Wednesday, June 27, 2012

The Luck of the Draw, Branding and the Law of Large Numbers

In explaining SMS methodology to the TIA in June, Associate Administer Bill Quaid stated something on which we can all agree:
“There is no reason not to use an unrated carrier just because they have no score.  They’ve done nothing to trigger an audit and they aren’t on our radar screen for safety problems.  I would have no problem in using them.”

Since SMS methodology only measures 97,000 out of 650,000 carriers (more or less), Mr. Quaid has thus acknowledged that 88% of the motor carriers the FMCSA authorizes to operate can and should be used by the shipping public.
Since the first 97% of carriers regulated by the FMCSA operate 20 trucks or less, it follows that the vast majority of small carriers can be used without fear of negligent selection even though they have neither been audited nor subject to sufficient roadside inspections to receive a safety rating or an SMS score.
Woe be it, though, to the small carrier that crosses the scales with minimum frequency necessary to be placed on the Agency’s “radar” and achieve a ranking.
Once a carrier is in the system, it is graded on a curve and stands a greater than 50% chance of being branded as somehow unfit under the SMS methodology which the Agency touts. Branding carriers in this manner without due process, it makes no difference whether the carrier has ever been involved in at-fault accidents.  And the effect of branding is not removed for the carriers the Agency actually audits and awards a satisfactory safety rating based upon objective standards required by statute.
With respect to the over 400,000 unmeasured carriers, Mr. Quaid’s statement is correct.  Unless a carrier has been placed out of service or received an unsatisfactory safety rating, under the existing regulations it is fit to use on the nation’s roadways and the shipping public should be able to use it without fear of lawsuit.  Yet, shouldn’t the same legal standard apply to the 53,000 carriers that the unvetted SMS methodology selects for further monitoring?

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