Virtually every argument against the Jones Act is falsely premised on the notion that it increases consumer prices and that it impeded emergency supplies from getting to Puerto Rico after last year’s hurricanes. Some have even argued that Puerto Rico’s decade long recession is the fault of the Jones Act — despite the fact that it was enacted almost 100 years ago. Simply stated, there is no factual evidence to support these claims.
The Jones Act, or more precisely, the “Merchant Marine Act of 1920,” simply requires goods shipped between two or more U.S. ports to be shipped on vessels that are American built, owned and crewed. But it does not prohibit foreign vessels from bringing goods to a U.S. port.
Because of the Jones Act, foreign flagged ships with unknown and unvetted foreign crews cannot deliver goods to New Orleans and then sail up the Mississippi River deep into the American heartland. We would have no way to know if terrorists or other bad actors — maybe Chinese or Russian spies — had infiltrated the crew. Imagine the resources required to protect almost 100,000 miles of inland waterways! How could the U.S. ever hope to have any border security if we make every mile of shoreline on both sides of every inland waterway an entry point? The costs would be staggering.
Another benefit of the Jones Act is that it insures that the U.S. will have enough ship building and ship repairing capability to support our U.S. Navy. It was enacted to insure that we are not forced at some future date to have our Navy’s ships built or repaired by foreign nations.
It is noteworthy, that our military supports the Jones Act as vital to our nation’s national security. The Vice Chairman of the Joint Chiefs of Staff, General Paul J. Selva, explains, “I am an ardent supporter of the Jones Act. It supports a viable ship building industry, cuts costs and produces 2,500 qualified mariners. Why would I tamper with that?” Good question, but one Jones Act detractors never seriously address!
Claims that Puerto Rico’s hurricane recovery was impeded by the Jones Act are silly. Within hours after the hurricane and once the port had reopened, Jones Act vessels were unloading vital cargoes — including food, water, medicine, fuel, and other relief cargo. In fact so much relief was delivered that the port lacked space to store it all. The biggest challenge was distributing the relief goods from the port throughout the island because of damaged roadways, electrical and communication outages, and trucker shortages. But that cannot be blamed on the Jones Act.
Those who claim that the Jones Act increases costs — aside from making this claim without any reliable evidence — also miss the point that if the military were to build, maintain and man its own cargo ship fleet for carrying all the supplies that our troops need around the world, it would cost $65 billion, plus additional annual costs for crews, operations and maintenance. Where is that money supposed to come from?
But let’s get back to the tired argument that the Jones Act increases shipping costs and the price of consumer goods. A recent study conducted by Reeve & Associates and Estudios Tecnicos, Inc. concluded that the Jones Act has no harmful impact on either retail prices or the cost of living in Puerto Rico. Shipping rates to Puerto Rico, where the Jones Act applies, were lower or very similar to the shipping rates to other neighboring islands that are not covered by the Jones Act. Additionally, foreign vessels can deliver goods directly to Puerto Rico and 57 percent of San Juan’s port traffic in 2016 was from foreign vessels. A U.S. Government Accountability Office study also concluded that there was no reliable data to support the claims of increased costs.
Frontiers of Freedom, the organization that I head, conducted its own study on consumer prices. We priced a “basket of consumer goods” (food items, toiletries, cleaning products, etc.) in Miami, Fla., and Houston, Texas and compared them to the prices in San Juan, Puerto Rico. The cost in Puerto Rico was not higher. In fact, some items were cheaper in Puerto Rico despite being shipped from the U.S. mainland.
Because the evidence is overwhelming, detractors have recently or at least temporarily moved on to other novel and frivolous arguments. For example, some argue that traffic jams in American cities are partly to blame on the Jones Act. Now they are claiming that the Jones Act adversely impacts rural Alaska. What’s next? That teen pregnancy rates are also to be blamed on the Jones Act?
Sadly, we will continue to hear the uninformed and misinformed, as well as those with a political ax to grind, make false arguments maligning the Jones Act. But what you will not hear from them are real facts, real studies, real data or even a serious discussion of the numerous benefits of the Jones Act.
The Jones Act works for America. It keeps the homeland safe, insures that we have a ship building industry to support our military, and supports good paying jobs for Americans.
George Landrith is the President of Frontiers of Freedom, an public policy think tank with a mission to promote peace through strength and free enterprise.