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  • The Jones Act vs. Affordable Energy

    The Wall Street Journal recently highlighted another Washington regulation that is holding back the economy. But this one can’t be blamed on President Obama, because it was enacted over 90 years ago.

    The protectionist Jones Act requires shippers transporting goods between two points in the United States to use vessels built in the U.S., owned by U.S. companies, and manned by U.S.-based crews—even if there are more affordable transportation options available.

    The article cited one expert who said foreign-flagged ships could transport oil for less than one-third the cost of U.S.-flagged ships if not for the Jones Act. This would reduce prices and increase the availability of energy produced in states such as Texas and North Dakota that is destined for consumers in the northeast.

    The Jones Act is especially harmful to consumers in places such as Hawaii and Puerto Rico, where rail or truck transportation is not an option. For example, the Puerto Rico Electric Power Authority pays as much as 30 percent more for liquefied natural gas because of restrictions on the use of foreign-flagged ships.

    The Jones Act is an example of crony capitalism, where one group benefits from special treatment by the government at the expense of everyone else. If politicians are serious about affordable energy, they should remove government barriers to competition in the shipping industry.

    Posted in Energy [slideshow_deploy]

    6 Responses to The Jones Act vs. Affordable Energy

    1. Max Pate says:

      As a retired merchant marine officer I'm sure I'm biased. How ever while this seems to be a very good idea, it would have many unintended consiquences to our economy. First the Jones Act was instermental in the US having practely no ships now. Next traditionally, the US has pressed the merchant marine into service in national emergencies. If we have none; who are we going to use? Next we will lose more jobs, much like our manufacturing industry has had happen.

    2. Garry says:

      Us Flagged vessel fleet in 1955 = 1,072
      US Flagged vessel fleet present = 93 http://www.americanmaritime.org/merchant/
      We are loosing the battleground of the open seas.

    3. KJinAZ says:

      I have never heard of this regulation. Does this mean we can kick all of the Mexican Trucks off the road? We have hundreds of unsafe truck crossing our borders every day. This could put a stop to that.

      • Steve says:

        Nope. Repeal of the Jones act would mean hundreds of unsafe foreign vessels in our ports and along our coast lines. Want to see more oil on our Beaches, Bays, Rivers, and Harbors. Repeal the Jones Act.

        The attempt to repeal the Jones Act has been going on for over 20 years. A handful of very rich petroleum transportation company owners want to export the traditional jobs of the American Merchant Marine off to foreigners. The foreign mariners will work for peanuts and the American Mariner will go extinct,

    4. mongoose says:

      Every nation with a coastline, and more than 1 seaport, has a variation of the Jones Act. It is all about not being dependent on foreign controlled assets.
      When is the last time anyone flew a foreign air carrier from Las Vegas to Chicago? Why would we want to treat domestic shipboard transportation different than domestic airborne transportation?

    5. Mariner86 says:

      Just because John McCain thinks it bad doesn't mean it is…Would you rather have Aeroflot flying between New York and Chicago five times a day? Same idea…American ships for American cargo between American ports!!!

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