How to reduce Alaska freight costs?

[Greg]

Relative to the Jones Act, there are definitely some down side and the U.S. domestic shipping industry is over regulated, but there are a lot of actual decent reasons for it in a general sence.

I would rather see deregulation and favorable tax treatment and keep the Jones act rather than keeping the regulations and ditching the act. Unless of course fighting the next war with no US merchant ships sounds like a good idea.

Trying to keep your merchant fleet in being artificially with the Jones act is like trying to curb inflation with price controls. There will just be no shipping at all, and air freight to Alaska (and eventually smuggling) just like price controls lead to empty shelves and eventually the only market is the black market.

[toad]

The Jones Act doesn't hurt just Alaska it also hurts domestic shipping on both the lower 48 continental coasts. By requiring overpriced shipping rates, traffic moves instead on trains, trucks, and aircraft. So now days not much in the way of specialized coastal ships gets built. Port cities don't have the advantage they used to have over interior cities that aren't near navigable rivers. Small costal ports don't see the near the shipping they should be getting.
Both ship building and heavy freight shipping gets hurt by the Jones act.
I vaguely remember a science fiction story in which fixed route shipping gets killed by shipping craft that could float over land or water at high speeds.

[Netpackrat]

Relative to the Jones Act, there are definitely some down side and the U.S. domestic shipping industry is over regulated, but there are a lot of actual decent reasons for it in a general sence.

I would rather see deregulation and favorable tax treatment and keep the Jones act rather than keeping the regulations and ditching the act. Unless of course fighting the next war with no US merchant ships sounds like a good idea.

Trying to keep your merchant fleet in being artificially with the Jones act is like trying to curb inflation with price controls. There will just be no shipping at all,

Yes, this. The total number of Jones Act compliant ships in the entire US merchant marine fleet is less than 100.

[HTRN]

Too bad we can't talk UPS into converting a retired aircraft carrier into a really BIG Brown Truck....

You can buy a working container ship for less.

[Old Grafton]

Too bad we can't talk UPS into converting a retired aircraft carrier into a really BIG Brown Truck....

You can buy a working container ship for less.

I just joked about aircraft carriers because they're built in US shipyards and (hopefully) made of US steel. Heck, I doubt you could even find enough people to wade through all the government regulations banning their re-purposing and re-use.

[toad]

I had this sudden vision of heavy lift helicopters flying off the carrier, taking cargo containers back and forth. Fresh crabs for San Francisco and old hippies for bait in Alaska.

[AlaskaTRX]

I had this sudden vision of heavy lift helicopters flying off the carrier, taking cargo containers back and forth. Fresh crabs for San Francisco and old hippies for bait in Alaska.

The crab wouldn't taste very good if that's what you want to feed them...

[toad]

I was thinking more in terms of bait for Bears. Of course that might not be a large enough market. Also come to think of it if you want a case of crabs San Francisco probably has more than enough cases of crabs.

[Vonz90]

Relative to the Jones Act, there are definitely some down side and the U.S. domestic shipping industry is over regulated, but there are a lot of actual decent reasons for it in a general sence.

I would rather see deregulation and favorable tax treatment and keep the Jones act rather than keeping the regulations and ditching the act. Unless of course fighting the next war with no US merchant ships sounds like a good idea.

Trying to keep your merchant fleet in being artificially with the Jones act is like trying to curb inflation with price controls. There will just be no shipping at all,

Yes, this. The total number of Jones Act compliant ships in the entire US merchant marine fleet is less than 100.

... and it would go up if we reduced the regulation and tax burden on the domestic shipping, which is what I just said we should do (because it would be cheaper to run domestic shipping).

If you keep the over regulation and get rid of the Jones Act you will get "0" domestic ships because everyone will just switch to flags of convenience.

Total US merchant fleet = 450 ships (all types, not just cargo)
Total US owned ships which fly other flags = over 1000.

Most of the western owned ships are not too bad, but you have no idea how crappy many companies will allow their ships to get and how crappy many of the crews are. But the main reason that companies foreign flag is costs, primarily crew costs (as most of the western big companies take reasonable care of the their ships). Operating costs for US ships can be 65% higher and that does not even count the favorable tax treatment which most countries give their merchant fleet but we don't.

The Jones act is not the problem. I'm sure a Mexican trucking company with Mexican drivers following Mexican safety regulations could operate cheaper and drive down cargo rates on the East Coast too, do you want that? It is the same thing.

I will say it again, the problem is not the Jones Act, it is regulation which makes the cost of operating US shipping prohibitive for many uses.

BTW - to get out of the Jones Act when shipping to AK, all one would need to do is reload in a Canadian port. I am pretty sure the driver for the AK shipping costs is volume as in general sea borne shipping rates have been rather suppressed lately.

[Greg]

Actually I think it's both.

The real problem is the regulatory and tax burden, I agree. The only way to fix the situation is to undo the awful regulatory and tax situation.

The Jones Act is an attempt at a fix, but it's the wrong fix and it does in fact make things worse. Getting rid of the Jones Act would at least make it possible to get freight into and out of Alaska without paying exorbitantly. But as you said, it would have the effect of outsourcing shipping. If you don't care about US flagged shipping and all you care about is shipping freight to and from Alaska, it's a sufficient fix.

If you care about having a US flagged merchant fleet, the only real solution is to improve the tax and regulatory situation such that having your ships be US flagged isn't punitive.