Cummings, Landry Lead Effort to Save American Maritime Jobs Tuesday, July 24, 2012

Discussion in 'Academy/Military News' started by tankercaptain, Jul 27, 2012.

  1. tankercaptain

    tankercaptain Member

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    SEAS Act to Repeal Section 100124 of Highway Bill
    U.S. Representatives Elijah E. Cummings (D, MD-07) and Jeff Landry (R, LA-03) introduced the Saving Essential American Sailors (SEAS) Act, H.R. 6170, which would ensure American food aid is transported by American workers. The bill repeals Section 100124 of the highway bill, MAP-21.* Additional original co-sponsors include Congress members Nick Rahall (D, WV-03), Rick Larsen (D, WA-02), Bennie Thompson (D, MS-02), Colleen Hanabusa (D, HI-01), Cedric Richmond (D, LA-02), Michael Grimm (R, NY-13), Tim Bishop (D, NY-01), and Candice Miller (R, MI-10).
    Section 100124 reduces the amount of U.S. food aid required to be carried on U.S.-flagged ships from 75 percent to just 50 percent, jeopardizing up to 2,000 American maritime jobs. The Maritime Administration (MARAD) estimates that enactment of Section 100124 could cause the U.S.-flagged fleet to lose 16 vessels and $90 million in annual revenues.
    “The number of vessels in the U.S. flag and the percentage of U.S. cargoes carried on American vessels have continued to fall in recent decades. Currently, there are fewer than 100 U.S.-flagged vessels in the foreign trade, and these vessels carry less than two percent of U.S. cargoes,” said Cummings. “If we allow a further decline in this fleet and the loss of additional mariner jobs, we risk leaving our economy and indeed our military dependent on foreign-flagged, foreign-owned vessels manned by non-U.S. citizens – a situation that would be intolerable.”
    “This is what happens when Washington rushes bills; we don’t fully debate them or understand their ramifications. Section 100124 will mean that American taxpayers will be paying foreign workers while American mariners sit on the beach,” said Landry. “I hope my colleagues from both sides of the aisle will join us in fighting for our American workers and quickly pass the SEAS Act.”
    In a May 2011 letter, Commander of the United States Transportation Command General Duncan McNabb wrote that “over 90 percent of all cargo to Afghanistan and Iraq has been moved by sea in U.S. Flag vessels” and noted that U.S. cargo preference laws and the Maritime Security Program have helped in “ensuring the continued viability of both the U.S. Flag fleet and the pool of citizen mariners who man those vessels.” McNabb continued, “the movement of U.S. international food aid has been a major contributor to the cargo we have moved under the cargo preference law that our U.S. commercial sealift industry depends on. Any reductions will have to be offset in other ways to maintain current DoD sealift readiness.”
    “This ill-conceived change in our cargo preference laws would literally ship American jobs overseas,” said Rahall.* “The SEAS Act provides a sensible solution to correct this flaw in the surface transportation bill.* It is a job-protecting measure that merits smooth sailing through Congressional consideration and enactment.”**
    “The SEAS Act will undo a short-sighted provision that dealt a huge blow to job creation at a time when the maritime industry is already hurting,” Larsen said. “Congress should be doing everything it can to create jobs. The SEAS Act will reverse this backward step that could cost our mariners thousands of jobs. I am committed to working with my colleagues to undo this short-sighted provision and protect these important jobs.”
     
  2. AF6872

    AF6872 Member

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    Great Post! Little is known or considered about the decline of the US Maritime industry.

    Little known and greatly under appreciated.

    http://www.msc.navy.mil/
     
  3. bruno

    bruno Retired Staff Member

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    It's an industry that only exists on the governments handouts- either thru cabotage rules which prevent foreign flags between domestic ports, or because of government preference requirements. But there is a huge cost difference in operating American flag ships- partly as a result of union negotiated rules and partly of government regulation often sponsored by either the union or the comapnies that have carved out a niche under the Jones act and have no interest in allowing new competitors into that tight market- or else the few shipyards out there who build ships for the domestic trade ( virtually the only ships the few commercial US yards build) - who also benefit from the protective restrictions. If Cummings and Landry really wanted to do something for the US they would be looking at ways to make it more competitive- lower manning costs and reduce crews, understand the ship building dyanamics that make the US un-competitive not only with China and Korea but with Italy and Finland. Instaed they offer up more protection for the few companies still in the business to the detriment of US consumers and tax payers.
     
  4. tankercaptain

    tankercaptain Member

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    Bruno
    Your post shows a real lack of understanding of the maritime industry and the US Merchant Marine. I suggest you take the time to research the subject before posting.
     
  5. pointguard

    pointguard Member

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    KP future?

    For those with insight pls comment. DS graduates HS 2014, KP is # 1 choice. Let's say he gets in and graduates KP in 2018. Will the career future he is going to study for in Marine Transportation still be there in the view of those who understand this better than I? Do the vessels have to be American Flagged? Thx
     
  6. tankercaptain

    tankercaptain Member

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    Bruno
    With your vast maritime knowledge, what is the crewing difference on a 656 by 105 RO/RO on an American flagged vessel vs a foreign flagged?
    So what's the pay difference for a foreign AB vs American and how does the union keep the pay non competitive?
    If unions are destroy the US Merchant Marine then why are all the top paying sea going jobs non union (off shore industry, Chevron, SeaRiver, OSG Mates, Polar Tankers). How does US shipping compete with USCG regulations vs FOGs?
    I suggest you look into how heavily Korea subsidizes their shipyards. China doesn't have OSHA! Take a look at safety standards at Chinese shipyards, they would never be allowed to operate here!
    I can go on, cause its easy.
     
  7. bruno

    bruno Retired Staff Member

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    Really- which part do you disagree with? BTW I have spent a fair amount of time researching this- I suppose its possible that the industry has changed since I did my thesis at the NWC on this subject but it doesn't look like it to me from what I see. There are virtually zero US flagged ships outside those that ship either USG preferred cargo or sail between US ports. Those are requirred to be crewed by us officers and crews but for the rest of the trade- they are way too expensive, compounded by sailing an aged inefficient fleet. US shipyards are hopelessly archaic compared to the commercial yards of the major shipbuilding countries- which is why virtually no one buys US built ships. At least the Norwegians and the Brits have overseas registry ships which at least reduce the cost of crew while maintaining home grown officers. What do we do? Offer up more industry/ interest group set asides to maintain the little vestiges of the industry rather than try and figure out how to get smaller cheaper crews on technologically advanced ships to compete with low cost chinese or filipino crews on convenience flags. The US shipping industry is reais so anaemic that the Navy in the form of MSC is the most robust piece of it- hardly a commercial success story.
    I am doing this ona blackberry in the adirondacks so I am hardly in a position to cintinue with long treatises- but if I am wrong and you disagree disagree- tell me what part of that analysis is wrong? Other than some tankers- which part of the industry is alive and kicking because it is really efficient and competitve with the major shipping flags of the world?
     
    Last edited: Jul 29, 2012
  8. tankercaptain

    tankercaptain Member

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    Your whole post is wrong. You post about vessel crewing, there is no difference in crewing numbers for US flagged vessels vs foreign flagged vessels. You post about unions not allowing pay to be competitive. How do US flagged companies compete when foreign flagged vessels hire filipino or chinese crew at $800 a month and willing to commit to 12-18 months aboard the vessel, 2 months off then repeat ie another 12-18 months.
    How do US flagged vessel compete when they are required to meet USCG standards vs SOLAS standards?
    How do US shipyards compete when nations heavily subsidized their shipbuilding program? When the average shipyard worker works for pennies on the dollar and there are not the same regulatory safety standards.
    The other fallacy of your post is the importance of strategic sealift. You do realize 90% of everything goes into theater via ship. So you are telling us all here there in no strategic values to have military equipment and supplies shipped into theater on US flagged and crewed ships?
    Juat because you did a paper at the NWC on US shipping hardly makes you an expert!
     
    Last edited: Jul 29, 2012
  9. tankercaptain

    tankercaptain Member

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    I will also post this. US Jones shipping via short shipping sea lines can be economically viable and is much more enviroentally friendly that having 4,000 trucks driving up I 95. However you fail to acknowledge how heavily the US government subsidizes trucking and rail .

    The Jones Act assures the U.S. mainland and its offshore communities continue to have reliable domestic water transportation service subject to national control in times of emergency
    Jones Act vessel construction and repair in U.S. shipyards assures the availability of the skilled professionals and the modern facilities needed in times of war or national emergency
    Freight revenues earned by domestic carriers, shipyards, and repair yards are subject to taxes. Foreign owned carriers and shipyards are not!
    Because of these requirements for the U.S.-manned vessels, the American merchant mariner is kept employed and trained, while at the same time maintaining readiness to man essential vessels in times of war or national emergency
    Environmental standards, liability, safety, and enforcement are assuredly improved by having American-owned vessels and U.S.-citizen-crews responsible for safely delivering the goods along our nation’s waterways

    In 2009 dollars, the indirect and induced jobs account for $35.5 billion in U.S. value-added (i.e. Gross Domestic Product) and $22.6 billion in labor compensation. Overall, the Jones Act fleet is responsible for nearly half a million U.S. jobs and generates $45.9 billion in value added, $29.1 billion in labor compensation, and $11.4 billion in taxes to federal, state, and local governments.
     
  10. deepdraft1

    deepdraft1 Master, Ocean Steam or Motor Vessels, unlimited

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    Ships worldwide are already at bare bones manning levels. Due to increasing crew work loads the rest requirements of STCW 95 are becoming more and more difficult to comply with; especially on line haul, fast turnaround ships that are operating in areas of heavy traffic while still trying to maintain schedule integrity. I know this from firsthand experience having served for years on containerships running in the U.S. west coast to far east trade. So reducing crews further to save money should not be part of the answer. Not if you want ships operated safely.

    As far as crew cost go, U.S. mariners are significantly more expensive (probably on the order of 4 to 5 times higher) no argument there; but you have to keep in mind that cost associated with U.S. crews are reflective of a higher standard of living we Americans enjoy. Maybe you would be okay with working as an Able Bodied seaman for $900.00 a month or a 3rd Mate for $1,600 a month which is common on foreign flag ships. (by the way that’s barely above the $1,590 per month Federal Poverty Level for a family of 3). I don’t think you’re going to get a whole lot of Americans willing to work at sea for those wages. It’s hard to make the mortgage and buy groceries on that. I know in California it’s next to impossible..

    I will guarantee you one thing, if you remove subsidies and protections like cargo preference, cabotage laws (e.g. the Jones Act) and MSP (Maritime Security Program) nothing would prevent American shipping companies from crewing their ships with foreigners and flagging them out; and that would spell the end of the U.S. Merchant Marine as we know it.


    Tankercaptain, I agree with you there..
     
  11. tankercaptain

    tankercaptain Member

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    Bruno
    Ironic that you talk about the US Shipping industry being a government handout however the US Food Aid Program is one of the largest handouts to US Farmers and Foreign interests.
     
  12. AF6872

    AF6872 Member

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    And these guys only got recent recognition:
    Re: Murmansk Run When it counts the Merchant Marine steps up: OK It was Russians at the time. My Bad

    http://www.armed-guard.com/ag79.html
     
    Last edited: Jul 30, 2012
  13. LineInTheSand

    LineInTheSand USCGA 2006

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    Looks like the maritime folks won this little debate.


    Bruno, what grade did you get on that thesis? :biggrin:
     
  14. jasperdog

    jasperdog Member

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    Another point ...

    I've been out of the industry for some time but when i was in it another "cost difference" between operating US Flag Vessels in a US owned and domiciled company and a US Owned/Controlled company owning and operating ships in a company offshore and under a "Flag of Convenience" back in those days mainly either Liberia and/or Panama but now also or even more so Marshall Islands was the tax situation ...

    At the time this was in addition to the already highlighted delta between the regulatory delta cost of operating under a USCG regulated vessel vs. those regulated in accord with other IMO signatory nations (there are 33 IMO signatory nations and the US is pretty much the only one where there is/are significant additional compliance costs over and above ALL of the other 32...) And that was before the past 7-10 years where frankly, in the opinion of the US Commercial Maritime industry, the manner and conduct of relations between the USCG Office of Marine Inspection and the industry has if anything gotten more adversarial and less conducive to being able to make a fair and reasonable profit. This is of course on my part second hand information but I have many classmates still in the industry and most will strongly agree with that comment/observation.

    Finally, obviously those of us who are current or former mariners, will, in general, obviously see and strongly point to what we believe is the ABSOLUTE necessity of a maritime, island nation like the US' strategic need and imperative for a strong, US Flagged Merchant Marine.

    Just as US Soldiers, Sailors, and Airmen, in general have and are provided with a reasonable standard of living, by US standards and that standard of living means that they are paid more than say their Pakistani or even Singaporean peers, we'll then logically ask and why should a US Merchant Mariner be treated any differently? The items that Bruno points to then clearly make no sense to us, especially since a) direct subsidies such as CDS (Construction Differential Subsidy) and ODS (Operational Differential Subsidy) no longer exist and instead for over 20 years the preference laws such as the 75% rule for food aid, the MSP, VISA, etc. were all put in place to more economically (from a taxpayer perspective) still ensure a viable US Flag in their absence and b) as pointed out many, many other US trading partners have cargo preference and/or other maritime subsidy programs in place and active.

    After all it's not like any of us here brought up the fact that well over 33% of the cruise industry's revenues come from US Citizens, cruising on ships whose itineraries originate and end at US Ports and yet today there is but one (1) US Flag Passenger Vessel in operation and that ought to change. Nope, not one of us said anything like that ... The reason we don't is we know in the current environs while the Jones Act could indeed benefit from some update and modernization (for example requiring 50% of those vessels to have their deck and engine departments, both licensed and unlicensed to be crewed by US Documented Mariners... etc.); we generally believe that couldn't practically happen and it's more likely the current laws would be "gutted" and the industry would be left worse off than it is today by exactly the type of over-simplified perspective described in Bruno's post.

    Sorry for the ramble -
     

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