Fuel Smarts

Washington Officials Focus on Diesel Prices

March 23, 2000

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Official concern about diesel prices escalated in Washington, DC, this week. House transportation leaders held hearings, truckers marched for the third time in two months, and trucking spokesmen gathered at the Department of Transportation to seek relief.
At the March 21 hearing before the House Ground Transportation Subcommittee, it was apparent that there is no consensus on how to fix the fuel price crisis, but one thing is for sure - transportation leaders do not want Congress to repeal the 4.3-cent federal fuel tax.

Witnesses at a House hearing said the tax repeal would devastate highway maintenance and safety, and produce little benefit.
Assistant DOT secretary Jack Basso said that while the Clinton administration is "deeply concerned" about the impact of fuel prices on trucking, a tax rollback would take $1.4 billion out of the Highway Trust Fund this year - and $7 billion each year thereafter. This would lead to higher operating costs as the highway system deteriorates, he said.
"Individual drivers will save more than twice as much in the long run if the revenue from the 4.3 cent tax is invested in highway improvements, than if the tax is repealed," he said.
Repeal also would cut into DOT's safety budget, reducing it by a third, he said.
Witnesses from the states, the highway construction industry, the transit industry, labor unions and the American Automobile Assn. all made the same points - as did the members of the subcommittee.
Meanwhile, trucking spokesmen were divided on how to bring down prices that are forcing some truckers out of business.
Jim Johnston, president of the Owner-Operator Independent Drivers Assn., pressed for a national surcharge that would be passed on to the trucker who pays for the fuel. Walter McCormick, president of American Trucking Assns., urged that fuel supplies be increased by opening the Strategic Petroleum Reserve.
Johnston and McCormick found little common ground. Johnston said there was no guarantee that opening the reserve would lead to lower prices, and McCormick said a surcharge would only pass costs along to someone else. They did agree, however, that the Clinton administration should press the Organization of Petroleum Exporting Countries to increase production.
OPEC ministers are scheduled to meet March 27 to consider increasing production.
The day after the hearing, hundreds of truckers converged on Capitol Hill seeking relief, the third such demonstration since February.
While the previous demonstrations had been organized by business groups representing owner-operators, this one was organized by the Teamsters union on behalf of independent drivers at port facilities.
"These men and women (drivers) are being forced to choose between food on the table and fuel in their truck. This is not a fair choice,"' International Brotherhood of Teamsters President James Hoffa said, according to news reports.
"I call on Congress to help the American trucker during this national fuel crisis," Hoffa said.
He called for legislation holding members of OPEC accountable for production policies. OPEC nations should be more grateful to the United States for sending soldiers to the Middle East "to save their hides" during the Persian Gulf War.
"That's a heck of a way to show their gratitude, by jacking up these (petroleum) prices," Hoffa said, echoing a theme that has been sounding throughout the fuel crisis.
Today, leaders of trucking trade groups are scheduled to meet with DOT Secretary Rodney Slater to air their concerns and press for relief. Among those attending the listening session will be Jim Johnston of OOIDA and Walter McCormick of ATA, as well as Tim Lynch, president of the Motor Freight Carriers Assn., and John McQuaid, president of the National Private Truck Council.

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