The Open Road

Carter keeps on truckin

Jimmy Carter's drive to free the nation's transportation system from the octopus of federal regulation is rolling. Airlines were deregulated two years ago, and a bill to unfetter the railroads is expected to pass Congress later this summer. Last week the President put his signature on the Motor Carrier Act of 1980, which will begin dismantling 45 years of federal controls over the trucking industry. About 17,000 carriers, or 40% of the business, will be directly affected. The rest of the industry is unregulated because it hauls items not subject to controls, like unprocessed agricultural products, or because the trucks belong to private carriers such as department stores. The bill should stimulate competition by making it easier for new haulers to enter the field, relaxing restrictions on the commodities that can be hauled, eliminating circuitous routing and phasing out price fixing by 1984.

In 1935 Congress gave the Interstate Commerce Commission the power to regulate the fledgling trucking business. But over the years, as the infant grew into a $108 billion-a-year leviathan, the agency produced some startlingly ludicrous anomalies. Agricultural haulers, for example, could carry milk but not yogurt or ice cream; truckers could move grain from farm to market but could not take animal feed back in their empty trucks. Reason: both milk and grain were exempt from ICC regulation as unprocessed commodities, whereas yogurt, ice cream and animal feed were regulated.

Perhaps the most damaging effect of ICC controls was that they hindered competition. Companies trying to obtain the right to haul goods between one state and another had to face costly and exhausting ice hearings, where they were obliged to show that they would not hurt existing firms. Truckers already on the road naturally protested that they would suffer. Timothy Person, a black St. Louis mover of household goods, worked for nearly 30 years to have his company licensed to transport goods outside Missouri. Nine national carriers opposed him, but in February Person finally won a nationwide license.

Last week's action culminated a long and arduous political fight. Senator Edward Kennedy first began holding hearings almost three years ago about the possibility of freeing the industry from some ICC rules, and President Carter sent his bill to Congress on June 21, 1979. In an unusual display of accord, the two rivals both lobbied hard for the measure. But the Teamsters union and the American Trucking Associations fought it. The A.T.A. spent more than $1 million on a public relations campaign to convince legislators that deregulation would mean increased prices, wasted gasoline and decreased service to small towns.

The effects of the new law will probably be quickly evident. Industry officials expect a rash of mergers as inefficient outfits, no longer protected by artificially high rates, are shaken out. At the same time, these officials predict, many new haulers will soon open shop. The Congressional Budget Office estimates that consumers will eventually save $5 billion to $8 billion annually from lower rates. More efficient routing and the elimination of backhaul restrictions that forced truckers to make return trips empty should also result in fuel economies worth anywhere from 50 million to 164 million gal. per year. Like a well-executed triple play, trucking deregulation should help ease the nation's problems with inflation, excessive government regulation and energy.

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