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The future of U.S. ports after Panama Canal growth
Hundreds of containers wait to be distributed at the Port of Long Beach docks in Long Beach, Calif.
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David Brancaccio: It's possible America's busiest ports may not stay busy. Southern California currently receives most of the imports shipped from Asia. But that could change with a major expansion of the Panama Canal.
Marketplace's Jeff Tyler explain
Jeff Tyler: Southern California traffic jams aren't just on the roads. Congestion can stretch out into the Pacific -- monster ships with big horns.
The ports of Los Angeles and Long Beach are the busiest in the country. But that business isn't guaranteed. The Panama Canal is adding a new, deeper lane that will allow huge cargo ships from Asia to reach the East Coast.
Robert Puentes with the Brookings Institution expects California will lose some business.
Robert Puentes: How big that shift in gonna be is still unclear. There are estimates for a 25 percent drop in and around L.A. That's probably on the high end. But we do know there is going to be some emphasis on East Coast ports.
Sending Asian imports through the Panama Canal takes longer. It's faster to send cargo across country by railroad. But congestion around the Los Angeles ports can slow things down.
Page Siplon is with the Center of Innovation for Logistics. It's his job to promote the port in Savannah, Georgia.
Page Siplon: The congestion comes up all the time. Not just in my conversations, but in business conversations. The congestions on the West Coast ports is a huge challenge.
California is fighting to protect its shipping business. Recently, a coalition of business and political leaders launched a campaign called "Beat the Canal."
Willie Brown: Hundreds of thousands of jobs are at risk.
Maria Elena Durazo: If we lose to the canal, we lose job opportunities and business opportunities for a whole generation.
It comes back to that issue of congestion.
Paul Bingham is chief economist with the Jobs 1st Alliance. It's pushing to build new roads, bridges and rail depots to help speed cargo from the ports.
Paul Bingham: In many cases, those projects are ready to go with the funds today if we could get through the government permitting process.
He says government red tape can tie up projects for years. Meanwhile, the new lane of the Panama Canal is expected to open in two years.
In Los Angeles, I'm Jeff Tyler for Marketplace.
Last month, despite major questions still being unresolved, Senator Isakson introduced an official request for more than $375 million in federal funds to be spent on the massive Savannah harbor deepening project.
Isakson’s action was part of a transportation bill recently introduced in the Senate.
We believe this request is both premature and fiscally irresponsible.
The final Environmental Impact Statement (EIS) for deepening the Savannah harbor isn’t even completed, and there have been many justifiable challenges to the draft EIS, issued in November 2010.
For instance, doubts abound about expensive “mitigation measures” proposed to reduce damaging project impacts – including unproven methods for artificially injecting oxygen into the already impaired Savannah River so that fish and other wildlife can survive. Further destruction of important tidal freshwater wetlands in the Savannah National Wildlife Refuge will also be caused by the deepening.
Moreover, until more is known about the comparative merits of deepening other harbors, there is no assurance that altering the Savannah channel and harbor will provide the maximum public benefit from this large expenditure of tax dollars.
According to latest estimates, the project will cost a minimum of $629 million, including more than $250 million in state money to be added to federal funds if they are awarded. Actual costs are likely to be considerably higher.
Contrary to many claims, the Corps of Engineers has NOT determined that this project will create ANY new permanent jobs. In fact, their lengthy analysis concludes that trends in the amount of port commerce at Savannah will be unchanged by the project. The Corps says the only benefit will be more efficient movement of goods by accommodating larger ships, yet they have not analyzed the comparative advantages of deepening other southeastern harbors instead of Savannah’s.
To be most judicious in the controversial use of federal funds, all such projects must be held to a higher standard. At the very least, funds must not be approved until the environmental analysis is finalized AND the public knows which projects will produce the maximum benefit for responsibly sustaining growth in U.S. jobs and commerce.
Unless we demand more rational and accountable methods for deciding how federal funds are spent, the U.S. cannot hope to be competitive in the 21st century’s global economy. Use of our tax dollars must no longer be dictated by states competing with one another in successive rounds of wasteful – and destructive – pork-barrel spending.
David Kyler, Executive Director
Center for a Sustainable Coast
Saint Simons Island, Georgia
Voice: 912-506-5088 (mobile)
www.sustainablecoast.org
