Senator John McCain submits a bill to repeal the Jones Act. What is your opinion?

by Contributor Jaime-Tetrault ‎07-09-2010 07:11 AM - edited ‎07-09-2010 07:13 AM

The Merchant Marine Act of 1920 (P.L. 66-261) is a United States Federal statute that regulates maritime commerce in U.S. waters and between U.S. ports.

Section 27, also known as the Jones Act, deals with cabotage (i.e., coastal shipping) and requires that all goods transported by water between U.S. ports be carried in U.S.-flag ships, constructed in the United States, owned by U.S. citizens, and crewed by U.S. citizens and U.S. permanent residents. The intent of the law is to support the U.S. merchant marine industry, but agricultural interests generally oppose it because, they contend, it raises the cost of shipping their goods, making them less competitive with foreign sources.  In addition, amendments to the Jones Act, known as the Cargo Preference Act (P.L. 83-644), provide permanent legislation for the transportation of waterborne cargoes in U.S.-flag vessels.

 

Senator McCain’s bill to repeal the Jones Act, S-325, states: ”Specifically, 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. This restriction only serves to raise shipping costs, thereby making U.S. farmers less competitive and increasing costs for American consumers.”

 

Since 1995 the U.S. Merchant Marine has received $1.5 billion in Military Security Program (MSP) subsidies. These funds were authorized to support the U.S. military’s complex supply lines and to support marine vessels that bring food and goods to the troops overseas.

 

A little known fact is that the American merchant marine originated when patriots captured the British schooner HMS Margretta in June of 1775. The U.S. Merchant Marine predates the U.S. Navy (1775) and the U.S. Coast Guard (1790) and has been an integral part of every war this nation has fought.  For this reason, the Jones Act generates quite a bit of emotion in the US Maritime industry, and Senator McCain’s bill puts the entire industry in question.

 

John Adams, our second president, said in his Memoirs, “No group of individuals did more for establishing our country than the American Merchant Seamen and Privateers. Their record speaks eloquently of their devotion and sacrifices.”  Will Senator McCain’s bill strengthen or hurt the US Merchant Marine?  Caterpillar Marine wants to know what you think?

Comments
by Visitor bakersj
on ‎07-12-2010 08:58 AM

Are our ports safer if Americans and Amercan ships transport cargo to/from our harbors?  In this post 9-11 world, we need to be cognizant of the risks associated with allowing anyone access to U.S. ports, and cities. Perhaps this isn't an issue, it was just a question I had.

by
on ‎07-12-2010 10:34 AM

1920 is a few years ago and maybe, a review is needed. There have been other reviews, however, the world has changed and is changing more rapidly than ever before.

The Jones Act does protect US jobs and does allow for a greater feeling of Security,however, there are costs associated with these advantages.

 

It is quite understandable that jobs and expert knowledge remain in the US, however, it does not stop other nations to take the lead in shipbuilding expertise at a lower cost.  If we close our eyes and rest on the past, the present and future may just decide for us.

Instead, 

 

I think it is healthy to open up the debate and look at facts and figures of the current world to see if the Jones Act does not need some tweaking.

by Visitor CWaap
on ‎07-13-2010 03:07 PM

The Jones Act not only supports USShipping, Shipbuilding/Repair, and Port Operations.  It also serves to ensure that the US is prepared to support our military in times of conflict.  In Senator McCain's own words, from his Commencement speech to the US Merchant Marine Academy class of 2007, "The Merchant Marine's support for United States military operations in war and peacetime is a valued contribution to the defense of our country..."  He should have reviewed those comments before submitting a bill that will, in all likelihood, make us less prepared when our country needs us most.  As Dethier mentioned above, perhaps a review is needed, but I don't believe that repealing the entire Jones Act will make the US safer or more competitive.

by Contributor Jaime-Tetrault
on ‎07-14-2010 06:58 AM

Very interesting perspectives so far.  The obvious challenge is both to national security of the United States, but also to economic and technological development.  Does protectionism prevent technological advancement - YES.  Does it protect national security - Possibly.  The argument can be made that the number of military vessels would be x 10 if the United States purchased from international builders (patrol boats, corvettes, etc.) using OTS (Off The Shelf) platforms.  However, as related to the Merchant Marine, is there any real national security benefit to protectionism?  I'm not so sure but welcome your comments.

 

We are at the apex of a major international change in US Maritime policies should the bill pass.  We need to prepare ourselves, our shipyard partners in the USA, and our shipyard partners outside the USA for this change.  Change is often good - the fear of change often holds us back from development.

About the Author
  • I joined Caterpillar in 2001 in the Extended Service Coverage (extended warranty) department of Cat Insurance (division of Cat Financial). I have always loved the water, ships, boats and the challenges of this industry and moved to Caterpillar Marine Power Systems (CMPS) in 2007. I was fortunate to be able to work at CMPS Headquarters in Hamburg, Germany for 2 years and now reside at our Marine Center of Excellence in South Carolina, USA. As the Marine Parts Manager for Cat Marine Parts I am able to work cross functionally with our regional product support teams, our extensive dealer network, customers and bring this knowledge and customer expectations to Caterpillar's incredible resources to design new and innovative product support solutions to meet our customer expectations. This gives me great pride and enjoyment to meet and exceed your expectations and promote the Cat Marine Brand.
  • In 2005, I started my career at Caterpillar as an intern in Kiel, after that I worked as a student and then a temporary employee. I finally became a permanent employee in 2008, working at the Marine World headquarters in Hamburg. Through all these years I was supporting and leading Marketing projects from various areas, including Electronic Sales Tools, Shows, Novelties etc. By May 01, 2011 my job role changed to the current one. In this position I am leading several Electronic Marketing projects such as all Marine and Oil & Gas Social Media activities.
  • After around 10 years of good time in mineral & metal industry, the destiny has guided me through BMW, ThyssenKrupp to the Caterpillar station. At the moment I'm serving as a Six Sigma Strategy Black Belt in Caterpillar Marine Power System.
  • I joined the Caterpillar Team 2007 and worked in several positions most likely in Product Support. 2008 I passed the 6 Sigma Black Belt Training and has leaded various sales and process related projects. After the certification as a 6 Sigma Black Belt I joined the CMPS Product Support Team as a Global Marketing Representative.
  • A maritime academy graduate and a 17 year employee of Caterpillar with 25 years of marine experience, currently managing the Caterpillar Marine Power System Product Support Division representing all product health, product support, parts sales and distribution development activities for Cat and MaK brand marine engines.
  • Originally from Spain, I moved to Hamburg, Germany, in 2010 to write my Master’s Thesis in Industrial Engineering. Upon its completion, I had the opportunity to join Caterpillar Marine Power Systems as an intern at their headquarters. During this period, I supported, in various capacities, sales into the Cargo and European Inland Waterways markets, as well as Offshore Wind opportunities. I am currently working as a Junior Territory Sales Manager in the Europe, Africa, Middle East and CIS Sales Team.
  • Born in Brazil, Luiz joined the Caterpillar engine team in 1998 and has worked in different positions covering marine service, product application and sales. Currently he is a Black Belt under the Caterpillar Marine group.
  • A veteran of 12.5 years Naval service, in the U.S. Naval Nuclear Propulsion Program. 3.5 years as a Marine Application and Installation Engineer at a CAT dealership. I have been working for Caterpillar Marine Power Systems since 2008. My time at Caterpillar has been spent helping to develop global emissions solutions for 3500 marine engines.
  • I am the Asia Pacific contact for marine parts marketing. With marine customers being the most mobile group, with operations spanning the entire globe, there are always new challenges and learning opportunties to engage in. Life in marine is never boring!
  • I have been involved in sales and marketing of Caterpillar marine products for almost 45 years including 10 years in the U.K. where I worked on North Sea oil and gas projects. For the past 35 years I have various roles within the marine business of Toromont Cat where I have assembled a portfolio of Caterpillar and MaK powered new construction and repower projects including ferries, Great Lakes bulk-carriers and self-unloaders, Coast Guard vessels and pleasure craft. I admit that my knowledge has come from a hands-on approach to engine sales by wearing coveralls and a hard hat rather than a business suit. I am based in Toronto and am an active member of the C.I.Mar. E. Great Lakes Branch and participate in SNAME Great Lakes/Great Rivers meetings in the U.S.
  • I ensure that our Cat global dealer network has the tools required to support our Propulsion Solutions products including our Cat Three60 Precision Control.
  • I have been at Caterpillar for nearly 31 years. All this time has been related to Diesel engines, with the first 23 years in Fuel Systems, the next 3 in the Engine Center, and the last 4 here in Hamburg, Germany, as the Worldwide Demand Manager for Marine and Petroleum MaK engines. In this role, I touch many areas, from concept to delivery, from shipyard to factory. I work with Dealers, Sales Managers, Customers, Accountants, and Order Processors, all the way to the factory floor. Those who know me know that I wouldn’t have it any other way.
  • I am a Mechanical Engineer with 17 years of experience with Caterpillar Engine Products, currently working at Caterpillar Marine Power Systems Headquarters in Hamburg, Germany. I am responsible for product support and Dealer development, and support dealers in the United Kingdom, Ireland, the Mediterranean, and the Middle East.
  • I am a 33 year employee of Caterpillar and have focused on engines my entire career. For the last 18 years I have worked in the Marine group in various capacities. Since 2004 I have been the Global Marketing Manager for the Pleasure Craft segment, managing all trade shows, advertising, events, and NPI (New Product Introduction) launches.
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