Seems like this is a case where the "soft touch" approach—set rules and let the market create the outcome you wanted—isn't working, so maybe a more direct approach would be a better idea for the purpose of ensuring a healthy merchant marine fleet, if that's still something we want to do.

Why does US "need" a 100% internally built, owned and operated merchant marine fleet?

Most of US is accessible via freight rail or road freight transport. Ships transport almost exclusively foreign made products, today.

That's the primary reason why the merchant fleet is wasting away - there's no demand for marine transportation between US ports, other than required by Jones Act.

I have 0 interest in building something that has little to no use in a free market.

> Ships transport almost exclusively foreign made products, today.

You understand that this is because the Jones Act makes shipping domestically prohibitively expensive. Which is precisely why ground shippers are insistent that the Jones Act remain on the books.

> I have 0 interest in building something that has little to no use in a free market.

If you see a free market there, you haven't read the article.

> If you see a free market there

That's not what I wrote.

Shipbuilding capacity, especially, is extremely important for being able to project power globally in the most extreme situations. So if that's something we're still interested in doing, it's a very good idea to prevent that capacity from falling under some level.

The problem is, the Jones Act has harmed our shipbuilding capacity as well. According to the artcle our ship building capacity is 1% of China's and US built ships cost 6-8 times as much. That's not helpful.

> The problem is, the Jones Act has harmed our shipbuilding capacity as well. According to the artcle our ship building capacity is 1% of China's and US built ships cost 6-8 times as much. That's not helpful.

So better have ship building capacity at 0% of China's and it be impossible to buy US built ships at any cost?

That, or make it easier to start up domestic shipbuilders.

In a vacuum, the Jones Act should be encouraging the construction of new shipyards and/or freight rail infrastructure. That neither seems to have happened suggests that other barriers exist, and those barriers need addressed, Jones Act or no.

U.S. built things costing 6-8 times as much as Chinese built things is not specific to shipbuilding.

Sure, my point is that there's not no good reason to want to protect US ship-building capacity, not that the Jones Act doesn't suck, which AFAIK it does.

That would be done via planned navy ship replacement. Not by Jone's Act and similar.

Let alone - merchant ships are needed to trade and interact with allies in these extreme situations. And last I checked Maersk is a Danish company, and Danmark is a close ally.

You can't guarantee allies' shipbuilding capacity will remain intact in war, or that they won't redirect their shipping or ship-building capacity for other purposes, and without shipping the US cannot meaningfully act globally. Things are relatively stable now and most major US allies seem to be in pretty secure positions (a tad less so right now, sure, but in general, for some decades) but I don't think the smart money's on us getting through this century without at least one big war, possibly not even caused by or involving any of the powers that seem most-likely to kick something off now, so there's no guarantee the major action would be confined to or even primarily in, say, the Pacific theater, meaning that it'd be a good idea to be prepared for any of our allies to be taken off the table early in a conflict (or even for their being on the other side of it).

I agree that the Jones Act sucks, but I do think there's some valid reason behind trying to do what it tried to do.

If you don't have overseas allies, then you don't need a large merchant fleet at all.

As it stands - merchant fleet of US allied nations is strong enough for US to not need one at all.

Then you’ll get steamrolled when you need to expand or build a merchant navy on short notice against the adversary which builds all your existing merchant fleet cough China cough, not that they don’t ALREADY have us by the balls in a million other ways.

China doesn't dominate shipbuilding in the same way it dominates most industries. Japan and South Korea have active shipbuilders building immense container ships (Ever Given was built in Japan), and Europe dominates the cruise ship industry.

It's still a national security issue that there's little domestic shipbuilding. In the event of a major war, it would be useful to have domestic shipbuilders available to press into service making warships, beyond the peacetime warship builders.

Quite true! Geographically, keep in mind it would be trivial to blockade South Korea from China, and South Korea has been invaded by a Chinese Puppet state in the somewhat recent past (North Korea), with which they are still technically at war.

It’s no ship yard in Seattle.

You can't count on industry in any state that's going to be a direct war participant and on or, these days, even kinda-close to, the front lines, anyway. Look at Ukraine, and they're arguably winning. That's how fucked-up your production capacity gets when you're more-or-less successfully repelling an invasion, let alone when you're plainly losing. The other day they had, what, 30% of their energy infrastructure damaged, by their own government's admission? And the only reason it hadn't happened sooner seems to be that Russia just hadn't decided to do it yet (not to overstate Russia's advantage—part of why they hadn't done it yet was probably that they have limited ability to restock their own weapons, so preferred to hold such weapons in reserve for a time). Plus all the bombed or captured factories, difficulty and danger getting inputs and workers to any surviving factories, et c.

> Japan and South Korea have active shipbuilders building immense container ships (Ever Given was built in Japan), and Europe dominates the cruise ship industry.

Cruise missiles have entered the chat

Besides, it's very nice in these scenarios to build your ships the same place that's sending cargo, so you don't have to risk an empty or low-priority cargo trip the wrong direction before you can load up with the good stuff.

Plus, governments change. The US could well end up on a different side of a conflict from some current allies, or those allies might remain neutral and so avoid behaving too-favorably to the US.

Actually, I think most of the US merchant fleet was built by South Korea, not China.

National defense. In peace time a merchant marine fleet may have poor economics but is immensely valuable to have during wartime. You can’t just snap your fingers when that happens and magically get all of the boats and crew and logistics in place so instead we the people have to pay to maintain it.

Let's pretend that there's a global conflict and US is both against "United Asia" and "European Empire" - what would be a need for such a fleet?

If we're talking about US/European allies vs China - then European allies have the ships and capacity to build more.

You have to give a concrete example where US would need to have a merchant fleet, where allies aren't willing to provide.

A more likely scenario is that we'd be supporting allies in those theaters, not fighting united continent-blocs. Either way, you can't fight across an ocean without lots and lots of cargo ships.

> If we're talking about US/European allies vs China - then European allies have the ships and capacity to build more.

Not necessarily enough capacity if you're losing tens of ships a month, and there's no guarantee those would remain intact, or that we'd even be on the same side. It's easy to assume stable, decent-enough, friendly governments will continue to be that way indefinitely, but they may not (for other actors, it's very much worth worrying whether the US will remain so, for instance)

> You have to give a concrete example where US would need to have a merchant fleet, where allies aren't willing to provide.

We literally have a real world example, which is far more valuable than made-up scenarios, that was arguably won primarily by US industrial capacity and the ships to direct that output to the right places, and it's still (barely, admittedly) within living memory. Among the most famous machines of that war is a class of merchant ship, for very good reason.

Unless we suppose that modern great-powers wars will be over so fast that shipping wouldn't have time to play a major role, or we think that anti-shipping weapons would be so effective and have such wide reach that no amount of shipping & protection could keep a meaningful proportion of a shipping fleet afloat for any useful length of time even if we started with a significant upper-hand overall—and I sure wouldn't want to bet on either of those things—it seems like that'd still be highly relevant in any major conflict in, at least, the near- to mid-term future.

> We literally have a real world example

I'm not a mind reader - what is it?

It's harder to bully/manage foreign shipyards than it is domestic ones. Even better if they're on the eastern seaboard within easy drive of D.C.

Central and South America exist too and in your scenario South America would be the only way to get certain resources.

If the US is fighting with (or just in!) Asia and Europe, they still want to trade with Australia, Africa, and South America. And, they likely need to get a lot of materiel to the theater.

In the last World War, the US built a ton of cargo ships (about 6,000) to replace ships that were sunk and to increase shipment capacity in general. Allies weren't able to build ships fast enough. I'd imagine that capacity will be needed in the next world war, too. Having existing shipyards helps get production ramping sooner.

Certainly, ware has changed a lot in 80 years, but all out war is still going to need a lot of shipping, and cargo ships carrying war materiel are going to be fair game for sinking, and need to be replaced (as well as escorted). Industrial capacity and availability of fuel will continue to be necessary but not sufficient for success on the battlefield.

If the US needs naval capacity, it just leases it from foreign providers [0].

[0] https://sgp.fas.org/crs/weapons/RS22454.pdf

The thesis is that there would be, if we allowed foreign ships and to operate in the US.

Water transport is much, much cheaper where there is not a burden, and is generally also more fuel-efficient per ton-mile. It should be possible for a wide variety of goods; the Mississippi alone is the largest river system in the world.

> the Mississippi alone is the largest river system in the world.

Mississippi is only the largest in the world after the Nile, Amazon, & Yangtze.

argh, not had the coffee yet. largest in North America.

It's also good that the Mississippi is so navigable, pretty much all the way north-south through the country up to Minneapolis. The Nile is only really navigable to Aswan High Dam, the Yangtze and Amazon fare better on this metric.

Plus a ton of the Missouri is navigable. IIRC if you were to judge the Missouri the official continuation of the Mississippi, where they meet in St. Louis, the resulting river would be even longer than the Mississippi as currently judged (though, also IIRC, its total flow where it meets the Mississippi is the smaller of the two by a decent margin, so that'd be hard to justify)

The Mississippi River Watershed includes the Missouri and Ohio Rivers, and 59% of all US rivers, draining parts or all of 32 states.[1] It is really an astoundingly massive river system, which is why it is the fourth largest in the world.

[1] https://assets.bwbx.io/images/users/iqjWHBFdfxIU/i9QxpflmIAz...

> I have 0 interest in building something that has little to no use in a free market.

Nation states have goals that the free market doesn’t value like stability or risk mitigation. Keeping an industry that can become critical around in a reduced capacity so that you don’t need to bootstrap from scratch is to governments like purchasing insurance on a car is for an individual who relies on one for their income.

The free market absolutely does value stability and risk mitigation because they have direct implications for the cost of financing which directly tacks onto the cost of any given capital investment.

They value it in the same way that I nebulously value the environment but still buy things wrapped in single use plastics. The free market has shown that they currently value efficiency over stability which has led to the rise of JIT logistics and manufacturers being unable to produce goods after a hiccup of a few months on their supply chain.

There is no equivalent section of the free market that is looking on multi decade long horizons for risk mitigation in the same way that governments do.[1]There are industries that care about risk mitigation on 30-50 year schedules for individual pieces of heavy industrial capital but there aren’t any that will actively run or subsidize factories building parts for a market they don’t participate in for decades on the off chance they might need to spin that up ASAP.

[1]generalizing here. I’m sure you can find a handful of companies who do this but unless they represent double digit percentages of the entire economy I’m not going to be convinced that it’s a sign of the free market valuing stability

There's still shipbuilders up and down both US coasts. They don't build that many ships, but they'd almost certainly disappear if foreign vessels were an option.

If having any local shipbuilding capability is better than none, the act works enough.

IMHO, I'd drop Puerto Rico and other island territories from the act. Maybe Hawaii and Alaska too. The inducement to build and operate US based cargo ships for those markets clearly isn't sufficient, and it hurts the economy of the territories for little benefit. But keep it for the mainland --- I think effectively reserving US ports for foreign trade reduces import/export costs which helps the US interface with the global market.

>the act works enough

Does it though, or is this a false sense of security? Regardless of the Jones Act the Navy is paying to modernize shipyards [0]. Meanwhile the small shipping industry propped up by the Jones Act seems to severely outdated, they were using steamships well past when the rest of the world stopped using them and manage to get away with more corruption due to lack of competition [1]. Maybe just drop the act, and have the Navy responsible for shipyards directly & ongoing, or something rather than hope a bunch of old fashioned, inefficient shipyards will be sufficient when we need them most?

https://www.gao.gov/products/gao-22-105993

https://www.freightwaves.com/news/freightwaves-classicsfalle...

US doesn't build non-military ships in any sizeable quantities, to maintain any of those anymore.

Jone's Act doesn't protect any shipbuilding facility, beyond the existing government contracts forwarded to them.

Which then keeps at least BASIC knowledge of shipbuilding available in this country, should we suddenly require grow in that industry (which is crucial). You are either misleading the purpose of this act or are willfully ignorant.

Correct: this is also why we ban importation of foreign food, so they Americans can keep at least BASIC knowledge of agriculture. Similarly, we require that air transportation in US is only done on US made planes, so that US keeps at least basic knowledge of building planes. Without these measures, those industries would be gone.

But is there a better way to subsidize shipbuilding capacity? I agree with your suggestion for focusing the Jones Act on the continental US, at a minimum that would reduce the disproportionate burden that states and territories outside the continental US face.

I'm sure there is. But when the headline is repeal the act, not replace it, it's important to note that it has some of its intended effect, even if it's not very much.

Something that actually resulted in productive shipyards would be much better than what we have that results in shipyards that don't produce much, which is still likely better than no shipyards outside of those producing naval vessels and domestic ferries (although, those would probably be imported too, if that were legal; technically that's prohibited under a different act)

There is a clearer way to subsidize than to require the purchases. One is to literally directly subsidize the industry. Another is cheaply lend or even grant money to the customers buying the product but only when buying domestically made units.

It also strikes me that the percentages mentioned in the article are very high. 75% US crew? 75% US owned? 100% US built? Revising the statute to operators needing 55% of their domestic fleet being US built, and requiring 55% US ownership, and a 55% US crew should be more than sufficient. Give tax incentives for newer, more efficient craft both to the manufacturer and the buyer.

The US uses a lot of military power for non-combat purposes. We move supplies for natural and humanitarian disasters. We have water purification ships, hospital ships, and generator ships. We transport weapons systems as cargo, and even those ships themselves could be mostly protected by a surrounding fleet. If we could get a design made that's fitting for heavy movers suitable for both military and civilian use the US government's purchases could bolster domestic shippers' orders.

One even more unusual option since it's a national security concern is the US government could buy large numbers of newer, more efficient craft and lease them on affordable terms (or lease to own even) to cargo companies.

US shipbuilders get orders mainly from military. Civilian orders is almost zero. The facility and technology for military vs civilian ships are vast, that a shipyard focusing on one cannot efficiently work on the other.

I don’t think that it’s a problem. If a facility is designed for civilian products, and can only work on government contracts inefficiently, that sounds like… all government contracts in recent memory. It is well known that US government overpays on everything anyway.

If we’re going to endure a cost to keep local ship building capacity id rather the government just directly subsidize the construction of ships via credits to purchasers ala evs, or just direct purchases and finding a use for the ships. Limiting the market to try and force the choice ruins the efficiency of the market and doesn’t guarantee a local minimum amount of capacity

There are only 4 US shipbuilders still capable of building large ocean-going commercial ships, and they pretty much exclusively subsist off government contracts. The US used to be the world's leading builder of commercial ships by a wide margin, now it barely produces any.

https://www.freightwaves.com/news/freightwaves-classics-amer....

Man, sounds like we DEFINITELY need to protect that market then doesn't it? It's like having a professional army, you don't have enough soldiers to fight a world war, but you have enough knowledge base to train people up SHOULD a world war happen. Would you argue we should either disband the Army or institute a draft to increase it's size because it can't fight a world war and other nations have a larger army? What a non-serious argument is being made here all in the name of $$$. You understand that a nation exists to fulfill a certain social contract, right? You can't keep just chipping away that contract in the name of 'paying foreign country level wages' and expect a functioning country. That 'social' element WILL turn against this behavior at some point.

It sounds like the current system utterly failed to protect the market. The Jones act encourages US shipping to be done over land, meaning there are fewer orders for ships and less (at this point zero) work for US shipyards. Mandating that US ships be US made only works if there are still US ships. We should instead be reinstating the subsidies that used to be in place to keep American shipbuilders competitive with other countries who subsidize their shipbuilding industries for exactly the same strategic considerations. Keeping in place the same policies that destroyed American shipbuilding is very bad for our future as a naval power.

So why not just push for subsidies since that is the entirety of the argument you just made? Does China have it's own version of the Jones Act? Since China is the 'model of success' as the largest ship builder, do they allow foreign ships and foreign crews?

I very clearly also argued that the Jones act's repeal also helps. Why would you invest in something while at the same time actively harming it? America's shipbuilding industry is a husk of its former self and every effort must be made to revitalize it. Subsidies alone would be a half measure.

China does not have its own version of the Jones act, it's a uniquely American problem. Most countries aren't stupid enough to kill their internal industry.

> Except, as far as I'm aware, the Jones Act hasn't prevented the collapse of the merchant marine fleet--in other words, it's failed to do its primary goal, and it has some pretty heft costs for everyone who doesn't live in mainland US.

Then instead of repeal it, fix it. I wonder if the flaw is that it didn't account for the changes in American sea traffic as foreign imports have undoubtedly increased by orders of magnitude since it was passed 100 years ago.

Can you describe the "fix"? US shippers would rather pay for trucking, rail, pipelines, or air freight rather than pay through the nose for US-built marine vessels.

This is a consequence of math. The economics just don't make sense. I'm not sure what you can do to "fix it".

The US merchant marine fleet has declined (in terms of ship numbers) from 16.7% of the global fleet in 1960 (3000 ships) to 0.4% in 2019 (180 ships).