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Repealing the Jones Act would be good, but would not result in more US shipbuilding. It would just mean that ships meant for routes between US ports would be bu

Repealing the Jones Act would be good, but would not result in more US shipbuilding. It would just mean that ships meant for routes between US ports would be built in more competitive Japanese, Korean, and Chinese shipyards. There is nothing within the Jones Act itself that currently prevents an innovative and enterprising American entrepreneur from building ships at a lower cost.

eru 3y ago
> There is nothing within the Jones Act itself that currently prevents an innovative and enterprising American entrepreneur from building ships at a lower cost. There is. Without the Jones Act an innovative and enterprising American entrepreneur could build ships partially or wholly outside the US. She could sell them to a re-invigorated domestic shipping industry. The re-invigoration coming from (1) lowered costs by being allowed to hire foreigners, (2) lower cost of capital, because foreign ownership is allowed, and (3) from the foreign competition spurring on productivity improvements. A repeal of the Jones act would lower the costs of our American ship building entrepreneur directly, and increase demand for her products, by lowering the costs of her customers.
- missedthecue 3y ago
  Yes but we're not talking about that. Everyone already knows foreign shipyards are very competitive. We are talking about why domestic shipyards aren't, and the Jones Act isn't to blame for it.
  - eru 3y ago
    The Jones act still is for the reasons I outlined. It shelters them from competition, and it also outlaws partial outsourcing, too. At a hypothetical example, consider if Thailand passed the equivalent of the Jones act but for computers. At the moment, Thailand produces a lot of hard disks. There are used all over the world, but also in Thai computers. With protectionism in place, Thailand would produce some complete computers for domestic use. But they would be just as abysmal and expensive as American ships. The overall size of the industry would likely be smaller than just the hard disk branch alone was. (This example worked better before SSD were widespread.) In the real world right now, a Thai entrepreneur can start building computers easily, because she's allowed to source parts from anywhere around the world. And Thai computer users are allowed to let foreigners service their computers, too.

eru 3y ago

> There is nothing within the Jones Act itself that currently prevents an innovative and enterprising American entrepreneur from building ships at a lower cost. There is. Without the Jones Act an innovative and enterprising American entrepreneur could build ships partially or wholly outside the US. She could sell them to a re-invigorated domestic shipping industry. The re-invigoration coming from (1) lowered costs by being allowed to hire foreigners, (2) lower cost of capital, because foreign ownership is allowed, and (3) from the foreign competition spurring on productivity improvements. A repeal of the Jones act would lower the costs of our American ship building entrepreneur directly, and increase demand for her products, by lowering the costs of her customers.

missedthecue 3y ago
Yes but we're not talking about that. Everyone already knows foreign shipyards are very competitive. We are talking about why domestic shipyards aren't, and the Jones Act isn't to blame for it.
- eru 3y ago
  The Jones act still is for the reasons I outlined. It shelters them from competition, and it also outlaws partial outsourcing, too. At a hypothetical example, consider if Thailand passed the equivalent of the Jones act but for computers. At the moment, Thailand produces a lot of hard disks. There are used all over the world, but also in Thai computers. With protectionism in place, Thailand would produce some complete computers for domestic use. But they would be just as abysmal and expensive as American ships. The overall size of the industry would likely be smaller than just the hard disk branch alone was. (This example worked better before SSD were widespread.) In the real world right now, a Thai entrepreneur can start building computers easily, because she's allowed to source parts from anywhere around the world. And Thai computer users are allowed to let foreigners service their computers, too.