[Congressional Record Volume 143, Number 86 (Thursday, June 19, 1997)]
[House]
[Page H4070]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                         UPDATING THE JONES ACT

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from Michigan [Mr. Smith] is recognized for 5 minutes.
  Mr. SMITH of Michigan. Am I allowed to whistle, Mr. Speaker, in the 
Chamber to get everybody's attention?
  The SPEAKER pro tempore (Mr. Cooksey). No. The Chair will get order 
with the gavel.
  Mr. SMITH of Michigan. Mr. Speaker, today we are introducing a bill 
that changes the law that was passed in 1920 that is now disrupting 
commerce, that is now putting Americans out of jobs and out of 
business, that is making American consumers pay much more for their 
products than they otherwise might pay. That law in 1920 was passed in 
order to get the United States of America going in terms of building 
our sea fleet, our ships, in terms of getting a crew of sailors that 
were trained that could help this country in time of war, in time of 
commerce. That bill is known as the Jones Act.
  That Jones Act bill does several things. It said that one has to have 
a U.S.-owned ship, that it has to be built in the United States, all 
the component parts and everything else built in the United States, 
that it has to be American sailors that pay taxes in this country.
  I say some of that is good, but let me tell my colleagues what has 
happened to this bill as we have lost 60 percent of our fleet that goes 
from U.S. port to U.S. port in this country. We are forcing sailors out 
of jobs; we are forcing businesses out of business. I will give my 
colleagues a couple of examples.
  Right now in Michigan, wheat can be purchased from Canada, the same 
priced wheat, and shipped to other ports through the seaways at a 
cheaper price than they can buy it much closer in United States ports. 
I would like to get the gentleman from Maryland [Mr. Gilchrest] to give 
me the case, because I cannot remember what that was.
  Mr. GILCHREST. Mr. Speaker, I thank the gentleman for yielding. I am 
not going to take a position on the Jones Act, but what I would like to 
describe to the gentleman from Michigan is that there was a ship in 
Baltimore that was loading cargo, helicopters. One of the helicopter 
blades that was just loaded onto the ship fell and was damaged. The 
only place to replace those helicopter blades was in Jacksonville, FL.
  Now, the ship was a Norwegian-owned ship. The ship traveling from 
Baltimore to Florida could take on the new blade, but it could not 
exchange it for the old blade without a fairly significant fine, 
because of the Jones Act. We were able to work through this and 
mitigate that down, which is still in the process of being mitigated.
  I think in instances where one can exchange parts under those 
circumstances, that probably ought to be accomplished.
  Mr. SMITH of Michigan. Mr. Speaker, I thank the gentleman. The 
problem is, what we do in this bill is we keep everything else the 
same. We say it has to be an American crew, it has to come under all 
American laws, pay all U.S. taxes. It has to be American owned. But in 
the cases where an international company can build that ship much 
cheaper than they can build in this United States, allow that bid to 
happen. Let us buy American, but where it is unreasonably high and 
right now the United States in our shipbuilding ports are not 
interested in building those ships for the Jones trade. They turned 
down Walt Disney. You might have seen that. They turn down cruise 
ships. What this bill does is it says that at least some of those 
component parts, that ship can now be built in another country.
  If we want to expand our seaways and our ships, then I think we have 
to face up to the fact that we are losing jobs in this country.
  I yield to the gentleman from Colorado [Mr. Schaffer], who has worked 
a long time on this issue.
  Mr. BOB SCHAFFER of Colorado. Mr. Speaker, I thank the gentleman from 
Michigan for bringing this issue forward and for his leadership in the 
effort.
  In the conference that we had yesterday to announce the bill, of 
course we were joined by many people from the agriculture industry, as 
well as the steel industry, and many individuals, many industries 
represented that shipping and goods and services throughout the 
country, and the Jones agent, back in the 1920's is the age on this 
thing, was described as an act which increases the cost of goods and 
services to consumers.
  Now, I come from a State where we produce a lot of wheat, an awful 
lot of corn, a lot of cattle, and a lot of pork, and so on, and 
shipping is an incredibly important mode of transportation for these 
goods that need to get to market. The wheat farmers, as one example, in 
Colorado tell me that the cost of a bushel of wheat is increased by 
upward of $1 per bushel because of the regulatory impact of the Jones 
Act.
  I commend the gentleman from Michigan for bringing this issue 
forward. By deregulating this particular industry, we stand a chance of 
turning these numbers around, actually increasing the number of ships 
produced in the United States, the number of people employed in the 
industry by appealing to the benefits of the free market, and in the 
long run, reduce the cost for consumers throughout the country and 
strengthen our global and competitive position.
  Mr. SMITH of Michigan. I thank the gentleman very much.
  Mr. Speaker, if I can prove to my colleagues that we are going to end 
up with more American jobs, that our national security is going to be 
enhanced by the increased number of ships, will my colleagues support 
this bill? It is dramatic. Look at it, study it. I would suggest to my 
colleagues that we do not have this kind of requirement for our trucks, 
our trains, our airplanes or anything else.
  If we had done this to the American automobile industry and shut off 
any imports coming into this country, we would not have the quality of 
cars. Today, we have the highest quality, the best price, the best deal 
car in the world because there is competition.
  I would suggest to my colleagues, Mr. Speaker, that we have to face 
up to the fact that we have an antiquated law that needs to have 
competition brought into this industry. We are dropping the bill 
tonight.

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