Re: 1956 Johson 5.5hp CD-13 A
It is not normal, but it is fairly common. There is an o-ring around the shifter shaft and if it leaks it will blow water through. Could be the o-ring is shot or could be that the hole that it fits in is worn and loose.
Will it hurt anything? Well, it will wash the grease out and that will cause even more wear over a long time. But it won't affect the use of the motor for right now.