The fiscal, maritime and national security factors influencing the development of the Maritime Security Act of 1996 (MSA)

The Merchant Marine Act of 1936 established the federal government's policy of developing and maintaining a commercial merchant marine capable of carrying a substantial portion of the nation's waterborne commerce and performing as a military auxiliary in time of war. Today the merchant marine continues to serve the nation in commerce and provides sustainment sealift assets and skilled seafaring crews to help meet DOD strategic mobility requirements. To maintain such a fleet, a highly regulated system of subsidy payments was provided to ship owners to offset the higher costs associated with the U.S. registry. Despite the outlay of over $14 billion in aid, the U.S. merchant marine has continually declined both in numbers of ships and the percentage of U.S. trade carried. This study examines the development of the Maritime Security Act of 1996 (MSA), and the policy decision to continue financial assistance in support of maintaining the merchant marine. To analyze the implications of this policy a comprehensive examination of congressional documents and industry publications was conducted. DOD and DON mobility planners can benefit from this study, as the condition of the merchant marine impacts both national security and mobility readiness. The study concluded that the MSA was a compromise reflecting many interests, reducing federal investment in the program and requiring recipients of payments to make available their entire transportation infrastructures to support DOD mobility requirements in times of crisishttp://archive.org/details/fiscalmaritimena00kottLieutenant, United States NavyApproved for public release; distribution is unlimited