ITTS Newsletter – January 2012

January 20th, 2012

Greetings:

I hope everyone had a wonderful Holiday and are in the process of breaking or ignoring their New Year’s Resolutions. Here is the January 2012 Newsletter!
The swing of the new year finds me planning for my third “Freight in the Southeast” Conference.  I am putting the touches on hopefully another great meeting, and look forward to seeing everyone on March 14-16, 2012 in Norfolk, Virginia.  You can learn more about the conference at http://www.ittsresearch.org/ITTS_2012_conference.html.

ITTS Conference
Trade with North Korea
What is… Longshoreman
Lambert’s Lagniappe
News Update

Hope all is well with everyone!  And I look forward to seeing you in Norfolk.

Bruce

Do Rankings Influence A City’s Business Attraction?

December 13th, 2011

MarketWatch just ranked Washington as the top city for doing business (based on 102 cities with populations exceeding 500,000 people).  (You can read the report here.)

How did the Southeast fair?  Well, not very good, as only Richmond, Durham, Nashville, and Raleigh were listed in the top 25 cities.  New Orleans was the fastest growing cities on the index (you can read their take on this here).  Based on their rankings, the Southeast region did better in the Company position (based on how companies contribute to local economies), but not the economy position (employment, jobs, wages, etc.).

This is somewhat contrary to the various reports about the business climate in the Southeast has been improving, as discussed by various Site Selection and business rankings. This suggests that there are many different ways to look at business activities.  In the long term, businesses tend to focus on traditional site selection criteria (workforce skill sets and availability, incentives, transportation and access to costumers) but it can be argued that any business ranking reflects what has already occurred, based previous legislative and business climate.   The real question is what are these regions doing now to  improve their rankings, based on the collective actions of both the public and private sectors.  2012 does not appear to be shaping up as a barn burner, so working on strengthening existing regional business ties will become more important.

 

Christmas Trees a Click a Way- A New Way to Retail?

December 2nd, 2011

USA Today ran an article about fresh Christmas Trees that are purchased online.  The article suggests that while a small portion of the overall Christmas tree market, it indicates once again how dependent we have become upon purchasing our products online, ultimately relying upon  logistics and transportation systems to meet our expectations (and compressed schedules).  (We can add that to growing list of other things one can purchase online, as well as costs associated with internet based business sales taxes!)

From a transportation framework, I do not know if the trees are actually cut later to the shipping date, ensuring a fresher tree than sold at a traditional Christmas tree lot, or if they were cut at the same time and are sent to a warehouse location.  I will have to research that a little more!

We are witnessing the transformation of retailing and shopping, which can bear out concerns for the future of transportation.  There exist discussions that the traditional shopping and strip mall may not be as viable in the future, which is evident by  many firms limiting store front merchandise with online catalogs (are we back to the general store with a clerk in the front and clerks running in the stacks to bring your goods?).  It is also unclear what this will mean for retail land development.

One thing to remember, be safe this Holiday.  Any Christmas tree could catch on fire, as attested by this video by “Tom Heinl – Christmas Tree On Fire” or Cledus T. Judd “This Trees on Fire“.  In fairness, the National Christmas Tree Association argue about benefit of real versus  artificial trees here including the question of flammability.

ITTS Newsletter- November

November 28th, 2011

Got the November newsletter finished, and posted online.    Hope you enjoyed reading about trade agreements and my usual updates!!

Bruce

Congestion and Corridors- It is growing!!

November 28th, 2011

Recently, Texas Transportation Institute issued The 2011 Congested Corridors Report.   By using a corridor as a three mile stretch, they look at traffic flows along 328 corridors.   Of these corridors, which accounted for 6 percent of the nation’s total freeway lane-miles but generated 36 percent of the urban freeway congestion.  They also accounted for 8 percent of truck activity, but 33 of truck freeway delay.  As with other studies, they note that it is unreliability more so than simply traffic volumes itself that places a greater burden on the traveling public.
The growing spread of congestion and its influence on traffic is not necessarily new, as both Federal Highway Administration and American Transportation Research Institute (ATRI) have estimated trucking bottlenecks in the past.

 

Clearly, as traffic congestion occurs.  TTI suggests that solving congestion is not necessarily a single problem, but would take many solutions.  In this regards, they are correct, although most people see this as a federal response to local planning and transportation decisions.  Unfortunately, I think the locals are going to have be more aggressive in finding solutions to congestion despite discussions in MAP-21 and TIGER programs.   (Curious if this will be discussed at the talking freight on MAP-21 in a few weeks.)

 

The Story Matters

October 5th, 2011

Recently, I listened to “Tell to Win: Connect, Persuade, and Triumph with the Hidden Power of Story” by Peter Guber on audiobook (who has time to read?).  In the book, Mr. Guber lays out  how knowing your audience, having a clear message, and getting others to believe your story are critical for any successful project.  Based on his long career in the entertainment industry, he has quite a few stories to tell (and he does like to drop names, so you have been warned…).  The irony about telling stories depends upon knowing what you want to tell and how you want to resonate with your audience.  Clearly, in the discussion about the future of the American economy and values, we can all paint various pictures of the American we want to live in: one that expresses our own belief about the “What” of the American Experience.

In reflected in the value of story, I have found that we struggle with the story of transportation:  is it a story about livable cities and sustainable local communities connected by high-speed rail or airplanes, a story of freight mobility and global supply chains, or a story of balancing reducing environmental concerns while balancing emissions/land use activities.  (Some of these topics related to putting freight into the planning story were discussed at the APA session organized by Noel Comeaux.)

In every framework, the story depends upon what motivates you and you audiences.  Several years ago, I read “The Southern Advantage: Why You Should Consider Doing Business in the Worlds Fourth-Largest Economy”  by J. A. Hollingsworth Jr.  Its a fairly quick read, and was written prior to the recent economic collapse, but his message still remains:  the Southern U.S. is open for business.  A recent issue discusses some of the trends Mr. Hollingsworth addresses concerning regional manufacturing.  The story about manufacturing remains a mixed bag as the region shifted from textiles to autos but certain Southeastern States, such as South Carolina and Kentucky have large portions of the economies tied to manufacturing.

The question now is: Can we find a story about transportation that balances all this conflicting storyline about jobs, the environment, trade, mobility and sustainability, in a manor that fits within in the new reality of constrained budgets?   This story should include discussions on who pays, and why, as well as what the obligations are between various parties.  The recent decision of Virginia to toll I-95 as well as other discussions concerning heavier or larger trucks (truck productivity) suggest that the real meaning of transportation depends upon your own desire for the system you want.

But this is not a new question, as Thoreau brought up the following in “On Walden“:

To make a railroad round the world available to all mankind is equivalent to grading the whole surface of the planet. Men have an indistinct notion that if they keep up this activity of joint stocks and spades long enough all will at length ride somewhere, in next to no time, and for nothing;

Given the complex framework of transportation, sometimes I think we have ended upon in legal morass where all transportation projects seem to fall into a “design, approve, and defend” process.  Clearly, the role of planning, with its many different groups, should inspire the formulation of a regional or local vision that follows more the lines of “partnership, approve, benefit”.

The role of the story, or vision, is necessary for realigning our expectations regarding transportation.  Maybe Mr. Guber can make a movie about that…

 

Energy Policy and Transportation

August 15th, 2011

In discussing the future of transportation, it is important to understand that large part of the U.S. transportation involves the movement of energy.  But it is in the use of that energy that we are able to enjoy “the American way of life”.   It is clear that the availability of energy will largely shape our economic future.

Here is a new video from the PACE Institute. http://unpluggedmovie.com/  (I met with Lance Brown when he was filming this video in New Orleans and he spoke at the  ITTS Conference in Memphis.)   He raises the question that new energy policies should not ignore the costs to consumers when considering new options.  Such considerations are important, especially when considering new policies.

This does not necessary appear to be a contrast to the broader question about the future of energy, as highlighted http://www.theoildrum.com/ or by Chris Martenson.  Mr. Martenson suggests we are past peak oil, and the future of energy will dramatically change over the next twenty years from increased competition and misaligned expectations regarding energy policies and availability.  (This was one of the four scenarios “One World Order” outlined in discussed at the AASHTO/Freight Partnership meeting.

These discussions about energy production and use suggest that a discussion on energy, ranging  consumer and business costs, cargoes carried and mode, to social costs (externalities) of transportation (emissions, noise, etc.) such as in GAO report 11-134,  and pipeline safety, are just as relevant when discussing energy policy as is the creation of the energy itself.

 

 

 

Lambert’s Lagniappe-Mowing the Grass and Infrastructure Maintenance

August 15th, 2011

As I was mowing my grass last weekend, I was thinking about home maintenance. I often joke about just paving the front yard and painting it green, but I don’t think my wife would find it attractive, and grazing sheep are definitely out of the question. So, here I am yet again, mowing the yard. While I could outsource my lawn maintenance (especially when it’s roaring hot outside) I choose not too for many reasons. This means that I must find the time to do the required yard work. When I bought the house, I knew I would be responsible for the yard; for basically, any asset you own, owns you.

Like any homeowner, the public sector is responsible for the maintenance of highways, waterways, or airports. It is often easier to find money to do something new (such as buy a house), but it is in maintenance issues where the challenge exists, as you have to balance your budget and your time.

When we consider transportation investment, we often focus on the positives—the access to new markets, mobility, and economic development— and hope that the transportation system that we operate today will provide those opportunities tomorrow. In a recent TREDIS run I conducted on the Commonwealth of Kentucky, a one-time permanent reduction in total transportation costs of 0.5% would lead to an average annual net gain of 500 new jobs added over the next thirty years. Such numbers sound good until you realize that it assumes these jobs will likely depend upon some transportation network.

It is easy to ignore the fact that a mature system requires more maintenance; just like any house still needs the grass cut and beds weeded. On second thought, I should pattern my yard maintenance on the public sector example. I will not spend any time on yard work not directly involved in planting new plants while ignoring existing plants (highway construction or maintenance) and spending no more than, say 30 minutes or so a week on total yard work (that seems to be how the nation incrementally funds the Corps’ major rehabilitation or dredging projects). I am sure that my wife and neighbors will understand that I have better things to do than yard work, especially once football season kicks off.

 

2011 Midwest Regional Panama Canal Conference Shifting International Trade Routes — Examining The Impact Of The Panama Canal Expansion On The Midwest Region – May 11-12

May 15th, 2011

ITTS was invited to speak at the Midwest Regional Panama Canal Conference in Paducah Kentucky.  The meeting was held in the Carson Center, which is a beautiful facility overlooking the Ohio River.  (While the crest had passed downstream, the Ohio River was still very high!)

For those who attended the evening reception, the Keynote address by Mike Marshall, Alternate Federal Co-Chair, Delta Regional Authority,  stressed his belief that the Panama Canal will be a game changer for the economies of the Delta Region, providing new opportunities and markets in the region.

What did I learn?

  • The region is interested developing into a regional crossroads, with a focus on the nexus of the rivers and rail networks from Paducah to Lexington.
  • While aviation is anchored in the State through the airports in Louisville and Cincinnati (actually in Hebron,KY) flows through the rest of  the state still provide critical services.
  • Kentucky is very dependent upon manufacturing, which ranked as the largest employer in the State.  It was echoed that transportation networks were critical to supporting the shipments from the State.
  • Secretary Hancock, Kentucky Transportation Cabinet, outlined the challenges poised by the flooding of the Ohio River and its tributaries on the State of Kentucky.
  • Kentucky is very interested in developing multimodal solutions to its transportation system, although trucking remains the dominate mode of transportation in the State, but new regulatory pressures could change the trucking climate (costs).
  • Mrs. Lauren Brand, Marad, did a great job on her presentation.  She challenged the audience to think about how to develop market studies that would utilize the region’s assets to promote future growth.
  • Secretary Hancock discussed how increased trade with the Canal will probably pass over I-65, and the plan is to finish widening it across the Commonwealth.  This also includes finishing the I-69 Corridor.  The Cabinet is also doing other scoping studies, but the Commonwealth also has to look at adding value to the transportation networks that use or pass through the region.
  • The Paducah Area Chamber of Commerce is planning a trip to the Panama next April as a followup for this meeting.

What did I do?

  • I participated in a panel with Mr. Rodolfo Sabonge, Vice President of Market Research and Analysis, Panama Canal Authority, and Mr. Dale Lewis, Director of Strategic Analysis, CSX Transportation.
  • Mr. Sabonge spoke first, providing a very through overview of the Canal.  One thing I learned was the PCA does a monthly video update on the expansion.  There is a great multimdia page on the Panama Canal site with live cameras, videos and other information.  (There is also a good video about the Canal developed by PBS.)
  • Mr. Lewis did a great presentation regarding models regarding the indifference line between the various ship configurations and transportation costs.  In both presentations, Kentucky was right in the indifference line between different configurations, but both of the discussions focused on the costs to the region from Eastern ports – not Gulf coast ports.
  • My presentation is posted here.  I focused more on the role of exports in Kentucky (and the broader region) and the importance of looking at developing state partnerships to support infrastructure and economic growth.

What does it mean for the ITTS Region?

  • I think Greg Pritchett, Chair, KY Water Transportation Advisory Board and Chair, KY Association of Riverports, got it right:  the coastal ports are competing with each other, but it is up to Kentucky businesses to utilize its own multimodal networks to provide the necessary services to support Kentucky businesses.

Lambert’s Langiappe – Novels and Transportation Policy (april/may 2011)

May 13th, 2011

What does it take to tell a story? Throughout history, we have celebrated the ability of the written word to inspire or simply entertain us. Brett Battles, my wife’s cousin, just published his fourth book, “The Silenced”. Driving back from the bookstore, I reflected about the discipline it takes Brett to write his novels. While I don’t write thrillers, at the same time, I find myself constantly telling the story of infrastructure – why does it matter and what opportunities does it provide.

Recently, I was discussing how different the freight transportation story becomes based upon the audience. For example, when I talk to DOT and MPO planners, they tend to discuss freight in the context of projects and localized networks. They understand that freight is important; there will be more trucks in the future and multimodal transportation networks should be examined.  However, freight shipments, while recognized as critical, are seen as simply another user community, which must be balanced against bicycles, transit, or other passenger movements.
When I make the same discussion with various businesses, they focus on the regulations or operational needs of the transportation system, although some will discuss the longer term structural aspects of infrastructure improvements. Most believe that there is an implicit commitment that infrastructure will be maintained and developed at the regional level.  When I meet with legislators, they will discuss funding, but also the need for specific projects in their region. The wider network effects and discussions on transportation connectivity seem buried against the broader budgeting activities.
Given the very diverse nature of freight transportation, there are many different people involved in the discussion. Meetings such as the upcoming Georgia Logistics Summit or AAPA’s seminar on Communicating the Importance of Infrastructure Investment are critical in highlighting the importance of this dialogue.  But when there is a story, there is always a cost:  what did the hero give up to reach his goal? No one watches James Bond beat up a local bully in a school yard. As with transportation, we get the same discussion – what is the cost of the story? Generally, the funding issue seems to be the biggest barrier to some resolution, not only regarding the reauthorization of the various transportation bill but also at the state and local level.
Unlike Brett’s novel, we can’t seem to agree on what the story line is regarding transportation’s linkage to economic growth, jobs, and finally funding in a nice, coherent manner.  But the dialogue is critical if we hope to find ways to enhance America’s competitiveness in global markets.