The Jones Act is that little bit of US protectionism which says that not US owned, not US crewed and not US union rule recognising ships cannot operate either between US ports or in US waters.
And here we see some of the costs:
Four of the world’s largest oil companies are creating a strike force to stanch oil spills in the deep waters of the Gulf of Mexico in a billion-dollar bid to regain the confidence of the White House after BP PLC’s disaster.
Certainly, this isn’t a silly thing to be doing however:
The companies will evenly split an initial investment of $1 billion in the nonprofit venture, which they are calling the Marine Well Containment Co. But the tab to build the system and have crews on alert for years could run in the billions of dollars.
The containment system will be designed to deal with well blowouts and is expected to be ready within 18 months, Exxon said. The response team should be able to start mobilizing within 24 hours of an oil spill, and be fully in place within weeks, said Sara Ortwein, vice president of engineering for Exxon Mobil Development Co.
It is costly.
But what has this to do with the Jones Act?
Well, y’see, something much like this already exists, over here in Europe. Indeed, that European system, skimmers, barges, oil tankers able to scoop from the surface and so on, was offered to BP at the start of the Macondo crisis. But it couldn’t be used because of the Jones Act.
So, now we’ll have two such systems in place, one for Europe and one for the Gulf. And the expense of the second is clearly down to precisely and exactly the Jones Act.
All of this is to protect the 153 large ships that meet the Jones Act criteria. In just this, this alone, we see a cost of $6.5 million per ship.
About time for a little more free trade, don’t you think?