Adm. Karl L. Schultz assumed the duties as the 26th commandant of the U.S. Coast Guard on June 1, 2018. He previously served from August 2016 to May 2018 as commander, Atlantic Area, where he was the operational commander for all Coast Guard missions spanning five Coast Guard districts and 40 states. He concurrently served as director, Department of Homeland Security (DHS) Joint Task Force-East, responsible for achieving the objectives of the DHS Southern Border and Approaches Campaign Plan throughout the Caribbean Sea and Eastern Pacific Region, including Central America.

Prior flag assignments include director of operations (J3), U.S. Southern Command in Doral, Florida; commander, 11th Coast Guard District in Alameda, California; and director of governmental and public affairs at Coast Guard Headquarters in Washington, D.C.

Previous operational assignments include sector commander in Miami, Florida, as well as command tours aboard cutters Venturous, Acacia, and Farallon. His senior staff assignments include chief of the Office of Congressional and Governmental Affairs; congressional liaison to the U.S. House of Representatives; liaison officer to the U.S. Department of State, Bureau for International Narcotics and Law Enforcement Affairs; assignment officer at the Coast Guard Personnel Command; and command duty officer in the 7th Coast Guard District Operations Center in Miami.

A native of Connecticut, Schultz graduated from the Coast Guard Academy in 1983, earning a Bachelor of Science degree in civil engineering. In 1992, he was awarded a master’s in public administration from the University of Connecticut, and in 2006, completed a one-year National Security Fellowship at Harvard University’s Kennedy School of Government. He and his wife, Dawn, have five children: Kelsey, Lindsey, Annaliese, Eric, and Zachary.

His personal awards include the Coast Guard Distinguished Service Medal, Defense Superior Service Medal, four Legions of Merit, four Meritorious Service Medals, three Coast Guard Commendation medals, two Coast Guard Achievement Medals, and various other personal and unit awards.

 

Coast Guard Outlook: In an appearance at the Center for Strategic and International Studies this summer, shortly after taking command, you said the demand for Coast Guard services had never been greater. Which services did you have in mind when you said this – and what events or trends do you think are driving this demand?

Adm. Karl L. Schultz: Some of those events you can control, and some you can’t. For example, before Hurricane Matthew in 2016, we’d had about a decade without any major weather phenomena. Matthew was actually a bit of a tune-up for the Coast Guard. We had a lot of mid-grade folks who hadn’t done a whole lot of disaster response or hurricane response operations. On the heels of that, starting in August of 2017, we had one of the busiest, most challenging Atlantic Basin hurricane seasons in a long time, probably in my 35 years as a coastie. And then this year, we’ve had some pretty challenging large storms with Florence and Michael, two very different types of storms. So we’ve experienced sort of crescendoing requirements for capabilities and capacity in response to these kinds of natural disasters.

I would say for the Coast Guard, and for the nation, the Arctic is a competitive space. China has been up there every year since 2016 with their research vessel, the Xue Long 1. For almost a decade, they’ve been up there persistently establishing their claims, where there’s about 13 or 14 percent of the world’s untapped petroleum, about a third of the untapped natural gas. There’s about a trillion dollars of minerals.

There’s also a challenge ongoing in – I think my predecessor said it’s not a war on drugs, but really a campaign. It’s going to outlast my career and even my life. The Colombian government and the FARC [Revolutionary Armed Forces of Colombia] cut some deals to stop aerial eradication back in 2015, so there’s more coca being cultivated in Colombia right now than ever. So we’re in the thick of that fight. We’re pushing more Coast Guard capacity downrange, mostly in the Eastern Pacific, to thwart that. But there’s a large capacity conversation to be had here. High-demand and low-density assets are creating a little bit of risk for us in some locations, for fisheries enforcement and other missions, to support that counterdrug fight.

At the same time, the Arctic is upon us now as an operational area. And presence equals influence in the Arctic. We’re up there currently with the Coast Guard Cutter Healy, our medium icebreaker, supporting science work for a few different customers – the National Science Foundation, Office of Naval Research, and NOAA [the National Oceanic and Atmospheric Administration]. But outside of the Healy up there, the one heavy breaker we have in our inventory, the Polar Star, does its annual sojourn down to break out McMurdo Station [in Antarctica] and then she pretty much comes back and we patch her up to do that again next year. So we really have a limited amount of capacity to push into the Arctic, where there are expanding mission sets and expeditionary cruises. You’ve got gold mining going on out of Kotzebue, an evolving demand for Coast Guard services there. And it’s truly a competitive space. Our secretary of defense talks about cooperating where you can, and competing where you must – and competing vigorously where you must. I would say for the Coast Guard, and for the nation, the Arctic is a competitive space. China has been up there every year since 2016 with their research vessel, the Xue Long 1. For almost a decade, they’ve been up there persistently establishing their claims, where there’s about 13 or 14 percent of the world’s untapped petroleum, about a third of the untapped natural gas. There’s about a trillion dollars of minerals.

So there are a lot of different places consuming Coast Guard capacity here. On the global front, we’re supporting the combatant commanders – the COCOMs – at a pace we never have before. On any given day, the Coast Guard is contributing to the work of five of the six – sometimes all six – COCOMs. Fifteen, 17 years ago, these operations were funded through about $340 million in non-discretionary Department of Defense [DOD] funding that went to what we call the 050 account: Coast Guard operations in support of DOD. That’s closer to about a billion dollars today, probably about $850 million to $900 million. So we’re pushing more Coast Guard capacity to support the COCOMs across the globe.

So when you roll that all up, to me that’s an unprecedented demand signal for Coast Guard services: supporting our own department and the combatant commanders in the Department of Defense. We’re really protecting the United States’ global influence here, because the maritime domain is so important to the prosperity of the nation.

You mentioned a “crescendo” in the demand for operational capacity during the past two hurricane seasons. Has the Coast Guard had to adjust the way it responds to destructive storms of this size?

I think a lot has changed. I was the Atlantic Area commander when Hurricane Harvey kicked off the 2017 season. We were watching it closely, and it looked like it was disaggregating off the coast of Mexico. But it picked up some force and it turned into two sort of separate events: a fast-moving, high-impact wind event with a lot of devastation, where it made landfall near Roberts, Texas, and a sustained, devastating flooding event around the cities of Houston and Beaumont, with 52 inches of rain – the equivalent of the area’s annual rainfall – in about 36 to 48 hours. The forecasting was very good on that storm, and we were told this thing might become a slow-moving water event when it got a little bit inland. And that’s exactly what it was. So we anticipated the need for urban SAR [search and rescue].

The Coast Guard’s major contribution to border security is the away game. It’s pushing the maritime border 1,500 miles from American shores, interdicting those illicit narcotics that come out of the transit zone countries and make their way by ocean to Central America.

And when you start to look at how we’re postured with forces, we’ve got three Dolphin helicopters in New Orleans and three in Houston. We needed more lift. So, we brought in bodies from as far away as Alaska and Hawaii, and brought helicopters from our seasonal air facilities in the Great Lakes and from as far away as Cape Cod. We went down to one helicopter there to make one helicopter for the Harvey response, and took some risk there, anticipating a large surge of forces – and that’s exactly what it shook out to be.

We were well positioned, and I think Harvey changed our thinking. But because the weather forecasting is so good in the modern era, we took the event seriously and planned ahead. And I think it translated to a pretty successful response, rescuing over 11,000 people. I think we’re leaning in more than we ever did to make sure we don’t come up short, in terms of resources and the ability to respond – that bias for action. I’d rather overshoot with too much capacity on scene, and walk it back, than come late to the need.

 

You also mentioned that pushing assets down into the Eastern Pacific for counterdrug operations creates some risk, by subtracting from capacity elsewhere. How do you hope to continue to surge capacity into drug and migrant interdictions while managing that risk?

When you talk about border security, what unfolds at our Southwest border is sort of a home game and an away game. The Coast Guard’s major contribution to border security is the away game. It’s pushing the maritime border 1,500 miles from American shores, interdicting those illicit narcotics that come out of the transit zone countries and make their way by ocean to Central America. We have the ability to break the chain of corruption and violence that lies behind that, and keep those drugs from landing in [Central America], where it’s disaggregated into smaller loads bound for the United States.

I think the Smilax now [a 100-foot construction tender, commissioned in November 1944] is almost 74 years old. The average age of the inland fleet is more than a half-century old. So, it’s about time to start replacing these vessels and do right by our men and women doing the missions.

But we’re also doing all of that a little differently. We’re in the second phase of a multilateral effort with Colombia and Mexico and about 11 or 12 of the Central American countries, where the Colombians and Mexicans are taking some leadership. The Colombians are adding additional capacity, with their marines, to have some impact in what we call the “fluvial region,” the rivers down there. If you can stymie the drugs from getting out off the coast, that’s another way to squeeze the balloon for effect, and take some pressure off at-sea interdiction. So, we’re going to continue to work multilaterally, in the international front, while we focus on our organic Coast Guard capabilities.

 

Let’s talk about some of those organic capabilities. The Coast Guard’s fleet recapitalization strategy calls for the construction of a heavy icebreaker – but that account was raided in a recent House committee markup in order to transfer funding to construction of a border wall. Where do things stand now with the heavy icebreaker?

We are guardedly optimistic. We’re under a continuing resolution, like most of the other parts of the federal government, until Dec. 7. But the president asked in the 2019 budget for a $750 million line item for the heavy icebreaker, which we’re now referencing as the “polar security cutter.” The Senate, in their markup, included that, but the House went in a little different direction, trying to give the president more money toward the wall. There’s a lot of discussion going on … and I’m guardedly optimistic about buying the Coast Guard its first heavy icebreaker in more than four-and-a-half decades.

 

Why do you think it’s important to call it a polar security cutter? Do you envision it as something different from the Polar Star?

Right now, what’s different is simply the nomenclature. The Coast Guard resides in the Department of Homeland Security. And the term polar security cutter resonates better within our own department, because we’re projecting U.S. sovereign influence. I mentioned that presence equals influence in the Arctic, and when you’re not there and others are there, you open yourself up to the “constructive presence” argument that countries like China – which recently declared itself a “near-Arctic state” – make. China’s investing in the Arctic. They’ve just built their second research vessel, the Xuelong 2, and they’ve got designs to build a heavy icebreaker.

So, it’s a place where we absolutely need to be. The mission has evolved so that you need to break ice to get to the mission, and just being there and accessing the Arctic is a projection of national sovereignty. It’s a national security mission, and we felt the name of the vessel ought to reflect that.

 

The Coast Guard recently issued a couple of Requests for Information (RFIs) to shipbuilders to investigate the design of what it’s calling the waterways commerce cutter, which will replace a fleet of inland river vessels that vary widely in age, size, and purpose. Is the waterways commerce cutter going to be one multipurpose vessel, or will it appear in maybe a few different configurations?

Those are the exact questions we’re asking. There have been a couple of RFIs to begin discussions of what kind of vessel you would use to replace these Coast Guard vessels. The Army Corps [of Engineers] has a vessel operating in the vicinity of St. Louis that they built a couple of years back, and we’re looking at how that prototype proof-of-concept vessel might align with our needs.

I think the waterways commerce cutter needs to be fairly modest in its requirements. We do have a hodgepodge of an inland fleet. We have 160-foot construction tenders. We have 100-foot river tenders. We have 75-foot tugs that push bigger barges … I think we are looking for a standard configuration, a basic baseline hull form. Maybe there’s a barge component that gets added on for use in some locations. That’s the subset these various RFIs are shaping right now.

The OPC is envisioned as a fleet of 25, and we hope to splash the first one in 2021, and have it operational within a year or year-and-a-half. In terms of pace, once we get past the initial production of the first couple of hulls, we’re hoping to do two ships a year.

There is high interest from the Congress on this waterways commerce cutter initiative. We’ve got a $25 million above-asked level of funding in the 2018 omnibus, and I think that sends a pretty clear signal that folks are interested in replacing these. I think the Smilax now [a 100-foot construction tender, commissioned in November 1944] is almost 74 years old. The average age of the inland fleet is more than a half-century old. So, it’s about time to start replacing these vessels and do right by our men and women doing the missions. But we’ve got to work those details out, exactly what baseline platform is going to best serve our interests and how we work around that to meet some of the various requirements.

 

Are you happy with the rate of production for the offshore patrol cutter (OPC)? Some of the 210- and 270-foot medium-endurance cutters they’re replacing are 60 years old or so. If you’re acquiring a fleet of 25 at a rate of one and then two a year, is it going to be less cost-effective in terms of maintaining and retrofitting those older cutters?

That’s a fair question. We just awarded the contract for the first offshore patrol cutter, and a long lead-time on the second; I think it was Sept. 28. The OPC is really the mainstay of our deep-water fleet. We have funding through 11 national security cutters … and 58 fast response cutters, FRCs – and actually a bit beyond that, now that Congress has provided funding to recapitalize those patrol boats operated by our Patrol Forces Southwest Asia.

The OPC is envisioned as a fleet of 25, and we hope to splash the first one in 2021, and have it operational within a year or year-and-a-half. In terms of pace, once we get past the initial production of the first couple of hulls, we’re hoping to do two ships a year. When you put the cost of an OPC into the Coast Guard capital account, that’s about what we have the ability to manage as we’re building – hopefully – a polar security cutter and finishing up the fast response cutters. We’ve got to make some investment in rotary- and fixed-wing aviation down the road.

So, we’ll look at possibly a service life extension [SLEP] on some of the 270s [Famous-class medium-endurance cutters] – it won’t be the entire fleet of 13 270s, but we’ll do a SLEP on some of those. The 210s [Reliance-class medium-endurance cutters] are 50-plus years old now, but we’re managing to keep them running. The mission support side of the Coast Guard is averaging about 92 percent availability on our major cutter fleet, and that is pretty remarkable on half-century-old ships. I’m confident we’ll be able to bridge that gap. Is it ideal? Maybe not. But it’s probably where we are going to be.

 

This is the first year of your tenure, and your “Commandant’s Strategic Plan” is going to be coming out this month. Do you want to provide a preview of your top priorities?

I think the No. 1 priority for my tenure here will be service readiness. And there are many aspects of that. There’s a people aspect: We’re less than 42,000 active-duty end strength. We’re at about 6,200 reservists. An immediate need is to grow that Reserve force up to our authorized 7,000. We’ve got to lean in on that.

I’m not saying everybody needs to stay in and be a 20-plus-year coastie, but I’d like that to be a tough choice. I want to be an employer of choice with people who want to serve their nation and stay associated with the Coast Guard brand.

I’ve talked about a Coast Guard that is more representative of the society we serve, so we need to focus on diversity and inclusion. We need to be drawing the best from America’s pool of talent. It’s a competitive field out there for recruiting. Unemployment is 3.7 percent. We just entered a new era called the blended retirement system, and we’ve had probably the highest rates of any of the services in both officer and enlisted retention … but if we’re not investing in people seeing the Coast Guard as a career where we create opportunities for them to develop personally and professionally, and where we take care of them and their families, they’ll vote with their feet and pursue other options. And if they’re good investors and they came in under the blended retirement model, they’ll take some money with them. I’m not saying everybody needs to stay in and be a 20-plus-year coastie, but I’d like that to be a tough choice. I want to be an employer of choice with people who want to serve their nation and stay associated with the Coast Guard brand.

We’ve got to keep pilots in, too. There is a huge sucking sound in the civilian aviation sector. For the next 10 years, that’s going to draw 20,000 pilots in, and the military is losing pilots. And we’re not exempt from that in the Coast Guard, particularly our fixed-wing pilots.

We need to continue the momentum on recapitalizing with steady, predictable, stable funding. If we can be at about $2 billion a year, I think we can continue to really march down the field and make good headway. At the end of the day, the acquisition part of the budget has been funded fairly steadily and solidly.

My biggest concern, in terms of readiness, is the operation side of our budget. We’re seven years into this Budget Control Act. After 2011, when it was enacted, we lost 10 percent of our purchasing power in the operating side of the budget. We’ve been flatlined, even a bit decremental. When the president came into office, he signed a national security memo that talked about restoring readiness for the armed forces. DOD achieved about a 12 percent bump in their O&S [operations and support] over 2017 and 2018. We were outside of that, being the armed force that is in DHS – in the nondefense, discretionary part of the budget.

We had about a 4 percent uptick in our O&S funding in 2017 and 2018, and the 2019 budget estimate submitted by the president is about 1.8 percent, which really is short of where we need to be. To me, success looks like 5 percent steady growth on the operations and support side of the budget. If we can get there, I can deliver to Secretary [Kirstjen] Nielsen, our Homeland Security secretary. I can deliver to the combatant commanders. I can help the administration, writ large, put Coast Guard goodness out there as a check against other global maritime influences. So, there are plenty of challenges out there, but really my No. 1 priority is readiness.

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This article was originally published in Coast Guard Outlook 2018 – 2019 By Faircount, LLC