By Robbin Laird
When Franklin Roosevelt invoked the phrase ‘Arsenal of Democracy’ in December 1940, he was describing a specific industrial mobilizationL American factories redirected toward supplying a world under siege.
The phrase has echoed through successive generations as shorthand for the proposition that democratic nations, marshaling their combined industrial capacity, can outproduce and outlast authoritarian adversaries.
Today that proposition is being tested again, and the testing ground is maritime.
A new report from the Center for Maritime Strategy — Pier Review: Leveraging the Allied Maritime Industrial Base for U.S. Shipbuilding — makes the case with clarity and urgency: America’s maritime industrial base (MIB) is in its gravest condition since World War II, and no amount of domestic policy reform will be sufficient to reverse that decline within the timelines imposed by current strategic realities.
The answer must be found across allied industrial ecosystems, in Seoul and Genoa, in Helsinki and Vancouver, in Glasgow and Adelaide.
What the Pier Review report makes visible and what its analytical frame suggests is something larger than a shipbuilding deficit.
The allied maritime industrial reconstitution now underway is the 21st-century version of the Arsenal of Democracy, recast not as a single national mobilization but as a distributed network of allied industrial capacity, designed to deter and if necessary defeat authoritarian powers that have made maritime dominance a central instrument of their strategic ambition.
China’s shipbuilding capacity is assessed at over 200 times that of the United States by tonnage. That is not a procurement gap. It is a strategic asymmetry of a kind not seen since the worst years of the Cold War.
The Depth of the Problem
The numbers that frame the Pier Review report are sobering. The United States possessed 55 shipyards capable of building complex naval vessels at the end of World War II. Today, seven remain. American yards once produced approximately five percent of global commercial shipping tonnage; the current figure is effectively zero. The United States accounts for roughly 0.04 percent of global shipbuilding output, ranking nineteenth worldwide. Meanwhile the People’s Liberation Army Navy has surpassed the U.S. Navy in hull count, with assessments projecting growth to 460 ships by 2030. The Office of Naval Intelligence has assessed that one Chinese naval shipyard alone has the capacity of the entire American naval shipbuilding industry combined.
The U.S. Navy currently operates approximately 295 ships, well below its own stated goal of 381. The amphibious assault ship readiness rate dropped to 41 percent in 2025 under the combined strain of operational tempo in Latin America, counter-narcotics operations, and the ongoing Iran conflict, a conflict being fought primarily in the naval domain. In February 2026, the White House Maritime Action Plan acknowledged the gap explicitly and called for a Maritime Security Trust Fund, but funding mechanisms do not repair infrastructure, train welders, or restore institutional knowledge lost across four decades of deindustrialization.
The diagnosis is structural. Decades of inconsistent policy, the elimination of commercial shipbuilding subsidies in the early 1980s, a post-Cold War turn away from the maritime domain, and the long shadow of counterinsurgency operations have hollowed out the industrial base in ways that cannot be reversed quickly from within.
This is the condition the Pier Review study was designed to address and its core conclusion is that rebuilding requires the active engagement of allied industrial ecosystems, not as a supplement to domestic capacity, but as an integral component of a new, distributed Arsenal of Democracy.
The Allied Network Takes Shape
The Pier Review examines five allied maritime industrial bases — South Korea, Italy, Canada, Sweden, and the United Kingdom — across a common analytical framework covering labor, technology, design and manufacturing, government-commercial relations, infrastructure, and supply chains. What the country-by-country analysis reveals, taken together, is not a collection of bilateral arrangements but the rough architecture of a genuinely integrated allied maritime industrial network.
South Korea is the anchor of that network. Hanwha’s Geoje shipyard alone exceeds the combined square footage of Newport News Shipbuilding, Bath Iron Works, and Electric Boat’s Groton and Quonset facilities. The yard operates on firm-fixed-price contracts with financial penalties for late delivery and virtually no tolerance for the schedule slippage that American industry has normalized. One robot can replace 50 workers in welding operations; two technicians monitoring 20 robots can match the output of 1,000 personnel. This is not incremental efficiency improvement. It is a fundamentally different industrial model.
The Make American Shipbuilding Great Again (MASGA) initiative, formalized at the August 2025 U.S.-ROK leaders’ summit, translates that model into a bilateral framework. South Korean firms committed $150 billion in investment in American shipbuilding, defense supply chains, and maritime infrastructure. Hanwha’s acquisition of the Philadelphia Shipyard, the yard that built Iowa-class battleships and Essex-class carriers, represents the first Korean ownership of an American shipyard and a direct transfer of the Geoje model to American soil: smart-yard robotics, digital twin production management, advanced welding automation, and the institutional culture of on-time delivery that has defined Korean shipbuilding for decades.
Italy contributes a different but equally important dimension: multinational co-production. The FREMM frigate program, jointly developed with France since 2007, has produced 22 vessels operated by five Mediterranean navies. The Fincantieri model at Monfalcone where robotic and autonomous manufacturing systems developed for luxury cruise ship production are being directly applied to naval construction demonstrates that commercial and military shipbuilding can share an industrial ecosystem in ways that generate economies of scale unavailable to purely military-focused yards. Italy also provides a cautionary case study in the failed Constellation-class frigate program, where American procurement dysfunction overwhelmed a capable Italian industrial partner, producing cost overruns and delays that ultimately killed the program.
Canada brings Arctic sovereignty and icebreaker expertise, with the Canadian Coast Guard operating the world’s second-largest icebreaking fleet. Swedish shipbuilding, though diminished in volume, demonstrates how a small nation can maintain world-class industrial excellence in a strategic niche, the A26 submarine program, now being built for both the Swedish Navy and Poland, represents niche capability sustained through institutional will rather than scale. The United Kingdom provides the essential cautionary tale: a once-dominant maritime industrial power whose sustained underinvestment has produced a Royal Navy now smaller than the U.S. Coast Guard, with the near-bankruptcy of Harland and Wolff as the symbolic endpoint of a decades-long industrial retreat.
The Pier Review’s five case studies, read together, describe not a collection of bilateral arrangements but the rough architecture of a genuinely integrated allied maritime industrial network or the 21st-century Arsenal of Democracy.
Finland and the Arctic Dimension
The Pier Review treats Finland primarily as context for the Canada case study, a framing that understates one of the most strategically consequential allied industrial relationships now emerging.
Finland is not a supporting actor in the Arctic icebreaker story. It is the lead.
Helsinki Shipyard has built more than half of the world’s icebreakers. Since the 1930s, Finnish yards have produced vessels capable of operating in conditions that would destroy any ship built to conventional ice-class standards. That expertise, once directed partly toward the Soviet Union during the Cold War, is now turning decisively westward.
The Icebreaker Collaboration Effort — the ICE Pact — formalized as a trilateral MOU between the United States, Canada, and Finland in November 2024, and deepened by a bilateral U.S.-Finland agreement signed by Presidents Trump and Stubb in October 2025, is the most concrete expression of that reorientation. Under the arrangement, four Arctic Security Cutters will be built at Finnish yards, with designs and production knowledge then transferred to American shipyards, Bollinger Shipyards in Houma, Louisiana, for domestic production of up to seven additional vessels. Rauma Marine Constructions and Aker Arctic Technology are the Finnish industrial partners; Seaspan Shipyards provides the Canadian link.
The strategic logic is the same logic that runs through the entire Pier Review framework: where the American MIB lacks the capacity to deliver on timeline, allied industrial expertise provides the bridge. The first Finnish-built cutters will give the Coast Guard an operational Arctic presence within this decade; the technology transfer will give American yards the knowledge base to sustain and expand that presence over subsequent decades. The Polar Star, the U.S. Navy’s heavy icebreaker, is approaching 50 years of age; its engineers routinely cannibalize parts from the decommissioned Polar Sea to keep it operational.
The ICE Pact is not a luxury. It is an emergency response. The question is whether American policymakers have the institutional imagination to apply that template systematically across the full range of maritime capability gaps.
AUKUS and the Submarine Industrial Base
The nuclear submarine dimension of allied industrial reconstitution, the AUKUS partnership with Australia and the United Kingdom, represents the most ambitious expression of the distributed Arsenal of Democracy concept. The Virginia-class submarine program is the technological and industrial centerpiece of American undersea power; it is also chronically behind schedule, with backlogs that threaten to leave the submarine force below the numbers required for the operational commitments the Navy has undertaken.
AUKUS addresses this not by building new shipyards in Australia but by integrating the Australian and British submarine industrial bases into the American production and sustainment system. Austal USA’s memorandum of understanding with Australian Submarine Corporation, signed at the INDOPAC 2025 exposition in Sydney, advances additive manufacturing capability across the Virginia-class and Australian Collins-class programs simultaneously. A new 369,600 square foot module manufacturing facility, fully operational in late 2026, will be dedicated to submarine module production, with additive manufacturing techniques developed at Austal’s Additive Manufacturing Center of Excellence in Danville, Virginia, providing critical components that current casting and forging supply chains cannot reliably deliver.
The Pier Review study does not cover the nuclear submarine domain in depth, but the structural logic it articulates applies equally there. Labor shortages, supply chain fragility, outdated infrastructure, and the absence of the culture of delivery that Korean and Finnish yards have institutionalized, these are the same pathologies that afflict both surface shipbuilding and submarine construction. AUKUS is, in this sense, the submarine expression of the same allied industrial reconstitution that MASGA, the ICE Pact, and the FREMM model represent in other domains.
The Arsenal of Democracy, Reconceived
What distinguishes the current moment from previous periods of allied defense industrial cooperation is the convergence of urgency, institutional architecture, and strategic clarity. The strategic context is unambiguous: China’s shipbuilding capacity exceeds America’s by a factor of 200 in tonnage. Russia retains a submarine force capable of threatening critical undersea infrastructure. Iran’s challenge, actively contested in the naval domain as of 2026, has demonstrated that the American fleet’s readiness crisis is not theoretical. North Korea continues to develop missile-armed surface warships. The maritime threat environment has never been more complex or more simultaneous.
The institutional architecture is beginning to align with that threat environment. MASGA, AUKUS, the ICE Pact, the FREMM multinational production framework, the expanding network of Reciprocal Defense Procurement agreements, these are the structural components of a distributed maritime industrial system that no single adversary can match and no single point of failure can disable. South Korea’s chaebols bring production scale and automation sophistication. Finnish yards bring Arctic engineering mastery. Italian yards bring multinational co-production experience and the commercial-military technology crossover that American yards have largely abandoned. Canadian yards bring icebreaker expertise and Pacific Coast capacity that reduces pressure on already-strained American facilities. British yards bring AUKUS integration and Type 26 technology that is already being licensed across three allied navies.
The Pier Review study does not use the phrase ‘Arsenal of Democracy.’ It is a policy document, not a historical argument.
But the strategic logic it advances, examined in the context of MASGA, AUKUS, and the ICE Pact, points unmistakably toward that conclusion.
The American MIB cannot reconstitute itself alone in the time available. Allied industrial capacity, distributed, specialized, technologically sophisticated, and increasingly integrated through formal bilateral and multilateral frameworks, is the mechanism by which the democratic world can restore the maritime balance before the window to do so closes.
The challenge is not primarily industrial. The Korean yards, the Finnish shipbuilders, the Italian primes, the Canadian icebreaker designers — the expertise exists. The challenge is institutional: whether American procurement doctrine, Buy American restrictions, navy design processes notorious for late-stage changes, and a contracting culture that has normalized cost overruns can be reformed rapidly enough to allow allied capacity to flow into the gaps it could fill.
The Pier Review’s recommendations address these institutional barriers directly, firm-fixed-price contracting norms, digital twin adoption, additive manufacturing investment, joint procurement frameworks, but implementation requires political will that has historically been in shorter supply than the industrial expertise itself.
The democratic world’s maritime industrial reconstitution is underway. The question is whether it is moving fast enough and whether America’s institutional culture can adapt quickly enough to allow allied capacity to close the gaps before the adversaries who created them exploit them.
The Speed of the Challenge
George Washington’s observation that ‘without a decisive naval force we can do nothing definitive’ invoked in the foreword to the Pier Review by former Secretary of the Navy Kenneth Braithwaite was made about a different kind of alliance: the French fleet at Yorktown, decisive in the defeat of British naval power and therefore in the achievement of American independence.
The insight transcends its original context. Naval power, then as now, is the enabling condition of strategic outcome.
The arsenal of democracy that Roosevelt described in 1940 was built with extraordinary speed once the political will existed to build it. The Philadelphia Shipyard, the same facility now being reconstituted by Hanwha as the anchor of the MASGA initiative, built 48 warships during World War II and supported construction on over a thousand more. That capacity did not emerge from thin air. It was the product of industrial investment, workforce development, government-commercial alignment, and a national culture that treated shipbuilding as a strategic imperative rather than a procurement line item.
The Pier Review, the MASGA framework, the ICE Pact, and AUKUS together describe the architecture of a new such imperative, distributed across allied industrial ecosystems rather than concentrated in a single national effort, but animated by the same strategic logic. The Arsenal of Democracy is being rebuilt. The race is against time, against an adversary that has used the intervening decades to build an industrial base of staggering scale, and against the institutional inertia of systems not designed for the speed the current moment demands.
The allied maritime industrial network now emerging is the answer the democratic world has available. Whether it proves sufficient will depend on decisions being made now — in Washington and Seoul, in Helsinki and Canberra, in London and Rome — about the pace, the investment, and the institutional reform required to turn allied industrial potential into operational maritime power before the window to do so closes.