Calming our tourism waters
By Sen. Daniel K. Inouye
Recent developments in Hawai'i's tourism industry have sent a resounding distress signal. On March 31, Aloha Airlines was forced to cease passenger operations after nearly 61 years of faithfully serving Hawai'i. Two days later, ATA Airlines also shut its doors, leaving visitors and local residents stranded in Hawai'i or the West Coast.
We should not allow a similar tragedy to occur at sea.
Last year, NCL America pulled one of its cruise ships from interisland service, with another scheduled to leave next month due to devastating economic losses caused by unfair foreign competition. With the departure of these two U.S.-flag ships, local jobs and hundreds of millions of dollars in economic activity also leave Hawai'i. Only one ship will remain. It will be the only remaining large U.S. cruise ship to ply our waters. Most fittingly, it is named the Pride of America.
Now, it is also being threatened by unfair foreign competition. U.S.-flag ships must satisfy stricter environmental, employment, safety and security standards than their foreign competitors. U.S.-flag ships hire primarily American citizens, and are subject to U.S. and Hawai'i healthcare, pension and other laws, and pay federal and state taxes. Foreign-flag carriers do not; they do not pay Hawai'i taxes nor do they pay their workers a living wage. Even President Bush declared his support for a strong U.S. maritime industry in his 2006 Labor Day address to an audience of U.S.-flag cruise ship trainees.
The total estimated expenditures on goods and services supplied by Hawai'i businesses for the Pride of America is $43 million annually, compared to $13.2 million from the entire foreign-flag fleet. That's more than a 3-to-1 ratio. Just imagine the economic figures when all three NCL ships were operating. These are not abstract numbers. These are real dollars and real jobs for real people on all the major islands.
On O'ahu, Aloun Farms supplies corn, squash and green onions. Nakatani Farms provides the watercress, Meadow Gold supplies ice cream, and Love's Bakery, the fresh bread. On the Big Island, Diamond Head provides the papayas, Green Point the ti leaves, and Kona Cold Lobsters provides its special delicacy. From Maui comes fresh strawberries, pineapples and its famous onions. On Kaua'i, produce is bought from Koa Trading and Esaki's, together with beverages and spirits from Paradise Beverage. Moloka'i provisions include cucumbers and Kumu Farms' pesto. This is just a small sampling. The foreign cruise lines, on the other hand, do not provision with much of any local produce — they bring their provisions with them.
Several years ago, I sought to revitalize our dormant U.S.-flag cruise industry in Hawai'i to create jobs at home, as well as to enhance U.S. military sealift capabilities. Enacted with bipartisan support, the legislation was praised for the nearly $1 billion in economic activity, and more than 20,000 jobs it produced nationwide. The most significant benefits of the legislation, however, are in Hawai'i.
On Nov. 21, 2007, U.S. Customs and Border Protection proposed a rule to better enforce the Passenger Vessel Services Act, and, in doing so, provide a level playing field for our U.S.-flag ships. However, the original draft of the rule, while well-intended, caused much consternation due to its broad application, given the current state of the U.S.-flag cruise industry.
Several months before this proposed rule was announced, we lost our first U.S. cruise liner. Not long thereafter, NCL America announced the departure of the second U.S. cruise ship. The entire state of our U.S. large cruise industry resides in the Pride of America with its 1,340-member crew.
The CPB received and reviewed many comments. From what I understand through recent media reports, a narrower rule is under active consideration. It will apply only to Hawai'i waters and will require that one-third of the time a foreign-flag ship spends in port on a Hawai'i itinerary be spent in a foreign port. Should we lose our last U.S.-flag ship, it would indeed be a sad day for us all.
A modest rule tailored to provide a level playing field in Hawai'i waters makes good sense. We need to step forward to protect what we have left, before it, too, is gone, and we are looking around, saying to each other, "What happened?" "What could we have done to prevent this?" We have an opportunity to learn from the devastating tragedy of Aloha Airlines, and not stand by and watch another tragedy occur — this time at sea.
During these difficult times, we must promote those policies that ensure the long-term health of our tourism industry. We cannot allow another key facet of this sector to die due to forces beyond its control. As a community, I urge our local and state elected leaders to support fair seas and calm sailing for our Pride of America.
Sen. Daniel K. Inouye is Hawai'i’s senior U.S. senator. He wrote this commentary for The Advertiser.