Summary: It's no understatement to say times have changed since 1920 when the Jones Act was passed. The law has had a lot of unintended side effects.
Released: Filed Under: Stoa Policy
About "Jones Act (AFF)"
The Jones Act, officially the Merchant Marine Act of 1920, is an old law still on the books that Congress thought was needed based on their analysis of conditions during the Great War (i.e. World War I). It’s no understatement to say times have changed since then, and the law has had a lot of unintended side effects.
The Jones Act requires ships carrying cargo between two U.S. destinations to be: built in the US, owned by US citizens, staffed by US citizens, and registered/flagged in the US. For example, any ship could legally transport cargo from Boston to Halifax, Canada. But to transport the same cargo from Boston to New Orleans would require a “Jones Act” ship. The Act has the effect of carving out a protected market for a small number of ships and crews who can conduct such trade without irritating competition from the rest of the world. Prices get raised and service declines accordingly, when competition is blocked. The impacts are billions of dollars for consumers nationwide but particularly for US citizens residing in places specifically dependent on shipment of goods from the US mainland – like Alaska, Hawaii and Puerto Rico.
Negatives will argue that the economic arguments are insignificant and that the national security impacts of the Jones Act outweigh them. Preserving a viable ship manufacturing industry in the US, along with experienced crews and shipping companies, is a vital national asset that would make the difference in a major war. For example, US efforts in World War 2 relied heavily on American boats shipping cargo to Europe to aid our allies and our own troops and were vital to winning the war. Relying on foreign vessels could be dangerous, particularly if the war happened to be against one of the nations whose boats we were dependent on, since all of them would disappear at the moment hostilities began.
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