Walters: Shipping needs are at odds with California’s climate goals

The machinery of logistics — ships to trucks to locomotives — produces tons of particulate emission

In retrospect, Southern California’s political and civic leaders may have made a mistake a half-century ago when they decided that developing a massive logistics industry centered on the twin ports of Los Angeles and Long Beach would be critical to the region’s economic future.

Hundreds of billions of dollars in public and private funds have been committed to upgrading the ports to handle larger container ships, constructing dozens of warehouses and other facilities in San Bernardino and Riverside counties, and improving rail and highway corridors connecting them to the ports.

It paid off in the long run.

As the shipment of goods from Asia — particularly China — grew, the twin ports eventually claimed up to 40% of the nation’s import traffic, and logistics became, by some measures, Southern California’s largest single employer. When another mainstay, aerospace, plummeted three decades ago after the Cold War ended, it bolstered the region’s economy.

Nonetheless, the industry may have peaked. Factors such as the expansion of the Panama Canal, the emergence of India and other nations as goods suppliers, congestion in the twin ports and transportation corridors, labor conflicts, and growing local opposition to the environmental impacts of logistics pose potentially existential threats.

West Coast ports recently signed a new six-year contract to end a long-running dispute with the International Longshore and Warehouse Union. During the dispute, however, wildcat work stoppages clogged traffic through the twin ports, and some shippers relocated to East Coast and Gulf ports. According to the Pacific Merchant Shipping Association, import volumes at the twin ports fell by nearly 25% in the first six months of 2023, owing not only to labor unrest but also to a sharp downturn in the Chinese economy.

The executive director of the Port of Los Angeles, Gene Seroka, told the Wall Street Journal that recovering the business “will be an uphill climb.” Our job now is to be relentless in pursuing every pound of freight possible.”

Tons of particulate emissions are produced by logistics machinery, from ships to trucks to locomotives. They and the warehouses they serve also contribute to traffic congestion and noise, and the physical presence of logistics breeds resentment, which eventually leads to political and legal action.

The South Coast Air Quality Management District has consistently increased pressure on industry to reduce polluting emissions by electrifying trucks and other heavy equipment. According to industry leaders, the demands impose costs that make the region less competitive with alternatives, particularly East Coast and Gulf of Mexico ports.

The SCAQMD is on the verge of issuing an overall draft rule to limit pollution from the ports, and last month, labor and management officials, as well as representatives from a variety of business organizations, wrote to the mayors of Los Angeles and Long Beach, raising concerns about what they see as a potentially fatal blow to the ports’ long-term viability.

“The initial SCAQMD staff proposal essentially establishes volume caps on port activities, which will restrict the delivery of critical imported goods, including essential construction, manufacturing, and automobile components, as well as medical supplies, and will halt the export of California’s manufactured goods and agricultural products to foreign markets,” the coalition informed the mayors.

As details of the proposed rule became public in August, the state Assembly’s Select Committee on Ports and Goods Movement held a hearing in which legislators expressed concern about the potential economic impact.

Southern California may have made a mistake by putting so many of its economic eggs in the logistics basket, but it is now a test case for whether California can handle the potentially massive economic fallout from converting to a net-zero emission society, as Gov. Gavin Newsom and other political figures have pledged.

Dan Walters is a columnist for CalMatters.