Vincent Smith and Shantanu Kamat explore the impact of a significant federal regulatory waiver.
The Jones Act, which restricts cargo shipments between US ports to US-flagged and owned vessels, has distorted the US transportation system for over a century. …
… When the Trump administration issued a Jones Act waiver on March 17, 2026—the longest since 1950—it created a “natural experiment” that allows us to gauge the law’s effects. The waiver, initially for 60 days and subsequently extended by 90 more, covers over 650 product categories (including natural gas, crude oil, and jet and other fuels) and gives commercial shippers enough time to respond to a regulatory environment in which they can commission domestic cargo shipments on foreign-flagged vessels.
While current Jones Act freight rate data are not available, there is other evidence that suspending the law has improved the efficiency of US shipping. Scott Lincicome has reported that, contrary to fears that the services of the small Jones Act fleet would be displaced, foreign shipping has simply added to the carrying capacity available to move goods between US ports. This indicates that the Jones Act has imposed significant constraints on the supply of commercial shipping. The corollary is that for most of the past century, freight rate premiums for Jones Act shipments have been substantial, with concomitant impacts on prices for many products.
Removing Jones Act restrictions has also allowed energy companies to adjust to market conditions, as Colin Grabow has reported. …
… Some Jones Act supporters have argued that Jones Act reform would benefit shipping and military interests in countries such as China and Russia. MARAD reports belie that notion. As of May 11, no Jones Act waiver shipments have involved Chinese or Russian-flagged vessels (Figure 2), nor are adversarial nations represented among the ship owners or operators. Instead, the United States, Singapore, Japan, and Switzerland top that list.
