Editorial: Waterways Neglect Is Having A Negative Impact

Offhand, our editorial headline would seem to fall into the "duh" category. Yet, it has been all but impossible to convince government on a large scale that neglecting the navigation infrastructure of our inland waterways is having a negative impact on the nation's economy.

When it comes to water resource development, maintenance and modernization, our forward look is not very forward. As the Bible entreats us, we should "count the cost" of our actions (or inaction).

Due to neglect of our water transportation infrastructure, we in the United States have become somewhat of a laughingstock around the world. We are despoiling an inland waterways system that clearly can be utilized to make life better. In Europe, planners see waterways as a way to preserve the environment, improve highway safety and, in short, produce a better quality of life. South America sees waterways as a way to compete with the U.S. for export markets.

Neglecting waterways is contributing to negative impacts. For example, as the New Orleans Times-Picayune tells us, the Port of South Louisiana at LaPlace is losing ground in that it has experienced a tonnage decline in recent years.

"For much of the grain harvested in the Midwest to be shipped to Asia, the state has been the final U.S. stop before the long trip across the Pacific Ocean. And the flow of grain has given Louisiana its own financial harvest, supporting jobs and generating money at local ports and grain storage facilities. But all that has started to change now that increased shipping costs have made Louisiana a more expensive stopping-off point," says the newspaper. "It's not a huge reduction, but nonetheless in our market a 5, 6, 7, 8 percent reduction is significant," grain handlers explained.

Shipments of corn, soybeans, wheat and animal feed fell 7.5 percent last year at the LaPlace facility, which is the largest grain port in the nation in terms of the tonnage handled. The drop from 2002 figures has been 23 percent.

A long-term contributor to these declines (and for other loss of river business) is the unreliability that ongoing neglect brings to the waterways. Major lock outages along our century-old system of locks and dams have resulted in losses totaling in the millions for just the towing industry alone. An unreliable river system does not encourage customers to ship by barge.

Political decisions also produce negative impacts. U.S. steel tariffs imposed in 2002 pinched off the flow of imported steel, depriving towing companies of profitable "back hauls." The tariffs were discontinued, but the flow of import steel did not bounce back. So chartering barges to tidewater is more costly.

As the Times-Picayune explains, a growing amount of grain being produced in the Midwest is moving by rail to the Pacific Northwest. Increased barge rates are only part of the reason. Growing demand for ships to and from Asian markets is a major factor. The cost for ships has skyrocketed.

Last year, it cost an average of $37.59 per ton to ship ocean freight from the Pacific Northwest to Asia and $58.98 per ton to ship from the Gulf of Mexico, the U.S. Department of Agriculture reported. That $21 difference was more than enough to eat up savings shippers might garner by barging product to the Gulf. The same costs five years ago were $11.38 for the Pacific Northwest and $18.22 for the Gulf—a difference of $6.84. The difference in cost reached a 20-year high in April.

While Gulf ports are suffering from high ocean rates, Pacific Northwest ports in Portland, Ore., and Seattle, Wash., saw record grain shipments in 2004. Portland saw an increase of 30 percent, while Seattle realized a 25 percent increase.

Unless the world goes on a gigantic shipbuilding binge, it would not appear that the cost of ships would decrease anytime soon. Observers say they see no relief in sight. They say that the force behind ocean freight rates is the "growing Chinese economy," not the U.S. grain market.

The combination of high shipping costs on blue water and the impact of growing unreliability of an antiquated river system is damaging to the towing industry and, ultimately, to the U.S. economy. Renewed interest in proper waterway maintenance and modernization could do wonders for the job market, which has needed a healthy boost for years.

Contending with fickle nature is enough of a challenge for river-related industries. Having to put up with an antiquated navigation system suffering from neglect is the last thing we need if the U.S. is to prosper as it surely can if we take care of our infrastructure.

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