Heritage questions Jones Act national security rationale

by Michael Hansen, Hawaii Shippers Council, June 14, 2016

The National Interest Magazine published on June 13, 2016, the opinion-editorial, “The Jones Act: Protecting Special Interests, Not America,” which dispels the notion that the Jones Act is integral to the national security of the U.S.

The author of the op-ed is Bryan Riley, the Jay Van Andel Senior Trade Policy Analyst in The Heritage Foundation’s Center for Trade and Economics.

The National Interest (TNI) is an American bi-monthly international affairs magazine published by the Center for the National Interest. It is associated with the realist school of foreign policy thought. It was founded in 1985 by Irving Kristol. The magazine's honorary chairman is Henry Kissinger. Dimitri K. Simes is the Publisher, and its Advisory Council was chaired by James Schlesinger until his death in 2014.

Key excerpts:

When special interest groups want goodies from Congress, they’ll often cloak their pleas in the garb of “national security.” So nearly a century ago, Congress passed the Merchant Marine Act of 1920.

Those who defend it argue that banning foreign vessels from intra-national shipping helps national security by preserving a domestic shipyard industrial base that can serve national defense purposes when the need arises.

The act gets its nickname from its author, Sen. Wesley Jones. Back in 1920, he and his allies also professed the desired to promote the national defense. But his Merchant Marine Act also had the foreseeable effect of forcing the two Canadian steamship lines serving Alaska to withdraw from the market. And the two remaining steamship lines serving Alaska just happened to be based in Senator Jones’s home state of Washington.

Recently, Rep. Gary Palmer proposed exempting another U.S. territory—Puerto Rico—from the Jones Act. Laden with $72 billion in debt, the island commonwealth faces a fiscal crisis.

And fans of the Jones Act immediately cried national defense. Are they right? Is expensive protectionism necessary to keep the U.S. shipbuilding industry from going the way of the dinosaur?

To answer that, let’s consider the shipbuilding industry relative to other manufacturers of transportation equipment. No other sector of America’s transportation infrastructure is sheltered from competition in the way the Jones Act shelters the shipbuilding industry by requiring the use of U.S.-built vessels.

For example, the United States does not ban the use of imported planes, trains, automobiles, or trucks. U.S. tariffs on imported transportation equipment other than ships and boats average just 1.2 percent.

The Jones Act is not about protecting U.S. citizens from foreign threats. It’s about protecting a politically connected industry from competition.