The fall of the US Maritime industry


#21

Just a heads up. I have a feeling, that some of the members that show up from time to time are part of the forum management team. Your well-spoken writing style and editorial experience suggests that. I am not saying that anything you are saying is incorrect. Hope all is well and you and your family are enjoying your summer mate / captain keep up the great work. Your blog, social media presense, etc is great Captain. Thanks it is appreciated by us forum members. I know you know alot more about this industry then most thats why you are in the postion you are in and absolutly deserve.


#22

[QUOTE=freighterman;188607]I’m trying to understand exactly what you mean Emrobu (I mean that in a nice way). Can you be more detailed when you say “If you were competing with China for ores…”? Competing for ores is like competing for oil in most ways. It’s a market. it goes up, it goes down. How that helps a merchant marine reach a steady-state of ships–I don’t see it. Or am I missing a point?[/QUOTE]

What I mean is that the US doesn’t have the ores that she once had to feed her steel mills. Not producing the steel she once did means that she cannot have the heavy industry that she once had. China makes a lot of things out of steel, but they also do not have the iron ore deposites. They get their iron the same way they get their other bulk resources: they import it from other places and bring it home on their ships, for their workers to make their export products. Used to be Canada exported lumber to China, now we export timber. They closed our mills by buying the trees whole. We shouldn’t be allowing that. China buys a lot of their ore from Australia. Australia shouldn’t be exporting ore, they should be exporting steel. But the story between Africa and China is quite shocking. Oil, copper, tin, rare earth metals, timber, gems, and food. For a few years trade was increasing 20% per anum between China and Africa! Those African resource extraction operations are Chinese owned. The ships moving the treasure home are Chinese owned. The local laws are written to facilitate Chinese interests. If the US was trading with these countries more, buying those resources for more money, treating people more fairly, being more environmentally responsible than the Chinese, they would have a competitive advantage and they’d be able to fuel their own manufacturing and transportation sectors. Less corruption and greater prosperity in Africa is going to lessen the power of terrorists.

Look, just have your man, Barak, call me, ok?


#23

[QUOTE=Emrobu;188613]What I mean is that the US doesn’t have the ores that she once had to feed her steel mills. Not producing the steel she once did means that she cannot have the heavy industry that she once had. China makes a lot of things out of steel, but they also do not have the iron ore deposites. They get their iron the same way they get their other bulk resources: they import it from other places and bring it home on their ships, for their workers to make their export products. Used to be Canada exported lumber to China, now we export timber. They closed our mills by buying the trees whole. We shouldn’t be allowing that. China buys a lot of their ore from Australia. Australia shouldn’t be exporting ore, they should be exporting steel. But the story between Africa and China is quite shocking. Oil, copper, tin, rare earth metals, timber, gems, and food. For a few years trade was increasing 20% per anum between China and Africa! Those African resource extraction operations are Chinese owned. The ships moving the treasure home are Chinese owned. The local laws are written to facilitate Chinese interests. If the US was trading with these countries more, buying those resources for more money, treating people more fairly, being more environmentally responsible than the Chinese, they would have a competitive advantage and they’d be able to fuel their own manufacturing and transportation sectors. Less corruption and greater prosperity in Africa is going to lessen the power of terrorists.

Look, just have your man, Barak, call me, ok?[/QUOTE]

yeah, he’ll be sure to call. Here’s how business works in the US. Laissez faire. Independent boards run public traded companies and they are risk averse. Make a mine work in America or Africa? A smelter in America (or Australia) with first world regulatory controls? Pass. President wants this! Screw that! We have to answer to stockholders. He can either pay us, by subsidies or tax credits or he can start his own company. Too risky too costly. US labor is a big part of it, what board would stay in power if they ignore cheaper opportunities overseas? China business gets told to open a mine in Africa, because the Chinese communist party insists on the political benefits? Gonna happen. It takes American businesses that can tolerate risks and pay more for US labor for strategic benefits. Doesnt sound like a country running forty year old EL FARO, does it? Ketchikan Pulp Corp closed. Wasn’t for lack of trees. Was the modification of 50 year subsidized contract on timber prices from National Forest. No pay, no play. Canada has export controls…not total control, logs are exported, at a higher cost than those for domestic mills. At least for now. Protectionism or subsidies. Otherwise free market will eat the costlier markets.


#24

.

In the USA this crap was going since the Reagan administration. We subsidized (stupid) the heavy logging of what little remained of the ancient old-growth timber up in the Tongass (stupid, again) with minimal environmental controls so that erosion ruined a lot of the salmon streams (even more stupid), and exported them raw to, among others, Japan on foreign ships (stupid x 2). That’s 5X Stupid, altogether.

A country with natural resources to exploit and export would, rationally, try to capture as much of the value-added processes as possible. Don’t export logs, export lumber. Or better still, finished wood products like furniture or baseball bats. It’s idiotic to export enormous, rare, and irreplaceable raw logs at all, let alone to a country with little to no timber of its own left for just board-foot value.

And yet despite all the trees being felled, mills shut down all over the PNW and unemployment was rampant.

Stupid is as stupid does - Forrest Gump


#25

[QUOTE=DeepSeaDiver;188608]Just a heads up. I have a feeling, that some of the members that show up from time to time are part of the forum management team. Your well-spoken writing style and editorial experience suggests that. I am not saying that anything you are saying is incorrect. Hope all is well and you and your family are enjoying your summer mate / captain keep up the great work. Your blog, social media presense, etc is great Captain. Thanks it is appreciated by us forum members. I know you know alot more about this industry then most thats why you are in the postion you are in and absolutly deserve.[/QUOTE]

are you 12?


#26

[QUOTE=sjöman;188637]are you 12?[/QUOTE]

Yes but that makes me older then you. I heard you were 10? Hows the baseballl going this summer? Are you done with your summer camp yet? Did you have fun? What kind of crafts did you make?


#27

[QUOTE=freighterman;188599]

My point is, if you want the huge behemoth of a USMM that came out of WW2, taxpayers have to pay for it.[/QUOTE]

I don’t know if a “behemoth” of a merchant marine is required but a diminishing number of taxpayers are paying for it now. Since the bankers and money launderers discovered that they can make more money by selling off American industry rather than building it, a larger population now spends more of a shrinking income on foreign imports of products made by foreign industry and delivered to America by foreign ships.

Our own government seems to have no qualms about using foreign flag ships to carry cargo paid for by the taxpayer. MARAD owns a fleet of ships under the fiction of being prepared for defense needs. While those ships rot at the dock, foreign flag ships carry more taxpayer purchased government owned cargo.

We not only subsidize farmers to grow crops for giveaway programs, we pay foreign companies to deliver those products while American ships rot and mariners age out of the industry. That is among the most idiotic and stupid subsidies ever foisted on the non-farmer, non-money laundering, non-elected American.

Don’t trash the “greens” for trying to protect the resources we still have. If not for them every tree in SE Alaska would be floating in a mill pond in Tokyo Bay. Talk about subsidies … while timber companies were getting fat hauling publicly owned logs over Forest Service roads, those logs were shipped whole to Japan. The mills that used to employ Americans to process those logs were closed and the workers either “re-educated” at public expense or condemned to a life of unemployment or welfare. Who paid the bills for their medical care? Talk about subsidies …

If our corrupt politicians and MARAD weren’t bent over by the bankers and thieves who bought them the office we might have a healthy merchant marine based on a healthy economy that can support domestic production and transportation.

Talk about subsidies? Look at what we spend to promote and support the cruise industry and the foreign yards that profit by it.

We are rapidly becoming one of the largest kleptocracies on the planet.


#28

[QUOTE=DeepSeaDiver;188639]Yes but that makes me older then you. I heard you were 10? Hows the baseballl going this summer? Are you done with your summer camp yet? Did you have fun? What kind of crafts did you make?[/QUOTE]

It’s because [I]every[/I] single post by you that I’ve read, has never added ANYTHING useful to conversation, yet your posts are all over this forum, all in infantile grammar, mind you. It’s like throw up on my screen, looks like you just want to rack up your post count for whatever bizarre reason? Of course, by engaging in it with you, I am committing the same crime, so this is my last post regarding that, but I just wanted to point out… god damn, boy scout, go easy on that keyboard.


#29

[QUOTE=Jamesbrown;188616]Here’s how business works in the US. Laissez faire. At least for now. Protectionism or subsidies. Otherwise free market will eat the costlier markets.[/QUOTE]

Laissez faire is clearly a winning strategy. Everything is clearly fine the way it is. Nothing needs to change. Let’s just keep tripping along the way we are. It’s totally fine if the lowest bidder gets all the trade, maintains all the expertise, has control of all the resources. It’s cool. How do you say laissez faire in Chinese?

Protectionism and subsides are defensive strategies which are nearly always chipped away at by lobbyists and legislatures. The west needs to start doing business in Africa and other resource extraction places, and we need to start doing it better than the Chinese. If we do that right, their cost of doing business is going to go up. We won’t have to be as protectionist, because the price difference between their goods and ours will be less.


#30

Freighterman @ 8
I understand your argument regarding the size and range of USMM developed for WWII, the role of subsidization and the point you are making about taxation in general but I would add these comments:

  1. Not sure exactly what you mean by a “vibrant” or “reinvigorated” USMM vs in another post “huge behemoth os a USMM”. For me I would settle for a healthy USMM. For me this does not need to rival the maximum fleets sizes you mention at turn of century or during WWII. So I guess the question is what does a healthy USMM look like? What we have now? Of course not. I don’t think you can deny having a healthy USMM would naturally support defense requirements or humanitarian missions as the case may be. But is that the raison d’être or just a feature of a healthy USMM?

  2. The sad decline you outline seems true enough but I think the real reasons are maybe more subtle and date back even further than WWII. Check out this dude Andrew Furuseth Read about the his involvement with the Seamens Act of 1915 Look we are all subject to think we have it so so bad at times but this legislation did this (in 1915):
    *abolish imprisonment for desertion
    *reduce penalties for disobedience
    *regulate the working hours of seamen both at sea and in port
    *establish a minimum quality for rations supplied to seamen
    *regulate the payment of wages to seamen (establish a harsh penalty of double wages per day that any wages remained unpaid upon a sailor’s discharge (which resulted in one case where the U.S. Supreme Court awarded $302,790.40 to a sailor who had been discharged with $412.50 in unpaid wages)
    *set safety requirements, including the provision of lifeboats
    *require a minimum percentage of the seamen aboard a vessel to be qualified able seamen
    *require at least 75% of the seamen aboard a vessel to understand the language spoken by the officers

And for this high crime American ships began being flagged in Panama.

These laws put U.S.-flagged vessels at an economic disadvantage against countries lacking such safeguards.[23] By moving their ships to the Panamanian flag, owners could avoid providing these protections. Belen Quezada, the first foreign ship flagged in the Panamanian registry, was employed in running illegal alcohol between Canada and the United States during Prohibition. In addition to sidestepping the Seamen’s Act, Panamanian-flagged ships in this early period paid sailors on the Japanese wage scale, which was much lower than that of western merchant powers.

and this:

The modern origin of open registries can be traced back to the 1920s, when the United Fruit Company created the Honduran open registry to ensure the cheap and reliable transport of its bananas. The Panamanian open registry came about soon after that because U.S. flagged passenger ships wanted to serve liquor during Prohibition.

This was a purely an unpatriotic commercial decision and course of action in my opinion and the real start of the decline. This wasn’t the result of mis-managed government subsidies. Maybe just greed? Shortsightedness? Corporate worship of things other than what actual citizens might? Who knows. Just part of the capital/labor tension of our brand of capitalism?

  1. I believe government has a role to play in regulating the tension between capital and labor and that reasonable plans can be developed that would restore a healthy USMM and allow for corporate and merchant seaman progress. Where does the national consensus and will come from to achieve this? I think long gone are the days of reasoned debate and study in the US Senate based on facts and elevating goals and even compromise. You know 20% of the effort getting 80% of the results - no, far better to take a hard line and watch the country decline in any number of areas. And why are those days gone? Money in politics. Lobbying and campaign contributions. We seem to be in a post-fact realm now. I think the executive branch is getting a bum rap in most cases when the real scoundrels are in the legislative branch.

  2. So being willing to pay for a healthy USMM (taxation) is one question but it comes only as part of resolving a bigger one. What are our national priorities? What do we value for our citizens. Why in Gods name do corporations have the rights and privileges of actual living, walking around humans? Until the legislative branch actually performs the function it is supposed to (collect facts, think, deliberate, compromise, plan, revise) in place of sitting there taking hard lines linking abortion to road repairs etc and defying logic in so many ways (and getting paid for it with salary AND lobbying / campaign funds) - don’t be surprised MARAD just sits there doing the same thing over and over with the meager funds and laws governing their actions. I don’t think it has been or is a choice for individual tax payers being willing to pay for “it” but it seems to be linked to who those taxpayers vote for. I do not see many persons of integrity presently serving in either house of congress willing to undertake the real work required to make things better. Or having the courage to not be unduly influenced by lobbying groups and apply intellect to real problems and work to solve them. Then again that’s easy for me to say. Unfortunately not a pretty picture.


#31

[QUOTE=freighterman;188579]At the turn of the last century the U.S. had about 3,000 vessels of 100 tons or greater. 3,000.[/QUOTE]

What I think your numbers fail to represent is the size of the US foreign going fleet in relation to the worldwide fleet. We were a powerhouse on the global scale, now we are a footnote.


#32

[QUOTE=Steamer;188640]I don’t know if a “behemoth” of a merchant marine is required but a diminishing number of taxpayers are paying for it now. Since the bankers and money launderers discovered that they can make more money by selling off American industry rather than building it, a larger population now spends more of a shrinking income on foreign imports of products made by foreign industry and delivered to America by foreign ships.

Our own government seems to have no qualms about using foreign flag ships to carry cargo paid for by the taxpayer. MARAD owns a fleet of ships under the fiction of being prepared for defense needs. While those ships rot at the dock, foreign flag ships carry more taxpayer purchased government owned cargo.

We not only subsidize farmers to grow crops for giveaway programs, we pay foreign companies to deliver those products while American ships rot and mariners age out of the industry. That is among the most idiotic and stupid subsidies ever foisted on the non-farmer, non-money laundering, non-elected American.

Don’t trash the “greens” for trying to protect the resources we still have. If not for them every tree in SE Alaska would be floating in a mill pond in Tokyo Bay. Talk about subsidies … while timber companies were getting fat hauling publicly owned logs over Forest Service roads, those logs were shipped whole to Japan. The mills that used to employ Americans to process those logs were closed and the workers either “re-educated” at public expense or condemned to a life of unemployment or welfare. Who paid the bills for their medical care? Talk about subsidies …

If our corrupt politicians and MARAD weren’t bent over by the bankers and thieves who bought them the office we might have a healthy merchant marine based on a healthy economy that can support domestic production and transportation.

Talk about subsidies? Look at what we spend to promote and support the cruise industry and the foreign yards that profit by it.

We are rapidly becoming one of the largest kleptocracies on the planet.[/QUOTE]

[B]Kleptocracies;[/B]
noun, plural kleptocracies.
a government or state in which those in power exploit national resources and steal; rule by a thief or thieves.

[B]Contemporary Examples[/B]

Indeed, a condition of rampant, endemic political corruption is known as a “ kleptocracy ”—literally, “rule by thieves.” --Dictionary.com

Sounds just like my beloved home, America USA. I agree with you Steamer.


#33

Amen.


#34

They actually have more, far more than mere humans.

Because they have found willing buyers in the halls of Congress. We have a government corrupted by greed and protected by those who bought them. We have government institutions that have prostituted themselves to use the Constitution against the people it was intended to protect.

If those statements were not fact we would not have such obscenities as “Citizens United” whose very title is an obscenity in its own right. We would not have elected officials who ignore their constituents while bowing down to those who deliver the largest campaign contributions.


#35

The US owned fleet is growing from acquisitions on fire sales:


#36

Big difference between the US owned fleet and the US flag fleet. This is a mariners forum. Not a shipowner, broker, or banker forum. Though i suppose this would be stupendous news if it were.


#37

Yes that is true, this is a mariner’s forum and mainly US mariners at that.
But it cannot hurt being informed on what is going on in the world of Shipping, especially if it involves US Shipping, even if it is not in the Jones Act trade, or the GoM.


#38

I think the point is it has nothing to do with American shipping of any species. It is American investment firms and bankers buying cheap ships to flag in cheap registries and man with cheap labor to make big profits to stash in offshore accounts. It is another bleeding sore on the decaying body of the American merchant marine.


#39

Our ruling class is morally bankrupt. It troubles me that if we can’t turn this around, we’ll crash and burn.


#40

If you truly believe in what that shirt says, you’re part of the problem.