Cruise line bailouts -- your thoughts?

[b2bailey]

Found myself thinking about decisions that will be made. Glad I am not making them.

 

[geekette]

I am hard no. For starters, they are not critical infrastructure. Many Americans have never been on a cruise, so they are obviously not a necessity of life. Tourism is far down on the list of industries we should be funding.

They do not fly the American flag and do not generally hire American workers. They should seek help from their home countries.

Do they pay any US taxes? If they don't, then there is no reason that American taxpayers should bail them out.

 

[Brett]

I'm also of the opinion cruise lines are not essential public services
they should not be in line for government bailouts

 

[TravelTime]

I think it depends on how much they contribute to the US economy. They should only be assisted if they are significant revenue generators for the USA.

 

[CalGalTraveler]

Hard no. We need to spend money on ventilators, PPE and food/jobs/housing for people to eat. Pick up the ships at a deep discount when the businesses go belly up and convert to permanently house the homeless and/or provide low income housing.

I have always been amazed by how the cruise industry has grown and why people pay so much money to go on cruises. Much more expensive than timeshares.

 

[Luanne]

I think it depends on how much they contribute to the US economy. They should only be assisted if they are significant revenue generators for the USA.

I read somewhere that most, if not all, of the big cruise lines fly under the flag of another nation so they can avoid taxes in the U.S. I'm going to go check that out.

And I found this:

https://www.snopes.com/fact-check/cruise-ships-foreign-flags/

 

[am1]

What would happen to cruise ports and US based cruise industries if they go under? They bring in a lot of money to the US. Which powers that be own shares in the cruiselines or related businesses.

 

[TravelTime]

This article has convinced me that cruise lines do not contribute enough to the US economy in taxes. They should not be bailed out.

Why Lawmakers Are So Uneasy About Giving the Cruise Industry a Bailout

Major opposition to the idea of a cruise bailout is not centered on the virus fallout, but rather around criticisms that have dogged the industry for years.

skift.com

 

[WalnutBaron]

The cruise industry will be one of the last to be revived when the virus threat is over, for several reasons: 1) the cruise industry has been the poster boy for where not to be when a pandemic breaks out because you cannot escape it; 2) people will reluctantly begin to venture out for vacations by car first, hotels second, air travel third, and cruising a distant fourth; 3) by the time this is all over, we will have many fewer cruise ships plying the oceans and, perhaps, fewer cruise companies as well. And it won't necessarily be the largest cruise companies that survive, but those with the strongest balance sheets coming into this crisis.

Bottom line: do not bail out the cruise industry. I remember when a previous President chose to bail out Solyndra, a poorly-managed domestic manufacturer of solar panels. We all know how that went. Government should not be in the business of picking and choosing who survives and who doesn't.

 

[Passepartout]

They conciously DO NOT fly the American Flag, nor hire (many) American workers. Their primary ownership is foreign, though American investors' money is welcome- as well as the bulk of the money passengers pay. They'll have to demonstrate significant improvement in deference to American interests to get my unconditional support. Until then, I'll keep my funds safely in my trousers.

 

[WVBaker]

What would happen to cruise ports and US based cruise industries if they go under? They bring in a lot of money to the US. Which powers that be own shares in the cruiselines or related businesses.

Well at least one "powers that be" sold his shares of Wyndham Hotels and Resorts and Extended Stay America just prior to the coronavirus outbreak.

 

[b2bailey]

When I posted this, I had been thinking "Am I the only one who is not in favor of the U.S. handing out money to the cruise lines? Was glad to hear I'm not in the minority on this one.

 

[pedro47]

The cruise industry will be one of the last to be revived when the virus threat is over, for several reasons: 1) the cruise industry has been the poster boy for where not to be when a pandemic breaks out because you cannot escape it; 2) people will reluctantly begin to venture out for vacations by car first, hotels second, air travel third, and cruising a distant fourth; 3) by the time this is all over, we will have many fewer cruise ships plying the oceans and, perhaps, fewer cruise companies as well. And it won't necessarily be the largest cruise companies that survive, but those with the strongest balance sheets coming into this crisis.

Bottom line: do not bail out the cruise industry. I remember when a previous President chose to bail out Solyndra, a poorly-managed domestic manufacturer of solar panels. We all know how that went. Government should not be in the business of picking and choosing who survives and who doesn't.

This is a hard one.
In the States of Florida, New York, New Jersey, Maryland, California, Texas, Louisiana, Maine and Massachusetts the Cruise industry does support the local economy and the states tourism with some big dollars.

IMHO, each cruise line company were introducing to many new and larger cruise ship for the past five years.

I personally do not see the cruise industry bouncing back next year.

My bottom line: Our Federal government should help the cruise industry but do not give them a 100% free bailout. It must be a loan with a Guaranteed repayment loan. IMO.

 

[am1]

Off topic but what is needed to get cruise ships loaded with passengers and workers who are not affected and just start sailing until the world gets to a normal. Crazy idea but it could work if the company wanted it and governments allowed. Need an outbreak plan once on board.

 

[geekette]

Off topic but what is needed to get cruise ships loaded with passengers and workers who are not affected and just start sailing until the world gets to a normal. Crazy idea but it could work if the company wanted it and governments allowed. Need an outbreak plan once on board.

Nobody knows who is infected.

It is unlikely that a ship would be welcomed to ports. Few people could handle being on a ship for months, with no sure docking anywhere. Humans are land creatures.

A half full ship would have less chance of rampant infection, but, it only takes one passenger to infect masses of people.

 

[b2bailey]

Someone mentioned using old ships for homeless. I propose using for prison. Sail out too far to swim back.

 

[b2bailey]

I'm a side note, I am surprised by the number of ships still sailing out there. I heard of two more today.

 

[CalGalTraveler]

I'd rather see a bailout of the restaurant industry. Many American employees on the financial edge, and many communities affected.

 

[am1]

Right would need quarantine everyone before boarding somehow. No port of calls unless they were private islands (Bahamas) not sure if they could function without land support unless also quarantined but my guess there would still be a market. Not sure how they could get fresh produce etc but possibly by relief boats who went through a cleaning process.

But yes also using these ships are hospitals and places to quarantine people.

 

[bbodb1]

I read somewhere that most, if not all, of the big cruise lines fly under the flag of another nation so they can avoid taxes in the U.S. I'm going to go check that out.

And I found this:

https://www.snopes.com/fact-check/cruise-ships-foreign-flags/

And they find ways to avoid complying with U.S. minimum wage laws...

 

[bbodb1]

They conciously DO NOT fly the American Flag, nor hire (many) American workers. Their primary ownership is foreign, though American investors' money is welcome- as well as the bulk of the money passengers pay. They'll have to demonstrate significant improvement in deference to American interests to get my unconditional support. Until then, I'll keep my funds safely in my trousers.

White suit, right hip pocket?

 

[bbodb1]

Nobody knows who is infected.

It is unlikely that a ship would be welcomed to ports. Few people could handle being on a ship for months, with no sure docking anywhere. Humans are land creatures.

A half full ship would have less chance of rampant infection, but, it only takes one passenger to infect masses of people.

I do think a good number of ports all over the world are going to strengthen their requirements to make port. And that is a good thing.

 

[dioxide45]

While the cruise lines sail their ships under foreign flags, they do have large headquarter offices based in the US. US based customer support, US based onshore and port support. Thousands of tons of food is loaded onto ships every week, onshore workers, logistic, taxis, transportation, shuttles, pre and post cruise hotels. The industry extends far beyond the ships. All these employees that help support the cruise industry pay taxes.

While this isn't a reason that the US taxpayer should bail out the cruise industry, but there are the foreign ports. Many of which are somewhat poor that rely on the tourism in order to survive. So the cruise industry could easily be considered vital to them.

It should also be noted, that as far as I know, only two ships (both Princess) actually had confirmed cases on board. From reports of people onboard ships right before they stopped sailing, the ships were probably the cleanest place you could be. They were before too. The ships are kept meticulously clean, mainly because of fear of Norovirus outbreaks onboard. Norovirus is something else that is highly contagious, just not usually deadly.

 

[dioxide45]

I should add, I don't necessarily think they need a bailout. They do have a lot of assets that could be leveraged for liquidity. NCL apparently collateralized their NCL Epic ship right before things went from bad to worse. The problem is that every company right now is looking for liquidity and the banks only have so much to offer.

Edited to Add: I would expect any bailout be in the form of guaranteed loans. Loans pushed through banks to do the lending so they are also in charge to see that they are repaid. Any loans should also require certain contingencies, limits on stock buybacks. Requirement of creating and maintaining a certain contingency fund of operating costs, so when the next time this happens they can continue to pay their staff and cover other expenses and not come along with their hand out again. Once they build that contingency fund, then they can do whatever they want with stock buybacks, they just need to keep that contingency in place. It is amazing to see what were thriving companies basically bankrupt in the matter of a couple months.

 

[geekette]

I'd rather see a bailout of the restaurant industry. Many American employees on the financial edge, and many communities affected.

YES!

Fits my definition of "critical services" and helps small business.