Jones Act Inflates Caribbean Shipping Costs

- The Merchant Marine Act of 1920, or Jones Act, mandates that all goods shipped between U.S. ports be transported on vessels that are U.S.-built, U.S.-owned, and crewed by at least 75% American mariners. - A primary driver of the increased cost is the expense of American-built ships, which can cost up to four times more to build than their foreign-made counterparts. As of 2025, fewer than 100 vessels are compliant with the Jones Act. - An economic analysis calculated that the costs imposed by the Jones Act on Puerto Rico are equivalent to a 30.6% tariff, costing the island's economy an estimated $1.4 billion annually. This contributes to a cost of living that is 13% higher than on the U.S. mainland. - Proponents of the law argue it is vital for national security by maintaining a domestic shipbuilding industry and a pool of American mariners who can be drawn upon in times of war or national emergency. They also state the act supports nearly 650,000 American jobs and contributes $150 billion in annual economic impact. - The neighboring U.S. Virgin Islands are exempt from the Jones Act, providing a direct regional comparison for shipping logistics and costs without the Act's restrictions. - The act's limitations have been shown to slow disaster relief efforts; after Hurricane Maria, temporary waivers were required to allow foreign-flagged ships carrying aid to dock in Puerto Rico, a process that consumes valuable time. - In January 2024, Senator Mike Lee of Utah introduced the "Open America's Waters Act," which seeks a full repeal of the Jones Act's requirements to increase competition and lower costs. - The Jones Act fleet lacks certain types of vessels, such as oceangoing dry bulk ships and Liquefied Natural Gas (LNG) tankers, which restricts how certain commodities can be shipped from the U.S. mainland.