Friday, January 17, 2014
Improving Highway 167 could help change the face of global commerce and the future of Washington state. Really.
Traffic congestion is causing bottlenecks at our ports, creating costly delays for the shippers that use Puget Sound ports. Failing to eliminate that congestion will make our ports less competitive, costing us jobs, business and tax revenues.
That is true now more than ever.
This legislative session, the transportation improvements to be voted on by legislators in Olympia are linked to world trade and events in Panama, 3,600 miles away. What lawmakers decide could determine the fate of our state’s economy for generations.
Here is a little background.
On any given day in Panama, there are as many as 150 ships waiting in line to pass through the Panama Canal, which links the Pacific and Atlantic oceans. Transiting the 48-mile canal can take 20 to 30 hours. Growing delays and the canal’s inability to handle today’s larger ships cost the Panamanian government billion in lost tolls.
To address the situation, the Panamanian people voted overwhelmingly in 2006 to add a third set of locks. The expansion is nearly 75 percent complete, but currently it’s hit a snag because it’s over budget. Originally projected to cost $5.2 billion, the final price tag could exceed $7 billion.
The pause in the canal project is temporary, but it gives Washington state lawmakers an opportunity to greatly improve our state’s trade prospects by reducing the highway and rail congestion that is making our ports less competitive.
Currently, our state benefits greatly from U.S. trade with Japan, Korea, Taiwan and China. One reason is our proximity to Asian ports. A second is that our ports can handle the supersize ships that can’t get through the Panama Canal.
Because those massive ships can’t fit through the canal, they load and unload their cargo at West Coast ports such as Seattle and Tacoma. The cargo is then transferred to trucks and trains headed east and south.
But when the expansion project is completed, the Panama Canal will be able to handle more – and bigger – ships, meaning super freighters will be able to travel more efficiently and economically through the canal to ports on the East Coast and the Gulf of Mexico.
Ports on the Eastern Seaboard are spending an estimated $46 billion by 2017 to prepare for these larger ships. Nationally, the major railroads spent $14 billion last year on equipment and track and bridge improvements. In Washington, BNSF spent $125 million during 2013 for railway maintenance, capacity improvements and expansion projects to be ready for the increased trade.
So, we will soon lose our historic advantage. If we are to remain competitive, we must invest because currently, Seattle and Tacoma ports are mired in gridlock. Time is money, and without completing projects such as Highway 167, shipping companies may have to look elsewhere where transportation to and from seaports is quicker and cheaper.
Those are dollars and jobs lost.
According to Association of Washington Business data, international trade supports an estimated 846,000 jobs in Washington and generated $65 billion in exports in 2012. Washington’s trade-related employment grew three and a half times faster than total employment from 2004 to 2011 – and state exports have grown 50 percent faster than the state GDP since 2002.
Trade is also crucial to small employers in Washington, the source of most of our job growth. Ninety-one percent of Washington exporters are small- and medium-sized companies with fewer than 500 workers.
It is vital that legislators creatively address highway gridlock and approve transportation improvements this year so we can begin eliminating transportation bottlenecks before the expanded Panama Canal opens in two years.
‑ Don Brunell is a business analyst, writer and columnist, recently retired as president of the Association of Washington Business (TheBrunells@msn.com).