Should the US build requirement of the Jones Act be abolished?

Article from today’s NY Times I’ll share.

From the NYT article:

At 700:1 it is obviously an uphill battle to "blunt China’s dominance of this industry,”

Maybe better to concentrate on some other way to “re-establish US dominance” than to try stopping others from building ships where they get the best deal?

If you look at the history of Chinese manufacturing and technology you’ll see they adopted and refined processes that were freely given to them by other countries. Apple and Tesla come to mind though in the case of Tesla they took the EV idea and jumped ahead by a lot. The case of Apple is a good study in technology and manufacturing know how transferred to China which increased Apple’s stock price immensely over 20+ years. China is simply copying the Japanese model after WW II of having a national industrial plan and doing whatever it takes to get ahead. Of course Apple could re-shore the iPhone if they could find customers willing to pay $3000 a phone. When it comes down to it the average US consumer at the current average family annual wage cannot afford to pay the premium for most products if they were ‘Made in the USA”. Ask Walmart :grinning_face:

China is doing what others have done for millenniums, they are learning from others.
So did the US in its early stages of development, as did the Europeans and others at the early stages of the Offshore Oil & Gas industry spreading around the world.
This is just the way things develop, although at every step somebody will claim that their innovations have been “stolen”.
No country can lay claim to be the ONLY one to invent new things, nor to have fostered ALL the inventors.

Modern EV was “invented” in Norway
Ford bought up the company and killed it to avoid competition with their gas guzzling models: Think Global - Wikipedia

That is correct, it is “China First”, but that is not a new idea.
US want to keep China down, China will retaliate.

PS: Learning from others is not a sign of weakness, it is a wise thing to do.

Update:
Not everything goes according to plan in China either:

“PS: Learning from others is not a sign of weakness, it is a wise thing to do.”

That’s true, but U.S. corporations gave away the farm for the sake of profit, and then moaned that they couldn’t compete against the recipients. I don’t call that true learning on the part of the Chinese.

What do you call it than? US corporations set up shop, or signed manufacturing contracts with local companies, in China and elsewhere, to take advantage of cheap labour.

They thus inevitably gave away technological to the recipient companies and countries, but now cries foul when those same companies and countries have learnt to not only produce, but even improve on the products and technology they had learnt, to compete with US companies on their home market.

I know what you want to say; “China forced them to disclose trade secret to be able to set up shop there” :hot_face:

No, they were not “forced”, they could have refused to comply and continued producing their products in the US, but then at higher costs and lower profit.

Now the shoe is on the other foot in many cases. For instance: (to stay OT)

  • US shipyards have to learn from S. Korean and others how to build ships efficiently and cost competitively.

  • Most of the MODUs working in US deep waters are foreign built, to foreign design, with largely foreign made equipment.

  • Nearly all import and export to/from USA is carried on foreign flagged, foreign built ship. Even most of the US-flag “foreign trade” and MSP fleet are foreign built: https://www.maritime.dot.gov/sites/marad.dot.gov/files/2024-01/MSP%20Fleet%20%202024-01.pdf

There is nothing wrong with this, something similar applies for nearly all maritime nations.

What is wrong is to insist on maintaining old nationalistic laws, rules and regulations that make it difficult to operate a modern merchant fleet competitively.

PS: you can maintain cabotage laws for domestic trade and national crewing rules for US-flag ships, by adopting more logical laws in line with international practise.
This can even be done without costing the taxpayers a lot of money, or reducing military readiness.

OK now I`m expecting to hear the usual ritual:

  • As a foreigner I dont know what Im talking about.
  • I cant possibly understand anything of this, as I dont live USA.
  • I`m “anti-American”.

I don’t think “trade secrets” had anything to do with it. Your first two paragraphs simply agree with what I wrote. It’s true that the Chinese have taken what was given to them and run with it. I don’t blame them. I blame the executives and boards that made those stupid, stupid decisions to ruin American manufacturing.

No problem, when the die-off of the uninsured poor gains speed the market for cheap stuff will end.

  • As a foreigner You dont know what Urtalking about.

  • U cant possibly understand anything of this, as U dont live in USA.

  • You surely are super duper “anti-American” . Simple as that Dear Dr. Bugge.

:winking_face_with_tongue:

With my rabid free market hat on: government subsidy is bad.

With my sensible hat on: government subsidies can be a worthwhile investment for the Commonwealth. But: commercial shipbuilding is a bad investment. You would be competing against countries with more experience and lower costs and government subsidies of their own.

You and me both are foreigners in USA. Does the same apply equally?

And those living in USA can`t possibly understand anything about the rest of the world?

Thank you!! Better to be “super duper” something than a nobody that doesn`t question anything.

Commercial shipbuilding is not the only objective. Creating economies of scale lowers cost of specialized ships–i.e. warships–which benefits both sectors. Adding commercial US tonnage drives semi-skilled and skilled trade jobs, in addition to professional jobs, improving opportunities for advancement for the US workforce. Shipbuilding also has crossover with other heavy industrial sectors, increasing the base of skilled workers across those industries with the commensurate increased economy of scale for the supporting industries–steel-making, equipment manufacture, etc. It also serves to decrease the leverage an economic and military adversary has when there are multiple sources of supply, including domestic.

Witness the reaction of Europe to US requests that they start picking up their share of the tab for the NATO defense of Europe–ignore the polite requests for decades, then cozy up to China when the US uses stronger language, in spite of all the flowery talk about democracy, human rights, fairness, etc. That unreliability of allies is probably the biggest counter to the argument that the US should just start building ships in South Korea and Japan and Europe, instead of investing in our own people and industry, first.

Doug

In years gone by many of our Chief Engineers started their career as an apprenticeship in the naval dockyard. There was a dedicated training officer for the apprentices that ranged from Fitting and Turning, Electrical Fitter, Shipwright, Boilermaker and Electrician to name some of the trades. Both the academic and practical training was structured and they were encouraged to seek advanced trades.
Those that wanted to go to see first obtained a third marine engineer qualification before coming to sea as a junior engineer.
In my experience and backed up by feedback from many employers this path resulted in the best qualified people.
Unfortunately those days are gone and there is little exposure to heavy engineering available.

The common funding for NATO expenditure is set by the NATO treaty and updated recently in the “Cost share arrangements for civil budget, military budget and NATO Security Investment Programme”, called Cost Share “at 32”

Common funding is an important element of burden-sharing, demonstrating the effective sharing of responsibilities, risks and benefits among Allies.
From 1. Jan 2026 the share paid by USA and Germany is the same,
at 14.9039% The other member countries pay according the agreed % of the total according to the agreement.

Each member`s contribution can be found here: Funding NATO | NATO Topic

What you are alluding to is probably the agreement that each member country shall spend 3.5% of GDP on direct defence and 1.5% to “protect critical infrastructure, defend networks, ensure civil preparedness and resilience, innovate, and strengthen the defence industrial base” by 2035

No, I was referring to the prior agreement established in 2014 to spend 2% of GDP, which very few nations met, as well as prior US requests that member nations increase spending after the initial “peace dividend” period. It took re-election of Trump for a second term before the European members began to realize the US might be serious and their response has been characterized by tantrums and the aforementioned cozying up to China.

Europe didn’t meet the 2% target at any point in a decade, so I’m skeptical that the 3.5% by 2035 will be met. I’d be happy to be proven wrong, but not surprised if it doesn’t happen.

Doug

What are you referring to here specifically?

Not sure there are a lot of arguments against all those points. There is certainly a valid argument to be made for shipbuilding as a strategic industry. The issue is, empirically, in the real world, the JA has failed to support a strategically important level of shipbuilding. It boggles the mind a bit, the continued support of a program, that by any reasonable measure, has failed so miserably.

Those who live that long will see.

The US military contractors are enjoying the benefits from NATO. No wonder certain US politicians want NATO to spend more.

But why are you saying that it has failed because there have been new vessels built in the US for the Jones act protected trades in the past decade it’s just that there aren’t very many being built. Far more smaller vessels are built in the US and while those yards may not be set up to construct ocean going tonnage they do provide support for the industry.

Of course if there was no US build requirement for coastwise trading there may be a few more ships in it but vessel operators will not go on some great spending spree either. They have no incentive to own tonnage surplus to the demand. Maybe fewer tugs and barges being used in the petroleum trade is all I can see.