Impact of Trade on U.S. Infrastructure - Global Trade Magazine
  June 17th, 2015 | Written by

Impact of Trade on U.S. Infrastructure

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  • The largest 25 ports move 85% of all #internationalgoods, only 4% of these goods start or end in their local markets.
  • #Trucks are the backbone for the nation’s entire #freight network—moving more than ⅔ of all U.S. goods annually
  • Regions depend on an efficient, well-integrated #infrastructure network to exchange goods with other markets

The Washington, D.C.-based Brookings Institute has released its first-ever, two-part analysis of the impact of the trade in goods on U.S. metropolitan regions and what it sees as the country’s need to prioritize freight investment.

Compiled by Brookings and the Economic Development Research Group as part of its Global Cities Initiative, the reports “illustrate how a small collection of metropolitan markets produce, consume and distribute the vast majority of all U.S. goods. A concentration that” the report continues, “puts enormous pressure on specific infrastructure, and demonstrates how problems in one market can spread across the entire country.”

The first of the two reports—The Great Port Mismatch: U.S. Goods Trade and International Transportation—focuses on how the country’s international ports—the water, air, and surface transportation facilities that handle its exports and imports—function at the metropolitan level.

The report finds that, “while the largest 25 ports move 85 percent of all international goods, they primarily serve customers in other parts of the country. With only 4 percent of their goods starting or ending in their local markets, these ports are true national assets.”

From the perspective of the country’s deep-water ports, “these flows create an enormous logistical burden for serving hundreds of different areas across the United States,” says Adie Tomer, report co-author and an Associate Fellow at Brookings. “Public policies must recognize the hierarchy and mechanics of international trade flows. That will require a policy framework that prioritizes specific places to boost trade for the entire country.”

The findings are especially timely considering the prospective impacts of the expanded Panama Canal and potential trade deals, like the Trans-Pacific Partnership (TPP), on total international trade.

“Whether one supports trade deals or not, their passage is likely to increase goods movement at the few ports handling most of the country’s Asian trade,” he says. “Adding the potential impacts from an expanded Panama Canal, now’s the time for federal leaders to work with state and local officials to boost investment inside and outside major ports.”

 

INFRASTRUCTURE IMPROVEMENTS DEPENDENT UPON INVESTMENT, PLANNING AND POLITICAL WILL

The second report —Metro Modes: Charting a Path for the U.S. Freight Transportation Network—supplements the international analysis by exploring the domestic freight network in greater depth.

“While a variety of transportation modes—including airports, railroads and waterways—help stitch these regions together, trucks serve as a backbone for the nation’s entire freight network, moving more than two-thirds of the volume of all U.S. goods annually,” the report says.

At the center of these movements are the country’s 100 largest metropolitan areas, which account for 60 percent, or $8.1 trillion, of all goods that travel by truck. “In particular, metropolitan areas that neighbor each other and have similar economic specialties can depend on trucks for 90 percent or more of their freight activity, as evident in places like Kansas City, St. Louis, Baltimore and Washington, D.C.”

Throughout the country, “regions depend on an efficient, well-integrated infrastructure network to exchange goods with other markets,” says Joseph Kane, a Brookings Institute senior research assistant and report co-author.

“Freight policies impact the entire country and those who craft them,” he says, “must begin to recognize how certain places and infrastructure assets are central to this network—whether it is trucks moving electronics, pipelines moving energy, or air modes carrying high-value precision instruments.”

As congestion costs rise and budgets for infrastructure investment shrink across the country, the report concludes that, “federal policies must do a better job recognizing the outsized benefits the entire country receives from efficient connections to these key markets and assets.”

At the same time, leaders at the national, state and local level can support more efficient goods movement by developing freight plans, policies and investments in light of regional trade and transportation specialties.


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