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> The US has globalized away its maritime industry It hasn't. Jones Act _protects_ the US maritime industry, so it stagnated and died. Nobody wants the US ship

> The US has globalized away its maritime industry It hasn't. Jones Act _protects_ the US maritime industry, so it stagnated and died. Nobody wants the US ships unless they have to use them, they're crap compared to ships from other countries. > and they still can't find builders. That's because shipyards are basically a defense industry subsidiary. So they receive a fixed amount of orders, and it's known for years in advance. The shipyards are also unionized to hell and back, with VERY cushy contracts. So shipyards can't hire temporary workforce for a given project.

ronjakoi 2y ago
I can assure you, shipyards here in Finland are just as, if not more, unionized.
- roenxi 2y ago
  It seems quite likely that Finish unions work differently to US ones. The legal details and organisational traditions matter.
  - jltsiren 2y ago
    It's just free markets in action. Finland is a small country that depends on international trade. Industries must remain competitive or go out of business. Unions that harm the competitiveness too much won't survive in the long term. US domestic market is much larger. Uncompetitive industries can survive on domestic demand. Especially with some regulations that help. It doesn't even have to be explicitly protectionist regulation. Just regulate things the way Americans consider the best, instead of adopting international standards. That can create sufficient barriers to entry to allow uncompetitive industries and uncooperative unions survive.
- arthurjj 2y ago
  This is a common communication problem between Americans and Europeans where we're using the same word to mean two different types of organization. In the US you should replace "union" with "cartel, likely criminal" eg the boilermakers "A federal grand jury in Kansas returned an indictment yesterday charging seven defendants, including five current and former high-level officers of the International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmith, Forgers and Helpers (Boilermakers Union) for their alleged roles in a 15-year, $20 million embezzlement scheme." https://www.justice.gov/opa/pr/two-former-presidents-boilermakers-international-union-among-seven-indicted-20m-embezzlement https://www.justice.gov/opa/pr/two-former-presidents-boilerm...
  - Teever 2y ago
    Maybe the problem isn't with American unions, it's with American corruption. In other words maybe there's just less corruption in Finland.
  - Qwertious 2y ago
    $20M is small potatoes for a $300M ship that's now costing in the billions.
- leshow 2y ago
  I would guess the shipbuilding industry in Finland is also built on subsidy and "protectionism" just like every other successful industry too. A cursory google search shows millions that were made available to shipbuilders: https://www.businessfinland.fi/en/for-finnish-customers/services/funding/innovation-aid-for-shipbuilding https://www.businessfinland.fi/en/for-finnish-customers/serv... I'd bet that's just scratching the surface. The only way any country has been able to develop their productive capacities is through public grants and subsidies. The history of US industry shows the same thing, research in materials, electronics, the internet, etc were all accomplished through publicly funded research.
skhunted 2y ago
Unionized workers can be hired on a temporary basis. By cushy contracts this means that the amount of wealth extraction from workers is not as great as it is in other American industries.
- cyberax 2y ago
  > Unionized workers can be hired on a temporary basis With these unions ("Boilermakers")? No chance. They can officially give their jobs to their _children_ upon retiring. There is a waiting list for apprenticeships. You have to complete 8000 hours of apprenticeship, even if you are already qualified. > By cushy contracts this means that the amount of wealth extraction from workers is not as great as it is in other American industries. WA is ordering ferries at $1.5B per item. They cost 20 _times_ less if ordered from Turkey. This is not "wealth extraction from workers", this is "sucking on the teat of taxpayers".
  - vlovich123 2y ago
    For what it’s worth American workers as a whole make ~20x what Turkish workers do. While American shipbuilders make more than the average while Turkish ones are closer to their average countrymen, the 20x discrepancy in salaries doesn’t seem limited to shipbuilding. So not sure about the characterization of “sucking on the teat of taxpayers” per se vs overall higher regulations and salaries in the US.
    - cyberax 2y ago
      > For what it’s worth American workers as a whole make ~20x what Turkish workers do. It's about 7x. > 20x discrepancy in salaries Not salaries. The end-product costs.
      - vlovich123 2y ago
        Average national salary in the US $60k [1] vs 5k for turkey so closer to 11-12x (the coasts typically pay closer to 70k). So at most unions are costing US built ships to be twice as expensive due to unions and overall higher US wages are responsible for the price difference - difficult to compete on price with people that are willing to work for 1/10th your wage unless you can automate significantly more than them. [1]: https://www.usatoday.com/money/blueprint/business/hr-payroll/average-salary-us/ https://www.usatoday.com/money/blueprint/business/hr-payroll...
theropost 2y ago
Yeah, it's a tough pill to swallow but honestly, the workforce as a whole is kinda coddled at this point. Most people don’t even realize they're being paid more than what they're actually worth. Like, we’re not really creating enough value or building enough stuff that justifies what we think we should be getting. The only reason our value holds up right now is probably cuz of the defense industry flexing its muscle to keep things stable. But let’s be real, as other countries rise up and we start losing our grip as the top dog, we're gonna feel the pain. It could be a slow burn or maybe a faster crash, but either way, it's gonna suck. We’re gonna have to go through some serious hardship to get back to where we think we should be. Not based on what we think we deserve, but what we actually do. And it’s kinda mixed messaging too, right? We somehow believe our labor is more valuable than others, but at the end of the day, it’s gonna come down to working harder. Longer hours, more back-breaking labor, real work, not just sitting in an office chair all day. We’re not entitled to cushy jobs forever, and things are gonna get a lot harder before they get better.
- deleted 2y ago
  [deleted]
observationist 2y ago
What do you think globalizing means? Ships are too expensive to be built to a given level of quality in the US. This means we outsource the expertise, and in this case, even the expertise necessary to tell what a good deal is. They've created a market in which a US based company cannot compete economically, because the cost of production elsewhere will be less. There is no margin by which any competition can take place, whether or not the government throws a ton of money and stopgap incentives into the mix. You can't manufacture chips, small household goods, general purpose clothing, electronics, or a whole slew of other things in the US because our legal regime fundamentally disallows any American participation in those markets through economic disincentivization. If you can't make any profit because you have to pay higher wages or taxes if you manufacture in the US, then you're not going to manufacture in the US, even if you're a patriot. The US doesn't have a rational system designed to maximize value to citizens, it's a hodgepodge of conflicting regulatory grifts designed to maximally benefit the corporations who paid for the lobby. > they're crap compared to ships from other countries. That's exactly what "globalizing" is. You literally cannot, under the current regulatory regime, create a ship building company that can compete with other established interests and competition from other countries. You'd have to relax the arbitrary labor and wage constraints, fix taxes and tariffs for sufficiently long term outlooks that anyone would bother investing. To achieve that, you'd need good faith operators throughout the government willing to rock the boat, and if you think that will ever happen, I've got a bridge in Brooklyn for ya - I'll sell it cheap.
- foota 2y ago
  Other industries seem to be fine competing with other countries. Would there be some greater investment in manufacturing in the US if there were no labor (or environmental) constraints? Sure, but the fact that other industries compete just fine makes me believe it's simply not an economically efficient allocation of resources for labor heavy manufacturing to be done in the US.
  - toomuchtodo 2y ago
    What industries? Steel? Protectionism. Batteries? Protectionism. Solar? Protectionism. Autos? Protectionism. Aircraft? Protectionism. Agriculture? Protectionism. Why? Because efficiency is a tradeoff where you give up security and resiliency.
bgnn 2y ago
Isn't it a similar case with the American busses? They are crap because they're protected? Similar with Boeing too.
- leshow 2y ago
  The decline in quality of out Boeing has coincided with a collapse of the regulatory framework that kept profit extraction limited since the 70's and 80's. Now you've got the worst of both worlds, where the industry is protected and subsidized, production gets off-shored and outsourced anyway while massive profits flow into shareholders pockets in the form of stock buybacks. It's funny that you look at this and blame the protectionist aspect when "protectionism" literally built the industry in the first place. Every country who isn't just getting exploited for their natural resources or labor has built their industry by protecting it.
  - daveguy 2y ago
    When did the regulatory framework collapse? 90s? Was there a specific bill?
    - leshow 2y ago
      Take a person with a full head of hair and remove one hair, are they bald? Remove another one, bald? Clearly not, but if you keep removing hairs at some point you have a head we consider bald. Deregulation has been working like that. It's hard to point to one discrete event. In any case, the process really got going under Jimmy Carter. If we're talking about airlines, I guess you could point to the Airline Deregulation Act. The airline industry had been built in the first place by what people in this thread would call "protectionist" policies. Stock buybacks are a big part of the story as well. These were illegal market manipulation I think from the Great Depression until the 80's under Reagan.
cogman10 2y ago
> The shipyards are also unionized to hell and back, with VERY cushy contracts. The problem here isn't the unions, it's the fact that we privatized building ships. It's yet another example that privatizing all parts of the government is a fundamentally bad idea. Government goals do not align with private industry goals and private industry, particularly in a well captured market like defense and ship building, gets to command insane prices because they know the US will pony up. The reason the US was able to make advanced navy ships right up until the 80s is because shipbuilding was done by public industry. Insanely, Clinton and Reagan started the process of privatizing our fleet capabilities and it's landed us exactly where you think it would. The reason we don't have ice breaker ships being built is because it's a niche market and ship builders are all too happy to say "no" or to charge an exorbitant price so the US military will go away.
- roenxi 2y ago
  I see downvotes at the time I commented, which is unfortunate as ideas should be at least explored. Someone on the internet has been keeping statistics [0] that do suggest the collapse in output happened in the 1980s. But on the other hand, the same stats show a steady decline in the number of companies from 1950 that was only stabilised after the collapse in output, so it is probably arguable that the high-production situation was unsustainable. Economics can be complex. [0] http://shipbuildinghistory.com/statistics/decline.htm http://shipbuildinghistory.com/statistics/decline.htm
  - xyzzyz 2y ago
    Yes, the collapse has happened, but it had not happened due to "privatization" of government shipyard. These were all privately owned shipyard that collapsed. The comment you are responding to is inventing some kind of alternative history that simply has not happened, and probably this is why it's downvoted.
- xyzzyz 2y ago
  Sorry, what are you talking about? None of this is true. Government-owned shipyards were not historically responsible for significant fraction of delivered tonnage. In fact, given the utter atrophy of private shipbuilding industry in US today, I wouldn't be surprised if the percentage of tonnage delivered by government owned shipyards today was higher than ever.
decafninja 2y ago
What’s the general consensus on the state of US Navy ships? The most recent classes seem riddled with various problems - see Zumwalt, LCS, Constellation. I suppose the Ford is relatively ok.
- deleted 2y ago
  [deleted]
themaninthedark 2y ago
The Jones Act only protects a very small part of US shipbuilding industry, those ships which will be used to ship goods between US ports. Somehow the magical thinking here is that, if you allowed everyone to buy ships from anywhere they would buy more American made ships but because it is mandated that you buy American made ships for certain tasks, suddenly the industry is noncompetitive. The reality of the situation is that the Jones Act is the only thing keeping the last vestigial of the shipbuilding industry alive. There are some inefficiencies in the industry it's self but for the most part, the primary drivers for the increased costs were related to the regulatory environment of the US(environmental, worker protection, etc), now there are even greater costs due to network effects of related industries having shrunk or died out. Similar to posts about machine tools or electronic design, everyone talks about how in China its so much easier to get stuff done because the Fab shops are all next door and nothing like that exists in the US, you used to have more steel mills, fabricators and machine shops. Now there are fewer and further apart. Network effects matter.

ronjakoi 2y ago

I can assure you, shipyards here in Finland are just as, if not more, unionized.

roenxi 2y ago
It seems quite likely that Finish unions work differently to US ones. The legal details and organisational traditions matter.
- jltsiren 2y ago
  It's just free markets in action. Finland is a small country that depends on international trade. Industries must remain competitive or go out of business. Unions that harm the competitiveness too much won't survive in the long term. US domestic market is much larger. Uncompetitive industries can survive on domestic demand. Especially with some regulations that help. It doesn't even have to be explicitly protectionist regulation. Just regulate things the way Americans consider the best, instead of adopting international standards. That can create sufficient barriers to entry to allow uncompetitive industries and uncooperative unions survive.
arthurjj 2y ago
This is a common communication problem between Americans and Europeans where we're using the same word to mean two different types of organization. In the US you should replace "union" with "cartel, likely criminal" eg the boilermakers "A federal grand jury in Kansas returned an indictment yesterday charging seven defendants, including five current and former high-level officers of the International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmith, Forgers and Helpers (Boilermakers Union) for their alleged roles in a 15-year, $20 million embezzlement scheme." https://www.justice.gov/opa/pr/two-former-presidents-boilermakers-international-union-among-seven-indicted-20m-embezzlement https://www.justice.gov/opa/pr/two-former-presidents-boilerm...
- Teever 2y ago
  Maybe the problem isn't with American unions, it's with American corruption. In other words maybe there's just less corruption in Finland.
- Qwertious 2y ago
  $20M is small potatoes for a $300M ship that's now costing in the billions.
leshow 2y ago
I would guess the shipbuilding industry in Finland is also built on subsidy and "protectionism" just like every other successful industry too. A cursory google search shows millions that were made available to shipbuilders: https://www.businessfinland.fi/en/for-finnish-customers/services/funding/innovation-aid-for-shipbuilding https://www.businessfinland.fi/en/for-finnish-customers/serv... I'd bet that's just scratching the surface. The only way any country has been able to develop their productive capacities is through public grants and subsidies. The history of US industry shows the same thing, research in materials, electronics, the internet, etc were all accomplished through publicly funded research.

skhunted 2y ago

Unionized workers can be hired on a temporary basis. By cushy contracts this means that the amount of wealth extraction from workers is not as great as it is in other American industries.

cyberax 2y ago
> Unionized workers can be hired on a temporary basis With these unions ("Boilermakers")? No chance. They can officially give their jobs to their _children_ upon retiring. There is a waiting list for apprenticeships. You have to complete 8000 hours of apprenticeship, even if you are already qualified. > By cushy contracts this means that the amount of wealth extraction from workers is not as great as it is in other American industries. WA is ordering ferries at $1.5B per item. They cost 20 _times_ less if ordered from Turkey. This is not "wealth extraction from workers", this is "sucking on the teat of taxpayers".
- vlovich123 2y ago
  For what it’s worth American workers as a whole make ~20x what Turkish workers do. While American shipbuilders make more than the average while Turkish ones are closer to their average countrymen, the 20x discrepancy in salaries doesn’t seem limited to shipbuilding. So not sure about the characterization of “sucking on the teat of taxpayers” per se vs overall higher regulations and salaries in the US.
  - cyberax 2y ago
    > For what it’s worth American workers as a whole make ~20x what Turkish workers do. It's about 7x. > 20x discrepancy in salaries Not salaries. The end-product costs.
    - vlovich123 2y ago
      Average national salary in the US $60k [1] vs 5k for turkey so closer to 11-12x (the coasts typically pay closer to 70k). So at most unions are costing US built ships to be twice as expensive due to unions and overall higher US wages are responsible for the price difference - difficult to compete on price with people that are willing to work for 1/10th your wage unless you can automate significantly more than them. [1]: https://www.usatoday.com/money/blueprint/business/hr-payroll/average-salary-us/ https://www.usatoday.com/money/blueprint/business/hr-payroll...

theropost 2y ago

Yeah, it's a tough pill to swallow but honestly, the workforce as a whole is kinda coddled at this point. Most people don’t even realize they're being paid more than what they're actually worth. Like, we’re not really creating enough value or building enough stuff that justifies what we think we should be getting. The only reason our value holds up right now is probably cuz of the defense industry flexing its muscle to keep things stable. But let’s be real, as other countries rise up and we start losing our grip as the top dog, we're gonna feel the pain. It could be a slow burn or maybe a faster crash, but either way, it's gonna suck. We’re gonna have to go through some serious hardship to get back to where we think we should be. Not based on what we think we deserve, but what we actually do. And it’s kinda mixed messaging too, right? We somehow believe our labor is more valuable than others, but at the end of the day, it’s gonna come down to working harder. Longer hours, more back-breaking labor, real work, not just sitting in an office chair all day. We’re not entitled to cushy jobs forever, and things are gonna get a lot harder before they get better.

deleted 2y ago
[deleted]

observationist 2y ago

What do you think globalizing means? Ships are too expensive to be built to a given level of quality in the US. This means we outsource the expertise, and in this case, even the expertise necessary to tell what a good deal is. They've created a market in which a US based company cannot compete economically, because the cost of production elsewhere will be less. There is no margin by which any competition can take place, whether or not the government throws a ton of money and stopgap incentives into the mix. You can't manufacture chips, small household goods, general purpose clothing, electronics, or a whole slew of other things in the US because our legal regime fundamentally disallows any American participation in those markets through economic disincentivization. If you can't make any profit because you have to pay higher wages or taxes if you manufacture in the US, then you're not going to manufacture in the US, even if you're a patriot. The US doesn't have a rational system designed to maximize value to citizens, it's a hodgepodge of conflicting regulatory grifts designed to maximally benefit the corporations who paid for the lobby. > they're crap compared to ships from other countries. That's exactly what "globalizing" is. You literally cannot, under the current regulatory regime, create a ship building company that can compete with other established interests and competition from other countries. You'd have to relax the arbitrary labor and wage constraints, fix taxes and tariffs for sufficiently long term outlooks that anyone would bother investing. To achieve that, you'd need good faith operators throughout the government willing to rock the boat, and if you think that will ever happen, I've got a bridge in Brooklyn for ya - I'll sell it cheap.

foota 2y ago
Other industries seem to be fine competing with other countries. Would there be some greater investment in manufacturing in the US if there were no labor (or environmental) constraints? Sure, but the fact that other industries compete just fine makes me believe it's simply not an economically efficient allocation of resources for labor heavy manufacturing to be done in the US.
- toomuchtodo 2y ago
  What industries? Steel? Protectionism. Batteries? Protectionism. Solar? Protectionism. Autos? Protectionism. Aircraft? Protectionism. Agriculture? Protectionism. Why? Because efficiency is a tradeoff where you give up security and resiliency.

bgnn 2y ago

Isn't it a similar case with the American busses? They are crap because they're protected? Similar with Boeing too.

leshow 2y ago
The decline in quality of out Boeing has coincided with a collapse of the regulatory framework that kept profit extraction limited since the 70's and 80's. Now you've got the worst of both worlds, where the industry is protected and subsidized, production gets off-shored and outsourced anyway while massive profits flow into shareholders pockets in the form of stock buybacks. It's funny that you look at this and blame the protectionist aspect when "protectionism" literally built the industry in the first place. Every country who isn't just getting exploited for their natural resources or labor has built their industry by protecting it.
- daveguy 2y ago
  When did the regulatory framework collapse? 90s? Was there a specific bill?
  - leshow 2y ago
    Take a person with a full head of hair and remove one hair, are they bald? Remove another one, bald? Clearly not, but if you keep removing hairs at some point you have a head we consider bald. Deregulation has been working like that. It's hard to point to one discrete event. In any case, the process really got going under Jimmy Carter. If we're talking about airlines, I guess you could point to the Airline Deregulation Act. The airline industry had been built in the first place by what people in this thread would call "protectionist" policies. Stock buybacks are a big part of the story as well. These were illegal market manipulation I think from the Great Depression until the 80's under Reagan.

cogman10 2y ago

> The shipyards are also unionized to hell and back, with VERY cushy contracts. The problem here isn't the unions, it's the fact that we privatized building ships. It's yet another example that privatizing all parts of the government is a fundamentally bad idea. Government goals do not align with private industry goals and private industry, particularly in a well captured market like defense and ship building, gets to command insane prices because they know the US will pony up. The reason the US was able to make advanced navy ships right up until the 80s is because shipbuilding was done by public industry. Insanely, Clinton and Reagan started the process of privatizing our fleet capabilities and it's landed us exactly where you think it would. The reason we don't have ice breaker ships being built is because it's a niche market and ship builders are all too happy to say "no" or to charge an exorbitant price so the US military will go away.

roenxi 2y ago
I see downvotes at the time I commented, which is unfortunate as ideas should be at least explored. Someone on the internet has been keeping statistics [0] that do suggest the collapse in output happened in the 1980s. But on the other hand, the same stats show a steady decline in the number of companies from 1950 that was only stabilised after the collapse in output, so it is probably arguable that the high-production situation was unsustainable. Economics can be complex. [0] http://shipbuildinghistory.com/statistics/decline.htm http://shipbuildinghistory.com/statistics/decline.htm
- xyzzyz 2y ago
  Yes, the collapse has happened, but it had not happened due to "privatization" of government shipyard. These were all privately owned shipyard that collapsed. The comment you are responding to is inventing some kind of alternative history that simply has not happened, and probably this is why it's downvoted.
xyzzyz 2y ago
Sorry, what are you talking about? None of this is true. Government-owned shipyards were not historically responsible for significant fraction of delivered tonnage. In fact, given the utter atrophy of private shipbuilding industry in US today, I wouldn't be surprised if the percentage of tonnage delivered by government owned shipyards today was higher than ever.

decafninja 2y ago

What’s the general consensus on the state of US Navy ships? The most recent classes seem riddled with various problems - see Zumwalt, LCS, Constellation. I suppose the Ford is relatively ok.

deleted 2y ago
[deleted]

themaninthedark 2y ago

The Jones Act only protects a very small part of US shipbuilding industry, those ships which will be used to ship goods between US ports. Somehow the magical thinking here is that, if you allowed everyone to buy ships from anywhere they would buy more American made ships but because it is mandated that you buy American made ships for certain tasks, suddenly the industry is noncompetitive. The reality of the situation is that the Jones Act is the only thing keeping the last vestigial of the shipbuilding industry alive. There are some inefficiencies in the industry it's self but for the most part, the primary drivers for the increased costs were related to the regulatory environment of the US(environmental, worker protection, etc), now there are even greater costs due to network effects of related industries having shrunk or died out. Similar to posts about machine tools or electronic design, everyone talks about how in China its so much easier to get stuff done because the Fab shops are all next door and nothing like that exists in the US, you used to have more steel mills, fabricators and machine shops. Now there are fewer and further apart. Network effects matter.