Strange Friends of the New EPA Trucking Regulations

Recent headlines would have you believe the trucking industry and environmentalists are all singing kumbaya in praise of President Obama's new regulations to lower greenhouse gas emissions and increase fuel efficiency in medium-and heavy-duty trucks.  If you were wondering what's driving the cozy relationship between the Trucking Industry and the EPA, you are not alone. 

When industry officials emerged from the White House Tuesday last week eerily happy to embrace the new Transportation Department and EPA standards that promise to rock their industry Megan McArdle at The Atlantic opined that either something is missing in this story, or American manufacturing is in even worse shape than she suspected. 

Tim Linden writes, "It is a rare government regulation that receives universal high marks, but such is seemingly the case with the new truck fuel efficiency standard."  Fred Krupp, president of the Environmental Defense Fund stated, "It's great to see Washington get something so right. Thanks to these new standards, everybody wins: Truck drivers save money at the pump, America imports less foreign oil and we all get to breathe cleaner air."  

There is more to the story; this legislation promises to put the EPA in charge of yet another fundamental sector of our economy -- transportation of goods.  EPA is in control of the stick and the carrot in this scenario, with both regulation and EPA's administration of a special SmartWay grant program that benefits the shipping industry.

These regulations are the first of their type within the trucking industry and will require manufacturers to cut fuel consumption and emissions for model years 2014 through 2018.  Fuel costs are one of the highest operating costs in the trucking industry and play an integral part of the market.  Commercial vehicles, by necessity, have different requirements because they are used in many different applications with different payloads making a uniform standard impossible if not counter-productive.  Those big rigs need big power to pull the load they carry.  A fully loaded trailer might average 5 to 7 mpg but also weights 25 to 30 times as much as a passenger vehicle. 

American Trucking Association (ATA) President and CEO Bill Graves touted the move as, "Welcome news to us in the trucking industry."  He would make Wesley Mooch proud.  The whole scene reminds me of AARP pushing the Healthcare bill.  The ATA is comprised predominately of the largest shippers and receivers and only the very largest trucking companies.  It is not made up of the owner-operators, as many mistakenly believe.  Nick Loris at the Heritage Foundation said these plans will result in higher costs and are not what the industry needs right now.  

But ATA's Graves doesn't stop with embracing the new regulations; he wants even more government regulation: 

"In addition to the standards, the U.S. should implement a national speed limit of 65 miles per hour for all vehicles and issue rules requiring trucks to be electronically governed at that speed; ...the federal government must continue its support of the incredibly successful EPA SmartWay program and finally, Congress must reform federal truck size and weight limits in order to allow the industry to operate its most productive and efficient vehicles."

I cannot ever recall hearing the words "incredibly successful" preceding the word 'EPA' by any entity that purports to represent business.  Are we to believe the trucking industry as a whole is begging the federal government to require all commercial vehicles be subject to electronic governors?  If slower speeds give you better mileage, don't press so hard on the gas!  You don't need the Federal government to impose regulations; unless this has nothing to do with saving fuel and the environment but is really about using the government to put the competition at a disadvantage. 

According to the White House, they worked closely with manufacturers, the auto workers unions and the State of California.  Did they bother to notice how quickly corporations are fleeing California due to overbearing regulations or that California has a $26 billion dollar budget deficit?

ATA's Publicity Director, Sean McNally, says this is a great example of how regulation should work that is mutually beneficial.  "All the regulations at the end of the day inure to our benefit."  He claims their association tries to stay at the cutting edge of safety and efficiency. "We couldn't be happier that the Obama administration and the federal government have decided to move forward with this," said McNally. 

Deborah Solomon in the WSJ says the White House secured support for the heavy-truck standard from the industry, which is backing the move.  Joe Rajkovacz, the Director of Regulatory Affairs at the Owner Operator Independent Drivers Association (OOIDA) says that is not the case.  He explained how his members at OOIDA will be very negatively impacted by this legislation and points out that nearly 96 percent of registered motor carriers in the U.S. operate 20 or fewer trucks.  He explained the reason the ATA is in favor of this legislation is because their membership is made up of the shippers and receivers, not independent truckers.  ATA members and the truck manufacturers predominately participate in EPA's SmartWay -- a federal government grant program, something Rajkovacz's smaller operators are largely unable to do.  According to the New York Times, the EPA said the rules would only cost vehicle buyers $8 billion, but that would be paid for in fuel savings in a year or two.  Lest you think this is the end game, it isn't.  Elizabeth Shogren at NPR points out; the new truck rules aren't strict enough to force a switch to hybrid technology.  Environmentalists plan to push for regulations that would do that after 2018. 

These new standards represent a noose not a lifeline for trucking and Rajkovacz is calling on Congress to revise the ill-conceived regulatory scheme when they are back in session.  At the end of the day it is the U.S. taxpayer who has the privilege of paying for this unnecessary program.  The Recovery and Reinvestment Act of 2009 included $30 million for the SmartWay program and $60 million for FY 2011 for the National Clean Diesel Program which supports SmartWay. 

The bulletin on the regulation mentions the joint standards are rooted in regulatory history in EPA's SmartWay Transport Partnership program.  It also states, "Our country has two intertwined and critically important needs - to reduce oil consumption and to address global climate change."  Our country does have two intertwined and critically important needs - balancing the federal budget and getting our economy moving in the right direction.  Adding more regulations that are overseen and administered by the Employment Prevention Agency is NOT the way to do either.  One sure fire way of reducing our reliance on foreign oil is to drill here, an option not included in this plan.  I agree with Scott Burgess: Let's force government, not cars, to be more efficient.

Melody Himel Scalley is an entrepreneur in Public Relations and Communications and hosts a conservative talk-radio show, on 103.3 WESR FM, 'Politics On the Edge.' www.melodyscalley.com  Contact her at melody@melodyscalley.com

Recent headlines would have you believe the trucking industry and environmentalists are all singing kumbaya in praise of President Obama's new regulations to lower greenhouse gas emissions and increase fuel efficiency in medium-and heavy-duty trucks.  If you were wondering what's driving the cozy relationship between the Trucking Industry and the EPA, you are not alone. 

When industry officials emerged from the White House Tuesday last week eerily happy to embrace the new Transportation Department and EPA standards that promise to rock their industry Megan McArdle at The Atlantic opined that either something is missing in this story, or American manufacturing is in even worse shape than she suspected. 

Tim Linden writes, "It is a rare government regulation that receives universal high marks, but such is seemingly the case with the new truck fuel efficiency standard."  Fred Krupp, president of the Environmental Defense Fund stated, "It's great to see Washington get something so right. Thanks to these new standards, everybody wins: Truck drivers save money at the pump, America imports less foreign oil and we all get to breathe cleaner air."  

There is more to the story; this legislation promises to put the EPA in charge of yet another fundamental sector of our economy -- transportation of goods.  EPA is in control of the stick and the carrot in this scenario, with both regulation and EPA's administration of a special SmartWay grant program that benefits the shipping industry.

These regulations are the first of their type within the trucking industry and will require manufacturers to cut fuel consumption and emissions for model years 2014 through 2018.  Fuel costs are one of the highest operating costs in the trucking industry and play an integral part of the market.  Commercial vehicles, by necessity, have different requirements because they are used in many different applications with different payloads making a uniform standard impossible if not counter-productive.  Those big rigs need big power to pull the load they carry.  A fully loaded trailer might average 5 to 7 mpg but also weights 25 to 30 times as much as a passenger vehicle. 

American Trucking Association (ATA) President and CEO Bill Graves touted the move as, "Welcome news to us in the trucking industry."  He would make Wesley Mooch proud.  The whole scene reminds me of AARP pushing the Healthcare bill.  The ATA is comprised predominately of the largest shippers and receivers and only the very largest trucking companies.  It is not made up of the owner-operators, as many mistakenly believe.  Nick Loris at the Heritage Foundation said these plans will result in higher costs and are not what the industry needs right now.  

But ATA's Graves doesn't stop with embracing the new regulations; he wants even more government regulation: 

"In addition to the standards, the U.S. should implement a national speed limit of 65 miles per hour for all vehicles and issue rules requiring trucks to be electronically governed at that speed; ...the federal government must continue its support of the incredibly successful EPA SmartWay program and finally, Congress must reform federal truck size and weight limits in order to allow the industry to operate its most productive and efficient vehicles."

I cannot ever recall hearing the words "incredibly successful" preceding the word 'EPA' by any entity that purports to represent business.  Are we to believe the trucking industry as a whole is begging the federal government to require all commercial vehicles be subject to electronic governors?  If slower speeds give you better mileage, don't press so hard on the gas!  You don't need the Federal government to impose regulations; unless this has nothing to do with saving fuel and the environment but is really about using the government to put the competition at a disadvantage. 

According to the White House, they worked closely with manufacturers, the auto workers unions and the State of California.  Did they bother to notice how quickly corporations are fleeing California due to overbearing regulations or that California has a $26 billion dollar budget deficit?

ATA's Publicity Director, Sean McNally, says this is a great example of how regulation should work that is mutually beneficial.  "All the regulations at the end of the day inure to our benefit."  He claims their association tries to stay at the cutting edge of safety and efficiency. "We couldn't be happier that the Obama administration and the federal government have decided to move forward with this," said McNally. 

Deborah Solomon in the WSJ says the White House secured support for the heavy-truck standard from the industry, which is backing the move.  Joe Rajkovacz, the Director of Regulatory Affairs at the Owner Operator Independent Drivers Association (OOIDA) says that is not the case.  He explained how his members at OOIDA will be very negatively impacted by this legislation and points out that nearly 96 percent of registered motor carriers in the U.S. operate 20 or fewer trucks.  He explained the reason the ATA is in favor of this legislation is because their membership is made up of the shippers and receivers, not independent truckers.  ATA members and the truck manufacturers predominately participate in EPA's SmartWay -- a federal government grant program, something Rajkovacz's smaller operators are largely unable to do.  According to the New York Times, the EPA said the rules would only cost vehicle buyers $8 billion, but that would be paid for in fuel savings in a year or two.  Lest you think this is the end game, it isn't.  Elizabeth Shogren at NPR points out; the new truck rules aren't strict enough to force a switch to hybrid technology.  Environmentalists plan to push for regulations that would do that after 2018. 

These new standards represent a noose not a lifeline for trucking and Rajkovacz is calling on Congress to revise the ill-conceived regulatory scheme when they are back in session.  At the end of the day it is the U.S. taxpayer who has the privilege of paying for this unnecessary program.  The Recovery and Reinvestment Act of 2009 included $30 million for the SmartWay program and $60 million for FY 2011 for the National Clean Diesel Program which supports SmartWay. 

The bulletin on the regulation mentions the joint standards are rooted in regulatory history in EPA's SmartWay Transport Partnership program.  It also states, "Our country has two intertwined and critically important needs - to reduce oil consumption and to address global climate change."  Our country does have two intertwined and critically important needs - balancing the federal budget and getting our economy moving in the right direction.  Adding more regulations that are overseen and administered by the Employment Prevention Agency is NOT the way to do either.  One sure fire way of reducing our reliance on foreign oil is to drill here, an option not included in this plan.  I agree with Scott Burgess: Let's force government, not cars, to be more efficient.

Melody Himel Scalley is an entrepreneur in Public Relations and Communications and hosts a conservative talk-radio show, on 103.3 WESR FM, 'Politics On the Edge.' www.melodyscalley.com  Contact her at melody@melodyscalley.com

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