UPDATE: President Donald Trump on Aug. 10 extended the Jones Act waiver for another 90 days, effective Aug. 17. The narrower extension will subject foreign-vessel voyages to undergo case-by-case review and limit eligible cargoes to certain energy and agricultural products.
U.S. maritime industry leaders are pushing back against Michael Bloomberg’s call to repeal the Jones Act, arguing that the current wartime waiver has failed to deliver meaningful consumer savings while shifting domestic cargo movements to foreign-flag vessels.
Bloomberg, founder and majority owner of Bloomberg LP, argued in an Aug. 6 opinion column that the Iran war has demonstrated what U.S. commerce could look like with fewer Jones Act restrictions. He pointed to increased domestic petroleum shipments under the waiver, including Gulf Coast-to-West Coast movements, and called on Congress to repeal the law or relax its requirements.
Jennifer Carpenter, president of the American Maritime Partnership and president and CEO of the American Waterways Operators, called the shift to case-by-case review "an improvement over the previous blanket Jones Act waiver," but said AMP remains disappointed that the waiver was extended.
"The public record is clear: the waiver has not lowered fuel prices for American consumers and has been used to increase oil traders' margins, not meet military needs," Carpenter said. AMP urged the administration to conduct a rigorous review of the national defense justification and availability of U.S. vessels before approving individual waiver requests.
“This waiver's defenders can count the voyages. They cannot count the savings,” said Aaron Smith, president and CEO of the Offshore Marine Service Association. “The experiment has failed; outsourcing our jobs didn’t allow American families to pay less for fuel, and it is not a reason to keep American mariners on the beach.”
Smith said the industry has seen temporary waivers develop into longer-term exemptions before, with lasting effects on U.S.-flag operators and mariners.
“OMSA has been through these debates before,” he said. “For more than 50 years, we've seen one-time Jones Act waivers turn into near-permanent exemptions and create lasting consequences for the American maritime industry. Time and again, when foreign vessels replace U.S.-flag vessels, the harm to American mariners, businesses, and investment is hard to undo and often becomes permanent.”
INDUSTRY DISPUTES CONSUMER BENEFIT
Carpenter called the waiver a “solution in search of a problem” and disputed the argument that it has produced a meaningful benefit at the pump.
“The price of gas has not been affected in any material way by the Jones Act waiver,” Carpenter told WorkBoat.
She said the debate has shifted from predictions that allowing foreign vessels into domestic trades would lower fuel prices to arguments that the waiver has instead unlocked previously dormant waterborne cargo movements.
Carpenter also challenged Bloomberg’s use of the West Coast fuel market as evidence that the Jones Act suppresses domestic commerce. She said California’s declining refining capacity and its reliance on imported fuel raise broader questions about energy resilience, but argued that the state’s dependence on Asian suppliers cannot simply be attributed to the Jones Act.
“This whole experience has highlighted a need to kind of take a look at energy policies and say, wait a minute, are we really building into our system the resiliency that we need,” Carpenter said.
She noted that California’s geography can make imports from Asia more practical than moving fuel from the Gulf Coast through the Panama Canal.
FLEET NUMBERS SCRUTINIZED
Bloomberg also pointed to the Maritime Administration’s count of 92 Jones Act-eligible vessels among U.S.-flag, self-propelled, oceangoing merchant vessels of 1,000 gt or more, along with the small number of large commercial ships built annually in American yards.
Carpenter said the 92-vessel figure leaves out large portions of the domestic fleet.
“There’s 45,000 vessels in the domestic Jones Act fleet,” she said. “Many of them are tugboats, towboats, and barges.”
She said the figure also excludes articulated tug-barge units, which have played a major role in moving petroleum products and other cargoes in U.S. coastal trade.
“It’s kind of willful ignorance, I think, to cherry-pick small segments of the fleet and say, you know, and that's all there is, because it's not all there is,” Carpenter said.
The Trump administration has separately made rebuilding U.S. commercial shipbuilding a policy priority. Its Maritime Action Plan calls for increasing domestic shipbuilding capacity, attracting investment to U.S. yards, and strengthening the maritime workforce.
The industry, Carpenter said, sees a contradiction between those goals and continued use of the waiver.
She said industry representatives have told administration officials that efforts to expand the U.S.-flag fleet and stimulate vessel construction will be more difficult while foreign operators are being permitted to take domestic cargoes.
“If we're waiving the Jones Act and hollowing out our domestic maritime industry, it's just futile to talk about how are we going to stimulate the building of vessels in American shipyards to serve in the international trades,” Carpenter said.
JOBS AND NATIONAL SECURITY
Sara Fuentes, president of the Transportation Institute, a U.S. maritime industry association, said an extended waiver could have longer-term consequences for U.S. tanker and articulated tug-barge crews.
“Michael Bloomberg has been a long-time ideologue opposing the Jones Act, preferring a race to the bottom that hurts American workers and decreases the quality of service consumers enjoy,” Fuentes said. “We've seen Chinese and Russian crews taking work opportunities from American seafarers. That needs to end now.”
Fuentes cited an analysis prepared by PwC for the Transportation Institute that estimated a sustained waiver could expose as many as 133,700 U.S. jobs and $12.2 billion in annual labor income while putting up to $26.5 billion in domestic shipbuilding demand at risk over 10 years. The figures describe economic activity potentially exposed under the study’s long-term waiver scenario rather than a forecast that all of those jobs or investments would be lost.
Concerns over foreign participation have also surfaced in Congress. A June 30 letter led by Rep. James Comer, R-Ky., and signed by House Speaker Mike Johnson, R-La., House Majority Leader Steve Scalise, R-La., and other Republican lawmakers urged the administration to allow the waiver to expire Aug. 16. The lawmakers argued that foreign-flag vessels have operated under the waiver even when U.S.-flag capacity was available.
AWO has also highlighted the Chinese-flagged tanker Jin Zhou Wan and the Malta-flagged Pyxis Lamda, which operated with Russian officers, as examples of foreign vessels participating in domestic movements under the waiver.
Carpenter said those voyages raise questions that go beyond freight rates or fuel prices.
The waiver, she said, has “opened up Homeland Security vulnerabilities” while creating uncertainty for mariners and maritime companies considering future investment.
With the waiver now extended under a case-by-case review process, Carpenter said AMP wants the administration to closely scrutinize each request.
"AMP urges the Trump Administration to conduct a rigorous review of the national defense justification for each and every waiver request and to carefully assess the availability of U.S. vessels before allowing a foreign vessel to move cargo between U.S. ports," she said.
