Why You Can't Take a Cruise From Brooklyn to Baltimore, or L.A. to San Francisco


Free Pete Welch!

Noted cruiser Steve Smith, that favorite target of Hit & Run commenters, gets his closet libertarian on with this rant against the little-known Passenger Vessel Services Act of 1886 (PVSA), which effectively bars cruise ships from sailing between American cities. Excerpt:

[The PVSA] force[s] cruiseships going from one US city to another to either stop at what is called a "far foreign port" (ie., outside of North America), or to stop at a foreign port within North America before returning to the American port of embarkation. Thus, a cruise ship cannot start in Los Angeles and end in San Francisco unless it stops in Tokyo or Lima first. But it can start in Los Angeles, go to San Francisco, then later end in Los Angeles, as long as it stops in Ensenada, Mexico or Victoria, British Columbia first.

And effectively, almost all cruise ships are considered "foreign vessels" for purposes of this act, regardless of whether the line is a domestic corporation, since almost all cruise ships are built overseas. […]

Free Matt Ridley and Ron Bailey!

[T]he consumer is shortchanged, since we: a) have to spend more money to take an unnecessarily longer cruise, and b) have fewer consumer choices as to which ship to take, since the domestic market is already saturated with ships taking the same routes to the same locales. Moreover, dockworkers and others who benefit from having busy and profitable ports are screwed by the PVSA, since few cities are close enough to foreign ports to make cruising out of those cities a worthwhile proposition.

And who likes this law? Cruise lines, of course. If the law were to be repealed, the increase in the number of short, affordable cruises within the United States would be exponential. One of the most popular cruises at present is the weekend "booze cruise" that leaves a US port, sails to a nearby foreign locale, like the Bahamas or Ensenada, and back. The typical passenger on such a cruise is much less affluent than the seagoing traveler who typically sails on the larger ships; given the option of taking a weekend cruise from LA to San Francisco and back, or from Baltimore to Brooklyn, or to and from cities on the Great Lakes, more people would sail than ever before. But that would also entice other ships into the market, so the market share of the half-dozen or so companies that control the US market would plummet.

In effect, the PVSA provides for the cruise industry what the pre-1980 regulation of the passenger airlines did for flying; it has created a non-responsive, expensive business oligopoly that caters to the well-off, and prevented the creation of innovative, cheaper competitors. And it does all this while providing nothing of benefit to the consumer, to industry, or to the worker.

Read the whole thing here. Read about the deregulation of airlines in The Declaration of Independents: How Libertarian Politics Can Fix What's Wrong with America. And stay tuned for news about Reason's second annual cruise, coming to an Alaska near year you in the summer of 2012!

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  1. Steve Smith is clearly just looking for some sort of rape-cruise market to emerge.



        1. FUNNY EVERY TIME!1!

          1. Movie idea: The Reason Cruise enters the Bermuda Triangle, and a strange series of rapes begins…


  2. All I want is to cruize out to international waters, and then break out the blow and hookers.

  3. And effectively, almost all cruise ships are considered “foreign vessels” for purposes of this act, regardless of whether the line is a domestic corporation, since almost all cruise ships are built overseas.

    It’s where they are flagged, not built.

    The modern practice of flagging ships in foreign countries began in the 1920s in the United States, when shipowners frustrated by increased regulations and rising labor costs began to register their ships to Panama.

    1. No, SIV, he’s right. Take a look at this page:

      Per it, the vast majority of new cruise ships, (Carnival, Royal Norwegian, Cunard, etc…) are built in Europe. (Finland, Italy and Germany, it looks like.)

      Which is strange, I had thought the Koreans and Japanese had the market for this sort of thing. But they definitely aren’t being built here.

      1. Right. But the issue is not where the ship is built, but where it is flagged. You can build a ship in Germany and flag it in any country you want.

        1. Mo and SIV are correct. Any ship may be flagged as a United States vessel, regardless of it’s build country. The reason most cruise liners are registered in other countries is a matter of taxes and legal restrictions.

          If a ship is registered in the US, it’s owners must follow all US labor laws (OSHA, Min. Wage, etc). Additionally, any lawsuits regarding damages on board a vessel must be registered and heard in the country of registration where the court systems may be more favorable to the cruise lines.

          Contrary to Schu’s statement, a ship of foreign registry may make consecutive US ports of call provided that it makes one foreign stop in a slated itinerary. Hence the stop in Vancouver, BC on an Alaska cruise with 7 ports of call.

          What it all boils down to is protectionism, just like the Chicken Tax.

      2. It’s the flag of the vessel that is the issue, not the country where it was built. The Cabotage Laws are protectionism for America’s shipping industry. Any foreign flagged vessel may not stop in two consecutive American ports. It doesn’t matter if it’s a cruise ship or a container ship. All American port to port traffic is reserved for American flagged (this means American crews as well) vessels.

        1. How much of a shipping industry does America have now? Barges?
          It’s almost like protectionism didn’t work?

          1. Next to none. Aside from supply vessels working in the oil fields of the Gulf, what we have is pretty much limited to ITB’s (Integrated Tug and Barges). The big stuff is all foreign flagged.

            The only reason we even have the ITB’s and the OSV work is because of that protectionism. I don’t normally agree with protectionism, but in this case it’s equivalent to not wanting foreign truck drivers hauling goods all over the country.

            1. But, as Kwix mentioned, this has more to do with the regulations that American flagged vessels are forced to deal with than anything else. It is just too damn easy to register in a third world country that doesn’t give a damn what you do on board, as long as you pay their fee. These ships are still beholden to International Law, they just don’t have to deal with the bullshit of the American legal system.

    2. For those who are interested, these are the “flags” of the various major cruise ships now at sea:…..gistry.htm

  4. Thus, a cruise ship cannot start in Los Angeles and end in San Francisco

    This problem will be handily resolved with hundreds of Federales Gigabucks for High Speed Cruise Ships.

  5. Freeing up this market would create some potential markets. A 2 or 3 day cruise from Boston or New York to Florida could compete against car, rail, and airlines for vacationers and retirees.

    My parents spend the winters in Florida – sometimes driving all the way, sometimes taking the auto-train from DC part of the way. They would consider cruising there if it was cost-competitive.

    1. I’m sure Disney could make a killing running a regular cruise ship on a Boston, NYC, Baltimore, NC, Port Canaveral and back run–or any other cruise line could do it as well.

      1. Yep – Same deal on either coast. A Tampa to New Orleans / Houston run might make money too.

  6. Why You Can’t Take a Cruise From Brooklyn to Baltimore, or L.A. to San Francisco

    I can understand wanting to leave those places, but why would you even want to go to those other places?

    1. (Those places have large ports for cruise ships to stop at)

    2. To gawk at the natives, of course.

  7. And it does all this while providing nothing of benefit to the consumer, to industry, or to the worker.

    And you were doing so well.

  8. I’m a bit confused here — I know for a fact I’ve taken boats from one American city to another (Milwaukee to Muskegon and other trips). Is there some technical definition of “cruise ship” that is at play here which excludes, for instance, ferries?

    1. Oops, it was Ludington, MI, not Muskegon.

    2. Your trips sound so glamorous.

      1. Well Ludington wasn’t my destination, I was going to Traverse City. It made more sense this way coming from Rockford rather than going through the NW Indiana bottleneck.

        1. OK, Traverse City is totally glamorous. But I like the NW Indiana bottleneck.

    3. The PVSA only applies to foriegn vessels. If they are flagged in the U.S., then they can go directly from one U.S. port to another.

      1. The same reason that “foreign” airlines are prohibiting from flying between US airports.

      2. Of course that just leads to the question of why these putative intercity cruise lines don’t just flag their ships as American.

        1. Taxes, most likely.

        2. Regulations under the Jones Act make it prohibitively expensive for a large ship. Only a ship owned by a US citizen or corporation can be flagged in the US, and that ship must be built in the US, which costs a lot more due to excessive regulation. Also, a US flagged ship must be crewed entirely by US citizens. That’s not a big deal on a small ferry where there is a captain, first mate, 5 or 6 deckhands, and maybe an engineer; but large cruise ships typically have over 1,000 crewmembers.

          1. That’s about as bad as it can possibly get.

          2. And in the states mentioned, the crews would be in the union too.

    4. please stay off my lake. Thank you.

      1. I’ll never understand the attachment to a giant toilet bowl that never gets flushed. The Monongahela may be a toilet trench too, but at least it gets flushed every spring.

        1. Do you like it when other people share your toilet?

          1. I wouldn’t mind, but they don’t risk it for some reason.

            1. If it’s yellow,
              Let it mellow.
              If it’s brown,
              Monkey Town!

              1. With gems like this it’s a wonder the right hasn’t made more headway with the black comunity.

    5. I doubt any American ferry is flying the Liberian flag.

  9. “And who likes this law? Cruise lines, of course”

    Why would a cruiseline like the idea of not being able to provide services to a potential costumer-base?

    You don’t think that Royal, Carnival, or some other company wouldn’t capitalize on this?

    1. Erecting legal barriers to entry in order to keep competition out does not mean an existing company couldn’t or wouldn’t like to tap into a market segment that is effectively made off limits by this law.

      I’m not in favor of higher barriers, mind you, I just don’t imagine every established cruise line enjoys the idea of being disallowed from expanding their business.

      1. The barriers to entry are significantly lower for domestic port to port cruising. By forcing companies to dock in at least one foreign port prior to returning to a domestic US port, you prevent a lot of other potential providers out of the market.

        1. I know… I’m just questioning the “cruiselines love it” line of logic.

          1. Because cruise lines would rather be limited in their destinations than face increased competition?

            See also: Phillip Morris supporting almost all tobacco regulations; Liquor stores supporting regulations barring sales after a certain time at night, etc etc etc…

            1. Yes, that’s his assertion. Most businesses would favor a licensing restriction to keep new competitors out, but I don’t imagine they’re fond of not being allowed to expand in different markets.
              I can see liquor stores favoring restrictive licensing but not archaic blue laws.

  10. So with the additions of brackets I am starting to the HERCULE is STEVE SMITH’s alter ego.

  11. Today, foreign airlines are prohibited from scheduling flights between US cities to protect the domestic airlines.

    And, foreign cruise ships are prohibited from scheduling cruises between US cities to protect domestric cruise lines (which don’t actually exist because US regulations are so onerous that there are no US flagged cruise ships).

    Makes perfect sense to me.

    1. So the problem at the heart of this is the regulation of US-flagged cruise ships, rather than the restrictions on the itinerary of foreign-flagged ones.

      1. Actually both are problems. The US airline business will never straighten itself out until it has to compete with better-equiped, better-run “foreign” carriers on internal US routes.

        But the worst possible case would be flying to Canada to make a connection between the east coast and the west cost, because regulations drove all the US carriers out of business.

  12. We need high speed cruise ships.

    1. Exactly. They’ll carry our high speed trains across large bodies of water.

  13. This thread is a lot less rape-y than I thought it would be.

    1. Rape, exciting and new
      come aboard, we’re violating yoooooou

  14. Any cruise ship going to Baltimore deserves to be regulated out of existence.

    1. I would expect that the high incidence of gangplank-end rapes at the destination would self-limit the market for tickets to an exclusive clientele.

    2. This^^^

      I can’t think of a cruise any worse than Brooklyn to Baltimore.

      1. Buffalo to Detroit?

        1. If you could shoot at the natives and the wildlife in Detroit, like they used to do from trains in the Wild West, well, I could be tempted.

          1. Well, you can shoot all the infrastructure. I’ve been there and it’s shot to hell.

      2. Brooklyn and Baltimore are the ports that serve New York City and D.C./Virginia; just as a cruise that went from Livorno to Civitavecchia wouldn’t merely transport tourists between those two ports, but rather to those who wanted to visit Florence and Rome.

  15. Came to comments for the raping, was not completely satisfied.

  16. I wonder if the Seasteading Institute and the Free State Project will team up to run cruises from Portsmouth, NH to Seabrook, NH.

  17. To carry passengers directly from one US port to another requires the ship to be both built and flagged in the US, and crewed by Americans. Currently there is one ship like this doing laps around the Hawaiian islands.

  18. I’ll bet Disney would love to route a cruise ship up and down the US East Coast, taking passengers to Port Canaveral and back. I believe the ships would pass all US inspections.
    The Disney ships were built in Italy, so some politicians would have to be bribed to provide a waiver.
    But the costs of crewing the ships with Americans only would price Disney out of the cruise market.

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