Transportation regulation helps to maintain a balance in the transportation industry. Regulation can make or maintain competition so that there are no monopolies. In addition, regulation helps consumers of transportation by controlling pricing and making sure it is reasonable. Regulation also gives financial assistance to different sectors in order to keep them in business. Regulation can allow the government to control and even own some transportation carriers. Unfortunately, regulation can not control every aspect of every transportation mode. When regulation takes place, it is only for one mode at a time and it is different for every mode. For example, air is not economically regulated, but railroads are. .
Deregulation allows more companies access to enter into the transportation market because of easier entry restrictions. In addition, it allows for negotiation on rates rather than specific rate setting, like in regulation. Deregulation allows the individual companies to set rules. However, in doing so, it opens the door for monopolies and unfair competition.
I mostly agree with regulation because we need transportation. By having regulation, consumers and providers both are taken care of. If there was no regulation, the consumer could be charged unreasonable rates for transportation. In addition, if a smaller carrier wanted to compete with a large carrier, the company would have to drop rates so low that they could go out of business. I do think that regulation needs to be more stable across the entire industry. For example, the government is controlling prices of the railroad industry, but not at all for the air industry.
B. Motor carriers are currently not receiving direct government subsidy. However, their roads are being upkept by the government. Safety regulations are used for the carriers equipment such as trucks, railcars, etc. I think that eventually transportation carriers will have to give more money in taxes in order to help with up keep of roadways.
