Cruising in the Global Economy

Profits, Pleasure and Work at Sea

Christine B.N. Chin

• Publisher: Routledge
• Year: 2016
• Print ISBN:
  9780754672425
• eBook ISBN:
  9781351947176
• Topic: Politics & International Relations
• Subtopic: Politics
• Index: Politics & International Relations

The business of cruise tourism in recent years has commanded news media attention especially on issues of environmental pollution, passenger safety and worker rights, yet consumer interest in cruise vacations has not been adversely affected by negative publicity and it continues to grow at an average of 8-9% per annum. This unique mode of business focusing on the production and consumption of pleasure at sea and on land offers us an unprecedented opportunity to analyze the manner in which ongoing economic restructuring processes to bring about free markets in goods, services and labour can and does involve both life on land and at sea. This interdisciplinary analysis elicits an examination of states' relationship to the maritime regulatory structure governing ship ownership, management and operations, cruise lines' business strategies, development of port communities to capture cruise-related revenue, changing leisure consumption patterns and meanings, and the employment of foreign migrant workers as seafarers.

Chapter 1
Making the Connection: Profits, Pleasure and Work on the Open Seas

A tree so big it can fill the span of a man’s arm grows from a tiny sprout. A terrace nine stories high rises from a shovelful of earth. A journey of a thousand miles begins with a single step.

Lao Tzu, circa 600 B.C.E (trans, by Ni 1997, 83)

A society’s reactions to the events of the day, to the pressure upon it, to the decisions it must face, are less a matter of logic or even self-interest than the response to an unexpressed and often inexpressible compulsion arising from the collective unconscious.

Fernand Braudel (1987, 22)

The large cruise ship’s horn blows to announce its arrival in Sint Maarten waters as a warm breeze makes it seem as if its flag is waving hello to all. Many may or may not notice the flag, but if they do, it becomes apparent quickly that it is not the national flag of the US, even though the ship set sail carrying over 1,000 passengers from a US embarkation port. The flag could belong to countries such as Panama, Bahamas or even Italy.

Shore-side businesses (tour operators, restaurants, taxis, car rentals and retail shops) prepare for the onslaught of throngs of potential customers as passenger debarkation will be followed shortly by seafarers, some in uniform and others in civilian clothing. They may come from as close by as the US, Canada, Honduras and Venezuela, to as far away as Bulgaria, Greece, South Africa, India, Indonesia and the People’s Republic of China. If two ormore large cruise ships arrive at the same time, then the port of call will host thousands of visitors that day.

The sheer number of cruise passengers, young and old, immediately leads to massive congestion on Philipsburg’s roads and sidewalks as they go in search of new sights, food, ground transportation and/or duty-free items for purchase. Seafarers who have visited this port many times over the course of a few months may be more interested in replenishing personal supplies and/or searching for seafarer-friends from ships that have arrived at the same time. For the next few hours, a cacophony of spoken languages will permeate the public spaces of Philipsburg.

Meanwhile job schedules keep some seafarers shipboard cleaning cabins and public areas, preparing meal service or, in general, catering to passengers who chose to remain onboard. Toward the end of the day, traffic will reverse direction as passengers and crew members embark the ship to set sail for its next port of call that may include a ‘private island’ owned/leased by the cruise line exclusively for passenger recreation.

To a large degree, organized chaos of this kind will be repeated elsewhere in the Caribbean basin (including Southern ports of the US and Mexico’s Yucatan peninsular), and along North America’s west coast from Alaska all the way south to Ixtapa in the ‘Mexican Riviera’. Aptly named in the industry as ‘mass market’ cruising, large cruise ships that carry anywhere from approximately one thousand to several thousand passengers are calling also at destination ports in other regions such as South America, Southeast Asia and the Mediterranean, with new itineraries planned for East and South Asia. Deep ocean pleasure cruising is enjoying a renaissance that transcends its elitist origins in transatlantic voyages.

Since the last decades of the twentieth century, the numbers of passenger-tourists worldwide have grown steadily as cruise tourism is made affordable for many more people. In 1989, a total of four million passengers travelled on cruise ships in all regions of the world. By 2005, the number had risen to over 11 million passengers (CLIA 2006b; Mathisen 2005). Some destinations within the Caribbean basin have been experiencing exponential growth, e.g., the percentage of cruise passengers in Belize increased by 80 per cent to 575, 196 in 2003 (CTO 2004, 132). One year later, the percentage increased again by 48 per cent to 851, 436 (CTO 2004, 14).

Straddling the global shipping and tourism sectors, the business of deep ocean pleasure cruising averages an annual growth rate of eight to nine per cent. This is remarkable especially given the slower or even negative growth rates of other sea-based transportation, and land-based tourism industries.¹ There are new ship-build orders for large or larger/mega-ships (with the carrying capacity of over three thousand passengers, excluding seafarers) to be delivered in the next few years; improvements in or new constructions of port facilities in the US and elsewhere; the proliferation of internet sites specializing in all aspects of cruise vacations; and sustained demands for seafarers from all over the world. There may be as many as 80–90 nationalities of seafarers on board cruise ships today.

The attraction of mass market cruise tourism perhaps is captured nicely in recent years by Princess Cruises’ media advertising campaign (e.g., in newspapers and magazines) built on the motto, ‘Escape Completely’. Cruise vacations offer passenger-tourists opportunities to leave behind the ‘hassles’ of their everyday life in return for extraordinary experiences. They are able to visit a succession of foreign destinations without the hassles of coordinating point to point flight schedules with hotel reservations, packing and unpacking suitcases, searching for good local restaurants as well as tourist sites and having to make their own way there. On the ship, they will be pampered by seafarers, e.g., passenger-tourists can enjoy a variety of entertainment programming and cuisine, spa treatments, twice-a-day cabin service, and so forth.

Mass market cruise tourism’s popularity today is a testament of cruise lines’ success in catering to different market segments as prospective vacationers (from retirees to young couples and families with a variety of interests and greater disposable incomes and/or access to credit) select from a range of packages and destinations. The more people desire and are able to afford cruise vacation packages, the more profits cruise lines will make and reinvest to increase berth capacity, offer more itineraries as well as shipboard amenities that, in turn, attract more passengers, subsequently increase employment opportunities to seafarers from all over the world.

Punctuating the positive growth picture, however, are controversies surrounding certain cruise line practices. They have been accused of deploying bully tactics to reverse proposed legislation in some port communities; polluting coastal and deep waters; failing to ensure passengers’ personal safety; and operating ‘sweatships’ of low wage foreign seafarers. In recent years for example, cases of alleged criminal activities affecting passengers on cruise ships have garnered global media attention (e.g., a female passenger who was assaulted on an Australian cruise, and a male passenger who went missing on a Mediterranean cruise).²

This begs a very important question, ‘Why and how do the interrelated processes of cruise lines’ pursuit of profits, passengers’ consumption of pleasure, and seafarers’ performance of work that occur in an arena said to “belong to all and to no one”, generate an underside of loss, pain and servility respectively for some communities, passengers and seafarers?’ To frame the question in this way is not to deny that cruise line profits come from selling vacation packages to consumers while controlling operating costs. Rather, it is to facilitate analytic clarity of why and how the whole cannot exist without each part, as well as the relationship between specific parts to one another and to the whole. Cast in this way, we can better grasp the complexities of, and contradictions emanating from, these interrelationships.

Despite or perhaps because of the fact that cruise lines are headquartered on land, their ship operations represent a unique mode of business conducted, pleasure experienced and work carried out primarily on international waters with brief interregnums at home ports and foreign ports of call. The story of mass market cruise tourism’s phenomenal growth since the late twentieth century appreciatively is complicated because its plot takes place on terra firma and at sea linking communities on the local, national, regional and global levels, as well as blurring what are considered the distinct realms of leisure and work.

To answer the question then, we first need to unpack it. How have cruise ships come to fly national flags that have no correspondence with their home ports or cruise lines’ headquarters? What is the nature of states’ relationship to promoting and/or regulating profits, pleasure and work at sea? To what extent are existing national and international legal instruments, mechanisms or regulations effective or not in governing ocean-based industries that transport people and/or goods? For whom and how do cruise lines produce pleasure? In what ways does the production of pleasure affect passenger safety, and/or social and physical environments? Are most passengers aware of contradictions arising from the production-consumption nexus, and if so how do they respond? Why have seafarers from all over the world come to work on cruise ships? Who gets to perform which jobs and under what conditions?

By examining states’ relationship to the maritime structure regulating ownership, management and operations of oceanic vessels; mass market cruise lines’ business strategies of generating profits from the production of pleasure; passengers’ expectations and experiences of consuming pleasure; and foreign seafarers’ work on cruise ships, we can ascertain more clearly why and how the contradictions of loss, pain and servility accompany that of profits, pleasure and work at sea. Mass market cruise tourism’s sustained popularity offers us the unparalleled opportunity to conduct an inter-disciplinary study that draws from, as well as contribute to integrating knowledge of states’ relationship to capital in an era of global free markets, the production-consumption nexus in tourism, and the migration of foreign workers. It is pertinent to stress that existing stocks of knowledge on the state, tourism and migrant labour have life on land as their common referent point, e.g., state policies of regionalism as a key response to regulating capital flows freed from restrictive national regulations;³ collaboration between state, tourist firms and communities in developing sustainable modes of tourism;⁴ consumers’ motivations and identities in leisure travel at home and abroad;⁵ and cross-border movements of men and women for work in labour-receiving countries.⁶ Hence, while we know much of the ways in which landed life and activities are being reconfigured within a global political economy of constructing and integrating free markets, we know comparatively little of what is happening on the open seas.

This study’s conceptual framework, designed to cut across different levels of analysis and realms of social life, encourages a comprehensive examination of the relationship between state regulation of oceanic capital, cruise lines’ pursuit of profits, passengers’ consumption of pleasure and foreign seafarer’s performance of work. We will find that processes arising from, and affirming the overall structure of free markets cannot but generate an underside connection of loss, pain and servility that comes with the pursuit of profits, pleasure and work at sea in mass market cruise tourism. These contradictions will persist so long as they are explained away either as by-products of a fledgling global industry, and/or miscalculations of costs and benefits in free market exchange, instead of inherent structural tendencies being shaped by and shaping the conduct of states, cruise lines, port communities, passengers and seafarers. Notably, such explanations tend to minimize or ignore a relationship between morality and conduct in the free market, hence mitigate serious considerations of why and how it is important to assuage the underside connection of loss, pain and servility.

Regulating a Borderless Maritime World

Since the mid-late twentieth century, states have embarked on a gradual retreat from intervening in their economies. Instead of owning-managing industries and/or distributing subsidies, state agencies increasingly are expected to maintain the context for free market operations that render economic life more efficient, productive and competitive, with the objective of improving the human condition for all.

The justificatory context for removing state intervention came in the midst of structural crises (as seen in inflation and unemployment rates, growing deficits and so forth) experienced by major Organisation for Economic Co-operation and Development (OECD) economies that, by the early 1980s, affected countries of the Global South as well. A key outcome was the ‘liberation’ of distinct territorially-based capital from highly restrictive home and host country regulations. Derived from, and informed by neoliberal policies of economic liberalization, privatization and deregulation, the operative vision would be that of a borderless world for capital. Paradoxically, the logic of free market’s global or ‘transplanetary’ reach and outcome is to be affirmed by, and within, an existing political system of states (Scholte 2000).⁷

Particularly in the US and Western Europe, responses to structural crises initiated highly contested processes of dismantling state-mediated Fordist pacts between capital and labour, most notably the weakening of regulations governing labour rights and benefits. At the very same time for land-based industries, new production technologies first aided in parcelling out of the mass production process (from parts to whole assembly) to different countries in the world, eventually followed by the adoption of niche-based production. Mass production and its corollary of mass consumption under the Fordist system gave way to niche production and consumption characterizing the present post-Fordist system. Meanwhile, economies of the Global South gradually came under International Monetary Fund (IMF) and World Bank mandated structural adjustment programs (e.g., currency devaluation and drastic cuts in public expenditure) with a similar overall intent of commanding the state’s retreat from the economy.

In the Fordist era, states were conceptualized either as autonomous from, or able to balance competing interests while functioning to provide public goods; a tool serving corporations; or a protector of the capitalist system even at the expense of alienating the owners of capital (Dahl 1971; Domhoff 1979; Miliband 1983; Poulantzas 1973). The shift to post-Fordism, however, called for different conceptualizations of the state especially since multi-national corporations became transnational in their operations: corporations no longer were restricted to domestic sources of capital, bound by traditional domestic chains of raw material supplies and labour, nor subject to mandated benefit packages for workers, all of which were seen to have undermined economic efficiency, productivity and competitiveness, hence potential profits. Bolstered by applications of new technologies, corporations have and continue to parcel-out the production process to different parts of the world, i.e., more freely move capital while scouring the world for low wage material and labour resources.

Drawing on empirical evidence from land-based industries, scholars argue that state regulatory power in the context of capital’s ‘hypermobility’ (Beck 2000; Harvey 1989) is considerably weakened, leaving a hollowed out ‘defective’ state evinced from implementations of economic liberalization, privatization and deregulation policies (Boggs 2000; Strange 1996). At the very same time, states can and do enter into partnership with, or in the service of transnational capital, hence becoming ‘competition’ or ‘efficient capitalist’ states (Cerny 1997; Hirst and Thompson 1999; Panitch 1996; Opello and Rosow 1999). As a result, states increasingly confront the contradictory pressures of facilitating transnational capital flows while maintaining domestic legitimacy at the same time (Sassen 2001). One key response to these pressures can be discerned from the move to construct new or to strengthen existing regional groupings (Farrell, Hettne and van Langehove 2005; Stubbs and Underhill 2005). In spite of state efforts at regional integration to better coordinate regulation of capital across place and space, the maritime world remains largely separate from, or peripheral to, a primary focus on landed activities.

However, the phenomenon of ‘offshore tax havens’ most often associated with firms’ and individuals’ attempts to shelter capital, offers a conceptual window through which to better understand and integrate the pursuit of profits with state regulatory power on land and at sea (Blum 1984; Diamond and Diamond 1998; Gilmore 1992). At the outset, offshore tax havens may seem merely as capital’s response to restrictive home state regulations by ‘relocating to relatively unregulated realms that present themselves as external to the state’ (Palan 2003, 3).⁸ Yet, Palan’s analysis of their historical origins demonstrates that offshore tax havens should not be understood primarily as the outcome of resistance to state regulatory power per se since they are the creation of states. Rather, offshore tax havens are integral to the ‘continuing process of state formation in a period of intensified capital mobility’ (Palan 2002, 153). In other words, capitalism’s gradual worldwide expansion does not occur in spite of the state, but changing modes of state regulation are deeply implicated in the process.

Since ‘the rise of offshore is an inherent tendency of an internationalizing economy operating within a particularistic political system’ (Palan 2003, 9) the state then has not lost its regulatory power as much as reconfigured it. Increasingly, states today are encouraged to ‘lease’ their regulatory power in the form of offshore tax havens:

[states accrue] ‘rent’ or license fees in return for granting firms a right to incorporate in their jurisdictions… The principal attraction of tax haven and the main cause for their spectacular success lie in their ability to provide protection from national regulation and taxation without the need to physically relocate to the host country [my emphasis] (Palan 2002, 163).

An inescapable observation is the commercialization of state sovereignty.

Offshore tax havens, to be sure, are located still in place, i.e., on physical territory of host states. Yet, tax havens are constituted to operate mainly in space given the electronic set up and management of accounts. In this way, tax havens can be considered ‘purely juridical residences’, or as Palan further clarified, they are ‘fictional’ juridical residences created by host states to shelter capital: foreign corporations and individuals need never physically relocate there.

In this new global political economy, state establishment of offshore tax havens begins to foreground an emerging ‘shadow’ state system and mode of regulation that operates in space more so than place. One consequence of this space-place bifurcation is that the offshore tax haven ‘[helps produce] an economy that is serving to destabilize established concepts of place, territory and identity’ (Palan 2003, 162).

What, then, is the link between offshore tax havens and the maritime world? The adjective ‘offshore’ already connotes locations beyond contiguous land mass, e.g., the more commonly known tax havens of island states such as the Bahamas a...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Table of Contents
• Dedication
• List of Tables
• Acknowledgements
• List of Abbreviations
• 1 Making the Connection: Profits, Pleasure and Work on the Open Seas
• 2 Flags of Convenience: Sovereignty-for-Lease in the Maritime World
• 3 Floating Resorts: Political Economy of Pleasure Production
• 4 Structured Hedonism: Consumption of Deep Ocean Pleasure Cruising
• 5 ‘Mini-United Nations’: Foreign Migrant Labour on Cruise Ships
• 6 Navigating Morality in and for the Twenty-First Century
• Bibliography
• Index