Government Aggravated Tragedy

This is not the first time that Washington's catering to shipping interests produced disaster for our country. Congress enacted the Navigation Act of 1817 providing, "that no goods, wares, or merchandise shall be imported under penalty of forfeiture thereof, from one port in the United States to another port in the United States, in a vessel belonging wholly or in part to a subject of any foreign power." Since the South was the nation's major exporter, Northern protectionist measures went a long way toward setting up the grievances that ultimately led to secession and the War of 1861.

Have you wondered why a foreign cruise ship can take you from Anchorage, Alaska to Vancouver, British Columbia but not to a more convenient U.S. port such as Seattle? You can blame it on a law very similar to the Jones Act. That's the Passenger Vessel Services Act (PVSA) of 1886 (46 U.S.C. 289) states that "no foreign vessel shall transport passengers between ports or places in the United States, under penalty of $200 for each passenger so transported or landed." PVSA is simply a protectionist law to spare American ships from international competition. PVSA permits American shipping companies to financially rip off their shipping and passenger customers by charging prices that would be otherwise unsustainable without the law.

The bottom line lesson is nothing good can come from trade restrictions except windfall gains by a small group of beneficiaries, shipping companies and their unions that come at the expense of a much larger number of people -- customers who ship and passengers who travel. The only good news is that the Gulf disaster is making the victims of such restrictions visible.

Walter E. Williams is a professor of economics at George Mason University. To find out more about Walter E. Williams and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate Web page at www.creators.com.

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