Maritime Administration in Crisis
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Maritime Administration in Crisis

Maritime Administration in Crisis

Almost two weeks ago the Deputy Administrator of the Maritime Administration (MARAd), Orlando Gotay, resigned amid speculation that MARAd is in the throes of crisis.  The resignation came a day after the Journal of Commerce published an article citing industry displeasure with the way MARAd has conducted business under the leadership of David Matsuda (  In the article Matsuda credits industry anger to a few disgruntled lobbyists.  But there is more to it than that.

It is no secret that industry sentiment toward both Administrator Matsuda in particular and the agency in general is not positive.  The typical complaint cites MARAd’s mission: “To improve and strengthen the U.S. marine transportation system to meet the economic, environmental and security needs of the Nation,” and how MARAd leaders fail to abide by this mission.  The litany of complaints include, to name a few, MARAd’s failure to effectively deploy capital available under the Title XI Loan guarantee program for ship construction, MARAd’s failure to champion American shipping, MARAd’s issuance of Jones Act waivers without truly considering whether the American tonnage is available first, MARAd’s failure to understand the maritime industry, MARAd’s micromanagement of operations at the U.S. Merchant Marine Academy.

These are not insignificant shortcomings.  Historically MARAd has efficiently and effectively carried out each of these tasks, thereby bolstering the U.S. Merchant Marine as a whole.  The problem with the way the current Administration operates is that while some decisions may appear justifiable from a micro-level, such as issuing loan guarantees to a Brazilian company, when taking a macro view, the decisions do not make sense.

For instance, many in the industry wonder why MARAd failed to take the White House to task for shipping oil withdrawn from the Strategic Petroleum Reserve aboard foreign flag vessels.  Perhaps the current administration feels that shipping this cargo on American vessels does not fit directly into the MARAd mission and therefore it is not an issue worth fighting for.  Or perhaps Mr. Matsuda does not want to ruffle the feathers of the Obama Administration and thereby handicap his next job appointment.  But this is exactly the type of thing MARAd exists to promote.  If MARAd cannot champion the U.S. maritime industry within the federal government, no other body will.  The Strategic Petroleum Reserve oil cargo debacle exemplifies industry displeasure with the current Maritime Administration.  The argument goes that if the Maritime Administrator understood the U.S. maritime industry at all then he would understand that this was an issue worth fighting for.  And the fact that none of Matsuda’s immediate supporting staff is knowledgeable enough or able to persuade him to make an effort shows that the Administration as a body is on the wrong course.

From an industry perspective the resignation of the Deputy Administrator is not that much of a surprise.  Maritime Administration employees are leaving the organization at an increasing pace, attempting to distance themselves from an impotent organization with leadership that has shown its ineffectiveness repeatedly over the past two years.  Even worse, otherwise exemplary maritime professionals in Washington are not pursuing employment opportunities at MARAd for the same reasons.

Something clearly needs to change.  It is the earnest hope of many in the U.S. maritime industry, and not just a few disgruntled lobbyists, that when the time comes for Secretary of Transportation LaHood to appoint a new Maritime Administrator that he will not simply make another political appointment, but rather, he will appoint someone who “knows ships.”

  • S. King

    October 14, 2011 at 3:12 pm

    This situation also weighs in to the sudden ‘reassignment’ of RADM R, Greene from the US Merchant Marine Academy Superintendent. ?????????? Politics and micro management does NOT speak or do well
    to the educating of the US future Mariners. I am very concerned with this situation mentioned in the article and the actions taken at the Academy because my daughter just went through the 3 Superintendents in the 4 years she was at the Academy before she graduated in June, 2011.

  • Kevin Rawson T 457

    October 14, 2011 at 5:39 pm

    Well written article. The efforts of MARAd to complete their mission are totally inept, and at this point, threaten the security of the nation. It is unclear if the Obama Administration is pulling strings on MARAd for what ever reason; however if the administration is misusing MARAd and screws up statutes should not resignations be at a higher level. Sorry good people are resigning, Admiral Greene’s loss is unfortunate.

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