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Help for Puerto Rico Was Being Delayed by the Jones Act. What's That?
12:07 PM ET
While Puerto Rico begins the long recovery process after Hurricane Maria, experts say that waiving a law known as the Jones Act could help. But the Trump Administration on Tuesday declined to waive the statute, also known as the Merchant Marine Act of 1920. Here's what to know about the law.
What was the origin of the Jones Act?
The Jones Act was put in place after World War II, when the threat of German U-boats (which sunk almost 5,000 ships during the war) was still fresh. The statute required that any ship carrying goods from one U.S. port to another be made in America, staffed with Americans, and owned by an American. The idea was to support the American shipbuilding and marine shipping industries from competition, so that they would be sufficiently robust should another conflict begin.
What is its legacy?
As many have argued, the Jones Act has long outlived its usefulness. German U-boats no longer pose a threat to the U.S., and the act now mainly serves to bolster the American shipping industry, effectively giving it a monopoly on shipping to ports like those in Puerto Rico. The effect is to increase costs for consumers. If a foreign ship unloads in Puerto Rico, it must pay high tariffs, taxes and fees, costs which get passed along to consumers. If it first unloads in Florida and the products are shipped from there to Puerto Rico, the cost of rerouting will also be passed to the consumer, one Puerto Rico expert recently wrote in the New York Times. The result is that American goods cost twice as much in Puerto Rico as they do in other parts of the region, like the U.S. Virgin Islands, which are not covered by the Jones Act. Critics say it is a protectionist law, and multiple studies say it has cost the Puerto Rican economy billions of dollars.
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