Saturday, January 20, 2018
Hawai'i Free Press

Current Articles | Archives

Monday, May 08, 2017
The Jones Act and other regulations have buried the shipping industry
By Grassroot Institute @ 12:01 AM :: 1174 Views :: Jones Act

The Jones Act and other regulations have buried the shipping industry

by Kelsey Meehan Grassroot Institute, May 4, 2017

The Jones Act and other regulations have buried the shipping industry

Through his campaign rhetoric and his actions since taking office in January, President Donald Trump has come out strongly as an alleged protector of American jobs, a so-called defender of the average American worker. At the same time, his administration has positioned itself as supporting a free economy and business deregulation.

The problem is that these lofty goals don’t perfectly align, resulting in Trump protecting some American jobs at the cost of many others.

Such is the case of the Jones Act, an archaic law that has long been touted as a cornerstone of American industry — or as a model for the economic failure that results from government regulation, depending whom you ask. Trump has yet to take a public stand on this prime example of protectionist legislation, but our hope is that he would call for its elimination or reform.

The Jones Act, or the Merchant Marine Act of 1920, is a protectionist shipping law that citizens of non-contiguous states and territories are all too familiar with. Claiming to protect the U.S. shipbuilding industry and national security, the Jones Act mandates that vessels carrying cargo between U.S. ports must be built in the U.S., be 75 percent American-owned and crewed, and fly the American flag.

Such regulations might have made sense 100 years ago, when the Jones Act was enacted; the outcome of wars back then were often decided as a result of battles on the high seas — but that threat has faded and these days the morass of rules that comprise the Jones Act have become the epitome of failed regulation.

Not only does the Jones Act massively drive up shipping costs, leading to crippling consumer prices, but studies have shown that it has failed to protect the U.S. shipbuilding industry and it also does not add to U.S. national defense efforts.

Today, the U.S. has fewer shipyards than any time in the recent past. Between 2006 and 2011, the Jones Act-eligible fleet shrank by over 17 percent, indicating a failure to maintain the health of the commercial shipbuilding industry. And of that eligible fleet, old and, in some cases, rotting ships have led to the Department of Defense using foreign vessels during wartime. There is also a question of whether the Merchant Marine Sailors who operate the ships on a daily basis would have the training necessary to operate the ships in a time of war.

Still, the law persists, due in large part to the massive influence of the shipping and labor union lobbyists, who have long had their hands in the cookie jar that is Congress.

Despite their too-often-successful, self-interested pleadings, backed by the considerable campaign donations they are able to marshall, the reality is that the Jones Act is a threat to American jobs, American companies and the American economy overall.

According to a recent study on regulatory barriers in the United States by the Mercatus Center at George Mason University, restrictions on the shipping industry increased from just over 300 in 1970 to almost 8,000 by 2014, an increase of more than 2,400 percent.

That’s right: In less than a quarter of a century, the U.S. government piled more than 7,000 regulations onto just one single industry.

These regulations provide the domestic shipping industry with “protection” from foreign competitors, but they come at a massive cost, including hindering new domestic companies from entering the marketplace, and decreasing incentives for existing firms to lower their costs, negatively affecting, among other things, the ability of U.S. ship builders to compete in global markets.

In other words, the very regulations enacted in the name of “protecting” and “advancing” the American economy have been simultaneously shooting it in the foot.

The U.S. industry now is simply unable to compete in global markets, resulting in instances such as buyers in Puerto Rico, for example, importing jet fuel from companies in South America rather than sellers from within the contiguous U.S. States like Maryland and Virginia import road salt rather than buy it from sellers in Ohio, and it’s more cost-effective for American livestock farmers to purchase grain from overseas rather than from domestic sources.

Instead of protecting and advancing the interests of American workers or the American economy, the Jones Act and other shipping regulations are handcuffing American industries and raising costs for consumers.

It’s true that even if the Jones Act were repealed, or even simply reformed, thousands of shipping regulations would still exist. The shipping industry still would not be able to compete on a global level, but its condition would improve, and the likelihood would increase that the industry could, one day, finally deregulate.

In the meantime, the American economy would reap the benefits of the economic liberalization. Yes, some job loss would occur in the cabotage, repair and other service sectors, but these would be outnumbered by the employment gains in agriculture, trade, manufacturing and other sectors.

If Trump really wants to help American workers — all of them — and truly advance America’s economy, he could start by removing barriers to competition such as the Jones Act. Doing so would allow more companies to enter the shipping market, thus creating more American jobs and lowering costs for American consumers. It would go a long way toward helping America be great again.

It’s time to stop pretending that the Jones Act’s perceived benefits outweigh its crippling costs. The American people should not have to wait another hundred years for relief.

 

Links

TEXT "follow HawaiiFreePress" to 40404

Register to Vote

2aHawaii

808 Silent Majority

808 State Update AM940

ABCDEFG Blog

ACA Signups Hawaii

ACCE

ALEC

Alliance Defending Freedom

Aloha Conservative Alliance

Aloha Life Advocates

Aloha Pregnancy Care Center

American Council of Trustees and Alumni

American Mothers of Hawaii

AMVETS-Hawaii

AntiPlanner

Antonio Gramsci Reading List

A'ole Eradication

A Place for Women in Waipio

Audit The Rail

Ballotpedia Hawaii

Better Hawaii 

Blaisdell Memorial Project

Broken Trust

CAFR Hawaii

Castaway Conservative

Children's Alliance Hawaii

Children's Rights Institute

Christian Homeschoolers of Hawaii

Citizens for Recall

Cliff Slater's Second Opinion

Coffee Break

Conservative Forum for Hawaii

CSIS Pacific Forum

DAR Hawaii

DeedySupport.com

DVids Hawaii

E Hana Kakou Kelii Akina

E Māua Ola i Moku o Keawe

Farmers For Choice Hawaii

FIRE

Fix Oahu!

Follow the Money Hawaii

Frank in Hawaii

Friends of Lanai

Front Page Magazine

Frontline: The Fixers

Genetic Literacy Project

Get Off Your Butts!

God, Freedom, America

GoGoGMO!

Grassroot Institute

Habele.org

Hawaii Aganst Assisted Suicide

Hawaii Aquarium Fish Report

Hawaii Aviation Preservation Society

Hawaii Catholic TV

Hawaii Christian Coalition

Hawaii Cigar Association

Hawaii Coalition Against Legalized Gambling

Hawaii Credit Union Watch

Hawaii Crime Victims' Rights

Hawaii Crop Improvement Association

Hawaii Debt Clock

Hawaii Defending Marriage

Hawaii Defense Foundation

Hawaii Families for Educational Choice

Hawaii Family Advocates

Hawaii Family Forum

Hawaii Farmers and Ranchers United

Hawaii Farmer's Daughter

Hawaii Federation of Republican Women

Hawaii Firearm Community

Hawaii Fishermen's Alliance

Hawaii Future Project

Hawaii Gathering of Eagles

Hawaii History Blog

Hawaii Homeschool Association

Hawaii Jihadi Trial

Hawaii March for Life

Hawaii Meth Project

Hawaii Open Budget

Hawaii's Partnership for Appropriate & Compassionate Care

Hawaii Public Charter School Network

Hawaii Rifle Association

Hawaii Right to Life -- Big Island

Hawaii Right to Life -- Oahu

Hawaii Senate Informer

Hawaii Shield Law Coalition

Hawaii Shippers Council

Hawaii Smokers Alliance

Hawaii State Data Lab

Hawaii Together

Hawaii Votes

Heritage Foundation

HI Coalition Against Legalized Gambling

HIEC.Coop

Hiram Fong Papers

Homeschool Legal Defense Hawaii

Honolulu Homeless Crisis

Honolulu Navy League

Honolulu TEA Party

Honolulu Traffic

Horns of Jericho Blog

House Minority Blog

House Republican Caucus YouTube

HPACC

Hump Day Report

Hunting, Farming and Fishing Assoc.

I Vote Hawaii

If Hawaii News

Inouye-Kwock, NYT 1992

Inside the Nature Conservancy

Inverse Condemnation

Investigative Project on Terrorism

Iowa Meets Maui

Jackson v Abercrombie

Jihad Watch

Judgepedia Hawaii

July 4 in Hawaii

Kahle v New Hope

Kakaako Cares

Kau TEA Party

Kauai Co GOP

Keep Hawaii's Heroes

KeyWiki

Land and Power in Hawaii

Legislative Committee Analysis Tool

Lessons in Firearm Education

Lingle Years

Malulani Foundation

Managed Care Matters -- Hawaii

Malama Pregnancy Center of Maui

Mauna Kea Recreational Users Group

MentalIllnessPolicy.org

Middle East Forum--The Legal Project

Mililani Conservatives for Change

Military Home Educators' Network Oahu

Missile Defense Advocacy

MIS Veterans Hawaii

Muslim Brotherhood in America

NAMI Hawaii

NARTH

Natatorium.org

National Christian Foundation Hawaii

National Parents Org Hawaii

National Wind Watch

New Zeal

NFIB Hawaii News

No GMO Means No Aloha

No Hawaii Beverage Tax

Northwest Economic Policy Seminar

Not Dead Yet, Hawaii

Now What I Really Think

NRA-ILA Hawaii

Oahu Alternative Transport

ObamaCare Abortion Hawaii

OHA Lies

Ohana Policy Group

OpenHawaii.org

OurFutureHawaii.com

Pacific Aviation Museum

Patients Rights Council Hawaii

PEACE Hawaii

People vs Machine

Pritchett Cartoons 

Pro-GMO Hawaii

P.U.E.O.

RailRipoff.com

Rental by Owner Awareness Assn

Republican Party -- Hawaii State

Research Institute for Hawaii USA

Rick Hamada Show

RJ Rummel

Robotics Organizing Committee

Salvage The Rail

Save the Plastic Bag

School Choice in Hawaii

SenatorFong.com

SIFE Remington

SIFE W. Oahu

Smart About Marijuana--Hawaii

St Marianne Cope

State Budget Solutions Hawaii

State Policy Network

Statehood for Guam

Tax Foundation of Hawaii

TEA Party Maui

TFB Micronesia

The Harriet Tubman Agenda

The Long War Journal

The Real Hanabusa

Time Out Honolulu

Truth About Trade & Technology - Hawaii

UCC Truths

Union Members Know Your Rights

United Veterans Hawaii

US Tax Foundation Hawaii Info

Valor in the Pacific

VAREP Honolulu

Waagey.org

West Maui Taxpayers Association

What Natalie Thinks

Whole Life Hawaii

YAL UH Hilo 

Yes2TMT

 

 

 

Maui TEA Party
Maui TEA Party