The following series of posts is an indulgence. For the past 18 years, and in some ways for the past 30, I’ve become increasingly upset about the way this country and state have sold out the future, and the way the accretion of privileges by entitled special interests has prevented much from being done to turn things around. As a result a resurgence by the City of New York over the past 30 years, previously laid low by similar future self-dealing and future-selling a generation or two ago, is now threatened from without. This frustration is reflected in my writing here on Room Eight.
But it isn’t the case that I am no longer capable of thinking big thoughts about what could be done to improve the common future. These thoughts could be useful in a different place, as in parts of Europe or Asia, or in another time, like the United States at any point in its history until the recent past – back when building a better future for those coming after is something most Americans aspired to. Today all the money is going to debts and pensions and health insurance paid to those 55 or over, at the expense of those 54 and younger, not to investment in a future very few care about. Because those 55 and over wanted benefits for themselves, but didn’t want to pay for them – and now that the country is broke and would prefer to deny to those coming after so they can keep borrowing. But I might as well indulge myself. The following posts describe a pipedream, not a proposal, not because what is laid out is impractical, not useful, or is inherently (as opposed to politically) expensive. It is a pipedream because we are in the Vampire State not Empire State, and this is the era of Generation Greed.
Railroad Pipedream: The Problem
Most New Yorkers don’t think about it, but there is perhaps no part of the United States that provides as little accommodation for the movement of goods as the portion of the New York metro area east of the Hudson River. Some of this is an outcome of history. Much of the center of the region was built before the start of the motor age, and it is the most densely populated part of the United States, so there is relatively little highway and street capacity relative to its population and economy. The majority of Downstate New York also happens to be located on Staten, Long and Manhattan islands.
But some of it is the result of policies that give preference to private motor vehicles and passenger rail. Many of the region’s highways are parkways where commercial traffic is prohibited. There are few streets that qualify as truck routes, and local neighborhood groups tend to object to trucks passing through. And rail is hardly an option, as connections to the national rail network west of the Hudson River are limited, and run on lines that give preference to commuter rail. As one transportation planner I heard speak once put it, people don’t like trucks, but they like the things that come in trucks. That is the problem.
Almost everything that people buy or use is going to be delivered to the place where they buy it, or to their home if they order in off the internet, in a truck or van. There is not and will never be much of an alternative, unless something can be moved in a pipeline or on a bicycle. The question under discussion here is how stuff gets into the East of Hudson area from other places, to the general vicinity of where it will be used. And for those who haven’t been following trends in freight movement, some background is required.
Today, much of the stuff that is used in the portion of the New York metro area east of the Hudson River travels by truck over its entire distance. Trucks took the place of railroads and barges many years ago, for all but the bulkiest, heaviest, cheapest and least time sensitive freight – things like coal; grain and grain mill products; wood, lumber, pulp and paper products; metal ores and metal products; and, ironically, motor vehicles. The New York area has few industries left that produce these goods or use them as inputs. Among the materials moving in and out of Downstate New York only three are on the list of those commonly traveling by rail – food and kindred products, building materials, and garbage.
Trucks replaced trains for the long distance movement of finished products due to several public policy decisions and economic trends.
First, the federal government paid to build the interstate highway system using tax dollars, even as the privately built and financed rail network paid federal and state income taxes and local property taxes. While trucks move across the country on modern, grade separated (no stoplights) high-speed highways, railroads move on the equivalent of the U.S. Route system that preceded the Interstate Highway System. The typical rail car moves across the country at less than 30 miles per hour, after spending an average of 24 hours in a terminal waiting to be hooked up to a locomotive, to be hauled to another terminal for another 24 hour wait, as described in the data on this website. That is the average for intermodal freight, not bulk freight.
Note that the main railroads serving the New York area are CSX, Norfolk Southern and Canadian Pacific. These railroads were each awarded a piece of the former Conrail when northeastern railroads were privatized in the 1980s. All the northeastern railroads had previously gone bankrupt and were taken over by the federal government in the 1970s as part of Conrail.
Second, the period from the 1950s to 2000 was a period of relatively cheap motor vehicle fuel for trucks, which offset one of the main advantages of railroads – they use less energy to move a given amount of freight.
Third, in the aftermath of trucking deregulation under the Motor Carrier Act of 1980, the labor cost of freight movement by truck fell as well. As in the New York City taxi industry, truck drivers who had previously been employees of companies with fixed hours, overtime, and benefits became “independent contractors” without those advantages. While some prospered, at least in the short run, a rising number of competitors cut the rates they could charge and increased the hours they needed to drive. Many independent truckers, in fact, violate federal highway safety limits, which limit them to 14 hours worked including just 11 driving, followed by 10 hours of rest. The failure to take the legally mandatory rests is a danger for everyone on the road – and a particular danger in places like New York City, where traffic can make a truck delivery take much longer than planned.
While trucking labor was getting cheaper, railroads continued to be burdened by featherbedding in union contracts dating back to a time when railroads were a monopoly. And as the railroad industry shrunk, it was burdened by the huge cost of the more numerous retirees from the time when it was larger. These differences offset another would-be advantage of railroads. While a truck driver can only move one or perhaps two trailers across the country, a small railroad crew can move up to 100, so the labor cost of moving freight be rail should be lower.
More recently some of these factors have turned in favor of railroads. Highways are increasingly congested and, due to federal and state budget crises, less and less well maintained compared with the privately-financed railroads. The gas tax, used to finance those highways, is not increased for inflation. Many states are contemplating higher tolls as a way to cover the cost of maintaining their roads, and other costs. For example, Pennsylvania has repeatedly sought to get federal permission to put tolls on Interstate 80, which would raise the cost of moving goods by truck into Eastern Pennsylvania and on to Downstate New York. Higher tolls have also been proposed for the New Jersey Turnpike. Meanwhile, over time the worst abuses in the private railroad contracts have been eliminated, and most of the retirees from the days when the railroad industry was the largest in the country have died. And energy has become more expensive.
Railroads have increasingly gotten into the business of transporting trucks over long distances, either carrying the trailer portion of a tractor-trailer to a place where another tractor can pick it up, or carrying a shipping container to a port or rail yard (now being called railports) where it could be loaded onto a tractor and flat trailer. As of now, this is a small part of the total freight railroads carry, but some expect it to increase. Virtually off the goods that arrive in the New York area by train or ship, however, arrive in New Jersey and must travel across the Hudson River to the eastern portion of the metro area by truck.
Another major trend over the past 30 years has been the rise in imports of finished products, supplanting manufacturing within the United States. This means that less of the raw and intermediate materials typically transported by railroad are moving around the United States. It also means that much of the growth in freight transportation – and industrial real estate – has been in the distribution of finished products produced elsewhere. The logistics industry is one of the few that has become radically more productive in the U.S. in recent decades. It is able to move, sort, and deliver goods at a drastically lower cost than in the past. Along with information technology, it is one of the greatest economic success stories in the U.S. in the past 30 years.
With trucking labor and energy relatively cheap, the past two decades has seen the growth of mega-warehouses serving large areas of the country. A national retailer, rather than having a distribution facility in New York City to serve its stores in the city, or a distribution facility in New Jersey to serve the New York metro area as a whole, might have a single facility to serve the entire Northeast. Trucks leaving from such a facility travel directly to every freight destination from Maine to Virginia to Ohio. Smaller retailers, similarly, often have their goods delivered from mega-warehouses owned by third party logistics firms. Even goods that have to be produced relatively locally are now produced in fewer, larger facilities and trucked longer distances to their final destinations. Perishable food such as supermarket baked goods, for example.
With the shift to mega-warehouses, the 2000s saw the emergence of eastern Pennsylvania as the industrial center of Northeast, “America’s Warehouse.” Rail served mega-warehouses located in this area take in goods arriving by either truck or railroad, and ship them out to destinations everywhere from Northern Virginia to Maine by truck. This area has the railroad connection that the New York area does not, and has less congested highways – it is now described as the I-81 and I-78 corridors. In addition to warehouses, eastern Pennsylvania is now home to most of the food processing plants that serve the New York market. You can see this by checking the bread aisle at your local supermarket, and noting where it was baked.
Eastern Pennsylvania’s closest competitor as a distribution center for the Northeast is the large concentration of warehouses around Exit 8A on the New Jersey turnpike. Exit 8A is also where much of the freight arriving at the Port of New York and New Jersey is brought to be sorted and shipped. More recently, however, Exit 8A has become less competitive, because the New Jersey Turnpike is so congested south of the point where it shifts from twelve lanes down to six.
Today, with energy becoming more expensive and roads more congested, there has been some indication that distribution might shift back to a larger number of facilities, each serving smaller areas. The question is whether in the future New York might want, or perhaps need, to have the goods required by the Downstate region east of the Hudson to be distributed from facilities located there, rather than a day’s truck drive away or across the river in New Jersey. Whether by road or rail, however, freight access to the Downstate region is extremely limited, as described in this Port Authority report.
To get into New York City, Long Island, or the Lower Hudson Valley, large trucks must use the Verrazano Bridge, the George Washington Bridge, or the Tappan Zee Bridge. All three bridges are congested, and the Tappan Zee is in need of replacement, with a future that is questionable. With the parkways off limits to trucks and few other highways, large trucks must then use the Cross Bronx Expressway, Staten Island Expressway/Gowanus Expressay/BQE, and/or Van Wyck Expressway to get into the Downstate New York region. These are three congested, dangerous roads that as a driver I make a point of never, ever using myself.
After exiting these highways, trucks face a limited number of through truck routes on local roads. Take Brooklyn, for example. As shown on this map, aside from the Gowanus/BQE and the Prospect Expressway, there are only two through truck routes for a borough of 2.5 million people. There is Atlantic Avenue with a spur on Flatbush Avenue from Atlantic to the Manhattan Bridge. And there is McDonald and Church Avenues off the Prospect Expressway, and then Flatbush Avenue south to the Rockaways.
Metro New York’s highways and streets are crowded for people and their private motor vehicles too, not just for freight. But at least those who choose to drive often have an option – the rail transit option – that allows the crowded streets and highways to be avoided. The rails are much less an option for Downstate New York, as the only two connections to the west are the rail tunnel to Penn Station, used exclusively for passenger trains and with too low a ceiling for freight, and a bridge up north near Albany. From the bridge south of Albany, a single freight track on the Hudson Line brings freight to the Bronx. The detour to Albany adds a full day to the trip for freight coming up from the south, and with just one track for both directions, the amount of freight that could be moved this way is limited in any event. Trains can’t use that railroad to go north and south at the same time. So most freight that arrives in the New York area by railroad is delivered to New Jersey, and moved across the Hudson by truck from there.
While many railroads across the nation are stuck in the past, in fact, New York State’s rail network, shown here, is actually much diminished from what it used to be. Once upon a time the New York Central railroad from New York City up to Albany and across the Buffalo had four tracks; today it has just two for most of the distance north of Croton Harmon. CSX, which now owns and operates this route, has objected to its use for high-speed passenger rail because there would not be enough capacity for the freight moving by train on the two tracks that are left. Objections from CSX are one reason New York got relatively little high-speed rail money from the federal government.
There was once an additional two-track railroad that ran north to Albany on the west side of the Hudson River, and then west to Buffalo – the West Shore Railroad. With its level grade and wide turns, it was used for fast express freight after it was merged into the New York Central. Today, it is largely abandoned from west of Albany to Buffalo. If it were not, freight could run on its tracks on the other side of the Mohawk River from the existing CSX tracks, which would then be free for faster passenger rail.
South of Albany, the former West Shore railroad remains the major rail freight route to the New York area from the north and west. It is in many ways a quality railroad, with few streets and roads crossing it at grade. But it only has one track along much of its distance, which limits its capacity, and trains run along it slowly – at about half or less the speed of trucks on the New York State Thruway. And it terminates in New Jersey, not east of the Hudson.
At one time New York State was also served by another major railroad, the Erie Railroad which ran along the Southern Tier of the state from Buffalo to Binghamton, then south to New Jersey on the west side the Hudson. This railroad is now owned by Norfolk Southern, but relatively little used. In New York State it is mostly one track rather that the two it used to have, and as part of the Port Jervis line of MetroNorth, that track is currently washed out.
While New York State’s railroad network has faced disinvestment, moreover, elsewhere in the country there is growing reinvestment in rail. With energy prices rising and government investment in roads falling, big bets are being made on the growth of rail transportation. For example, Warren Buffett’s Berkshire Hathaway purchased another major U.S. railroad (there are only five left), the Burlington Northern and Santa Fe (BNSF).
The railroads are building huge “railports” where trucks trailers and containers can be delivered to be moved across the country on trains, saving labor and energy. Several are under development in metro Kansas City. There is one in San Antonio, known as the “port of San Antonio” even though that city has neither an ocean nor a navigable river. The former Alliance Airport in Fort Worth is also being developed into a massive railport and distribution center. So while a railroad renaissance, with improved transportation and enhanced economic competitiveness, sweeps the country, Downstate New York remains virtually cut off while Upstate New York is left with single-track lines, passenger train conflicts, and old signals. Should energy prices continue to increase, and freight travel by train and local distribution become more common, Downstate New York would face a higher cost of living, Upstate New York would face a missed economic opportunity, and the Port of New York and New Jersey would become less competitive and lose out to other Atlantic ports such as Virginia’s Hampton Roads.
What should be done about this?
Probably nothing, because our state legislature is controlled by self-dealing interests who would rob us blind and leave us with nothing if we tried. Since we already have the highest state and local tax burden as a share of personal income, and more and more money is going to debts and pensions as the interests that control our state legislature cash in and move out, that is money the serfs and younger generations cannot afford.
OK, but just for the sake of interest, what could be done about it? That is the subject of the next few posts.