Compass Points - The Jones Act
The Jones Act limits new ships?
August 14, 2025
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USNI News is reporting on the words of Secretary of the Navy Phelan, ‘We Have to Get Urgency into the System.’ Secretary Phelan was talking about Navy shipbuilding, which is facing a roster of serious obstacles. Not only is the Navy short of warships on and below the seas, older ships are not being repaired fast enough, and it is taking too long to build new ships.
As author, Marine, ship expert, and Compass Points reader, CoffeeJoeJava has repeated explained, some of the obstacles to building more ships faster cannot be solved merely with more funding. The problems are much deeper.
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I work on Navy ships. I worked nothing but LHDs for 6 years. They are beaten tired ships. They were designed as 25 year ships...now they want 45-50 yrs out of them. There are very few work items on these ships that are done performed is EXACTLY as written. I have had up to 150% growth work on systems. Exacerbating the problem is the lack of skilled workforce. I have "waxed eloquently" on these forums about the issues the ship repair facilities are facing when it comes to skilled labor. HII (Huntington Ingalls) the sole builders of our aircraft carriers and one of two that build our submarine fleets, is offering $22.00 an hour to push a broom...and begging for people to work. Every shipyard in the Hampton Roads area of Virginia has an apprenticeship program ....with seats unfilled every year. The cause? Years of people like you and me wanting our kids to get the college education and not have to work the hot (or cold depending on the season), dirty jobs we have had to do to support our families. So now we have college educated folks with dimming job prospects due to AI and other advances, and a lack of skilled labor.
Years ago, the Navy had SIMAs in place in every port. These were activities where sailors came off the ships for a shore rotation and learned in depth knowledge of their jobs i.e. electric motor rewinds, valve rebuilding, pump overhauls, micro-miniature electrical repairs etc. They learned these advanced skills so that when they eventually did rotate back to sea duty, they brought this knowledge with them and could be more self sufficient. Well, they did away with all that and made the commercial shipyards the primary for those repairs. Unless someone in their chain of command teaches them (and this is getting more and more rare), these skills are not known anymore. Take a drive down the piers at NOB sometime, or 32nd street, and looks at he ships with all the running rust and just looking shabby. They don't even paint anymore!
-- Compass Points reader, CoffeeJoeJava
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Among US allies there are shipyards around the world in Europe and Asia that could help the US get more Navy ships on the water faster. Yet, some say, the Jones Act is a barrier to overseas ship construction, but is that true?
What exactly is the Jones Act?
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The United States reserves its domestic maritime trade to vessels “built in the United States” under a set of laws popularly referred to as the “Jones Act.” What qualifies as “U.S. built” under the law and U.S. Coast Guard interpretations was recently tested in the U.S. Court of Appeals for the Fifth Circuit case of Diamond Services Corp. v. Curtin Maritime Corp.
Coast Guard regulations provide a two-part test to determine whether a vessel constructed in the United States meets the “U.S. built” test. First, “all major components” of the vessel’s “hull or superstructure” must be “fabricated in the United States.” Second, the vessel must be “assembled entirely in the United States.” The Coast Guard defines a “major component” as a “new, separate and completely-constructed unit” weighing more than 1.5 percent of the vessel’s steelweight. The Coast Guard has referred to excluded items not being part of the hull or superstructure as “outfitting.”
The Coast Guard defines the “hull” as “the shell, or outer casing, and internal structure below the main deck which provide both the flotation envelope and structural integrity of the vessel in normal operation.” The Coast Guard defines the “superstructure” as “the main deck and any other structural part above the main deck.”
Items such as the propeller, propeller shaft, rudder, and rudder stock, for example, are not considered components of the “hull or superstructure.” Similarly, the Coast Guard has consistently held that installations which are not structurally integral to the vessel’s hull or superstructure, such as portable modules for accommodations and auxiliary machinery are exempt.
-- Charlie Papavizas, When is a Vessel Built in America “U.S. Built”
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Does the Jones Act mean the US cannot purchase overseas vessels? Not necessarily. All legislation can be modified. Congress can make any exception to the Jones Act they want. In addition, there could be other situations where the Jones Act might not apply.
1. The intent of the Jones Act is to keep US shipyards full, but US shipyards are full, so arguably the Jones Act does not apply.
2. National Security Exception. Written or unwritten, virtually everything connected to the DOD has a national security exception. For example, in a national emergency, military service members are not allowed to leave the military even though their contract is at an end. No matter the contract, law, or regulation, there is always a national security exception. The US has a shortage of ships that is a real and present danger to national security, which means the US can temporarily acquire ships as needed.
3. Lease instead of buying. The Jones Act says the US can only buy ships constructed in the US, but the Jones Act arguably does not apply to leases. Leasing instead of buying could allow the US to lease foreign ships immediately. On a lease, the US could pay a down payment of 80% of the agreed price and then pay out the rest annually for 20 years. At the end of 20 years, the ship is returned to the foreign owner. The US gets immediate access to foreign ships and the Jones Act remains intact.
The larger point is that it will take new thinking and new urgency to restore the entire Navy - Marine Corps team
USNI News is reporting on the words of Secretary of the Navy Phelan, ‘We Have to Get Urgency into the System.’ Secretary Phelan was talking about Navy shipbuilding but perhaps his words have have a much deeper meaning.
It is time for the Marine Corps to find its own new urgency to get more Marines forward deployed around the globe 24/7/365. It is not enough for the Marine Corps to be ready to deploy. Marines must deploy. The next crisis will not wait on the Marine Corps. It is urgent for the Marine Corps to find new ways to get more Marines on the oceans of the world today.
Compass Points salutes Secretary Phelan and all those working to put more "urgency into the system."
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USNI News - 08/01/2025
SECNAV Phelan on Shipbuilding: ‘We Have to Get Urgency into the System’
By Sam LaGrone
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Winston & Strawn - 05/07/2024
When is a Vessel Built in America “U.S. Built”
By Charlie Papavizas
Since my first days as a Second Lieutenant the instant death sentence read something akin to: “ prohibited by an order, regulation or law.” Well, change the darn order, regulation or law…. This is where the leadership showed a remarkable paralysis, apathy or indifference. It was as if the burning bush had spoken and they were absolved of all responsibility. Should not the SecNav and SecDef be beating down doors to repeal the Jones Act?
Yes, too many clueless young people get their college loan to major in French Medieval Poetry only to later wait tables and feel like their talent has not been rewarded. This where the needs of the nation and immigration reform intersect. A smarter nation would establish immigration categories where we would attract welders, metal workers and other skills to work and after a number of years become eligible for citizenship. Instead we attract the aspiring rock star, fashion designer and frustrated poet who comes to kick back on the dole. Not to mention criminals.
“Over the bleached and jumbled bones of every failed civilization are written the pathetic words: too late, too late.” We are in exactly that trajectory. The sense of urgency to get women in the infantry seemed to resonate. The energy and urgency to build or buy, man and exercise ships and planes just seemed too mundane for legions of Flag Officers, Secretaries of the Navy and Defense. Hire some firebreathers, dump the deadwood and set it on fire. Get some damn results.
-"They don't even paint anymore!" - coats of grey were the always the running joke. I remember the sailors on the 'DaPuke laughing when I asked about the 40mm AA mounts ('92). "We don't shoot 'em, we just paint 'em". (They admitted they occasionally shot the guns, but it was a very low priority). Sobering point...not painting is worse than not using; indifference is the highest form of hatred.
-To Coffeejoe's point: This issue exposes a gross cultural problem in senior levels and in the entry population, both civilian and Navy. If no-one is prioritizing the details that lead to greater self sufficiency at the tip of the spear underway, much less competency in port, then who is going to see to those details? Further, have we truly jumped the shark with respect to our tradesman in the shipyards. Coffeejoe thinks so, and I wonder, what now? This is a bigger issue if we can't get warm hands and fertile minds to pick up the tools.