Days after an alleged Chinese spy balloon captured the attention of social media, testimony given before Congress on February 8 by the president of the Shipbuilders’ Council of America, Matt Paxton, drew attention to a long-term national security threat more alarming than any spy balloon.
Paxton’s concerns about how inconsistent and unpredictable funding cycles affect U.S. shipbuilding mirror concerns the inland waterways industry has had for years about how those same inconsistent funding cycles affect waterways infrastructure. Those funding starts and stops lead to overall higher project costs and wasteful overruns that have been only partly addressed in recent infrastructure bills like the Infrastructure Investment and Jobs Act.
According to Navy leaders, the recent bulge in infrastructure spending exacerbates a shortage of key workers needed to staff shipyards and meet the goal of a 355-vessel Navy laid out by Congress in 2018.
American shipyards are not directly subsidized, as Paxton reminded the House Armed Services Committee members—and as Jennifer Carpenter, president of The American Waterways Operators, also said in a recent podcast on the Jones Act.
That contrasts with our overseas competitors who see shipbuilding as part of their national security—including China. All other major shipbuilding countries, not just China but Taiwan and South Korea, subsidize their shipyards. According to Statista.com, China accounted for almost 50 percent of the world’s total shipbuilding capacity in 2021.
It’s not just the amount of funding a project receives that counts but how wisely and predictably it is spent, Paxton told committee members.
“An unpredictable budget and acquisition environment with repeated shifts in fleet size and mix and funding delays make [capital expenditure] and facility investment decisions more difficult for shipyards. Moreover, once the [shipyard workers] are lost as production lines are stopped and started, they are more and more difficult to replace.”
These issues should concern all Americans.