Do you know who owns the ports?


American ports aren't being run by American companies.

If you are wondering how 80% of American ports came under the control of foreign companies, well, the answer is pretty simple.

Although at least 80 percent of terminal operations are foreign-run, those in the shipping and ports business say increased foreign investment is just a fact of life in the global marketplace.

"What we have is a supply chain that is global in nature ... and we have in this country many foreign-owned corporations operating in ports," said Michael Jackson, a deputy secretary at the Department of Homeland Security. "Our ports are owned by public authorities in the United States. Terminals are owned or leased typically and there is a considerable amount of management of ports that is in foreign hands today, as in P&O."

London-based Peninsular and Oriental Steam Navigation Co. is the firm that sold the U.S. port terminals in question to United Arab Emirates-owned DP World for $6.8 billion.

"You'll find that the larger companies like DP World, P&O ports … that they are major conglomerates where they are vertically integrated in terms of the transportation links and the supply chain that start anywhere in the world from the ports of embarkation" to the time the destination is reached and cargo is unloaded, said Dennis Rochford, president of the Maritime Exchange for the Delaware River and Bay.

Rochford noted that 2,500 out of the 2,700 ships that travel on the Delaware River are foreign. That's because in the past, higher labor costs and taxes plagued some U.S. shipping lines that also had to compete with foreign companies employing lower-wage crews and dealing with fewer regulatory burdens.

"It's just simply more economical and more competitive to fly under foreign flag ships than American flags," Rochford said. "It's the economics of the marketplace that are driving it."

Added FOX News market analyst Tobin Smith, chairman and chief investment officer of ChangeWave Management, LLC: "The only way you can make money in the terminal business ... is to own terminals throughout the world … that's why no American company bid on this, because no American company has the wherewithal to fill terminals of these American docks."

That's not necessarily a bad thing.

But just in case you are keeping score.

American maritime and port companies are killed by restrictive regulation.

Foreign companies buy ports and provide shipping.

With one high-profile deal, Congress "panics" and pulls the plug, reversing it's earlier behavior.

Congressmen push for more American investment in ports and shipping, but shows no signs of repealing the legislation and regulation that killed it off in the first place.

Gee, I wonder if this could happen to other segments of the economy?

Or maybe it already has.

— NeoWayland

Posted: Fri - March 17, 2006 at 04:31 PM  Tag


 ◊  ◊   ◊  ◊ 

Random selections from NeoWayland's library


Pagan Vigil "Because LIBERTY demands more than just black or white"
© 2005 - 2009 All Rights Reserved