4. What if We Left It to the Market?
Even given the evidence and arguments herein, there are some who will,
in determined fashion, continue to defend these regulations, contending that
we simply cannot leave the industry unregulated. After all, there are very real
dangers associated with having large trucks on the highways and surface
streets. Perhaps the additional risks imposed on others by the trucks’ presence
and potential lapses in safety by drivers require some form of governmental
response; however, it is worth considering whether the market might have
the potential to correct its own failures. 68 Understanding those market forces
is also important because it is precisely those forces that will be disrupted by
In the case of the trucking industry and driver fatigue, individual drivers
have significant incentives to police their own state of restfulness; not only
are their lives on the line but any accident subjects them to legal liability and
would eliminate their ability to work for some period of time. Given the low
wage rates enjoyed by truck drivers, every minute not working is a significant
cost. Likewise, their employers have significant incentives to police truck
driver behavior. Even without a shortage, an accident means less revenues
and legal liability. Given the shortage, an accident has even higher costs, as
it removes an increasingly scarce resource—a qualified driver—from the
production function, with no ready substitutes.
Market failures are always a possibility in a market economy, and there is
a chance for government intervention to improve efficiency if it intrudes into
voluntary transactions only as necessary to correct those market failures.
When government intrudes in the absence of market failures, or when it
intrudes in a way that exceeds the boundaries of the market failure, the
government will cause harm. That harm will be equivalent to, and often more
painful than, anything caused by market failures, and is appropriately referred
to as a government failure.
The shortage of truck drivers, with its attendant harms to potential truck
drivers who want to work, employers who want to hire them, and every
consumer and business who pays more for less, is a prime example of
government failure. Government regulations go well beyond what would be
needed to correct negative safety externalities, the only legitimate market
failure in the industry, and offer no apparent safety benefits. While some uses
HIGHWAY LOSS DATA INST. (Feb. 2016), http://www.iihs.org/iihs/topics/t/large-trucks/fatalityfacts/large-trucks. Driver deaths have also decreased over time, but experienced
a slight rise in 2011, 2012, and 2013. Id.
68. WINSTON, supra note 5, at 76.