Jones Act Greatly Benefits America

The US freight cabotage law offers a wide range of benefits without costing the government a penny, and should be hailed as both a commercial and public policy success.

That’s what Thomas Allegretti said in his Feb. 14 remarks at the Maritime Trades Department (MTD) meeting in Houston. Allegretti chairs the powerful American Maritime Partnership (AMP), whose 450-plus member organizations (including the SIU) promote the domestic maritime industry; and he also serves as president and CEO of the American Waterways Operators (AWO), the national trade association representing the inland and coastal tugboat, towboat and barge industry.

In an upbeat report on the state of the industry, Allegretti underscored the importance of political action and the direct link between Jones Act stability and maritime growth. He also reminded the audience that the Jones Act pumps billions of dollars each year into the U.S. economy while helping sustain nearly 500,000 jobs.

In the U.S., there are approximately 4,000 towing vessels and 26,000 barges operating on the inland waterways, coasts, Great Lakes, ports and harbors. They move 800 million tons of cargo each year.

The Jones Act requires that cargo moving between domestic ports must move on vessels that are crewed, flagged, built and owned American. Most other industrialized nations have similar laws reserving domestic commerce for their own flags.

“This law provides a vital merchant marine that stays under American control,” Allegretti stated. “The result is not just good for us but it’s good for our country.

“I’m very pleased to report to you that the state of the Jones Act and the domestic maritime industry is stronger than it has been at any time in recent memory. Our industry is undergoing a resurgence that’s fueled by new, exciting developments in the movement of energy cargoes…. We’re witnessing a surge in the construction of American vessels the likes of which we have not seen in many years.”

He cautioned, however, that no one should forget “that this resurgence has its roots in a confidence that the Jones Act is and will remain the law of the land. It is our collective responsibility to ensure its preservation.”

Expanding on the topic of shipbuilding, Allegretti pointed out, “These are state-of-the-art vessels. There is now a long list of containerships, tankers, ATBs, dredges, tugs, barges and other vessels under construction or on the order books. In a typical year, American shipyards build more than 1,000 vessels, and this new surge has grown even beyond that.

“In short, this is an industry that is investing billions of dollars to ensure its resilience. This investment and this growth simply would not happen without the Jones Act, which gives American companies the confidence to make these multi-billion-dollar investments.”

Things weren’t always as promising. Allegretti recalled that when AMP was formed nearly 20 years ago, grave concerns existed about the industry.

However, Allegretti said that the leadership of MTD President Michael Sacco (who also is president of the SIU) helped get the industry back on course.

“Not many of you may know this, but Mike was the leader of the effort to establish AMP two decades ago,” Allegretti said. “I remember very vividly the speech where he told us that if we didn’t get our act together and build a national coalition to come together in defense of the Jones Act, that we were going to lose the Jones Act. He was our wakeup call.”

Allegretti also saluted the long-running efforts of James Henry, chairman of the Transportation Institute and past chair of AMP (currently vice chairman), whom he described as a highly effective elder statesman: “His leadership over the last two decades has been absolutely critical to AMP’s success.”

A unified approach is only one key to victory, however. Allegretti said political action is also vital — and on that front, maritime labor sets a great example.

“You play an indispensable role in building support for the Jones Act and for our industry on Capitol Hill and with the executive branch,” he said. “In many ways, the work that AMP does takes its cue from maritime labor. You all have really perfected the art of building relationships on Capitol Hill, and it really is an art. Not everybody gets it right. You go tirelessly to the Hill in times of plenty and in times of want — to build relationships, to educate members of Congress and their staffs. You do it day in and day out over years that have stretched into decades. You provide members of Congress with accurate, fair information and the results speak for themselves. You guys always play the long game and not everybody does that well. You do.”

He said AMP’s lobbying activities are modeled after those of organized labor and emphasized, “We have a powerful story to tell about how critical the industry is to America’s success. This is an industry that provides real, family-wage jobs that truly epitomize the American dream. In his State of the Union address, the president talked about ladders of career opportunity. You can’t find a better example of a ladder of career opportunity than the one our industry offers young men and women, and the Jones Act is what makes this opportunity possible (because of) jobs that can’t be outsourced.”

When it comes to security, Allegretti said both the Defense Department as a whole and the U.S. Navy in particular “strongly support the domestic maritime industry, and the Jones Act as its statutory foundation, because strong vessel operating companies, a skilled, available supply of mariners, and a robust shipbuilding and ship-repair industrial base are critical force multipliers that the U.S. government must have, but could not sustain without the commercial American domestic maritime industry.”

He concluded that AMP is proud of its partnership with labor and will not become complacent.

[mappress]

SIU, February 21, 2014