“The Jones Act… the most stupid law ever”

by Walter Olson on March 1, 2014

Because of the 1920 law, backed by labor unions and U.S.-flag maritime interests, it’s infeasible to ship propane directly from Texas to the Northeast, so instead Texas ships sail to Europe and other ships sail back with propane for Northeastern customers. [Bloomberg News; earlier on road salt]

{ 9 comments }

1 Seipherd 03.01.14 at 4:48 pm

Seems a logical path to fixing Jones would make issue about the Greens (and saving energy/CO2) vs Crony unions and Crony ship owners.

However, this assumes that there is a majority of common sense politicians to be found (including some in leadership) who aren’t in the pockets of these cronies…

The fact that nothing has been done on this sort of shows how weak common sense guides political action these days — it’s all about cronyism…

Seems like those pols who get a support from one or another cause ought to step aside from voting on matters that support their donors, otherwise, they are just being bribed into supporting all sorts of nonsense. Or something…

2 Jack Frost 03.01.14 at 9:26 pm

This stupid law keeps over 400.000 Americans at work. If the law is removed all the jobs will be taken over by foreigners. And JA generates BILLIONS to USA

3 Darrell 03.02.14 at 12:23 am

Don’t be too harsh to judge the politicians from the 1920’s. It’s not as if their policies caused a major economic downturn in their immediate future is it?

4 Jack Olson 03.03.14 at 12:44 pm

Jack Frost, where do those “BILLIONS” come from? According to the Bloomberg report, consumers in New York had to pay an extra $100/tonne to get the Texas propane. Every protectionist can point out how much money his tariff supposedly generates for the USA and how many jobs this supports, never acknowledging how much this robs people who aren’t protected by tariffs and how many people lose their jobs because of it.

5 Gina 03.03.14 at 12:55 pm

So why exactly don’t Texas-based companies have ships or trucks of their own that they can transport their cargo?

6 HFB 03.03.14 at 1:57 pm

Gina,

Because the demand for the product outpaces the quantity of ships needed to transport it….in the US. Other ships are available form foreign nations so that’s where it goes only to be shipped back here. I would not be surprised at all to learn that it doesn’t even leave the ships once it reaches Europe. I could be wrong but it really seems to just wring a little more out of the consumer either way.

There have been articles here (I believe) that speak to the expense of building new ships and that, too, increases the costs.

I do not know of the motivation for creating this act back in the day. It could have been from a concern over national security or from a protectionist group, but it appears to be the motivation of the latter reason that we still have it today.

No one wants to see what benefit it would have to the US and these special interests today if we change course (pun intended) and allow the competition. It could be bad for them and good for the consumer or good for both. The “risk” is unknown and it will not ever be tried.

7 Ron Miller 03.03.14 at 4:43 pm

Jack Frost (great name, by the way), I don’t know that much about the Jones Act. But there are lot of laws we could make that would employ hundreds of thousands of people that could still be pretty foolish.

The idea of shipping something to Europe to come back here depresses me.

8 Allan 03.03.14 at 6:21 pm

Don’t we have sort of the same thing with airlines? That is, only domestic airlines may fly domestic routes and international airlines may only fly routes where reciprocal rights have been given to US airlines. Idiotic rules are not limited to the shipping industry.

9 Don 03.03.14 at 6:23 pm

Gina

Ships are the greenest method of shipping cargo. It is also the safest

They carry volumes of propane that are not realistically capable of being carried by trucks. The average propane ship carries 30,000,000 gallons of propane.

A semi truck carries 10,238 gallons of propane. That is 2,930 semi truck loads of propane, just to deliver the quantity in 1 ship.

A train might be an option. Average tank car is about 20,000 gallons. So about 1500 tanks cars of propane

A semi truck carries 10,238 gallons of propane. That is 2,930 semi truck loads of propane, just to deliver the quantity in 1 ship.

You can’t just park a huge ship like that and off load it as necessary. You have to have the storage facilities to off load and store that much propane.

Maine gets 90% of their propane by train. But they are limited by storage resources. They don’t have a port that can handle a 30,000,000 gallon delivery by ship.

New York is in a similar strait. They are trying to build a new storage facility in Finger Lakes, 88 million gallons. Safety concerns about handling Propane is delaying the project.

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