Two years after first introducing Senate legislation to repeal the Jones Act, Sen. Mike Lee (R‑Utah) is back at it again. And this time he’s got company. Joining Sen. Lee in his effort to rid the country of this protectionist relic is Rep. Tom McClintock (R‑California), who is sponsoring a Jones Act repeal bill in the House of Representatives:
“Restricting trade between U.S. ports is a huge loss for American consumers and producers,” said Sen. Lee. “It is long past time to repeal the Jones Act entirely so that Alaskans, Hawaiians, and Puerto Ricans aren’t forced to pay higher prices for imported goods—and so they rapidly receive the help they need in the wake of natural disasters.”
“The Jones Act is a protectionist law that drives up the cost of commerce, and those costs ultimately fall on the consumer,” said Rep. McClintock. “Just this week, the Jones Act had to be waived to ensure the East Coast had an adequate fuel supply, much like it is often waived to respond to natural disasters in U.S. territories. The solution is not selective waivers in times of distress – it’s repealing this disastrous law altogether.”
McClintock’s decision to partner with Lee on the issue is not altogether surprising. In 2016 he called for exempting Puerto Rico from the law, and the California congressman is also a member of the Republican Study Committee which offered a FY 2017 budget calling for the Jones Act’s repeal. Beyond concerns about Puerto Rico and the country more broadly, McClintock’s opposition to the law may also be motivated by its deleterious impact on his own state.
In the energy sector alone, the Jones Act encourages California to source gasoline from as far away as Singapore and oil from Nigeria instead of domestically owing to the high cost of Jones Act shipping. The Energy Information Agency notes that within the Petroleum Administration for Defense District that includes California, a lack of Jones Act-compliant vessels “can make it difficult to move product to where it is needed.”
Raising the cost of domestic shipping also certainly isn’t doing any favors for California ports.
Unfortunately for California and the rest of the country, the Lee-McClintock bill faces slim odds of becoming law. With numerous key members of Congress as well as President Biden on record as supporting the Jones Act, the legislation almost surely won’t be passed. But perhaps it can help spark a much-needed discussion about the wisdom of maintaining the nearly 101-year-old law. The world, including the maritime industry, has changed tremendously since the Jones Act’s passage, yet the law remains nearly untouched. An actual debate over the wisdom of the law, rather than the current echo chamber of pro-Jones Act sentiment that typically prevails inside Congress, would be a refreshing change.
To learn more about the Jones Act please visit www.cato.org/jonesact.
