Protect Jones Act by Revitalizing Marad

Professional Mariner Forum
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There’s a separate thread about the Jones Act that I wanted to insert this post in, re: Marad, but I didn’t want to get off topic there.

Basically, my thought is that for the Jones Act to be revised, which is not a bad thing, there needs to be a force preventing it from being wholly destroyed by hostile forces. Talking about repealing the Jones Act creates a window for its destruction, unless a strong force is ready to prevent it.

The strong force should be Marad. Marad should always stand ready to protect the U.S. mariner in the legislative arena. But Marad is incapable of that now. Therefore, Marad itself needs to be revitalized

Marad’s mandate should be to foster the entire maritime economy, train and license new mariners, provide a merchant marine capable of supporting the military in time of war, as well as protect it from domestic enemies. And a lot of that concerns the Jones Act.

Marad should focus on the entire maritime industry and not just the smallest part of it. A revitalized Marad would still have the same bandwidth for MMAs and the Reserve Fleet. The agency would just do more. It would also subsume some of the administrative work done by the USCG re: licensing and STCW.

Marad would be run by an active board of directors from six sectors of the maritime trades. The board (‘industry directors’) would consist of two people each from towing, OSV, deep sea, RV, commercial fishing, and two from shipyards. For each sector there would be one mariner/worker rep and one business rep. There would also be a military liaison group of two, from USCG and USN. An executive would be appointed by the presidential administration.

The industry directors would be voted-in by advisory groups made of mariners and company management from that particular sector. These advisory groups would meet periodically to give direction to their board members and to vote-in new reps.

The result would be to to transform the merchant marine from six tribes, as represented by the industry sectors, to as close as possible a single cohesive unit of professionals and business interests.

Things like licensing and STCW would be moved from USCG to Marad. The USCG does a fine job in the arena with what they have, but if the MM is truly a self-respecting industry it should sort out its own civilian affairs, as does the FAA.

RE: the Jones Act, any future contemplated changes to it would run through Marad. Marad would convene advisory sessions with ship owners and mariners and decide what changes to the Jones Act would be advisable, if any. If hostile business interests wanted to use such an opportunity to gut the Jones Act, the board of Marad, made from mariners, workers, and maritime business interests would be prepared to counter lies and disinformation, and mobilize the industry at large about the danger.

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The JA, at its core has always been a shipyard subsidy. And it has manifestly failed at that. Most of the issues with the JA are solved by allowing foreign built ships to re-flag.

The argument against this has always been the slippery slope argument. I have a great deal of skepticism about almost all slippery slope arguments. IMO they are just defensive arguments made to maintain a status quo by those who benefit from it the most

The status quo of the JA is not working- it is time for a change

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Interesting post by Freighterman. A lot of thought has gone into this. My 2 cents.

I think MARAD should be empowered to buy a controlling interest in a shipyard in Japan or South Korea. (No different than Hanwa buying Philly Shipyard). For a start, they should design and build a series of large ro-ro or self unloading ro-con vessels as part of the ready reserve fleet and retire all the old converted vessels. High spec and sophisticated vessels. They should consider enlisting the help of Maersk to design and manage the construction. Right away this will provide jobs for the MM.

Marad to no longer manage vessels. All Marad vessels should be managed and operated by MSC or similar.

Vessels from this yard shall be considered US Hulls and JA compliant. US citizen companies operating JA vessels should allowed to procure vessels from this yard.

Infrastructure upgrade in the existing US yards should be subsidized to ensure repair capability.

When (and if) there is sufficient qualified and trained US MM, legislation in a phased manner to allow foreign flag vessels only to call on 1 US port should be introduced (no calling on multiple ports on the eastern seaboard as well as the west coast). If this is introduced, very soon you will have many US flag (non JA) long haul vessels.

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And American companies from my sector would be completely wiped out. I know because a foreign company worked a dodge called the Bayside Connection that was essentially the same thing, siphoning cargo away from tug and barge companies too.

Whatever change is contemplated has to benefit the greatest number of mariners/businesses, and the tug/barge sector is much larger than deep sea. But that’s why there would be a board with by-laws, to hash it all out. Maybe unanimous vote to allow any major changes.

An alternative to your idea of Japanese shipyards is this: start shipyards in Mexico. Make ships there exactly the way the US car industry makes cars in modules in Mexico /Central America and then ships them across the border for assembly.

Making ships in modules and then towing them to other countries for finishing is old tech. Make the modules in Mexico and then tow them to shipyards in the southern US for final assembly. Works for cars, will work for ships.

American shipyards will be kept busy and American jobs will increase. At the same time employment will increase in Mexico /Central America, easing the Border problem. More jobs for the towing industry too.

Marad would set up the legal framework for this and then let private enterprise do its thing.

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Not sure I understand. If foreign flag vessels were restricted to say 1 port only, large container vessels may be uneconomical … unless the port is large enough to handle all the cargo. And then the road transport will be a bottleneck as well as uneconomical. Short sea shipping via tug/barge I suspect will also be uneconomical. Would this not make the shipping companies to consider flagging US?

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image

Consider inviting to this discussion Mr.Martin Stopford -author of Maritime Economics.

So You will tell OOCL to bring 17000 teu fully loaded behemoth to lets say NYK tell them to discharge all then what???

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I don’t see your point here. Perhaps because we are from different parts of the industry, and so perceive the problem a little differently.

All I can do is expand on my previous example:
The company I work for transports cargo between Alaskan ports and Seattle. The main Alaska port for us is Dutch Harbor, The cargo liner companies out of DH consist of my company (small coastal freighters), two tug/barge lines, and a container ship line, all carrying cargo to Seattle.

Over a decade ago another company began a service chartering foreign flag trampers (palletized cargo carriers, not containers) to move cargo from Dutch Harbor to the East coast. Technically Bayside, Nova Scotia, but through a complex bit of chicanery, actually Boston.

Because of the chicanery, it took ten years for the Justice Department to declare the ‘Bayside Connection’ a violation of the Jones Act and shut it down. During that time, our operation and that of the tug/barge lines, and to a lesser degree the container ship line were all negatively affected, in some cases severely.

If foreign container ship companies, or foreign tug and barge companies., were allowed to carry cargo from Dutch Harbor to just Seattle, it would wipe out my company and the American tug and barge lines in that trade. (It might also wipe out the American container ship trade, though I have knowledge about their operation.)

That’s why allowing a foreign vessel to make just one strop after touching at another American port can’t be allowed. It will wipe out American jobs. A revitalized Marad, directed by American labor and capital, would be able to perceive that danger, because they have skin in the game.

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Precisely the point. If they were to discharge (all the port can take) and then return overseas, either they will stop their service or consider flagging their US bound ships to US flag. These will be non JC compliant, but can call on multiple ports to discharge overseas cargo and load empties.
They will not be allowed to transport cargo between US ports - just as the foreign companies today.

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Ah … I now see that I did not explain well. Call on 1 port meaning from overseas. Cargo transport between US ports will require JA vessels.

When JA was enacted 100 years ago, I don’t think the author/congress envisioned the trade to grow to what we have today. Can be argued that the liner vessels today on the transatlantic voyage calling on NY, Philly, Baltimore, Charleston, etc or the transpacific calling on Seattle, Oakland, LA do not meet the intent of the JA … meaning how does this protect the American MM?

The major cargo transport between Alaska/Seattle, WC/Hawaii/Guam, EC/Puerto Rico will remain unchanged with the true intent of the JA. (except also allow the vessels to be built on a quasi US govt owned shipyard in Japan or Korea.)

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Was this the bullshit train ride to nowhere?

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Pretty simple really. Those foreign flagged, international trading ships don’t transport cargo originating from one US port and terminating at another US port. That cargo, domestic cargo, is reserved for Jones Act ships.

I work on foreign trading US flag container ships and we get a Jones Act violation if a US origin reefer container croaks between US ports and needs to be left on the next dock for repair. Any of the other reefers that originated elsewhere in the world would not be a problem, Until of course that box is then fixed and needs to reach its final US port. That is probably happening by truck or train at that point.

We are not the only country with such protectionist laws by the way.

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There shouldn’t be any mystery about the how and why of the cabotage section of the Jones Act, we have been enforcing the same rules on foreign air carriers since around 1920.

Take a look at the air cabotage law (49 U.S.C. 41703) and 19 CFR 122.165

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There is an interesting clause in the air cabotage laws that allow an exception for Alaska origin freight bound for the Lower 48.

49 USC § 41703(e)(2) It appears to this non-lawyer that the exception is written so that domestic carriers are compensated for what would otherwise be a loss of business to foreign carriers.

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Yes.

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Absolutely. The case in point being China. The Cato Institute and the Heritage Foundation want a system that allows Chinese ships to carry cargoes between American ports while American ships are prohibited from carrying cargo between Chinese ports.

Part of the brief of a revitalized Marad would be to explain the situation to Congress and the American public in precisely those terms.

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So is there is still some confusion on what I am proposing? Prohibit foreign carriers to call on multiple US ports to discharge. Only one port. Maersk will probably the first one to reflag some of their large owned/operated liners. Others will have no choice but to follow. This will create a shitload of jobs. Only one problem. Got to be ready with qualified people. Let’s hope the younger generation is interested in a career at sea.
That is why I had suggested this should be done in a phased manner.

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They are not.

Would you?

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Good question. Not sure with all the other alternatives available to make a decent living. But really does not matter to me as I am 67 and retired …. fat and happy probably with a big mouth and idiotic suggestions.

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Are you saying (example) allow a Chinese ship to go from Shanghai to Oakland to discharge Chinese cargo, but not allow it to then go to Long Beach on the same voyage to unload more Chinese cargo?

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Precisely.

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