EU Considering $100 Price Cap on Russian Diesel
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Yesterday I sat down to watch Food, Inc, and excellent and eye widening movie that shines light on the problems engrained in the domestic production of food in America. Although briefly, the movie mentions the vast subsidies of grain that the US government ships overseas.
It is now clear to me the exportation of grain by US mariners has had a detrimental effect on world stability but my first thought on this subject was, of course, centered on the maritime industry and the patriot inside of me revolted. The exportation of grain gives many US mariners jobs that are protected under the Jones Act. But I soon asked myself, is this truly the case?
As the movie showed, shipping grain overseas creates dependencies that have lead to population growth and job loss in 3rd world nations. Prior to the subsides much of the third world economy was agricultural based with the majority of workers focusing on the growing food on small farms. When US flagged ships started arriving in ports to offload grain the local farmers could not compete with the low prices of this grain and were forced out of business, ending the self sufficiency of the entire region. With the local farms closed, the farm workers were out of work and without formal job training many of them turned to criminal activities. Further, with low food prices supported by this grain, populations have grown without a job based economy to support them.
But this has wider implications that just internal struggles in distant ports. Piracy in waters off Somalia did not start with the influx of capital and ideas from a criminal organization, the first Somali pirates were satisfying a basic need. Fishermen faced with a dimishing fishery caused, in part, by pollution of the Gulf Of Aden started catching less fish. This was not the only motivation of early pirates. Supply and demand would have compensated for the decreased stock considering that Somalia currently has the 7th highest birth rate in the world but with grain subsidies to africa driving down food prices throughout the continent, coupled with the increased cost, mostly fuel related, of operating a fishing boat, the Somali fishermen began having trouble meeting the most basic needs of their families. Soon a few turned to piracy and, once they proved it to be successful, then criminal organizations moved in.
How does this effect US Mariners? Well the Maersk Alabama, at the time she was attacked, was providing jobs to American merchant seamen but at a cost of high personal risk. The mission of the Maersk Alabama was bringing subsidies to Kenya and it’s these very subsidies that have flooded the local economies and driven local farmers and fishermen out of work.
But why have US food subsides grown? The first problem is that food subsides to foreign countries appear, on the surface, to be a win-win situation. Farmers are happy to have their crop sold, mariners are happy to have jobs transporting these crops and third world foreigners are happy to be fed. But, again, at what cost? Farmers are selling their crops but the subsides have driven down crop prices to the point of requiring the average farmer to take out large loans to purchase new technology, like seeds from Montesano and combines from John Deer, that allow them to produce more effectively but put them in greater amounts of debt. US mariners have jobs but these come at a high personal risk and do not have the benefits (overtime, career advancement, interesting work) of commercial runs. The locals are happy to have the food but do not realize it competes with their local agricultural system, removing self-sufficiency and promoting growth without job creation.
The second problem is that US grain export is a bi-lateral cause. The liberals in Washington want to help the developing world and their is no greater cause than feeding a hungry child. The conservatives, on the other hand, see great benefit in supporting the large American farmers and corporations that benefit most from US subsidies.
Why is this a problem for US Mariners? First the the subsidizing and export of US grain is very expensive. This directly results in higher taxes for all Americans. But the largest concern for the average US Mariner is the Jones Act itself.
We have additional US Flagged jobs because of the political desire to move subsidized food overseas. Part of this political motive is to gain good-will among foreign countries and this is done most effectively when a ship arrives in a foreign port flying the American Flag. The bottom line is that they need us to a larger extent than we need them but no agricultural lobbyist has ever campaigned for the Jones Act. They see the act as essential to the movement of grain and help protect the Act in a weakened state but they do not promote the Jones Act in industry segments like offshore oil or cruise ship. This would be counter productive because grain gets transported on MARAD ships that are out of contract. If the ships had lucrative jobs hauling commercial goods, as the act intended, then they would not be available to transport grain at rock bottom prices. So their primary desire is to keep the Jones Act in a weakened state and thus, keep us desperate for jobs and willing to offer our ships at reduced cost to them.
The Crux of the matter… Like the chain of events that leads up to a major incident, the US flag has suffered over the previous decades for a myriad of reasons but one stands high above the rest, the structure of our government. The reason that US agriculture is a booming while the maritime industry has suffered goes back to the great compromise of 1787 when, in writing the Constitution, it was proposed that America be governed under a bicameral legislature. This resulted in power being divided between the US Senate and House Of Representatives with the greatest topic of concern being the weight of power given based on population. As we all know, each state was given an equal number of senators, two, but differing number of congressmen based on the relative population of each state.
What does this mean for mariners? States with low population have the same number of senators as states with high populations but far fewer constituents to worry about. Further, the majority of low population states are agricultural and inland. The states that have large ports also have large populations to deal with so, in addition to promoting the maritime industries in their districts, they also have a heavy-some burden of other concerns, everything from education to medical care.
So the senator of Iowa has as much power as the senator of California but only one industry to “take care of”… agriculture. While the senators (and representatives!) of the maritime states have numerous industries to fight for and, sadly, maritime affairs gets lost in the shuffle. This brings us right back to the Boston Tea Party… mariners are currently being taxed but not represented.
So what is the solution? The fix would be to alter the constitution to assure that each industry has representation. But this did not work 200 years ago and it would not work today. To find a fix we need to look at the economic model, more specifically who needs who. Without cheap hulls paid for by the US government the large agricultural conglomerates would be stuck paying the bill, at commercial rates, to transport their grain and this cost would motivate them to pay more attention to the needs of the domestic maritime industry.
A call to action..
First you must understand the weight of power the agricultural industry has in this country and to do so I suggest you rent the movie Food Inc or read the book Fast Food Nation, by Eric Schlosser.
Second I ask you to consider taking to your congressmen, union representatives and fellow mariners about saying, “no thank you” to grain runs… we would rather have your efforts applied by concerns more pressing like strengthening offshore jobs under the Jones Act.
Last I welcome you to post your suggestions as comments below. It’s our community that, together with good ideas, has the power to change policy.
Side note: I have been reluctant to post about the Jones Act and my government’s policies to prevent foreign workers from serving aboard US ships specifically because the majority of our readers are not Americans. But the food crisis is a global problem and America is not alone in creating third world dependency on foreign grain. Further the work of the maritime industry to support the development of jobs, local fisheries, education and other support structures that give third world nations the ability to be self sufficient is critical to the success and protection of the world as a whole. If you are not American but have read the article this far, I ask that your call to action be investigating the movement of food through your local ports and questioning the sustainability of our current system of trade.
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