Jones Act Report Validates Value


April 2013


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Our industry got a big, well-earned boost with the recent release of a Government Accountability Office study on the Jones Act and how that law affects Puerto Rico.


To the surprise of no one who actually believes in American-flag shipping, the study shot down claims by Jones Act critics who’ve alleged the law harms consumers and costs too much. On the contrary, the GAO – an independent, non-partisan federal agency – found that the U.S. domestic container shipping fleet has provided dependable service to Puerto Rico while offering substantial rate reductions.


While the report confirmed that it’s practically impossible to measure certain aspects of the overall cost of Jones Act shipping, it clearly reflects big rate drops in recent years. And it also warns of potentially grave consequences to the U.S. Merchant Marine and American shipbuilding and national security if the law were weakened or eliminated.


If you’re new to our industry or otherwise unfamiliar with the Jones Act, it’s one of the foundations of the American maritime industry. This law mandates that cargo moving from one domestic port to another be carried on vessels that are crewed, owned, built and flagged American. It has served the United States quite well since 1920, and has enjoyed consistent bipartisan support in Congress as well as the backing of every president and the U.S. military. Dozens of other nations have similar laws – because they promote national and economic security. And some version of the Jones Act has been in effect since our nation’s founding.


Make no mistake: The individuals and organizations who attack the Jones Act aren’t interested in so-called free trade or helping consumers save a buck. They’re interested in sinking the U.S. Merchant Marine, closing U.S. shipyards, and exporting our jobs overseas.


In this time of high unemployment with Americans calling upon their government officials to change laws that have permitted jobs to go overseas, altering the Jones Act to allow foreign companies to enter the Puerto Rican-U.S. market would adversely affect both the Puerto Rican and the American economies.


The Jones Act helps sustain nearly 500,000 American jobs and generates more than $100 billion in annual economic output along with nearly $11 billion in annual tax revenue. It helps maintain a pool of U.S. citizen seafarers who are available to sail on American military support ships anywhere around the world. And, as the GAO found, it doesn’t harm consumers.


While that should add up to “case closed,” we know the attacks will keep coming. Our industry will be ready, and we’ll set the record straight as many times as needed.


Along those lines, we’re fighting to maintain the Food for Peace program, as reported elsewhere on this page. This is another pillar of the U.S. Merchant Marine, also under attack by people who do not care about maintaining American maritime jobs – or U.S. farm jobs, for that matter. When I say we’ve been working on it practically 24/7, it’s not much of an exaggeration.


This is a difficult fight, but we have strong support on both sides of the aisle and from the military. As with the Jones Act, Food for Peace helps sustain the American crews and American-flag ships that our country needs in times of conflict. It also helps our own economy and those of other nations while promoting goodwill across the globe.


At times it seems like these battles never end. For our members who have a few years behind them, these fights about the Jones Act and Food for Peace may seem like old news. Our attackers are like dogs trying to catch a car. They just won’t give up. But we are up to the challenge, and we will commit every possible resource to protecting and promoting the U.S. Merchant Marine.



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