The Navy has a new civilian leader with a hefty business resume but no military experience after the Senate voted Monday evening to approve John Phelan as the service's secretary.
The Senate voted 62-30 to confirm Phelan as Navy secretary, making him the civilian head of both the Navy and Marine Corps and putting him in charge of the health and well-being of more than 1 million sailors, Marines, reservists and civilian personnel and an annual budget of more than $250 billion.
While Phelan's lone connection to military policy prior to being nominated by President Donald Trump was working with a nonprofit organization that supports U.S. troops, the lack of experience ultimately did not prove to be a liability in the confirmation process.
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Along with 51 Republicans, 11 Democrats voted to support Phelan including Senate Armed Services Committee ranking member Sen. Jack Reed, D-R.I., and fellow committee Democratic Sens. Tim Kaine of Virginia, Mark Kelly of Arizona, Jacky Rosen of Nevada and Jeanne Shaheen of New Hampshire.
During his confirmation hearing, Phelan sought to frame his business experience as an asset to help turn around long-standing issues with Navy shipbuilding and other budget woes.
"I understand why some may question why a businessman who did not wear the uniform should lead the Navy," he said in his opening statement at last month's hearing. "I respect that concern. The Navy and the Marine Corps already possess extraordinary operational expertise within their ranks. My role is to utilize that expertise and strengthen it, to step outside the status quo and take decisive action with a results-oriented approach."
Phelan's professional background is as an investment banker. Prior to becoming Navy secretary, he was the chairman of Rugger Management LLC, an investment firm he founded. Before that, he co-founded and was managing partner of MSD Capital, the private investment firm for Michael Dell, founder and CEO of Dell Technologies.
Phelan was also a major donor to Trump and Republicans in the 2024 elections. Among other political donations, he contributed $834,600 to Trump's joint fundraising committee in April, and days after the election, on Nov. 10, chipped in another $93,300, Federal Election Commission records show.
He also sat on the board of a nonprofit called Spirit of America, which, according to its website, has "an agreement with the Department of Defense that allows U.S. troops to collaborate with us to build goodwill and deliver assistance at scale."
While most senators brushed off his lack of military experience, some Democrats questioned whether his professional history presented a conflict of interest.
"Given your financial investments in defense contractors and the Trump transition's emphasis on your 'business-minded' orientation, I am concerned that you will enter this role with serious conflicts of interest," Sen. Elizabeth Warren, D-Mass., a member of the Armed Services Committee, wrote in a letter to Phelan earlier this month urging him to make stronger divestments and recusal commitments than required by law.
Still, others expressed optimism that his business experience could help the Navy finally right shipbuilding programs that have run years over schedule and billions of dollars over budget.
"You're a nontraditional appointee for this position, and that can be OK if the tradition is not working," Kaine said at the hearing last month.
