SCDigest
Editorial Staff
| SCDigest Says: |
 An interesting coalition of rail unions and major rail shipping organizations is calling for re-regulation of the railroads. Wolfe says a re-regulation bill gained more traction in 2007 that any such effort had achieved in recent memory, and that while largely forgotten in the election year, the issue is likely to re-emerge soon.
Click Here to See Reader Feedback
|
What are the top transportation and logistics-related issues that the new presidential administration will need to deal with – regardless of who the winner is this week?
Ed Wolfe, president of Wolfe Research and former Bear Stearns transportation industry analyst, last week identified the 10 key issues he believes the winner will need to grapple with when he takes office in 2009.
1. The Next Highway Re-Authorization Bill: The last highway bill was passed in 2005 and expires in 2009, and authorized $286 billion in infrastructure spending, although critics claimed too much was unneeded pork (as much as 18% by some estimates).
The debate for a bill in 2009 is likely to be contentious. Some may argue big spending will be needed not only to improve infrastructure but to create jobs if the economy is still wobbling. A group representing state highway officials has called for almost doubling the spend in the last four years, to $545 billion, and other industry groups have also called for major investments. But where is the money coming from?
2. Rail Infrastructure and Tax Credits: The railroads are lobbying for a 25% tax credit for increased capital investments. There have also been several studies showing the need for rail investments well beyond what the railroads themselves are capable of making. With many also pushing for greater use of rail to move freight to relieve highway congestion and reduce oil consumption, there will be pressure in Washington to improve rail infrastructure.
3. Rail Re-Regulation: An interesting coalition of rail unions and major rail shipping organizations is calling for re-regulation of the railroads. Wolfe says a re-regulation bill gained more traction in 2007 than any such effort had achieved in recent memory, and that while largely forgotten in the election year, the issue is likely to re-emerge soon.
4. Clean Coal Regulation: If carbon emission caps or other changes are enacted that make it more expensive to use coal in power plants or other applications, that ultimately could hurt major rail carriers, which in total derive 23% of revenues and even more profits from hauling coal in the US.
5. Free Choice Act: The proposal to allow unionization efforts to proceed with a so-called “card check” versus secret ballot is likely to re-emerge in Congress regardless of who wins the presidential election, and to get executive branch support if Obama is victorious. This move could lead to unionization at many currently non-union carriers, whose ranks include FedEx, JB Hunt, Werner, and many others large and small. Wolfe notes, however, that many of these carriers have strong relationships with labor and may not see much unionization activity, at least in the short term.
(Transportation Management Article - Continued Below)
|
Transportation Management Focus : Our Weekly Feature Article on Transportation Management Strategies, Best Practices and Technologies for the Transportation and Logistics Practioner 
7. FedEx Reclassification: Wolfe says FedEx’s non-aviation operations for some reason fall under the Railroad Labor Act, which makes it very difficult for its blue collar employees to unionize. A bill was introduced last year to re-classify FedEx and remove that protection, an issue likely to re-surface in 2009. 
