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  • On U.S.-Bound Cargo, Europeans Understand What Congress Doesn't

    Container Ships

    Yesterday, the European Commission published a paper which looked at the U.S. mandate requiring scanning of 100 percent of the U.S. bound cargo containers. The July 1, 2012, deadline for implementation is drawing nearer, and U.S. trading partners are beginning to get engaged. The conclusion of the report – that the 100 percent mandate is the wrong course for the global supply chain – is dead-on in its assessment.

    The European Commission is nervous of this mandate for the same reasons Americans should be. It’s costly-and even more so because most of the foreign ports do not have the right infrastructure in place to do this kind of blanket screening. This places an even larger burden on the private sector as it attempts to do business.

    The need for such a mandate was originally couched in the idea that the supply chain, and therefore cargo containers were not secure. Yet, as I put out in a recent paper, the current risk based model for container security can and does work well to spot threats in the global supply chain. Sure, more could be done to make these efforts better and more expansive-but nothing about this approach is inherently flawed. Under the new approach, however, it will be more difficult to get goods from point A to point B-a problem which the European Commission aptly recognizes will directly affect consumers.

    Concerns over the turn to 100 scanning have largely fallen on deaf ears inside the United States. Members of Congress aren’t engaged on the issue or are scared that repealing such a mandate would make them look bad on security. At the same time, trading partners are more and more frustrated over 100 percent scanning-seeing it at best as a trade impediment, and at worst, straight out protectionism.

    The European Commission isn’t exactly a free market champion. But it doesn’t take a dyed-in-the-wool capitalist to realize that this mandate is bad for the global economy. The global and U.S. economies are already bleeding-why should Congress shoot another bullet?

    Posted in Ongoing Priorities [slideshow_deploy]

    4 Responses to On U.S.-Bound Cargo, Europeans Understand What Congress Doesn't

    1. Drew Page, IL says:

      When the mushroom cloud appears over a U.S. costal harbor or city, how many will be saying "it costs too much to inspect all those cargo containers?" and Why wasn't something done to prevent this?" Maybe we can still blame it on George Bush.

      If the unthinkable does happen, will it really matter whose to blame?

      Maybe we could put a whole lot of people to work by hiring cargo container inspectors. And yes, I think every piece of passenger luggage should be checked and inspected for explosives before being put on a plane. The same goes for cargo planes.

      Yes, it will cost more to to provide this higher degree of inspection and security. On the other end of this spectrum, we could probably see a reduction in air fares if the airlines eliminated all security procedures entirely.

    2. Lloyd Scallan - New says:

      With today's techknowledgy, suitcase nukes, chemical agents that can be carried in a ball point size container, and so on, scanning 100 percent of cargo containers that are bound for the U.S. is absolutely absurd. If this useless mandate is put into practice, it will accomlish the underlying result; to continue to raise cost, thus forcing every person to pay more to live with a minimal

      intrusion by the federal government.

    3. Rick74 says:

      "Straight-out protectionism"?

      This might be a good thing.

      If we can be more "protected" AND make imported goods so expensive that manufacturers are convinced to hire and employ American workers and use once-viable American plants to actually make the products that we consume, isn't this a win-win?

      I may be more serious about this that I was several years ago. A ridiculous unemployment rate and a similar trade deficit, combined with parties in Washington that will not "adjust" taxes and benefits to benefit either employment or the economy makes this idea more tolerable.

      Combine it with a new tax on oil – especially the bulk oil used for cargo ships – to raise the transportation costs for imported goods and we might have a policy – bereft of tariffs or "unfair" trade practices – that tries to level the playing field for the first time in the PW (Post-Walmart) Era.

    4. Dave - Chelsea, MI says:

      Let's start off with the proper premise: "Bad guys are not necessarily dumb guys." Why in the world would any "bad guy", who spent countless time, energy and money to acquire any weapon of mass-destruction ship those "tools" through a USA Port of entry? Or, do any of you work under the belief that Narco-bad guys ship all the illicit drugs coming into the USA through Ports?

      All security measures should be a multi-layer and risk based. While many readers might believe rules, regulations and Federal fiat can make us perfectly safe, that conclusion WILL leave us perfectly broke financially (of course, all the other actions of our elected leadership has certainly put us on that path anyway).

      You may not want to weigh the economics of security as it relates to supply-chain implications though an overly simplistic statement of comparing cost savings to catastrophic events, but monetary catastrophic events can be just as devastating as biological and explosive weapons, likely with far longer lasting effects.

      Technology does NOT exist to effectively and accurately perform 100% inspections. Consider that we experience false-postives 5% of the time, which shuts down port operations…no matter how many times an elected official "mandates" something impossible, they don't learn that unlike in the movies, mission impossible is, well, impossible!

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