Cabotage Laws: Jones Act and PSA

[travel-to-go]

I found this interesting website with information on the Jones Act and the PSA and its history, along with this page which gives examples of where you can or cannot go from a US port, the rules about Hawaii, Alaska, and one specific route between Canada and New York. Also interresting is Bermuda. Someone on one of the previous threads metioned only Aruba Bonaire, and Curacao are considered "Distant" Foreign Ports" for the Caribbean (Along with San Andres, Columbia) (click also on the link to Jones Act for more info)

 

http://www.cruiseco.com/Resources/cabotage.htm

I just thought it was pretty interesting. While many portions of the Jones act pertaining to health issues for seaman are very important, I don't think it now accomplishes its original intent of assuring more ships are built and owned in the US. I'm not sure what the value of a confusing (sort of) batch of rules and exceptions is today. Or the ramifications of altering the law to change that requirement (or altering the PSA, more specifically) Anyone have any thoughts? For that matter, any thoughts on the Jones Act itself, pertaining to cargo (not passenger) vessels? Not an area of vast knowledge (or much knowledge at all!) for me!

 

Previous discussion simply piqued my interest!

 

Karie

[joeinsb]

Karie,

 

Some time ago when I Googled Jones Act and PSA, I came across a site that listed American shipbuilders, which included as I recall, Ingalls in Mississippi, owned by one of the big defense contracters. This yard was responsible for building what ultimately became NCL's Hawaiian cruise ships. The one nearing completion was towed to Germany, I think, for final fitment, while parts for the other were also shipped there so the ship could be built there from keep up. The reasons the original project went bellyup are the bankruptcy of American Hawaii Cruises and budget overuns by the shipbuilders.

 

A few interesting aspects of the deal struck between NCL and the state of Hawaii:

 

The ships must be American flagged and crewed, which I understand they are.

No casinos are allowed on board, because certain folks in Hawaii are paranoid about permitting any form of gamling in The Islands. This is rather silly because many Hawaiians love to gamble and are Vegas regulars.

 

Again, this is off the top of my head, so don't quote me.

 

Cheers

[2moose]

Karie,

 

Some time ago when I Googled Jones Act and PSA, I came across a site that listed American shipbuilders, which included as I recall, Ingalls in Mississippi, owned by one of the big defense contracters. This yard was responsible for building what ultimately became NCL's Hawaiian cruise ships. The one nearing completion was towed to Germany, I think, for final fitment, while parts for the other were also shipped there so the ship could be built there from keep up. The reasons the original project went bellyup are the bankruptcy of American Hawaii Cruises and budget overuns by the shipbuilders.

 

A few interesting aspects of the deal struck between NCL and the state of Hawaii:

 

The ships must be American flagged and crewed, which I understand they are.

(No casinos are allowed on board, because certain folks in Hawaii are paranoid about permitting any form of gamling in The Islands. This is rather silly because many Hawaiians love to gamble and are Vegas regulars.

 

Again, this is off the top of my head, so don't quote me.

 

Cheers

I'm not up on maritime law but it seems to me many of these laws are old and outdated and need to be modernized!!!!!!( (i.e.jones act) just one mans uneducated opinion!!!!

[dougnewmanatsea]

I don't think it now accomplishes its original intent of assuring more ships are built and owned in the US.

This is somewhat arguable. Virtually all the ships engaged in cabotage in the US are, by law, built in US yards, and it would be inevitable that were this not the law, at least some of them wouldn't be.

 

Similarly, there's no doubt that some of these ships would fall into foreign hands if it were legal.

 

On the other hand, I also think that there can be little doubt that if foreign construction and ownership were allowed, there would be more ships trading between US ports. While US shipyards may fine at building small ferries and whatnot, they have not completed an oceangoing passenger ship in 48 years. The expertise has been lost - not only has the US missed out on five decades of technology in passenger shipbuilding but most of the people who knew how to build them 48 years ago are dead or at least retired.

 

The result is that the expertise to build these ships in the US is not there, and the law prohibits them from being built elsewhere, thus they are not built at all, and so there are fewer US coastwise trade vessels.

 

As for the ban on foreign ownership, this assumes that passenger ships are some sort of defense asset. There is no doubt that they were once, but they are not any longer. It has been almost 25 years since any country has used large passenger ships for purposes of war, and it is very unlikely that this will ever happen again. But of course, the existing US shipowners want to be protected from competition, and so they lobby to not have the laws changed. Meanwhile, the US shipbuilding industry is starved of foreign investment.

 

There are only two industries in the US which have restrictions like this, the other is the airline industry (whose regulations were based on those for shipping). And no, the shipping and airline industries are not any more crucial to defense than, say, the oil industry or the automobile industry or any number of other industries... But these laws have been around for a long time and those firms that face less competition because of them will of course do everything they can to keep them from changing.

 

I'm not sure what the value of a confusing (sort of) batch of rules and exceptions is today.

Well, notwithstanding the now very obsolete defense requirements, these laws basically existed for economic reasons. There is no doubt that a small number of shipowning and shipbuilding companies are protected from competition from these laws. Of course, protectionism as economic policy went out decades ago. I won't get into the merits, or lack thereof, of protectionism but there is no doubt that these laws date from a different era and are completely out-of-step with the conventional wisdom and establishment policies of today.

 

A few interesting aspects of the deal struck between NCL and the state of Hawaii:

Not the State of Hawaii - the US Congress.

 

Actually, the gambling thing is with Hawaii as that's a state law but that's not a "deal", they're just following the law... No special exceptions required.

 

The NCL America ships follow all the laws for being US coastwise trade vessels (as distinct from other US-flag vessels not allowed to engage in cabotage) except that they were not built in the US and they are not owned by US citizens. For this, they required an Act of Congress.

 

it seems to me many of these laws are old and outdated and need to be modernized!

Well, there's no doubt that they're old. The Passenger Services Act of 1886 dates to (surprise!) 1886, which I think we can all agree was A Long Time Ago.

 

Outdated... Well, yes, in the sense that they don't fit in with the mainstream economic theories of today, they are outdated.

 

Need to be modernized... This depends on whether you subscribe to today's mainstream economic theories. If you do (and presumably most people do, or else these theories would not be mainstream), they need to be modernized. If you don't, then maybe you think it's all the other regulations in other industries that need to be de-modernized. I'm not going to tell you what to think ;) ...

[Druke I]

At one point, in the not too distant past, Sen. D. Feinstein (D-CA) stated that she was going to work to change the law, and try to encourage more cruise ships to call at San Francisco.

 

Not having heard anything further, I chalked this up to "political posturing".

[mufi]

I would call it anti trade.

 

David.

[joeinsb]

Gang,

 

I'm all for modernizing. Although I have nothing against Vancouver as a point of departure for many West Coast cruises, I like the convenience of sailing out of LA, which is where we live. In fact I wish more lines did West Coast cruises. As for the PSA et all, last thing I saw on Google was that McCain had been behind mordenizing, but that the issue was dead.