An Early Fall

According to a preliminary analysis completed by a well-known engineering firm, the Jasper County port that South Carolina and Georgia intend to build could generate $ 2.3 billion by the year 2020.

Note that the engineering firm, and the ports, were careful to refer to the analysis as “preliminary”. And note the judicious use of the word “could”. That means that those behind the preliminary analysis aren’t hanging their hats on any of the estimates published.

The analysts, of course, were paid to inform the residents (the taxpayers) of Georgia and South Carolina that container volume “should” grow by 6.7 percent annually through 2025 and then slow to 5.3 percent annually from 2025 to 2050. Along with those caveats, a former SC State Ports Authority official issued still another … those were numbers “that we must keep refining”, he said.

Two results are hoped for, and anticipated. The first is that hundreds of millions of dollars would be transferred from the taxpayers to the port authorities, and finally when the taxpayers began to realize that all estimates were just pie-in-the-sky, and that the new terminal was an absolute waste of time and money, well, those caveats were there, weren’t they?

We have no idea how the analysts arrived at the 6.7 percent and the 5.3 percent growth factors. We do know, however, that the rest of the world is experiencing economic failings that have never been felt before. Those analysts and port authorities know full well, for example, that the governor of New York reminded his constituents last week that although the full impact of Wall Street’s recent disasters “… may not be known for months or even years, the fact that financial services firms that were able to survive the Great Depression, world wars, and the September 11th attacks, collapsed under the weight of the current financial crisis is cause for grave concern”.

In fairness to all, it’s time for some straight talk:
• We reported last week that a story in the Seattle Times indicated that the Puget Sound ports of Seattle and Tacoma, the third-largest container center in the country, have both seen a falling off of container traffic, and according to Port Tracker, container imports throughout the nation’s ports will be down some 6 percent this year.
• Business Times reported that, according to government reports showing that the economy was rapidly weakening, orders for costly US manufactured goods plunged in August and the number of workers filing new claims for jobless benefits shot up. In the ninth straight month of job losses, a staggering 760,000 jobs have disappeared this year, the government stated.
• Worldwide, the outlook is no better according to Mr. Dan Ryan, APL’s Greater China president. “The current situation in Asia/Europe is far worse that during the last cyclical downturn,” he stated, and he called the previously booming Asia/Europe trade “precipitous”.

So, if Port Tracker sees a 6 percent downturn of container traffic nationally, and if the government admits that the economy is rapidly weakening, and if the once booming Asia/Europe trade is now “precipitous” … how can respected analysts justify those 6.7 and 5.3 percent growth numbers?