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Eno Transportation Weekly

House Subcommittee Looks at Jones Act Fleet Issues

January 19, 2018

“Why do U.S. officials want to get rid of the Jones Act?”

Chairman Duncan Hunter (R-CA) of the House Subcommittee on Coast Guard and Maritime Transportation proposed the question at a January 17 subcommittee hearing as the panelists before him pleaded for more support of the law, which requires that goods shipped between U.S. ports be carried on ships that were U.S.-built-and-owned, U.S.-flagged, and crewed by U.S. citizens or permanent residents. (See ETW’s explainer for the Jones Act and Puerto Rico from last fall here.)

The January 17 hearing revolved around concerns raised regarding the Jones Act, ranging from national security to retention and expansion of American jobs.

The hearing featured two panelists of the following witnesses (written testimony is hyperlinked):

Panel 1:

Panel 2:

  • Matt Woodruff, Chairman, American Maritime Partnership
  • Eric Ebeling, President and Chief Executive Officer, American Roll-On Roll-Off Carrier – On behalf of USA Maritime
  • Aaron Smith, President and Chief Executive Officer, Offshore Marine Service Association
  • Matthew Paxton, President, Shipbuilders Council of America
  • Bill Van Loo, Secretary Treasurer, Marine Engineers’ Beneficial Association – On behalf of American Maritime Officers, Masters, Mates and, Pilots, and The Seafarers International Union

Chairman Hunter opened by discussing his concerns with the quantity of Jones Act- eligible vessels there are only 82 vessels active in international commerce, down from 850 vessels 35 years ago. He went on to explain the goal of having American-made, staffed, owned, and flagged vessels for ready availability in times of crisis. Because these vessels are entirely American, they are accessible for cargo in wartime.

The chairman questioned the first panel to ask how quickly these vessels can prepare in such a time of crisis. Admiral Buzby explained that Ready Reserve Force readiness is at 98%, meaning that those ships can be readied within a five-day timeline for active duty. Admiral Buzby explained that as these ships get older, this timeline slows; but it takes several months to fully check the functional status of one ship.

The conversation shifted to the importance of maintaining these ships as U.S.-flagged ships, for both American job maintenance and national security. Congressman Garrett Graves (R-LA) reiterated the traditional concern behind cabotage laws – that if ships are operating in American waters and are somehow staffed by citizens of hostile nations, it presents a major danger to US national security. Admiral Nadeau of the Coast Guard explained the unlikelihood of this because of the endorsements vessels and mariners must receive, but he couldn’t entirely rule out the possibility. Ranking member John Garamendi (D-CA) also argued that Russian Parliament just passed legislation comparable to the US Jones Act, to which chairman Hunter argued that the majority of nations with major waterways have some sort of equivalent regulation to protect their own national security.

As for American jobs, by enforcing the regulations of the Jones Act, panelists argued that there will be jobs at all stages of enforcement. Not only would there be jobs for those staffing the vessels, but those who build the American-made ships as well.

The second panel prioritized the lack of enforcement of the Jones Act during their testimonies. Each of the panelists in their opening statements explained that the Jones Act is pivotal to the success of the American maritime industry, but they alleged that the government is currently not doing enough to enforce it. On the contrary, the government allows foreign ships to take priority over those few left that meet the Jones Act qualifications.

With those testimonies in hand, chairman Hunter responded by asking, “Why do we (the US government) give foreign interest preferential treatment over Americans?”

To which, the panelists and Members came to a consensus that a lack of education is the biggest issue for those in charge of enforcing the Act.

Chairman Hunter closed the discussion of the Jones Act by saying that it is essential to our maritime success, and that as experts the primary goal should continue to be education to combat the stigmas around the objectives of the Act as a whole.

 

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