Wednesday, April 23, 2014

Ever Heard of the Jones Act?

It was a 1920s protectionist measure passed to appease US labor unions and American shipbuilders by not allowing foreign vessels to transport products between US cities.  Though it has long since outlived any usefulness it had (and since it restricted freedom and attacked voluntary economic behavior, you can be sure that it has had a net negative effect on the US public), the Jones Act is still the law of the land.  And as William Shughart II points out in a news article at the Independent Institute, its presence costs current US citizens millions of dollars in inflated energy costs.  From the article:
But every day the law adds to energy bills because it stops foreign-flagged tankers and barges from shipping among US ports. They can’t help move crude from Gulf Coast ports to East Coast refineries, or supply Florida with oil from Louisiana and Texas ports or ship oil between West Coast and Alaskan ports.
Without the Jones Act, in short, we’d have significantly greater domestic oil production.
Unions, of course, still want the act on the books and vigorously fight any efforts to scrap the law:
Over the years, efforts to repeal the Jones Act have been blocked by labor unions, which claim that repeal would cost thousands of shipyard and maritime jobs. The near-disappearance of the US shipbuilding industry renders that argument moot.
If Congress won’t act, President Obama could issue a blanket Jones waiver for transporting oil between US ports.
Leaving the Jones Act in full force condemns millions of Americans on the East and West Coasts to needlessly inflated energy prices, and also weakens us internationally. Rather than keep this bad law afloat, our leaders should scuttle this costly relic of the past.
 Excellent, brief article well-worth your time.