Ah, the Jones Act.
In the wake of Hurricane Sandy, the President waived the Jones Act provisions barring foreign built tankers from carrying cargo between U.S. ports.
Is it a "statutory relic" which is outdated and counter-productive? Does it cause consumer prices to increase, unfairly hitting remote communities like Alaska, Hawaii and Puerto Rico? Should it be scrapped?
This Op-Ed from Bloomberg suggests that it is. Per this article:
Enacted in 1920, when memories of American ships being torpedoed off the East Coast were fresh, the Jones Act was designed to ensure that the U.S. had a fleet of loyal merchant ships in times of national emergency. The law, formally known as the Merchant Marine Act, required all vessels carrying goods between domestic ports to have been built in the U.S., as well as owned and crewed by Americans. Other provisions granted crew members the equivalent of health and disability protection.
By shutting out foreign competition, the law limits shipping capacity and inflates U.S. freight rates. Like most forms of protectionism, it benefits a few to the detriment of many. One analyst estimated that shipping oil from the Gulf Coast to the Northeast on foreign vessels would cost $1.20 a barrel versus $4 on U.S. ships. Although no one is quite sure of the overall economic burden imposed by the act, a 1999 study by the U.S. International Trade Commission found that ending it would save more than $1.3 billion a year.