Impact of port attack assessed Economic damage would mushroom By KRISTEN <mailto:[EMAIL PROTECTED]> MILLARES BOLT P-I REPORTER http://seattlepi.nwsource.com/attack/285352_port16.html A bomb exploding at the Port of Seattle would be just the beginning of the misery. The economic shockwaves of a terrorist attack would begin along the waterfront but soon spread up the supply chain, mushrooming as they went. A cargo security bill passed by the Senate Thursday would create a better system for tracking and monitoring cargo coming into this country in an effort to prevent such a scenario. That bill -- which must be reconciled with a House version and approved by both chambers before it's sent to the president -- also detailed a path for the resumption of trade if something were to sneak through. The worst-case scenario would be a nuclear attack. Those costs -- emotional, economic, political -- are too staggering to contemplate for most: Interstate 5 closed down; downtown Seattle off-limits; long-term health care for those caught in the radiation. Just how bad it could get should a violent disruption of commerce occur, however, is still the subject of debate. To try to comprehend the severity of the damage, even if narrowed only to trade, it is useful to look at the most recent shutdown of the ports: the 2002 West Coast lockout that lasted 11 days. Taking a closer look at what happened, though, reveals differing opinions on trade's relationship with our economy. Some, when assessing the possibilities of an attack, cite economic costs of between $1 billion and $2 billion per day -- depending on how long it lasted -- if all West Coast ports were shut down. Those figures trace back to a 2001 study prepared for the Pacific Maritime Association, an industry group whose main purpose is to negotiate with the International Longshore and Warehouse Union. Nearly one year after the study was published, terminal operators locked out workers at 29 West Coast ports, accusing them of dragging their feet at work to gain traction in bitter contract disputes. The study's estimates -- beginning at $934 million a day for the first five days, and over 10 days escalating to $1.94 billion a day -- were cited extensively by newspapers, retail and maritime groups, economists and political pundits. Ten days into the lockout, the federal government ordered the ports reopened because of the threat to the national economy. About the same time, another study -- conducted by the Anderson Economic Group -- was released, calculating a 12-day shutdown's total harm at $1.7 billion. The reason for the vast disparity? The study's author, Patrick Anderson, believed that monies shown as lost by the other study were mostly redistributed. If, for example, air freight costs rose as exporters sought alternative means to clogged ports, that may be recorded as a cost to the exporter -- but it is money in the pocket of the air freight company's owner. And, Anderson wrote, most durable goods shipments were delayed rather than canceled. The loss in wages of 10,500 West Coast dockworkers, about 2,000 of them in the Seattle area, during those 11 days was significant. So too were the lost work hours for all of the retail, distribution and transportation workers who rely on the port's goods to keep in business. The industry study estimated $693 million in lost federal, state and local taxes over 10 days. But when it comes to parsing that down to only Washington, that figure gets harder to nail down. "If you go back in history and say, 'Hey, is there anything special about this period that was disruptive statewide?' you don't see much," said Eric Swenson, an economic forecaster with the Washington State Economic and Revenue Forecast Council. One reason may be because shipping companies had advance notice in 2002 that the lockout would occur, and were able to plan accordingly. A terrorist would give no warning. That means that the impact of a shutdown would become dependent on how many ports were shut down. "If only a specific port shut down, you would see that freight move immediately," said Jim McKenna, president of the Pacific Maritime Association. "If (the ports of) Seattle or Tacoma shut down, it would redirect to Southern California ... and the Panama Canal." If, however, all of the West Coast ports were shut down, the Panama Canal would not be able to handle many of the bigger ships. At first, "the big victims would be the longshoremen and the truck drivers, and some agricultural exports would begin to rot,," said Stephen Cohen, a professor of regional planning at the University of California at Berkeley. If it kept going, "each day would have a much bigger impact." Agricultural products form one-eighth of the state's exports. "About one-third of crops produced in Washington state are sent overseas, so even a short shutdown would have a dramatic impact," said Jason Kelly, a spokesman for the state Department of Agriculture. No matter which study you go with, as Port of Seattle Chief Executive Mic Dinsmore said: "It would be incredibly painful." P-I reporter Kristen Millares Bolt can be reached at 206-448-8142 or [EMAIL PROTECTED] (F)AIR USE NOTICE: All original content and/or articles and graphics in this message are copyrighted, unless specifically noted otherwise. All rights to these copyrighted items are reserved. 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