By Lafcadio Darling

Recently, U.S. Senator John McCain introduced the "Open America’s Water Act" which will repeal a portion of the federal Jones Act.   In the news release on the Senator's website, McCain criticized the portion of the Jones Act requiring that all goods shipped between the ports of the United States be carried by vessels built in the United States and owned and operated by Americans.  McCain states that the provision "hinders free trade and favors labor unions over consumers."  McCain's news release also argues that the Jones Act has prevented foreign vessels from assisting with cleanup operations in the Gulf of Mexico. 

In support of this bill, Senator McCain has pointed to two U.S. International Trade Commission studies (one from 1999 and the other from 2002) suggesting that repeal of the Jones Act would lower shipping costs and create a net benefit for the U.S. economy.

Assuming that Senator McCain is correct about the overall economic benefits of repealing the U.S.-flag requirement, it is unclear whether opening American ports to foreign flagged vessels would be harmful to the U.S. maritime industry, which is already hurting from current economic conditions.  Moreover, opening U.S. ports and coastwise trade to more foreign vessels may cause new environmental, safety and security problems along American coasts, since those vessels would not have to follow the rigorous and consistent regulatory framework that applies to American vessels.

As to Senator McCain's stated concerns about the Jones Act preventing foreign vessels from assisting with the BP Gulf oil leak, those concerns appears to be misplaced or exaggerated.  According to Maritime Executive Magazine, the Gulf National Incident Command reports that numerous foreign vessels are currently assisting with the Gulf cleanup and that there have been "no incidents" of foreign vessels being barred from assisting in the cleanup operation.  In fact, the massive Taiwanese skimming vessel A WHALE has, to much fanfare, arrived in the Gulf and  started skimming operations.

Since the U.S.-flag rule of the Jones Act appears on its face to help U.S. business, Senator McCain's point about the Act actually hurting the economy is interesting and worthy of debate.  However, his suggested repeal of the Jones Act does not appear to be based on the right considerations and seems to lack an adequate factual basis.

Finally, it should be noted that this proposed legislation is different from the so-called "SPILL Act" which proposes several changes to federal maritime law in the wake of the Gulf Oil disaster, including changes to the Jones Act's seaman injury provisions.  That bill has been previously discussed on this website and is moving through the legislative process in Congress. 

The text of the proposed Act can be found on the Senator's website.