Posted on Tuesday, December 31, 2024
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by Outside Contributor
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Since Phil already laid out the comprehensive case against Jimmy Carter, with which I agree, I wanted to note that despite all of that, Carter did sign three of the best laws Congress has passed in the last 100 years — and many of the progressives who love Carter hate all three of them:
- The Airline Deregulation Act of 1978. Before this law, the Civil Aeronautics Board (CAB) got to decide which airlines operated which routes and what prices they were allowed to charge. Carter appointed regulatory economist Alfred Kahn as CAB chairman and charged him with dismantling the agency. The Airline Deregulation Act eliminated the Civil Aeronautics Board — abolished a federal agency in real life! — and freed airlines to compete with each other. Deregulation resulted in the advent of low-cost carriers and the wider availability of air travel to the middle class.
- The Motor Carrier Act of 1980. Before this law, the Interstate Commerce Commission (ICC) got to decide which trucking companies operated which interstate routes and what prices they were allowed to charge. The Motor Carrier Act removed those powers, and today, the trucking industry is one of the most competitive industries in the United States. Thousands of independent owner-operators compete to offer the lowest prices and fastest service, with the constant churn of firms entering and exiting the trucking market. The law also helped break the power of the Teamsters, who were no longer negotiating with legally protected monopolies for labor contracts and could not unionize the mass of independent truckers.
- The Staggers Rail Act of 1980. Before this law, the ICC also got to decide which railroads operated which routes and what prices they were allowed to charge. The Staggers Act, named for Representative Harley Staggers (D., W.Va.), removed those powers, preventing freight rail from reaching the same fate that passenger rail had reached nine years earlier: federal takeover. Railroads were allowed to close down unprofitable routes that the government had been forcing them to operate, leaving them more money to invest in their fleets and infrastructure. The rates freight-rail customers paid declined while railroads’ profitability increased, and the U.S. today has by far the largest freight-rail network in the world.
Michael Derchin reported the results from airline deregulation in 2022:
Since deregulation, average domestic round-trip real airfares have plunged about 60%, to $302 from $695. Load factors — the percentage of seats filled on each flight — stood at 84% just before the pandemic, compared with 55% before deregulation. In the early 1970s, 49% of U.S. adults had flown. In 2020, the share was 87%.
And Jerry Ellig reported the results from trucking and freight-rail deregulation in 2020:
The quality and safety of rail service improved noticeably as the Staggers Act allowed railroads to negotiate service reliability guarantees. By the mid-1980s, railroad delivery time fell by approximately 30 percent, along with the variance in delivery time. Shippers saved between $5 billion and $10 billion annually due to improved rail service, which substantially reduced the amount of money tied up in inventories. . . .
For trucking services . . . deregulation saved shippers $7.8 billion annually due to lower common carrier rates, $6 billion due to lower private carrier costs, and $1.6 billion annually due to more rapid service. By 1998, real operating costs per vehicle mile fell by 75 percent for truckload carriers and by 35 percent for less-than-truckload carriers.
None of these three laws deregulated safety rules in these industries. They only deregulated economically, and that deregulation helped contribute to increases in safety. Companies no longer had the government erasing their profitability through economic controls and could use their profits to invest in safety. Airlines, trucking, and freight rail are all much safer today than they were before these laws were passed.
While Carter signed the law that eliminated the CAB, he also set in motion the eventual elimination of the ICC, which was achieved by a 1995 law signed by Bill Clinton. Removing these agencies’ economic power and then eliminating them entirely are some of the best decisions the federal government has made in living memory.
It wasn’t just Carter: Staggers was a Democrat, and the transportation-deregulation push was led by Ted Kennedy in the Senate, who was aided by committee staffer Stephen Breyer, who would later become a progressive Supreme Court justice. These three laws all passed Congress with large bipartisan majorities, but credit where it’s due!
Progressives today are the ones who don’t want to give Carter and other Democrats credit for these laws. They view them as part of the “neoliberal hegemony” myth that says government has actually gotten smaller since the 1980s, and deregulation has been the norm. (In fact, these three laws were outliers amidst the general growth of government over the past few decades.)
While Carter appointed the economists Kahn to the CAB and Darius Gaskins to the ICC, progressives today think government should ignore economists, as stated in Zephyr Teachout’s Hewlett Foundation-supported Atlantic article, “Sometimes You Just Have to Ignore the Economists.” Former Elizabeth Warren adviser and current Vanderbilt law professor Ganesh Sitaraman wants the government to re-regulate the airlines. The unions still can’t stand the consequences of trucking deregulation and want the government to hinder the competition from independent contractors to make it easier to unionize truckers. Railroads remain villains in the progressive imagination, and Democrats on the Surface Transportation Board want to bring back government mandates that affect routing.
If these progressives got their way, they would be undermining one of the only positive parts of Jimmy Carter’s legacy: the economic deregulation of air and surface transportation. Let’s hope they never do.
Dominic Pino is the Thomas L. Rhodes Fellow at National Review Institute.
Reprinted with Permission from NationalReview.com – By Dominic Pino
The opinions expressed by columnists are their own and do not necessarily represent the views of AMAC or AMAC Action.
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