Stimulating discussions

Stimulating discussions

Cincinnati-Northern Kentucky International Airport contains a series of spectacular ceramic, art deco murals depicting the history and commerce of the city. The murals were originally commissioned by the Works Progress Administration for the Cincinnati Union Terminal and relocated to the airport when the train station was demolished in the 1970s.

The WPA was a New Deal Agency created by President Franklin Roosevelt to help provide economic relief to U.S. citizens suffering through the Great Depression. Between 1935 and 1941, the WPA spent approximately $11.5 billion. This money was spent in a number of ways: highway, road and street projects; public buildings; public utilities; and social welfare projects.

The WPA resonates today as President-elect Obama considers a stimulus plan for the moribund U.S. economy. The numbers mentioned are large, but the intent seems to be for the total not to exceed $1 trillion. By way of comparison, using the relative share of GDP as a benchmark, the WPA expenditure today would come to more than $2 trillion.

The stimulus plans being discussed today resemble WPA-era programs. There are apparently six main parts: health-care financing; energy-saving programs; public works projects; school construction and renovation; expanded jobless aid and food stamps; and targeted tax cuts.

Many of these initiatives have been Obama campaign positions for more than a year.

On his Dec. 6 radio address, the president-elect linked rebuilding our nation's infrastructure to 2.5 million jobs that would be added or saved. He has frequently spoken of overseeing the nation's largest infrastructure undertaking since the interstate highway system was created in 1956.

The new administration will have its hands full. Surface transportation reauthorization, SAFETEA-LU, expires on Sept. 30, and its "legacy for users" is profound. The $286.4 billion it guaranteed was universally regarded as insufficient. Industry leaders already are talking about the next bill requiring at least twice as much. The National Surface Transportation Policy and Revenue Study Commission (mandated by SAFETEA-LU) reported in 2008 that "the future of our nation's well-being, vitality and global economic leadership is at stake. We must take significant, decisive action now to create and sustain the pre-eminent surface transportation system in the world."

Transportation Secretary Mary Peters dissented from the report because she disagreed on the need to raise fuel taxes. Her disclaimer was made as the Highway Trust Fund needed an emergency transfusion of $8 billion from the general treasury to avoid being insolvent last October. Peters also believed that the private sector could invest in infrastructure, but that was before the private-sector financial community imploded.

It is hoped that Rep. Ray LaHood, R-Ill., Obama's nominee for transportation secretary, does better than the last bipartisan appointment. Norman Mineta was a major disappointment to an industry that initially had high expectations for him. Not only did he refuse to speak truth to power about the funding realities, he actually took several steps back. Perhaps nothing symbolizes his time in service more than the destruction of the Office of Intermodalism. That office was established in ISTEA -- which then-Rep. Mineta had an integral role in creating. It was effectively abolished in the 2004 Norman Y. Mineta Research and Special Programs Improvement Act.

This is especially unfortunate because so many of the challenges we face today are intermodal in nature. Rep. James Oberstar, D-Minn., chairman of the House Transportation and Infrastructure Committee, recently remarked, "Intermodalism has not happened at the DOT in a long time, and we need to start it and sustain it in order for this agency to work well."

The challenges for our industry are daunting. Freight is an asset-based, network-operating business that moves within corridors that are national, continental and international in nature. Relying on state and local initiatives -- usually successful for passenger and transit -- is insufficient for freight.

The policy implications of these problems are enormous. Just as intermodal represents the confluence of multiple modal silos (truck, rail and water, for example), transportation sits at a nexus of policy silos (trade, energy, environment and homeland security) that are complex in their own right.

Hopefully, the new administration will take office in an environment conducive to infrastructure investment and policy achievement. Our industry knows what is necessary; it is up to us to take the appropriate steps.

Ted Prince is Principal, T. Prince & Associates LLC. He can be contacted at ted.prince@atlarge.net.