USA: Senator Introduces Legislation to Repeal Jones Act

United State’s Republican, Senator John McCain, has introduced legislation that would fully repeal the Jones Act, a 1920s law that he says “hinders free trade and favours labour unions over consumers”.

The Jones Act requires that all goods shipped between waterborne ports of the United States be carried by vessels built in the United States and owned and operated by Americans. According to the senator, this restriction raises shipping costs.

“This was highlighted by a 1999 U.S. International Trade Commission economic study, which suggested that a repeal of the Jones Act would lower shipping costs by approximately 22 percent,” he said in a statement.

“Also, a 2002 economic study from the same Commission found that repealing the Jones Act would have an annual positive welfare effect of $656 million on the overall U.S. economy.”

President Obama has been criticised for not waiving the Jones Act following the BP oil disaster in the same manner former President Bush did in the Hurricane Katrina recovery. Since then, public attention has turned to the ramifications of the legislation.

“It appears that critics of the Jones Act are distorting the facts by claiming that the Jones Act applies in an instance when it simply doesn’t, or where it does, not being forthcoming with the law and the facts,” said Ken Wells, president of the Offshore Marine Service Association (OMSA).

OMSA represents US flag vessels that work in the offshore energy sector.

“Worse, they are taking advantage of this disastrous situation to undermine American workers for the benefit of foreign companies and foreign work,” the organisation claimed.


Source: baird, July 2, 2010;