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Lower Inflation by Repealing the Jones Act

Waive the Jones Act to Get the Supply Chain Flowing Again

By Kevin Hassett and Timothy Fitzgerald

When we were in the Trump administration at the Council of Economic Advisers, a polar vortex struck New England. Our staff estimated that the cold forced Americans to spend hundreds of millions of dollars more on natural gas from other countries. How could the US be a net exporter of gas and also a hostage to foreign countries like Russia in a cold winter?

The answer, we found, is the Merchant Marine Act of 1920, also known as the Jones Act, which requires that ships operating between ports in the US be constructed in the US. No ships capable of transporting liquid natural gas were built in the US, so New England, reliant on shipping for its energy because of the absence of pipelines, couldn’t buy gas from US suppliers. Foreign vessels can bring gas from Trinidad to Boston, but not from any US port.

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