We hear a lot about port congestion especially on the West Coast. In shipping there is always another way and it seems that the NVOCC’s are coming out of the woodwork offering East Coast and Gulf Coast alternatives to the West Coast routes. They are prospering. I am not sure the regulars are in the container trades. So how does this work?
NVOCC’s act likes carriers and book cargoes but they do not operate vessels but charter slots or ships on the spot market or for the customer. They are more than forwarders. But the point here is that they can be very nimble.

Until about wo decades ago shipping was the world’s most extensive mom-and-pop operation. Most companies were family-owned and most operated under the parochial protection of states where the vessels were flagged and where the owners lived or had some relationship other than registry.  Debt financing was the way ships were bought and working capital came from lines secured by equity. This has all changed. Shipping has become financialized. What does this mean?

It seems that the Transportation Security Administration has yet again a new rule. In order to get a Transportation Worker’s Identification Credential or “TWIC” the applicant must present a US passport. As my long-suffering readers know, I am no fan of the TSA. I saw the announcement of this seismic change in the back pages of several trade journals. My first reaction was that the TSA had made yet another irrelevant change in the government’s most irrelevant organization.

Read more and view the video after the jump.

Recently it was announced that the US Marine Corps was contemplating deploying US Marines on foreign-flag ships. This will not do. The second Bush administration pushed the hiring of mercenaries to the furthest extent in Iraq and Afghanistan. They were called “contractors.” Americans have had distaste for mercenaries since the Hessians. In doing so that administration essentially broke the back of proper state function in war and the Westphalian monopoly on state violence valid since 1648. An unintended consequence of these acts has been the development of an attitude that the government can contract out anything on the world market. This reinforces the attitude existent that the DoD use United States flagged ships only when it must after tortuous and complex arguments against them and then only when publicly exposed and compelled thereafter to use domestic tonnage. This is not the first time this show has come down the road. In the current political climate it will not be the last.

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The situation in the Persian Gulf seems to have become more complicated. Recently the Maersk Kensington was “harassed” by apparent warships flying the Iranian flag. Now the Maersk Tigris has been boarded and directed to anchor after Iranian forces fired across her bow. Here are my thoughts about this situation. One must carefully separate the political from the legal here. Clearly there are substantial political implications with this matter going on and the negotiations the US government and the Iranian government are having as to the Iranian nuclear capability. However, we also must be careful not to equate the two matters. What is happening with the vessels seems on one hand to be a minor matter when compared to the negotiations. On the other hand it is a window into the Iranian state and the Iranian government which if viewed in certain ways is unsettling.

Read more and watch the video after the jump.