“This is a Different Maritime Revival” says MarAd's Carmel
Stephen M. Carmel & MarAd are aiming to make this U.S. Maritime Rebuild Stick
For anyone who has spent a career in the U.S. maritime industry, the past two years have been unusual by any metric. Maritime has moved from the far margins of federal policy discussions to center stage, with rebuilding American shipbuilding, the Merchant Marine and the maritime industrial base elevated a national priority. Action to shore up the big ship, military portion of the equation has been rapid and measurable. But beyond the top echelon of defense contractors, many mid- and small-tier yards and suppliers have been left waiting. For the builders and operators of the towboats, tugs, barges, ferries and workboats that populate America’s waterways, however, there is an understandable response: ‘Enough talk. Where is the work?’
Stephen M. Carmel, Administrator of the U.S. Maritime Administration (MARAD), understands the skepticism. He also believes this maritime revival is fundamentally different from its predecessors.
“I think everyone alive has been through at least two, if not more, maritime revivals,” Carmel said, describing previous initiatives that “last until the next appropriation cycle and die. This is a different maritime revival,” he said.
The difference, according to Carmel, starts with geopolitical competition: ie. China’s aim to dominate global maritime; and extends to bipartisan political support and the willingness to provide funding. “There is a coalescence of national will around it that has not existed, if ever, in my lifetime,” he said. As with previous efforts to ‘revive U.S. shipbuilding’, ultimately, time will tell.
A Commercial Maritime Industry First
For Marine News readers, perhaps the most important element of Carmel’s agenda is his insistence that rebuilding American maritime cannot simply mean building more Navy ships. It requires rebuilding a commercial shipbuilding and operating base. “When we start seeing the transition from MOU signings and champagne toasts in Washington DC to shovels turning dirt at potential shipyards in the next year, that’s how we’ll know we’re making progress. I’m certain that is possible.”
“Our job in the Maritime Administration is to rebuild a civilian commercial shipbuilding enterprise,” Carmel said. “First and foremost, that’s all I talk about. That’s all I do. That’s where our investments will be.”
Carmel argues that allowing America’s commercial shipbuilding base to erode ultimately damaged military shipbuilding, too. Once the commercial market disappeared, so did much of the supplier base, industrial depth, volume and innovation that accompany it.
“A strategic vulnerability is when you are the only customer for a critical vendor,” he said. When government becomes the sole customer keeping suppliers alive, the result is neither economically healthy nor particularly resilient.
Commercial maritime requires an ecosystem, Carmel argues, not simply a collection of isolated yards. That includes equipment manufacturers and suppliers, and ultimately domestic production of major machinery that today must be imported. “We need a robust ecosystem,” Carmel said. That argument resonates particularly strongly in the smaller commercial yards that build America’s workboats, towboats and coastal vessels. Carmel noted specifically that MARAD’s Title XI financing program is not solely intended for large oceangoing ships. “Title 11’s for smaller stuff too,” he said.
The problem is that too many potential users have historically looked at the program and walked away because of its complexity. Carmel said MARAD is working to streamline Title XI and turn it into a modern vessel-construction financing tool that commercial operators actually want to use. “We cannot build with scale if we cannot finance at scale,” Carmel said.
MARAD is similarly rethinking shipyard grants, emphasizing investments that “significantly increase their productivity” and capacity rather than simply distributing individual grants without considering how they strengthen the broader maritime system.
The Great Lakes: Not an Afterthought
Carmel’s definition of American maritime strength extends well beyond the coastal deep-sea ports that typically dominate Washington’s maritime conversation. “The Great Lakes, the inland waterways, the ports. We actually have five coasts,” Carmel said.
That fifth coast is the Arctic, and Carmel argues that both the Great Lakes and Alaska need to become integrated into everyday thinking about American maritime power rather than appearing as regional afterthoughts. “When the Great Lakes start being part of the mainstream conversation of what maritime dominance looks like, then I know we’ve made progress,” he said.
Similarly, “We are an Arctic nation and we better remember that.”
For Carmel, that means treating the Great Lakes, inland rivers, ports, coastal waterways and Arctic as components of a single transportation and national-security network. Nowhere is the weakness of that network more evident than on America’s inland waterways.
Carmel calls them “the absolute arteries of American commerce,” but argues that their condition remains unacceptable. “We need some serious investment in the inland arteries that sustain the lifeblood of America,” he said. “And that’s our ports and locks and inland waterways system.”
It is a particularly relevant message for the towboat and barge industry. Building new vessels, modernizing fleets and strengthening coastal ports accomplishes little if the locks and waterways connecting the nation’s interior are allowed to deteriorate.
“It does no good at all to build out this robust seacoast stuff if we’ve let the interior of the country fall apart,” Carmel said.
He points to the Soo Locks as a textbook example of infrastructure that can become a single point of national economic failure. Citing a government study, Carmel said a six-month closure could cause between $1.2 trillion and $1.4 trillion in economic damage, put 11 million people out of work and inflict potentially unrecoverable damage on the U.S. steel industry.
“One lock,” he said. “That should scare anyone.”
His prescription is simple in concept, if difficult in execution: “We need to find out where the single points of failure are and fix them.”
Cargo Creates Ships
Ultimately, no amount of shipyard investment matters without customers. For Carmel, the entire commercial-maritime equation therefore starts with cargo. “The U.S. Merchant Marine is first and foremost here to carry the nation’s commerce and then carry the nation to war when we need to,” he said.
Government-impelled cargo alone, he argues, is insufficient to rebuild the industry. The objective must be to put more normal U.S. commerce aboard U.S.-flag vessels, creating the demand signal that encourages operators to invest in ships.
The proposed U.S. NPR mechanism starts by reserving 3% of the nation’s commerce for U.S.-flag vessels, according to Carmel, before ramping upward and eventually transitioning toward U.S.-built ships. “The first fundamental thing we have to do is address the root of everything, which is cargo,” he said.
But that does not absolve American shipbuilders of responsibility. Carmel pushes back against yards that simply say they need a demand signal before investing. “There’s some responsibility on the part of the shipyards to get down a cost curve and demonstrate how,” he said. Government can help through grants, financing and cargo policy, but the yard must ultimately have a credible plan for becoming more productive.
Nuclear: Don’t Miss the Next Revolution
While much of Carmel’s agenda deals with repairing America’s existing maritime system, his most ambitious idea is aimed squarely at changing its future: commercial nuclear propulsion based on small modular reactor technology. “SMR-powered nuclear technology will transform trade and shipping every bit as much or more than the container did,” Carmel said. “It is going to revolutionize the very architecture of trade.” MARAD has signed an MOU with the Port of Long Beach to deploy SMR technology for shore power, which Carmel views as a stepping stone toward nuclear ship propulsion. More recently, MARAD and CORE POWER (US) Inc. signed an agreement to accelerate the commercial, industrial, and regulatory pathways for U.S.-flagged nuclear-powered commercial ships.
Importantly, he does not view the primary obstacle as reactor technology. The challenge is creating the surrounding commercial ecosystem — liability structures, infrastructure, regulation and port acceptance — that allows the technology to work in the real world.
The lesson is NS Savannah, which Carmel described as an “elegant piece of engineering but a commercial failure. We don’t want to repeat that,” he said.
Carmel sees nuclear working in tandem with artificial intelligence, potentially changing ship size, port design, economies of scale and the fundamental architecture of transportation.
“SMR has the potential to transform the way trade happens,” he said. “AI will actually execute it.” Together, he believes the technologies could “shape the way trade works for the next 50 to 100 years.”
Building the Entire System
Perhaps Carmel’s most relevant message for the coastal, inland and Great Lakes audience is that the current maritime discussion cannot be allowed to devolve into another narrow exercise centered exclusively on large ships and large coastal shipyards.
The industry is a system.
It includes the Gulf Coast yard building a towboat, the operator pushing barges through aging locks, Great Lakes vessels hauling raw materials, coastal ports, commercial mariners and an Arctic coastline that Carmel believes America ignores at its peril.
“If I could advocate for anything,” Carmel said, “it would be for a bigger understanding of what the maritime ecosystem is. It is a system. And it does no good to treat one part and ignore the rest.”
There is plenty of reason for skepticism. The maritime industry has heard revival speeches before, and the distance between Washington rhetoric and shipyard orderbooks remains considerable.
Carmel, though, believes the biggest barrier may ultimately be one of attitude. “Our biggest weakness, our biggest challenge is our own attitude,” he said. “We can revitalize our shipbuilding industry. We can revitalize our maritime industry, but we’re not going to get there if we abandon the fight before we take the field.”
For America’s commercial maritime industry — from the inland rivers to the Great Lakes, coastal waters and Arctic — the opportunity is considerable.
Now comes the difficult part: turning the talk into steel.
* As published in the September 2026 edition of Marine News.
