html xmlns="" xml:lang="en" lang="en"> From the archives: Good work, Mayor Villaraigosa.

Monday, March 24, 2008

Good work, Mayor Villaraigosa.

I called my secret insider unnamed source to ask her about this story about the Los Angeles Harbor Commission forcing shipping companies to buy and maintain trucking fleets and employ their drivers. She was psyched. She says it is a big deal.

Until now, truckers doing short hauls out of the ports were doing contract piece work. They’d call a dispatcher who had an order for a hundred boxes to go to Target warehouse and get in line at the port gate to pick up a box. They owned their trucks, and these aren’t nice trucks, and try to get in a few trips a day. If something went wrong, they bore the full brunt of hitting traffic, of the box not being available, anything. They have no health insurance, no guarantee of employment, no retirement; they have to maintain their own trucks; they’re competing with each other, driving down the per-trip prices. Their time isn’t valuable to anyone else. My source says they spend hours in lines of idling diesel trucks waiting at the Port gates.

I asked her who was actually going to hire the drivers and she says those trucking companies don’t exist right now. Either the shipping companies will form those companies or maybe an independent trucking company will form. Either way, the drivers want this. When there’s a company, they can unionize. Besides, the Ports of Los Angeles and Long Beach have a Clean Air Action Plan that commits them to replacing the truck fleet. The current truck fleet is a big source of local air pollution and the Clean Air Action Plan says that nearly 17,000 trucks must be replaced within five years. There’s just no way the individual truckers working as independent contractors could buy new clean trucks. I asked my source, who laughed “oh, they’re not even like the long haul truckers who drive across country and sleep in their trucks. Those are nice trucks. These are trucks that have done everything else, and now you hope they can make it ten miles to the warehouse.” The new companies who step into this will have to provide modern, less polluting trucks.

I asked my secret source if there are any other alternatives than trucking boxes. She says there is local cargo and discretionary cargo. Discretionary cargo goes to the hinterland by rail; she says they can pick any port depending on how the costs work out. There is a new port up in Prince Rupert designed for only rail transport. It can be cheaper to get stuff to Chicago from Canada by rail than use a closer port on the east coast. I asked if it would be worth it for Los Angeles or Long Beach to switch some of their trucking transport over to rail, but she says that people don’t particularly like having railyards in their neighborhoods either. Local cargo (few hours radius) pretty much has to be trucked.

Anyway, this is great news. These truckers are very poor people who subsidized the price of container shipped goods with their health and quality of life. They won’t have to pay that for us any more.


Blogger Stephen said...

Have you ever seen the Humphrey Bogart movie They Drive by Night? A movie from 1940 with a similar plight for truckers in L.A. as a major plot element. Strange how some things stay the same...

5:56 AM  
Anonymous Anonymous said...

Mmmm. I believe if you really follow this, you will see that most of these freight taxi drivers [in essence what they are] will not be the ones that get the jobs envisoned. Having dealt with the teamsters any number of times, both driving for and against them, as a shipping manager, and in a family business... Sometimes they can make positive changes, but it comes at a steep price. The Freight taxi guys drive that way for a reason, and it often involves NOT being involved with teamsters. Like a lot of unions, if you are an outsider or just starting, there are a lot of political dues to pay, and some monetary ones, and if they don't like you, you may as well find another line of work. Independant guys are sometimes that way in the short hauling business, because they have gotten sideways to the teamsters.

So, if you want to see the story BEHIND the story, you may want to see if any of those freight taxi guys ACTUALLY fill any of those jobs that will be created by the shipping companies. Because of all the things those shipping companies will have to do, in terms of trucks, insurance, bonding and whatnot, they will want experienced drivers with clean track records. For the freight taxi guys who can fill all that? This may be a good thing. for all the rest of them, they just saw their jobs go away. Whoever this helps, it isn't going to be them.

There are many ways they could have transitioned this environmentally, without resorting to this sort of law. Even if groups of the small indie freight guys band together, they may not be able to afford to comply with all the regs. that are about to happen. When you put in laws like this, it really favors large operators who have the size to scale economy the thing. This sort of short haul movement is, as you can imagine, the least efficient way of moving freight. It is, as mentioned also the only way to do it. The rub is, that the profit margins are astonishingly slender. How do you pay for that new $100k truck, and the $4.50 a gallon diesel, union wages...

These requirements predispose the freight to go to large, established LTL companies, that already have the equipment, and drivers to comply with the new laws.

Companies that couldn't compete before because the indies could do it for cheaper. Now those companies will be able to come in and be profitable because they will have the backing of law behind them. those 100 boxes that go to target will double or triple in price for freight, simply because the law will mandate that only the shipping company or it's main contractor can move the freight. They will be able to charge a much higher price for their freight fee.

Now all of that isn't necessarily bad, in terms of environmental impact, but the real impact to these indies, will not be pretty. Those that can get on with large companies will do so, and with luck won't end up with a pay cut. [When you are an indie, money is yours, when you drive for others, you lose a lot in administration...] There will be a great many drivers that will not make the cut with larger companies though, for various reasons. They may not be bondable, may not be accepted by the company insurance, because of driving record. Or, their citizenship may be questionable...

It is possible that for the public good, you don't want these guys driving the short haul stuff, but the transition will be pretty brutal.

seems to me thay could have taken away the idling problem by eneacting or enforcing a local ordinance against idling. There are numerous places that have those. Idling a diesel is a throwback to the days when stopping and starting trucks wasn't worth it. But that was 40 years ago. Modern trucks have no such issue.

After changing the easy environmental rule about idling, then you can begin some basic enforcement of pollution rules. I'm guessing Cali. has them, but maybe of old these trucks in question fell through the cracks. If the were still falliing through the cracks, you could require certification tags before entering the harbor freight area. That would force changes in trucks, but not necessarily ones that would put indies out of business. Conforming to minimum standards, should be a requirement.

In the long run, maybe you keep inching the standards up to where you need them to be, but in a transition.

You have to give the indie a chance to compete, rather than assuming there is no way that he can. Putting a law in from the top like this garundamntees that he cannot compete AT ALL.

If the REAL purpose of the law was environmental, then you simply set the standards and the indie drivers will respond to that in whatever way they can. But to come in and mandate that only certain companies can do things in certain ways, just means that ONLY those companies will be able to do business. Everyone else cannot.

on the other hand... when you awake at 4am inexplicably, do you get up, take a sip of water and go to the window, to see what the sky is doing? I opened the window to take a breath of cold, clear night air and silence. While looking out a fox padded by in the lot behind me, and looked at me as if to say, "what're you doing up, don't you know it's 4am?" Slept better after that.


6:48 AM  
Anonymous Peter said...

If I'm not mistaken, rail capacity out of the Los Angeles/Long Beach port complex is quite limited, with only a single track for part of the way. This leads to major backup of containers.

10:06 AM  
Blogger Eric H said...

You might want to pick up a copy of _The Box_. The Cities of LA and Long Beach helped break the unions (Longshoremen, remember them?) who opposed the container shipping in the first place. On the East coast, the Feds helped break them. The cities also made substantial investments into the freeway infrastructure that made all this possible. Mmm, don't you just love the smell of idling diesel and bunker fuel engines in the morning? Basically, you have the government bailing people out of a situation which the government helped to create. Oh well, if this is what it takes to get those "freely" traded goods from China to Wal-mart, it's all for the best, I guess.

I wonder what unintended consequences the next generation of mayors will have to contend with?

9:46 PM  

Post a Comment

<< Home