Criticism
Critics note that the legislation results in costs for moving cargo between U.S. ports that are far higher than if such restrictions did not apply. In essence, they argue, the act is protectionism.
Critics also contend the Jones Act has caused the U.S.shipbuilding industry to build vessels in the U.S. which are more expensive than those built elsewhere. Consequently, U.S. shipbuilders are priced out of the international market for merchant ships. A 2001 U.S. Department of Commerce study indicates that U.S. shipyards build only one percent of the world's large commercial ships. Few ships are ordered from U.S. shipyards except for cabotage. U.S. operators of ships in cabotage have an economic incentive to continue operating old vessels rather than replace them with relatively high cost vessels built in the U.S. The report concluded that the lack of United States competitiveness stemmed from foreign subsidies, unfair trade practices, and lack of U.S. productivity. However, the same argument buttresses that of their opponents who state that without the Jones Act, all remaining US shipyards would be deconstructed or outsourced overseas resulting in the utter destruction of the US Maritime industry. In turn, this would result in higher costs for US Navy vessels and eventually require most Naval ships meant for national defense to be built overseas as well.
Moreover, critics point to the lack of a U.S.-flagged international shipping fleet. They claim that it is economically impossible for U.S.-flagged, -built, and -crewed ships to compete internationally with vessels built and registered in other nations with crews willing to work for wages that are a fraction of what their U.S. counterparts earn. However, the same argument is used by the Seamen Union which claims the Jones Act allows for a well paid, educated, and all American merchant mariner force.
On June 25, 2010, Senators John McCain and Jim Risch introduced the Open America's Waters Act, a bill to repeal the Jones Act. Sen. McCain said the Jones Act restricts shipping and raises costs to consumers in Hawaii, Alaska, Puerto Rico and Guam. The bill failed.
Read more about this topic: Merchant Marine Act Of 1920
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