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The Jones Act also hurts the environment

Discussion in 'Energy, Environment, and Policy' started by mblakele, Oct 5, 2017.

  1. mblakele

    mblakele radial cross member

    Joined:
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    The Jones Act has been in the news a little bit of late, because of its impact on early attempts to respond to the situation in Puerto Rico. I'm posting this under Energy, Environment, and Policy because it also turns out that the Jones Act hurts the environment. By making commercial shipping more expensive, it encourages use of land-based transportation. According to the article results in more CO2 emissions.

    At the same time I think the difference may be overstated: the sources I looked at say the difference is at worst 15x between modern ships and modern trucks — not 145x. Perhaps they're comparing the oldest, worst semis with the newest, most efficient ships. Even with air freight I "only" see a 50x difference (source: CO2 emissions for shipping of goods | Time for change).

    Anyway here's the article, plus a few key quotes.

    How protectionism sank America’s entire merchant fleet

    The Jones Act hurts American consumers and destroyed the country’s shipping industry

    https://www.economist.com/news/finance-and-economics/21730034-jones-act-hurts-american-consumers-and-destroyed-countrys-shipping

    America’s shipping fleet, 17% of the global total in 1960, accounts for just 0.4% today.

    Blame a 1920 law known as the Jones Act, which decrees that trade between domestic ports be carried by American-flagged and -built ships, at least 75% owned and crewed by American citizens.

    ...

    Like most forms of protectionism, the Jones Act hits consumers hard. A lack of foreign competition drives up the cost of coastal transport. Building a cargo ship in America can cost five times as much as in China or Korea, says Basil Karatzas, a shipping consultant. And the cost of operating an American-flagged and -crewed vessel is double that of foreign ones, reckons America’s Department of Transportation.

    Inflated sea-freight rates push most cargo onto lorries, trains and aircraft, even though these are pricier and produce up to 145 times as many carbon emissions. So whereas 40% of Europe’s domestic freight goes by sea, just 2% does in America. Lacking overland routes, Alaska, Guam, Hawaii and Puerto Rico are hardest hit. Hawaiian cattle ranchers, for instance, regularly fly their animals to mainland America. A recent report by the Government Development Bank for Puerto Rico found that the Jones Act inflated transport costs for imports to twice the level of nearby islands.
     

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