Puerto Rico - Statehood and attack on the Jones Act

this statement came from the Shipbuilders Council of America

[B]U.S. Shipbuilders Slam Claims Linking Jones Act to El Faro Tragedy as ‘Incorrect’ and ‘Shameful’[/B]

October 19, 2015 by gCaptain

The U.S. shipbuilding and ship repair industry issued a statement Monday slamming ‘shameful’ and ‘unfounded’ claims purporting a causal link between the Jones Act and the loss of the cargo container ship El Faro in Hurricane Joaquin earlier this month.

The strongly-worded statement comes in the wake of critics attempting to blame the tragic loss of the El Faro with its 33 crew members on the Jones Act requirement that ships operating between two U.S. ports be U.S. built, claiming that if operators could purchase less costly foreign ships they would replace their vessels more often and avoid similar tragedies.

The National Review, an ultra-conservative magazine and news website, published a particularly critical article blaming the El Faro tragedy, at least in part, on the Jones Act’s U.S. build requirement, claiming that the legislation has strangled U.S. shipbuilding and made the U.S.-flagged fleet the oldest of any developed nation in the world.

Responding to the claims, Matt Paxton, President of the Shipbuilders’ Council of America (SCA), commented:

“To imply that vessels that do not have to comply with rigorous U.S. safety standards are safer than those that do defies common sense,” said Matt Paxton, President of SCA. “To try and connect a law that works to protect our economic and national security to this tragedy, particularly during a period when our industry family is mourning such a loss is not only incorrect, but shameful.”

The truth is, the SCA says, is that the United States leads the world in shipbuilding advancements, compared to the common designed and not highly specialized vessels built abroad. The vessels that operate between U.S. ports are built for the unique domestic trades and operate safely, efficiently, and environmentally, and are subject to rigorous safety regulations whereas foreign vessels would not be required to comport, the statement said.

During his address at the Surface Navy Association’s National Symposium this past January, U.S. Coast Guard Commandant Admiral Paul Zukunft warned of the dangers of allowing foreign flag ships in coastwise trade.

“I think, at the end of the day, it will put our entire U.S. fleet in jeopardy. And then in a time of crisis, who are we going to charter to carry our logistics? Very difficult if we don’t have a U.S.-flagged ship,” said Adm. Paul Zukunft, Commandant of U.S. Coast Guard.

In regards to the recent tragedy of El Faro, SCA says it will not comment on the incident given that there is an ongoing investigation pending, and because the matter does not pertain to U.S. shipbuilders. But it is worth noting that despite some of the uninformed statements being touted by critics, the shipyard and ship repair industry remains one of the strongest and innovative industries in the world, the SCA says.

One of the rebuttals to the “necessary for national security” claim is commonly that the US government can charter a foreign flag vessel and that there is nothing stopping foreign vessels (especially foreign flagged US owned or ally owned ships) from carrying our military supplies. My worry in that case is really the foreign crews onboard, which get conveniently forgotten when the topic arises.

[QUOTE=Capt. Phoenix;172069]One of the rebuttals to the “necessary for national security” claim is commonly that the US government can charter a foreign flag vessel and that there is nothing stopping foreign vessels (especially foreign flagged US owned or ally owned ships) from carrying our military supplies. My worry in that case is really the foreign crews onboard, which get conveniently forgotten when the topic arises.[/QUOTE]

Canada learned that lesson pretty dramatically back in the summer of 2000. They hired a foreign-owned logistics company to move $223 million worth of military equipment, including tanks, armored vehicles, weapons, and ammunition. That company subcontracted to another company, which chartered the American-owned, St. Vincent-flagged, mixed-crew GTS Katie to carry it. Sure enough, the American owner disputed payments with one of the contractors and ordered the ship to stop in international waters. Canada had to ask St. Vincent to graciously permit them to seize the ship, then assign two warships to the task of recovering their cargo. There were no Canadians involved in the actual process of moving 10% of Canada’s entire military vehicle inventory except for three soldiers who went along to look after the cargo and had no authority to give orders to the Russian captain.

Carruthers, What in the hell are you even talking about. Who the fuck are you and how are you qualified to comment on this subject?

[QUOTE=lm1883;172079]Wasn’t a chartering outfit from Baltimore in the middle of all that?

I believe the ship became a prepo, the M/V Roy Wheat maybe?[/QUOTE]

The owner was Third Ocean Marine Navigation out of Annapolis, MD. This ship didn’t have much of a career after the seizure, though. She was built in 1975 and broken up sometime before June 2001. IMO number is 7941655 if anybody’s as nosy as I am.

[QUOTE=Glaug-Eldare;172075]Canada learned that lesson pretty dramatically back in the summer of 2000. They hired a foreign-owned logistics company to move $223 million worth of military equipment, including tanks, armored vehicles, weapons, and ammunition. That company subcontracted to another company, which chartered the American-owned, St. Vincent-flagged, mixed-crew GTS Katie to carry it. Sure enough, the American owner disputed payments with one of the contractors and ordered the ship to stop in international waters. Canada had to ask St. Vincent to graciously permit them to seize the ship, then assign two warships to the task of recovering their cargo. There were no Canadians involved in the actual process of moving 10% of Canada’s entire military vehicle inventory except for three soldiers who went along to look after the cargo and had no authority to give orders to the Russian captain.[/QUOTE]

So the moral of the story is to never trust a American? :smiley:

[QUOTE=Kraken;172085]So the moral of the story is to never trust a American? :D[/QUOTE]

Not even once.™

Really, though, it’s pretty pathetic that they’re STILL all but totally dependent on foreign, fifth-party, contracted shippers with no relationship with the Canadian government to carry their official cargo. Nobody is standing by and nobody has agreed to drop what they’re doing in a sealift emergency. Their entire seaborne logistics system depends on strangers having the right ship available at the right place at the right time for the right price, and then on their seeing the mission through and dealing with contract problems later. Third Ocean stopped the cargo because they didn’t give a damn about whether they were wreaking havoc on Canada’s military readiness – they had a contract beef with an entirely separate company and they were going to settle it the way they would settle it with a peanut oil refinery in North Duckburg.

[QUOTE=Glaug-Eldare;172087]…Third Ocean stopped the cargo because they didn’t give a damn about whether they were wreaking havoc on Canada’s military readiness – they had a contract beef with an entirely separate company and they were going to settle it the way they would settle it with a peanut oil refinery in North Ducksburg.[/QUOTE]

Were they within their contract rights to do so?
Just asking’…

[QUOTE=Capt. Phoenix;172069]One of the rebuttals to the “necessary for national security” claim is commonly that the US government can charter a foreign flag vessel and that there is nothing stopping foreign vessels (especially foreign flagged US owned or ally owned ships) from carrying our military supplies. My worry in that case is really the foreign crews onboard, which get conveniently forgotten when the topic arises.[/QUOTE]

  1. My understanding is that the US Navy’s Military Sealift Command has its own huge FLEETS of large transport ships:
    https://en.wikipedia.org/wiki/List_of_Military_Sealift_Command_ships

  2. Including a lot of Large, Medium-Speed Roll-on/Roll-offs:

  1. A lot of those ships are manned by civilian mariners. But if the Navy needed to it could simply seize additional foreign transport ships and put Americans crews on them. Except the Navy doesn’t call it piracy – they call it by a different word. Ah yes, “commandeering”.

  2. Of course they would need to continue their peacetime mission of ensuring that the pirates of Somalia, south China Sea and Caribbean don’t pluck the maidenheads of you delicate flowers.

Might you be thinking of Tropical Shipping? Saltchuk Acquires Tropical Shipping for $220 Million

Pretty sure Sea Star has been a part of TOTE for quite a bit longer than a year. It was recently (around when they started using the new TOTE logo) that they decided to bring Totem Ocean Trailer Express and Sea Star under the TOTE Maritime brand name.

[QUOTE=Carruthers;172121]1)4) Of course they would need to continue their peacetime mission of ensuring that the pirates of Somalia, south China Sea and Caribbean don’t pluck the maidenheads of you delicate flowers.[/QUOTE]

people here have been kindly asking for you to cease posting…do we need to cease being kind? It’s coming you know…

You don’t know a lot about shipping do you? First off, no government, except Iran or North Korea does such things because it is a straight up act of war. The US can’t take a bunch of Chinese container ships in LB, recrew them and put them on a new assignment simply because we happen to need them. Sure if we were at war with China we could but by then trade relations would’ve soured so much that there wouldn’t be any Chinese ships in US Ports. The Navy can redirect US Merchant ships, and send them on a new mission with specific orders if, in time of crisis, it is needed. This is called Naval Control of Shipping. I have to side with the others, who are you? You have a lot to learn about the maritime world, and this forum is for professionals.

[QUOTE=+A465B;172109]Were they within their contract rights to do so?
Just asking’…[/QUOTE]

They were not (nobody can seize property of the Crown), but with respect to military readiness, does it really matter? 10% of their vehicle inventory was seized by a foreign business for more than two weeks. Would you tolerate that here, even if the seizor was standing on their rights in a contract to another commercial party? Coming back to cabotage, the Jones Act, and cargo preference, the thing that allowed this fiasco was that the entire sealift was handled by purely foreign interests who had no reason to treat the government of Canada as anything more than another cargo owner whose property could be seized the same as a box of snow globes from China.

[QUOTE=Carruthers;172121]4) Of course they would need to continue their peacetime mission of ensuring that the pirates of Somalia, south China Sea and Caribbean don’t pluck the maidenheads of you delicate flowers.[/QUOTE]

Now I feel like making my avatar a picture of a pretty, delicate flower…

B[QUOTE=Louisd75;172123]]

Might you be thinking of Tropical Shipping? http://gcaptain.com/saltchuk-acquires-caribbean-shipping-and-logistics-company-tropical-shipping-for-220-million/#.Vib7HisWwqM

Pretty sure Sea Star has been a part of TOTE for quite a bit longer than a year. It was recently (around when they started using the new TOTE logo) that they decided to bring Totem Ocean Trailer Express and Sea Star under the TOTE Maritime brand name.[/QUOTE]

Yes. You are right. I stand corrected.

The top US oil refining group, American Fuel & Petrochemical Manufacturers, urged the repeal of the Jones Act yesterday in a letter to Republican
Senate leader Mitch McConnell:

This article from Sept 2014 notes AFPM’s argument:
“Despite the appearance of, at best, limited supported for weakening the Jones Act on Capitol Hill, petroleum marketers and refiners are planning a substantial effort to get Congress to change the law which they claim is driving up motor fuel and heating oil prices and severely inhibiting the flow of crude between US ports amid the ongoing domestic oil boom.”

Hmmm. Looks like the Puerto Ricans might have some allies. If the swing voters of Florida (and possibly the 2016 US Presidential election) can get the Jones Act lifted then some other parties can benefit. Because in spite of Hillary’s pandering, neither she nor the Democrats control Congress.
Hence, they can’t deliver anything before Nov 2016 and after that Puerto Rico’s power (and any politican’s promises to them )turns into a pumpkin. Big Oil Republicans can deliver, however. There is Obama’s veto of course but if Obama wanted Hillary to be his successor then his Intel Community and FBI wouldn’t be poring over her email servers.

Plus I suspect some Republican billionaire donors like Puerto Rico’s Governor Padilla. After all, one reason
PR can’t pay her debts is that a reported $35 billion per year flows back to the USA tax free.

Which is why Senator Orrin Hatch’s statement that Puerto Rico’s government accounting needs to be made more transparent was hilarious.

Re the Jones Act, there is the saying that if you look around the poker table and don’t know who the sucker is then it is you. Whether exempting
PR from the Jones Act would actually help is almost beside the point – it is a cheap gesture that would distract/appease the Rabble in both PR and USA, help reelect Padilla in PR next year, gain the swing voters in Florida and let the real game continue behind closed doors.

let’s give it up for the Shipbuilders Council of America

[B]Jones Act critics ignore the facts[/B]

10/22/2015

By Matt Paxton, president, Shipbuilders Council of America

In the wake of the tragic loss of the El Faro and her 33-member crew during Hurricane Joaquin, familiar opponents of the maritime industry have shamefully used this difficult time as a weak attempt to blame the Jones Act for the tragedy.

The highly customized vessels that operate between U.S. ports are built specifically for the unique trade that they operate in. The vessels lead the world in both safety and technological advancements. More importantly, U.S.-built vessels are subject to strict safety regulations. So to imply that vessels that do not have to observe rigorous U.S. safety standards are safer than those that do defies common sense.

To try and connect the Jones Act – a law that strengthens our economic and national security – to this tragedy during a period when our industry is mourning the loss is not only incorrect, but also shameful. The United States, including our shipyard and repair industry, leads the world in ship construction advancements, including launching the world’s first LNG-powered containership – with millions more to come in investments in building and infrastructure.

The critics of the Jones Act and the build requirement choose to ignore the cold hard facts. While we will never see them acknowledge our industry’s economic accomplishments and safety standards – including providing nearly 500,000 good paying jobs in all 50 states and $39 billion in output into the U.S. economy – we are exceedingly proud of those accomplishments.

Our industry is also proud to serve as a backbone for the brave men and women who protect our homeland. That’s why the Jones Act has wide bipartisan support in Congress, from every modern day president and the highest levels of leadership in our armed forces. When Vice Chairman of the Joint Chiefs of Staff Gen. Paul Selva was asked about his support of the Jones Act, he replied, “… Without the contribution that the Jones Act brings to the support of our industry there is a direct threat to national defense.”

Adm. Paul Zukunft, the Coast Guard commandant, recently warned against the threat of repealing the Jones Act. “At the end of the day, it will put our entire U.S. fleet in jeopardy. And in a time of crisis, who are we going to charter to carry our logistics? Very difficult if we don’t have a U.S.-flagged ship.”

Despite some of the uninformed statements being touted by critics, the U.S. shipbuilding and ship repair industry remains one of the strongest, safest, and most innovative industries in the world.

Any time a mariner is lost, our industry feels it deeply into our very core. We at the Shipbuilders Council of America stand in strong solidarity with the men and women who served the El Faro as well as their families. Baseless attacks from critics who only seek to gain economically from this difficult time insult the legacy of these mariners and their families, and they need to stop.

Matt Paxton is the president of the Shipbuilders Council of America. In this capacity, he advocates for a robust and expanding U.S. shipyard industrial base. He is also a lawyer, focusing on maritime law and environmental issues.

The idea that the Jones Act is responsible for old pos ships is ridiculous. You are eliminating the threat of competition of foreign old pos ships as well as foreign new ships that are cheaper. The reason we have old ships is because the companies are cheap. If there were a law forbidding ships over 20 years old then the companies would raise their rates slightly and use new ships.

[QUOTE=Carruthers;171903]PS The New York Times followed up its Oct 14 story with another one yesterday – re problems on the El Yunque:

The article states:

"El Faro was built in 1975, and El Yunque a year later. … "

I am currently aboard El Yunque and can confidently say that she was built in 1974 and not in 1976. Also, the El Yunque is not a floating rust bucket as she is made out to be. Like any other ship, the maintenance work aboard her is pretty much the same that can be found on any deep sea ship. We do 20knots coming and going without breaking into a sweat and all machinery aboard her is working just fine, thank you very much. My only grouse is that I wish I had a thermostat in my cabin so that I can adjust the a/c to my liking. Yeah, even the a/c works just fine in this 40some yo ship.

The ship may be old, but she is comfortable, with satellite TV in all cabins and all that blah. So, NY Times can fuck off.

BTW, z-drive … the tug that we use in PR is a Moran tug named z-one. Thought you’d get a chuckle out of this :slight_smile:

The highly customized vessels that operate between U.S. ports are built specifically for the unique trade that they operate in. The vessels lead the world in both safety and technological advancements. More importantly, U.S.-built vessels are subject to strict safety regulations. So to imply that vessels that do not have to observe rigorous U.S. safety standards are safer than those that do defies common sense.

Maybe the best way to save the Jones Act and domestic shipbuilding would be to stop bragging and start to look at why it cost 2-3 time more to build a ship in US yards than to build the same ship with the same machinery and equipment and to meet the same standard of safety at a shipyard in Japan or South Korea.

To claim that US ships are designed and built to a higher standard than others is plainly not true. USCG rules are generally based on IMO requirements minimum standard and Class requirement are similar for all major classification societies. To believe otherwise, or to claim that foreign built ships are less safe then those built at US yards is just kidding yourself.
Those of you who have worked on foreign built Ocean-going ships, OSVs or Rigs can maybe enlighten those who hasn’t.

The claim that the cost is because of the high labour cost and safety standard in US yards, while “them for’ners” are working for a “handful of rice” and in unsafe conditions is also manifestly not true. Simple container ships, bulkers and tankers are still being built in countries like Japan and South Korea, although China is taking over more of this business. Top of the line Offshore and other specialized vessels are built in Norway, (nobody in their right mind will claim that Norway is a low-cost taxhaven with lax safety standard)in Holland and Germany.
Admittedly the hulls are mostly built in East European countries, where labour cost is less, but still not slave wages.

The LNG Container ships being built in San Diego are being lauded as proof of US shipbuilding and design superiority.
The fact is thatis actually built to a standard DMSE design The main machinery are MAN B&W but manufactured in South Korea: http://www.lngworldshipping.com/news/view,introducing-the-worlds-first-lngpowered-container-ship_39075.htm
So what make them Jones Act compliant? The work of putting them together and the steel (if not imported from China)? I wouldn’t be surprised if the navigation equipment is supplied by Furuno and the GMDSS station by Sailor. What is left then that is domestic?

PS> The same applies to the Product Tankers being built at now Philly Shipyard: http://www.phillyshipyard.com/news.cfm?path=1,229&id=3-1602

Maybe it would make more sense to put pressure on the few yards that is still in operation to modernize their equipment and building methods to compete with foreign yards on price, quality and design.
The age profile of the US fleet, Jones act or otherwise, is telling you that there must be a potentially large market for new shipbuilding for the US market, but as long as they can go on charging unsustainable costs and Owners are forced to pay, there will be no improvement in any of the above.

For those of you working on rigs in deep water GOM; How many US built and flagged rigs are there out there? Where does the equipment on them originate from, incl. on the drill floor?

The same questions can be asked for the “state of the art” Sub-sea Construction vessel working in deep water GOM, or the Heavy Lift Crane vessel (SSCV), the Seismic vessels and just about anything else that is able work there, except simple PSVs.

There are some development towards building high end Offshore vessels in the US, but to foreign design and with foreign equipment, which may be the way to go to improve the capability of US yard.
Eventually they MAY be able to compete with own design and US made equipment, but not as long as they can hide behind a protective barrier that enable them to charge whatever the captive market is willing to pay, and keep on building the same old-same old.

Many countries regulate domestic shipping and require that port to port transport is by ships owned, flagged and manned by locals. Locally built vessels are encourage, but OECD rules (and EU rules in case of Europe) prohibit such protective barriers, as well as subsidies over and above certain limits set by OECD.

I don’t advocate removing the Jones Act altogether, but maybe modify it to where it would encourage US flagged vessel in both domestic and foreign going trade and US shipbuilding to supply those vessels at competitive costs. At one time US shipyard built vessels for the world, not just for a minuscule captive market. Why not again??

The idea that if ANYTHING is changed in the Jones Act, US shipping is doomed and US seafarers cannot find work is not necessarily true, even if it is repeated many enough times.
In worst case there is a shortage of qualified seafarers world wide and many flags allow foreign officers, incl. Masters, as long as they hold COC that is internationally recognized. (IMO STCW compliant) Wages and conditions may vary from company to company, but some foreign owners may offer better terms than what you can expect from US owners.