By Jack Humphreville, September 27, 2013
LA WATCHDOG-The Port of Los Angeles
is in desperate need of new management, starting with the five Harbor
Commissioners, the Executive Director, and other members of the
politicized senior management team.
For the first eight months of 2013, imports of fully loaded
containers are off by 6% while exports are down 11%. This downward
trend will mostly likely continue as ports in Canada and Mexico expand
and improve their operations and efficiency.
This trend will only be exacerbated when Panama completes the
widening of the Canal in 2014, allowing Asian manufacturers direct
access to the large population centers serviced by ports on the Gulf
Coast and Atlantic Ocean.
The Port is also considered an unreliable partner. In the past, our
high cost and inefficient port has been shut down because of work
stoppages that caused major problems for retailers during their peak
Christmas shopping season, resulting in billions of lost sales.
The Port has a business unfriendly reputation in the shipping
industry, ranging from retailers to shipping companies to the trucking
industry. For example, Wal-Mart, the nation’s largest importer by far
that has been blackballed by the City of Los Angeles, has diverted most
of its traffic to other ports around the country. Maersk Lines, the
world’s largest shipping company, has invested up to $300 million to
expand its operations in Mexico as a result of its frustration with our
Port, its management, and their policies. And the trucking industry is
still smarting over its protracted legal battle with the Port over the
“company employee” provision of the Clean Truck Program.
The Port has also been a dumping ground for politically connected
City employees. Over the past decade, the number of employees at the
Port has increased by about two-thirds while volumes of loaded imports
have essentially remained flat. Furthermore, the number of political
appointees in the executive ranks has tripled, costing millions, while
at the same time, replacing hard working employees who had an excellent
understanding of the Port’s operations and good working relationships
with the Port’s major tenants.
There are numerous brush fires at the Port which, when taken as a whole, indicate a failure of management.
We have recently heard about the multimillion dollar cost over run on
the Angelena II, the Port’s 72 foot yacht that is used for public
relations. There are the plush executive offices that cost millions.
There is extensive last minute travel and the very expensive hosting of
the conference for the International Association of Ports and Harbors in
Downtown LA. There are numerous below market leases and over the top
community benefits to please the political establishment. And do not
forget the failed investments in Balgon and Vision Industries.
The Port is too important to the economy of Southern California and
the City of Los Angeles to be left in the hands of political hacks and
If Mayor Eric Garcetti is serious about reforming how government
works in LA, the place to start is with the Port of Los Angeles. We
need five independent Harbor Commissioners that have the expertise and
experience to understand this very competitive industry that is both
capital and labor intensive, to help mend the relationships with
shipping community, and to provide guidance to the new Executive
We also need a new Gener
al Manager for the country’s largest port
that has the respect of the nation’s retailers and the shipping
community, is willing to tackle the problems facing the Port in this era
of significant change, and has the wherewithal to implement change,
even if it annoys City Hall and its cronies.
Eric, the ball is in your court.