In April, the Surface Transportation Board, the regulatory agency charged by Congress to resolve railroad rate and service disputes, hosted a public hearing on service issues. The list of those testifying about the woes created by enormous rail service failures across a wide range of industries was quite impressive.
It seems most segments of the rail shipping or receiving community have been adversely affected by the latest meltdown in rail service, including shippers of grain, fertilizer, coal, and petroleum, as well as Amtrak passengers. The effect on my company, Cargill, and our customers has been enormously detrimental.
I have worked closely with the railroads for many years and have witnessed mergers, car shortages and service disruptions caused by multiple problems. I’ve also experienced times when rail cars were in such surplus that the industry was running out of places to park unwanted equipment.
Once in a while shippers and carriers find themselves with just the right amount of capacity. But more often, we find ourselves with a shortage or excess of capacity as the economy improves or falters.
It is not easy to predict demand for rail shipments because it is seasonal and dependent on many factors, many of which are beyond rail carriers’ control. Right-sizing a transportation company is like hitting a moving target.
At the Surface Transportation Board hearings there were a lot of complaints by shippers, with carriers promising to do better and improve service. To the railroads’ credit, they have invested significant capital to increase capacity.
Still, there is not an infinite amount of railroad capacity, nor can capacity be created overnight. So how does our nation meet the transportation needs of a growing economy?
We need a national comprehensive transportation strategy if we want to improve the economy. This strategy must include our ports, rails, roads and rivers.
We must invest in our nation’s infrastructure now. The Water Resources Reform Development Act, a policy bill related to a broad range of water resources, is expected to move out of Congress soon and become law.
At a time when our highways are congested and crumbling and our rail capacity is bursting at the seams, we must reinvest in the nation’s waterways’ infrastructure. Besides passing Water Resources Reform Development Act, we must increase the amount of money being invested in our locks and dams by raising the user fee that towboat operators currently pay and that those operators and shippers fully support.
Our government must continue to fund the operations and maintenance of our waterways to serve increasing exports and imports. Maintaining and modernizing the nation’s waterways’ infrastructure is an affordable and obvious way to raise the nation’s transportation capability along with its economy.
Congress and the Obama administration must improve our waterways to position our nation for the century ahead.