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Issue #588

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Intermodalism

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2014 Media Kit
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US Chamber chairman warns of $1 trillion funding shortfall

By: | at 08:00 PM | Breakbulk & Projects  

By Paul Scott Abbott, AJOT

As a top executive of a major US corporation, Gerald Shaheen is very familiar with the importance of our major seaports, and as elected leader of the world’s largest business federation, Shaheen is part of ongoing efforts seeking to ensure a transportation system capable of handling increasing trade flows.

In a Sept. 12 keynote luncheon address at the 95th annual convention of the American Association of Port Authorities at the Hilton New Orleans Riverside, Shaheen cautioned that the cumulative funding shortfall through 2015 to meet US transportation system improvement needs will reach $1 trillion.

Shaheen, who is group president of Peoria, IL-based Caterpillar Inc., and chairman of the US Chamber of Commerce, said the shortfall figure is among numbers presented in a study conducted last year by Cambridge Systematics Inc. for the National Chamber Foundation of the U.S. Chamber of Commerce ’ numbers that underscore the need for a concerted effort to secure transportation funding.

‘Caterpillar’s success depends on the safe, efficient movement of goods, and, you see, everyone’s business does,’ said Shaheen, citing Caterpillar’s annual movement through US ports. The company exports and imports product valued at some $14 billion. Caterpillar’s trade partners include 40 nations.

Not only is Shaheen concerned about Caterpillar’s transportation demands, but he also represents more than three million US businesses in his US Chamber role.

Shaheen said freight transportation providers, shippers, and port authorities must work together to estimate costs of infrastructure needs, come up with solution options, and present their findings to Congress.

‘To continue to lead the global economy, we must work together to develop the best transportation system there can be,’ he said. ‘A lot is at risk here, including our very way of life.’

AAPA and the US Chamber are among several business and transportation groups that make up the Freight Stakeholders Coalition, which has been advocating for increased freight planning and infrastructure investment over the last three reauthorization cycles for federal transportation funding.

Shaheen said the signing a year ago of the Safe, Accountable, Flexible, Efficient Transportation Equity Act for the 21st Century ’ A Legacy for Users (SAFETEA-LU) did little to address funding for highway improvements needed to support the anticipated doubling of the nation’s international trade volumes by 2020.

He warned that the Highway Trust Fund is not the answer, as it will run out of funds by as early as 2009.

Shaheen urged the indexing of motor fuels taxes to inflation as one short-term approach. He also suggested exploration of various alternative funding methods, from bond financing to tolling.

‘Tolls are an option but not always a solution,’ said Shaheen, who noted that only three percent of US highways currently are toll roads.

Speaking the day after the five-year anniversary of the tragic events of Sept. 11, 2001, Shaheen said the nation’s ability to handle growing trade flows will have significant dependence upon implementation of security procedures that do not unduly disrupt commerce.

Maintaining appropriate security while keeping cargo moving will require adherence to four principles, according to Shaheen:

  • Deployment of a ‘common-sense, cost-effective approach’ that does not require physical or radiologicial screening of every container as it enters a US port,
  • Reliance on ‘voluntary and flexible’ partnerships, such as the Customs-Trade Partnership Against Terrorism (C-TPAT),
  • Recognition that solutions vary according to circumstance, ‘that one size does not fit all,’ and
  • Approach to challenges on a global supply chain basis, such as through screening of US-bound cargo containers at ports of origin.

‘There’s going to have to be give and take,’ Shaheen said.

He said he is ‘absolutely convinced’ a combination of solutions can be implemented that maintain secu