrial
Development (MIRAID); the Marine Firemen's Union, Metal Trades
Department (AFL-CIO); the Sailors' Union of the Pacific; the American
Maritime Officers Service; and the American Maritime Congress. I thank
these organizations for their commitment to national security, a strong
maritime industry, and the creation of good American jobs so vital to
the economic prosperity and future of this nation.

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