OPINION:
Congestion is easing at the nation’s West Coast ports. Average wait times are down to a mere 18 days, and there are only 70 or so ships awaiting a berth, down from 109 in January.
For once, the Biden administration is doing the right thing — pumping in $17 billion from the recently passed infrastructure bill to improve coastal ports, inland ports and waterways, and land ports of entry along the border.
The problem is not solved — wait times were essentially zero at West Coast ports before the pandemic. But the supply chain is beginning to adjust to its new normal and get things moving.
Congress is another story. The House wants to solve the problem by blaming the ships at sea. It says they are colluding amongst one another to have their extremely expensive assets stuck at sea and that if their collusion can be ended, wait times would go away.
If this seems fanciful, it’s only because it is.
The House-passed Ocean Shipping Reform Act, HR 4996, seeks to break up these shipping cartels that they allege have colluded agreed among themselves to have their resources idling off the California coast rather than efficiently deliver their goods and go on to other profitable voyages. This, even though the U.N. said in a report within the last two years that shipping was not plagued by anti-competitive behavior.
It also seeks to prioritize which goods would be unloaded first — a bureaucratic nightmare in the making if ever there was one.
If the idea is to assign blame and punish those responsible, then we probably will need multiple bills. We had a pandemic, which left a lot of Americans — not all — with their income still coming in, free time on their hands like never before and shopping-from-home options that seemed unfathomable two years ago.
The result was a Christmas-rush-sized bottleneck that lasted for nearly two years. Infrastructure was stretched beyond its breaking point. COVID-19 restrictions meant closures and far fewer workers available — the Department of Labor says roughly 30% of job openings are not currently filled. Regulations regarding freelance employment in California meant fewer truckers there to carry away cargo and clear out the containers that now stand idly in the way of progress at ports throughout the West Coast.
Blame California for its overweening regulations. Blame the unions for pressuring the California legislature into outlawing their independent competitors. Blame the virus for setting up these market conditions and for dramatically increasing demand for shipments of medicine and medical devices. Blame those blasted “Click Here to Purchase” buttons.
But the ships at sea?
The Senate has a somewhat better proposal. In contrast to the House bill, the Senate bill still sets guardrails of fairness but does not pick winners and losers among different shippers or fundamentally disrupt ocean networks. With some modifications, it might even help the situation.
The House-passed version does not address landslide supply chain congestion caused by competition for containers, chassis and truckers. The shortage of labor and containers will not be solved by regulators targeting ocean carriers.
There are indeed a lot of kinks in the system — a lot of areas where Congress could change or reduce the rules to help move goods from businesses and farms to port for export. Market forces and local rules of the road would do far better than Congress at determining the order in which goods are unloaded in the nation’s ports.
Instead of focusing on these problems, the House blamed companies whose assets are stranded due to the crisis Congress is attempting to solve. Eliminating that backlog at West Coast ports will make it easier to export goods and reduce other consequences of supply chain breakdowns, such as those bare shelves you see at the grocery store.
Part of the problem will be solved by those infrastructure projects coming online. Another part will be resolved as companies respond to increased demand with increased capacity to process orders. And another part will be solved by the disease receding and rules relaxing in response.
But none will be solved by blaming the ships at sea. It’s time Congress recognize this and move on to other approaches.
• Brian McNicoll, a freelance writer based in Alexandria, is a former senior writer for The Heritage Foundation and former director of communications for the House Committee on Oversight and Government Reform.
