Container on barge rate published by Seacore:
Container on barge rate published by Seacore:
Invalid? The question is what makes this argument valid? Why is it a necessary link that increased output per employee would reduce costs and increase numbers? Is there a reason the article doesn’t show that relationship? Did price go down for cars and aircraft?
Nope. The automobiles grew steadily more expensive during that time period, prices rose each year.
Aircraft also increased in cost. But ships would get cheaper?
I read the entire Cato Jones report. Unless I missed something, it only speaks of the US build requirement and no comments on cabotage.
In a world where ships are ubiquitous and shipbuilding capacity for all kinds of vessels is deep and broad, the Jones Act could contribute to national security by focusing on the objective of ensuring a ready reserve of trained mariners to crew our sealift ships. If the Jones Act’s onerous and unusual domestic-build requirement alone were repealed, the supply of ships and the demand for mariners would rise.
I guess few people here read the entire report…because Gcaptain’s very on Mr. Konrad is quoted and there are no comments!
Beyond generating uncertainty, there are intrinsic disincentives for mariners to serve in times of conflict. For example, mariners are asked to place themselves in harm’s way, but are generally not considered veterans for the purpose of accessing related federal benefits.100 There are other complications, as well. John Konrad, founder of the maritime website gCaptain , notes that despite the critical military role played by civilian merchant mariners, the U.S. military does not provide them training on such important matters as how to join a military convoy or share information with Naval Intelligence.101
Of course it does, the US build requirement is the goal. And they want the mariners, unions and political power to be on this side of the argument. “Kill the build requirement and mariners will rejoice!“ At least that’s what they’re selling.
But it’s BS.
It will kill all the build jobs and related industries, that is certain, and obvious. Will it increase mariner jobs? Why? It would only increase the jobs if there would be expansion of marine transport (coastwise) that relies on crews. There’s little reason to believe that would result and the report provided no assurances or explanations why it would. How do they support this statement:
Why is that a necessary result, what makes it certain? Are there a bunch of CEOs making statements in the report that ‘if only’ the build provisions were scrapped they’d commit and would be willing to pen deals to build new terminals, get more manned ships and be able to drastically improve transport costs from rail, highway in a way that rail and highway couldn’t immediately undercut? Would CEOs commit to manned ships or just more tugs and barges? How would the mariners ensure they don’t get shafted, since that is the sales pitch? What is the benefit of destroying the US commercial shipbuilding industry (such as it is)? How is it good for the US to trade those jobs and economic injects related? Does anyone believe that this will create more jobs than it kills?
Oh and again, there are non US build ships—they only do it cause they get subsidies that basically completely offset crew costs. Why in the face of that evidence does anyone think it would be different if all US build requirements were dropped? And what evidence supports that?
Moneyed interests are gonna keep pursuing this with the same argument. If it succeeds, it will only benefit them and no one else.
Only 240 years of economic theory. Please see Adam Smith’s “The Wealth of Nations.”
This is from Adam Smith Wealth of Nations:
There seem, however, to be two cases in which it will generally be advantageous to lay some burden upon foreign, for the encouragement of domestic industry. The first is, when some particular sort of industry is necessary for the defence of the country. The defence of Great Britain, for example, depends very much upon the number of its sailors and shipping. The act of navigation, therefore, very properly endeavours to give the sailors and shipping of Great Britain the monopoly of the trade of their own country, in some cases, by absolute prohibitions, and in others by heavy burdens upon the shipping of foreign countries.
I’m a hundred percent behind that policy. We should be supporting the Mariner and shipping industry in support of national security. But as currently implemented, I don’t believe US policy is as effective as it should be. Anything that ultimately drives down the cost of cabotage-protected shipping in the US should ultimately benefit our industry.
“Believe”, “should”… well, that’s some compelling argument there. It’s just hopefulness. It’s understood that mariners would sacrifice all the shipbuilder jobs for personal benefit, but it’s a bad trade and likely wouldn’t help as I have described previously.
The cost of cabotage shipping will get reduced more readily by switching to barges, reduced crew, better financing for building Improved efficiencies onboard and of course competition than the cost of financing a US build.
Hmm, nothing in my copy of Smith about how lack of facts compels an argument… I did run across this though:
“To widen the market and to narrow the competition, is always the interest of the dealers…The proposal of any new law or regulation of commerce which comes from this order, ought always to be listened to with great precaution, and ought never to be adopted till after having been long and carefully examined, not only with the most scrupulous, but with the most suspicious attention. It comes from an order of men, whose interest is never exactly the same with that of the public, who have generally an interest to deceive and even oppress the public, and who accordingly have, upon many occasions, both deceived and oppressed it.“
Adam Smith was a wise man. As you point out, every policy has winners and losers. Whether or not protectionism has helped or hindered US shipbuilding is often debated. From my perspective, it hasn’t kept it from dying a slow death. I’d rather try something new to see if coastwise shipping and the merchant marine can be stimulated instead. But I understand your arguments.
IIRC, there have been other reports by the CATO institute trying to abolish the Jones Act completely. Maybe now they’re just trying to chip away at it to achieve their end goal.
As a general rule, anything Cato wants will not be good for 99% of the country and I am for sure not in the other 1%.
I can’t provide charts, figures, or any other made up facts. The only info I can throw in the pot for discussion is to look at the airline industry. It seems to be thriving with growth, employs thousands, and ticket prices have consistently gone down.
It seems the airline industry operates under the ideas proposed in the CATO article and has been growing growing growing…why can’t the same happen to the shipping industry?
Are there hundreds of millions of people in the USA that want to travel by ship but do not because it costs too much?
I guarantee that if it cost less to sail across the ocean than to fly that would be the case. And while that isn’t possible, there are hundreds of millions of tons of products that do not travel by ship because the cost is too high. In this case we are competing against road and rail.
Well, that’s good…
Here’s a fun Cato Institute paper on US crew requirements being the problem. Cause, you know they are consistent…and totally invested in making US mariners lives better… Not.
There’s no reason to trust the Cato institute. They aren’t doing it for the little guy.