Grassroot Institute of Hawaii says waivers prove the Jones Act hurts the U.S. economy

 

HONOLULU, HAWAII, Sept. 21, 2017 >> This year’s disastrous hurricane season is demonstrating once again that the century-old body of shipping laws known as the Jones Act is harmful to the United States from both an economic and humanitarian perspective, according to the Grassroot Institute of Hawaii.

Keli’i Akina, Ph.D., president and CEO of the Grassroot Institute of Hawaii, noted that hurricanes in the Atlantic Ocean and Gulf of Mexico have left millions of Americans without disaster-relief supplies, which prompted the Trump Administration to grant temporary waivers from the Act.

Without the waivers, Akina said, the Jones Act would be significantly hindering essential relief efforts to the millions of hurricane victims.

That’s because the Act requires the transport of goods and passengers between U.S. ports to be on vessels built and flagged in the U.S. and crewed predominantly by Americans. This obviously limits how many ships can be deployed to disaster zones, and raises the costs for the limited few that can be deployed.

“The waivers from the Jones Act enabled more vessels to supply fuel in the face of historic demand levels,” said Akina. “This has helped save many victims.”

The latest waiver, which applied only to refined petroleum products, was initially granted by the U.S. Department of Homeland Security on Sept. 8, then extended Sept. 11; it is set to expire Sept. 22.

Initially, it applied only to New York, Pennsylvania, Texas, Louisiana, South Carolina, Georgia, Florida and Puerto Rico. On Sept. 11, more states were added, including New Jersey, Delaware, Maryland, New Mexico, Mississippi, Alabama, Arkansas, Georgia, North Carolina, Virginia and West Virginia.

“The impact of the Jones Act waivers has rippled across a nation dealing with rising fuel prices. The waivers have been a contributing factor in stabilizing fuel prices across the United States,” Akina said.

Nationwide, fuel prices rose 40 cents in the wake of Hurricane Harvey, peaking at $2.67 on Sept. 7, the day before the Jones Act waiver was put into effect.

Since then, even after hurricanes Irma, Jose and Maria piled on, fuel prices have fallen 8 cents a gallon, thanks in part to the massive refueling efforts enabled by the Jones Act waivers.

It is believed that the waivers have contributed to reducing the number of gas stations experiencing fuel outages by more than 60 percent.

In addition, the waivers have probably helped stabilize fuel prices across the nation, preventing bigger price spikes.

“The two-week Jones Act waiver demonstrates that the protectionist shipping law affects not only coastal states, but inland states as well,” Akina said. “The actions by the federal government to provide relief from this self-imposed restriction on our own economy has helped many families deal with the devastating storms.

“If relief from the law helps America’s economy during disaster situations, surely it could also help in non-disaster times as well,” said Akina. “This is further evidence that the outdated Jones Act law should be updated for the 21st century.”