The pros and cons of The Jones Act

[@Lakridza67]

Hi from Melbourne Australia. I hope Dr Sal had a lovely holiday with the family😊🇺🇸🦘🇦🇺

[@robertlevine2152]

Having spent most of my career working with Jones Act tankers, I believe the issue is far more complicated than your discussion presented. In 1997, when ARCO Marine, Inc. contracted with Avondale Shipyard for the Endeavour Class tankers you were looking at an investment of $1.2B for five 150,000 DWT tankers to move ANS crude oil from Valdez to the US West Coast. The Endeavour Class tankers replaced three 120,000 DWT tankers and two 188,500 DWT tankers, one 90,000 DWT, two 70,000 DWT tankers, and two 265,000 DWT tankers were also retired. When the contract was signed there were two shipyards capable and willing to build the Endeavour Class Tankers, Avondale and NASSCO. Today, Avondale is no longer in existence. When the Endeavour Class tankers were being designed we were looking at a 25 year life. Structurally, based on the required USCG Critical Area Inspection Plan (CAIP), Structural Fatigue Data, Finite Element Analysis (FEA) and extensive design and model testing these ships should last for far more than 25 years. Now, based on the above description, how likely is it that there is going to be an investment in a Jones Act replacement for the Endeavour Class? How likely is it there will be a further investment in Jones Act Tankers. For the Gulf of Mexico and the East Coast tankers have to compete with tugs and barges. Now, we get into manning issues. We also get into the structural differences between tankers and tank barges. Just before I retired I had to review tank barge structural surveys prior to their hires. I was amazed at the intermittent welding in cargo and ballast tanks. I was also shocked by the fact barge ballast tanks were not necessarily coated. I don't believe that any barge I reviewed could have passed a CAIP inspection. As for MARAD, they were relevant when there were Construction Differential Subsidies (CDS). But, CDS was for US flag ships, built in US shipyards, that were engaged in foreign commerce. The CDS had to be paid back for Jones Act trade. MARAD has, I believe, looked for relevance in the form of Cargo Preference. Unfortunately, President Ford (1974 to 1977) killed Cargo Preference. I don't think Cargo Preference legislation will ever be passed and signed into law. I earned my living via the Jones Act, but I'm not sure it could be made relevant in today's world. Bob

[@shrimpkins]

Hi Bob, I'd like to know more about the pros/cons of the Act, and how you think it should be reformed; and even more importantly, what are the pragmatic considerations of the state of the US industry, and how you think the industry itself should [or could] be reformed. How can I learn more about this subject, which never seems to get the mainstream political discussion it deserves?

[@longsleevethong1457]

Following

[@robfromvan]

There are pros???!!!😮😳🥺

[@peglegpete6656]

Essentially our (US) merchant marines is not profitable. Why?

[@SuperchargedSupercharged]

That has a very long answer. You should e-mail Sal.

[@Formulabruce]

@@SuperchargedSupercharged That is a show, maybe 2 on its own if not somewhat answered already in last video.

[@Formulabruce]

So, What about Ocean going tugs/Barges? I know the US has many sort of "Stationary" Oil Barges, but wouldn't Barges be way cheaper than whole ships? Ya know The US Military could use a bunch of Oceangoing Barges, and they could double for domestic use. I know the Military have "oilers" and 2 civi tankers they use ( Merchant Marine assigned I presume)

[@Erodkp08]

How can airbus planes fly domestically??? Can someone answer?

[@wgowshipping]

There is not a US build only provisions for airliners. However, Airbus and Boeing control 91% of all airline production.

[@jimjackson1087]

The true facts are that to crew and build US ships, with our internationally non competitive labor and material rates, we would have to subsidize the industry with tax money. The only way we can avoid that is to increase the productivity of the workforce to allow the higher wages and ship building costs. Government cannot do that. A. possible solution would be some massive and long term tax benefit to our American shipping industry. That would promote private industry to invest in the means to accomplish a strong American shipping industry.

[@Ethan-hf5cg]

I'm also a fan of a tax incentive based solution.

[@42111]

Why is the audio out of sync?

[@Formulabruce]

yeah the host looked like he was on a old VHS or something...

[@wgowshipping]

Sorry, that the video from Freightwaves.

[@btaylor289]

Volume too low.

[@jeffbangkok]

Good night from the mango farm

[@4395tjh]

I'm surprised they didn't talk about how the Jones act drives up costs for people living in Alaska, Hawaii, and all other US territories. Why is this often overlooked? Isn't it time to reevaluate and reform it?

[@wgowshipping]

Using American transportation - trucks, rail and ships - drive up transportation cost in all the states, and not just for Alaska, Hawaii and PR. It would be a lot cheaper to hire truck drivers you don't have to pay minimum wage...which is what CATO advocates; but I dont.

[@4395tjh]

@@wgowshipping So much does shipping contribute to the higher costs in the aforementioned states and territories? If it does at all? Hawaii is more expensive than California after all, and besides state politics, if not for the Jones act, than what could be the explanation for the higher costs of living in the non continental states and territories?

[@Formulabruce]

@@4395tjh The Jones act was put into Law LONG before AK, and HI were event Thought of as states. You cant Drive to AK from the US and STAY in the US , so I'm sure there are supply ships to AK from Washington state. As far as gas and oil to AK, Each Resident gets a Oil "reimbursement" every year based on Oil company profits in AK. Im not 100% sure but I think Exxon brings refined oil as "Back Loads" to AK after bringing oil from Valdez to a refinery. That would be coastal, but Unsure of the ships flag.

[@4395tjh]

@@Formulabruce Thanks for the info my question though, is does the Jones act contribute to higher costs for people living in Alaska and Hawaii and other US territories? If so than what could be done to reform it? And if not then what is the main contributor to the higher cost of living for people living on those states and territories?

[@PlanetFrosty]

I’m going to call you “Jonesy Sal!” 😂, but I agree with you and you have no idea bring up fiber optic support vessels and lay down is critical. One of the largest makers of fiber optics and solid state lasers has approached me and in negotiations. A fiber facility construction could be brought to the US and deployed. Already, the lunatics coming out of the woodwork to oppose. These ships are critical, but we need more securing fiber globally from Russian and Chinese attack among other. This is $1.5 billion dollar project with the fiber and optical semiconductor facility is a $5-$8 billion dollar construction project. Then you have the new fiber laying.

[@terrymarshall3377]

You haven't even mentioned the few jobs that survive like the famous Captain Phillips incident. The American tax payer pays the cost of the give away aid shipped to a foreign country and without the Jones act we would be paying foreign crews to ship it.

[@geoffmccoll4640]

The Jons Act. what dah ? is that in the USA?

[@pierheadjump]

⚓️ Thanks team 😎 ? Reagan deregulation decimated the industry & needs to be in the discussion…. Sod busters continued to get subsidies>even for tobacco< construction & operating subsidies got ripped… when legislators & regulators had interest in foreign flag operations. The panel covered some history… WWI & WWII… but how big was the fleet during Vietnam? This discussion is not even a good start to cover how union busting & deregulation affected the industry… US owned foreign flag is where the $$$ goes. Keep trying ⚓️

[@MychelleSeymourHeyyouremember]

Too complicated. ;-).

[@geoffmccoll4640]

Does it mean you need to be better looking than Donald Trump?

[@ginog5037]

The Halifax Explosion was an accident, 9/11 wasn't...

[@PlanetFrosty]

This is exactly my point with undersea and coastal fiber optic needs for better security and updating.