April 19, 2010
thought leaders | The DC Velocity Q & A

A lobbyist's-eye view of the Washington transport scene

Two decades after leaving DOT's top job, James H. Burnley remains plugged into the Washington transportation scene. And he's concerned about some of what he sees.

By Mark B. Solomon

If political ideology were a condition for employment, James H. Burnley IV would never have gotten a foot in the door at the white-shoe Washington, D.C., law firm he now works for, Venable LLP.

Venable has deep and enduring liberal roots; its senior partner, Benjamin R. Civiletti, served as attorney general in the last two years of the Carter administration. By contrast, Burnley, who heads the firm's transportation practice, is an unabashed conservative who cut his teeth in the Reagan administration and whose work both in and out of government has been largely informed by that experience.

But competence and influence often trump ideology, and there is little doubt that when it comes to knowledge of transportation law and the ability to effectively lobby for client interests, few can match the 61-year-old Burnley.

In 1983, Burnley was appointed deputy secretary of transportation under Elizabeth H. Dole. In 1987, Burnley was named secretary of transportation, a post he held for the last two years of President Reagan's term. Since leaving the Department of Transportation (DOT) in 1989, Burnley has remained a key player in transportation matters as a lawyer and lobbyist, all the while remaining devoted to the free-market principles that defined his time in government.

Burnley spoke recently with DC Velocity Senior Editor Mark Solomon about the DOT then and now, similarities and differences in presidential administrations, and his stand on key transport and infrastructure issues.

Q: You've been out of government for more than 20 years. How has life been on the other side?
A: Life, in general, has been good. I've been able to stay involved in transportation policy issues, which is what I enjoy. While the pace is still intense, it's not as intense as it was at DOT. That was a six-and-a-half day a week pace. This is much more civilized.

Q: As you look at the scope of the DOT then and now, and the transportation industry then and now, what has been the biggest change at DOT and in the transportation world in general since your time at the agency?
A: The biggest set of changes at DOT occurred as a result of 9/11 when the [Department of Homeland Security (DHS)] was created, the Coast Guard was moved out of DOT, and what responsibilities the department had in aviation security were moved to DHS. In terms of the shape and scope of the DOT, those are the biggest events of the past 20 years. I think virtually everyone would agree that DHS is a work in progress. It's had some very able leadership, but it's such a disparate set of agencies, and there were so many differences among the agencies that were thrown into DHS. It's fair to say that if Congress had to do it over again, it might think through whether that's what it wanted.

In the transportation world, the biggest events have revolved around the continuing evolution of economic deregulation. When I was at DOT in the 1980s, the transportation industries were just beginning to shape their response to the changes that had taken place from 1978 to 1980 [when airlines, railroads, and truckers were deregulated]. At this point, we've hit a plateau. These are still dynamic industries, but they've plateaued as dynamic industries. The dynamic is mature.

Q: It's been 30 years since the railroad and trucking industries were deregulated. How would you judge that evolution?
A: I think it's been enormously favorable. The average American is much better off. The prices we pay are lower than they would otherwise be because the logistics cost component of the things we buy is lower than it would otherwise be.

Q: How would you rate the Obama administration in its handling of transport issues up to now?
A: One point of frustration is that they are reopening a rulemaking on truck drivers' hours of service. [The regulations] have already been through three iterations. There is a great danger they will go through several more now that they've reopened it.

That said, the challenges the administration has inherited are very substantial. We are in an extraordinarily difficult and somewhat unprecedented period in the history of the federal role in transportation. Before [DOT Secretary] LaHood got there, the highway trust fund collapsed. Today, we are seeing multibillion dollar transfers of funds from the general treasury because fuel tax and excise tax receipts aren't enough to fund existing programs.

Secretary LaHood also arrived just as President Obama said he wouldn't consider an increase in fuel taxes because of their regressive nature. This has put the secretary in a very difficult position.

Q: Highway funding reauthorization is living on a series of short-term extensions. Do you think it's possible that we may not have a multiyear reauthorization bill by the end of President Obama's term in office?
A: I started saying a year ago that we were facing four years of short-term extensions of existing programs, and I'm sorry to say this is a prediction that I believe will come true. It will be especially difficult for the Obama administration and Congress to agree on a solution to the trust fund crisis if the political environment holds in November and we have more Republicans occupying both Houses who are skeptical of higher taxes of any kind.

What worries me is that the whole concept of the trust fund is breaking down. You can't make the argument with a straight face that the trust fund should be spent just on transportation programs and that it should be walled off from the appropriations process while at the same time getting huge sums of money from general revenues. That is a corrosive process. By 2013, we could find the whole notion of the trust fund obsolete.

Q: The conventional wisdom is that the controversial "cap and trade" provision contained in House-passed climate change legislation has been killed by the election of Massachusetts Republican Scott Brown to fill the late Edward M. Kennedy's Senate seat. Do you see new language emerging from Congress with the same carrot-and-stick approach as cap and trade?
A: No. I think you may have legislation that has carrots in it, but not the sticks. The real inequity with cap and trade was that about one-third of revenues were going to come from transportation, but not a dime of that money would go to the Highway Trust Fund. Cap and trade is nothing more than a huge floating excise tax increase. That said, I think Congress will continue to work on incentives to drive us toward greater energy independence.

Q: What advice are you giving your clients on how to manage through the current legislative and regulatory environment?
A: This is an administration with very few senior officials who have any experience in the private sector. And that's across the board, not just at DOT. The business community has realized that pretty quickly. It is spending a lot of time and effort educating officials on the real-world impact of the policies they want to put in place. Look at the proposal to reopen the hours-of-service debate. DOT has said it will reopen the rulemaking, but it hasn't put a proposal out there. The department has been listening to stakeholders to determine what the practical implications [of reopening the case] might be.

Q: Do you have a feel from your clients that they are concerned about what is coming out of DOT?
A: Any time you have an activist administration—and this one certainly is—and you are in the regulated community, you have to be concerned about this. But it was the same way in the Reagan administration. We were very active, and we had a lot of ideas. And the people we regulated were very outspoken about the real-world impact of those ideas. I will say that the DOT today has an extraordinarily dedicated and talented group of career leaders. The department has a remarkable track record of holding on to really talented career civil servants at the senior level, because they love what they do. I think of people like (Rosalind) "Lindy" Knapp, who was deputy general counsel when I joined DOT in 1983 and is still in that role. These are the people who are the backbone of the department. They are the most talented cadre of senior civil servants that I know of in the entire federal government.On the political level, the department's leadership is also very impressive. Ray LaHood knows what he's doing. He's been involved in public policy issues his entire adult life. The bottom line is that DOT is well led at the political and career levels.

More articles by Mark B. Solomon

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