An Overview of Port Security An Overview of Port Security Programs Programs Jon D. Haveman, Howard J. Shatz, and Jon D. Haveman, Howard J. Shatz, and Ernesto Vilchis Ernesto Vilchis Public Policy Institute of California and Public Policy Institute of California and Princeton University Princeton University Conference on Economic Costs and Consequences of a Terrorist Attack Conference on Economic Costs and Consequences of a Terrorist Attack University of Southern California Center for Risk and Economic Analysis University of Southern California Center for Risk and Economic Analysis of Terrorist Events of Terrorist Events Los Angeles, California, August 20-21, 2004 Los Angeles, California, August 20-21, 2004 This presentation reflects the views of the authors and does not necessarily reflect the views of the staff, This presentation reflects the views of the authors and does not necessarily reflect the views of the staff, officers, or board of directors of the Public Policy Institute of California officers, or board of directors of the Public Policy Institute of California
Transcript
An Overview of Port Security An Overview of Port Security ProgramsPrograms
Jon D. Haveman, Howard J. Shatz, andJon D. Haveman, Howard J. Shatz, andErnesto VilchisErnesto Vilchis
Public Policy Institute of California andPublic Policy Institute of California andPrinceton UniversityPrinceton University
Conference on Economic Costs and Consequences of a Terrorist AttackConference on Economic Costs and Consequences of a Terrorist AttackUniversity of Southern California Center for Risk and Economic Analysis of Terrorist EventsUniversity of Southern California Center for Risk and Economic Analysis of Terrorist Events
Los Angeles, California, August 20-21, 2004Los Angeles, California, August 20-21, 2004
This presentation reflects the views of the authors and does not necessarily reflect the views of the staff, This presentation reflects the views of the authors and does not necessarily reflect the views of the staff, officers, or board of directors of the Public Policy Institute of Californiaofficers, or board of directors of the Public Policy Institute of California
Ports Can Serve As Targets or as Vectors Ports Can Serve As Targets or as Vectors for Terrorist Activityfor Terrorist Activity
An attack at a major port could disrupt the An attack at a major port could disrupt the U.S. economyU.S. economy
It could also kill thousands of peopleIt could also kill thousands of people
Terrorists could ship material anywhere in Terrorists could ship material anywhere in the United States in an uninspected containerthe United States in an uninspected container– 30 days to report to Customs30 days to report to Customs
Responses in Five Different CategoriesResponses in Five Different Categories
Planning for protection, response, and Planning for protection, response, and recoveryrecovery
Hardening ports as a targetHardening ports as a target
Sealing gaps in the supply chainSealing gaps in the supply chain
Pushing U.S. borders outPushing U.S. borders out
Developing and adapting technologyDeveloping and adapting technology
OutlineOutline
The Issue of Port SecurityThe Issue of Port Security
Post 9/11 Port Security MeasuresPost 9/11 Port Security Measures
EvaluationEvaluation
Seaports are Essential to the U.S. Seaports are Essential to the U.S. EconomyEconomy
361 seaports move about 80 percent of U.S. 361 seaports move about 80 percent of U.S. trade by weighttrade by weight
$742 billion in 2002 – more than goods trade $742 billion in 2002 – more than goods trade by all modes in most countriesby all modes in most countries
Global supply chains and just-in-time Global supply chains and just-in-time relationships imply strong ripple effectsrelationships imply strong ripple effects
Security is a Challenge for Many ReasonsSecurity is a Challenge for Many Reasons
Volume of trade and time sensitivityVolume of trade and time sensitivity
IntermodalityIntermodality
Jurisdictional issuesJurisdictional issues
Quantity of stakeholders, public and privateQuantity of stakeholders, public and private
Global industryGlobal industry
Average container journey has 16 stopsAverage container journey has 16 stops– ““Goods at rest are goods at risk”Goods at rest are goods at risk”
Before September 11, 2001, Port Security Before September 11, 2001, Port Security Focused Mostly on CrimeFocused Mostly on Crime
For example, Interagency Commission on For example, Interagency Commission on Crime and Security in U.S. Seaports, 2000Crime and Security in U.S. Seaports, 2000
But terrorism was a recognized threatBut terrorism was a recognized threat
Proposals advanced in the late 1990s laid the Proposals advanced in the late 1990s laid the groundwork for the post-9/11 responsegroundwork for the post-9/11 response
OutlineOutline
The Issue of Port SecurityThe Issue of Port Security
Post 9/11 Port Security MeasuresPost 9/11 Port Security Measures
EvaluationEvaluation
Maritime Transportation and Security Act Maritime Transportation and Security Act of 2002 Provided Overall Strategyof 2002 Provided Overall Strategy
National, area, facility, and vessel security National, area, facility, and vessel security plansplans
Vessel and facility response plansVessel and facility response plans
Maritime safety and security teamsMaritime safety and security teams
Automatic identification systemsAutomatic identification systems
Assessment of foreign portsAssessment of foreign ports
USCG lead agencyUSCG lead agency
MTSA Implementation is Expected to MTSA Implementation is Expected to Prove CostlyProve Costly
Vessel Security
Facility Security Other Total
1st year cost 0.2 1.1 0.2 1.5
1st year benefit 781.3 473.7 149.9 1,404.9
10-year cost 1.4 5.4 0.5 7.3
10-year benefit 5,871.5 3,559.7 1,126.6 10,557.8
$ Billions
Each MTSA Measure Proceeding on Its Each MTSA Measure Proceeding on Its Own ScheduleOwn Schedule
Security plans in place by July 1, 2004Security plans in place by July 1, 2004– 49 questionable vessels in first week49 questionable vessels in first week
TWICs in third phase of developmentTWICs in third phase of development– Ports in northeast, LA and LB, FloridaPorts in northeast, LA and LB, Florida
MTSA broadened in August 2004MTSA broadened in August 2004
California’s requirements include terminal California’s requirements include terminal traffic controls, surveillance equipment, traffic controls, surveillance equipment, utility upgradesutility upgrades– Expected cost > $305 millionExpected cost > $305 million
CSI: Pushing the Border OutCSI: Pushing the Border Out
Places CBP teams at foreign portsPlaces CBP teams at foreign ports
Screens risky containers at point of Screens risky containers at point of departuredeparture
First stage had 23 ports in 19 countriesFirst stage had 23 ports in 19 countries– 68% of U.S. container traffic68% of U.S. container traffic
Second phase adds 15 portsSecond phase adds 15 ports– 80% of U.S. container traffic80% of U.S. container traffic
C-TPAT: Sealing the Supply ChainC-TPAT: Sealing the Supply Chain
Voluntary participation by private sectorVoluntary participation by private sector
Self-assessment of supply chain securitySelf-assessment of supply chain security
Implement a program to improve supply Implement a program to improve supply chain securitychain security
Benefit: easier clearance into U.S.Benefit: easier clearance into U.S.
Federal Government Has Instituted Federal Government Has Instituted Different Grant Programs for Port SecurityDifferent Grant Programs for Port Security
$645 million so far$645 million so far
Four rounds of TSA grants -- first three Four rounds of TSA grants -- first three rounds completedrounds completed
Operation Safe Commerce for specific supply Operation Safe Commerce for specific supply chain issues at major portschain issues at major ports
UASI grants of $75 millionUASI grants of $75 million
R&D grants for specific technologies -- $15 R&D grants for specific technologies -- $15 million annually, raised to $35 millionmillion annually, raised to $35 million
OutlineOutline
The Issue of Port SecurityThe Issue of Port Security
Post 9/11 Port Security MeasuresPost 9/11 Port Security Measures
EvaluationEvaluation
Compliance and Efficacy Constitute First Compliance and Efficacy Constitute First Major GapMajor Gap
MTSA required more than 12,000 facility and MTSA required more than 12,000 facility and vessel security plans. How to oversee?vessel security plans. How to oversee?
C-TPAT includes self-assessments and C-TPAT includes self-assessments and private-sector action regarding improvement. private-sector action regarding improvement. How to verify?How to verify?
CSI places CBP officials at foreign ports. CSI places CBP officials at foreign ports. How many are enough?How many are enough?
Funding Is a Second Major GapFunding Is a Second Major Gap
USCG has new mandates but is stretched USCG has new mandates but is stretched thinthin
Private sector is expected to pay for security Private sector is expected to pay for security upgrades. It may not be able or willingupgrades. It may not be able or willing
Public financing alternatives yet to be Public financing alternatives yet to be selectedselected– General fund, customs duties, user feesGeneral fund, customs duties, user fees
Will Labor Cooperate? Will Foreign Will Labor Cooperate? Will Foreign Governments?Governments?
Dockworkers uneasy about TWICsDockworkers uneasy about TWICs
Other workers include truckers, sailors, Other workers include truckers, sailors, warehouse employeeswarehouse employees
U.S. security relies on foreign cooperationU.S. security relies on foreign cooperation
California Illustrates the Problems and California Illustrates the Problems and Promise of Port Security MeasuresPromise of Port Security Measures
Port ImportsTotal Value
CSI Coverage
(%)
Covered Source
Ports (%)
Los Angeles 86.8 77.1 59.7 4.8Long Beach 78.0 69.3 67.8 5.0Oakland 17.3 15.9 65.5 6.6Port Hueneme 4.7 0.2 34.3 33.3San Francisco 1.3 0.7 55.0 15.2
Containerized Imports
States with Major Container Ports Have States with Major Container Ports Have Good CoverageGood Coverage
0
10
20
30
40
50
60
70
80
WA SC VA CA NY GA TX MD LA PA FL
Imp
ort
s c
ov
ere
d b
y C
SI (
%)
Concluding RemarksConcluding Remarks
Federal government moved quickly into port Federal government moved quickly into port security, building on past effortssecurity, building on past efforts
Most port security issues receive some Most port security issues receive some attentionattention
Serious gaps remainSerious gaps remain– Openness of the supply chainOpenness of the supply chain
– Compliance and usefulness of measuresCompliance and usefulness of measures
– FundingFunding
An Overview of Port Security An Overview of Port Security ProgramsPrograms
Jon D. Haveman, Howard J. Shatz, andJon D. Haveman, Howard J. Shatz, andErnesto VilchisErnesto Vilchis
Public Policy Institute of California andPublic Policy Institute of California andPrinceton UniversityPrinceton University
Conference on Economic Costs and Consequences of a Terrorist AttackConference on Economic Costs and Consequences of a Terrorist AttackUniversity of Southern California Center for Risk and Economic Analysis of Terrorist EventsUniversity of Southern California Center for Risk and Economic Analysis of Terrorist Events
Los Angeles, California, August 20-21, 2004Los Angeles, California, August 20-21, 2004
