SACRAMENTO, Calif. — In a normal state, policymakers who are facing a crisis (let alone myriad crises) would at least have the wisdom not to purposefully try to make things worse. Here in California, not so much. Gov. Gavin Newsom and the state Legislature have doubled down on their enforcement of a new union-inspired labor law that is complicating the ongoing supply chain disruptions.
At this writing, truck drivers are blocking the Port of Oakland out of frustration with the law, which would upend the way they do business. First, a recap.
In 2019, the governor signed into law Assembly Bill 5, the so-called “landmark” legislation that essentially bans independent contracting (and which the Biden administration still sees as a national model). The law targeted drivers for companies such as Uber, Lyft, and DoorDash, but — and it’s a matter of debate about how far lawmakers expected the measure to go — it threw the entire freelance economy into a tizzy.
As I’ve reported before for The American Spectator, AB 5 eliminated jobs for freelance writers, photographers, sign language interpreters, and people working in hundreds of job categories. Professionals with the best lobbyists — attorneys, dentists, insurance agents, realtors, etc. — carved out exemptions in the original bill. But local theater groups and musical gigs had to shut down given that these performers generally work independently.
As AB 5 left a trail of wreckage, Californians of all political persuasions were angry as it instantly destroyed their livelihoods.
Ultimately, the Legislature succumbed to pressure and passed over 100 additional exemptions but refused to repeal the law and continued to boost its enforcement budget. Again, to a normal person, it is the mark of particularly bad legislation when lawmakers must exempt most people from its edicts to avoid a mutiny. The state’s voters then approved Proposition 22 in 2020 to exempt rideshare drivers. An Alameda County judge voided the measure, which now is pending appeal.
The state’s brain trusts, however, failed to address AB 5’s most far-reaching consequence. It also applies to truck drivers — you know, the folks we depend on to deliver virtually everything to everyone. Under AB 5, truck drivers must generally be permanent employees of the trucking company (although it allows some costly workarounds).
Many truckers don’t want to be employees and prefer to work as owner-operators. Being an owner generally is preferable to being an employee, but why should that matter to Sacramento politicians who know better?
In the meantime, the nation’s supply chain faced severe disruptions thanks to those ill-thought-out pandemic restrictions. Since AB 5’s passage, another crisis took hold: Container ships started backing up at the ports of Los Angeles and Long Beach, largely because of an insufficient number of truckers to unload the goods and move them to their destination.
As a backdrop, the state also (over several years) imposed new diesel rules that require truckers to buy costly new equipment, which has chipped away at the number of trucks on the road. That’s the long backstory to what’s now going on at the Port of Oakland, as protesting truckers have halted business at one of the West Coast’s busiest ports — primarily out of their anger at AB 5. Drivers have blocked traffic entering and leaving the terminals.
The law’s implementation had been on hold pending the outcome of a California Trucking Association lawsuit challenging AB 5 largely on interstate commerce grounds. It is a reasonable challenge — one I honestly thought would succeed — given that the California law forces interstate truck drivers to stop at the state line and transfer cargo to trucks driven by permanent employees. But the U.S. Supreme Court refused to review the case, although other litigation continues.
“The protests at the Port of Oakland gates mark the latest disruption to hit U.S. ports since the impact of the pandemic upended trade flows in 2020, triggering big backups at Southern California ports as companies rushed to restock inventories and the gateways struggled to handle surging container volumes,” the Wall Street Journal reported.
The governor, who rarely misses an opportunity to hold a press conference lecturing other states on their social policies, has less interest in embracing measures that fix problems at home. What kind of state government imposes such laws in the midst of a supply chain crisis? Certainly not a normal one.
Steven Greenhut is the Western region director for the R Street Institute. Write to him at sgreenhut@rstreet.org.
