Advancing a Free Society

How to waive the Jones Act

Friday, June 18, 2010

Jones Act waivers are in the news because of the Gulf oil spill.  I would like to contribute to that discussion by sharing my experiences coordinating the Jones Act waivers for President Bush in the wake of Hurricanes Katrina and Rita.  In 2005 I served as the Deputy at the White House National Economic Council.

I’ll begin with a quick definition.

cabotage (n):  navigation or trade along the coast

The Merchant Marine Act of 1920, aka the Jones Act, precludes a foreign-flagged ship from operating near the U.S. coast.  As I understand it, outside of three miles it’s fine.  I am most used to it in the context of it precluding foreign-flagged ships from transporting stuff from one U.S. port to another.

The Jones Act can be waived “in the interest of national defense.”  Since the Coast Guard is part of the Department of Homeland Security, the Secretary of Homeland Security actually issues the waiver.  The law says the Secretary shall waive it “upon the request of the Secretary of Defense to the extent deemed necessary in the interest of national defense by the Secretary of Defense.”  The Secretary may waive it “either upon his own initiative or upon the written recommendation of the head of any other Government agency, whenever he deems that such action is necessary in the interest of national defense.”

Continue reading Keith Hennessey…

(photo credit: Deepwater Horizon Response)