Merchant Marines See New Obstacles In Food Aid Proposal

Nov 10, 2013
Originally published on November 11, 2013 7:54 am

When it comes to shipping in the United States, there's a bit of a paradox. Even as U.S. exports have grown, the U.S. share of shipping has declined dramatically.

The traffic in and out of U.S. ports increases every year, but most of those ships fly foreign flags. In fact, the number of U.S. flagged ships is barely one quarter of what it was in the 1950s. That means fewer and fewer jobs for the men and women who work on those ships: the United States Merchant Marine.

Proposed changes in U.S. food aid now threaten even more jobs in a shipping industry that is already struggling to survive.

Diminishing Opportunities

It is time for job call on a recent day at the International Organization of Masters, Mates, and Pilots in Long Beach, Calif. Los Angeles is the busiest port in North America, and Merchant Marines have gathered here to bid for jobs.

There's no long-term work available on this day, however, just fill-in shifts. Dave Boatner, a vice president of the union's Pacific ports, has seen the industry change a lot in his years as a merchant mariner.

"I graduated from Cal Maritime in 1978 and the company I worked for when I started working for them in 1978, they had 50 ships," Boatner tells NPR's Arun Rath. "Now they got four. So it's significantly reduced."

Boatner, who's retired from being a captain, is relatively removed from the changes in the industry. He's not out bidding for jobs at job call anymore. But for Liz Marconi, a 32-year-old 2nd mate, looking for a job is always on her mind.

"If you are adamant about your job, then you're going to come to the union hall every day for job call, because you never know what's going to happen," Marconi says. "With our jobs, someone in San Francisco could have a job opening. ... We start bidding, whoever is in the hall. I've gotten a job like that."

A job like that might last 40 or 50 days, sometimes sailing through dangerous waters. The short notice, the threats of pirates and storms, and the long stints away from home all take their toll on young mariners like Marconi.

"I am married with two girls, a 6- and 5-year-old. So they do pay the price of me leaving," she says. "But ... when I do come home, I'm a full stay-at-home mom. So I get the best of both worlds."

At its best, being a mariner can be an amazing job. Captains make six figures, and young mariners like Marconi pick up leadership skills that can transfer to all sorts of opportunities.

"I'm hoping to make master someday, so [I'm] hoping the industry will stay alive to make that dream come true," she says.

But with fewer jobs available, it might be difficult for that dream to become a reality.

A Tough Time For Mariners

Over the past quarter-century, the Merchant Marine has hit one obstacle after another. Rising labor costs in the U.S. made U.S. mariners less competitive and environmental laws raised the cost for U.S.-flagged ships.

The past year has been especially tough. First, sequestration cuts threatened to cut off funding for the 80 ships that are currently supported by the U.S. military, which depends on the Merchant Marine to transport vital war supplies.

Now, a proposed change in the U.S. food aid programs threatens to further reduce funding. Currently, the U.S. government buys millions of dollars of food here in the U.S. and ships it abroad on American vessels.

Chris Barrett, who researches economics at Cornell University, says the U.S. food aid programs were created in 1954 to dispose of government-held commodity surpluses.

"It turned out that the main thing could really accomplish with food aid besides surplus disposal was humanitarian assistance," Barrett says. "It was a very effective vehicle for responding to emergencies that resulted from natural disasters."

Barrett says the proposed change would allow the United States Agency for International Development (USAID) to shop locally for food aid. It would be able to purchase up to 45 percent of food aid for developing countries in local markets. That would essentially divert purchases from the American market. And less food coming directly from the U.S. would mean less shipping for the Merchant Marines.

But Tonya Rawe, a policy advocate for the international food aid organization CARE USA, says the proposals make sense.

"Buying food locally is 30 to 50 percent cheaper," she says. "That means for the same amount of money you can reach a lot more hungry people. You can reach more families in need."

Rawe says that if all of the food aid changes are enacted, the aid could reach about 4 million more people — she has seen estimates as high as 10 million.

"These are people that are in dire need of assistance, that are facing a life and death situation every day," she says.

Rawe says there is flexibility in the proposals for cases where buying in a certain region doesn't make sense and actually could upset the local market. In those instances, USAID would continue to use U.S. farmers.

Who Will Be Hurt Most?

As the proposals for buying food aid outside the U.S. move forward, economist Chris Barrett says that U.S. shippers stand to lose the most if it passes. He says the reason is pretty straightforward.

"If you start buying commodities in developing countries, there's no longer a need for the ocean freight service to move it from the U.S., and they're worried about the loss of business," he says.

If you talk to people from the shipping industry, they say the loss of business would be catastrophic, the nail in the coffin after a half-century of industry decline.

Lee Kincaid, the president of the American Maritime Congress, an advocacy group for the U.S. Merchant Marine, says the U.S. would potentially lose eight to 10 U.S.-flagged ships — as well as the jobs with those ships.

"Considering most merchant ships have two crews ... you're talking about 500 U.S. mariner jobs," he says.

Kincaid says he's worried those mariners will have difficulty finding work if the food aid proposals go forward.

But Barrett says the economics just don't support the food aid program as it now exists. If the industry can't do without government money, then it needs to remake itself for the modern economy. He says many of the vessels that are at risk are antiquated and no longer competitive.

"We're keeping a market open largely for the vessel owners," he says. "The mariners can get jobs on other ships."

But even as the U.S. Merchant Marine struggles, young people still flock to it. This year, the U.S. Merchant Marine academies will graduate 300 new mariners. Whether the U.S. shipping industry can still rely on money from food aid is up in the air.

Congress will resume debate the food aid proposals on Tuesday.

Copyright 2013 NPR. To see more, visit http://www.npr.org/.

Transcript

ARUN RATH, HOST:

It's ALL THINGS CONSIDERED from NPR West. I'm Arun Rath.

On Friday, President Obama traveled to New Orleans. Standing in front of the port, he made the case for investing in U.S. shipping.

PRESIDENT BARACK OBAMA: We now export more goods and services than ever before, and that means jobs right here in the United States of America.

RATH: But here's the paradox: Even as U.S. exports have grown, the U.S. share of shipping has declined dramatically. The traffic in and out of U.S. ports increases every year, but most of those ships fly foreign flags. In fact, the number of U.S. flagged ships is barely one quarter what it was in the 1950s. And that means fewer and fewer jobs for the men and women who work on those ships: the United States Merchant Marine. That's our cover story today: why U.S. shipping is struggling to survive.

(SOUNDBITE OF MUSIC)

RATH: It's 12 o'clock sharp on Friday at the International Union of Masters, Mates and Pilots in Long Beach, California. Time for job call.

UNIDENTIFIED WOMAN #1: Well, in fact, we have nothing on the offshore port today. However, we have plenty of night work for the weekend.

RATH: Los Angeles is the busiest port in North America. Merchant Marines have gathered here to bid for jobs. They actually draw lots to see who gets to go first.

UNIDENTIFIED MAN: Yes.

UNIDENTIFIED WOMAN #2: OK, one.

UNIDENTIFIED MAN: Yes. OK, y'all. Well, keep me on the (unintelligible) on the first shift.

RATH: But there's no long-term work available today, just fill-in shifts. Dave Boatner is a vice president of the union. He saw the industry change a lot in his years as a merchant mariner.

DAVE BOATNER: I graduated from Cal Maritime in 1978. And the company I worked for when I started working for them in 1978, they had 50 ships. And now they got four. So it's, you know, significantly reduced.

RATH: Boatner, who's retired from being a captain, is relatively removed from the changes in the industry. He's not out bidding for jobs at job call anymore. But for Liz Marconi, a 32-year-old second mate here with Boatner, looking for a job is always on her mind.

LIZ MARCONI: If you really are adamant about your job, which I am, you're going to come to the union hall every day and sit here for job call because you never know what's going to happen. You know, with our jobs, someone in San Francisco could have a job opening. And you could just be sitting here and they'll call me, like, OK, we have a job. Do you have anybody down there? I'm like, oh, yeah. They're like, OK. Well, do they want it? Well, then we start bidding again, you know, whoever is in the hall. And I've gotten a job like that. I've gotten to fly out to Shanghai.

RATH: A job like that might last 40 or 50 days, sometimes sailing through dangerous waters. The short notice, the threats of pirates and storms, and a long stints away from home all take their toll on young mariners.

MARCONI: I am married with two girls, a 6-year-old and a 5-year-old. So they do pay the price of me leaving. But I also am fortunate enough that when I do come home, I'm a full stay-at-home mom. So I kind of get the best of both worlds.

RATH: You don't bring the office home with you, huh?

MARCONI: No, I do not. That is one, like, one of the best luxuries of our job. Whatever happens on that ship after I get off that gangway, not my job anymore.

RATH: But there are fewer and fewer jobs available. Over the past quarter century, the Merchant Marine has hit one obstacle after another. Rising labor costs in the U.S. made U.S. mariners less competitive. Environmental laws raised the cost of doing business for companies with U.S. flagged ships.

And the past year has been especially tough. First, sequestration cuts threatened to cut off funding for the 80 ships that are currently supported by the U.S. military, which depends on the Merchant Marine to transport vital war supplies.

Now, a proposed change in the U.S. food aid program threatens to further reduce funding. Right now, there's a requirement that the U.S. government buy millions of dollars of food here in the U.S. and ship it on American vessels.

Chris Barrett studies the economics of food aid at Cornell University.

CHRIS BARRETT: The food aid programs that we have today were really created in 1954 with the enactment of something called Public Law 480 or PO480. And PO480 was created to dispose of the government-held commodity surpluses that were generated by relatively generous government price support programs offered to farmers. So that when there were bumper harvests and prices collapsed, the government stepped in as a buyer of last resort. And as a result, the government held large stocks of things like wheat and skim milk powder, corn, soy, et cetera.

And it's expensive to hold those commodities indefinitely. So we would send them to developing countries that were not yet commercial customers of the American agribusinesses. It turned out that the main thing that you could really accomplish with food aid besides surplus disposal was humanitarian assistance. It was a very effective vehicle for responding to emergencies that resulted from natural disasters like droughts or typhoons or earthquakes as well as war.

RATH: And, Chris, could you talk about some of the proposed changes we're hearing about now?

BARRETT: The Obama administration in its most recent budget proposal earlier in 2013 proposed that the Congress authorize the U.S. Agency for International Development, USAID, to purchase up to 45 percent of the food aid it distributes in developing countries. So it would curtail the buy-American restriction for up to 45 percent of the purchases.

RATH: Tonya Rawe is a spokeswoman for the international food aid organization CARE USA. She says the proposals make sense.

TONYA RAWE: Buying food locally is 30 to 50 percent cheaper. That means for the same amount of money, you can reach a lot more hungry people. You can reach more families in need.

RATH: How will that translate into lives, this aid, for instance? How many additional people would get food?

RAWE: If we do all of the reforms they have proposed, we can reach four million more people. Some estimates have said we can reach up to 10 million more people. And these are people that are in dire need of assistance that are facing a life and death situation every day.

RATH: Is there any risk, though, that locally, there may not be the resources in the end to fill in the gap?

RAWE: Sure. So when we look at buying locally to address emergency needs, there is analysis that goes on to make sure that in buying locally, we don't upset that market. And so those are the cases when buying locally doesn't make sense, that we would continue to tap U.S. farmers. That's that flexibility to tap the best tool in the toolbox. And it's making sure we have all the right tools in the toolbox.

RATH: The Obama administration and food aid NGOs are making the case for buying food outside the U.S. That proposal is being debated in Congress this week.

I asked Chris Barrett of Cornell who has the most to lose if the proposal passes.

BARRETT: Well, the shippers, without question. And they're uniformly against this. And the reason is pretty straightforward, that if you start buying commodities in developing countries, there's no longer need for the ocean freight service to move it from the United States to the recipient country. And they're worried about the loss of business.

RATH: If you talk to people from the shipping industry, they say the loss of business would be catastrophic, the final nail in the coffin after a half-century of the industry decline.

Lee Kincaid is the president of the American Maritime Congress, an advocacy group for the U.S. Merchant Marine.

LEE KINCAID: We would potentially lose eight to 10 U.S. flagged ships and the jobs - the U.S. mariner jobs with those ships.

RATH: So you said eight to 10 U.S. flagged ships could go out of commission. How many jobs would be lost along with that?

KINCAID: Well, considering most merchant ships have two crews and one crew being at work while the other crew is on vacation spending time home with their families, you're talking approximately 500 U.S. mariner jobs. There's other transportation jobs to move those commodities to market - port jobs - and all the jobs which help to support a U.S. flagged shipping company.

RATH: We've heard an argument, pushing back on this, that these jobs aren't actually going to go anywhere. These are individuals who are highly skilled. International shipping is not going anywhere, so they'll just, you know, continue to work. How would you respond?

KINCAID: Well, first of all, you have to remember, especially if you're going to train an officer to serve aboard a merchant ship - for example, I'm a graduate of the U.S. Merchant Marine Academy at Kings Point. That's a four-year college education, so it takes a minimum four years to train an entry level officer. And then you add on top of that the time it takes to do additional education, take additional testing in order to become a captain or chief engineer. You're talking a total investment of approximately eight to 12 years to make that happen.

Now, should these eight to 10 ships disappear due to food aid changes, I don't see any other ships - new ships being built on the horizon and new jobs created where these mariners can be used effectively.

RATH: But Chris Barrett says the economics just don't support the food aid program as it now exists. If the industry can't do without government money, then it needs to remake itself for the modern economy.

BARRETT: It's important to keep in mind which are the vessels that are at risk here, which are the vessels that depend very heavily on U.S. food aid. And they're largely relatively out of date bulk and break bulk carriers, vessels that were built in the '70s or early '80s. So effectively, what we're doing is we're propping up vessels that no longer have a commercial market. So we're keeping a market open largely for the vessel owners.

The mariners can get jobs on other ships. You know, if - a skilled mariner can work any of several kinds of vessels. The real losers in the event of these reforms would be the very few people who own four or so vessels that depend very heavily upon U.S. food aid, but they're largely antiquated vessels.

RATH: But even as the Merchant Marine struggles, young people still flock to it. This year, the U.S. Merchant Marine academies will graduate 300 new mariners. Because at its best, it can be an amazing job. Captains make six figures. And young mariners like Liz Marconi pick up leadership skills that can transfer to all sorts of opportunities.

MARCONI: I'm hoping to make master someday, so hoping for the - our industry to stay alive to make that dream come true.

RATH: Whether the U.S. shipping industry can still rely on money from food aid is up in the air. Congress continues to debate food aid reforms beginning this Tuesday. Transcript provided by NPR, Copyright NPR.