Shipbuilders: McCain amendment would "gut" industry

The shipbuilding industry, Mississippi's largest private employer, is warning that an amendment Sen. John McCain filed last week to the Keystone XL pipeline bill could do serious damage.

The language in McCain's amendment removes the requirement that vessels that operate exclusively in American waters be built in the U.S. The mandate is part of the Jones Act, also known as the Merchant Marine Act, which Congress passed in 1920. Beyond U.S. construction, the law also requires that ships subject to it be American-owned and crewed by U.S. citizens or permanent residents.

Senators could vote on McCain's amendment this week. In a press release, McCain called the Jones Act "an antiquated law that has for too long hindered free trade, made U.S. industry less competitive and raised prices for consumers." McCain's said a U.S.-flagged ship could carry crude oil from the Gulf Coast to a Northeastern U.S. refinery for $6 per barrel. A foreign-flagged ship could do the same for $2 per barrel, McCain said.

Shipbuilding advocacy groups say it would sink shipyards, including those on the Mississippi Gulf Coast.

According to the U.S. Maritime Administration, shipbuilding represents 23,450 jobs in Mississippi. The industry's economic impact to the state's GDP is $2 billion, figures from the American Maritime Partnership show.

"The McCain amendment would gut the nation's shipbuilding capacity, outsource our U.S. Naval shipbuilding to foreign builders and cost hundreds of thousands of family-wage jobs across this country," said AMP chairman Tom Allegretti. "The shipbuilding requirement, which Sen. McCain seeks to eliminate, is in place to ensure that the United States maintains the industrial capacity to build its own ships, to protect and defend the American homeland. It is hard to believe that Congress would endorse a change to the law that would outsource U.S. jobs and reduce national security by effectively creating dependence on foreign countries to build our ships."

Sen. Roger Wicker said in a statement that he would oppose McCain's amendment when it comes to a vote. He called the Jones Act "a law with longstanding bipartisan support. Changing the law would negatively impact shipbuilding in Mississippi and across the country. This industry provides thousands of jobs and plays a crucial role in our commerce and national defense."

Sen. Thad Cochran will vote against McCain's amendment, too. He said in his own statement that "preserving our nation's shipbuilding capabilities is important, and it would be a mistake to implement such a sweeping change without hearings and a thorough examination of the consequences."

Steven Palazzo, a Republican from Biloxi whose district includes Ingalls Shipbuilding, was one of 32 representatives from both parties to sign a letter urging the Senate to defeat the measure.



This isn't the first time free-trade legislation from McCain has riled a major Mississippi industry. In 2011, he advocated for the rollback of a USDA program that inspected fish imported from Vietnam and China for pollutants. The fish were often labeled as catfish in grocery stores. U.S. catfish farmers, including those in the Mississippi Delta, said that presented a public health risk and put them at a competitive disadvantage. In a floor speech, McCain accused his colleagues, including Cochran and Wicker, who opposed him of "serving the special interest of the catfish industry in their state." McCain was unsuccessful, and the inspections remain in place.

Contact Clay Chandler at (601) 961-7264 or cchandler@jackson.gannett.com. Follow @claychand on Twitter.