Offshore InjuryBlog

All Hands on Deck: Is the Jones Act in Jeopardy?

The maritime industry is being faced with the question of "progress" concerning the supposed antiquity and restrictiveness of its mercantilist policies, as stated in the Merchant Act of 1920. The act, more commonly referred to by those in the industry as the Jones Act, is the standing law of the land governing the maritime trade and shipbuilding industry in the United States.

The Jones Act was passed by Congress in 1920 as a security for the American maritime industry. The act maintains that the United States have waterborne commerce capabilities with shipping services provided by US merchant vessels. The act also covers the matter of limited cabotage, which is the import or export of waterborne commerce to and from the United States by foreign vessels. Lastly, the act provides certain rights and protections to seamen and workers aboard said US vessels.

Historically, the Jones Act has been seen as a foundational element to American mercantilism as well as the country's involvement in international waterborne commerce. However, economists have recently been scrutinizing the act for placing far too many restrictions on the progress of international commerce and the economy as well. The Jones Act requires the United States to use domestic vessels and consequently, to maintain American shipyards. Economists claim that this has become inefficient as the use of international vessels for oil transport could significantly reduce American gas prices. Some studies even suggest that the cut in prices would be as much as a penny per gallon.

There is no easy trade-off in this situation. While the elimination of the Jones Act could potentially reduce gas prices, it would also result in the elimination of American manufactured ships—exporting that production and those jobs to a foreign country. Modern proponents of the act argue that the possibility of a slight decrease in gas prices is simply not a significant enough reason to eliminate hundreds of American jobs and export them overseas. Fortunately, many in the political and economic fields agree with this stance. The claim that eliminating the Jones Act will result in more jobs is simply unfounded as the opposite is more likely to occur given the circumstances.

The Jones Act is far too important to the survival American mercantilism and of the thousands of individual American maritime employees. At this point in the discussion, critics are clearly in the minority and the Jones Act, along with those it protects, is relatively safe.

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