When a protectionist law is enacted and nearly a century later it is inhibiting a recovery from major ecological catastrophe, it’s probably time to scrap it or at least temporarily waive it.
But instead a nearly century old provision known as the Jones Act of 1920 is wielding the wrath of unintended consequences. According to the Heritage Foundation, this protectionist measure was put in place to defend the American maritime industry, but is endangering far more jobs than it is protecting.
“The Jones Act, which is supposedly about protecting jobs, is actually killing jobs,” Heritage co-authors James Dean and Claude Berube wrote in a June 8 The Foundry post. “The jobs of fishermen, people working in tourism and others who live along the Gulf Coast and earn a living there are being severely impacted. There are also additional private sector jobs which are NOT being created in the United States since the Jones Act effectively prices U.S. based companies out of the ability to be competitive on the competitive global market. As we strive to develop new technologies for a cleaner environment at sea, the Jones Act continues to hobble our own capabilities, sometimes with devastating results.”
And CNBC’s Rick Santelli also noted this impediment to recovery. According to the Belgian newspaper De Standaard, European firms could complete the task in four months, rather than an estimated nine months if done only by the U.S., and just three months if working with U.S. firms.
“They are playing this war of words,” Santelli said on CNBC’s June 9 “Closing Bell.” “Just consider this, there’s an old law on the books Ron, called the Jones Act of 1920. I’ve looked at three articles in a Belgian newspaper. They have special ships that could make a big difference in cleaning this up. But they were told by the State Department that they can’t because that act, Jones of 1920 prohibits ships that aren’t made in the U.S. to do such things in U.S. waters.”
And Dean and Berube suggest the law should be done away with altogether.
“The Jones Act needs to be waived now in light of this catastrophe and permit those whom we have helped and cooperated with in the past to assist us in our need,” they wrote. “After waiving the Jones Act for the Gulf clean up effort, Congress and the administration should repealing it all together.”