One unpleasant discovery for many Americans during 2021 has been the woeful state of the country’s ports, which have struggled to accommodate a deluge of demand for imported goods. To address these shortcomings, the Biden administration and much of Congress have—to the surprise of only the grossly naïve—largely centered their efforts around increased spending.
Included in the Infrastructure Investment and Jobs Act passed last month was $17.1 billion for ports, of which more than $11.5 billion will be focused on new construction. That money, one article says, “appears set to literally reshape ports in the years ahead with projects on the docket like dredging to allow bigger boats to enter or allow more boats to dock at once.”
Sen. Mike Lee (R‑Utah) has a better idea of how to help the country’s ports meet their dredging needs: remove outdated protectionism. Earlier this week Lee introduced four bills that would either reform or repeal the Foreign Dredge Act.
Passed in 1906, the Foreign Dredge Act restricts domestic dredging—the removal of sediment and debris from bodies of water (such as to deepen them to accommodate larger vessels)—to vessels that are U.S.-registered, U.S.-built and mostly U.S. owned and crewed. Shielding U.S. dredging firms from foreign competition means Americans must rely on a domestic fleet that is small, old, and expensive. The results range from costly coastal restoration projects to the less efficient operation of key ports and waterways.
Two bills proposed by Sen. Lee would address the Foreign Dredge Act in the most straightforward way: repealing it. The Port Modernization and Supply Chain Protection Act would repeal the law to permit foreign vessels to engage in domestic dredging while the Dredging to Ensure the Empowerment of Ports (DEEP) Act would combine repeal with a revamp of certain regulatory requirements under the Clean Water Act that are enforced by the U.S. Army Corps of Engineers.
The Incentivizing the Expansion of U.S. Ports Act, meanwhile, would eliminate the Foreign Dredge Act’s onerous U.S.-built requirement. Allowing Americans access to foreign-built dredgers for domestic use would reduce the cost of acquiring such vessels, thus promoting the modernization and increased efficiency of the U.S. fleet. In truth, the few U.S. dredgers delivered by U.S. shipyards are in many ways already foreign-built.
A dredging vessel currently being assembled in Florida, for example, was designed by Dutch firm Royal IHC, which is also supplying much of the vessel’s equipment. As the company states:
[T]he R.B. WEEKS will be equipped with Royal IHC designed and built equipment, including the complete and highly efficient dredging installation, dredging automation and instrumentation, propulsion and main electrical system.
During the past year those key components have been manufactured, assembled and shop tested in workshops all over the world. Part of the equipment package (35 sea containers and the suction inlet section) have been sent in 6 separate shipments to the USA already.
As this example shows, notions that the U.S.-built requirement affords the United States a shipbuilding capability free of foreign reliance are entirely illusory. What the requirement does achieve, however, is vessels with higher price tags than those constructed in foreign shipyards.
Perhaps the most intriguing bill offered by Sen. Lee, however, is the Allied Partnership and Port Modernization Act. This piece of legislation would permit the operation of foreign dredgers in the United States provided they are registered in NATO member countries, owned and operated by entities incorporated in NATO countries, and built in a country that is a NATO or a major non-NATO ally (which includes leading shipbuilding countries Japan and South Korea).
By limiting dredging activities to such vessels, the bill would grant Americans access to some of the world’s largest and most efficient dredging firms based in Belgium and the Netherlands while seeking to allay national security concerns (assuming, of course, that concerns about foreign dredge operators operating in U.S. waters are genuine rather an excuse for competition avoidance).
As the United States begins the effort to improve its ports and waterways, the dispensing of taxpayer dollars should be accompanied—ideally, preceded—by policy optimization to ensure such expenditures achieve maximum bang for the buck. Sen. Lee’s bills provide an array of options in this regard to boost the efficiency of domestic dredging. The Utah senator’s proposed path, however, requires confronting the special interests that fight tooth and nail to preserve such protectionist measures.
Does Congress have the requisite fortitude for such a battle? History suggests not, but Sen. Lee should be applauded for putting these bills forward and setting the stage for a debate about the merits of this outdated protectionism. It is certainly one worth having.