Biden Administration Affirms Support for Protectionist Jones Act, Throwing Hawaiians, Puerto Ricans to the Sharks
President Joe Biden may have said on the campaign trail that Puerto Rico should become a state, but that doesn’t mean he supports laws that make it a viable, economically competitive state if doing so means angering maritime unions.
In an executive order signed Monday and in subsequent comments, Biden made it abundantly clear that he supports the Jones Act, a 1920 federal law that requires that cargo ships traveling between American ports be made in America and owned and crewed by American citizens:
The executive action I am taking also reiterates my strong support for the Jones Act and American vessels, you know, and our ports, especially those important for America’s clean energy future and the development of offshore renewable energy.
The Jones Act is an absolutely terrible law, designed purely for protectionist measures, that shields maritime companies and unions in the United States from competition. The consequence of the Jones Act is that a foreign commerce ship that goes to states like Hawaii or Alaska or to territories like Puerto Rico can stop in only one consecutive American port. It cannot travel to other American ports unless it goes to a foreign port and then returns. A vessel from Japan that’s heading to Los Angeles cannot also stop in Hawaii along the way and engage in commerce, despite the logical economic efficiencies in doing so.
Supporters of the Jones Act insist that these protections are necessary to sustain American jobs and to maintain a viable shipping industry. But those arguments are not supported by the data. In reality, as researchers with the Cato Institute have found, American shipyards have been in a long decline as a result, and most of the ships we build are almost entirely for use in our own waters. It’s cheaper to build large vessels overseas than in America, but since they cannot operate in America due to the Jones Act’s requirement, U.S. shipping companies can’t buy them.
The end result for the shipping industry has been completely backward. America produces fewer ships, by weight, than much smaller countries like
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