As the consumer drive to deregulate the trucking cartel builds momentum in Congress, it is useful to inquire who is supporting continued regulation. Ronald Reagan, John Connally, General Motors and, of course, the American Trucking Association favor the 45-year-old Interstate Commerce Commission’s regulatory maze which prohibits price competition and restricts entry into the huge non-agricultural trucking business.
Ten years ago, one of our study groups released a long report urging an end to this wasteful, monopolistic system and a return to competition that would save consumers billions of dollars. The Nixon Administration rejected the recommendations. So did the U.S. Chamber of Commerce.
Now, while organized business is beating the drums loudly against government regulation, blaming the feds for virtually every ailment of the corporate sector, GM president “Pete” Estes addresses the Toledo, Ohio, Chamber of Commerce with these words:
“Through regulation, the government safeguarded the quality and level of service of motor carriers while at the same time protecting the health and safety of the public which used them.”
Here are some results of what ICC cartel regulation, shaped by the trucking companies, has produced:
—Thousands of trucks carry goods to a destination but have to come back empty because they are not authorized to carry back other goods. Large amounts of fuel are wasted, highways are more congested thereby increasing accident risks and the consumer pays more. Under industry lobbying, the ICC has made these illustrative distinctions as to which trucking companies can carry what products: oranges and orange peels, whale meat and seal blubber.
—Carried for different rates over the same routes are plain toilet paper holders and chrome-plated toilet paper holders, to name one of the thousands of separate rates for basically similar products.
—The ICC has granted immunity from the anti-monopoly laws to truckers who sit down around a table as part of private rate bureaus to fix prices.
—The ICC historically has rejected applications by individual truckers to reduce their rates if the trucking industry objected.
—The ICC law exempts from economic regulation truckers shipping agricultural products. Farmers believe the service is better and cheaper because it. is outside the ICC-trucking industry cartel.
—ICC rules prohibit household moving companies from giving consumers a binding estimate. Moving companies like it that way since the rule permits them to charge a higher price before they will unload the family’s possessions.
The injustice of this system has persuaded even Congress to’ start moving a partial, weak de-cartelization bill. After fighting against all bills, the powerful trucking lobby is tactically conceding only the least consequential deregulation provisions. But the retention by the American Trucking Association of the public relations firm, Hill & Knowlton, for $4 million is designed to maintain the industry’s insulation from price and new-trucker competition.
Like the maritime companies and most airlines, the truckers want government to shield them from competition. This is the regulation the corporations support; it is the health and safety standards, weak or little enforced as most of them are, which are the object of the business war on the law.
Why would business oppose these weak standards, particularly standards that anticipate market demands like fuel efficiency or head off large liability lawsuits like disapproval or removal of unsafe drugs?
There are three reasons. One, of course, is to chill the regulators from issuing long-overdue new standards. With the help of the Carter White House, the false corporate cry of overregulation actually has resulted in under-regulation for the safety of consumers and workers.
Second, corporate strategists use the over-regulation war cry to improve the likelihood of further government subsidies and tax benefits across the board or specifically, as in the case of the Chrysler bail-out last year.
Third, Uncle Sam’s tepid regulation is used as an all-purpose corporate scapegoat to divert attention away from corporate mismanagement and myopic business practices. The domestic auto and steel industries have used this ploy to cover their failings to compete with foreign imports. The Big Three automakers knew how to build fuel-efficient cars years ago but they didn’t. Hence, they blame Washington rather than themselves.
Big business executives rarely are questioned about these matters. The public forums for such inquiries scarcely exist.
But candidate Reagan won’t be so cloistered in the coming months. His legendary one-liners won’t explain away the difference between his anti-government rhetoric and his awareness that business demands so much of that government from the ICC to the swollen subsidy programs.