Most Americans have never heard of the Jones Act, which is a protectionist law that has been on the books for over 100 years with the intent to protect U.S. based shipping and shipbuilding, put in place after World War I. As with many U.S. laws, it has backfired on the American people and business, with higher costs to consumers for their goods and energy. I argue that government should just get out of the way and let the free market run, which benefits both consumers and business.
Now, the Trump administration has extended its 90-day waiver of the Jones Act, allowing foreign-flagged shipping vessels to transport fuel and energy commodities between U.S. ports (The Hindu). This 90-day waiver exposes the reality that the Jones Act helps to lower energy costs for Americans and helps to prevent economic bottlenecks, confirming my assertion to let the free market run.
In 1920, the Merchant Marine Act (the “Jones Act”) mandated that all commercial cargo moving between U.S. ports must travel strictly on ships built, flagged, owned, and crewed by U.S. citizens.
For over a century, this federal trade barrier has distorted domestic markets in three major ways:
Artificially Inflating Consumer Prices: By eliminating foreign competition in domestic shipping, the Jones Act drives up freight rates dramatically. Taxpayers pay higher prices for gasoline, building materials, agricultural goods, and everyday groceries.
Punishing Coastal States and Territories: Non-contiguous states and territories like Hawaii, Alaska, and Puerto Rico—along with coastal states like Florida and New England—bear the heaviest burden, paying exorbitant transport premiums to move domestic goods.
Decimating the Fleet It Claimed to Protect: Far from creating a booming domestic shipbuilding industry, protectionism has made U.S. ships so expensive to construct and operate that the domestic merchant fleet has shrunk to historical lows.
The free-market approach to trade requires ending central-planning trade bans:
Permanent Repeal, Not Presidential Waivers: Managing economic bottlenecks through temporary executive exemptions grants Washington arbitrary discretion over who can trade. Congress must permanently repeal the Jones Act.
Embrace Global Competition: Allowing competitive global shipping operators to transport goods between domestic ports lowers energy transport costs, stabilizes supply chains, and reduces prices for American households.
End Crony Privileges: Free markets function best when government stops granting monopoly protection to favored industries at the expense of 330 million consumers.
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