Shippers Climb the Hill

Shippers Climb the Hill

When it comes to transportation policy issues in Washington, freight shippers want it all. From heavy industry groups such as the National Industrial Transportation League to the consumer stores represented by the National Retail Federation and the broad mix of factory firms and freight carriers in the National Association of Manufacturers and the U.S. Chamber of Commerce, the list of priorities runs long.

For many, the wish list begins with Congress passing a major new surface transportation bill that boosts infrastructure investment, matched by plans to beef up inland waterways and seaside ports.

Some want tougher regulations on major freight carriers exempt from normal antitrust laws, but hope government will tread cautiously on trucker hours-of-service rules, port-area emissions or security measures so shippers can make reliable business plans.

With the Republican-led 112th Congress seated and President Obama reshuffling his team of economic advisers, shipper groups are jumping into this year’s policy debates. But trade associations including the Chamber and NAM failed this month to stop the new House Republican majority from putting new curbs on how money flows out of the Highway Trust Fund. Many think that jeopardizes federal funding for road and bridge projects.

“Infrastructure is part of the means of production,” said Bruce Carlton, the NITL’s president and CEO. “We’re not going to be able to do other economic activities … unless we have appropriate and sufficient infrastructure.”

The NITL, NRF and 27 other groups ranging, from the National Chicken Council to the Fashion Accessories Shippers Association, sent letters to House and Senate lawmakers urging them to strip foreign ocean ship lines of antitrust immunity.

It was the latest sign shippers haven’t forgotten the tensions from last year’s intermodal capacity crunch and rapid ocean rate hikes. “Last year was just an ugly year,” said Jonathan Gold, the NRF’s vice president for supply chain and customs policy. “Our folks were extremely concerned” about ship capacity and particularly ship lines’ collective rate-making authority.

At the NITL, “We really think it is time to change the law — move beyond collective rate making, move beyond discussion agreements and any form of collective price setting or price signaling, and adopt a model of free, open competition for the liner trades,” Carlton said.

The NITL agrees with shipowners that vessel-sharing agreements help shippers and carriers alike, and, Carlton said, “We want to protect that.”

The retailers’ group doesn’t take the same stance on railroads, however, even though the NITL backed legislation to remove a limited antitrust exemption for major railroads. “Antitrust immunity at any degree, at any level is a sweeping hint that full, fair, free competition is not at work,” Carlton said.

For NAM, job creation is a top priority. The association in January released a new “Jobs for America ” study prepared by the Milken Institute that argues for a package of corporate tax policy changes, infrastructure spending and technology export measures to boost employment and overall economic growth. Tax and other policy changes could stimulate the economy, the report said, while “a government-backed infrastructure program should be considered as an insurance policy” to create jobs.

Some activist rail shippers are still pushing for major regulatory change in how the biggest freight railroads set their rates and service policies.

Having lost their two-year effort to get a new federal law to overhaul rail industry rules, the shippers are filing new challenges against carriers at the Surface Transportation Board. They also hope STB members will soon alter regulatory policies that exempt intermodal and some other large cargo groups from rate cases, and that shield railroads from having to hand off long-haul loads to competing lines.

Some say the biggest agenda item is for policies that promote a stronger recovery.

Carlton was encouraged by the year-end deal between President Obama and Congress on tax cuts, jobless benefits and other incentives, and shippers hope that deal-making attitude would carry over to other such areas as transportation spending.

But when the House tinkered with trust fund spending policy, ostensibly so highway outlays won’t outrun receipts, many said transportation investment could shrink. The rules change “will undercut the goal of executing a multiyear transportation program at guaranteed funding levels,” said Rosario Palmieri, NAM’s vice president for infrastructure, legal and regulatory policy. States need the flexibility that comes from a dependable federal funding stream, and he told some GOP leaders “to plan, develop and deliver a transportation system that suits both local and national needs.”

“Getting a highway bill is a major priority,” Gold said, along with greater attention to freight in federal legislation. The emphasis in transport legislation has always been on moving people, but “now there needs to be more attention paid to moving goods, especially as we continue through the recovery and understanding that goods movement is a critical part of this.”

Gold said retailers’ top agenda issue is “looking at some of these over-burdensome regulations,” such as the government’s plan to reduce trucking hours of service. Among other changes, the proposal may cut an hour of daily drive time, to 10 hours. If that happens, Gold said, retailers will “have to bring on an extra driver to handle that extra hour, and that lost productivity.”

Contact John D. Boyd at