The Antiquated Law That Deserves To Be Scuttled

When inflation was running high a year or so ago, there was a lot of discussion of specific ways government could help bring down prices. One idea: scrapping the 100-year-old Jones Act, which was passed way back in the 1920s as a way to spur U.S. shipbuilding, protect national interests, generate jobs, etc. Its key provision: “…goods shipped between U.S. ports [must] be transported on ships that are built, owned, and operated by United States citizens or permanent residents.” (RELATED: Inflation Cools – But Workers Continue To Lose Ground)

What the Jones Act has done over the last century is preside over the sure, steady decline of the U.S. merchant fleet and driven shipping costs through the roof. That's what protectionism does. And the band of inflation fighters pressed their case to repeal the Jones Act because such an action would immediately introduce competition among carriers, which would lead to lower prices and…yes, lower inflation.

The Jones Act survived the inflation spike. After all, a government program or subsidy, once created, is nearly impossible to kill. (RELATED: Both Republicans And Democrats Ignore Primary Cause Behind Grocery Store Inflation)

But as the Cato Institute's Colin Grabow writes, that hasn't diminished the case for Jones Act repeal. Grabow notes an example of how the Act has made building a ship in the U.S. comically expensive compared to those made by our allies abroad. The story begins with a new, U.S.-built ship, the Janet Marie. She was quite an expensive project, especially compared to her sister ship:

Although the exact figure has not been published, its George III sister ship—a vessel delivered last year with the exact same specifications—was revealed to cost “$225 million‐​plus.” It's a safe bet Janet Marie did not cost less. In comparison, two similarly‐​sized containerships were ordered from a South Korean shipyard in 2021 for $41 million each. The vast difference ($184 million) is no anomaly, comporting with previous assessments from maritime industry observers that U.S.-built cargo ships are five times the price of those constructed abroad.

There's also the amount of time it took to build Janet Marie:

From the time steel was cut until the ship's delivery was approximately 50 months. In contrast, the Ever Alot—one of the largest containerships in the world with a cargo capacity nearly 10 times that of the Janet Marie (and a price tag $80 million lower)—required just 19 months to build. Originally slated for delivery in the third quarter of 2020, the Janet Marie is a full three years late.

Overpriced and late – a symbol for everything that's wrong with the Jones Act. But what's worse, Janet Marie may be the last U.S, ship built for some time:

…with the Janet Marie now delivered there are currently no merchant ships under construction in the United States (there are, however, three containerships on the order book slated for delivery in 2026 and 2027 at the astounding price of $333 million each).

Costly, late and with little to show for any of it. That's the Jones Act, a protectionist zombie of a law that deserves to be scuttled.

The opinions expressed in this article are those of the author and do not necessarily reflect the positions of American Liberty News.

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