Why the ship lines are winning this West Coast fight

One reason dockworkers are well paid
One reason dockworkers are well paid   

The maritime bosses on the West Coast are winning their fight with the dockworkers.

Ship lines and terminal operators there are effectively imposing lockouts, while avoiding having them formally…or more importantly legally…called "lockouts."


Instead the current port shutdowns are being described as operationally necessary because of congestion problems; cargo can't move through the port, the argument goes, because there is no place to put it. So the port must close, at least long enough to clear out some space.

Why the congestion problems? Employers point at the International Longshore and Warehouse Union, saying its members are dragging their feet and slowing down work because they don't have a contract. But the dockworkers' union points right back at the employers, saying they are purposely mismanaging traffic and equipment to cause congestion and put the union in a bad light.

Either way or in-between, it's working to the employers' advantage. They are closing down ports on weekends and holidays. That robs the workers of pay and makes them put pressure on their leadership to cut a deal…in effect the same thing a lockout does.

But if the employers actually conducted a lockout, it would open the door for the government to step in.

Because of labor laws, the government, however sympathetic, can't jump in unless the President believes "that a threatened or actual strike or lockout that affects an entire industry or a substantial part of it will endanger national health or safety."

Department stores not getting this spring's swimsuits on the shelves fast enough probably doesn't rise to that level. Yet. Nevertheless, retailers are complaining loud and hard to the White House, Congress and anyone else who will listen.

And the ship lines and port operators don't have to worry much about that either.

Angry customers...with no choices

The port employers, you see, are for the most part either controlled by or beholden to foreign ship lines. The U.S. doesn't have much in the way of international shipping. What maritime companies we do have, like Matson Navigation, work domestic trades (think California-Hawaii) which are reserved to U.S. carriers only. And most terminal operators are either owned outright by one of those foreign carriers or have one of those foreign carriers as their main client.

That's okay. Retailers can just take their business elsewhere and avoid the West Coast entirely, right? Sure.

But odds are you're going to have to deal with the same bunch of carriers if you're going to get your goods to and from Asia, whether it's the East Coast or West Coast. That's because ship lines cruising between Asia and the West Coast are pretty much the same ones cruising between Asia and the East Coast.

None of this is to say whether the employers group (the Pacific Maritime Association), or the union for that matter, are right or wrong in their desires. Employers want lower costs and efficient operations. The union wants more money and job security.

But so far in this fight, the wind is favoring the ship lines.