May 4, 2008

Florida Trial Lawyers Kick John Henry's Patoot

The Orlando Sentinel offers a post-mortem of the Central Florida commuter train debacle in the Legislature. The state and CSX negotiated a $650 million package of rail improvements, while granting the company liability protection for operations on the proposed line from Volusia to Osceola counties.

Florida's trial-lawyer association is traditionally opposed to any limits on people's right to sue. It is a potent interest group in Tallahassee; its political committee contributed more than $3.5 million to state candidates in the past three years. And it has particularly strong support in the Senate.

But though the trial lawyers had said early this year they had a "problem" with the liability language, Central Florida backers didn't recognize until too late how hard the group was willing to fight.

"No one realized that the trial lawyers had decided to take this on and make it their power play," said Fred Leonhardt, a lobbyist for Orlando.

Posted by Carter Wood at 12:01 PM | Click here to comment | Send to a Friend

April 18, 2008

Sounds Like a Winning Campaign Platform to Us

From Reuters, reporting on Silvio Berlucsconi's election to a third term last weekend as prime minister of Italy:

On Tuesday, he repeated campaign promises to cut taxes and sell state-owned real estate to trim a crushing public debt burden.

He has also pledged more infrastructure spending to stimulate the economy...

Time again to turn to the Tax Foundation for the global context: "Currently, the average combined federal and state corporate tax rate in the U.S. is 39.3 percent, second among OECD countries to Japan's combined rate of 39.5 percent."

Posted by Carter Wood at 3:28 PM | Click here to comment | Send to a Friend

April 15, 2008

Attack on Property Rights Restoration Act

Rule of Washington, D.C., thumb: If legislation carries the term "restoration" in its title, it will inevitably do far more than restore past law. It will rewrite existing statutes to weaken the private sector and expand government. The Fair Pay Restoration Act doesn't restore "fair pay," but rather makes it possible to sue and sue and sue employers, ad infinitum.

And the Clean Water Restoration Act federalizes control over most occasionally damp pieces of land in the United States.

On Wednesday, the House Transportation and Infrastructure Committee will hold a hearing on the water legislation, which needs much attention beyond the agricultural and property rights groups who are particularily exercised about the federal power grab. (Hearing details here and additional background here.)

Supporters sell the legislation as an effort to clarify the Clean Water Act's authority following several Supreme Court decisions, but in reality, it's a vast extension of the regulatory state over wet areas. For manufacturers, the concern is that modest remodeling or expansion projects that might once had been worked out with local planners or environmental authorities would fall under additional federal regulatory oversight, with all the attendant costs and delays.

And each regulatory decision becomes another point that NIMBY or environmental groups can use in litigation to block a project. That's an especially important issue for future infrastructure or energy projects that meet the economy's needs -- and create jobs.

The National Center for Policy Analysis National Center for Public Policy Research has been working diligently on this issue, and today the group issued a news release and study warning sportsmen of the threat: "[The legislation] would do more to threaten the cherished pastimes of hunters, fishermen and other outdoor enthusiasts than it would to ensure the cleanliness of our nation's water." Earlier in the month the the group released a letter signed by 53 separate groups -- the NAM included -- that highlighted the bill's failings.

The Senate has aleady held a hearing this month and tomorrow a House committee considers the bill, so it's wise to be paying attention -- this legislation may be moving.

Correction: We confused our National Centers. Apologies to both.

Posted by Carter Wood at 9:11 AM | 1 comment; click here to read it or submit your own! | Send to a Friend

March 27, 2008

Infrastructure as Economic Stimulus

Could this be a national campaign theme being tested on the regional circuit? Washington Gov. Christine Gregoire, in an economic address Wednesday:

“We need a stimulus package that generates pay checks, not a single check,” Gregoire said. “We need a stimulus package that rebuilds our creaking infrastructure and makes our economy stronger.”

The governor is asking the White House and Congress to invest in jobs that pay family wages and improve our communities at the same time by financing “ready-to-go-projects” throughout the state and country.

In Washington alone there are 156 water and sewer projects worth more than $350 million, and 29 statewide transportation projects that would cost $75 million. All of these projects have gone through the design and environmental review process and could begin construction within weeks.

Deja vu. Public works spending -- $6 billion worth -- was a major component of President Bill Clinton's first economic stimulus bill in 1993. The legislation was blocked by a Senate Republican filibuster and got the Clinton Administration off to a rocky start.

Posted by Carter Wood at 9:26 AM | Click here to comment | Send to a Friend

March 26, 2008

Honor U.S. Commitment on Cross-Border Trucking

The NAM is a co-signer with many, many companies and business and agriculture groups to a letter urging Congress to live up to the U.S. commitment to enact a cross-border trucking pilot program with Mexico. It's a good letter.

Prior to implementation of the pilot program, the United States restricted Mexican trucks entering the United States. In 2001, a NAFTA dispute-settlement panel unanimously ruled that the blanket exclusion of Mexican trucking firms violated U.S. obligations under the NAFTA. The ruling gave Mexico the right to retaliate against U.S. products entering Mexico. It is estimated Mexican retaliation against U.S. products could be as much as $2 billion per year. Fortunately, Mexico refrained from retaliation. However, if the pilot trucking program is blocked, we expect Mexico to exercise its right to retaliate. Retaliation of this magnitude could wipe out a broad swath of U.S. exports to Mexico and related U.S. jobs.

Although agricultural interests would be most prominently affected, the harm from Mexican retaliation could also be significant.

Mexico is an important export market for many U.S. businesses and manufacturers. For example, Mexico is one of the largest export markets for consumer electronics (CE) products produced in the United States. The CE industry is poised to be negatively affected by any retaliation. Additionally, Mexico is by far the largest market for U.S.-made yarn and fabric (textiles). Almost $3 billion worth of U.S. textiles were exported to Mexico in 2007. Textile exports could be jeopardized by the Mexican retaliation as well as by lack of cross border trucking.

And shouldn't the United States live up to its agreements?

Posted by Carter Wood at 5:59 PM | 1 comment; click here to read it or submit your own! | Send to a Friend

March 18, 2008

The Things You Learn from Speeches

From the President's speech at the Port of Jacksonsville:

According to the most recent data, you move more than 8 million tons of cargo each year. This cargo doesn't move itself. Somebody has to move it from port to port.

I'm sitting -- standing in front of people that are all part of the process, good, hard-working Americans. They're putting food on the table for their families because of trade.

You handle more than -- more automobiles than any American port.

I don't know if the people of Jacksonville understand that. Think about that, more automobiles are handled at this port than anywhere in the United States of America.

Wow. In fact, the Port of Jacksonville handles more than 18 million tons of cargo each year, including more than 600,000 automobiles and 760,000 containers.

Which ties into the growth of automobile manufacturing in the southeastern states.

Posted by Carter Wood at 4:09 PM | Click here to comment | Send to a Friend

March 10, 2008

Keep on Trucking

From this morning's news conference at the U.S Department of Transportation:

U.S. Transportation Secretary Mary E. Peters today cautioned Congress that now is not the time to halt efforts to implement trucking provisions in the North American Free Trade Agreement (NAFTA), which is delivering economic benefits to U.S. workers, farmers, businesses and consumers.

Secretary Peters said a broad coalition of more than 69 U.S. companies and agricultural and business organizations support the project because of the benefits it provides to U.S. exporters who every year ship billions worth of products and produce into Mexico. Should Congress choose to end the project, Mexico has the right under the rules of NAFTA to impose fees and tariffs on U.S. goods that would surely result in lost business and lost jobs, she said.

“Whatever their reason, this is no time to let the politics of pessimism dim the promise of prosperity for hundreds of thousands of American drivers, growers and manufacturers. We should be looking for every chance to open new markets for our drivers, to find new buyers for our products, and encourage new consumers for our produce,” Secretary Peters said.

This study by Iowa State University economics and finance professor Dermot Hayes documents the economic impact and jobs loss from legitimate Mexican retaliation.

The Trucker.com has a story on the issue, "Peters makes plea for keeping Mexico truck program," noting the participation of: National Association of Manufacturers President John Engler; American Farm Bureau Federation President Bob Stallman; Corn Refiners Association President Audrae Erickson; and Emergency Committee for American Trade President Calman Cohen.

The Senate Commerce Committee holds a hearing on the Mexican cross-border trucking program on Tuesday at 2:30 p.m. Details here.

UPDATE (2:50 p.m.): AP story here.

UPDATE (3 p.m.): A little back story. The Teamsters have gone after Peters for her efforts to implement the law, a typical enough tactic by organized labor: When you can't make the case on a policy basis, personalize it.

Posted by Carter Wood at 12:45 PM | Click here to comment | Send to a Friend

March 4, 2008

Good Ideas for Manufacturing (Sorta)

The EPI’s Susan Helper writes in today’s Washington Post:

One-tenth of all U.S. jobs are in the manufacturing sector -- good jobs that pay 20 percent more than the national average. Manufacturing accounts for 12 percent of gross domestic product and over half of our national spending on research and development.

Because even the most modern economies cannot thrive without making things.

Good ideas that will help presidential candidates win in Ohio today can also help America win in the global economy. Let's remember that, long after the votes are counted.

What kind of good ideas? Helper recommends that we “start with more investment in education, training, and research and development.” In that, the NAM agrees, but it's not enough. Addressing the skills gap, improving our national infrastructure and promoting R&D are a start, but we also need to address the serious challenges faced by manufacturers in the United States -- things like soaring energy costs, the high costs of civil litigation, and a corporate tax structure that discourages investment.

Today’s manufacturers need pro-growth policies put in place to help them compete in this global market place. Candidates who advocate one set of policies, however credible, without addressing the costs of doing business aren't doing anyone a favor.

Posted by Keith Smith at 5:21 PM | Click here to comment | Send to a Friend

February 26, 2008

Mitch Daniels on Infrastructure at AEI

The most promising and politically controversial initiative taken by Indiana Gov. Mitch Daniels during his first term of office was the long-term leasing of the Indiana Toll Road to a private consortium, bringing in nearly $4 billion over 75 years. (Details here.)"We are taking in more in interest alone each year than the toll road generated in 50," Daniels told an audience at the American Enterprise Institute Monday. The revenues are dedicated to infrastructure and economic development, he emphasized.

These kind of private-public partnerships are drawing more attention nationwide as gas tax revenues prove insufficient to maintain transportation infrastructure. Democratic Governor Ed Rendell of Pennsylvania -- incoming chairman of the National Governors Association -- supports a long-term lease of the Pennsylvania Turnpike, with revenues to address the state's infrastructure shortfalls.

But the talk of public-private partnerships is not -- and should not be -- limited to public toll roads. Private management of the Gary, Ind., airport, for example, is a "tantalizing subject" Daniels told the AEI audience.

"The mayor of Gary has said that he is prepared to look at the possibility of some kind of a lease of that facility that might bring some private capital into the game, too,” Daniels said...[snip]

“There’s a heck of an opportunity there if we can get it right,” he said of the airport. “I would use both public and private tools. I support that.”

Daniels took great political heat from the toll-road leasing (unions and local residents being most upset), but the benefits are accruing and the political damage clearly subsiding. A just-released public opinion poll showed Daniels with a 20-point lead over both his potential Democratic challengers.

P.S. Governors talked about infrastructure in their meeting with President Bush Monday. A recurring theme at these NGA meetings is the states' pleas for more federal dollars.

Posted by Carter Wood at 9:10 AM | Click here to comment | Send to a Friend

February 20, 2008

Infrastructure: An Investment Priority

National Association of Manufacturers' President John Engler participated in a panel discussion yesterday at Iona College on infrastructure and emergency response, part of a daylong conference organized by Terex Corp. From The Connecticut Post:

NEW ROCHELLE, N.Y. — When the bridge in Minneapolis collapsed in August 2007 and killed 13 people, Ronald DeFeo called the president of Iona College to tell him he was worried about the nation's infrastructure.

Tuesday, DeFeo, chief executive officer of construction equipment maker Terex Corp. in Westport, Conn., joined Iona's president, Brother James Liguori, in opening a conference that featured present and former congressmen, national leaders in security and transportation operations and President Eisenhower's granddaughter in discussing how to fix the nation's ailing infrastructure.

As this sidebar notes, DeFeo is an alumnus of Iona College.

"We do have a great country and we want it to stay a great country," said DeFeo, whose company builds construction equipment. "It needs vision. It needs planning. It needs leadership."

Terex's news release is here.

Posted by Carter Wood at 9:15 AM | Click here to comment | Send to a Friend

February 19, 2008

Infrastructure: As Competitors Upgrade

The Economist examines China's infrastructure splurge, "Rushing on by road, rail and air." The monster projects -- like Beijing's new 1.8 mile long airport terminal -- are the attention grabbers, but it's in the daily upgrades and expansions the larger economic impact may be felt. Consider railways.

In the past couple of years investment has grown considerably. This year's target is $42 billion, compared with a total of $72 billion in the preceding five years. World Bank officials call it the biggest expansion of railway capacity undertaken by any country since the 19th century. China had 78,000km of track at the end of last year. The original plan, published in 2004, was to increase this to 100,000km by 2020. Last October this was revised to 120,000km (and officials now say the target will be met by 2015). Even sticking to the 2020 target, this will mean laying 60% more track in the next dozen years than was built since the start of the economic reform programme 30 years ago. Huang Min, the Ministry of Railways' chief economist, says that by 2020 the railway system's freight-handling capacity should be greater than demand. At present, he says, it can handle only 40%.

Mr Huang reckons that railway expansion will bring down logistics costs, which he says amount to 18% of GDP in China compared with 10% in America. It will also help reduce pollution, he says, since fewer polluting lorries will be needed.

A nicely done review of the big infrastructures issues affecting China, and by extension, the rest of the world.

Today, by the way, NAM President John Engler is participating in a daylong conference, "Infrastructure: A Pathway to Prosperity," sponsored by Terex Corp. at Iona College in New Rochelle, N.Y.

Posted by Carter Wood at 6:54 AM | Click here to comment | Send to a Friend

February 14, 2008

Public-Private Partnership, Paving the Way

The "nation's status quo highway program is no longer acceptable, and needs to be reformed, refocused, restructured, and refinanced." -- Pete Ruane, president and CEO of the American Road and Transportation Builders Association (ARTBA), speaking at ARTBA's 19th Annual Conference on Public-Private Ventures in Transportation.

From Michigan Contractor and Builder.

Posted by Carter Wood at 7:04 AM | Click here to comment | Send to a Friend

January 15, 2008

Infrastructure Report: Setting a Framework

Transportation for Tomorrow: Report of the National Surface Transportation Policy and Revenue Study Commission was released this morning at a news conference held at the National Press Club. You can download the report at the commission's website, www.transportationfortomorrow.org/finalreport.

The National Association of Manufacturers issued a news release in response, "Report Highlights Need to Increase Investment in Nation's Infrastructure." NAM President John Engler called the report an “excellent platform to begin discussing how to improve the U.S. transportation system.”

“Modernizing our nation’s infrastructure system is a top priority of manufacturers,” Engler said. “We depend on the ability to move goods throughout the country efficiently yet face transportation bottlenecks that cost industry nearly $8 billion a year.

“The commission reached a consensus on the clear need to increase investment in our nation’s transportation system to lessen these bottlenecks,” he said. “While there are bound to be differences among commissioners over the level or source of funding, these differences do not diminish the compelling case for additional investment.”

Reuters story.

Posted by Carter Wood at 1:56 PM | Click here to comment | Send to a Friend

Transportation Infrastructure Revenue

Several news stories anticipate this morning's release of a report from the National Surface Transportation and Revenue Study Commission.

Associated Press:

WASHINGTON (AP) — A special commission is urging the government to raise federal gasoline taxes by as much as 40 cents per gallon over five years as part of a sweeping overhaul designed to ease traffic congestion and repair the nation's decaying bridges and roads.

The two-year study being released Tuesday by the National Surface Transportation Policy and Revenue Study Commission, the first to recommend broad changes after the devastating bridge collapse in Minneapolis last August, warns that urgent action is needed to avoid future disasters.

Under the recommendation, the current tax of 18.4 cents per gallon for unleaded gasoline would be increased annually for five years — by anywhere from 5 cents to 8 cents each year — and then indexed to inflation afterward to help fix the infrastructure, expand public transit and highways as well as broaden railway and rural access, according to persons with direct knowledge of the report, who spoke to The Associated Press on condition of anonymity because the report is not yet public.

And The Hill:

Business groups are looking at Tuesday’s release of a transportation study as a start-your-engines moment to what is likely to be one of the most aggressively lobbied highway bills in recent memory...[snip]

“Nothing like this has been done before,” said Rosario Palmieri, vice president for infrastructure policy at the National Association of Manufacturers.

The report is due out at 11 a.m., and the commission's website -- information-rich and good site, by the way -- is www.transportationfortomorrow.org. We'll have more during the day, once we can shed our cloak of anonymity because the report is not yet public.

Posted by Carter Wood at 8:53 AM | Click here to comment | Send to a Friend

December 27, 2007

Schwarzenegger: How Many Steps Back?

Our question is:

How can Governor Schwarzenegger reconcile his push for more infrastructure spending with his war against carbon dioxide?

Posted by Carter Wood at 11:35 AM | Click here to comment | Send to a Friend

Schwarzenegger: Two Steps Forward

More on California and infrastructure:

Gov. Arnold Schwarzenegger on Wednesday released plans to boost enrollment in engineering programs at state universities.

The plan appeared aimed at appeasing the state engineers' union and Democrats, who have balked at outsourcing government jobs to design roads, schools, levees and other projects.

Way to jump right into that "news analysis," AP. Gratuitous opinionzing, even if it appears to be accurate opinionizing.

The news release -- blog comment, rather -- on the engineering initiative is here; it's from Victoria Bradshaw, secretary of the California Labor and Workforce Development Agency. The governor's news release states these goals:

Establish programs at the University of California (UC) and California State University (CSU) to expedite certification for veterans with engineering backgrounds. This will open up important employment opportunities to the approximately 3,000 service members discharged to California each year who hold engineering-related military jobs.

Direct $1 million in federal Workforce Investment Act funds to develop new apprenticeship programs that partner private industry and California Community Colleges (CCC).

Launch the Engineering Education Council to bring more private funds into "pipeline" programs at UC, CSU, CCC and other engineering programs. These programs help move math and science students into the engineering field.

Expand the statewide charter of High Tech High, a California charter school organization, to build out engineering-focused charter schools. In 2006, the State Board of Education approved 10 High Tech High charter schools; the Governor proposes to raise this number and expand its charter to grades K-12.

A little too much on the micro-initiative side? Makes the proposals appear like they're aimed at appeasing the state engineers' union and Democrats, who have balked at outsourcing government jobs to design roads, schools, levees and other projects

In any case, more kudos to Governor Schwarzenegger, who has a good appreciation of the economy's need for skilled, trained workers in the technical fields.

Posted by Carter Wood at 11:33 AM | Click here to comment | Send to a Friend

Schwarzenegger -- One Step Forward

From Reuters:

SAN FRANCISCO (Reuters) - California Gov. Arnold Schwarzenegger called on lawmakers on Wednesday to pass legislation to allow the private sector to have a bigger role in building, operating and maintaining the state's public works.

The Republican governor, who has often spoken in favor of public-private partnerships to improve and expand state infrastructure, urged the state's Democrat-led legislature to approve bills that would expand the types of projects, services and government entities that could enter into such tie-ups.

Schwarzenegger and top lawmakers rallied voters last year to support ballot measures authorizing more than $40 billion in general obligation debt to finance various public works projects. But he has maintained those funds represent a fraction of the investment the country's most populous state must make in its infrastructure.

The term of art for these projects is public-private partnerships or Performance-Based Infrastructure (wonder who focus grouped that one). As Schwarzenegger's news release states, he's asking the Legislature to statutorily:

Expand the types of projects, services and government entities that can enter into PBI arrangements.

Increase contracting flexibility so the state can better negotiate with potential contractors.

Establish "PBI California," a center for excellence to help determine which projects can benefit from PBI, represent the state in negotiations with PBI participants, ensure transparency and monitor performance.

Given the vast needs for infrastructure maintenance and expansion in California, Schwarzenegger is showing some real leadership (and appreciation for private-sector efficiencies) in offering new and not immediately universally popular financing proposals. Or so it seems at first glance...

The NAM's policy statement on transportation issues is here.

Posted by Carter Wood at 11:07 AM | Click here to comment | Send to a Friend

December 6, 2007

NAM to Congress: We Need Regulatory Relief

American companies are snowed under by federal regulations.

Just ask Dyke Messinger, president and chief executive officer at Power Curbers Inc. in Salisbury, N.C.

Messinger, who testified for the National Association of Manufacturers Thursday before the House Small Business Committee, told lawmakers he had to hire an employee just to fill out all the paperwork from EPA, OSHA and other government agencies.

“He’s expensive,” said Messinger, whose company makes equipment that turns concrete into curbs and gutters. “He basically handles all that for us.”

After the hearing Committee Chairwoman Nydia Velazquez (D-NY) told Messinger that lawmakers need to hear more from real companies about how federal regulatory requirements affect them.

Messinger's company has 104 workers in Salisbury, Cedar Falls, Iowa, and White House, Tenn. His regulatory requirements can exceed $10,000 per employee.

If you want to read Messinger's testimony in full, click here.

The House Small Business Committee is mulling draft legislation to improve the Regulatory Flexibility Act, which was first enacted in 1980 to ease the burden of federal rules on businesses, especially smaller ones.

The NAM supports a new-and-improved law. For instance, Messinger told Velazquez, ranking member Rep. Steve Chabot (R-OH), and other lawmakers the NAM wants to improve a periodic review of regulations impacting small businesses. And the NAM says the indirect cost of regulations on businesses should be weighed before they are put into effect.

American companies shell out $1.1 trillion a year to comply with federal regulations. The NAM's "Escalating Cost Crisis" report released in 2006 said American manufacturers are already saddled with a 31.7 percent cost advantage compared to our nine largest trading partners.

Posted by Greg Wright at 2:02 PM | Click here to comment | Send to a Friend

November 23, 2007

Countering Housing Decline with Increased Exports

Big media week for Dyke Messinger, president and CEO of Power Curbers, a manufacturer of construction machinery in North Carolina. First, he leads a New York Times story on rising exports for U.S. companies (reprinted here in Alabama's Times-Daily).

Then, on Wednesday, an excellent interview by NPR's John Ydstie on how the negative effects of the housing slowdown has been offset by increased exports. Dyke reports his foreign sales are up 130 percent.

I’d like to think that our machines are becoming more and more accepted and they’re choosing ours over the competition. But let’s say it’s really more market-driven. The world’s coming closer together. There’s more infrastructure development. Countries are becoming more open, economies are more privatized, so the need to move people and goods and services is much more important. But also the dollar has been falling against most all currencies, but especially the Euro.

Previous post on the Times story.

Posted by Carter Wood at 8:13 AM | Click here to comment | Send to a Friend

November 21, 2007

Braving the Rails, the Roads, the Airways

NAM Internet manager Greg Snapper e-mails a report from his travels to Michigan:

I don't know about you, but my holiday travel has come and gone without a hitch! No delays on metro, getting through security and my flight is about to take off - on time!

I've had enough of the holiday travel propaganda. All it is is a ratings maker...

And our trip from Union Station via Amtrak this afternoon was remarkably painless. With the extra cars added, the train wasn't even completely full all the way, and it arrived just 15 minutes late in Newport News. On the busiest travel day of the year.

An auspicious start to the holiday season.

Posted by Carter Wood at 9:35 PM | Click here to comment | Send to a Friend

November 16, 2007

Vodcast: Rep. Don Young on Mining

This week's video podcast of "America's Business with Mike Hambrick" goes to a House veteran and expert on two priority issues facing the U.S. economy, raw materials (mining) and infrastructure. Rep. Don Young (R-AK) is ranking member on the House Natural Resources Committee, deeply involved in both issues.

On infrastructure, he sees the danger of continued inaction until some disaster strikes. Young also passes harsh judgment on H.R. 2262, the Hard Rock Mining and Reclamation Act, already passed by the House: "“It was the worst bill I’ve had before me in 35 years…This bill would actually make most mining companies disappear from the United States.”

NAM President John Engler offers closing commentary on a critical but often overlooked issue facing U.S. exporters -- the antiquated and ineffective system of export controls, doing a disservice both to our national security and U.S. economic vitality.

The vodcast is downloadable in .m4v format and available as streaming video. To watch the vodcast online visit www.americasbusiness.org or on the NAM’s YouTube channel at www.youtube.com/namvideo.

Posted by Carter Wood at 8:41 AM | Click here to comment | Send to a Friend

November 13, 2007

Report from China: Yangshan Deepwater Port

[A dispatch from over the weekend.]

The ACTPN delegation headed toward what, in 2003, was a virtually unknown island of 3,5000 residents in the East China Sea. Today this island is the home of the Yangshan deepwater port, the third largest port in the world. The Chinese took just four years to construct a massive port off the mainland and develop a 30.5 km (19 miles) bridge and connecting the two. (Here's a photo of the bridge.)

To provide perspective on Yangshan’s size, let’s look at its progress: In 2003 it was a small island of 3,500 residents. The population was relocated and in their place is a port that will move 7.5 million containers (TCUs) this year.

The volume dwarfs America’s largest port, the Port of Long Beach, which moves 1.5 million TCUs/year and illustrates how China’s preparation for moving goods as global trade expands. Yet they’re only just beginning: By 2020, when its fourth and final phase is complete, Yangshan will move 15 million TCU/year, making it the world’s largest port. Where will America’s infrastructure be in 13 years?

More photos: 1. A view of the port. 2. Ship loading.

Posted by JP Fielder at 10:40 AM | Click here to comment | Send to a Friend

November 10, 2007

Cool Stuff Being Made: GE Locomotives

Cool Stuff Being Made travels the rails this week, or at least aspires to, as we head to Erie, Pennsylvania, and GE Transportation's locomotive manufacturing plant. As GE's website explains,

Right now, around the world, locomotives designed and built by GE are on the move, transporting products and people. At any one time, thousands of our locomotives are operating in more than 60 countries, from Australia to Zaire.

We built our first diesel-electric locomotives more than 80 years ago, In the years since, our locomotives have grown steadily in power and performance. We build new, remanufacture and modernize locomotives for purchase and lease, introducing unprecedented levels of customer productivity in both mainline and shortline service.

The Erie facility moves three locomotives through a day.

For all the central, historic role locomotives have played in American culture, it's odd that their manufacturing and assembly are not more widely depicted. It's heavy work, as we see in this 50-minute tour of the plant. And important to our entire economy. You have to think Thomas Edison would be proud.

Thanks, as always, to our friends at the Pennsylvania Cable Network for letting us spread manufacturing's story.

To view this week's Cool Stuff Being Made video .

Posted by Carter Wood at 8:04 AM | Click here to comment | Send to a Friend

November 9, 2007

Vodcast: Jim Talent on Infrastructure

We build this week's video podcast highlights of "America's Business with Mike Hambrick" on a foundation of infrastructure -- an interview with former Senator James Talent of Missouri.

During his years in Congress, Talent was a champion of creative financing approach to invest in U.S. roads, rails, ports and airports. Today, he serves as honorary chairman of the NAM-led Alliance for Improving America's Infrastructure.

In his interview with host Mike Hambrick, Talent says:

The crumbling infrastructure IS a liability, it’s a cost. The only question is, do we fix it? It’s like a homeowner who has a big hole in his roof and debates over whether he ought to fix it. No, you have to fix it, because it’s just going to get worse and eventually the house is going to collapse, so this is something we have to do.

Now, the good news is it’s fully within our capabilities as a nation. There are innovative financing tools that are available to allow us to do it efficiently, if we’ll just pull together and decide we’re going to do it instead of hiding our heads in the sand.

The podcast also features NAM President John Engler's commentary, saying current Congressional energy proposals pay shortshrift to domestic energy supplies and the U.S. economy.

To watch this week's vodcast, click on the embedded video or go the NAM's video page, http://www.youtube.com/namvideo

Posted by Carter Wood at 12:09 PM | Click here to comment | Send to a Friend

Logistically Speaking, U.S. Ranks 14th

The new annual survey from the World Bank of how countries rank in their trade logistics performance is just out, and the U.S. stands a fair to middling 14th. China ranks 30th. The survey rates countries according to:

1. Customs
2. Infrastructure
3. International Shipments
4. Logistics Competence
5. Tracking and Tracing
6. Domestic Logistics Costs
7. Timeliness

The top five are 1. Singapore, 2. Netherlands, 3. Germany, 4. Sweden, 5. Austria

Given all the (negative) attention paid recently to infrastructure, we would have thought the U.S. would have ranked poorly in that area, but the World Bank survey gave the U.S. seventh place in that category. (You can access a sortable table of the results here.) It's in "domestic logistics costs" -- local transportation, warehousing, terminal handling -- where the United States did most poorly, ranking 144th.

We speculate as to reasons: Energy costs, taxes, benefit mandates, excessive regulations -- many of the same things that contribute to the 31.7 percent cost disadvantage faced by manufacturers in the United States compared to our major global competitors. (As reported in our study, the Escalating Cost Crisis.) And then there's geographic distance; more compact industrialized countries seem to do well.

We haven't delved deeply into the methodology, so hesitate to pronounce on the annual rankings with the usual rhetoric about warning signals, wake-up calls and words to the wise. Still, at first glance this looks like a pretty good summary: The United States has many logistical strengths that help us compete in the global economy, but there's plenty room for improvement.

Thanks to the 3PLWire Blog (Third Party Logistics) for posting on the report.

Posted by Carter Wood at 8:56 AM | Click here to comment | Send to a Friend

November 8, 2007

Report from China:

The ACTPN* delegation has just arrived in Shanghai, often called the New York City of China. With a population of 13.6 million (plus 4.2 million, long-term internal immigrants), you can understand the comparison.

On the drive in, it wasn't the density of the population of the neighborhoods off the highway that was most striking, but rather the number of container trucks racing along the road -- clear evidence of Shanghai's prominence as China's center for trade. With $64 billion in exports during the first half of this year, Shanghai ranks at or near the top of the list of busiest seaports in the world (Rotterdam and Singapore lay claim to having the busiest port, as well).

Tomorrow, we'll travel to the new Yangshan deepwater port to observe the activity and study the infrastructure.

* Advisory Committee for Trade Policy Negotiations

Posted by John Engler at 9:48 AM | Click here to comment | Send to a Friend

November 7, 2007

Report from China: Infrastructure and Growth

NAM President called back to D.C. from Chengdu yesterday. We recorded his comments and share some of them here. (Via cell phone, so the quality leaves something to be desired. And what is that tune?)

Adding to yesterday's post about infrastructure, he compared -- ruefully? -- the traffic congestion to Northern Virginia's.

China has an aggressive strategy toward infrastructure investment, Engler notes, necessary at the very least to keep even with economic growth.

To hear those comments via an .mp3 file, click here.

More generally, Engler observed:

[There is] a sincere desire to increase domestic consumption in China, to lift the standard of living for literally tens of millions of people who are slightly above subsistence level. There’s a rising middle class here, so there’s clearly changing economic conditions in the country. ...

[I]ncreasing domestic consumption should mean increased [U.S.] exports. We’ve seen U.S. exports to China rise; they’ve been relatively rapid in their rise compared to many other destinations, so that’s the good news. There clearly an ongoing issue about currency. While there has been an 11 percent appreciation over recent years, since the Chinese currency was unpegged from the dollar, still more progress needs to be made. And key Chinese official shave indicated that is the intent and it can’t be done overnight, but it can be done. And they expect that they will make headway.

With the caveat, a big one: " We don’t walk away with the idea that all the problems have been solved."

To listen to Engler's comments about the economy and trade, click here.

Posted by Carter Wood at 5:20 PM | Click here to comment | Send to a Friend

November 6, 2007

Report from China: Infrastructure and Chengdu

The critical importance of infrastructure as a foundation for U.S. competitiveness has really been brought home during our trip to China. As we leave Beijing for Sichuan Province, I am struck by the astronomical development of the city over the past decade. It has been nearly that long since I was last here, as Governor of Michigan, and not one buildings in which we had meetings this week existed back then.

Beyond that, I don't think any of the roads we took to reach the buildings existed, at least in their current state. According to one senior administration official, the roads and highways built in China over the past 10 years are equal to America's entire interstate highway system.

Speaking of developing, we're wheels-up to Chengdu, the teeming manufacturing city of nearly 11 million people. The city's high-tech industrial development zone is home to many manufacturers, including Alcatel, Intel, IBM, Microsoft, Motorola, NOKIA, and SAP, as well as China's Lenovo.

Posted by John Engler at 10:57 AM | Click here to comment | Send to a Friend

October 22, 2007

Radiohead: Well, It's Not Radar Love...

Jim Fusilli, the Wall Street Journal's rock 'n roll reviewer, waxed eloquent on Saturday (or whatever the digital version of "waxing" is) about Radiohead's new "In Rainbows" album, which is getting lots of attention for its marketing. You can download the album from the band's website -- www.inrainbows.com -- and pay whatever you deem it worth.

We were also struck by a quote from one of the songs' lyrics, "House of Cards":

The infrastructure will collapse
Voltage spikes
Throw your keys in the bowl
Kiss your husband goodnight

This is the first direct reference to the word "infrastructure" we recall in a rock 'n roll song. And is it using the 2003 East Coast blackout as a metaphor? Anyway, an expression of the Zeitgeist.

Meanwhile, for all you tax lawyers and theorists, consider the taxing model for a customer's download of music for which the customer determines the prices. Makes Quill Corp. v. North Dakota seem quaint.

Posted by Carter Wood at 9:19 AM | Click here to comment | Send to a Friend

September 21, 2007

Up To Date with John Engler in Kansas City

NAM President & CEO John Engler was in the studios of Kansas City public radio station KCUR this morning, talking manufacturing on "Up to Date," a daily public affairs show.

Steve Kraske of the Kansas City Star was the host, and he asked questions across a full range of manufacturing issues: the EPA's proposed new ozone regulations, vehicle CAFE standards, America's educational system and workforce development*, and America's manufacturing strengths and productivity even in the face of global competition. Really good interview, about 40 minutes worth, which you can listen to by clicking here. KCUR also offers downloads and podcasts.

*Kansas City was the pilot site for the Dream It! Do It! campaign, making a major commitment to the next generation of America's high-skilled employees.

Posted by Carter Wood at 3:03 PM | 1 comment; click here to read it or submit your own! | Send to a Friend

September 7, 2007

Infrastructure Bonds: The Road to Investment

Legislation to establish infrastructure investment bonds has met with resistance in the past. The political climate has changed, however, as more and more Americans understand viscerally how critical safe roads, rails and shipping facilities are to the economy and the public's safety.

From The Oregonian:

Sen. Ron Wyden hopes the third time is the charm.

After two failed efforts, the Oregon Democrat again is teaming with a Republican senator to push for a plan to issue billions of dollars in transportation bonds to help cash-strapped states fix roads, bridges and transit systems.

This time, Wyden is teaming with Sen. John Thune, R-S.D., and proposes using up to $50 billion in bonds to boost the nation's infrastructure.

Under the legislation, bonds would be spent on transportation projects around the country, including roads, bridges, railroads and waterways. Instead of interest, bond holders would receive tax credits.

The two senators said the money would be in addition to money states receive from the federal Highway Trust Fund, which pays for building and repairing roads and bridges through a national gas tax.

Senate Wyden's news release.

The AP story from South Dakota. (Update your website, Senator Thune!)

The NAM's news release in support of the legislation and the Build America Bonds.

NAM President John Engler attended the news conference yesterday. His statement:

How does the world’s largest and most successful economy have 75,621 structurally deficient bridges and another 79,523 that are functionally obsolete...This is first and foremost an issue of public safety, as was underscored by the recent tragedy in Minnesota. But it is also a critical economic issue. According to the American Society of Civil Engineers, Americans spend 3.5 billion hours a year stuck in traffic, costing $63.2 billion per year to the economy.

Last March, the NAM's Board of Directors determined that the U.S. infrastructure demanded action, and in August the NAM formed the Alliance to Improve America’s Infrastructure.

BTW, we'll have Bill Graves, president of the American Trucking Associations, on the NAM's radio program, "America's Business with Mike Hambrick," to discuss infrastructure issues.

UPDATE (12:35 p.m.): The AP story notes Sen. Norm Coleman's support and quotes Engler.

Posted by Carter Wood at 8:55 AM | Click here to comment | Send to a Friend

August 19, 2007

Infrastructure: Spending Dollars Correctly

Straight-forward editorial in the Wall Street Journal arguing that the problem with infrastructure is not how MUCH money is being spent, but rather HOW it's being spent. The focus is on Minnesota and its tax revenues, the choices facing Governor Pawlenty, and the record of Chairman James Oberstar.

Minnesota spends $1.6 billion a year on transportation--enough to build a new bridge over the Mississippi River every four months. But nearly $1 billion of that has been diverted from road and bridge repair to the state's light rail network that has a negligible impact on traffic congestion. Last year part of a sales tax revenue stream that is supposed to be dedicated for road and bridge construction was re-routed to mass transit. The Minnesota Department of Economic Development reports that only 2.8% of the state's commuters ride buses or rail to get to work, but these projects get up to 25% of the funding.

Americans aren't selfish or stingy, and they can see for themselves that many of our roads need repair. Minnesota in particular is a state that has long prided itself on its "progressive" politics and a willingness to pay higher taxes for good government. Minnesotans already pay twice as much in taxes per capita than residents in New Hampshire and Texas--states that haven't had a major bridge collapse.

We suspect most voters would indeed be willing to pay more for better roads and bridges, if they had any reason to believe that is where the money would be spent. But they have long experience with politicians promising them that new taxes will go to such projects only to see it diverted for parochial ends. A new Survey USA poll finds that 57% of Minnesotans oppose higher gas taxes. Mr. Pawlenty can follow their advice, or Mr. Oberstar's.

Article I, Section 8 of the U.S. Constitution speaks to this issue. That passage about light rail.

Posted by Carter Wood at 3:15 PM | Click here to comment | Send to a Friend

August 17, 2007

Speaking of Infrastructure

From Carrie L. Lukas, vice president for policy and economics at the Independent Women’s Forum, "Guess what else is structurally deficient."

WASHINGTON (Map, News) - People wonder how government could ignore problems like those that led to the Minneapolis bridge collapse, but the truth is that officials have long been turning a blind eye to many looming disasters besides the nation’s roughly 75,000 structurally deficient highway spans.

Consider our Social Security system. Each year, the nonpartisan Social Security Trustees details the program’s sorry financial prospects. The latest report concluded that the program — which consumes more than one-fifth of the total budget — will begin paying out more in benefits than it takes in as taxes in just 10 years.

At that time, Social Security will begin drawing down its “trust fund,” which means it will demand additional tax dollars from the general revenue to meet its obligations. By 2041, when the trust fund is exhausted, Congress will have to hike payroll taxes or starting slashing benefits for seniors.

Good point.

Difference between Social Security and infrastructure, though? There's no equivalent of a horrible, fatal bridge collapse to warn against Social Security's shaky footings. There are only more reports, studies and papers...

Posted by Carter Wood at 8:06 AM | Click here to comment | Send to a Friend

Infrastructure: Let's Consider All the Options

Solid commentary the other day from Morton Kondracke on the topic of infrastructure. Nothing earthshaking -- just a balanced, sensible, things-to-be-argued-over column about ways to achieve necessary infrastructure improvements in a partisan political world. Kondracke says Republicans should not rule out tax increases, and Democrats should be willing to accept private-public partnerships, things like long-term leases and toll roads.

Urgent attention will be paid for a few weeks to America's highway bridges -- 15 percent to 25 percent of which are believed to be structurally deficient -- because of the collapse in Minneapolis.

But attention ought to be paid in a bigger way to the deficiencies in America's highways, its electric grid, railways, airports, waterways and urban utilities. They all are clogged, inefficient, a sap on the nation's productivity and competitiveness -- and, in some cases, dangerous.

What's needed is bipartisan action. Republicans, starting with President Bush, have to agree to spend more money and increase taxes, especially the gasoline tax. Democrats need to convince environmentalists to stop blocking needed projects and agree to let the private sector have a greater role in building public infrastructure.

The attitude Kondracke recommends is the right one to have. Let's not start the much-delayed national conversation about infrastructure by putting anything off limits.

Posted by Carter Wood at 7:49 AM | Click here to comment | Send to a Friend

August 14, 2007

DOT Secretary on Infrastructure/And The Germans

Transportation Secretary Mary Peters was on CNN's Late Edition on Sunday, speaking with substitute host Joe Johns. Nothing too exciting, but it's good to see the Administration addressing infrastructure issues directly. In an interview that spent a lot of time on earmarks, Peters framed the underlying question as President Bush has: Are infrastructure dollars being spent the right way? From the CNN transcript:

Joe, I've often said that I've never see a politician getting misty-eyed cutting a ribbon on a maintenance project. Most of them don't want to do those. But I think the bridge collapse, this terrible tragedy -- and our hearts, our thoughts and our prayers continue to be with those in Minnesota -- is keying up a very, very important discussion that we need to have about infrastructure in the United States.

Meanwhile, across the pond, the German elites find the bridge collapse an excuse for another round of Ami-bashing. From Davidsmedienkritik, the leading media criticism site in Germany.

It wasn't entirely unpredictable. When the bridge in Minneapolis collapsed, we at Medienkritik realized it was only a matter of time before members of the German media would attempt to interpret the tragedy much as they interpreted the New York power outage several years ago: As a sign that America is in a state of total collapse and decay.

Well - we didn't have to wait long for the disingenuous sensationalism to materialize. SPIEGEL ONLINE's Marc Pitzke - the anti-American hack-of-hacks - quickly came out with a piece that headlines: "Collapse of the US Infrastructure." The article features a seven-part photo series entitled: "US Infrastructure: Decayed, Ailing, Defective."

Not only is this headline beyond constructive criticism - it is more of the same cynical bashing that we have grown accustomed to in German media. It is nothing more than the usual - cheap and arrogant - hatred that German media consumers keep slurping down and sucking up. Deep down people like Marc Pitzke want to prove to themselves - at a highly visceral, ideological level - that the American system of capitalism is inherently inferior to their own statist, socialist model. So any opportunity to claim that America is in a state of total decay and collapse is taken with great relish.

Actually, some of the elite German criticism resembles the more condemnatory critiques we've seen here in the United States; in both cases, the criticism is more a matter of counting political coup than offering a constructive course of action.

Posted by Carter Wood at 9:16 AM | Click here to comment | Send to a Friend

August 9, 2007

Infrastructure and Human Fallibility

The excellent blogger Varifrank, a software engineer by trade, points us to a book in this post that looks promising, "To Engineer is Human: The Role of Failure in Successful Design," by Henry Petroski. While Varifrank declines to point fingers for the Minneapolis bridge collapse -- and there is way too much of that early blame-fixing by callous exploiters seeking political advantage -- he does have this say about the book:

The book recounts several large scale engineering failures and how many of them were caused by simple, small never before seen and often overlooked errors. I don't know what caused this event and I don't think anyone does, but I suspect that we may be looking at something that will eventually end up in the second edition of Mr. Petroski's book.

Petroski, a professor of civil engineering and history at Duke, had an op-ed in the The Los Angeles Times last week, "Learning from Bridge Failure." Conclusion:

No matter how carefully bridge designers anticipate failure on the drawing board (or computer screen), their structures will only be as reliable as how carefully built, maintained and inspected they are. Just because a bridge has given decades of successful service under adverse conditions of increasingly heavy traffic and neglect does not mean that it will continue to do so. It is the function of regular and careful inspections to catch what designers might not have anticipated.

In the wake of Minneapolis, there will no doubt be renewed vigilance. More careful inspections and more conservative interpretations of their findings may cause some immediate inconveniences, but they will also likely prevent some imminent failures.

In bridge design, as in all structural engineering, success can breed hubris and catastrophe, while failure nurtures humility and caution. Unfortunately, it does seem to take a collapse to re-sensitize inspectors and operators to the real dangers that lurk among rusting steel and cracking concrete. Let us hope that the lessons learned in Minneapolis are not forgotten once more.

There's good, implicit advice in there for all of us entering the policy debate about infrastructure: Practice humility and caution.

Posted by Carter Wood at 8:48 AM | Click here to comment | Send to a Friend

August 8, 2007

Infrastructure: A Coalition and Hard Work to Come

The NAM has been working on infrastructure issues for some time now, recognizing that limited capacity and uncertain reliability can seriously hinder economic growth. Speaking last October at the Minnesota Manufacturing Summit, NAM President John Engler called for bipartisan cooperation to address the country's transportation and shipping needs.

The competitive reasons are obvious. “USA Today” recently reported on China’s expansion of its airport facilities.

The country will spend $17.4 billion over the next five years to build 42 airports in cities stretching from the Russian border in the northeast to the high Tibetan plateau in the southwest. Chinese planners have orders to expand 73 airports and to move 11.

A terminal being built in Beijing is seven stories high and 2.4 miles long —the world's largest airport terminal when it opens to greet Olympic visitors in 2008.

Infrastructure is particularly important to states like Minnesota in the middle of the country, which must ship their products out-of-state, and increasingly, are exporting their goods abroad.

Last week's fatal bridge collapse has, tragically, only reinforced the need to act in a serious way on infrastructure. Committed to a positive contribution to the debate -- to positive action -- the NAM today announced formation of a coalition, the Alliance for Improving America’s Infrastructure. Governor Engler explained the coalition's goals on the radio today.

As horrible as the bridge tragedy in Minnesota was, it really brought home the importance of a reliable infrastructure. Roads, bridges, airports, harbors: They’re the foundation of a strong economy for any nation. But we’ve now seen that they’re also a matter of life and death. That’s why the NAM is forming a coalition to work on a national infrastructure strategy. Plans are coming out of the Congress, out of the Department of Transportation, but manufacturers’ expertise is necessary. We’ve got incredible experience and knowledge that we can draw on when it comes to infrastructure. We need a modern, reliable and safe infrastructure, not just for the economy, but for the safety of our citizens.

The NAM's news release about the new alliance is here, and it includes a video clip of NAM President Engler discussing infrastructure.

Much more to come on this in the days ahead.

Posted by Carter Wood at 5:58 PM | Click here to comment | Send to a Friend