Puerto Rico - Statehood and attack on the Jones Act


#21

Same reason that Mitt Romney campaighned in Puerto Rico and got the Governor to endorse him. Seeking any and all Hispanic votes in the stats.


#22

[QUOTE=tugsailor;171911]Puerto Rico is spending all of its political capital on an effort to persuade Congress to amend the bankruptcy laws to make it possible for Puerto Rico to declare bankruptcy. Puerto Rico can never repay it huge debts. It either needs to go bankrupt or get us taxpayers to bail them out.[/QUOTE]
The “them” to be bailed out in this case are the hedge funds and banking geniuses that loaned the money to Puerto Rico. You remember those too big to fail guys that run the USA. Puerto Rico will NOT be allowed to go bankrupt and get out of paying those guys back but the USA taxpayer may well be on the hook for paying back the hedge funds and banks. We certainly can’t have them lose money! They get rich on privatized profits and socialized losses.


#23

[QUOTE=Carruthers;171937]1)

  1. What to do? Well, the bond holders’ puppets in the financial press have floated several ideas for how to do a bailout without calling it a bailout. Exempting Puerto Rico from the Jones Act shipping requirements is on the list:

https://www.moodys.com/research/Moodys-US-initiatives-could-help-Puerto-Ricos-fiscal-recovery-and--PR_336760

http://blogs.barrons.com/incomeinvesting/2015/10/15/a-few-ways-the-u-s-can-help-puerto-rico-out-of-fiscal-crisis/

http://www.bloomberg.com/news/articles/2015-10-14/seven-ways-congress-can-help-solve-puerto-rico-s-debt-crisis

http://www.chicagotribune.com/news/sns-wp-blm-puertorico-policy-da13354a-7284-11e5-ba14-318f8e87a2fc-20151014-story.html

Note that exempting Puerto Rico from the Jones Act is also being promoted by Republican thinks tanks Heritage Foundation and Manhattan Institute. And Republican Senator Charles Grassley – who is handling the Puerto Rico rescue likes the idea. As does Republican Big Oil.

.[/QUOTE]

I believe the “Jones Act” they are talking about is part of the Jones-Shafroth Act of 1917, not the Jones act concerning merchant shipping more properly known as the Merchant Marine Act of 1920.


#24

[QUOTE=tengineer1;171991]I believe the “Jones Act” they are talking about is part of the Jones-Shafroth Act of 1917, not the Jones act concerning merchant shipping more properly known as the Merchant Marine Act of 1920.[/QUOTE]

No, they are talking about giving Puerto Rico an exemption from the requirement that PR imports and exports have to handled by American ships only.
Look at the articles.

If it passes, I imagine Hawaii and Alaska will demand the same. Then the Big Oil guys in Houston, Texas. Camel nose in the tent, as it were.


#25

[QUOTE=Carruthers;171993]No, they are talking about giving Puerto Rico an exemption from the requirement that PR imports and exports have to handled by American ships only.
Look at the articles.

If it passes, I imagine Hawaii and Alaska will demand the same. Then the Big Oil guys in Houston, Texas. Camel nose in the tent, as it were.[/QUOTE]

I think PR imports and exports to and from the USA only have to be handled by US ships. But even were that rule lifted does anyone really think prices will drop and solve PR woes?
The hedge funds and the lads at Golden Sacks need to eat their losses like grown-ups. They made bad bets thinking the taxpayers would cover them because…they usually do.


#26

[QUOTE=tengineer1;171991]I believe the “Jones Act” they are talking about is part of the Jones-Shafroth Act of 1917, not the Jones act concerning merchant shipping more properly known as the Merchant Marine Act of 1920.[/QUOTE]

All four of the articles mention the Jones Act and talk about how Puerto Rico is FORCED to use U.S. Shops for ALL of their needs. We all know that they do not need to use U.S. ships for anything that comes from a Foreign port. But to the AVERAGE person on the street, all they read is how EVERYTHING has to be shipped on U.S. Bottoms.


#27

[QUOTE=tengineer1;171994]I think PR imports and exports to and from the USA only have to be handled by US ships. But even were that rule lifted does anyone really think prices will drop and solve PR woes?
The hedge funds and the lads at Golden Sacks need to eat their losses like grown-ups. They made bad bets thinking the taxpayers would cover them because…they usually do.[/QUOTE]

A long time ago my Union Rag had an article from PE that had just purchased and new Truck. As it turned out a friend his purchase a ruck that was nearly identical to his.

The PE’s truck was built in Mexico, while his friends was built in the States. He posted window stickers and Low and Behold there was no price difference. This was the first year for these trucks being built in Mexico, so if as they said (for $$$ Savings) either the Mexico built truck should have been cheaper, or Both should have been. The Truth is the Price had gone up as usual.

So, we all know all these Corporations care about is Paying the Stock Holders and lining their pockets!


#28

[QUOTE=tengineer1;171994]I think PR imports and exports to and from the USA only have to be handled by US ships. But even were that rule lifted does anyone really think prices will drop and solve PR woes?
The hedge funds and the lads at Golden Sacks need to eat their losses like grown-ups. They made bad bets thinking the taxpayers would cover them because…they usually do.[/QUOTE]

And if you guys can cough up $1 million in campaign donations, I am sure someone in Congress would be happy to take your money and listen to your argument.

Some points based on reading the above articles:
a) Puerto Rico is near a financial collapse
b) The normal case of political inertia and prolonged quarreling doesn’t apply here – if you guys are going to be screwed, it will be soon
b) Puerto Rico residents can NOT even vote in US elections but by a strange quirk, the PR emigrants to Florida may have the power to decide who gets Florida’s big pot of electoral votes next year – and possibly decide who gets the US Presidency
c) But ANY relief PR gets has to be between now and the Nov 2016 --because after that they turn into a pumpkin and will have no political power for
at least four years to the next election. Everyone in PR from the governor on down knows that.
d) Similarly, US politicans and US oligarchs wanting to cut a deal with the PR oligarchy have to do soon in order to get any benefit from the PR swing voters in Florida.


#29

[QUOTE=Tugs;172006]A long time ago my Union Rag had an article from PE that had just purchased and new Truck. As it turned out a friend his purchase a ruck that was nearly identical to his.

The PE’s truck was built in Mexico, while his friends was built in the States. He posted window stickers and Low and Behold there was no price difference. This was the first year for these trucks being built in Mexico, so if as they said (for $$$ Savings) either the Mexico built truck should have been cheaper, or Both should have been. The Truth is the Price had gone up as usual.

So, we all know all these Corporations care about is Paying the Stock Holders and lining their pockets![/QUOTE]

Yes this is so true, eliminating the Jones act would only lower the price of a can of soup one or two pennies at most. The rest of the money would go straight to corporate profits, and a bunch of good American mariners would be out of a job. Not one thing else would get accomplished. Wonder who they will blame Puerto Rico’s financial mess on then?


#30

Geez, I would love to see every member of congress and extended family shipped to Puerto Rico on a FoC rustbucket with a SE Asian crew and forced to live there for a year on what that crew makes.


#31

Don’t listen to know nothing alarmists spouts by statistics and random “factoids.” The impact of Puerto Rico is zero.

The Jones Act is hear to stay.


#32

[QUOTE=Steamer;172022]Geez, I would love to see every member of congress and extended family shipped to Puerto Rico on a FoC rustbucket with a SE Asian crew and forced to live there for a year on what that crew makes.[/QUOTE]

Haven’t you heard? Global economic competition is good for business (owners who don’t give a damn about their countries or employees)!


#33

[QUOTE=tugsailor;172024]Don’t listen to know nothing alarmists spouts by statistics and random “factoids.” The impact of Puerto Rico is zero.

The Jones Act is hear to stay.[/QUOTE]

Ha ha ha. Here is another “random factoid” from National Public Radio (NPR) – about a meeting in Orlando this weekend:

“Three and a half million people live in Puerto Rico. But many more Puerto Ricans, about 5.2 million, live on the U.S. mainland. Over the last decade, crime, the struggling economy and a fiscal crisis have prompted tens of thousands to leave the island each year. Many land in Florida.At a community center in Orlando this week, Puerto Rican leaders from all over the U.S. gathered at a conference with an ambitious goal: to forge a national political agenda — and flex some political muscle.
Betsy Franceschini, a representative of the island’s government, puts their message to Congress and the White House plainly: “If you want our vote, you must listen to us.”…

But unlike other Hispanics, as U.S. citizens, Puerto Ricans who move to the mainland arrive here qualified to vote. And Puerto Rico definitely could use some help.
The island’s government has been struggling to make payments on more than $72 billion in debt. Puerto Rico’s economy has been in a recession for most of the past decade; unemployment is more than twice the national average.”

Ref: http://www.npr.org/sections/itsallpolitics/2015/10/18/449473533/puerto-ricans-vow-to-have-a-bigger-voice-in-2016-election


#34

And this was just published by Fortune business magazine:

"Whatever happens to the debt, some restructuring of the Puerto Rican economy is essential. Inefficient government monopolies raise the cost of electricity and water on the island. The Puerto Rican minimum wage is the same as in the mainland U.S., even though labor productivity is much lower.

>>>[B]And I cannot imagine any serious economist coming out in support of the Jones Act, a protectionist measure that protects the U.S. shipbuilding industry. This much-discussed policy hurts the mainland economy a bit, but is much more damaging for Puerto Rico because of the island’s greater dependence on shipping.[/B]

…One type of federal intervention would be a bailout, but the current prices of Puerto Rican bonds seem to indicate that this is unlikely. On the other hand, a presidential election is on the horizon, and Puerto Rican voters in Florida are an important group in a potentially decisive swing state.
[B]I suspect that either of our political parties, if offered the presidency for the price of a bailout, would find a way to get comfortable with it.[/B]

But Puerto Rico is just one issue in a very complicated election season, so I think that any help from the federal government simple enough to be described only with the word ‘bailout’ seems unlikely. "

Ref: http://fortune.com/2015/10/19/alejandro-garcia-padilla-puerto-rico-debt-new-jersey/

PS The lowly rats on the sailboats suggest that it is always a good idea to know where the reefs are – and which way the wind is blowing.


#35

[QUOTE=freighterman;171908]In my experience with maritime lawsuits, which spans about 20 years, the validity of a maritime injury or death lawsuit is of little importance. The unrealistic dollar amount of $100 million is a common psychological ploy by the plaintiff’s lawyer, simply meant to send a signal to the defendant, which is: "I intend to sue you for a lot of money. Or, we can settle out of court for a tiny fraction of that amount, quietly and without admission of guilt on your part. If you want to go through the whole legal dance you’ll probably win, but you will rack up $$$ in lawyer’s hours, court reporters, court costs , etc. in excess of the amount of the settlement.[/QUOTE]

I wish laws would be passed in this country so that if someone sues and loses then they are obligated to pay the legal fees and other costs incurred by the defendant.

Then this kind of strongarm tactic would be significantly rarer and less effective.


#36

You know, PR should get a four year Jones Act exception. That way everyone can see how much consumer prices change (or don’t change). I don’t want to see Pandora’s box opened but maybe the emperor needs to get on his horse and ride down the street so everyone can see his new clothes.


#37

That’s a tempting idea. Unfortunately at the end of four years there would be no compelling reason to remove the exemption and change the new status quo (from the publics perspective). Best to leave that box closed.


#38

What is the cost of ocean shipping as a percentage of the average retail price of goods in Puerto Rico? 5 to 10 percent?

Of the cost of ocean shipping to Puerto Rico, how much of that cost is attributable to onshore cargo handling expenses, agents, brokers, and fuel for the ships (all of which are the same whether shipped by foreign flag or US flag ships)? 75 percent of total ocean shipping cost?

What is the average savings on shipping costs that could theoretically be achieved by eliminating the Jones Act? 1 or 2 percent?

What makes anyone think that Puerto Rican voters in Florida have even heard of the Jones Act, much less care about it?

You already know that they are all going to vote for the Democratic candidate promising the most free stuff.


#39

[QUOTE=tugsailor;172044]What makes anyone think that Puerto Rican voters in Florida have even heard of the Jones Act, much less care about it? [/QUOTE]

  1. Gee,I dunno. Was AMP Chairman Tom Allegretti firing his cannons at a mere “alarmist” mirage back on Sept 17?

"Puerto Rico is experiencing a severe debt crisis and Congress may be considering a legislative assistance package to help Puerto Rico. Some in Puerto Rico have suggested that a Jones Act exemption be included in the legislative package under the erroneous theory that the Jones Act is bad for Puerto Rico,” said Allegretti.
“But here’s the kicker: If Congress did that — included an anti-Jones Act amendment in the package — the chances of the overall package getting enacted into law would diminish. That’s because the presence of an anti-Jones Act amendment would reduce or subtract the number of members of Congress who would vote for the overall bill. So Puerto Ricans would be undermining, and maybe even sabotaging, their own assistance package by including an anti-Jones Act amendment in it.”

Ref: http://www.americanshipper.com/Main/News/Attempt_to_repeal_Jones_Act_could_be_poison_pill_f_61523.aspx#hide

  1. However, the sinking of the EL Faro has changed the picture. Political power worth $Trillions is at stake in a Presidential election – you don’t think billionaires dump $2 billion into Presidential campaigns every 4 years for a free market, do you? Washington borrowed and spent $10 Trillion in federal debt in just the past six years fixing the 2008 mess – how much of that money did you get? The Florida electoral votes are priceless.

  2. Mr Allegretti hasn’t gotten the memo yet. Saltchuk and indirectly the others are now over a barrel with this NTSB investigation. If the
    shipping companies interfere with the Political Great Game, then the Administration could easily turn the El Faro investigation into something much more hostile – with FBI raids, talks of prosecution for negligent homicide, etc.

  3. And I doubt Mr Allegretti is going to help Puerto Rico by screwing the PR creditors and supporting a PR bankruptcy. If PR creditors --the hedge funds – are not rescued then their Congressional reps could start pushing for a lot more punitive acts than exempting PR from Jones Act shipping.

And the lawyer who filed that $100 million lawsuit against Tote could start getting a lot of useful information and documents dropped on his back porch after dark.

  1. Conversely, if Tote plays ball then maybe after the 2016 election the NTSB report will just call for “safety improvements” and no one will look too closely into how 28 American merchant seamen died. Heck, one of the wealthy factions or politicans in Washington may even chip in a few dollars to buy some flowers for the families.

  2. Maybe I am too cynical --but Obama’s first Chief of Staff was Rahm Emmanuel and one of Rahm’s favorite sayings was “Never let a disaster go to waste.” Look at what they did with the 2008 crisis – the stock of main campaign donor Goldman Sachs soared after the election from 59 to almost 181 in Obama’s first year. Meanwhile unemployment stayed high for six years–because thousands of small businesses died when they were unable to get loans from the bailed out banks. If you look at how the suicide rate of middle-aged men has soared you can see how Washington’s corruption and economic policy has killed more Americans than Al Qaeda.

  3. But maybe I’m wrong. Let’s check with NTSB Vice-Chairman T. Bella Dinh-Zarr and see how she’s coming with the El Faro investigation:

http://www.ntsb.gov/news/speeches/T-Bella-Dinh-Zarr/Pages/dinh-zarr_20151013.aspx


#40

[QUOTE=lm1883;172043]That’s a tempting idea. Unfortunately at the end of four years there would be no compelling reason to remove the exemption and change the new status quo (from the publics perspective). Best to leave that box closed.[/QUOTE]

If the law is drafted with a sunset provision like Clinton’s “assault weapons” ban would mean at the end of 4 years it would need support to renew it, not support to repeal it.