Is it Time to De-couple the Jones Act from Shipbuilding? It’s Worth Discussing. Let Me Know

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My philosophy as a writer has been to avoid Jones Act discussions for three reasons. One? Because I think in theory, the Jones Act makes sense. Two? Because Jones Act arguments quickly deteriorate into pie fights between free market advocates and union protectionists. Three? I don’t really know the answer and of course one should never admit such a thing.

I’m bringing it up now because it is so obvious that the theory and practice have diverged. This is true to a point where:

  • The American merchant ship building industry barely exists.
  • Fully half the Jones Act merchant fleet has been flagged by Coast Guard inspectors as being in need of close safety monitoring.
  • Moreover, the merchant fleet, reserve fleet and sealift fleets no longer truly can support large-scale military operations, which Pentagon planners readily acknowledge.

What then is to be done?

Massive subsidies of ship lines and shipyards would do it of course, but there is little sign of that on the horizon. American shipbuilders are oriented toward military cost-plus type contracts, not merchant ships. And when they do build merchant ships, they are unable to reach scales that make the builds economical.

But abandoning the Jones Act would destroy any semblance of a maritime skill base in America. To serve strategic military purposes, we would need to reach out to non-US officers and crew, a more than dicey proposition.

The case for abandoning the Jones Act completely is made by those who point to lower shipping costs to Puerto Rico, Alaska and Hawaii as well as coastal energy trade from the Gulf to the Northeast.

But what about a midpoint? Foreign pilots and crew cannot be used for domestic air flights within the US. But foreign-built planes can be. This gives domestic airlines the advantage of very competitive markets for their big capital expenses.

Are we not now at a point where “foreign bottoms” can be implemented into the Jones Act, where shipbuilding is either non-existent or dubious? If the Jones Act is not stimulating new ship building, what is the purpose of the “build America” restriction.

Is it at long last time to decouple ship lines and ship building?

Really? I’m not sure. Let me know your thoughts in the comments area.

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