Posts Tagged ‘trucking’

A small trucking company has 5 trucks and 5 drivers. Each driver travels 700 miles on an average day going the established 70 mph speed limit and driving the maximum 10 hours per day allowed by law.

To save fuel, the government decrees a new reduced speed limit of 55 mph. Now each of those truck drivers can only travel 550 miles per day in the same 10 hours. That is a reduction of about 20% in work accomplished for each driver.

Now, these drivers have contracts and commitments to their customers to maintain. The demand for work did not reduce with the speed limit. They cannot physically deliver the same amount of products as they used to, but the same amount needs to be delivered somehow. Therefore, they will need to hire a 6th driver and a 6th truck to make up for the 20% less work the 5 current drivers are doing. However, the 6th driver is not going to work for free, and the truck will cost a lot of money that must be taken out of the general profits of the other 5 truck drivers.

By lowering the speed they drive, the truck drivers are saving about 3% in fuel costs, which is good, but they must still keep their commitments to their customers. Therefore, the 6th driver, still needs to be hired, and the new truck bought, but he will have 15% less work to do. The trucker’s union will demand he get paid the same, or that the work is evened out among all six drivers, so the net result will be that all the truck drivers will get a 3% reduction in pay in addition to accomplishing less work.

However, this 3% in fuel savings is more than negated when factoring in the cost of fueling the 6th new truck, which will consume the same amount of fuel as the original 5 trucks. The trucking company’s fuel costs, and the amount of fuel burned, will actually go up 5%! (20% reduction in efficiency = purchasing and hiring to make up that 20% minus 15% in fuel savings = 5% more fuel consumed.)

Now, multiply this by thousands of trucks and trucking companies, plus the energy (and fuel burned) to produce additional trucks that were not previously needed, plus the cost in inefficiency in having to spend time and resources in find and train new drivers, and you will see that the reduced speed limit actually caused the consumption of more fuel, accomplishing the exact opposite of what was intended by the law. And, this is only within the trucking industry! The cost in fuel and time resources in all other industries and private life is incalculable!

This is a classic example of the government stepping beyond its natural bounds. The government did not create the market or the need for products to be transported—people did. These needs and desires are the product of millions of people making millions of decisions to better their lives or just survive. No entity or reduced sampling of this whole population (such as a legislature, president or king) can factor in all the variables involved in laws intended to adjust the will of the whole people. I would almost suspect it to be even outside God’s power—almost.

Material gain, economic security, and conservation of resources cannot be guaranteed by any government. They are the result of work. Unless the bread (or service) is produced, it cannot be distributed or accomplished and government does not produce—people do. That is all the people and all the factors. Any attempt to improve one facet of society by force of law will have ripple effects on everything else in that society. It may indeed improve (temporarily) that particular facet, but always at a higher cost to the rest of the society. Like the waves from a stone of favoritism thrown into a pond, the disruption spreads in ever winder and wider circles until the whole pond is effected and must consume energy to return to the previous state.

An unnatural favoritism is introduced for one segment of the whole (in this case the saving of fuel) which disrupts the progress of all other segments leading to the demand for favoritism in them. That sixth truck driver, though only the result of a law, will demand equal treatment. To pay his salary, the trucking company—to remain competitive—had to layoff their bookkeeper. Now all the divers must keep their own books in addition to being paid 3% less. The drivers therefore demand more pay, go on strike, the company pays them more, is no longer competitive, looses customers, must layoff drivers, trucks and their value are wasted by sitting idle, and on and on.

Incidentally, one of beauties of capitalism, is that when a company or person fails or succeeds, you can’t usually find the reason—it is the product of too many factors. But, when the government creates laws to control the will of the people, like a monkey wrench thrown into the machine, we all have something specific to blame or reward. Tis much better to know that the whole pond contributed completely unintentionally to our condition than to have focused anger or praise.


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