Home > ALL POSTS > KIRBY SOMMERS reports on THE MURKY WATERS OF CARNIVAL CORP (OWNERS OF THE COSTA CONCORDIA) – Is the disaster the captain’s fault or the owners?

KIRBY SOMMERS reports on THE MURKY WATERS OF CARNIVAL CORP (OWNERS OF THE COSTA CONCORDIA) – Is the disaster the captain’s fault or the owners?

COSTA CONCORDIA – The captain’s fault or…?  Is Carnival Corp making the captain a scapegoat to avoid questions about  management or problems with the ship?

Carnival Corp’s first ship the Mardis Gras (former Empress of Canada) ran aground on maiden voyage.

History repeats itself.  Carnival Corp’s Costa Concordia hit land and so did Carnival’s first ship.  In 1972 the maiden voyage for Carnival Cruise Lines left port from Miami. The company would lose money in the early years (as one might expect). But to top things off the new cruise ship ran aground on a sandbar just outside the Port of Miami!

History of Carnival Cruises and History of Carnival Corp

Carnival Cruise Lines is a British-American owned cruise line, based in Doral, Florida, a suburb of Miami in the United States. Originally an independent company founded in 1972 by Ted Arison, the company is now one of eleven cruise ship brands owned and operated by Carnival Corporation & PLC. The company has the largest fleet in the group, with 23 vessels currently in operation that account for 21.1% of the worldwide market share. Executive control of the company is provided by the North American division of Carnival Corporation, headquartered in Doral, Florida.

The company is known for cost cutting, being anti-union, and now one of the great maritime disasters since the RMS Titanic.

Our thanks to Kirby Sommers for the following…

The Murky Waters of Carnival Corp (owners of the Costa Concordia)

by Kirby Sommers

Click here to read more from Kirby Sommers

In response to the largest passenger ship disaster since the sinking of the Titanic 100 years ago, Carnival Corp (CCL), has placed the blame entirely on Capt Francesco Schettino. A spokesperson for the company stated that Schettino made an “unapproved, unauthorized” deviation in the course of the Concordia whose hull was torn open on Friday 13th when the ship struck rocks off the island of Giglio, Italy.

As survivors speak angrily about their horrifying ordeal, images eerily similar to those seen in the movie Titanic have emerged. Sandra Rogers a 62 year-old grandmother from Minorca told a reporter from the Daily Mail: “There was no women and children first policy. There were big men, crew members, pushing their way past us to get into the lifeboats.”

Carnival Corp (CCL) claims the partial sinking of the Concordia will cost them approximately $85 million to $95 million in lost earnings for the year. When compared to the $6.5 million dollars Carnival paid for their first ship in 1972 one can safely conclude the company which now owns over 100 passenger ships has deep enough pockets and insurance to absorb this loss.

The origin and rise of the largest cruise company in the world is rooted in what some might call murky waters.

Meshulam Riklis and Ted Arison (born Theodore Arisohn) founded Carnival Cruise Lines. The pair became friends in Tel Aviv (the then British Mandate of Palestine) while attending school during the early 1940s. In 1971 Arison approached Riklis who owned, among other businesses, American International Travel Services (AITS) of Boston to help him get back into the cruise business.

Two previous ventures had soured for Arison. In 1968 the Israeli government impounded his small cruise ship for monies owed. Instead of paying the money to retrieve his ship, he abandoned it, swiftly putting all the passengers onto another vessel. The second incident happened soon thereafter in 1971 after when Arison had a nasty falling out with his Norwegian Caribbean Cruise Line (NCL) partner Knut Kloster.

Riklis and Arison had more than just a school in Israel in common. They both earned well deserved reputations of being ruthless barracudas in their primal pursuit of financial gain.

The enterprising Riklis/Arison pair purchased “Empress of Canada” from Canadian Pacific for $6.5 million and renamed the ship “Mardi Gras”. On its maiden voyage it ran aground with approximately 500 people on board before it ever left Miami.

In February of 1973 Riklis used AITS to purchase the Riviera Hotel in Las Vegas for $56 million. The hotel had ties to infamous mobster Meyer Lansky. The Nevada Gaming Commission had Riklis dispose of its interests in Carnival or lose the hotel’s gaming license. Riklis and Arison exchanged a document whereby Riklis sold his 50% share in Carnival for $1. People familiar with the transaction believe the Riklis family still own a portion of Carnival.

Carnival Corp. (as it is known today) became the mega giant it is by registering their ships in foreign countries in order to avoid paying U.S. taxes. The company is also notoriously known to exploit Third World laborers who work on their ships for slave wages. A recent lawsuit by a former employee shows the company paid him a paltry $1.70/hour. Their lobbyists, on the other hand, receive a small fortune to ensure tax laws don’t change in Congress.

On October 8, 1999, almost 10 years after Arison denounced his U.S. citizenship and returned to Israel in an effort to avoid paying estate and inheritance taxes, he passed away of a heart attack at the age of 75.

Arison’s son Micky became Carnival’s CEO. In 2012 Micky’s net worth was estimated at $4.5 billion (after dropping $1.3 billion) according to Forbes Magazine.

His daughter Shari inherited one-third of his wealth making her the richest woman in Israel.

In 2010 a then 86 year-old Meshulam Riklis married 51 year-old Tali Sinai. When asked exactly how much he was worth by a reporter, the billionaire replied: “What difference does it make? I can only wear one pair of shoes at a time.” His son, Ira Riklis, told this writer on numerous occasions that his father worked hard on staying off the Forbes 400.

Riklis is alleged to have ripped off dozens of companies. The story appeared in Forbes Magazine in a piece called ‘The Check is Not in the Mail’ by Nathan Vardi:

More information on Carnival’s first ship:

The EMPRESS OF CANADA became the pioneer ship in the Carnival Cruise Lines fleet. She was renamed MARDI GRAS on 14th February, 1972. Her departure from Tilbury was delayed by the National Union of Seamen and Sam McCluskie, the NUS organizer, said: “We are picketing this ship in order to combat the growing menace of crews of convenience. Their low pay undermines the hard-won wages and conditions which the NUS has fought for.” Tug crews and lock gate men at Tilbury ‘blacked’ the MARDI GRAS and she did not sail for Miami until 26th February.  Carnival Cruises was initially in a very weak financial position and it was essential that the MARDI GRAS should earn money immediately. There was no time for a refit and on 11th March 1972 the MARDI GRAS left Miami on her first cruise for Ted Arison. At that time she was the largest liner using the port of Miami and was too deep-drafted, with the result that in fully laden condition the MARDI GRAS ran aground on departure. After twenty-four hours of fruitless effort to free her, the passengers were disembarked. She was eventually re-floated and inspected and not found to be making water. The cruise continued.
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