California Delegation Out to Sea

Long Beach is about to lose the chance to lease a terminal through its port to a major shipper, China Ocean Shipping Co., or Cosco, because a congressman from San Diego created a piece of legislation that prevents Long Beach from doing so.

That’s a loss to Long Beach because the community could have benefited to the tune of $20 million a year. Cosco would have leased a whole terminal on the site of the former U.S. Naval Station, rather than shipping through shared facilities as it has done for 17 years.

But far more important, the episode is a loss to all of California because it reflects how badly the state is served by a frequently divided and often inattentive congressional delegation.

A matter concerning foreign trade, one of the state’s most important economic activities, was defeated because of strong ideological feelings of a few of California’s 54-member delegation in Washington and the timidity or carelessness of most of the rest.

That is no way to advance the jobs, incomes and interests of California’s taxpayers.

The Cosco prohibition, included in the National Defense Authorization Act last year and stiffened in its provisions this year, was inserted by Rep. Duncan Hunter (R-El Cajon). Hunter opposed the lease on the grounds that Beijing-based Cosco is a quasi-military operation that would bring spies in through the port of Long Beach.

He was joined by other members of the California delegation, Reps. Randy Cunningham (R-San Diego) and Dana Rohrabacher (R-Huntington Beach) among them.

But the Defense Department and the Federal Bureau of Investigation were asked to look into Cosco, and both have delivered to the White House reports that find no security risk, Washington sources say.

In fact, it was a phony issue from the start. Few people really believed Cosco--which carries cargo from China to the ports of Norfolk, Va.; Seattle; Oakland; Baltimore; Charleston, S.C.; New York; Portland, Ore.; New Orleans; and Mobile, Ala., as well as Long Beach and Los Angeles--was a security risk.

But anti-China sentiment helped Hunter and Sen. James Inhofe (R-Okla.) plant the Cosco provision firmly into a defense authorization bill that is now going to the White House. President Clinton might still be able to turn the issue around by issuing a waiver allowing Long Beach to lease to Cosco a terminal, to be built on the closed Naval Station site.

In the California delegation, Reps. Jane Harman (D-Torrance) and Loretta Sanchez (D-Garden Grove) opposed the anti-Long Beach provision as members of the House National Security Committee. Rep. Stephen Horn (R-Long Beach) sent opposing letters to the committee and Sen. Barbara Boxer waged a fight for Long Beach in the Senate.

For the rest, the sentiment, as one legislative aide put it, was that “no one was going to brave the talk radio attacks as being soft on communism and China just for Long Beach.”

That’s typical. “The state is geographically large and politically diverse, so it is difficult to get the members to unite on a question,” explains Tim Ransdell of the California Institute for Federal Policy Research. That’s the Washington office funded by business, labor and other groups to help the state’s delegation on legislative issues. The institute is nonpartisan and did not get involved in the Cosco question.

But seeing the issue as local or even one of ideology misses the point. The terminal was about trade, not about a local Long Beach issue. “Foreign trade through California ports, whether produced or shipped into the state, represented about 44%” of the state’s gross output of goods and services last year, according to a new report by the Santa Monica-based Milken Foundation.

That is to say almost half of every dollar of economic activity in California is connected to trade, as compared with only 18 cents of every dollar for the whole United States.

Illinois and Texas are other states heavily trade dependent. And when legislation concerning the economy of their state comes up, you bet their congressional delegations vote together for the home team.

The ominous irony of the whole situation is that California can’t afford to be casual about trade-related business. The Milken Foundation report, titled “The Asian Crisis Tsunami,” predicts that the state’s economic growth could decline to 2% next year and 1.2% in 2000, with rising unemployment, because of the drop in exports to Asia.

The problem in the Cosco matter is not that company’s specific business. Cosco is one of 23 shipping companies moving goods to and from China through the Port of Long Beach. The problem is attitude. The behavior of California politicians signals to the world that the state is not serious about business. It’s a message underlined by the many lawsuits Long Beach has faced in trying to convert the Naval Station. The suits came from groups seeking to preserve decrepit military buildings.

Other ports, such as Seattle or the New York/New Jersey complex, are always happy to lure business by disparaging “Looney Tunes California.”

The conclusion of this matter: Either Long Beach will find a way to accommodate Cosco or the neighboring Port of Los Angeles will lure its business to a new container terminal. Mayor Richard Riordan made a sales pitch for the port during his visit to China last February.

But Rep. Hunter and Sen. Inhofe have threatened to bar Los Angeles also from dealing with Cosco. And they will make their threat stick, unless California’s huge delegation starts working seriously on the state’s business.

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James Flanigan can be reached via e-mail at jim.flanigan@latimes.com.