Mark Kelly (00:03):
All right. Morning everybody.
Audience (00:06):
Good morning.
Mark Kelly (00:07):
Thank you for coming. It's great to be here today to celebrate the reintroduction of our Ships for America Act. I want to recognize the co-leads of this bill, who will speak in a moment, my partner in the Senate, Senator Todd Young from Indiana, and then in the House, Representative Trent Kelly from Mississippi, Representative John Garamendi from California. I want to thank you for all your hard work on this legislation. I've also got a lot of folks here who worked on this bill with us who are going to be very critical to making it a success. You'll hear from a few of them, but I want to thank everybody for coming and being such an important part of this effort.
(00:53)
Now, we've got the people here who build ships and produce the materials that go into them, including the Shipbuilders Council of America, the Steelworkers' Union, the American Iron and Steel Institute, and the Alliance for American Manufacturing. We've also got the men and women who will at times spend months away from their friends and family, serving aboard US flagged vessels as merchant mariners, literally ensuring that ocean-going trade can happen. And we've got representatives from the institutions that are going to help deliver the workforce that we need, including the Great Lakes Maritime Academy and Texas A&M, and my alma mater, the United States Merchant Marine Academy.
(01:51)
It's been about 40 years since I spent a semester at sea as a midshipman. I was on ships going to South America, to Europe, through the Indian Ocean, to the Middle East, and also to Japan, and a lot has changed since then, not all of it for the better. There are currently 80 US-flagged vessels in international commerce. Do you know how many China has? So we have 80. China has 5,500, and they're building a lot more every single year. And the United States commercial maritime industry cannot keep pace with China's shipbuilding and maritime fleet, and it's driving up costs and it is threatening our national security.
(02:48)
It means that so many of the products that get shipped to American ports, that are then put on trains and trucks and sent to stores everywhere from Arizona to Indiana are on Chinese ships, built with subsidies from the Chinese government, and at a price set by Chinese companies. So that's why today we're reintroducing the Ships for America Act, which is without a doubt the most ambitious effort in a generation to revitalize the US shipbuilding and commercial maritime industries and counter China's dominance over the oceans. And this is going to mean more ships built in America, more ships staffed by American crews and more products coming to our country on those American ships. This is going to be good for our economy and good for our national security. It's going to create good-paying American jobs. It's going to make our supply chains more resilient. It's going to lower costs and strengthen our ability to resupply our military in times of war.
(04:06)
Now, tackling this challenge has been a top priority for me since becoming a senator, because I've seen how the decline of our maritime industry has affected our country. I've seen it up close, and I know how China's dominance over the oceans impacts my constituents in Arizona, but also everybody across our nation. Now, I'm glad that my colleagues in Congress, both Republicans and Democrats in the House and in the Senate and in the Administration, see this challenge too and are now ready to actually do something about it. So let's get this done. So let me start by passing this along to my colleague in the Senate, Senator Young, who is a US Naval Academy graduate, who is a former United States Marine and a great leader on this effort. Senator Young.
Todd Young (05:03):
Well, thank you, Senator Kelly. Thank you for your longstanding leadership on this essential issue. Ladies and gentlemen, it is time to make American ships again, yo? And let's hear it for our merchant mariners. Let's hear it for our merchant mariners. We value you, we support you, and we're going to get this done. Because America's rise from 13 colonies to the most powerful nation on earth was in part because of sea power, and by power we mean not only the world's mightiest navy, though we have that, but also its greatest commercial fleet. We had that at one time. The first defends our people and values on the oceans. The second carries our goods and goodwill across them. Both are crucial for national security and economic security.
(06:10)
Teddy Roosevelt understood this. He knew something about naval history and shipbuilding. He said that the spread of our trade in peace and the defense of our flag in war depended on America possessing the world's largest commercial fleet. But right now, with our rusted maritime sector and abandoned shipyards, we're very far from having that. The opposite is true across the Pacific Ocean. Today, China has 5,500 commercial vessels in the international commerce. The United States? 80. They build a thousand ocean-going ships every year. We build roughly five.
(06:57)
We should call this convergence, the rise of China's commercial fleet and the fall of our own, what it is. It's a pending national crisis. If our economy depends on goods carried aboard, Chinese flag vessels, our supply chain is always at the mercy of the Chinese Communist Party. If we have only a few seaworthy commercial vessels, we'll struggle to transport our troops to the front lines in the case of a conflict in the South China Sea. If our commercial shipyard, industrial base continues to collapse, if we do nothing, we'll be unable to build and repair warships. It's, of course, time to change course. It's time to rebuild our merchant marine.
(07:47)
Help is on its way. The Ships for America Act is our blueprint. To begin this endeavor. Our bill will fund and cut the red tape stalling US maritime policy. It will boost the US merchant marine, revive our shipyard industrial base, protect our people and economy from foreign threats, and provide good-paying jobs to Americans: Americans whose creativity will help build the commercial fleet of the future. We're not the only ones hoping to end our shipbuilding decline. Last month, President Trump signed an executive order encouraging private investment to help raise new shipyards. This is a critical national and economic security issue, one that transcends party. It is time to make American ships again. Let's go. Next up will be Congressman Garamendi, one who has shown great leadership on this issue.
John Garamendi (08:56):
Thank you, Senators. Really appreciate working with you. We're going to do this. We're going to make it in America again. It's a policy that all of us have been working on for a good long time. We're going to bring jobs back to America. We're going to bring jobs back to our shipyards: shipyards that we once derelict. In California, the Mare Island shipyard was shut down. The oldest naval base on the West Coast. It was shut down. It's going to be revitalized. It's already on its way. We're going to make jobs all across this nation: in the steel industry, in the shipbuilding industry. This is the most comprehensive piece of legislation dealing with the American maritime industry ever introduced. It covers all of the subject matters that are necessary. All of the supply chain, all of the parts, the steel, the engines that are going to be built in the upper Midwest, the steel that's going to be produced, some of it in California and a lot of it in the Midwest. It's jobs coming back to America. And on the ships
John Garamendi (10:00):
… ships. We will see these young men and women, and maybe not so young, that are going to be back on the ships in the future. It can be done, it will be done. The Rosie the Riveters during World War II said, "Let's get it done," and that's exactly what we're going to do today. We're going to make sure that there is cargo on those ships. If cargo is king, it's part of this legislation. If it's the workers, if it's the men and women that need to be trained to be on the ships, that's going to happen because the maritime academies across this nation will be funded, their services will be increased. And the multi-mission ships, the fifth is now being built in Philadelphia, it's going to wind up at the Maritime Academy in Vallejo. And I know the other maritime academies have also received those ships.
(10:55)
It's all of the pieces of the puzzle. It's the most comprehensive maritime improvement legislation ever introduced. And it didn't come about because we wished it, it came about because of the hard work of our colleagues in the Senate and in the House. I want to shout out to Mike Walsh who decided he ought to go over to the administration and the National Security Agency, good work there. But Mike's work early days in putting this together, the legislation, was profoundly important and his support in the White House continues along that way.
(11:29)
All of them, you see here, just a small portion of the people that have been working on this legislation. Even yesterday, some final pieces of legislation were written so that we can all come together to make this happen. We will get it done. We will follow the Rosie the Riveters that said, "Let's get it done." That's exactly what we're going to do, and it's going to take all of the support that you see here to make it happen. Every piece of it is in this legislation. And it didn't just happen because we wished it, it happened because of a lot of hard work over more than a decade. Individual pieces of the puzzle have been in play all along the way, and now it's in one piece of legislation. Ships for America. That is our rallying call. Those are the signs, we're going to make it happen. Thank you so very much for the support of my colleagues.
Mark Kelly (12:27):
Now, we'll hear from my distant cousin, Congressman Trent Kelly.
Trent Kelly (12:32):
Thank you, Senator. You know what you're seeing here today is a revitalization and a reemergence of us as the greatest maritime nation in the world. And it's got to be public, it's got to be private. It's got to be in the House and the Senate and the Administration. If we want to get back to our roots and the thing that made us the greatest nation in the history of the world, we have to get back to being the greatest maritime nation in the world. And I can speak about the past, we've been there so we know how to do it. And not that much atrophy has set in. We know we can do it in the future. You see our future behind us. This is our future. It's also those young workers who are looking for careers in something that they can be proud of. It is in the House, bipartisan in nature, both the Republican, Democrat, House, Senate, Administration, but it's got to be public-private, it's got to be the whole of government. We have got to make sure we have synergy, we have energy. We have got to finish the product.
(13:43)
It is unacceptable for us not to be the greatest maritime nation in the world now and always. And to do that, we have to build our maritime industry across this nation. And whether you're talking about the Port of Gulfport in Mississippi, or whether you're talking about Indiana or anywhere in middle America that makes pieces, parts, or ships. Whether we're talking about the West coast of America or the East Coast of America. Whether we're talking about the Atlantic or the Pacific, the Indian Ocean, anywhere in the world, our maritime dominance. But what it takes is it's going to take all of you. It's going to take each and every one of you putting every fiber of your being into making sure that we maintain the momentum that we have now to once again be the maritime dominant leader across the world. Because our ideas and our spirits of America, we're democracy and we believe in democracies delivering. That means it's a team effort and I need all of you. Thank you, Senator Kelly, Senator Young and Representative Garamendi. God bless, America.
Mark Kelly (14:55):
Now, one of the first parts of this is we need to make it more economical to build more ships in America. Nobody can speak better on that than Matt Paxton, who is the President of the Shipbuilders Council of America.
Matt Paxton (15:13):
Well, thank you Senator Kelly. This is a true moment in revitalizing our shipyard industrial base. Thank you, Senator Young. Thank you, Congressman Trent Kelly, and thank you Congressman Garamendi. We've had our fights on a lot of legislation in the past, but this is truly a moment in time. The Ship for America Act is a generational piece of legislation. I am so proud to be here in this moment. Our patriots that work in our shipyards are absolutely essential, they're national security assets, and this legislation is going to double down on the investments made in our shipyards, in our facilities, in our people. And I couldn't be more proud to be standing at this moment in this time, truly bipartisan, truly bicameral. And just down the street at the administration with an office of shipbuilding, this is a moment that we must seize. And the men behind me and all the Merchant Marines, I am so proud of this moment. God bless America.
Mark Kelly (16:26):
Thank you, Matt. The Ships for America Act has the support of many unions who understand maybe more than anybody else how this is going to improve the lives of hardworking Americans. I'd like to introduce a graduate of the US Merchant Marine Academy from the class of 2019. Kings Point is my alma mater, so it gives me great honor to introduce Chief Mate Elizabeth Levy, member of the organization of Masters, Mates & Pilots.
Chief Mate Elizabeth Lev (17:01):
Thank you, Senator. I'm Elizabeth Levy, a chief mate, proud union member of Masters, Mates & Pilots and a proud graduate of the United States Merchant Marine Academy in Kings Point, New York. I started my career as a professional mariner 10 years ago. My career has taken me globally as well as in our backyards. I've sailed on commercial container ships, bulk carriers, on the Great Lakes and on military pre-positioned ships sailing on US flag vessels domestically and internationally. I serve as a lieutenant in the United States Navy as a Strategic Sealift Officer. I'm proud to stand here today as a professional mariner, a proud union member of Masters, Mates & Pilots. I'm grateful to have a job which has allowed me to see the world and connect each and every one of us with global goods and serve my country. My job has allowed me to make a good living, to be able to pursue the American dream, to buy a house, invest in my community and my future. I'm thankful to work in an industry that rewards a strong work ethic and being a good shipmate.
(17:58)
Yet despite these things and the opportunities that working as a professional mariner have afforded me, there are not enough of us and there is a mariner shortage. Why is this? As with all things, there are many layers that contribute to this, whether it is the hurdles to gain, renew, and maintain credentials, or the crumbling state of the United States Merchant Marine Academy, which is in desperate need of infrastructure revitalization, or the dwindling amount of US flag vessels for American Mariners to sail on? I currently sail as a civilian mariner on army Prepositioning ships. These vessels carry critical equipment to support our nation's defense needs abroad. This job places professional mariners like myself in harm's way. The same is true for all of us who sail on ships in the US fleet, whether it's serving on a defense mission or those on commercial container ships having missiles launched at them in the Red Sea.
(18:49)
This is why American's Merchant Marine is called the fourth arm of defense and often the forgotten one. We are ready, willing, and able to answer our country's call and to respond as American mariners have always responded to support American troops deployed anywhere in the world. Professional Mariners like myself are sailing 24/7 globally on every ocean and waterway, performing work that is critical to our nation's security, defense, and economic needs. The American Merchant Marine has been essential since the birth of our nation, and through every conflict.
(19:22)
The US Navy was actually created to protect US Merchant Marine ships. This is why I'm happy to be here today to endorse the Ships for America Act, both as a professional mariner and on behalf of my union Masters, Mates & Pilots. This law will revitalize the US maritime industry. It will make our country stronger by increasing the size of the US flag fleet, and most importantly it will incentivize shippers to use US flag vessels to carry a greater share of America's foreign trade, an incentive that provides more jobs and opportunities to us Mariners, like myself, jobs which can support a family. Without cargo ships don't sail
Chief Mate Elizabeth Lev (20:00):
… and mariners don't work. More American ships means more jobs for US mariners, mariners who will step up to serve in times of peace and in times of war and other national emergencies.
(20:11)
The SHIPS for America Act will rebuild the US Merchant Academy, one of our nation's five federal service academies. USMMA graduates 80% of the US Navy Strategic Sealift officers, those officers who are service obligated to command vessels during times of conflict.
(20:28)
The SHIPS for America Act is an exciting piece of legislation. It will attract more young people to our critical industry. It will help retain those who have given their whole lives to this profession. It will help create and support jobs for American mariners, ensuring that our country has the maritime manpower needed to protect and enhance our nation's economic and military security. It will allow our nation to revitalize our maritime industry.
(20:54)
Invest in a professional mariners who have a skill set that is so desperately needed in today's global political space where a maritime conflict is just one event away at any moment. The time to invest in our nation's maritime strategy and dominance is now, and in the interest of our country's national security, defense, and economic needs, I urge Congress to pass it.
Mark Kelly (21:20):
Thank you, Elizabeth and I think as of today, the US Merchant Marine is not forgotten anymore. And finally, it's a personal privilege of mine to have somebody I know really, really well. He's a former astronaut, one of the very few people I have flown in space with more than once. And he's also the superintendent of the Texas A&M Maritime Academy, my very good friend, Mike Fossett.
Mike Fossett (21:52):
Thank you, Senator. 20 years ago, right now, exactly, Senator Kelly and I were training together for the second Return to Flight mission after the fatal space shuttle Columbia disaster in 2003. We had some time to talk and I was pretty sure back then he would find his way to the US Congress, and he was pretty sure I would find my way to Texas A&M University, my alma mater. But neither one of us could have imagined that we would be here today doing something like us way back then.
(22:23)
My name is Mike Fossett. After 36 years in the Air Force and NASA, I've accepted a new mission as the Vice President of Texas A&M University, the Chief Operating Officer of the Galveston campus, and Superintendent of the Texas A&M Maritime Academy.
(22:37)
We owe huge thanks to Senator Kelly, Senator Young, Congressman Kelly, and Congressman Garamendi for their strong leadership and relentlessly pushing forward to reintroduce this legislation that is vital to our national security and national economy.
(22:52)
They've already said a lot about that but I want to just point out also for everybody in the United States, 90% of everything we use, wear, drive, or consume travels on ships before it gets to us. For the state of Texas alone, the blue economy is 28% of the GDP of Texas. The the exports of the oil and gas and byproducts, the manufactured products, the agricultural products, cotton, citrus, beef, corn, et cetera, it's vital to our just local economy in Texas.
(23:26)
We've talked about the Military Sealift Command and the support for the deployed forces overseas at sea and overseas. I don't think we've mentioned that 17 of those vital ships are tied up right now, laid up, not being used because they do not have the mariners they need to crew them. Military Seal of Command made 12 recruiting trips to my campus in Galveston last year alone. It's a vital need.
(23:50)
The Texas A&M Maritime Academy is proud to be the only state maritime academy on the Gulf Coast. We're also the only maritime academy that is part of a tier one university which is a land, sea, and space grant institution with a research portfolio of over $1.2 billion. The Texas A&M extension service is also critical for workforce development and we have training centers near shipyards in Texas. So, we covered the full spectrum.
(24:21)
Now, Texas A&M Maritime is just one of six amazing state maritime academies, each with their unique qualities which are critical to training and educating the next generation of mariners. Together, we produce about 70 to 75% of the mariners for our nation with the balance coming from the Federal Merchant Marine Academy.
(24:42)
Now, let's talk some details of those state maritime academies as a whole. Enrollment in all of our programs together peaked in 2015 with about 3565 students enrolled. By '22 in the aftermath of COVID, enrollment in our programs declined by 35%. There's been some bounce back but not nearly enough. Why? There are many factors. We've spent a lot of time working this, but one of the biggest ones is the cost of the programs to students. We get very little support from the federal government for the operation of these training ships and most of that cost is passed on to our students. That cost equals more than an entire extra year in college for them. So, it's hard to get them in our doors. In 2015, the six training ships used by the Maritime Academies had 1920 berths. The training ships were old, really tired, and near the end of their life. Congress funded the new National Security Multi-Mission Vessels or NSMVs to build state-of-the-art training and coastal designs to response vessels. With these new NSMVs replacing the smaller ships, we've added over 1100 new training berth in our existing academies. With these new ships and existing university capabilities, we believe we can grow to handle a maximum of about 4400 cadets in our existing, unlimited license programs, and graduate over 1000 more new officers a year.
(26:19)
Additional investments in our campuses will enable most of us to grow even more, much more. Build these new fleets and we will get you the crews you need. But we have to get the cost down to get students in our doors.
(26:37)
Thank you again, Senator Kelly, for your leadership. We launched on our first mission on the Fourth of July 2006. It appears sir, we're on another mission together to serve our country. We don't know how long it's going to take, but our destination is clear. And we now have a mission plan to get us there. And we know when we start. Today, April 30th 2025 is our launch day. Thank you.
Mark Kelly (27:11):
Thank you, Mike. And now we have a few minutes to take some questions from the press.
Speaker 1 (27:18):
I have two questions. The first one is a little bit broader. [inaudible 00:27:22] if the original SHIPS Act were included in the executive order that the President signed out for shipbuilding? The press release that you guys put out got a lot of momentum building behind this. Is that because of sort of the executive branch sign off of a lot these decisions? What else is happening behind the scenes?
Mark Kelly (27:38):
The question was about momentum. Was it connected with the executive order from the White House on shipbuilding and the fact that there are some things in the executive order that apparently come from our SHIPS for America Act.
(27:52)
I would say, yeah, yeah, of course. I mean, to have an administration that's behind a significant piece of legislation is helpful and it's a lot of momentum. We're confident that if we get this across the finish line, bipartisan in the House and Senate, get it passed, that this administration will be interested in signing it into law.
Speaker 1 (28:22):
One other question about the tax provisions in this bill.
Mark Kelly (28:22):
Yes.
Speaker 1 (28:22):
Looks like you're broken out into a separate bill at least in the Senate.
Mark Kelly (28:22):
Yes.
Speaker 1 (28:22):
Can you explain why you had to maneuver that way to … ?
Mark Kelly (28:22):
Yeah, I could or I don't know if Todd wants to take that question about you know, just the fact that we put the …
Speaker 2 (28:25):
Yeah, sure. Yeah. So, I sit on the finance committee and it it was a decision to break off provisions pertaining to this legislation into separate legislation just so that in coming months as we reconsider various provisions of the tax code, we could also study these. Most of these provisions, however, fall outside of the general focus of the committee right now. So, it made a lot of sense for us to have a separation of labor.
(28:59)
We thought that this approach would facilitate faster passage. And since President Trump and the White House in addition to bipartisan supporters here in Congress and so many stakeholders are really emphasizing the importance of speed as is our new Secretary of the Navy who sees complementary efforts between this maritime initiative and his leadership which will be required to rebuild the US Navy, we wanted to do whatever we could to expedite the process.
Mark Kelly (29:32):
Go ahead.
Speaker 3 (29:33):
The other House, the legislation is comprehensive. It covers at least eight different committees in the House of Representatives. And so for us to move this legislation along, we need the support of everybody. The President's support, the President's cabinet support is extremely important in accomplishing that. As is the support of the bicameral and bipartisan that you're seeing here today. And there's a lot more members
John Garamendi (30:00):
Members of the House that have signed onto the bill from both Republican as well as on the Senate side. But the most important support comes from the people you see around us. It's the industry. It's the men and women that are on the ships and will be on the ships in the future. It's the men and women that are in the shipyards that'll be building those ships. And it's the total supply chain. I mentioned the engines built in the upper Midwest. All of that support is now focused on this legislation. And as we work through the normal processes of the legislative in the House and the Senate, we will fast track many of these issues through the committee because of the broad support that exists. It's not going to be easy. It's going to take a lot of work on all of us, Senate and the House. We're dedicated to make this happen. This didn't happen in one year. This has been at least a 20-year process, 15 years for me, and I know for Mark and the others similar number of years out ahead, it's all come together in the Ships for America Act.
Speaker 4 (31:05):
Senator Kelly, I'm interested to hear you say that this legislation could bring down the cost of shipping. Everybody I speak to, the companies that use shipping that will have to use more American built ships, American manned ships, they say it's going to push up the cost of shipping and they don't like efforts like that, like this because of that. Can you explain how this bill will reduce the cost of shipping for the exporters in this country?
Mark Kelly (31:30):
Well, first of all, I don't agree with that analysis, right? So the idea here, there are incentives in here, tax incentives and others to make it cost-effective for companies to ship goods on US vessels. Without the right incentives, you're not going to compel somebody to use an option that's more expensive. So we've spent a lot of time and effort on all aspects of this industry to bring down the costs. And to do that, you got to provide cargo preference incentives to put cargo on US ships, and that's in the legislation.
Speaker 2 (32:18):
Could I add to that?
Mark Kelly (32:19):
Yes.
Speaker 2 (32:22):
I thought Senator Kelly did a good job addressing one dimension of the cost. The cost at the consumer level. But there's another type of cost this of course is designed to address, and that is economic and national security costs. We have done a really bad job in recent histories in incorporating an economic and national security premium into the goods and services that we value. We saw this with semiconductors. In that case, we had a geopolitical or a natural event, the pandemic, interrupt supply chains, highly distributed supply chains. Not a geopolitical event, although in recent weeks we've seen interruptions of critical minerals which go into that supply chain. That's an illustration. And then we saw massive increases, spikes in the cost at the consumer level that redounded throughout the economy. You couldn't even go to Walmart and get a toaster for a period of time because we didn't have access to sufficient supply of semiconductors. That's a cost. That's a cost on our economy.
(33:33)
So this is an insurance policy and a national security investment just as we make all kinds of other national security investments in the future. We can no longer continue to be over the barrel every time we want to ship a good from here to there, asking our chief adversary, the Chinese Communist Party, "Mother, may I? Mother, may I use these ships?" That's an untenable position, a very costly position to be in.
John Garamendi (34:06):
Senator, you opened the China issue. Anyone that studies the cost of shipping, the cost of shipbuilding needs to recognize that yes, it's been expensive in America. If we are able to increase the ability of American built ships, those costs will come down. And my colleagues have spoken to that. The other side of the equation is, what is China doing? What is the Chinese Communist Party doing to build its shipping industry? Enormous subsidies in every single step along the way to build a ship. Those subsidies are found in the shipyards themselves, in the ability of China to build modern shipyards and in every part of the ship. And it doesn't stop there. It goes on into subsidizing the actual cost of the operation of the ship. Those subsidies have put China in an extraordinary advantageous position. And so as we look at the cost of shipping, please keep in mind that the Chinese Communist Party has subsidized its shipping industry in the construction and in the operation of the ships, and we're up against that. This legislation addresses every single one of the factors that will allow America to be competitive in that marketplace.
Mark Kelly (35:31):
All right, folks. Thanks for coming. A few of us will hang around for a little bit, but really appreciate everybody being here.
Speaker 4 (35:36):
Thank you [inaudible 00:35:43].
Speaker 6 (35:36):
Yes, sir.
Speaker 4 (37:18):
Thank you for your wonderful [inaudible 00:35:48].
Speaker 5 (37:48):
[inaudible 00:37:52].
