Intended to maintain a strong domestic maritime industry, the Jones Act requires goods shipped between American ports to be transported on vessels that are built, owned, flagged, and crewed by the U.S. No other comparably stringent regulations exist for other means of transportation.
Press Secretary Karoline Leavitt previously stated, “In the interest of national defense, the White House is considering waiving the Jones Act for a limited period of time to ensure vital energy products and agricultural necessities are flowing freely to U.S. ports.” Ironic that the very law imposed for national interest must be waived for national interest.
But it also begs the question: If waiving the act will reduce prices at the pump (and on other goods), why are we keeping a statute that raises them in the first place?
Restricting U.S. and inland waterways transportation to solely U.S.-built and -run ships artificially inflates the costs of moving cargo by water by protecting them from foreign competition. The Department of Transportation estimates operating a Jones-Act-compliant vessel is twice as expensive as the alternative; a U.S. Maritime Administration study pegs it closer to triple the cost.
American-made ships tend to cost between $190 and $250 million; a similar vessel in a foreign shipyard is about $30 million. At that price tag, U.S. shippers buy fewer ships, and therefore, U.S. shipyards build fewer of them. Only 93 Jones-Act compliant ships are in use today, and the dwindling fleet is aging.
The Jones Act also increases traffic congestion, noted Daniel Savickas of the Taxpayers Protection Alliance:
Federal policy has also exacerbated traffic congestion on I-95’s northeast corridor and deprived motorists of alternate routes. The Jones Act – one of America’s most nefarious laws – restricts domestic water commerce to ships that are built, registered, and owned in the United States. This creates very few options for travel between American ports.
In February, the Cato Institute conducted a study, analyzing the Jones Act’s impact on Northeastern traffic. They found the region to be home of six of the ten most congested roads in America and two of the five most congested cities in the world. A large part of this is because of the sheer volume of truckers moving freight on these northeastern highways, and – as any motorist knows – driving more slowly than the average highway traveler.
Shipping between American ports would be more efficient because ships can carry more in single trips. It would also be more environmentally friendly, given the emissions savings that would emerge from the resulting efficiency. However, protectionists and maritime shipping unions have prevented this law from being taken off the books for over a hundred years. We are now seeing the costs more clearly. It has strained the highways and left many without alternatives when disaster occurs.
“The Jones Act is a failure,” says the National Review:
If the Jones Act is so essential for the United States to respond to wars and national emergencies, one would assume it wouldn’t be waived when there are wars or national emergencies.
The obvious problem is that the Jones Act, by design, restricts the transport of critical goods across the country. When Puerto Rico needs fuel after its electric grid has been smashed, or when regular shipping patterns are disrupted by conflict, the law prevents the vast majority of the world’s vessels from moving needed supplies from one part of America to another.
But the Jones Act was supposed to secure a reliable supply of U.S.-built and manned ships to help in a crisis. Where are all those vessels?
It turns out there aren’t that many of them. As of 2024, the country boasts just 92 ships that comply with the Jones Act. Another 93 ships carry the American flag and are crewed by U.S. citizens, but they were built in foreign countries. Those ships are free to move cargo between Los Angeles and Shanghai, but not between New York and Miami.
Energy supplies are especially vulnerable to the law because they depend on even scarcer tanker ships. Colin Grabow of the Cato Institute notes, “Of nearly 7,500 oil tankers worldwide, just 54 comply with the Jones Act. Of those, only 43 are product tankers suited to transporting refined fuels,” such as gasoline and diesel.
Such a limited fleet means that Jones Act–compliant ships are often unable to respond to major disruptions or emergencies. Foreign-built and operated ships could fill the gap, but they are barred from doing so without a waiver. Rational presidents are usually persuaded to buck the powerful maritime lobby and suspend the law once a crisis becomes acute.
