The importance of improving our road and bridges became a policy highlight of President Obama’s State of the Union address, when he said that “21st-century businesses need 21st-century infrastructure – modern ports, stronger bridges, faster trains and the fastest Internet.” His solution was for more public funding. Yet, another solution that would help maintain our infrastructure at no new cost to American taxpayers has gone ignored for years.
For many years, there have been recommendations to increase the less than truckload (LTL) trailer size from its current twin 28-foot length to 33-foot without increasing trailer weight limits. The idea of improving highway efficiency by reforming truck size was embraced by the Transportation Research Board as far back as 2002. According to a more recent report, twin 33-foot trailers were found to be significantly safer than the 28-foot trailers that on the road today; and, if widely used, the change would yield be fewer trucks on the road, less diesel fuel consumed and fewer highway accidents.
Similar ideas to improve heavy vehicle road efficiency have been explored in a number of countries in recent years. According to an OECD report, “higher capacity vehicles have potential to improve fuel efficiency and reduce emissions,” as well as yield fewer miles, require fewer trucks on the road, lower transportation costs and result in higher productivity. This would improve road efficiency and utilization, as well as extend the life of our aging roads and bridge infrastructure.
Transportation reform has produced huge consumer benefits and it points to why this reform deserves further consideration. Before deregulation in 1980, the Interstate Commerce Commission not only controlled market entry, but it regulated what could be hauled, where it could be hauled to and the route over which it could be hauled. Rules were set up to make competition “fair” – often requiring trucks to return their trips with empty loads, instead of reloading on the way. These regulations produced huge waste, gross inefficiency, and inhibited competition, keeping cost and consumer prices high.
Nearly 35 years has passed since the deregulation of trucking industry began and they have underscored why sensible reforms work. As the Federal Trade Commission once noted, the benefits from ending wasteful, inefficient and out-of-date regulatory rules account for about $20 billion in annual benefits for consumers (in 1996 dollars) due to lower transportation costs that bring lower priced goods. Today, the intermodal transportation deregulation that took place in the 1980s produces nearly $100 billion in consumer welfare benefits each year. In short, regulatory reform can be a very positive thing.
Now policymakers should take note that the rules put in place over three decades ago deserve a second look. It was 1982 when the Surface Transportation Assistance Act established the length of LTL twin trailers at 28 foot each. Yet, in the years to follow, much has changed for businesses in terms of supply-chain management, just-in-time delivery, and hub and spoke operations. So too for consumers, as Internet services and expedited delivery has influenced how consumers shop, and where we live and work. It is worth revisiting the 1982 rules to see if we can better utilize our roads.
What would modestly increasing trailer size mean for consumers? Just like when deregulation drove down prices some decades ago, better utilization of the roads and improved safety should bring lower transportation costs. That, in turn, would mean lower retail prices.
As Congress gets busy this month, it faces many important problems that need addressing, including taxes, energy conservation, and help for our aging roads and bridge infrastructure. If increasing LTL trailer size helps address some of these issues without imposing any new costs on taxpayers, it deserves the immediate attention of Congress.
Steve Pociask is president of the American Consumer Institute Center for Citizen Research, a nonprofit educational and research organization. For more information about the Institute, visit www.theamericanconsumer.org.