A few weeks back I noticed some articles related to Governor Scott’s trip to Panama to ostensibly encourage trade through the port of Miami. With the expansion of the Panama Canal and the resultant larger ships passing through it from half way around the globe, it is expected that a port or two on the East Coast will benefit. Here is a link to one article discussing that:
http://www.evri.com/...
It appears that Florida East Coast Railway (FEC) has had this possibly in their strategic plans for some time. I do not know whether many other major companies will benefit, but FEC sure appears happy about Scott’s decision. According to an article in the Jacksonville Business Journal FEC has a plan to open an intermodal rail facility in Fort Lauderdale in 2013. The Republican dominated Florida legislature appears ready to provide Governor Tricky Rick with a $400 million slush fund to use in anyway he wishes. Also by the way, the Republican controlled legislature is also setting up slush funds to aid themselves in reelection campaigns. A ‘Slushy Cup’ from a convenience store is the appropriate symbol for the Tea-Party; the founding fathers of the American Revolution must be turning over in their graves because of the pretentious Tea-Party clowns. The word clown is the correct word given the performances at the Tea-Party rallies. The Governor had already promised $77 million to dredge the Miami port back in 2010. Whether the legislature ultimately provides Scott with a slush fund or provides the dredge funds themselves, it is clear that they would be acting at Scott’s urging.
http://blogs.orlandosentinel.com/...
It is indicated by FEC that customers who send goods north can receive a 40% to 50% discount from FEC compared to those being shipping goods southward. I am left with impression that is because much of the units going north are empty and filling up that unused capacity would be highly profitable. This reminds me that one of the wealthiest people in the world is the Chinese lady whose company returns cardboard and such back to China in deadhead freighters; the point being that there is apparently already excess capacity to send cargo north back before any expansion in the greater Miami area. Further, I wonder how empty containers would get back to the Far East countries and what port they will depart from; that must be in the strategic plan someplace. I see that FEC was acquired a few years back by Fortress Investment Group in 2007. The economic events of 2008 apparently hit Fortress hard since there are several published articles about the company that you can check for yourselves. The article by Bethany Mclean in Vanity Fair in 2009 may be worth the time. You may remember Mclean wrote about Enron. Mr. Edens one of the founders of Fortress probably made his reputation in the aftermath of the Resolution Trust activities in the 1990s. Curious how some entities do so well in the wake of financial disasters.
http://www.vanityfair.com/...
In the previous year 2006, Fortress acquired another railroad company, Rail America which consists of number of short line and regional railroads. Rail America has acquired several additional rail lines within the last month; not a significant purchase as far I can tell. The Japanese conglomerate/investment company Nomura acquired a significant piece of Fortress earlier in 2006; one article I read indicates that Nomura now owns around 30% of Fortress. It is touching that Governor Scott would have such empathy for other stock market wheeler - dealers. He certainly does not have much for average Floridians, despite recent photo-ops. By the way, Fortress has also made news for its lack of feelings for puppy dogs and other animals with its financial support of HLS in the past.
http://www.indymedia.org.uk/...
http://negotiationisover.com/...
Rail American is a separate company with a listing on the stock market and the price has increased a significant percentage in recent months. Not sure why or how it is separate company when other companies owned by Fortress are not. Railway may the “pure play” way to invest in the Fortress railway business activities? There are also a container leasing company and an air transportation company within the Fortress Transportation Group of companies along with FEC and Rail America.
http://jacksonville.com/...
The jobs that Scott projects from the Miami port work are questioned by the same libertarian whose work Scott relied in making the decision to reject the Tampa to Orlando high speed train funds.
http://articles.orlandosentinel.com/...
There must be environmental as well and economic issues to consider. Would the Miami port be more damaged than other ports under consideration? At least two ports, Norfolk and New York, do not need to be dredged. Another port, Jacksonville, is already actively seeking federal funds for port improvements to handle cargo from a Korean and Japanese shipping companies as well as for a naval nuclear carrier. A port north of Miami would reduce much of the additional on-land transportation of goods. Generally, sea transport is preferred to land transport of goods. There are many other ports such as Brunswick, Savannah, Charleston, and Norfolk on the Atlantic Coast. Tampa and Mobile among others are possibilities on the Gulf Coast. Far Eastern shippers might choose to unload cargo on the western Mexican coast rather than going through the Panama Canal. Miami is not a sure thing even if the port is dredged. Then again maybe the fix is in. FEC counters that the goods would get to Nashville or Atlanta destinations as quickly as from other ports.
At a time when the Scott wants to cut corporate tax rates, property tax rates and government spending one has to wonder why is he wants to use 77 million dollars for dredging? Florida is already ranked 50th in public education funding. Who should get credit for that? Brother Jeb? His favorite Senator Rob-u-o, that is the way I pronounce the name? We are number 50! That should have been is their campaign slogan. Scott wants to cut education spending to 1976 levels in case any other states were planning to steal that dubious honor. Ranked 50th (last) with a descending bullet , that is one way to create more charter schools for Scott’s business pals to take over. I do not hear screams of looming financial exigency from the colleges and universities, maybe they are going to get some charter school or management contracts?
Governor Scott has stated in Florida Trend Magazine that government does a poor job of selecting winners but here he is trying to select a winner. Where are the Tea-Party and libertarian folks on this? The $77 million sounds like a state’s equivalent of an earmark. If the Tea-Party and libertarians are consistent they should be complaining about the $77 million. If a Democratic Governor was doing this they would be screaming about a liberal politician wasting money. If the primary beneficiary of the Miami port dredging is private company, should not the company pay for all the dredging costs by way of taxes or fees? The Tea-Party and libertarians folks seem to be ok with the use of slush funds for projects and political activities they support. They really are not concerned with excess governmental spending just with getting their own way.
Temper tantrum alert if the Tea-Party folks and other Republicans do not get their way. Here is a link to how a South Carolina Senator had a fit when an Army Corp. of Engineers study amount related to Charleston port deepening was not included in Federal Budget provisions. Maybe the Senator had reason to be angry? Still, this is another Republican who talks about cutting spending but not those for his own state. Not much has changed in politics since Ronald Reagan’s Grace Commission back in the 1980s. Perhaps, the Senator Graham’s anger is misdirected; some South Carolina commentators have started to notice. Maybe he should be angry at other Republicans --assuming his anger is real.
http://www.huffingtonpost.com/...
Back to Florida, there are likely to be huge budget cuts to the Florida budget and many will be affected. Why spend millions on the port when the amount of job creation is unknown. Scott has an unwillingness to lay the numbers out there; we just are supposed to just to accept his opinion. I suspect that much of the projected increased traffic would go through the planned intermodal facility thus FEC and other benefiting entities should contribute the $77 million; corporate welfare does not seem justified. If Scott is really concerned about ‘Jobs’ more ‘Jobs’ would be created by trucking goods up from southern tip of Florida. The evidence, so far, suggests that creating ‘Jobs’ is not his main priority no matter want he may say.