[Congressional Record Volume 145, Number 69 (Thursday, May 13, 1999)]
[Senate]
[Pages S5268-S5274]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. BROWNBACK (for himself, Mr. Helms, Mr. Burns, Mr. Roberts, 
        Mr. Fitzgerald, and Mr. Lugar):
  S. 1032. A bill to permit ships built in foreign countries to engage 
in coastwise trade in the transport of certain products; to the 
Committee on Commerce, Science, and Transportation.


                    freedom to transport act of 1999

 Mr. BROWNBACK. Mr. President, today I am reintroducing 
legislation that will expand capacity and increase competition within 
the domestic transportation system. This legislation, which will allow 
foreign built ships to transport bulk commodities, forest products, and 
livestock between U.S. ports, will help to expand the overall capacity 
by allowing ship operators to expand their fleets through obtaining 
affordable ships.
  Currently, Section 27 of the Merchant Marine Act of 1920, commonly 
referred to as the Jones Act, requires that merchandise being 
transported on water between U.S. ports travel on U.S. built, U.S. 
flagged, and U.S. citizen owned vessels that are documented by the 
Coast Guard for such carriage. The bill I am introducing today, The 
Freedom to Transport Act of 1999, does not seek to repeal the Jones 
Act. Rather, it provides very targeted modification--to allow foreign 
built ships to carry bulk cargo in domestic trade. These ships would 
have to register in the United States and comply with all U.S. laws, 
including Jones Act ownership and crewing requirements.
  The current law makes it infeasible for domestic coastwise shipments 
of agricultural commodities to occur on bulk shipping vessels. This is 
largely because the cost of purchasing a ship in the United States is 
as much as three times higher than it can be obtained on the world 
market. As a result, there has been little capital infusion into the 
domestic Jones Act fleet for many years. As a consequence, the cost of 
transport on bulk Jones Act vessels, if they are available at all, is 
prohibitively high.
  Agriculture is a pillar to the Kansas economy, and an efficient 
transportation is critical to American agriculture. Laws that raise the 
cost of conducting business and impede efficient means for transporting 
product have a negative impact on farmers around the country, including 
Kansas. Moreover, the cost of transporting

[[Page S5274]]

goods is always a proportionately high cost of the delivered product 
for bulk commodities, but especially now as grain prices are at the 
lowest levels seen in years. Having means to the most cost-effective 
and efficient means for transporting product is now, more than ever, 
critical to American farmers.
  If ocean transportation between U.S. ports were more efficient, more 
product might be delivered to its destination by ocean rather than by 
rail. For example, the poultry and pork producers in the grain deficit 
southeastern United States could bring in grain by ocean through the 
Great Lakes rather than by across the country by railroad. Since little 
of this type of trade currently occurs, this could have the effect of 
increasing the overall capacity of the domestic 
transportation infrastructure. That would make more railcars available 
for transport in places like Kansas, particularly during the harvest 
season when there is often a shortage of available cars. Furthermore, 
more efficient coastwise transportation would bring down prices for 
trade to Hawaii, Puerto Rico, and Alaska, which oftentimes find it less 
expensive to purchase products from other countries than to pay the 
inflated costs of shipping from the mainland U.S.

  I am aware that the maritime industry has supported the Jones Act as 
a protection of domestic industry for many years, and resists any 
change to the current law. However, despite the ``protective'' nature 
of the Jones Act, it has protected very little. In the last 50 years 
the merchant marine has lost 40,000 jobs and over 60 shipyards have 
closed since 1987. In my view this legislation would not only benefit 
the customers of transportation services, but would also inject new 
life into an industry that has missed out on the unprecedented growth 
that the rest of the economy has enjoyed in the last generation. I want 
to work with the maritime industry to address their concerns and look 
forward to their eventual support of this legislation, which I envision 
will help them as much as it will help agricultural shippers.
  I would like to point out that the legislation as introduced enjoys 
broad support not only in the agriculture industry, but also among many 
industries that ship bulk commodities--including oil, coal, clay, and 
steel. Additionally, those engaged in commerce with the non-contiguous 
U.S. are supportive, including the Puerto Rico Manufacturers 
Association, the Hawaii Shippers Council, and the Alaska Jones Act 
Reform Coalition. Finally, the National Taxpayers Union and Americans 
for Tax Reform support this as a measure that would save consumers over 
$14 billion annually.
  A healthy maritime industry increases competitiveness, lowers costs, 
and improves service for customers of transportation. It creates jobs 
in the U.S. not only for the people who crew the ships, but for those 
who repair them, who own them, and who are employed by industries who 
buy transportation services. It is a win-win-win-win proposal.
  I hope my colleagues will join me in reducing stifling government 
regulation and support this important bill.
                                 ______