July 21, 2017 | Industry Insights

Repeal of the Jones Act Introduced in the Senate

Share This:
Featured Image

Senator and once-Presidential candidate John McCain has introduced the Open America’s Waters Act of 2017, which would repeal the Merchant Marine Act of 1920, known as the Jones Act. The Jones Act requires that all goods shipped between ports in the United States be transported on American-built ships that are owned and operated by Americans. Nearly 100 years ago, it was intended to strengthen national security and commerce.

However, now these regulations are limiting the number of vessels available for shipping, and contributing to the growing cost of maritime transportation for the United States. For example, according to a report by the Energy Information Administration, approximately only ten tankers are used for the shipping of crude oil from Alaska to the West Coast. In addition, the increased cost can also be found in the vessels themselves. A report by the Congressional Research Service in 2014 found that the cost of an American medium range product tanker is over three times the worldwide price of the same vessel. The operating cost for American flagged vessels is almost 2.7 times more than their foreign flagged competitors. This increases the cost of expanding the supply of vessels in the market, creating an inability to meet demand, and ultimately a higher cost of transportation.

Senator McCain has said, “I have long advocated the repeal of the Jones Act, an archaic and burdensome law that hinders free trade, stifles the economy, and ultimately harms consumers. My legislation would eliminate this regulation, freeing American shippers from the requirement that they act against their own business interests.”

Indeed Senator McCain has tried to reform and repeal the Act several times, including two attempts in the last 18 months. In January 2016, he introduced an amendment to an energy modernization bill that would have waived the U.S. build requirement for oil and gas tankers. In 2015, he attempted to attach a similar amendment to a Keystone XL pipeline bill, looking to eliminate the U.S.-build requirement of the Jones Act.

McCain has said that in allowing “U.S. shippers to purchase affordable foreign-made carriers, this legislation would reduce shipping costs, make American farmers and businesses more competitive in the global marketplace, and bring down the cost of goods and services for American consumers.”

“The protectionist mentality embodied by the Jones Act directly contradicts the lessons we have learned about the benefits of a free and open market. Free trade expands economic growth, creates jobs, and lowers costs for consumers. I urge my colleagues to support this bill and finally repeal the outdated and protectionist Jones Act,” Senator McCain added.

Roanoke Trade specializes in insuring the transportation industry, offering end-to-end insurance solutions that are tailored to your specific exposures. For information about our insurance products and services, please contact one of our Roanoke Trade professionals at 1-800-ROANOKE (800-762-6653).

 

Sources: Container Management, GCaptain, The Hill

Share This:

Related


Roanoke Insurance Group Celebrates 90 Years of Excellence and Innovation in Logistics and Trade Insurance

February 10, 2025 – Chicago, IL Roanoke Insurance Group proudly celebrates its 90th anniversary as a pioneer and trusted partner in the logistics and trade insurance industry. Since its founding in 1935 in Chicago, Illinois, Roanoke has been at the forefront of industry innovation, delivering specialized insurance solutions that have shaped and supported the global trade and logistics sector. Milestones in Roanoke’s Legacy From its early days as the first provider of customs import bonds in the United States to its recognition as the first official ATA Carnet provider for the U.S. Council for International Business (USCIB) in 1978, Roanoke […]

Industry Insights

Unlocking Success: The Key Elements of Carrier Vetting and Managing Liability

By: Andrew Johnson, Account Executive, Roanoke Insurance Group Inc. The freight brokerage industry as we know it today began in the late 1970s and early 1980s, around the time of the Motor Carrier Act of 1980. Before the passage of this landmark legislation, regulations were too restrictive to make freight brokerage a viable business segment. Fast-forward to today, and most motor carriers, by authority definition, also have a freight brokerage operation. Freight brokerages fulfill a vital service in modern logistics, connecting independent carriers with loads and drastically reducing empty repositioning moves. Brokering also allows carriers to complement their assets by […]

Industry Insights

Leadership Excellence: Karen Rzeszutko Represents Roanoke on USCIB Board

We are excited to share that Karen Rzeszutko, President of Roanoke Insurance Group Inc. has been appointed to the Board of Directors of the United States Council for International Business (USCIB) for the 2024-2026 term. This appointment recognizes Karen’s outstanding leadership and her significant contributions to the industry. The USCIB, a prominent organization dedicated to promoting the success of U.S. businesses globally, has welcomed new and reelected members to its Board of Trustees and Board of Directors. The announcement, made on May 20, 2024, in New York, NY, includes a diverse group of leaders from various sectors who will bring […]

Industry Insights

Roanoke is the leading provider of insurance and surety solutions for transportation and logistics providers. In fact, we are recognized as the most reliable source for U.S. customs bonds.

Contact

If you have any questions or need help, feel free to contact with our team.

800-762-6653

US CORPORATE HEADQUARTERS

1501 E. Woodfield Road

Suite 400W

Schaumburg, IL 60173


CANADA CORPORATE HEADQUARTERS

390 Bay Street

Munich Re Centre, 22nd Floor

Toronto, ON M5H 2Y2

Solutions that Go the Distance.

© 2024 Roanoke Insurance Group Inc.

Better Business Bureau logoCoverholder at Lloyd's logo