The Year in Review: MarEx Defined the Issues and Set the Pace
A month-by-month selection of our lead editorials, critiquing and chronicling the major maritime issues of the year, as seen and reported by MarEx Editor in Chief Joseph A. Keefe.
As the deadline for this e-newsletter began to loom large in my radar scope, I nevertheless took a few minutes off to look back and reflect on the past twelve months. If 2009 was not the best of years for many in the global maritime industry, then it certainly did not lack for drama. And, it is true: time really does fly when you are having fun.
My exercise in reminiscing did have a point. This year, we’ve decided to give you the year in review through the eyes of MarEx – and specifically – our lead editorials, as seen in this e-newsletter for the past 52 weeks. And, why not? As your primary source for maritime news, cutting edge information delivery and razor sharp opinion pieces, no one else quite has their finger on the collective maritime pulse like we do. You can follow the various links to review the articles and issues that shaped our world in 2009. Now, let’s get right to it:
January kicked off with plenty to talk about, and when Coast Guard Commandant ADM Thad Allen released the nation’s new Arctic Policy, you knew it wasn’t going to be business as usual anymore on Alaska’s North Slope. The melting ice cap, dire warnings about global warming, Allen’s own insistence that the obsolete document be updated to reflect the realities of maritime commerce in Arctic waters and renewed interest in oil and mineral exploration in the region, made the Arctic and its many issues a frequent lead in this year's e-news.
MarEx immediately praised the document but panned it as nothing more than a Paper Polar Bear in the face of a woefully underfunded effort and inadequate resources afforded to the Coast Guard to make it happen. In that January opinion piece, we insisted, “Today, the Coast Guard has just two Polarclass icebreakers, only one of which is operational, and another newer icebreaker, the Healy, which is usually engaged in research missions. Recently, Todd Shipyard was awarded the contract to provide maintenance and repairs on the Coast Guard's two Polar-class icebreakers. Both vessels, homeported in Seattle and built in the late 1970s and are the only Coast Guard assets that can handle the heavy ice of both polar regions. It is not nearly enough.” It still isn’t.
It turns out that we were right after all. Since then, two German merchant vessels have transited Arctic waters, offshore leases there are being doled out and the U.S. government itself is predicting that Arctic waters will be ice-free in as little as twenty years. The reality of all of that has wide-reaching implications for America’s domestic maritime community. We’re still not yet ready for it, though: Thad Allen knows it, and now, so do you.
January, as it also turned out, was a busy month for the Coast Guard. By the end of month, it was also apparent that the effort to consolidate U.S. mariner credentialing into one National Maritime Center in West Virginia was anything but complete. The growing chorus of complaints forced Congressional subcommittee hearings and new promises by the nation’s fifth uniformed, military branch to do better. The bleeding continued into the summer months as pressure continued to build on NMC and its command to get it right. By the end of September, that effort began to yield real fruit. And, as we said then, “Given the tools now available to them – bolstered by heightened flag-level attention – there just aren’t any plausible reasons why they can’t deliver on that promise. The maritime industry and a slew of mariner advocates are watching closely to see that he does. So are we.” As 2010 looms large in the windshield, we at MarEx still are.
February brought perhaps the most prominent story of the year, contained in the growing scourge of piracy, particularly offshore Somalia and in the Gulf of Aden. The problem brought forth a host of so-called “security experts” who promised a quick fix. But, as we stated in our February 5th editorial, “…these criminal acts are borne from economic desperation in the face of a growing political and social vacuum. By all means, keep up the pressure offshore and implement (the many & readily available) security measures that all parties can agree are sound and well-planned. In the meantime, maybe it is time for a Subcommittee hearing on what to do about stabilizing Somalia where it really counts: ashore. Arguably, we are no closer to that solution today than we were almost 11 months ago.
February also saw outgoing MARAD Administrator Sean Connaughton take a position with ABS. Connaughton’s departure from DOT would also set into motion a yearlong wait for the Obama administration to name his successor. As we move into the new year, that nomination has still not been confirmed by the U.S. Senate. And, in the meantime, domestic maritime matters languish as the new President seems more intent on laying asphalt than solving the real underlying problems which could be solved by a stronger waterfront, shortsea shipping and a cohesive, multi-modal transportation policy that could eventually lead us all out of the woods. Don’t hold your breath. Meanwhile, the guy who set into motion perhaps the most meaningful era of MARAD action in decades has once again apparently moved on. Look for Connaughton, if confirmed as expected, to lead Virginia’s transportation department with the same tenacity and competence that he showed at the U.S. DOT.
The month of March, as the old saying has it, came in like a lion. The guilty plea from the pilot of the ill-fated COSCO BUSAN ushered in a new era of heightened scrutiny for North America’s elite fraternity of harbor pilots, along with the promise that it would be anything but “business as usual” going forward. COSCO BUSAN was a game changer. That reality simply can’t be debated any longer.
By the end of March, the era of the Hawaii Superferry was also over. Doomed by an impossible regulatory process (perhaps bungled from the outset by its operators), the ambitious maritime enterprise promised an environmentally correct approach to providing low cost and efficient transportation to a domestic market that was literally crying out for it. As it turned out, all of that would not be enough. Also spiraling down the drain was millions of Title XI money extended for the project and – perhaps – any hope for more such loan guarantees for future newbuildings of this scope and size.
In April, MarEx editor (and aging dinosaur) Joseph Keefe woke up to the fact that “social networking” was here to stay. Today, MarEx leads the maritime news industry in its delivery of news in many unique ways. Our LinkedIn Group now hosts more than 5,900 members and continues to grow with every passing day. As you look for your news going forward, also look to MarEx to provide more of these types of innovative tools and others, such as our highly popular Podcasts in the New Year.
By May, the problem of Piracy had the full attention of the maritime world and perhaps took everyone’s mind off the dismal economy, if only for a few moments. That’s because the incredible cost of the problem to the collective shipping industry was only now becoming painfully apparent. The predictable congressional hearings ensued and changes to existing laws were considered in answer to a growing cacophony of complaints from domestic ship operators that the government was not doing enough to make sure that U.S. tonnage was safe. As we head into the New Year, the problem is anything but solved, mariners and ships are still being taken and – sadly – the violence associated with these brazen attacks on merchant shipping is doing nothing but escalate.
June came with the realization that the Jones Act would once again move front and center as folks debated the viability of the U.S. Merchant Marine, the legality of foreign-operated tonnage working in the U.S. GOM oil patch and the extent to which U.S.-flag tonnage could be repaired or improved in overseas shipyards and still remain legal. A Washington Post OPED by Richard K. Bank (a former director of the State Department's Office of Maritime Affairs from 1972-79) trashed the domestic U.S. maritime industry and compared the demise of Detroit’s automobile industry to the alleged “fall” of Jones Act shipping. We took issue with his assessment in our June 4th editorial and so did more than a few others, as evidenced by our online mailbag entries, in the week that followed.
Later (in October), we nicely summed up the current domestic maritime situation in our October 21st editorial. In that piece, we asked, “Is the Jones Act really In Extremis? You’ll have to go back and click on the article to find the answer.
Also in June, concerns that the current administration in Washington would continue to neglect the collective waterfront came down to roost. It also became clear at the same time that only the smallest fraction of the billions and billions of dollars of ARRA funds being thrown at the nation’s transportation systems will ever reach the ports of the most important island nation in the world. As the summer wore one, it was also painfully apparent that the solution to many domestic transportation problems – not the least of which was the insolvent Highway Trust Fund – was staring the President and the congress directly in the face. As you get ready to pop the cork on your bottle of champagne, they have yet to reach up to grab the brass ring.
The dog days of summer reminded us that just because some of us go on holiday, the business of shipping never rests. In July and August, it was also heating up again (no pun intended) in Alaska, where they continue to figure out how, if and when the long-awaited gasline from the North Slope will ever be built. From our seat, the effort to move that gas through Canada to the lower 48 instead of using the deepwater port of Valdez is a mistake. Nevertheless, the melting ice cap will likely make this debate a moot point before too long – especially since we are at least ten years away (and probably more) from moving one cubic foot of gas down any pipeline in Alaska.
Also in August, the dirty word TWIC reared its ugly head once again. This time, it was (mostly) good news. MarEx Editor Joe Keefe applied for and received his TWIC credential in Charleston, SC in what turned out to be a fairly painless process. Still to be resolved: wide scale deployment of TWIC readers and the universal acceptance (READ: education) of security personnel everywhere that the TWIC card is THE preferred waterfront credential. That aspect of this effort is clearly a work in progress.
September brought the long-awaiting ballast water standard from the U.S. Coast Guard. As many as ten years in the making, and carefully navigated through the environmental regulations minefield, the proposed standard virtually mirrors the IMO benchmark. Although this will, if approved as proposed here in the United States, potentially simplify the worldwide effort to eradicate the spread of invasive species through ship’s ballast, the proposed standard also does not go far enough, according to some individual U.S. states. That said, the higher standard – said to be 1,000 times stricter than the IMO and Coast Guard proposals – cannot be measured to with any accuracy given the technology available to do so. Bottom line? It’s still a mess and we are additionally at least a year or two away from standardizing the “approval” process in the U.S. for available technology and equipment.
In October, the U.S. Maritime Administration (likely egged on by the Obama administration – with their arm further twisted by Nancy Pelosi) reversed course on a previously solid NRDF ship disposal Policy and caved in to the demands of the state of California with regard to how to remove obsolete tonnage from their Suisun Bay fleet. As a result, the price of disposing of obsolete tonnage just tripled on the West Coast and the question of whether this administration cares more about California’s environment than they do about – say – Texas or Virginia, remains unanswered. As the year ends, MARAD would say only that they will review each case individually going forward, on all coasts.
November and December brought us all back down to earth and saw industry focused appropriately on the bottom line. This attention manifested itself in many ways, including but not limited to industry “outrage” at supposedly excessive pilot pay, port fees brought on by questionable security infrastructure upgrades and finally, as announced at this year’s International Workboat Show in New Orleans, the definitive roadmap to success for America’s mid-tier shipyards. As this year’s keynote speaker at Workboat, Matt Paxton, President of the Shipbuilder’s Council of America (SCA), promised a talk that would give his audience guidance on how to expand to find new business, retain what they had and in general, survive the current economic climate. For his part, Paxton did not disappoint. That's the kind of stuff we’ll all need going forward to do the same.
Like you, I don’t know what 2010 will bring. I can guess that the economy, environmental pressures and global piracy will continue to dominate the news. You can bet that any number of new, hot-button issues will crop up, as well. What I do know is that, for the waterfront, 2009 will be hard to beat for drama, excitement and real business challenges. From where I sit, that’s the way it is – and was.
In the New Year, our next MarEx e-newsletter returns to Thursdays, as always. See you then. Thanks to all of you for reading, writing and supporting MarEx over the course of the past twelve months. – MarEx.
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Joseph Keefe is the Editor in Chief of THE MARITIME EXECUTIVE. He can be reached with comments on this editorial at [email protected] and/or join the Maritime Executive ‘Linked In’ group at by clicking http://www.linkedin.com/e/gis/47685>