Tags: West Coast | port | labor | shutdown

US Chamber of Commerce's Donohue: West Coast Port 'Disaster' Not Over

By    |   Thursday, 02 April 2015 07:20 AM EDT

Remember the near-shutdown of West Coast ports during the winter, caused by a labor conflict?

The issue is over, right?

Maybe the labor conflict is. But, "that doesn't mean congestion that built up during months of slowdowns and shutdowns will be cleared anytime soon," write Thomas Donohue, CEO of the U.S. Chamber of Commerce, Matthew Shay, president of the National Retail Federation, and Jay Timmons, president of the National Association of Manufacturers, in a commentary for CNBC.

"Disaster. Catastrophe. Fiasco. Pick your word: West Coast ports proved for the second time in just over a decade that they can't provide the predictability and dependability shippers count on."

So can the West Coast ports be saved? "Only if labor, management and other parties come together to each do their part," the luminaries say.

"If they don't, the global supply chain and free market forces will simply move on and find less risky options of getting goods to market." Labor and management must make peace and "find a way to evolve their negotiations to address today's global supply chains."

"What we need is a path to ensure that our ports — and the United States — always remain 'open for business.'"

Meanwhile, in his latest market commentary, Byron Wien, vice chairman of Blackstone Advisory Partners, takes aim at several myths that he says are commonly believed by investors.
  • "American [economic] exceptionalism is a thing of the past." But, "looking at the performance of the U.S. equity market, you would certainly think that American companies have a competitive advantage." The S&P 500 index has tripled in the past six years, besting the eurozone and Japan. And the dollar has outperformed every major currency except the Swiss franc. A Goldman Sachs study shows that U.S. GDP has risen 12.9 percent from its 2009 low, compared with 3.8 percent for the eurozone and 8.9 percent for Japan.
  • "The price of oil is likely to stay low for a long time." U.S. oil prices have plunged 55 percent since late June to below $50 a barrel, and many experts have forecast the slump will continue to $30. But "taking a look at past periods when the price of oil has had sharp declines shows a consistent pattern of rapid, not slow, recoveries," Wien writes.
He also notes that the myth that "Europe's economy is in a slow growth deflationary trap" is just that — a myth. "In Europe, the Purchasing Managers Index for both manufacturing and services is currently signaling economic expansion. With the European Central Bank beginning a program of monetary easing, growth should pick up even further."

The last myth he debunks is that "Abenomics is not working, and Japan is in danger of falling back into a recession."

Wien explains, "The increase last year in the value added tax in Japan dealt consumers a powerful blow, but the drop in the price of oil was the equivalent of 2.1 percent of GDP, and this was, according to a study by Observatory Group, bigger than the impact of the tax increase, he notes, adding that "the decline in the yen versus the dollar has given a boost to Japanese exports."

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Remember the near-shutdown of West Coast ports during the winter, caused by a labor conflict? The issue is over, right?
West Coast, port, labor, shutdown
Thursday, 02 April 2015 07:20 AM
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