By Mark Berrios-Ayala, Esq.

The Jones Act (officially the Merchant Marine Act of 1920) is an act that every Puerto Rican should know and

understand.[1] Specifically, everyone should know how the Jones Act limits the Puerto Rican economy and closely

resembles the treatment of the Thirteen Colonies by the British. Section 27 of the Jones Act requires ships travelling

between two or more American ports (known as “cabotage” or coastwise travelling) must be built, registered, owned,

and operated by United States citizens.[2] The Jones Act also applies to Puerto Rico, which is a U.S. territory.[3]

That does not sound so bad at first, does it? When you look closely, however, the constraint on the nation’s economy

becomes much clear.

During the past several months, foreign-flagged ships carrying aid are repeatedly delayed because they must stop in

American ports like Jacksonville, have their cargo placed on an American flagged ship and then sent to Puerto Rico.

This results in millions of Puerto Ricans—United States citizens—left waiting longer for bare necessities like food and

water after Hurricane Maria’s devastation.[4] The Jones Act, the law responsible for this, was passed in 1920, right

in the wake of World War One.[5] Initially passed to protect American shipping interests, the Jones Act has hurt

Puerto Rico’s economy as well as the rest of America.[6]

The Jones Act hurts Puerto Rico because it raises shipping costs and lengthens shipping times. Current global

pricing rates to transport items by ships are at historic lows, but that is not true for American-owned vessels.[7]

American shipping costs are usually three times higher than foreign shipping costs.[8] Why? Because the Jones Act

reduces competition between competing shipping companies, thus allowing them to add increased mark-ups on the

freight costs.[9] Shipping companies also choose a shipping schedule that suits them, without considering the wants

and needs of customers like you.[10]  In fact, a group of shipping executives in Florida were convicted of conspiring

to fix freight routes from Puerto Rico to Jacksonville, which is a federal crime.[11]

The Jones Act costed Puerto Rico 537 million dollars in 2010 alone.[12] These higher costs have made electricity

costs in Puerto Rico more expensive than in forty-eight states![13] American companies in Puerto Rico routinely buy

Canadian because importing items from there is cheaper than buying American and paying the added costs of the

Jones Act.[14] The Jones Act restrictions have caused Puerto Rico to lose out on being a logistics hub for shippers

out of the Panama Canal to Jamaica, because shippers want to avoid the added costs.[15] Shipping a container from

New York to Puerto Rico typically costs about $3,000; to ship that same container to nearby Santo Domingo,

Dominican Republic costs $1,500; for an even shorter distance such as to Kingston, Jamaica, $1,600.[16] Absurdly

expensive? You be the judge.

Puerto Rico is not the only place hurt by the Jones Act, Hawaii and Alaska deal with the same problems, too.[17] The

estimated costs to ship a container from Los Angeles to Shanghai, China—6,400 miles—is $800.[18] If that same

container were going from Los Angeles to Honolulu, it would cost $8,700 on a Jones Act compliant ship, for only

travelling half the distance.[19] The Jones Act has put the last Hawaiian sugar plantation out of business because the

high shipping costs make importing sugar from Latin America cheaper.[20] Alaskan oil is more expensive than

imported oil, causing a decline in Alaskan oil tankers.[21] Foreign ships could transport oil for one-third the cost of

American ships.[22] In fact, shipping oil from, say Texas, costs about $2 a barrel, would cost up to $6 to be shipped

within the country.[23] The Jones Act failed our Armed Forces during the Gulf War when none of the 460 transport

vessels that participated during that war were American.[24] The Act was temporarily waived to allow American

vessels to be fueled in Saudi Arabia.[25]

Lastly, the Jones Act is a form of colonial repression left from the days of the American Imperialism. In 1651, the

British imposed the Navigation Act which restricted trade of most colonial goods onto English ships.[26] The

Navigation Act also required half of the crew to be English.[27] Nine years later, in 1660, the British passed a more

stringent law for all colonial trade to be on English ships as well as all imports and exports fro the colonies carried on

English ships.[28]. The Staple Act of 1663 further required that vessels bound for the colonies from Africa or Europe

stop in England first.[29]

The Jones Act requires all cabotage trade to be on American vessels. It requires the entire crew of these vessels to be

American. Ships must be owned by Americans, now mostly large conglomerate corporations whose ownership

themselves can change daily. The American ownership requirement forces Alaskan oil prices up, and forces the

power bill for Hawaiians up. Foreign vessels bound for Puerto Rico to lend aid to Hurricane Maria survivors must

first stop in ports like Houston or Jacksonville before continuing. Puerto Rico. Does this sound like the strict

regulations the British imposed to profit off the Thirteen Colonies under their rule? Yes indeed.

Every day, the Jones Act acts like a leech, sucking the life-blood out of millions of Americans in Puerto Rico, as well

as Alaska, Hawaii, and Guam. Thousands of Puerto Ricans fleeing the devastation of Hurricane Maria will be paying

sky-high shipping costs to transport their belongings to places like Florida because of the Jones Act. Foreign aid will

continue to be delayed because of the Jones Act’s vessel ownership requirement. Now is the time to end this century-

old relict of American protectionism and save three million Americans in Puerto Rico It is time to repeal the

cabotage requirement of the Jones Act.

[1] (Grennes, 2017)

[2] (Legal Information Institute, n.d.)

[3] Id.

[4] (Siddiqui, 2017)

[5] (Grennes, 2017)

[6] Id.

[7] Id. at 24.

[8] Id. at 24.

[9] See generally id.

[10] (Grennes, 2017)

[11] Id. at 25.

[12] Id. at 26.

[13] Id.

[14] Id.

[15] Id. at 27.

[16] Id.

[17] (Grennes, 2017)

[18] Id. at 27.

[19] Id. at 27–28.

[20] Id. at 28.

[21] Id.

[22] Id. at 28–29.

[23] Id. at 28.

[24] Id. at 32.

[25] Id.

[26] (Smith, 2006)

[27] Id.

[28] (Navigation Acts, 2018)

[29] (STAPLE ACT 1663, n.d.)

References

Grennes, T. (2017). An Economic Analysis of the Jones Act. Washington, D.C., United States of America: Mercatus Research. Retrieved February 27, 2018, from https://www.mercatus.org/system/files/mercatus-grennes-jones-act-v1.pdf

Legal Information Institute. (n.d.). § 877. Coastwise laws extended to island Territories and possessions. Retrieved from Legal Information Institute: https://www.law.cornell.edu/uscode/html/uscode46a/usc_sec_46a_00000877—-000-.html

Navigation Acts. (2018, March 3). Retrieved from Land of the Brave: https://www.landofthebrave.info/navigation-acts.htm

Siddiqui, S. (2017, October 9). Waiver encouraging foreign supply ships to reach Puerto Rico has expired. The Guardian. Retrieved March 3, 2018, from https://www.theguardian.com/world/2017/oct/09/jones-act-puerto-rico-expired

Smith, C. M. (2006). Navigation Acts (1651, 1660). Retrieved March 3, 2018, from NCPedia: https://www.ncpedia.org/navigation-acts-1651-1660

STAPLE ACT 1663. (n.d.). Retrieved from Project Gutenberg Self-Publishing Press: http://www.gutenberg.us/articles/staple_act_1663