As global food prices continue to skyrocket, regulations that entrench union special privileges are delaying critical food shipments from reaching their intended destinations. According to the Center for Global Development and The Los Angeles Times, union-imposed labor requirements have slowed food shipments because aid agencies are forced to rely on U.S.-flagged ships for transportation:
“ . . . US policy compounds the problem by requiring that food aid must be purchased and packaged in the United States and shipped mainly on US-flagged ships. Thus, a good chunk of the US food aid budget gets diverted to higher distribution and transportation costs, which are also going up as a result of oil price hikes and rising freight costs.”
The Center for Global Development also estimates that these regulations increase the cost of foreign assistance by up to 30%, eroding the benefits of aid through massive overhead costs. Union officials support this wasteful policy because it forces ports to rely on a heavily unionized workforce that generates millions of dollars in dues payments each year.
This isn’t a new problem, either. Union-boss-inspired maritime regulations have plagued the delivery of foreign aid consignments for over a decade. With food prices soaring throughout the Third World, however, now is an ideal time to jettison these obstructionist compulsory unionism privileges.
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Quick Response
Hey Scott,
Thanks for your thoughtful post. The relationship between U.S.-flagged ships and maritime unions is pretty straightforward - American ships are almost entirely manned by unionized sailors. These unions support cargo preference laws that require U.S.-flagged vessels to carry a certain percentage of all federal shipments. This has the perverse effect of limiting the pool of ships available for transporting foreign aid. Although our cargo preference laws are great for maritime unions, they prevent us from responding quickly to developing food shortages.
Mr. Collins, While your post
Mr. Collins,
While your post is thought provoking, I find the linkage between what you identify as the problem -- the policy of shipping on only US-flagged ships -- and union policy to be somewhat unclear. You do mention that unions seem to support this stance, but I see no warrant for why this is a problem with unions and not a problem with US policy in general. You say "union-imposed labor requirements have slowed food shipments" but then your supporting quotation says "US policy compounds the problem" so I'm wondering whether it is union policy (and if what which one(s)) or US policy thats the problem. You do call for reform in foreign assitance policy, is your argument that unions will block these reforms? It's also unclear why unions would have such an incentive to support this policy. Can't union dockworkers still load ships that aren't US-flagged? Who else would load them at these docks?