Another Anti-Jones Act Article


#41

I’m not an economist, but I can totally see a benefit to 33+% of vessels engages in foreign trade being US flagged, built, and manned being beneficial to the economy. The construction of the vessels provides jobs, the manning of the vessels provides jobs, and the commerce in which they engage will creat support, technical, and logistical jobs on shore. Cal me an idealist, but I see no reason why a 100% shipping company can’t be successful. Not saying Matson will turn into a giant conglomerate like Masrsk, but at the very least I believe they can be successful and benefit the economy.


#42

[QUOTE=tugsailor;133962]Let me ask a question.

Would the US economy be better off, if a reasonable portion of the goods in US FOREIGN TRADE (goods coming from or going to foreign countries), say 33 percent, were required to be carried on US built, flagged, and manned ships?[/QUOTE]

I don’t think the economy would not feel a thing. Corporate profits however would be lower especially for Walmart and Target!


#43

No such animal as lower corporate profits, only higher consumer costs. That’s the way it always has been and the way it always will be.


#44

I am not an economist either, but I think the cost of foreign made goods and US exports might increase by about 2 percent.

However, it would create a lot of jobs and just might jumpstart the economy again.


#45

I’m not a mafia boss but I did stay at a Motel 6 last night


#46

In no parallel universe, or this one, will the federal government ever require 33% of everything coming and going from our shores to be on domestically flagged, owned, built and crewed ships, or any combination of the above. We’re barely clinging to the protectionism we have now, the economic shock, and the subsequent blowback, would be unsurvivable for the industry. There’s no sense in beating around the bush and trying to justify our economically unstable existence. No one in this industry can possibly be in denial about the fact that American ships and crews are more expensive. If that is truly the case then how can anyone deny that there is an added cost to shipping American? That cost is translated directly to the consumer and would send the economy into a tailspin. This is simple economics. If anyone really thinks that the Jones Act, or anything like it, doesn’t have a negative effect on doing business then I would encourage them to check how many American ships there are left. If it doesn’t make business sense: it ain’t happening. Protectionism does NOT make business sense. There is no economic interest in keeping the Jones Act around, there only remains the security concerns of not having a viable sealift capacity in a national emergency. If you like the Jones Act then you better pray for the next war, because that’s the only thing keeping us in the flush.


#47

Once again, what about say…Canada…that does the same thing? Yes not everything is Canadian built, but definitely Canadian crewed. I doubt they are paid less…correct me if I am wrong.

Do other countries on the whole employ the FOC on coastwise traffic? Not talking foreign trade but between coastwise ports. Something difficult to research on a phone.


#48

[QUOTE=PaddyWest2012;133993]In no parallel universe, or this one, will the federal government ever require 33% of everything coming and going from our shores to be on domestically flagged, owned, built and crewed ships, or any combination of the above. We’re barely clinging to the protectionism we have now, the economic shock, and the subsequent blowback, would be unsurvivable for the industry. There’s no sense in beating around the bush and trying to justify our economically unstable existence. No one in this industry can possibly be in denial about the fact that American ships and crews are more expensive. If that is truly the case then how can anyone deny that there is an added cost to shipping American? That cost is translated directly to the consumer and would send the economy into a tailspin. This is simple economics. If anyone really thinks that the Jones Act, or anything like it, doesn’t have a negative effect on doing business then I would encourage them to check how many American ships there are left. If it doesn’t make business sense: it ain’t happening. Protectionism does NOT make business sense. There is no economic interest in keeping the Jones Act around, there only remains the security concerns of not having a viable sealift capacity in a national emergency. If you like the Jones Act then you better pray for the next war, because that’s the only thing keeping us in the flush.[/QUOTE]

There is an economic interest in keeping the Jones Act around. It keeps all others out of our courts, which is exactly what shipping companies are deathly afraid of. Remember ridding the Jones Act does nothing to stop the attorneys from pouncing on any little injury for millions. And insurance companies from raising the rates. THINK about Safety First, where did that come from? Anyway, if the Jones Act did go away, american mariners could become highly sought after due to our nationality and familiarization of USCG rules. The only companies that can survive a big blunder in an American court are the foreign drilling companies. We might be more expensive up front, but in the long run a better risk and potentially a bigger savings.


#49

[QUOTE=z-drive;133996]Once again, what about say…Canada…that does the same thing? Yes not everything is Canadian built, but definitely Canadian crewed. I doubt they are paid less…correct me if I am wrong.

Do other countries on the whole employ the FOC on coastwise traffic? Not talking foreign trade but between coastwise ports. Something difficult to research on a phone.[/QUOTE]

What is the strength of the Canadian merchant marine? How many ships do they have in their register? Irving tankers don’t count, those are flagged in the Marshall Islands and crewed by mostly Filipinos, aren’t they? Canada just isn’t a good example. The only countries that have strong domestic merchant fleets are the ones whose merchant fleets are heavily subsidized by socialist governments and subsequently price-gouge every other fleet in the world. It’s a loosing game for a lot of other countries, not just us.


#50

[QUOTE=seacomber;133997]There is an economic interest in keeping the Jones Act around. It keeps all others out of our courts, which is exactly what shipping companies are deathly afraid of. Remember ridding the Jones Act does nothing to stop the attorneys from pouncing on any little injury for millions. And insurance companies from raising the rates. THINK about Safety First, where did that come from? Anyway, if the Jones Act did go away, american mariners could become highly sought after due to our nationality and familiarization of USCG rules. The only companies that can survive a big blunder in an American court are the foreign drilling companies. We might be more expensive up front, but in the long run a better risk and potentially a bigger savings.[/QUOTE]

Obviously the Jones Act protects the economic interests of the shipping industry but take a good look at our domestic shipping industry: It’s weak, feeble, and almost non-existant. I won’t deny that several companies would fold and many people (myself included) would be put entirely out of work as a result of the loss of the Jones Act, but do you know how long the national economy would trouble over the implosion of the domestic shipping industry? Not even half a nano-second. We’re not riding the back of this economic bus, they’ve got us clinging to the undercarriage! There might have been a compelling argument 40 or 50 years ago for what devastation might be wrought at the elimination of the Jones Act, but take a good look around, that devastation has come and gone. We are a gutted carcass of an industry and we’re the only ones who will miss us when we’re gone, that is until the day comes when the nation needs us again and we’re not around to save the day.


#51

[QUOTE=PaddyWest2012;133999]Obviously the Jones Act protects the economic interests of the shipping industry but take a good look at our domestic shipping industry: It’s weak, feeble, and almost non-existant. I won’t deny that several companies would fold and many people (myself included) would be put entirely out of work as a result of the loss of the Jones Act, but do you know how long the national economy would trouble over the implosion of the domestic shipping industry? Not even half a nano-second. We’re not riding the back of this economic bus, they’ve got us clinging to the undercarriage! There might have been a compelling argument 40 or 50 years ago for what devastation might be wrought at the elimination of the Jones Act, but take a good look around, that devastation has come and gone. We are a gutted carcass of an industry and we’re the only ones who will miss us when we’re gone, that is until the day comes when the nation needs us again and we’re not around to save the day.[/QUOTE]

You’re just full of shit on this one. Yes our deepsea coastwise trade fleet has been terribly neglected for many decades but is rebounding now every day with new construction and the US maritime workboat sector had never been larger, healthier or more profitable. All are covered as part of Jones Act protected trades.

Now cease and desist with your declaring doom upon our heads…I COMMAND YOU!


#52

With all the new IMO, MLC 2006, and IACS class requirements. The playing field is becoming much more level. Everyone has basically the same fuel cost. I doubt that there is much difference in insurance costs. no matter the flag of the ship, every container of freight has the same longshore costs. The biggest difference is building cost, but US flag ships in foreign trade can be built anywhere, so there is no difference there either. The cost of crew is a tiny portion of the overall freight tariff. I doubt that it would add one dollar to the cost of a $100 item at Walmart.

Other than the extra cost of building US, I don’t see any significant cost savings to shippers if they Jones Act were repealed. What about the extra cost for all those state licensed pilots, and all those extra customs and immigration fees that would be required by foreign ships, if they could engage in the US coastwise trade? There is no genuine economic reason to make any changes.


#53

[QUOTE=c.captain;134003]You’re just full of shit on this one. Yes our deepsea coastwise trade fleet has been terribly neglected for many decades but is rebounding now every day with new construction and the US maritime workboat sector had never been larger, healthier or more profitable. All are covered as part of Jones Act protected trades.

Now cease and desist with your declaring doom upon our heads…I COMMAND YOU![/QUOTE]

Somebody’s gotta keep an eye on the piggy bank even if it means raising unpopular opinions. There is no debate about the fact that this industry has problems, and they’re big fat financial ones. Even if the Jones Act doesn’t go away, this business must always strive in everything it does to keep costs as low as possible in the interests of making us ever more attractive both at home and abroad.


#54

[QUOTE=z-drive;133996]Once again, what about say…Canada…that does the same thing? Yes not everything is Canadian built, but definitely Canadian crewed. I doubt they are paid less…correct me if I am wrong.

Do other countries on the whole employ the FOC on coastwise traffic? Not talking foreign trade but between coastwise ports. Something difficult to research on a phone.[/QUOTE]

I think you are right. Canada allows foreign built vessels in their coastwise trade. I think that they generally must be Canadian flag. They definitely have to be Canadian crewed. Canada does allow some foreign flag OSVs to come in, but they must be Canadian crewed within a fairly short period of time.

I am out of date on Canadian tug wages, but last time that I had some info, the Canadians were paid more than we are on the West Coast, but a little less on the East Coast. The have a pretty decent maritime union called “The Guild.”


#55

[QUOTE=tugsailor;134007]With all the new IMO, MLC 2006, and IACS class requirements. The playing field is becoming much more level. Everyone has basically the same fuel cost. I doubt that there is much difference in insurance costs. no matter the flag of the ship, every container of freight has the same longshore costs. The biggest difference is building cost, but US flag ships in foreign trade can be built anywhere, so there is no difference there either. The cost of crew is a tiny portion of the overall freight tariff. I doubt that it would add one dollar to the cost of a $100 item at Walmart.

Other than the extra cost of building US, I don’t see any significant cost savings to shippers if they Jones Act were repealed. What about the extra cost for all those state licensed pilots, and all those extra customs and immigration fees that would be required by foreign ships, if they could engage in the US coastwise trade? There is no genuine economic reason to make any changes.[/QUOTE]

I’ll have to check but I think MARAD’s 2011 report on the financial health of the industry would disagree with a lot of those assertions. I’ll get back to you on that one.


#56

You added some interesting points there. Figuring out how much the prices would increase at Walmart. I actually wonder if that is calculable. Would be interesting to find out.
Anyways, I for the time being, at least, like c.captain has stated, there IS a lot of builds going on unlike previous years. (By the way, what ever happened to the Arvik? Did they unfuck all of those teething problems I read about a while back? )
Guess it’s a wet dream of mine, but I would just live to see the money (correct me from wrong, but i think the original projected proce of $8 BIL wound up being double that) allocated to the new Ford-class “mega carriers” be used instead to revamp civilian ship building in this country. How sweet would that be!


#57

[QUOTE=MandolinGuy;134012]Guess it’s a wet dream of mine, but I would just live to see the money (correct me from wrong, but i think the original projected proce of $8 BIL wound up being double that) allocated to the new Ford-class “mega carriers” be used instead to revamp civilian ship building in this country. How sweet would that be![/QUOTE]

Especially considering I’m not really sure just how badly we needed a new class of Carrier. We already have way more carriers than the next guy (and probably the next two after that combined…) and the ones that we do have are in pretty good shape and still going strong. Even at US prices, just imagine how many marine transportation projects could have been completed with that money. Everything from shipbuilding subsidies to MARAD’s beloved marine highway and intermodal transportation project would have been possible. Oh what a renaissance we could have had! Of course the other problem with all that is that going on the government dole is a rather unsporting way to go about it…


#58

[QUOTE=tugsailor;133962]Let me ask a question.

Would the US economy be better off, if a reasonable portion of the goods in US FOREIGN TRADE (goods coming from or going to foreign countries), say 33 percent, were required to be carried on US built, flagged, and manned ships?[/QUOTE]

That is probably the single most pie in the sky # I’ve ever seen posted on this forum. We couldn’t even force the hand of just Asian car makers to deliver 10% of the autos they ship here on standard US flag ships. The hope for containerized goods is far less. Doesnt matter anyway, because we have nowhere enough sufficiently credentialed mariners to handle half of your figure.

The Walton family would squash any such attempt with a simple text msg to the right person without even having to leave Bentonville.

And BTW, there is a Maersk Bentonville. Saw it leaving English Channel a few years back. The power of the retailers alone is certainly not to be underestimated.


#59

This one third proposal was discussed years ago. It didn’t go anywhere then and it probably would not go anywhere now. The theory is that bilateral treaties between trading partners could give the exporting and importing countries each one third of the freight on their own flag ships and agree to drop import duties. It would leave the other third of the freight open to anyone.

The retailers pay basically the same price per box no matter what the flag of the carrier or the nationality of the crew. Why should they care?

The foreign flag shipowners are the ones who should care. But why should Congress care about them?


#60

[QUOTE=tugsailor;134019]This one third proposal was discussed years ago. It didn’t go anywhere then and it probably would not go anywhere now. The theory is that bilateral treaties between trading partners could give the exporting and importing countries each one third of the freight on their own flag ships and agree to drop import duties. It would leave the other third of the freight open to anyone.

The retailers pay basically the same price per box no matter what the flag of the carrier or the nationality of the crew. Why should they care?

The foreign flag shipowners are the ones who should care. But why should Congress care about them?[/QUOTE]

You’re right, Congress doesn’t care about the shippers, but they do care about what their super wealthy constituents want.

I would find it very hard believe in today’s global economy that some of these retailer’s owners (especially the large ones) are not also invested in these shipping companies. So, that would mean those persons do care about the profit margin of Hanjin, NOL, Yang Ming, Maersk, etc.

The super wealthy don’t get or stay rich by being dumb and uninformed. As much as those companies have been importing crap to put on the shelves for decades now, I’m sure they are very knowledgeable about the world of commercial, seaborne trade.

And the last thing govt supported Chinese shipping wants is bilateral, unilateral trade with anybody, let alone the US.
I don’t know that it can be found anywhere, but I’ll bet a huge percentage of what we ship to AsIa is, unfortunately, empty containers.

Just found it, NY Times Article 2006 referencing 2005 study:
Asia to NA trade: 60% of boxes return empty. A lot of those loaded boxes going back west are loaded with trash, bulk paper waste, scrap metal, bales of hay, and cotton, and for much lower rate per TEU than their original eastbound journey. $400 vs $1400.