Wednesday, May 14, 2014


Editor's note: In June of last year we published this post and later another on the Custom's Service's "Yarn Forward" rule mentioned in this post. Since then nothing has improved, but we are getting closer to an opportunity to vote some mill stones around our neck types out of Congress.
6/17/2013. Editor's Note: 1/8/15 Well, we voted some of the "millstones out", so far no change. Time to re-register independent? 1/23/16 Over a year and no change, realy time to register independent. 


File:Stevedores ny 1912.jpg
 Photograph by Lewis Hine, circa 1912 ,Wikipedia Commons
Editors Note: One of our regular corespondents "Bill" is a marine cargo surveyor. He sent an interesting E-mail which we reprint below. In turn our Johnas Presbyter penned an interesting reply that with permission we thought we'd share with the public. If you want to understand the descent of the United States as a manufacturing nation, and its potential for a rebound if our business communities and Congress could act in effective coordination, (if our Congress could act at all would be an improvement) a look at the world through the eyes of experienced marine surveyors would be a revelation to most Americans.

Bill's E-mail

Subject: Tornado damage at South Locust Point

Last week a tornado crossed Baltimore harbor and tore a section of roof off one of the warehouses at South Locust Point Marine Terminal, just between the cruise ship terminal and Fort McHenry.  This warehouse is used to store rolls of printing paper, generally imported from Europe.  Each roll is cut to exact dimensions and is labeled for the particular edition of a magazine or catalog it is intended for.  They’re still scrambling to sort and segregate the damaged rolls for my inspection next week.

Johnas' Reply

Tornadoes happen but  the story of the industry you told required some real screwing up by our own Southern businessmen and of course the federal government that we were bound to by force of arms. I would be willing to bet you that the ship loads of semi processed pulp wood from the southern pine forests of East Texas, Louisiana, Arkansas, Mississippi, Alabama, Florida, Georgia, and South Carolina that we see leaving New Orleans and Mobile provided much of the pulp for the European paper makers/ custom cutters. Then a big portion of their product is shipped back here (value added). and sold to American publishers at way more profit per ton then we ever made on the pulpwood, making the export of the pulp wood a net zero contribution to our balance of payment sheet. There can be no doubt that we can duplicate this service in the South for less than Europeans who have both higher labor costs than what we typically pay our "good ole boys and girls" to work in plants , lower pulpwood costs, and much lower transportation costs of the final product to publishing centers like New York and Nashville. 

 This is starting to remind me of the "yarn forward rule" in Textiles. The Customs Service lets certain designated nations import yarn from the Carolinas, fashion linens and garments, and export the finished product to the United States duty free, and under some circumstances even carrying a "made in the USA" label. Of course the Chinese bought up most of the textile plants in these nations so the low paying jobs remain in the targeted nation while the profits go to China which was not our intention. Worse, China routinely abuses the arrangement even shipping some work meant for these designated nations to China and transshipping the product to the USA duty free through the designated nation under the "Yarn Forward Rule". We owe China billions of dollars, but if we effectively audited and enforced the Yarn Forward rule we would discover that they owe us millions if not a billion of more in penalties for cheating on this rule. There is no reason for the Yarn Forward Rule relegating us to producers of semi raw  product to feed a Chinese owned but globally located textile industry exporting billions of dollars of product to the American Market. It should be rescinded, and the authorizing statute amended.

New American Textile mills can now leapfrog over existing technology and build with the latest technology reducing labor costs, saving on our own Southern cotton, reducing transportation costs to American and Canadian markets, we can probably now make shirts and sheets as cheaply as China or any Third World nation. The big single production line requiring an army of labor is fast becoming a thing of the past. Labor savings are no longer the driving cost for manufacturing in newer plants. We have to find a way to close out Yarn Forward, investigate and collect on the cheated revenues, and find a way to open U.S. Textile new technology based plants without erecting protective tariffs. We can dominate the American market and we can probably compete on the global market in this area if we leapfrog technology. 

 The case of the paper cutters who lost product in the tornado doesn't seem to involve fraud and abuse of the U.S. Customs regulations like textile, just really short sighted business and governmental decisions. We could dominate the U.S. market because if we set our minds to developing this industry we have the natural advantages of abundant raw material, and close proximity to market , and again an opportunity to leapfrog technology. It should be no wonder to Americans that the only Merchant Marine Academy of America's five that offers a post graduate degree does not offer a higher diploma in the nautical arts and sciences, that's why we have the Coast Guard's officer licensing examination system, but in economics, the driver behind all global merchant marine activity. Too few Americans including all of Congress have any clue to what goes on in our ports. But to an astute eye an event like this tornado opening up a hole in a roof in a port to let a small portion of the local public peer in where there was local media coverage , can be a revelation. Thanks for giving us a look into the daily world of the marine cargo surveyor. I'm going to scrub your personal identity information from your e-mail and use it in a blog post. Lets let a little more of the American public look in the warehouse.

American Admiralty Books Safety & Privacy Policies (Attention EU Visitors , possible "cookie" encounter ahead) 


Border Insecurity: Why Big Money, Fences, and Drones Aren't Making Us Safer 


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