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Whoops definitely Alberta not Alaska! I don't know if that was a Freudian slip or autocorrect!
That said if it does go through I doubt it will be to long before we connect it to Alaska which holds a huge portion of the United states oil reserves (proved reserves measured behind only Texas and North Dakota). Right now the lower 48 states produce more because the cost of transport from Alaska is higher but with the completion of a pipeline (and possible future connection to Alaska) that may change. Most of Alaskas budget is funded by oil production and therefore connection to an existing pipeline seems almost inevitable IF keystone is ever completed.
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Goods can be shipped directly from foreign ports to Hawaii NOW, but we mostly don't provide a big enough market to make it worthwhile. The Jones Act affects only goods shipped from one US port to another.
Currently, a foreign ship comes to the first US port and unloads everything bound for the US, which then gets loaded onto other ships, rail cars, etc.
Without the Jones Act, the foreign ship could drop off some cargo at the first port, then go to the next port and unload what's needed there. The savings comes from the cargo being handled fewer times.
quote:
Originally posted by pahoated
If Jones act was repealed, south American produce could be shipped directly to Hawaii.
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quote:
Originally posted by Lee M-S
Currently, a foreign ship comes to the first US port and unloads everything bound for the US, which then gets loaded onto other ships, rail cars, etc.
These are international entryway ports and they are controlled access points. For Hawaii, this is Honolulu. A lot of business is the import/export market with Asia, southeast Asia, Australia. That is why Thailand watermelons are competitive with local grown watermelon. It does take companies selling directly to Hawaii for them to have dedicated container ships, coming in full, leaving mostly empty except for recycling cardboard, cans, bottles to be actually recycled in Asia, southeast Asia and Australia. It is just weight of history that most of the fruit and produce being imported to these islands is from the mainland US, with the pipeline infrastructure that has been developed over 100 years. The corporate grocery stores stay with their mainland pipelines, and since they are US, they mainly stay US sourcing.
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This is interesting. Perhaps Hawaii can move to actually producing a good to fill those ships going back. Perhaps that would make shipping even cheaper and even perhaps make Hawaiian ports more active instead of all west coast US trade going out of California. Just talking as a armchair general but that might be interesting. This could spur business and create more local jobs I might think. Make it cheaper to export Hawaiian produced goods internationally.
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The Jones act was and is for the military - to insure American trained personel, know-how and ownership for times of war. They require ocean going transport for troops and supplies. American shipping is a relic of this "military-industrial complex".
These (american wages) extra costs are to some degree offset from Military Sealift Command funds. Matson, Hoizon, and Pasha are receiving payments as part of ready reserve fleet.
Yes, more competition would bring down rates somewhat. But the big cost factor is the huge number of empty containers that need to be repositioned and over a great distance. An empty costs the same as a loaded one and takes the space of potential revenue. So this imbalance doubles the costs per container and is reflected in the price we pay.
Unless Hawaii creates an export trade our shipping costs will remain high, and this isn't even considering distance and small market costs. Our 1.3 million can't even feed itself produce. Then there are the costs and environmental issues in building new marine terminals and yards. What do you want to see built on our shoreline?
Repealing the Jones Act is no panacea. It would require major changes to really lower our shipping costs.
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Without the Jones Act.
Ships bound from the Eastern Seaboard of Europe and Asia including those from Australia New Zealand etc. to the West Coast of the United States could in theory not only stop in Hawaii to offload some goods but could also pickup goods bound for the West coast of the United States and on their return run across the Pacific make another offload and reload in Hawaii before completing the return crossing.
Keeping the above in mind... it would create circumstances where Hawaii could indeed manufacture goods and be competitive with other manufacturers on the mainland as shipping cost would be substantially reduced making Hawaii the central shipping hub of the entire Pacific.
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I would guess there would be a lot of agitation against repealing the Jones Act from US shippers like Matson and from US longshore workers, who would lose business and/or work. So pending legislation might be a signal to stock up on TP...
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The Jones Act helps protect the ship building and repair industry.
Yes ships made in China are cheaper, but all those shipyards and workers are Chinese.
You can look at everything made in the USA and conclude that you personally will save money here and there but at a big expense.
$14.0 Billion in annual economic output and 84,000 jobs in U.S. shipyards ; 70,000 jobs working on or with Jones Act Support
Hawaii exported $697 million in goods and $4.2 billion in services in 2013.
So even if Hawaii goods exported went up 10 times, the cost to the shipping industry is far greater.
Besides all those arriving ships would be coming with goods cheaper than those made in Hawaii now. Most ukulele are made in the Philippines. They even import some koa wood for high end versions. Cost here for a good koa ukulele is $125.
Let's face it. Accept for some crops and airplanes it seems the rest of the world produces goods far cheaper using labor at $10 per day or far less.
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Hawaii with its strong NIMBY group, high land, utility, and labor, costs is not overcome by reducing shipping cost.
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"The Jones Act helps protect the ship building and repair industry."
It also excludes workers from work comp rather shifting the burden to the employers liability coverage ....It is in many ways anti worker and pro ship owner.
