The Jones Act
At a Glance…
- The Jones Act is an antiquated law dating back to the 1920s and its effects on Puerto Rico have made the Island less competitive economically, making essential goods like food and clothing less affordable for its residents, and have deprived other US workers and companies of greater opportunities thanks to the senseless restrictions of this act.
- The Jones Act requires that all interstate commerce within the US be conducted in US owned, crewed and manufactured ships. These are the most expensive in the world.
- Puerto Rico is an island that imports more than 80% of all the food it consumes. The Jones Act has been proven to essentially tax the Puerto Rican economy $1.1 billion a year that consumers in the Island would otherwise not have to pay, according to two recent studies.
- Puerto Rico has a poverty rate of more than 40%. The Island has suffered an economic recession for more than 12 years. The disproportionate costs of the Jones Act on Puerto Rico are unfair and only bold presidential leadership can make a difference.
Power 4 Puerto Rico is calling for: - Congress to permanently exempt Puerto Rico from the harmful Jones Act and air cabotage laws that make consumers pay artificially higher prices and increases costs for businesses, therefore harming the economy.
- While Congress works on this issue, the President should issue a full Jones Act waiver for Puerto Rico, for at least the duration of the recovery from Hurricane Maria.
Frequently Asked Questions
Q: Exempting Puerto Rico from the Jones Act might help the island but how does it help the mainland?
A: Because of the Jones Act restrictions – which do not apply in the neighboring territory of the US Virgin Islands –companies in the states are not able to sell their many of their products to Puerto Rico. For example, right now, the US has no qualified Jones Act vessel to carry Liquified Natural Gas between US ports. This forces Puerto Rico to buy LNG from Russia and Trinidad and Tobago instead of Texas or Louisiana.
Q: Isn’t the purpose of the Jones Act to ensure national security and wouldn’t tinkering with the act harm our security?
A: The 1920 law we are talking about was legislated during an age when German U Boats were downing American cargo ships during World War I and before WWII. Experts agree that there is no national security risk for exempting Puerto Rico. The USVI is exempt and that has not harmed US national security in one bit.
Q: Doesn’t the Jones Act protect US jobs and industry (the shipbuilders)?
A: The reality is that statistics show the opposite. The opportunities created by increased competition would actually generate job growth.
Q: Doesn’t the Jones Act actually benefit Puerto Rico since there is a steady, regular stream of shipments that go to the island no matter whether cargo boats return empty or not? Doesn’t the Jones Act guarantee stability?
A: Again, the law does not apply to the USVI nor to neighboring islands and that has not been a concern. We shouldn’t be in the business of protecting the shipping oligopoly in the island. Many of those companies plead guilty and paid multi-million-dollar fines for price gouging in Puerto Rico.
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