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The Jones Act to U.S THE CONTRIBUTION OF THE JONES ACT TO U.S. SECURITY Dr. Daniel Goure Executive Summary The United States has always had a special rela- and flagged or operated under the laws of the tionship to water. It is a nation founded from the United States. sea. Its interior was explored and linked to the sea via mighty rivers and waterways that pen- The greatest danger to the role and function of etrate deep into the continent’s interior. Seaborne the United States as a seafaring nation is the commerce drove the American economy for two decline of its maritime industry and merchant centuries; even today that economy is dependent marine. Commercial shipyards have made sig- on the sea to carry virtually all the $3.5 trillion nificant investments to modernize, and turn out in international trade generated annually. Mil- high-quality vessels with advanced engineering. lions of Americans have made their livings from Today, hundreds of seagoing vessels from larger the seas and national waterways. The security of container ships to tankers and barges and world- the seas, part of the global commons, has been a class deep-ocean drilling platforms are built ev- central theme of this country’s military strategy ery year. The projects keep American shipyards since the days of the Barbary pirates. in operation, employing approximately 100,000 skilled workers. Moreover, tens of thousands of From Athens and Rome to Great Britain and merchant mariners are at work every day as a the United States, the great seafaring nations consequence of the Jones Act. As a result, the na- have built strong maritime industries, merchant tion retains the means to build and repair Navy marines and navies. These three components of vessels, and provide critical sea lift for seapower are interrelated. A maritime industry the military. is vital to the ability to build ships, including naval vessels. The merchant marine is what car- Ninety years after it became law, the Jones Act ries goods to and from this country in both peace continues to be vital to national security needs. and war. A strong Navy secures the oceans for In the face of continuing low-cost subsidized for- U.S. seaborne trade and access but is dependent eign competition, real world economics would on the industrial base to produce new vessels dictate that the U.S. shipbuilding industry would and repair existing ones. decline. Without the Jones Act, the United States would face the danger of a rapid decline in its The importance of a national maritime industry merchant marine fleet. It would then be required and merchant marine was recognized in law to provide massive subsidies to that industry, as far back as 1920 when Congress passed pay exorbitant prices for naval vessels and rely Section 27 of the Merchant Marine Act, also on foreign-owned or flagged vessels to carry known as the “Jones Act.” Only vessels conform- critical military cargoes or to build and maintain ing to the provisions of the Jones Act are permit- at great expense a unique, government owned ted to carry passengers or cargo between two fleet of cargo vessels. Finally, because Jones Act U.S. ports, a process also termed “cabotage.” vessels must conform to U.S. laws and have U.S. All officers and 75 percent of the crews of vessels crews, waterborne transportation is reliable and engaged in cabotage must be U.S. citizens, with the homeland is more secure. the remainder being citizens or lawfully admitted aliens. These vessels must be built The report was written by Dr. Daniel Goure of in the United States, owned by U.S. citizens, the Lexington Institute. table of contents America’s Unique Relationship With Water .................. 1 U.S. Naval Power at Risk ................................................ 11 International Commerce, National Security The Jones Act .................................................................... 13 and the Global Commons ................................................. 3 Sustaining U.S. National Security: The Navy and U.S. National Security ............................. 5 The Role of The Jones Act ............................................... 15 Military Sealift and Commercial Support to The Jones Act and Domestic Security ........................... 17 Overseas Deployments ...................................................... 7 The Jones Act Needs to be Preserved Maintaining a Robust Navy and and Enforced ..................................................................... 19 Merchant Marine ................................................................ 9 America’s Unique Relationship with Water The United States of America has a unique and the Commonwealth of Puerto Rico in the relationship with water. It is a nation founded Caribbean. Finally, there is the Guantanamo from the sea by taking advantage of the Bay Naval Base on the island of Cuba. continent’s many natural harbors and access to inland waterways such as the Chesapeake America’s inland waterways directed the ex- Bay, the Great Lakes and the Mississippi River. pansion of the nation westward, helped to knit Coastal areas are home to a wealth of natu- together the different parts of the country and ral and economic resources and are the most is today a major avenue for national and inter- developed areas in the nation. These areas national commerce. The inland waterways of comprise 17 percent of the contiguous U.S. land the United States encompass over 25,000 miles area but serve as home to more than half of the of navigable waters, including the Intracoastal nation’s population. As a nation that extends Waterway, a 3,000-mile waterway along the “from sea to shining sea,” America benefits Atlantic and Gulf Coasts. This liquid highway from the protection offered by two great oceans touches most of America’s major eastern cit- as well as the opportunities to be the bridge ies including Washington DC, Philadelphia, between Asia and Europe. Baltimore, Chicago, New Orleans and Mobile. Inland and intracoastal waterways directly As the 2010 National Security Strategy ob- serve 38 states from the nation’s heartland to served, “America . is dependent upon over- the Atlantic seaboard, Gulf Coast and Pacific seas markets to sell its exports and maintain Northwest. The inland waterways allow the access to scarce commodities and resources.”1 movement of approximately 630 million tons It is impossible to overestimate the economic of cargo valued at over $73 billion annually. By value of sea-based commerce. Seaborne com- using waterborne transportation, shippers save merce drove the American economy for two around $10 per ton over the cost of shipping by centuries; even today that economy is depen- alternative modes resulting in $7 billion annual dent on the sea to carry virtually all the physi- savings nationwide. cal components of the $3.5 trillion in U.S. inter- national trade generated annually. Hundreds of Geography made it all but inevitable that billions more is generated by economic activity the United States would be a naval power. A in U.S. waters including mineral extraction combination of mercantile and security inter- (notably oil), fishing, inland and coastal cargo ests dictated that the U.S. Navy would need to movement and tourism. Millions of Americans project power not only to close-in waters but make their livings from the seas and national around the globe. The global presence of robust waterways. naval force is the principal reason that the United States remains the only nation able to The United States is also unique as a political project and sustain large-scale operations over union with significant non-contiguous con- extended distances. stituent elements separated from the continent by the water. There are two important states, Hawaii and Alaska. There are territories such as Guam, American Samoa and the Northern Marianas in the Pacific and the Virgin Islands 1 . as other powers rise and as non-state actors become more powerful, U.S. interests in, and assured access to, the global commons will take on added importance. The global commons are domains or areas that no one state controls but on which all rely. They constitute the connective tissue of the international system. Global security and prosperity are contingent on the free flow of goods shipped by air or sea, as well as infor- mation transmitted under the ocean or through space. Department of Defense, Quadrennial Defense Review Report, February 2010, p. 8 Barbours Cut Container Terminal (Port of Houston photo). International Commerce, National Security and the Global Commons American economic and security interests are The United States has been centrally respon- by no means limited to close-in waters or to its sible for creating and maintaining the global rivers and inland waterways. As the world’s commons. “Since the end of World War II, and largest economy and foremost military power, especially since the end of the Cold War, the the United States has a singular interest in the openness and stability of the global commons maritime domain -- that combination of oceans, have been protected and sustained by U.S. seas, bays, estuaries, islands, coastal areas, lit- military dominance and political leadership. torals, and the airspace above them that car- The U.S. Navy and Coast Guard have dis- ries more than 90 percent of the world’s trade suaded naval aggression and fought piracy and near which some 60 percent of the world’s around the world, ensuring unprecedented population lives.2 Half of all the oil and natural freedom of the seas.”3 The significance of the gas produced annually is transported by sea global commons has increased as a globalized or through pipelines that travel under water. economic order has emerged. Consequently, it Much of this vital flow must transit narrow is increasingly important that the global com- chokepoints such as the Straits of Hormuz, mons be rendered secure against a wide range Straits of Malacca and the Suez Canal. The of threats. United States maintains an extensive network of allies, partner nations and military installa- The ability of the U.S.
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