Transportation Secretary Sean Duffy is playing hardball with Minnesota Governor Tim Walz, and the stakes are $30 million in federal funding. The issue? Illegally issued Commercial Driving Licenses that Duffy says turned the state's trucking industry into something resembling the Wild West.
Fix It Or Lose The Money
In a post on X this Monday, Duffy didn't mince words. The Department of Transportation found that approximately one-third of Minnesota's "non-domiciled CDLs" were issued in violation of federal regulations. "MINNESOTA: You're on notice. You have 30 days to fix this or lose $30 million in federal funding," Duffy declared.
The Transportation Secretary also announced that all CDL schools and training centers in the state have the same 30-day window to get their operations in line with federal rules or face closure.
"The days of a 'Wild Wild West' trucking industry are over under the Trump administration," Duffy added, making it clear this isn't just about Minnesota.
A Pattern Emerges
This isn't Duffy's first rodeo threatening Democratic governors over CDL issues. Earlier this year, he clashed with California Governor Gavin Newsom after an undocumented semi truck driver with a California-issued CDL made an illegal U-turn on a Florida highway, killing three people. That confrontation led to Duffy threatening to withdraw $160 million in federal funding from California, drawing sharp criticism from Newsom.
The pattern suggests the Transportation Secretary is taking a systematic approach to cracking down on what he views as lax enforcement of commercial driver licensing standards in blue states.
Could Autonomous Vehicles Fill The Gap?
Here's an interesting wrinkle: as CDL regulations tighten, self-driving technology might offer a workaround for transportation needs. Aurora Innovation (AUR) is already developing autonomous trucks in the U.S., potentially providing an alternative as traditional licensing becomes more restrictive. Meanwhile, former SpaceX employee Matt Soule is working on Parallel Systems, a startup focused on electric battery-powered autonomous freight trains.
Tesla Inc. (TSLA) could also benefit from the regulatory squeeze. The company's Semi trucks feature autonomous capabilities and impressive battery range, and Tesla has already partnered with Uber Technologies Inc. (UBER) on freight operations.
Political Tensions Run Hot
The CDL dispute adds another layer to the already frosty relationship between Walz and President Donald Trump. The Minnesota Governor recently questioned Trump's health following an MRI scan, saying "It's clear the president's fading physically" in an interview. The comment came after Trump directed some harsh words at the Governor, keeping the political temperature between the two at a steady boil.