Independent Truckers-Financial Times Call for a New Route

My father was a "wildcat" before he was able to secure a position with a large freight company. It came with all the trappings of a union job that tended to make life easier for our family. And while he went through his share of organized, sanctioned strikes he never forgot from where he had come. There were some wildcat strikes in the 1970's and 1980's, strikes by Owner/Operator truckers, that he observed unofficially with sick days and vacations. He would reflect on his wildcat days with some fondness and some pain. It wasn't easy back then, either. The taxation (overt and covert) and safety regulations weren't near as tough as they are today for the independent hauler, but at the time, still something to complain about.

Earlier this month I came across an article from an Associated Press writer (projo.com) that painted a bleak outlook for the independent truck driver. The writer reported that one driver's costs had doubled and that many were on the verge of bankruptcy. This quickly brought to mind the Rockefeller quote, "Small business is a sin." Is this yet another attempt to push independent business owners out, clearing the way for large corporation to monopolize another market? I suppose this plan has been in motion for several generations and my thought is certainly not an original one. However, with the weakening of the U.S. Dollar, rising energy prices, escalating insurance, and the many woes facing today's independent freight hauler one can't help but surmise that there seems to have gained even more momentum since the turn of the century. I would point to the writer's own research to back that up. "Re-possessor Nassau Asset Management repossessed 110 percent more trucks in 2007 than it did in 2006, according to president Edward Castagna." (projo.com)

The situation that independent truck drivers find themselves in may be not only suggesting, but screaming for a new approach to the industry as a matter of survival. It may be time for an approach that is used by the competition. Corporation formation, your own corporation formation, may be the next step in the independent hauler's evolution. Incorporating one's activities offers a level of protection not found in the role of "sole proprietor." Just ask GMAC, Nissan, General Motors, Kodak, and the list goes on. I'm not just suggesting a domestic corporate structure here, either. Again, I reference the companies I just mentioned. Working on the apparent prevailing thought that tourists or visitors are treated much better than the resident citizen, why wouldn't it be advantageous to be employed by a foreign company? I'm just saying...

A good friend of mine and Houston Attorney Alexander Hay III, recently wrote an article about jurisdiction (Alexander Hay) and how the everyday independent business person can use jurisdiction to his or her advantage. Basically, a person in the Land of Nods, a nasty little business tax unfriendly nation, decides that opening a corporation in the Island of Ahs, a little government that taxes only that business income that is produced within the boundaries of it's borders or jurisdiction, could be a plus! The new corporation in the Island of Ahs then does business in the Land of Nods, a nation that seems to allow other nations to move around the safety equipment, taxes, and other artificial revenue producing enhancements that it imposes on its own citizens. The new business from the Island of Ahs hires this person to do business and produce receipts for a small salary that isn't taxed as heavily because it winds up in one of the "lower tax brackets", but also provides the new "employee" with an expense account funded by an account in the Island of Ahs for expenses such as fuel, meals and entertainment, equipment and the like. The new corporation in the Island of Ahs has also gone into the leasing business! The Island of Ahs corporation has purchased a new fangled widget hauler that it leases to our new employee. The vehicle has been purchased with funds made free and clear in the Land of Nods and deposited into its private Credit Union, of which our new employee is a member. Now the Corporation in the Island of Ahs still must withhold the employee's taxes and and pay a quarterly income tax for the employee, but the salary is so low that it really doesn't amount to much, anyway. Do you you see where I'm going with this? Granted, there are a few more things to consider as it is applied to one's own situation, but this gives you an idea of jurisdiction and the power it holds within.

The independence and freedom that was certainly felt when that burly, sun dried pioneer first hired out his Conestoga Wagon to help settlers to the interior of the "New World" is fast disappearing from the North American landscape. With this loss the freedom lover in each of us diminishes just a little bit more until finally we become indentured to and contented to be controlled by huge conglomerates and overpaid CEO's. Exactly the kind of people we sought to avoid when we started searching for something better, not only for ourselves but our families.

A little planning and research can go along way towards independence. An association with people in the know, international financial and legal experts can mean the difference between surviving and thriving...or between freedom and servitude. A way of life is disappearing and believe me, it's no accident. The unions were the first casualties and the independent business person is next.