LA’s Wrong Turn

The idea that only employee drivers who could eventually be unionized would be able to reduce truck emissions around seaports was preposterous on its face as well as illegal, and it took the federal courts to point this out to the Port of Los Angeles. The port’s attempt to mandate employee drivers on all trucks entering its terminals as part of its clean-trucks program exposed the organization not as a green port pioneer, but as a political entity willing to advance an anti-trade, pro-labor agenda at the behest of former union leader and current Mayor Antonio Villaraigosa.

A port driver pool converted from today’s independent owner-operators into a work force organized by the Teamsters has no connection to air quality, but it would be a game changer in international trade. It would empower the union to shut down seaports as easily as longshoremen such as those at the International Longshore and Warehouse Union can today, giving it extraordinary leverage in collective bargaining and unquestionably increasing the cost of moving goods in and out of the country. Anyone who doubts this need only recall how shipping company Sea-Land Service was all but shut down during the 1997 Teamsters strike against UPS.

The Los Angeles port’s aggressive pursuit of the employee driver mandate, not just in its initial policy but in staunchly defending it in a lawsuit brought by the American Trucking Associations, exposed a huge divide between the port and its increasingly disillusioned customers, everyone from marine terminals to cargo interests.
Now it’s ramping up to an entirely different level. If it weren’t enough watching the largest port in the country openly agitate against the interests of its customers, including the cargo owners who can divert containers through any port they please, it has now taken its campaign across the country to Capitol Hill. It is now the agenda of the port, supported by the Port of Oakland, to overturn the federal courts and gain the right to regulate local trucking through an act of Congress by amending the 30-year old Federal Aviation Administration Authorization Act.

The port has hired Gephardt Group — the lobbying storefront of former House Majority Leader Richard Gephardt — to coordinate strategy, and it sent senior staffers such as John Holmes, deputy executive director of operations, to meetings in Washington, including a July 29 session with House Transportation and Infrastructure Committee Chairman James L. Oberstar, D-Minn.
Incidentally, the Sierra Group was also present, officials familiar with the meeting tell us, which compels us to ask (again) why environmental groups, whose goals the trade community supports, continue to pursue a strategy of coordinating with the Teamsters, whose agenda diverges so significantly from its own? It defies logic.
The implications are not lost on anyone. A successful change to the FAA law would empower Los Angeles and any other local port entity to regulate local trucking, including imposing an employee driver mandate. It would pull back the so-called federal pre-emption of state and local regulation of foreign and interstate commerce, creating a burdensome patchwork of local regulation nationwide.
The change would be historic and far-reaching, representing the first retreat in transportation deregulation since air, rail, road and ocean modes began to be deregulated in the late 1970s. Few would deny freight transport deregulation has delivered incomparable benefit to the U.S. economy by reducing costs and improving competitiveness, elements desperately needed as the U.S. faces off again rising powers such as China.

For international container trade — a huge portion of U.S. global trade — those benefits are now at risk.
The trade community recognizes the danger and is united against the effort. No other seaport supports Los Angeles and Oakland, including Long Beach, which has implemented its own clean-trucks program — without the employee driver mandate.

After the Oakland Harbor Commission passed its resolution supporting the Los Angeles position, 32 trade groups representing importers, exporters, retailers and logistics firms signed a July 27 letter urging Oberstar to oppose the measure.

“While we strongly support efforts to improve air quality and port security in and around America’s ports, the effort to undermine federal pre-emption of interstate commerce is an attempt to overturn losses in the federal courts restricting local regulation of truck drayage services,” the groups said. “If successful, these efforts will … re-impose a fragmented, local, patchwork regulatory structure on foreign and interstate commerce, contrary to the U.S. Constitution and acts of Congress.”

The concern is less that Congress will be persuaded to make a change on the merits than that a drastic, harmful bid by a single interest to tear into the bedrock of interstate commerce could be railroaded into law by a determined leadership.
The trade community has become increasingly effective in uniting around issues of common concern. This is one of those issues when the full impact of its unity needs to be felt.

Peter Tirschwell is senior adviser for The Journal of Commerce. He can be contacted at 973-848-7158 or ptirschwell@joc.com.

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