 Oh, hello! I didn't see you there because I'm in a video. I'm just out driving my foreign-owned boat ship. But not between American ports, because of a little thing called the Jones Act. A hundred-year-old protectionist law that makes traffic worse and stuff more expensive. Not to be confused with the Davy Jones Act, which requires that all haunted pirates live on the floor of the ocean, or the Alex Jones Act, which requires everyone to wear protective headfoil when discussing frog genders. No, the Jones Act requires that any vessel sailing between American ports must be American-built, American-owned, manned by an American crew flying the American flag. If your ship has a maple leaf on it, or a falcon strangling an eel, or whatever this guy's up to, you cannot go between American ports to sell us cheap stuff from your country, or even transport stuff from our country to other parts of our country. The Jones Act regulates cabotage, which, prior to this video, I assumed was some kind of floating cabbage. But it turns out no. Cabotage is the act of shipping goods between two ports within the same country. So if you want to sail from Denver to Las Vegas on a foreign ship, you'd be a moron, because the Jones Act restricts cabotage to American vessels. By limiting which ships can schlep stuff in between our ports, it makes shipping more expensive, which makes stuff more expensive. Particularly for places like Hawaii, Puerto Rico, Guam, or any new floaty states I haven't got around to learning about yet. The Jones Act exists under the pretense of national defense, because of Germans. During World War I, European commercial ships normally used to transport pop hats and lobbing them to feed hungry Americans, not got yanked out from our shipping lanes to assist the war effort. Those ships were stuck in Europe, ferrying bayonets and nunchucks back and forth, trying to kill evil Archduke Franz Ferdinand. Don't worry, we got him. After the war, the United States got worried that a global interconnected economy, like the one we currently enjoy, which has lifted billions out of poverty, would mean having to rely on foreign ships, which might suddenly skip out on commercial shipping during the inevitable return of a zombie Franz Ferdinand. Yet, American politicians fretted that the next time we went to a war on a distant continent, we might not have enough ships to transport cannons or horses or horse cannons. We needed to figure out a way to ensure we had enough American ships to get in on that horse war. So, we passed the Jones Act in 1920, forbidding foreign ships from operating between our ports. It's the economic equivalent of saying, Jiffy Lube closed once, so we'd all better learn how to change our own oil. So let's pay in Jiffy Lube, in case it closes again. The Jones Act and the little tweaks we've added to it over the years is rife with protectionism. When American-owned ships are repaired, only 10% of the steel can be foreign. 90% of that steel better be from the United States. Foreign steel is too flimsy and too foreign. It's basically shiny cheese. Protectionism has a big problem, though. It doesn't work. By outlawing foreign ships from cabotage, the Jones Act limits the amount of available ships, which drives up the cost of shipping. Climbing up the cost of shipping makes shipping more expensive. That would be the supply of law and demand. With less demand for shipping, shipping companies purchase fewer vessels, which means fewer boats next time we go to war with Zombie Horse, France for a demand. The Jones Act not only requires that vessels undergoing cabotage be American-owned, it also requires that they be American-made, which means if you want to fly old stripy on your boat, that freighter better be built in the United States. American-built coastal and feeder ships cost between $190 million and $250 million, whereas the cost of a similar vessel of a foreign shipyard is only $30 million. So the American companies, which the Jones Act theoretically wants to call upon next time we go to horse war, can only buy one American ship instead of eight foreign ships. Just a friendly reminder, ships are inanimate objects and it doesn't matter where they're built. They don't have accents or passports or souls. All things being equally floating buy the ship that's cheapest and hoist a flag of your choice. In the United States, where we restrict cabotage, only 2% of our freight travels by sea, whereas in the European Union, where member states can freely engage in cabotage between them, or as they call it, cabotage au toit, 40% of freighting is done by ship. Instead, because we've made shipping more costly, we rely on trucks, which are more expensive and carbon-intensive than ships. Also, I don't know about you. We have never been stuck behind a steamship on I-95 before. The Jones Act exists to try to expand our shipping capacity and make us self-reliant, unlike the Nora Jones Act, which is the soundtrack I cry to in the bathtub. Anyway, we're a net exporter of natural gas, and yet in 2019, because there weren't enough pipes to transport natural gas from southern states to Massachusetts, nor enough Jones Act-compliant vessels to do so, Massachusetts had to import it from Russia. Whenever we have a crisis, the United States government temporarily resends the Jones Act so that shippers can cheaply and quickly get food and materials and lob them into the affected area. Then, when the crisis recedes, we reinstate it. The reason that stopping the Jones Act works during these times is because, follow me here, the Jones Act doesn't work. So why not permanently scrap it? Well, that's because of lobbyists. That's why. Lobbyists! According to a 2019 study by the OECD, the U.S. economic gains would be somewhere between $19 billion and $64 billion. Now, I realized that $64 billion isn't even worth a senator getting out of bed for anymore, but somebody has to keep an eye on the pocket change. Given that the Jones Act counter-productively shrinks our shipping capacity and merchant-mariner fleet makes life more expensive for islanders and is directly and obviously harmful every single time we have a hurricane or Godzilla attack, in that time we scrap it.