Our 2011 advice to West Coast ports, and to the workers whose jobs depend on their operations, is to batten down the hatches. Already reeling from a two-year economic drought, the newest port threat comes from cash-starved local governments coveting port revenue.
The city of Long Beach showed how easy it is to raid port revenue with a seemingly innocuous charter amendment placed on November’s ballot that strips away hundreds of millions of dollars from the port.
With little public discussion and no analysis, Long Beach city council members broke the arms length relationship that long insulated the port from the chaos of everyday city politics. The Port of Long Beach now is simply viewed by City Hall as a revenue source for other unrelated city priorities – and not a generator of jobs. Projects needed to keep the port competitive – and generating jobs for tens of thousands of people – may be jeopardized because of the political whims of shortsighted politicians.
The port piracy couldn’t have come at a worse time. Big West Coast port centers – Los Angeles-Long Beach, Oakland, Seattle and Tacoma – have enjoyed a long successful run, but their continued dominance in Pacific trade is threatened. They are under increasing competitive pressure from Canadian and Mexican ports, and from Gulf and East Coast ports that will benefit soon from an enlarged Panama Canal in 2014.
The financial challenges facing the city of Long Beach are no different than those facing the city of Oakland or the city of Seattle. If it worked so well in Long Beach, what is to stop local governments from trying to tap into the taxing authorities of the Seattle and Tacoma ports? Is that what’s coming in 2011? Let’s hope not.