On the Right Track

We received this in an e-mail from someone overseas. The writer was not identified but we couldn’t help noting how it fitted in with what we’ve been promoting.

According to the author of these words, some folks would have us believe, “that the government is no match for the private sector in efficiently getting large and important things done. But is that really true?”, (s)he asked. “Let’s clear our minds for a moment, push our upbringing to one side, and remember that the American government has landed men on the moon, created great dams, marvelous national parks, an interstate highway system, the peace corps, built up an incredible military machine (ignoring for the moment what it’s used for), student loans, social security, Medicare, insurance for bank deposits, protection of pension funds against corporate misuse, the Environmental Protection Agency, the National Institutes of Health, the Smithsonian, the G.I. Bill, and much, much more. In short the government has been quite good at what it wanted to do, or what labor and other movements have made it do, like establishing worker health and safety standards and requiring food manufacturers to list detailed information about ingredients.”

That was perfect. It’s just what we needed to make our point. And our point is this. “At the stroke of a pen”, (to use George Marshall’s famous words), we could revitalize our shipyards. As we said in yesterday’s column, Korea has done it, India is doing it, and we, by the way, were the first to do it. Although most of our magnificent shipyards have since been destroyed, the machinery to rebuild and reopen them is still in place. It’s called Title XI.

The Maritime Administration describes Title XI as the Federal Ship Financing Program that provides for a full faith and credit guarantee by the United States Government for the purpose of promoting the growth and modernization of the U.S. merchant marine and U.S. shipyards. The program enables owners of eligible vessels and eligible shipyards to obtain long-term financing with attractive terms, and permits guarantees in an amount not exceeding 87.5% of the actual cost of the eligible vessel.

Wow!! What are we waiting for? With our world-wide patented storage and retrieval system for container ships reserved exclusively for U.S. use, coupled with this Title XI guaranteed loan program, investors should be clamoring to get in on this windfall. Right. Except for one little fly in the ointment.

The author of that e-mail quoted above hits the nail right on the head when (s)he correctly writes that the government has been quite good “at what it wanted to do”. The disinterested Senate Appropriations Committee has approved a paltry $ 30 million for Title XI commercial ship construction loan guarantees, and that’s why we can’t compete with generously subsidized foreign shipyards. It’s not the “wage differential”… that’s hogwash.

[The New York Times reported last week that “about 2.2 million borrowers that took out sub-prime loans from 1998 to 2006 are likely to lose their homes”. That translates into about 10 million desperate people. A fully-funded Title XI can create jobs for those unfortunate Americans.]