The Jones Act: An Important Capability We Must Protect
By Cdr. Rich Kavanaugh (Ret), former Chief of Regional Affairs, Office of International Affairs at U.S. Coast Guard
During World War II, the U.S. Merchant Fleet consisted of 4,221 ships and there were 221 shipyards operating in the U.S. This capability allowed for the largest movement of war materials in the history of man and contributed to the liberation of Europe and the defeat of Germany and Japan. These ships, operated by U.S. merchant mariners, and owned by U.S. companies were vital to that war effort.
Today, the U.S. merchant fleet of ocean-going cargo vessels is comprised of only 186 ships, making it one of the smallest commercial fleets in the world. In addition, most of those U.S. flagged ocean-going vessels are government owned, non-commissioned U.S. Naval Ships (USNS) or Naval Auxiliary Vessels. Meanwhile the U.S. today only has 124 active ship yards producing ships that operate in U.S. waters. Most shipyards have since moved to Asia, where vessels can be produced at 1/5 the cost of a U.S. shipyard.
Most of America’s maritime capability is used for domestic transportation, transporting cargo from one U.S. port to another U.S. port. In the same way that Canadian and Mexican truck drivers are not allowed to transport cargo between U.S. destinations, foreign flagged ships are not allowed to transport cargo between U.S. ports. For shipping, this is due to a law called the Merchant Marine Act of 1920, commonly known as the Jones Act.
In contrast to our economic competitors, U.S. shipping safety regulations are typically much more stringent than those of the International Maritime Organizations and U.S. labor laws provide greater protections for U.S. merchant mariners — much better than those of the International Labor Organization. International agreements, called Port State Control MOUs dictate the manning and vessel safety standards of visiting foreign flagged vessels. These standards are minimal and most foreign ship owners don’t exceed them. Per the Jones Act, and the Merchant Marine Act at large on the other hand, American shippers must meet much more rigorous safety standards, as regulated by the United States Coast Guard on a day to day basis.
If foreign flagged vessels were allowed to conduct domestic commerce without the safety, environmental and fair labor requirements U.S. shippers abide by, they would soon eliminate the entire domestic fleet and leave taxpayers responsible for funding this capacity. Notably, we are not talking about only cargo ships, we are talking tug boats, barges, ferries, and cruise ships. Ultimately a few customers might benefit, but the rest of the country would have to stand in the gap.
The Jones Act protects our domestic transportation system, our mariner safety, ensures a living wage for the workforce, and protects our environment. Consequently, those regulations affect U.S. commercial shipping rates. It’s worth noting that when foreign vessels are required to meet U.S. standards, our shippers are quite competitive. Studies show that we often even provide a price advantage against foreign shippers in many U.S. locations.
Many therefore call the Jones Act outdated and protectionist, but as a conservative I am not an advocate of protectionism. If an industry isn’t competitive, it needs to adapt or perish. In this case, our domestic shipping industry not only is competitive under the standards that America has set, it also serves a dual role. It bolsters our military’s shipping ability and thus our country’s national security. Our nation’s capability to move when and where we need stops with the end of the U.S. shipping industry.
Ultimately the Jones Act isn’t about protecting good high paying jobs – a great goal, but it is instead about safety, protecting our environment, and ensuring a backup capability for our military.
An unlimited tonnage licensed Able Bodied Seaman in the United States requires more than 1,000 hours of oceangoing time underway to secure that certification. That is not the Captain or the First mate, that is the guy that works the deck. As a nation, we can’t rely on foreign flagged vessels using minimal certification to move our forces – our men and women in uniform deserve better. While our extensive mothballed fleet around the nation can be reactivated rapidly, we cannot grow the capability of trained, certified merchant mariners instantly if needed for a national mobilization. That capability resides in maintaining a vibrant domestic maritime transportation system.
Additionally, like the ability to produce our own steel to supply our military needs is a vital national security capability, the ability to produce our own ships is also a critical capability. The largest shipbuilding country in the world is China, our adversary. We may not be able to ramp up to China’s production levels quickly but maintaining the organic knowledge and capability is critical.
After the attack on Pearl Harbor, which could have crippled the U.S. Navy’s ability to wage war, it was the U.S. dry-docks in Hawaii and on the West coast which enabled the U.S. to mount a counterattack in early 1942. It was a domestic shipbuilding capability that allowed for that recovery. If we lose that capacity and become dependent on foreign shipyards and shipbuilders simply because they are cheaper, we lose that independence. In a dangerous world, that is a risk we shouldn’t take.
If our decisions to protect our maritime industry were based solely on what shipping customers pay in the short run, then you could say the Jones Act is outdated. However, the U.S. needs the ability to move our forces and our supplies on our own to fight when and where they are needed. Additionally, we need to be able to produce the materials, such as steel, to build ships to get there on our own. Finally, if we want to protect our domestic transportation system and the environment as well as maintain highly skilled merchant mariners, the Jones Act is the most cost-effective way to accomplish that goal.