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Press Release · June 27, 2006

Protecting The Ports: Are U.S. Security Measures Missing The Boat?

No Guarantees Against Terror Attacks; Focus on Recovery Should Be Primary

SAN FRANCISCO, California, June 27, 2006 — A new study of U.S. seaport security delivers a message that leaders and citizens may not want to hear: Because there is no foolproof way to protect America’s ports from a terrorist attack, current policies and programs need to focus much more on recovery and economic restoration. In a report released today by the Public Policy Institute of California (PPIC), a team of economists and maritime security experts looks at an array of security issues to provide one of the most comprehensive examinations of port security to date.

Given that 41 percent of U.S. international trade passes through the nation’s 361 seaports and that millions of American paychecks depend on this flow, how devastating would an attack be to the nation’s economy? The report’s chapters provide a range of estimates: At the high end, some of the authors argue that an attack on a major seaport such as Los Angeles-Long Beach could cost the nation tens of billions of dollars. However – if response and recovery is appropriate and sufficient – other authors find that the economic cost would be relatively small.

The study evaluates security provisions put in place by the federal government after September 11, when protecting the nation’s ports quickly and all at once was the impulse. Limited staff, time, and money have led to slipped schedules, unclear priorities, uncoordinated strategies and programs, and vague lines of responsibility. One example is a program to roll out identification cards for transportation workers, which is now years behind schedule.

“No matter what we do to protect the ports, it will not be enough to ensure – absolutely – against an attack at some location,” says PPIC program director Jon Haveman, who edited the volume with PPIC research fellow Howard Shatz. One of the report’s strongest recommendations is that comprehensive recovery plans be created specifically to reduce economic panic and to restore global supply chains quickly following a catastrophe. “How well government reacts to the problems caused by an attack is probably as important as how well it anticipates them,” adds Shatz. In fact, the authors also suggest that rigorous recovery plans can serve as a disincentive to terrorists, who have been shown to focus on targets where they can do the most damage—economic and otherwise.

Besides recovery, the authors recommend a number of important but potentially costly security measures. The report, Protecting the Nation’s Seaports: Balancing Security and Cost, says it is critical to implement these measures in such a way that justifies the costs and balances different types of threats – because strengthening one target along the maritime supply chain, or even the entire supply chain, necessarily means making other targets more vulnerable.

Measures would include continuing a “layered” defense whereby there are several tracking, screening, and inspection points for shipping containers as they flow from the foreign country’s factory gate, through the maritime domain, to U.S. shores; using multiple technologies such as radiation detectors and container tracking devices; steering government development of new technologies toward areas that the private sector has no incentive to pursue; strengthening emergency response at the nation’s ports; strengthening terrorism insurance markets; and reevaluating the level of overall port security funding and staffing for public entities that focus on port security, such as the U.S. Coast Guard.

The Public Policy Institute of California is a private, nonprofit organization dedicated to improving public policy in California through independent, objective, nonpartisan research on major economic, social, and political issues. The institute was established in 1994 with an endowment from William R. Hewlett.