COUNTERPOINT: A 100-year-old shipping law is driving up costs for Americans

The Trump administration's recent decision to issue a 60-day waiver of the Jones Act - extended just last week by an additional 90 days - amid the continuing conflict in the Middle East was a recognition of a simple reality: When it matters most, the law restricts the efficient movement of critical resources.

That reality extends far beyond moments like this. American families are facing an affordability crisis. In a recent Politico poll, nearly half of Americans say they struggle to afford basic necessities such as groceries, utility bills, healthcare, housing and transportation.

While many factors contribute to rising costs, the Jones Act is one of the most persistent and overlooked drivers.

The law restricts shipping between U.S. ports, driving up energy and other costs. That reality is not theoretical - it is underscored by the administration's recent waiver to "allow vital resources like oil, natural gas, fertilizer and coal to flow freely to U.S. ports," according to the White House.

That kind of temporary relief is not enough. High energy costs have been a financial burden even before the U.S.-Iran engagement. President Donald Trump's decision to waive the law reflects a recognition that policies that strengthen American competitiveness can deliver real benefits. If the United States is serious about energy dominance, American energy should be able to move freely to American consumers - not be constrained by outdated shipping restrictions. Congress should repeal the Jones Act.

Passed in 1920, the Jones Act requires that all goods transported between U.S. ports be carried on vessels built in the United States, registered under the U.S. flag, and owned and crewed by Americans. On paper, the law was supposed to protect domestic shipbuilding. In reality, it has not delivered on that goal - all while quietly raising the prices of essentials such as food and fuel.

By limiting the number of vessels allowed to operate between U.S. ports, the Jones Act drives up shipping costs. With so few compliant ships, rates on Jones Act routes can in some cases reach several times - and in extreme cases, up to 10 times - those of foreign vessels.

Shipping is a foundational input into nearly every good that Americans consume, meaning higher shipping prices ultimately translate into higher prices at the gas pump and on store shelves. A U.S. International Trade Commission analysis has compared the Jones Act's effects to a significant implicit tariff on domestic shipping.

Supporters of the Jones Act often argue that it is necessary for national security, helping sustain a domestic shipbuilding base and merchant fleet. In practice, however, the law has coincided with a shrinking number of U.S.-flagged vessels and higher costs that limit flexibility in times of crisis - outcomes that raise questions about whether it is achieving its intended purpose.

Nowhere are these costs more visible than in energy markets. The United States has no Jones Act-eligible liquefied natural gas tankers serving U.S. domestic routes, leaving regions like New England reliant on imported fuel, including shipments from Trinidad and Tobago, even though abundant domestic supplies are closer. One analysis found that repealing the Jones Act could save consumers $769 million annually in petroleum shipping costs.

The burden is even heavier in noncontiguous states and territories. One study estimates that the Jones Act imposes $1.4 billion in annual welfare costs on Puerto Rico, with consumers bearing about $692 million of that cost.

Hawaii has the highest energy costs in the nation, with electricity prices often more than double the national average. A study from the Grassroot Institute of Hawaii estimates that Hawaiian families pay an extra $1,800 annually for basic goods, including housing, food and gas, all because of the Jones Act.

Congress can fix this by repealing the Jones Act and its distortion of the marketplace.

The affordability crisis confronting Americans today is not driven by a single policy. However, the Jones Act is a clear and fixable contributor, one that raises costs, reduces efficiency, and fails to deliver on its promises.

Repealing or reforming the Jones Act would not solve every affordability challenge overnight. It would lower costs, strengthen energy security, and make American supply chains more efficient.

In an economy where every dollar matters, that's a practical step Congress should take.

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ABOUT THE WRITER

Katelyn Bledsoe is the vice president of external affairs at Americans for Prosperity. She wrote this for InsideSources.com.

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This story was originally published May 7, 2026 at 4:09 AM.