Meanwhile, Rep. Mark Sanford, R.-S.C. asked why commercial ships in domestic trade must be built in U.S. when 30 of 46 ships in Ready Reserve Fleet are foreign built.
The head of the principal trade groups for the tug and barge and domestic shipping industry asked Congress to resist calls for changes to the Jones Act, which requires vessels engaged in domestic shipping to be built and registered in the U.S., be owned by U.S. citizens, and to employ American seafarers.
Thomas A. Allegretti, the president and chief executive officer of the American Waterways Operators and chairman of a Jones Act advocacy group called the American Maritime Partnership, asked members of the Subcommittee on Coast Guard and Maritime Transportation of the Committee on Transportation and Infrastructure to actively support the Jones Act and to “strongly oppose inclusion of measures to weaken the law and legislation that may originate in other committees.”
He said the law is critical to economic and national security and provides many good, family jobs.
Critics who say the law will help reduce the cost of gasoline or that repeal will solve Puerto Rico’s economic woes are wrong, he said.
Repeal, he contended, would destroy the American maritime industry.
In written testimony, Allegretti he wrote “Jones Act transportation costs contribute less than one-tenth of one cent to the nationwide average cost of a gallon of gasoline.”
He also called “absurd” a call by the Heritage Foundation to exempt Puerto Rico from the Jones act “the single most important step Congress can take toward enabling economic growth in Puerto Rico.”
Allegretti said he was concerned about provisions dealing with the Jones Act might be included in a Puerto Rico relief bill.
He argued Puerto Rico benefits from “the most reliable service and lowest shipping rates in the Caribbean because of the unique efficiencies built into the maritime and logistics network between the island and the U.S. mainland” and noted the investments U.S. shipping companies like Tote and Crowley are making in the trade.
But Rep. Mark Sanford, R.-S.C., said that 30 of 46 ships in the ready reserve fleet are not built in the U.S. asked if using foreign flag built was okay for the military why it was not acceptable for domestic shipping,
Sanford also cited a Government Accountability Office report that he said showed it was twice as expensive to ship containerized cargo to the Dominican Republic than to ship to Puerto Rico. He said the Puerto Rico farm bureau has aid farmers and ranchers in the commonwealth were sourcing fertilizer and animal feed from overseas instead of the United States because of high transportation costs. He also referred to a report that
shipping cargo to Hawaii from Los Angeles can be as much as 10 times
more expensive as shipping cargo from Los Angeles to China.
But Allegretti said GAO was not able to reach firm conclusions about cost differentials, saying comparisons between the cost of moving cargo on foreign flag ships and those subject to the Jones Act were an “apples to oranges” comparison in part because of societal norms in the U.S. and other countries.
Rep. Duncan Hunter, R-Calif., told Sanford that the Jones Act and cargo preference laws are “not an economic thing.”
“It’s about national security. Because when you have to start making ships and crewing those ships in times of war…you have to have U.S. crews to do that.”
U.S. shipping groups ask Congress to protect Jones Act
