Thoughts on the Jones Act

From Grassroot Institute  February 10, 2017

For many years, the Grassroot Institute has been at the forefront of organizations calling for Jones Act reform. Until recently, it has been a fairly lonely place to be. However, as interest in the economic effect of the Act has increased (especially due to the economic crisis in Puerto Rico), we find ourselves with new allies.

The objections to reform, however, remain the same. The most powerful political opponents to reform are the unions, with some help from the trial lawyers. The unions are bound to fight any threat to union interests -- here the shipyard workers and seamen whose jobs are protected by the Act. The lawyers aren't directly affected by the cabotage provisions that reformers seek to change, but worry about a contagious effect on the provision of the Act that allows seamen to bring personal injury suits against ship owners.

If union interests and lawsuits were the only arguments in favor of the Jones Act, it might have been possible to modernize it years ago. Those are the lobbyists defending the antiquated Act, but its most powerful PR argument is based in national defense. The Jones Act, we are told, ensures shipbuilding capabilities and a strong merchant marine, both of which are vital to our national interest.

You can cite the failure of the Act to promote shipbuilding and the declining merchant fleet repeatedly. You can point to the shuttering of shipyards and their paltry production levels. But as long as the "national interest" argument holds water, reform will be an uphill climb.

But what if there were ways to preserve that interest outside of the Jones Act?

The Maritime Security Program, expanded by the National Defense Authorization Act of 2003, requires the Secretaries of Transportation and Defense to establish a fleet of 60 privately-owned, commercially viable, and militarily useful active ships to meet national defense requirements. Members of this program must make their ships available during national emergencies and times of war.

It's true that this program only addresses part of the Jones Act's concern regarding the merchant marine, but that doesn't have to be the case. If it is possible to address the national security concerns of the Jones Act through other, more efficient and effective legislation, then we might clear the path to modernizing the Act.

E hana kakou (Let's work together!),

Keli'i Akina, Ph.D., President/CEO Grassroot Institute