Courtesy of Surface SITREP, published by the Surface Navy Association (www.navysna.org)
Edward H. Lundquist: Admiral, you’ve had a maritime career that has focused on both the Navy and merchant marine industry. Today you are the Maritime Administrator. Tell us about your job.
Rear Adm. Mark “Buz” Buzby, USN (Ret.): In my time kicking around the waterfront, I’ve dealt with the nation’s ships and Sailors from several different angles. This is yet another angle. The majority of my career has been with the Navy – 34 years as a “CRUDES” Sailor in surface combatants, but with my roots were in the merchant marine. I attended the U.S. Merchant Marine Academy at Kings Point, so a good part of my beginnings were in that part of the seagoing industry, and I always had that lurking in my background. My last job in the Navy was with Military Sealift Command, basically running the Navy’s “merchant marine,” if you will, and I got to see it from that angle. Now I’m seeing it from the other part of this nation’s sealift capacity, meaning the government-owned, Ready Reserve Force (RRF) ships, plus the commercial merchant vessels that make up our national sealift capacity.
What does your job encompass?
My job is to foster and promote the U.S. maritime industry, which is the ships, the mariners, the training of mariners, the shipbuilding and repair industry, and the ports and infrastructure and waterways. It’s all of that part of the maritime network, which is other very critical half of the equation of being a maritime power. You have the naval side and the commercial or the merchant marine side. I’ve been fortunate enough now to be a contributor to both parts of the entire sea power equation. You don’t have one, really, without the other.
With the responsibility to “foster and promote,” isn’t that kind of like the “chamber of commerce” mission?
That’s actually in the statutory description of the mission of MARAD. We’re unique in the Department of Transportation in that we have that role. We’re not regulatory like all of the other modal administrators. We are more focused on helping to make sure we have a strong industry. Plus, we have that national security role that the other modes really don’t have, and that’s through our operation of the National Defense Reserve Fleet, and in particular the Ready Reserve force – those 46 ships in the ready reserve force make up the vast majority of the immediate sealift capacity of the nation. Within the maritime industry, the Coast Guard has primary regulatory responsibility, and the Federal Maritime Commission has the regulatory authority for shipping rates and competition. So we don’t really regulate. We “foster and promote.” We try and make the industry stronger and more competitive.
So in fostering and promoting, what do you see as your biggest challenges and opportunities?
Education. We need to help people understand the role of the merchant marine in our economy today, and the very critical role it plays in our national security on many different levels. That’s really been the big eye-opener for me in the year I’ve been in the job. This agency needs to help educate all manners of U.S. public – the general public, Congress, other parts of government, and our armed forces.
If you are speaking to a Navy audience, how would you “educate” them?
I think the most important thing the Navy needs to understand is the is the sustainment that they rely upon to do their missions – in other words, having enough fuel, ammunition and groceries to conduct prompt and sustained operations at sea – that sustainment comes directly through the Military Sealift Command, and MSC is essentially sustained by the commercial merchant marine in that we’re hauling things forward for operations. It’s also the only way that significant ground combat power gets moved forward – and that’s for the Army and Air Force primarily. That’s how it gets moved off of our shores to anywhere else in the world. While you may see Soldiers and a few vehicles getting into the back C-17s, the combat formations of gear that those warfighters are going to fall in on gets moved in commercial ships with commercial mariners driving them. So all of the fuel that’s going to be needed to fight a major war in the Western Pacific, for instance, will be hauled forward in commercial bottoms, by commercial mariners. So, you really can’t operate our Navy – or the other armed forces for that matter – in far-flung areas for very long without it ultimately relying on commercial merchant marine and commercial mariners carrying that sustainment forward.
Do we have the capacity in terms of the numbers and types of ships? And do we have the qualified mariners to do that in a major situation?
I’ve testified that we don’t have enough mariners to do the job completely today. I’ve testified that we’re about 1800 mariners short to do a sustained sealift operation. And that means that the ships that we do have – which are the 46 ready reserve force ships that MARAD operates; the 15 sealift ships that MSC operates; plus the 60 ships from the Maritime Security Program – that are commercial ships that are receiving a stipend from the government to be ready to do a government mission, plus the two squadrons of Maritime and Afloat pre-positioned ships that would join the sealift effort after they offload their pre-pro cargo supplies – all of those ships are manned by commercial mariners – every single one of them. And all of them are required in our most stressing war plans to be used making multiple runs – not just one run over and back and they’re done – but making multiple runs. And that’s based on the most recent Mobility Capability Review Study (MCRS) with the up-to-date requirements for sealift. And we now have more war plans that we’re planning toward than we did before. Russia’s gonna be back in the game, and there’s a couple others that we hadn’t planned toward in the past decade because we haven’t needed to, and now we’re gonna need to. So that only just ups the requirement.
So how do we get those mariners?
It’s going to be a challenge, but it comes down to understanding the dynamics of manning in the maritime industry. In order to have mariners, you must have something for them to do. They must have jobs. Because Coast Guard licensing has changed from the past, we now have Standards of Training, and Certification of Watchkeepers (STCW), which are international standards for persons on seagoing ships. They are fairly stringent, extensive and costly to maintain. So, unless you’re a practicing mariner, actually going out and sailing on a regular basis, it becomes cost prohibitive to maintain a license. It used to be that you didn’t have to sail all the time. If you wanted to activate a license, as many mariners did for Desert Shield and Desert Storm, all they had to do was get their radar upgrade and medical exam and they were ready to go to sea. You can’t do that today. There’s an extensive list of high-cost training that takes time to accomplish in order to make sure that you’re qualified to sail in an international voyage in an unlimited capacity. So for many people – unless they have a job or are actively working in the industry – they’re getting out. They can’t afford to stay. Even upgrading a license from entry level watchkeepers to supervisory level is a much more major undertaking these days. Many see it as just not worth it. That’s part of where our shortage is coming from.
Is that because the mariners have to pay for that training themselves?
In many cases they do, yes. Some unions cover some of it. It’s the time that’s significant. And it’s also what is keeping a lot of what we call “hawsepipers” – folks who didn’t go to a maritime academy but worked their way up from the deck plates and trained on their own – from getting licensed in the first place. That the cost and the time is driving them away from being able to do that, in many cases. But unless there’s jobs for those mariners, we’re not going to get more mariners. The military-to-mariner (M2M) program is a good program to help military people transitioning out of active duty and it will help some with the manning, but there has to be someplace for them to go work. That means a ship with open billets, and that means we have to have more ships. We currently have 182 large ships under U.S. flag that require unlimited tonnage people to run them. That’s it. That’s the work base we have for people to be hiring on. There are about 41,000 Jones Act vessels, and only 100 of those are big tankers and container ships. The other 82 are internationally trading ships, and the government is already paying a stipend to 60 of them. Those are the 182 ships that require unlimited licenses, so that’s where those mariners can go work. That number of ships doesn’t support very many people. We figure two crews of about 22 people per crew, per ship. So we figure that each ship supports about 44 people, give or take, some a little bit more, some a little bit less. That equates to roughly about 11,800 mariners.
That are licensed or certified?
That are unlimited-licensed or credentialed and are actively sailing. In other words, they’re in the game. That means they’ve sailed within the last 18 months. So their medical is good, they’re up to speed on all of their requirements and quals and if we need them, they’re ready to go. There are certainly a number beyond that that have either gotten out of sailing because there wasn’t jobs enough for them, or they decided to let their quals lapse or whatever. So you gotta get more ships to get more people. But you can’t just say, “I want to have more ships.” Ships have to have something to do – they have to have cargo to carry to be economically viable. That gets to having to generate cargo – there has to be something for them to carry, or the ability for them to carry it – which now means they have to compete. There’s a finite amount of cargo in the world to carry. And the thing that has always been the challenge for US flag ships is the ability to carry that cargo that’s up for grabs at a competitive rate. And when they’re having to deal with what I would call a very uneven playing field – other foreign carriers often operating in very heavily subsidized atmospheres where their bottom line is a whole lot different than the U.S. flag carriers’ bottom line – it just makes it extremely difficult to compete and extremely difficult to get their piece of that cargo.
I thought it was because the U.S. had more regulations, and our labor costs are higher.
That’s part of it, too, but that all equates to money. That all equates to the delta of ship operation, which roughly is about 6 million dollars a year between a U.S. flag ship and a ship right down the pier, a foreign flag operator of a similar sized, similar capability ship. That $6 million dollars a year difference is why we have that Maritime Security Program (MSP) where the government pays $5 million a year, to allow the participating U.S. flag carrier to at least be a little more competitive, at least get on the playing field. And then we have something called “cargo preference,” which are laws that that specify that a certain amount of US government cargo must be carried on a U.S. ship. So that steers a little bit more must-carry cargo onto a U.S. flag ship. For DOD cargo, it’s 100 percent. If the ship’s available, the DOD cargo must be carried on a U.S. ship. For all other U.S. government cargoes like food aid, it’s 50 percent. So between the stipend that we pay for some of our ships and that cargo preference, that’s what’s allowing those 82, essentially, to exist. If you took away the stipend and cargo preference, or the Jones Act (accounting for the other 100 ships), you’d be taking those ships away. So now you’ve just taken out the employment base for the majority of U.S. mariners. Boom. Like that. Gone. Because any carrier is likely going to take those ships that are currently under U.S. flag because of the Jones Act, and flag them out in a heartbeat and put a foreign crew on there that will save them $6 million right off the top. Bang. Those mariners are gonna be out of a job. I will no longer be able to call upon them when it comes time to man-up the sealift fleet. My 46 ships that are leaning against the pier right now around the country are in a 5-day readiness with 9-person crews. When the bell rings, there won’t be U.S. mariners showing up on the brow to flesh out the crew because they won’t be around anymore. So, we will have just directly impacted national security by taking away our country’s sealift capacity. So, just making that connection and telling that story, is the essence of what I’ve been trying to do to make people understand that we’re not just giving a free handout to some shipping companies. We’re ensuring that there is a body of trained mariners and the vessels that go with them to conduct our war-time sealift mission. Because the entire system depends on them being there.
How do we change that equation to generate cargo and the commercial enterprise to carry it?
Cargo is King. It always starts with cargo – figuring out a way to make more cargo-available for U.S. vessels to carry. Or said another way: establishing the economic conditions for U.S. Flag shippers such that the rates they are then able to charge to carry cargo are more competitive with foreign flag carriers. If there’s more cargo available, then there will be more ships to carry it. And when there’s more ships to carry it, there will be more jobs for U.S. mariners. Increasing cargo preference is one approach to build some capacity. Increasing the size of the maritime security program beyond60 ships is another. There are proposals that would say “double it” – make it 120 ships, or make it some larger number and make the stipend larger so that the ships are more competitive. Knowing that they will get their operating cost difference made up, they can now go out and charge rates that are going to be more competitive for the international cargo that is out there now.
So how do you create more cargoes?
The cargo is out there. There’s lots of it. It’s a matter of getting the accessibility to it, so that our carriers are more competitive for the cargo that’s out there. In other words, the rates that they will be able to charge aren’t as large as they are now because they’re making up their operating difference in their rates. If we can make that up with stipend, now the rate is competitive and they can get some of that business. There will always be some very large foreign carriers that are operating these mega container ships in alliances, just because of the scale of their operation, that they can charge an advantageous rate based on those efficiencies. We just launched the largest US built container ship for the Jones Act trade a couple of weeks ago, up in Philadelphia – Matson Navigation’s Daniel K. Inouye. It’s a 3,600 TEU ship. The largest U.S. flagged container ship trading internationally is about 5,500 TEUs. The ships we’re running are small ships. They’d be feeder ships in any other market. There are container ships out there with 22,000 TEUs and up. The economic scale of operations has just taken off.
The U.S. and state maritime academies are the major source of qualified licensed mariners. You have an oversight role of all the academies – especially the U.S. Merchant Marine Academy. Can you tell me a little bit about that role?
As a part of my manning and training responsibilities, Kings Point comes directly under my responsibilities as the federal academy, and the other six state maritime academies all work closely together with us. We provide the training vessels for all of those academies, and some operating funds for the maintenance of those ships and some assistance in fuel. We also operate the Student Incentive Program for a certain number of students, about 75 per year, at the state maritime academies that basically pays for their education in exchange for a commitment to serve the government.
Do any of the state maritime academies charge a tuition?
They all do. And it’s not cheap, which is why this student incentive program – an $8,000 a year payment – really helps with the tuition. And in exchange they make a commitment to serve if we were to call them. The big difference, though, between Kings Point, the federal academy, and the six state maritime academies is everybody coming out of Kings Point has an unlimited ocean license, and they all have the service commitment. That’s not true with the six state maritime academies. A number of their graduates have unlimited licenses, but they also graduate people with limited licenses. So I’m primarily interested in the unlimited tonnage because those are the people that are going to be operating the big ships. Not that the others aren’t important for doing Jones Act functions, such as tugs and barges, that sort of thing. All of the training vessels are part of the National Defense Reserve fleet. The federal government provides those training vessels to the academies, which we can recall, if necessary, to perform governmental missions – as we saw this last fall in hurricanes Harvey, Isabel, and Maria, where we activated three of those school ships: the Kennedy, Empire State, and the General Rudder, from Massachusetts, New York, and Texas, respectively, to support FEMA in post-disaster recovery missions.
That’s one of the selling points of the NSMV. Why is that an important program?
This country has never had a purpose-built training vessel to train merchant mariners. We’ve always relied on former naval or merchant marine vessels that became no longer viable for commercial service to use as training platforms. The result is that we were using dated equipment to train our newest generation of mariners. So the NSMV is a keel-up built, focused training vessel which has training as its primary mission, but then has that secondary role of disaster relief and humanitarian assistance mission that has become more and more called upon by this country. We’ve seen it since Superstorm Sandy, and ever since then, we’ve called on these training vessels to be part of this nation’s response. So it only makes sense to build some real capacity based on what we have learned.
How many NSMVs will we build?
There is FY 18 funding for one, and we’re proceeding down the road to contract for and build that ship. Both the House and the Senate have included funding for a second ship in the ’19 budget, and we’ll see what happens in the outer years.
Do you see down the road a third or fourth?
I would like to see that. I would like to recapitalize the training fleet because they are old. The first two NSMVs will replace ships that are 56 and 52 years old, respectively. They’re grand old ships but dated, and we want to train our mariners with current equipment like they will encounter professionally. So these new ships will enable us to train better mariners.
How would you characterize your naval career in preparing you for this job?
The obvious part is just understanding ships and what it takes to put a steel ship to sea and maintain it in a very corrosive environment over its life. So having an idea of the scale and what’s required to operate that ship. And then what is required in terms of manning and training a workforce to operate those vessels at sea, and in very harsh and demanding environments. As a naval officer who came through Kings Point, I think I had a better understanding of the role that the merchant marine played in support of the pointy-end Navy. Seeing how much fuel they go through, the burn rates, how quickly you can empty a magazine, and knowing what’s entailed to make sure that the rest of the logistics train will be there when we need it. If we get into a real shoot-‘em-up match, we’ll be out there going full bore. We’re going to be steamin’ around at high speed; classifying with ordnance; flying stuff all over the place; and expending consumables pretty damn quick. We’re going to be taxing our combat logistics fleet pretty heavily. They’re going to be doing a bucket brigade from some forward operating base. The fuel, bombs and everything they’re delivering will come to them by a commercial merchant marine. That kind of understanding is very helpful now in this role.
You were involved with converting USS Ponce to the first afloat forward staging base.
It was a great use of an old, about to be retired multi-purpose naval asset and applying a slightly different thought process to it with capabilities from the commercial world that gave it even greater flexibility. It was the brain child of ADM John Harvey, Commander Fleet Forces at the time, and it was a tremendous use of all the capabilities he had under his command to generate an entirely new capability needed by the warfighter. We removed some of the restrictions that come with operating a Navy ship, and separated out those missions that could be done more efficiently by the commercial side, like driving the ship around and operating the plant, and leaving to the military what the military does best: the combat mission. I think it really optimized that very old ship and gave it 5 more years of frontline service. I hear from Fifth Fleet all the time – they love the new Expeditionary Support Base (ESB), but Ponce gave them tremendous capability and there’s aspects of that ship – like the well deck – that they miss. I think it’s exciting to have a new ship like ESB with the new mission set; Ponce was the proving ground for many of the SOPs used in the ESB today.
What’s the best part of this – the most fun part – of this job?
I get to stay kicking around the waterfront, associated with ships and sailors. That’s the biggest thing. It’s been interesting to rediscover that there is so much more to the maritime world beyond just the Navy – and it’s interesting, necessary, and critical to our national security. And I like still being part of that national security equation, just from a little bit different angle. I’ve had the privilege now of being on both sides of the sea power equation, both the kinetic side and also the commercial and economic “soft power” side of it, if you will, and it’s all required. You can’t have one without the other.
Before this job you ran a trade association.
That’s right. The National Defense Transportation Association (NDTA), which was a nice fit between the Navy and the commercial world. It was a perfect stepping-stone for me to help get a little bit more of a commercial education.
I would imagine that really helped to prepare you for this.
Many of the same issues I’m dealing with right now I previously dealt with at NDTA. We were kind of the go-between, if you will, between USTRANSCOM, MSC, MARAD and industry–at least on the maritime side. I’ve sat in three different seats at the NDTA Board of Directors table: the MSC Commander seat, the NDTA president’s seat, and now the Maritime Administrator. So, I just cycled around the table!
What can you tell us about Kings Point? There’s been some really serious fits and starts up there in the past decade.
There has. That’s now very much in the wake these days. It’s very positive when you go up there now. We’re going to be having a new superintendent come on board, we’ll have a change of command probably later this fall up there. The whole sexual assault and sexual harassment issue that was very much a headline-grabber, has been addressed. We’ve done a lot at the academy, and here at MARAD, to set some policies and to set some conditions that make it a lot safer for midshipmen to train both at the academy and at sea. So, there’s a lot of interface with industry on that, and industry has really stepped up in that respect. But the biggest change, I think, is that the midshipmen themselves have really taken ownership of the issue. They truly have. Last year, the Class of 2018 really decided that they did not want this to be a part of their culture. And they’ve really stood up. They initiated a campaign called “Be Kings Point.” So everybody knows that “You ARE Kings Point. You OWN this. BE Kings Point.” That got everybody focused on their own personal actions – “your actions impact all of us and we’re all in this industry together and we’re gonna be working together with each other for the next 40 years, so we need to start behaving like true professionals and true shipmates.” And it fit right in with a command philosophy that I shared with the Regiment when I made my first visit after taking over at MARAD. I told them my command philosophy is, “Put your people first. Be a professional. Be a good shipmate.” And their “Be KP” campaign kind of embraced a lot of those tenets.
I think we saw a lot of the cultural shift in this past school year and I think it will continue to go forward. I hope it will. Because that’s really the bottom line. All the edicts and rudder orders that come out of my office or from the Superintendent will have little effect unless the Midshipmen themselves decide they are going to behave differently. The signs are all very positive. We previously had a situation where there would be no reporting of SA/SH incidents, yet people in surveys would say all this behavior is going on. They didn’t report it because they didn’t trust the system. Nobody trusted each other. Now we have reporting that we believe equates to the number of actual incidents.
What about the Savannah, the first nuclear-powered merchant ship, which is under MARAD?
Congress has fully funded in FY ’18 the dismantlement of the nuclear power plant and all of its supporting elements, which will occur over a 5-year period. The core has been gone for years. There’s no nuclear material onboard the ship at all. But there’s Nuclear Regulatory Commission standards that have to be maintained when you dismantle a nuclear power plant. So we will be scrupulously following those. The ship’s going to stay in Baltimore for the time being. Most of the work will be done there. We’re gonna be cutting accesses pretty soon to start that process. It will be well publicized and very transparent to the local community so everyone will know what’s going on every step of the way. We have a program officer that will be managing that whole process – and it’s going to be tracked very closely and monitored very closely by me, obviously, and I will report to the Secretary on a regular basis. The ultimate disposition of the vessel remains to be seen. After we remove the power plant, the ship – the hull and everything else –will be made available an organization that hopefully will operate it as a museum, or a historic ship. So we’ll see. There’s been a couple different entities that have come up online saying they’d be interested in operating it if they could figure out how to do it. It’s historic. I remember building a model of it as a kid and putting the reactor inside of it. There are a lot of people in Baltimore that have kind of adopted it and would like to see it stay there. We’re happy that we can now take this to its completion and get that ship ready for another life doing another mission.
It’s still a beautiful ship.
Yeah. She’s got great lines. Very pleasing to the eye. Aye!