Biden Administration Affirms Support for Protectionist Jones Act, Throwing Hawaiians, Puerto Ricans to the Sharks

“Biden made it abundantly clear that he supports the Jones Act, a 1920 federal law that requires that cargo ships traveling between American ports be made in America and owned and crewed by American citizens”

“The Jones Act is an absolutely terrible law, designed purely for protectionist measures, that shields maritime companies and unions in the United States from competition. The consequence of the Jones Act is that a foreign commerce ship that goes to states like Hawaii or Alaska or to territories like Puerto Rico can engage in domestic trade in only one American port. It can travel to other American ports but cannot take on or deliver goods unless it goes to a foreign port and then returns. A vessel from Japan that’s heading to Los Angeles cannot also stop in Hawaii along the way and engage in commerce, despite the logical economic efficiencies in doing so.”

“The end result of this restrictive law is that only two percent of U.S. freight is transported by sea, despite our long coasts, our many ports, and island states and territories. It’s in part why we have to depend so much on trucks and trains for transporting goods, even along coastal regions. Cato notes that internal shipping is about half the volume it was in 1960, while rail and truck commerce both saw dramatic increases.

Nowhere are the burdens of the Jones Act more apparent than in places like Hawaii and Puerto Rico. These restrictions distort market forces and significantly drive up the costs to transport goods to these places. The New York Fed calculated that it can cost twice as much to ship something from the American mainland to Puerto Rico as it does to nearby island nations like Jamaica. Puerto Rico actually imports jet fuel from other countries rather than the Gulf Coast because it’s just too expensive to get Jones Act-compliant vessels.

There’s no need to exaggerate the impact of the Jones Act on domestic transport costs because whenever a disaster comes around, like Hurricane Maria in Puerto Rico in 2017, the government will temporarily waive the Jones Act’s requirements so that the costs of recovery aren’t quite as back-breaking.”

“”Among the obstacles to Jones Act reform is the complex web of special interests that benefit from preservation of the status quo. Among Jones Act supporters are U.S. shipbuilders, merchant mariners, various maritime unions, and those who actually believe the law is essential to national security.””

US Navy needs to have more than 500 ships by 2045 to have edge against China and Russia

“The Navy wants to double its number of submarines as part of a modernization plan to build more than 500 ships by 2045 to maintain a competitive edge against other naval powers such as China and Russia, Defense Secretary Mark Esper said”

“Esper said the need to modernize the Navy is in part due to China’s own naval modernization and shipbuilding efforts. The Pentagon’s China report released Sept. 1 determined the country aims to have a “world-class” military on par with the United States by 2049. It already has the largest navy in the world at 350 ships. The United States now has 296 deployable battle force ships, according to the Navy.”

“The first priority of that plan is to have a large number of attack submarines, with a target of 70 to 80 submarines overall. This will require the Navy to build at least three next generation Virginia-class submarines every year “as soon as possible,” Esper said. The Navy now has more than 40 operational attack submarines, according to Pentagon documents.”

“Large nuclear-powered aircraft carriers also will be part of the future Navy, still considered the force’s “most visible deterrent,” he said. The Navy is also looking at “light carriers,” such as the USS America amphibious assault ship that can go to sea with vertical takeoff and landing aircraft including the F-35B fighters and the MV-22 Osprey. These light carriers would free up the bigger carriers for more of the “critical high-end fight,” Esper said.”

“Unmanned naval vessels have been discussed in a number of congressional hearings about the future of the Navy and they are included in the Battle Force 2045 plan. Esper said the future force will have between 140 to 240 unmanned and “optionally manned” surface and subsurface vessels that can perform a variety of missions including surveillance, mine-laying and missile strikes.”

“Congressional help will also be necessary to make the plan work. Esper said he wants lawmakers to stop using continuing resolutions to fund the defense budget and allow the military to divest from legacy systems so that the funds can be put towards “higher priorities.” He also said he will request that the Navy have the authority to put any end-of-year budget savings towards shipbuilding instead of the losing money when it is not spent.”