Posted on: Sunday, January 13, 2002
EDITORIAL
Open Island waters to foreign ships
Senior Hawai'i Sen. Dan Inouye has long been an ardent defender and supporter of America's domestic shipping industry.
So there's little surprise in his continued strong defense of the Jones Act (which protects domestic cargo shippers) and the related 1886 Passenger Vessel Services Act covering passenger liners.
But with the demise of American Classic Voyages, which operated interisland cruise ships in Hawai'i, Inouye has opened the door a crack for foreign operators in local waters. But the opening is so small that it is unlikely anything will come of it.
Inouye moved legislative heaven and earth to keep American Classic up and running. The popular cruise operator received an unusual "monopoly" in local waters, a special exemption that allowed it to use a foreign-built ship until U.S.-built ships were ready, and other favors.
None of it was enough, and shortly after Sept. 11, American Classic declared Chapter 11 bankruptcy.
In effect, that was the end of the domestic passenger cruise industry, with the exception of American Classic's famed Delta Queen, which still operates Mississippi River cruises.
There is plenty of interest remaining in interisland cruises, but it comes from the foreign-owned companies that have established a strong presence in the Caribbean and in the Alaska cruise business.
The Norwegian Star is already home-ported here and will be joined by a sister ship at least half the year beginning next year. These foreign-owned cruise ships were able to get around the 1886 law because each voyage includes a "foreign" stop at tiny Fanning Island south of here. So they are technically not voyaging from U.S. port to U.S. port.
Clearly, the cruise line would prefer not to take that lengthy detour simply to get around the archaic American shipping law.
Inouye said last week he would consider supporting an exemption to the Passenger Services Act to allow foreign-registered ships to operate domestically, but only under strict conditions.
Those conditions include using American labor, following American laws, paying federal taxes and operating without any form of gambling.
In effect, he wants the foreign cruise operators to fall under the same rules and restrictions that applied to American Classic. That would make sense if American Classic were still operating, but it isn't.
The raw facts are that there is no domestic passenger cruise industry today. The popular cruise ships operating out of Florida and to Alaska are all foreign-owned. Port calls at nearby Caribbean islands, in Mexico and in Vancouver, Canada, take care of the problem.
If a domestic passenger cruise industry existed, it might be possible to make the argument that it deserves protection. But that's not the case today.
Inouye's conditions amount to a deal-breaker. Hawai'i could benefit from increased competition and alternatives for interisland cruising and even, potentially, for cruises that operated between the Islands and the West Coast. Imagine reinventing the days of the Lurline, with today's fast, stable and luxurious cruise ships.
The senior senator is on target, however, with his insistence that there be a ban on gambling on interisland cruises, whether they are foreign or domestic. It is clear that even limited shipboard gambling would be a foot in the door for other forms of gambling, both on shore and off.
Hawai'i has a right to make its own decision about gambling and thus far has been clear in its opposition. If gambling ever comes to this state, it must be through the front door and with eyes wide open.
