Domestic Energy Shipments Are Breaking Records Under the Jones Act Waiver

By Colin Grabow of Cato.

"The Jones Act is a de facto tax on Americans trading with one another. By requiring domestic waterborne commerce to use vessels that cost far more to build and operate than their international counterparts, the law raises shipping costs. That’s a real burden given the significance of transportation in a country as vast as the United States and helps explain why relatively little freight moves by water.

Conversely, economic logic holds that lowering these costs will expand commerce, which is exactly what has happened since the Trump administration issued a Jones Act waiver for energy and fertilizer shipments in March. Freed from the law’s constraints, domestic fuel shipments have surged to unprecedented levels.

PADD 5 Receipts Nearly Set a Record in Five and a Half Months

One of the most dramatic examples of this increase has been to the West Coast, Alaska, and Hawaii, collectively known as PADD 5. According to a recent Energy Information Administration analysis, waterborne shipments of crude oil and petroleum products from the Gulf Coast to PADD 5 in April and May 2026 were more than four times their level in the same months of 2025. April’s volume was more than double the previous monthly record, and shipments remained elevated in May. 

That increase has been sustained. US Maritime Administration (MARAD) data show that in less than six months, waiver shipments have already exceeded the Jones Act fleet’s annual total in every year from 2000 through 2025, with one exception. Only 2024 remains narrowly ahead (by 2.2 percent), and it appears on the verge of being surpassed." 

Jet fuel: More jet fuel has been moved to PADD 5 under the waiver than in the preceding 35 years combined (1990–2025). 

Gasoline blend stock and alkylate: More gasoline blending components and alkylate have been moved into PADD 5 than the Jones Act fleet moved from 2010 through 2025 combined. 

Finished gasoline: The waiver has seen more finished gasoline moved to the West Coast than the Jones Act fleet has moved in the last eight years combined."

"East Coast-bound shipments topped 1.2 million barrels a day in April, which was the highest monthly figure on record and about 11 percent above anything seen pre-waiver."

"In 2017, the CEO of Overseas Shipholding Group, a major Jones Act tanker operator, admitted to the Financial Times that the law was suppressing domestic oil flows: “If there was not a Jones Act, then there probably would be more movements of crude oil from Texas to Philadelphia.”" 

The Milei Miracle, Part V

By Dan Mitchell.

"The world’s worst-performing economy for 100 years has – in a remarkably short period of time – become an amazing case study of economic liberalization.

Thanks to President Javier Milei, Argentina is now enjoying an economic miracle.

In Part V of this series (previous versions here, here, here, and here), we’re going to illustrate Milei’s accomplishments with a series of tweets.

Today’s column will focus on bad things that are falling (a future column will highlight good things that are rising).

We’ll start with falling poverty.

Next we have falling debt.

And falling deficits.

By the way, all this progress occurred because of spending restraint. Milei is not making the mistake of higher taxes.

Anyhow, with better fiscal policy, this understandably leads to falling country risk.

Next, let’s look at falling bureaucracy.

And we’ll close with falling inflation.

Javier Milei is easily the world’s best leader.

A steroid version of Reagan and Thatcher."

Median Family Income for Married Couples With Children Is Probably Higher Than You Think

By Jeremy Horpedahl.

"In 2024, median income for married couples with children at home was $143,400 in the US. That’s an almost 80 percent real (inflation-adjusted) increase since 1974, the first year Census reports comparable data. Is there some selection bias in who chooses to get married and have kids? Yes. Has there been an increase in dual-income families? Yes, but probably much less than you think (the median family of this type already had two earners by the late 1970s).

With those caveats, this is still pretty impressive:"

 

The Contribution of High-Skilled Immigrants to Innovation in the United States

By Shai Bernstein, Rebecca Diamond, Abhisit Jiranaphawiboon, Timothy McQuade & Beatriz Pousada. In the American Economic Review.

"Abstract

We characterize the contribution of immigrants to US innovation. Leveraging new data, we use age of SSN assignment to identify immigrant status. Immigrants represent 16 percent of inventors, but authored 23 percent of patents. Immigrant inventors contribute to knowledge diffusion across borders. They disproportionately rely on foreign technologies and inventor collaborations. Using variation from premature inventor deaths, we find immigrant inventors create stronger innovation productivity spillovers on their collaborators, as compared to US-born inventors. A simple model implies immigrants are responsible for 32 percent of aggregate innovation, over half of which is due to human capital externalities on US-born collaborators."

Reflections on Americans’ Net Worth

By Bryan Caplan. Excerpt:

"I’ve been an economics professor for almost 30 years, but I don’t think I’ve ever before seen anything like the table below. I knew that claims that “58% of Americans can’t afford a $1,000 car repair” were laughable clickbait. I knew that — measured by income — the middle class is disappearing… by becoming upper-middle class. But only recently did I start to fully appreciate the chasm between populist pessimism and actual data on Americans’ net worth. From the 2022 Survey of Consumer Finances: 

 

"Main reflections:

1. Economists have long known that inequality is relatively low for consumption, medium for income, and high for wealth. What they rarely emphasize, however, is how much wealth depends on age. The richest Americans aged 65-69 are worth about 30x as much as the richest Americans aged 18-24.

2. Net worth is very high in absolute terms. The median is over six figures by the mid-30s. Americans at the 75th percentile are millionaires by their mid-50s. Americans at the 90th percentile are millionaires by around 40. Claims about middle-class, middle-aged Americans who “can’t afford” eggs or gas or beef are nonsense.

3. The most sensible argument for worrying about trade deficits is that we’re “living beyond our means.” Trade deficits represent borrowing, and we can’t keep borrowing forever. But given Americans’ extraordinary net worth, the most sensible argument for worrying is still senseless. After 50 years of unbroken trade deficits, we’re wealthier than ever."

  

Despite government spending and regulations on green energy transitions, fossil fuels still accounted for 76.3% of Canada’s domestic energy consumption in 2024 compared to 76.8% in 1995

By Kenneth P. Green, Julio Mejía and Elmira Aliakbari. They are all with the Fraser Institute.

Energy Facts - Canada Edition

• Despite continued discussion about energy system transitions, fossil fuels remain central to Canada’s energy system. In 2024, they accounted for nearly 88% of domestic energy production and more than 76% of energy consumption.
• Pipelines remain essential for the country’s energy system. Over the past decade, pipeline safety has improved, with safety incidents falling by nearly 60% and the share of incidents involving product releases declining from 83.2% in 2014 to 20.6% in 2024.
• Canada’s largest energy-consuming sectors remain heavily reliant on fossil fuels: in 2024, fossil fuels supplied nearly three-quarters of industrial energy use, and more than half of residential energy use, with natural gas remaining the dominant source, particularly for space heating. Meanwhile, fossil fuels accounted for almost 99% of the transportation sector’s energy consumption in 2024.
• The energy sector is also a major economic contributor, representing 6.9% of Canada’s total economic activity. Its importance is even greater in some provinces: energy accounts for 30.1% of Alberta’s economy, 22.7% of Newfoundland & Labrador’s, and 21.5% of Saskatchewan’s.
• Energy is one of the top 10 categories of average household spending. Over the past two decades, energy prices have risen faster than overall inflation and have been more volatile than many other household expenses, increasing pressure on family budgets.
• Overall, fossil fuels remain essential to Canada’s standard of living, and ensuring reliable, affordable, and safe energy systems will remain a key priority in the years to come.

Most European Countries that Had Wealth Taxes Have Repealed Them

By David R Henderson. Excerpts:

"According to the OECD, 12 OECD countries had individual net wealth taxes in 1990, and all 12 were European countries. By 2017, only four OECD countries still had them" 

"the likely reason is that they were losing some of their wealthiest residents to other countries that didn’t impose taxes on wealth."