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U.S. Department of Transportation U.S. Department of Transportation Icon United States Department of Transportation United States Department of Transportation

A Short History of the Maritime Administration

Established in 1950 under the auspices of President Harry S Truman’s Reorganization Plan No. 21, the Maritime Administration (MARAD) traces its origins to the Shipping Act of 1916, which established the U.S. Shipping Board, the first Federal agency tasked with promoting a U.S. merchant marine and regulating U.S. commercial shipping. Congress enacted the 1916 law in part because of the severe disruptions in shipping caused by World War I. Specifically, Congress established the Shipping Board “…for the purpose of encouraging, developing, and creating a naval auxiliary and naval reserve and a Merchant Marine, to meet the requirements of the commerce of the United States with its Territories and possessions and with foreign countries; to regulate carriers by water engaged in the foreign and interstate commerce of the United States.

The U.S. remained neutral for nearly three years after Austria-Hungary declared war on Serbia in 1914, plunging Europe into what came to be known as the “Great War.” The first loss of an American merchant ship in World War I occurred on January 28, 1915, when a German cruiser destroyed the William P. Frye, which was transporting wheat to Great Britain. Germany quickly apologized for the incident but Americans were outraged. Tensions grew when a German submarine sank the British ocean-liner Lusitania in May 1915, taking 1,195 of its 1,959 passengers and crew down with it, including 128 Americans. America’s oceans could no longer isolate the country from European hostilities as they had for more than a century. After more shipping losses, the Shipping Board’s focus of meeting peacetime shipping requirements was eventually overshadowed when the U.S. declared war on Germany on April 6, 1917.

Under the provisions of the Shipping Act, the Shipping Board created the Emergency Fleet Corporation (EFC). The EFC organized a massive ship and shipyard construction program and acquired, managed and operated ships on behalf of the Shipping Board. The war ended before the construction program reached full capacity; however, ships continued to be built until 1921 by which time nearly 2,300 had been completed. This vast program resulted in a postwar surplus of vessels, which spurred a lengthy depression in the industry. In response, Congress passed the Merchant Marine Act of 1920, which had varying degrees of success. In 1928 the EFC was renamed the Merchant Fleet Corporation and in 1930 both it and the Shipping Board were absorbed into the Department of Commerce as the United States Shipping Board Bureau.

Six years later Congress passed the Merchant Marine Act of 1936, creating the U.S. Maritime Commission, which assumed the duties, functions, and property of the Shipping Board Bureau. This seminal legislation governs many of the programs that support the American maritime industry to this day. President Franklin Delano Roosevelt appointed Joseph P. Kennedy, Sr. (father of President John F. Kennedy) as the Commission’s first chairman. Like its predecessors, the U.S. Maritime Commission was charged with advancing and maintaining a strong merchant marine to support U.S. commerce and defense. The Commission regulated ocean commerce, supervised freight and terminal facilities, and administered construction and operational subsidy funds for private commercial ships. The Act also authorized the Commission to design and construct 500 modern merchant ships over a 10-year period, beginning with the transatlantic liner America. This construction program was well underway when war broke out again and the Commission found its peacetime purpose transformed just as the Shipping Board’s had been in 1917.

In 1942 President Franklin Delano Roosevelt established the War Shipping Administration (WSA) in response to America’s entrance into World War II. Executive Order 9054 effectively separated the Maritime Commission into two parts; the Commission to design and construct ships and the WSA to acquire and operate them. Although administratively separated, the two agencies worked closely together. The Chairman of the Maritime Commission, Admiral Emory S. Land, also served as WSA’s administrator. Between 1941 and 1946, the Maritime Commission and WSA managed the greatest industrial shipbuilding and ship operations effort ever seen. Nearly 6,000 merchant vessels and naval auxiliaries were constructed, with the WSA routinely managing the simultaneous operations, repair and maintenance of thousands of ships. With the war’s end, the government dissolved the WSA and transferred its functions back to the Maritime Commission in 1946. Under the Merchant Ship Sales Act, several thousand ships were sold or disposed of, while retaining a nucleus of reserve shipping known as the National Defense Reserve Fleet.

In 1950, acting on President Truman’s recommendations in Reorganization Plan No. 21, Congress eliminated the U.S. Maritime Commission and divided its functions between the newly-established Maritime Administration and the Federal Maritime Board (FMB), both placed within the U.S. Department of Commerce. ;The Maritime Commission’s subsidy and ocean shipping regulatory functions were transferred to the FMB, while the Commission’s remaining promotional and government-owned shipping interests were vested in MARAD. In 1961, as part of Reorganization Plan No. 7, the FMB became an independent regulatory agency and was renamed the Federal Maritime Commission; a title it retains to this day. The subsidy functions returned to MARAD in the form of the Maritime Subsidy Board, which reported independently to the MARAD Administrator. The 1961 reforms are the basis of MARAD’s current organizational structure.

In 1981, MARAD was transferred to the Department of Transportation, completing the consolidation of all Federal transportation programs into one cabinet-level department. MARAD is still charged with promoting the development and maintenance of a strong merchant marine for the national defense and development of its foreign and domestic commerce. To that end, MARAD operates the United States Merchant Marine Academy at Kings Point, New York, and provides and maintains training ships and funding for the six state maritime academies that include: the State University of New York (SUNY) Maritime College, Massachusetts Maritime Academy; California Maritime Academy; Maine Maritime Academy; Texas Maritime Academy; and Great Lakes Maritime Academy. MARAD also continues to own and operate a fleet of government-owned cargo vessels to support national security requirements. These gray-colored ships of the Ready Reserve Force are strategically positioned in ports around the nation and are readily identifiable by their distinctive red, white and blue stack bands.

Select Bibliography

  • Albion, Robert G., and Jennie B. Pope. Sea Lanes in Wartime: The American Experience, 1775-1945. New York: Norton, 1942. (Reprinted 1968 by Archon).
  • De la Pedraja, René.  The Rise & Decline of U.S. Merchant Shipping in the Twentieth Century.  New York: Twayne Publishers, 1992.
  • A Historical Dictionary of the U.S. Merchant Marine & Shipping Industry. Westport, CT: Greenwood Press, 1994.
  • Goldberg, Mark H. The “Hog Islanders.” (The American Merchant Marine History Series, Volume I). Kings Point, NY: American Merchant Marine Museum 1991.
  • “Caviar & Cargo,” The C3 Passenger Ships. (The American Merchant Marine History Series, Volume II). Kings Point, NY: American Merchant Marine Museum, 1992.
  • “Going Bananas,” 100 Years of American Fruit Ships in the Caribbean. (The American Merchant Marine History Series, Volume III). Kings Point, NY: American Merchant Marine Museum, 1993.
  • The Shipping Board’s “Agency Ships’, Part I, the “Sub Boats.” (The American Merchant Marine History Series, Volume IV). Kings Point, NY: American Merchant Marine Museum, 1994.
  • “Stately President” Liners, American Passenger Liners of the Interwar Years. (The American Merchant Marine History Series, Volume V). Kings Point, NY: American Merchant Marine Museum, 1996.
  • Kelly, Roy W., and Frederick J. Allen. The Shipbuilding Industry.  Boston and New York: Houghton Mifflin, 1918.
  • Lane, Frederic C. Ships for Victory. A History of Shipbuilding under the U.S. Maritime Commission in World War II.Baltimore: The John’s Hopkins University Press, 1951, 2011.
  • “Shipping Act of 1916.” 39 Stat. 728, chapter 451, approved September 7, 1916.
  • United States. President (1945-1953: Truman); United States. Congress. House. Committee on Expenditures in the Executive Departments.; United States. Commission on Organization of the Executive Branch of the Government (1947-1949). Reorganization Plan No. 21 of 1950: Message from the President of the United States Transmitting Reorganization Plan No. 21 of 1950, Which Effects a Basic Reorganization of the Functions of the United States Maritime Commission Along the Lines Recommended by the Commission on Organization of the Executive Branch of the Government. [here] Washington, DC: U.S. Government Printing Office, 1950.