ATA’s Chris Spear Optimistic About Trucking Economics, RI Tolling Verdict

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American Trucking Associations President Chris Spear said the trucking industry continues to show resilience despite challenges in the U.S. economy, marked by two consecutive quarters of negative gross domestic product and rate hikes. interest rates by the US Federal Reserve that aim to curb high inflation rates for decades. .

“We’re starting to see a lot of the impact of the Federal Reserve’s decision to raise interest rates, and the impact it’s really having,” Spear said during an appearance on the program. Transport Topics Newsmakers video debuting August 11. “We have 40-year inflation highs, close to 10%, and fuel records. Even though it’s going down, it’s still higher than it was a year ago, and that will definitely impact our industries and our ability to serve and help out of this. The Fed tried to hit the brakes to slow the economy, and instead we hit the emergency brake, we slide around the corners. This creates a lot of uncertainty, not only in trucking but in the whole economy.

ATA Chief Economist Bob Costello has put a 50-50 chance of a U.S. recession in the first quarter of 2023, a view that Spear says incorporates a wide range of factors. influences.

Costello

“You have to look at a number of collective factors, and I think that’s what Bob and his team really analyzed,” Spear said. “There are so many factors within the economy that remain very strong and are resisting these factors – such as inflation and fuel costs – that it gives us some hope that we can get through this very rapidly. But we still have at least three to four quarters before we see anything positive along those lines. »

Spear also said he was closely monitoring the implementation of California Assembly Bill 5, which reclassified about 70,000 drivers who were independent contractors to now be considered W-2 employees of companies. trucking. In late June, the United States Supreme Court declined to hear a challenge to the law.

“I keep saying Sacramento is the breeding ground for all bad politics,” Spear said of the California capital. “I haven’t seen anything come out of this town that has helped our industry or our economy. They continue to set standards that not only impact California, but reverberate across this region and across the country. We benefit because we are interstate commerce.

Spear expects further legal action over how the law will be implemented, as he argued it was drafted “deliberately vague”.

“It’s vague for a reason, and it’s meant to be litigated,” he said. “If you are an employer and you hire and employ independent contractors, we advise them to obtain a lawyer, to retain the services of a lawyer and to prepare for it. You don’t want to be caught off guard.

Spear expressed hope that California Governor Gavin Newsom and state officials would exercise discretion in enforcement and give the industry time to sort out potential ramifications. Especially, he noted, with the continued supply chain pitfalls and stresses along west coast ports. “It would be a very difficult time to inject another layer of bureaucracy on top of our industry’s ability to keep the supply chain moving,” Spear said. Along the East Coast, Spear is optimistic the trucking industry will prevail in a legal battle against a truck-only toll plan in Rhode Island. A federal trial run on the program concluded June 13, and both sides have since had time to file final paperwork before U.S. District Judge William Smith issues his ruling. It’s planned for later this year. “We anticipate the judge’s intent is to make a decision by September, and we’re very optimistic,” Spear said. “It’s bad policy and it’s unconstitutional.”

Spear noted that the ATA and the Rhode Island Trucking Association had been fighting the toll plan for more than four years and were thrilled to finally have the case before a judge.

“I think we held on,” Spear said. “The judge had a lot of tough questions for the state, and they weren’t able to answer them. One of the main indicators that I got rid of during the trial was the fact that our witnesses didn’t had not been cross-examined. Our witnesses were so well prepared.

Spear noted that Rhode Island could appeal if it loses in court, but pointed out that the national implications of the case justified the years-long battle since other states could consider similar plans. “If he decides in our favor, it will be a huge win,” Spear said.

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