The Jones Act is the bedrock foundation of the U.S. Merchant Marine.
It requires that ships calling in consecutive ports in the United States be American-crewed, American-owned, and American-made. The name comes from the original sponsor of the legislation, Senator Wesley Jones of Washington, and the actual law is called the Merchant Marine Act of 1920. This federal law, along with related cabotage laws, ensures that companies engaging in domestic trades or services compete equally and are fully subject to U.S. laws and regulations.
Just as the American Merchant Marine pre-dates the Republic, the Jones Act is itself pre-dated by numerous U.S. cabotage laws established at the founding of the nation, under the First Congress of the United States. It is not too much of a stretch to say that American shipping as an American right and principle was elemental to the idea of the new nation. But the Jones Act is more than words in an old law. It is instead a way of life that is built into the social, commercial, political, and national defense infrastructure of the American maritime scene.
In 2020, supporters of the Jones Act celebrated it's 100th year of continuous existence in part with recognition that it remains current and critical to our national security and properity.
There were a number of detailed studies released including the following:
In July of 2020, a serious scholarly study entitled "The Impact of the Jones Act on Hawaii" was released that debunked the oft repeated Jones Act criticism that it drives up prices for Hawaii. The economists behind the comprehensive research determined that retail prices were only slightly higher in Hawaii over mainland prices for the same items and there were many factors beyond the Jones Act that accounted for the difference.
In October of 2020, an important strategic analysis was released that freshened the global importance of the Jones Act as a matter of military readiness. Entitled United States Navy League Study on Global Maritime Competition and the Jones Act it also highlight the efforts of the Chinese and others to expand their influence and control over the sea lanes to the detriment of American businesses and consumers. An introductory excerpt reads "The importance of a strong American commercial maritime industry has been a constant throughout our nation’s history. Laws, policy and practices have been instituted since the earliest days of our country to keep U.S. waters more secure. The case for laws like the Jones Act, the fundamental law of the American domestic maritime industry, has only gotten stronger as rivals like China have publicly built their strategies for global power around control of the maritime sector..."
As noted above, the Jones Act is an anchor for U.S. economic and national and homeland security interests, and requires the transportation of merchandise between two U.S. points to be carried out by American-built, -flagged, -owned, and -crewed vessels.
Supported by broad bipartisan majorities in Congress and top U.S. national defense officials, the law facilitates a strong and vibrant domestic American maritime industry, which helps ensure the United States maintains its expertise in shipbuilding and waterborne transportation. The U.S. Navy’s position is clear – repeal of the Jones Act would “hamper [America’s] ability to meet strategic sealift requirements and Navy shipbuilding.”
Moreover, the Jones Act ensures that the vessels navigating our coastal and inland waterways are subject to U.S. laws and operate under the oversight of the U.S. government. As was noted by the Lexington Institute in a 2011 report, “Were the Jones Act not in existence, [the Department of Homeland Security] would be confronted by the difficult and very costly task of monitoring, regulating, and overseeing all foreign-controlled, foreign-crewed vessels in internal U.S. waters.”
The Jones Act sustains nearly 650,000 American jobs across all 50 states and annually contributing $154 billion to the nation’s economy. An impressive five indirect jobs are created for every one direct domestic maritime job, which results in more than $41 billion in labor compensation.
More than 40,000 American vessels, built in American shipyards, crewed by American mariners, and owned by American companies, comprise this domestic fleet. They move nearly one billion tons of cargo annually – or roughly a quarter of the nation’s freight – along U.S. internal waterways, across the Great Lakes, and over the oceans to Hawaii, Alaska, and Puerto Rico. Shipped goods include a variety of products, from raw materials and commodities like coal and crude oil to consumer products that fill the grocery store shelves nationwide.
As a result, the domestic American maritime industry plays an important role in relieving congestion on the nation’s crowded roads and railways, offering one of the most efficient and economical means of transportation in the world. American carriers have proven to be some of the most creative and innovative in the world, building the first in the world self-unloading bulk vessels, articulated tug-barges, and LNG-powered containerships. American ingenuity also created containerization, which changed global commerce.