Friday, September 29, 2017

10 days of Jones Act waiver not enough for Puerto Rico

Puerto Rico devastated
Devastation in Puerto Rico

“Last week, Hurricane Maria made landfall in Puerto Rico with winds of 155 miles an hour, leaving the United States commonwealth on the brink of a humanitarian crisis. The storm left 80 percent of crop value destroyed, 60 percent of the island without water and almost the entire island without power, as seen in the nighttime satellite images” in the New York Times story, The Devastation in Puerto Rico, as Seen From Above.

The photos shows that “Though Hurricane Maria had dropped from a Category 5 to a Category 4 storm by the time it reached Puerto Rico, it was more than powerful enough to rip apart roads and strip trees as it cut a path across the island.”

That island, populated by US citizens, needs the equivalent of the post-WW II Marshall plan.

Jones Act update: 10 days not enough

Daniella Diaz updated her report at CNN: Trump authorizes waiver to loosen shipping regulations for Puerto Rico.

Washington (CNN)The White House has authorized a waiver to loosen shipping rules regarding Puerto Rico that island officials say would be a significant help for recovery efforts from Hurricane Maria.

“At @ricardorossello request, @POTUS has authorized the Jones Act be waived for Puerto Rico. It will go into effect immediately,” White House press secretary Sarah Sanders tweeted Thursday morning.

However, the waiver is in effect for just 10 days.

Acting Department of Homeland Security Secretary Elaine Duke said the waiver will be in effect for 10 days and will cover all products being shipped to Puerto Rico, according to a release from the department.

The waiver will guarantee the needed equipment to repair infrastructure damaged by the storm and restore emergency services, Duke said in a news release.

After the 10-day period, the waiver can be extended if needed, DHS spokesman David Lapan told CNN. He said the waiver was approved after it was determined that doing so was in the interest of national defense.

What the Jones Act is really about

Earlier Trump mentioned the shipping industry being opposed to lifting that outdated, onerous law.

A report at money.cnn.com explains: Puerto Rico crisis: What the Jones Act controversy is all about.

The Jones Act is an obscure, century-old law that requires all goods ferried between U.S. ports to be carried on ships built, owned and operated by Americans.

Now critics say it’s making it difficult to get critical supplies into Puerto Rico.

[Arizona Senator John] McCain and Democratic Representative Nydia M. Velázquez, as well as the governor of Puerto Rico and mayor of San Juan, have urged Trump to suspend the Jones Act to get supplies to Puerto Rico faster.

President Trump has not waived the rule, though he said Wednesday that he is “thinking about” it. He noted the shipping industry opposes a waiver.

“We have a lot of shippers and a lot of people that work in the shipping industry that don’t want the Jones Act lifted,” he told reporters.

As noted above, Trump finally did suspend the Jones Act but only for 10 days.

Critics say the Jones Act costs American jobs by encouraging residents in Puerto Rico, the U.S. Virgin Islands and Hawaii to buy foreign-made goods that are shipped on foreign flagged vessels, rather than goods made in America.

That’s what happens when it comes to gasoline and other fuels, said Tom Kloza, chief oil analyst for Oil Price Information Service.

“Puerto Rico typically gets most of its gas from foreign sources – Canada and Europe,” he said. “Jones Act ships are so expensive that it doesn’t make sense to buy gasoline from U.S. refineries.” So, Kloza said, a waiver of the Jones act won’t bring much more fuel to the island since Puerto Rico gets what it needs from other countries.

To be sure, suspension of the Jones Act would have limited impact on fuel in Puerto Rico. The huge problem, reported by Rachel Maddow last night, is that hundreds of containers of food and water and other necessities are sitting dockside as the bureaucracy struggles with the administrative problems of moving those supplies to the people.

So owhen you think about the Jones Act, you should be thinking of how to help Puerto Ricans in the long term. Here’s why.

… plenty of other things are much more expensive in Puerto Rico because of the Jones Act. Cars, for example, cost about 40% more in Puerto Rico than on U.S. mainland, partly because of the law. It also affects other necessities.

A 2010 study by the University of Puerto Rico found that the Jones Act cost the island $537 million per year. The territory has been in a recession for 11 years and is suffering from a crippling debt crisis.

Still, the American Maritime Partnership, a coalition representing the domestic shipping industry, argues that the act supports national defense needs and ensures a vibrant maritime industry.

So in the end it comes down to profits (for the shipping industry) taken at the expense of people (the economic hardship imposed by the Jones Act).

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