Newspaper article St Louis Post-Dispatch (MO)

Outdated ICC Can't Regulate Itself Away

Newspaper article St Louis Post-Dispatch (MO)

Outdated ICC Can't Regulate Itself Away

Article excerpt

Vice President Al Gore has no monopoly on ideas for reinventing government. Sen. John Danforth, R-Mo., offered up one of his own last week, but the Senate rejected it.

The fate of Danforth's proposal, which called for dismantling the Interstate Commerce Commission, says a lot about the difficulty of reinventing anything in Washington. Each agency has a well-entrenched constituency, both inside and outside of government. The regulators have built careers around having something to regulate. In a sense, industries also like being regulated - at least, they like the idea that of a regulator that can be co-opted and made to serve their interests.

A whole branch of economic thought, called public-choice theory, has grown up around the study of this symbiotic relationship. The forces in favor of bigger government are so irresistible that it takes a particularly strong political consensus to move in the other direction.

One such consensus formed in the late 1970s and early 1980s and led to the deregulation of most of our transportation industry, as well as other things like the interest rate you can earn on your bank account.

Killing the ICC, Danforth contends, is simply a matter of finishing the job started in the last wave of deregulation. After all, the Civil Aeronautics Board ceased to exist after airlines were deregulated. But the ICC lives on, more than a decade after it stopped setting rates for train and truck shipments.

In a remarkably illustrative argument for the status quo, Sen. James Exon, D-Neb., read a litany of companies and trade organizations that supported the ICC, then likened Danforth's proposal to "killing the goose that laid the golden egg."

Who gets the gold, though? Railroads and truck lines may see benefit in having a regulator of their very own, but it doesn't benefit the taxpayer, or the economy as a whole.

One of the ICC's remaining duties, for example, is to rule on railroad mergers. This could be done as efficiently, probably more so, by the Justice Department's antitrust division, which handles other mergers.

Danforth suggests that the hodge-podge of other ICC roles, such as ruling on rail-line abandonments, refereeing disputes between carriers and shippers, and making sure that each truck line has an insurance certificate, could be handed to the Transportation Department. …

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