The Last Mile: The election's over

The election's over

Consumers vote with their wallets and with their feet. Since you can't sell goods that aren't on the shelves, the outcome of the 2004 retail elections may already have been decided in favor of the candidate with the best logistics platform.

The National Retail Federation (NRF) estimates holiday spending will reach $219.9 billion, which represents over 20% of annual retail sales. NRF says it takes into consideration the overall consumers' mood in predicting a respectable but slower growth rate of 4.5% in holiday spending. However, the NRF didn't even mention bottlenecks at ports, congested rail networks, tight trucking capacity, and added security requirements — factors that may not influence consumers' willingness to spend, but certainly affect their ability to spend.

The country tends to respond to crisis, says John Ficker, president of the National Industrial Transportation League. The problem is, there may not be a perception that a crisis exists. Ficker sees the challenges of transportation infrastructure in every mode and the potential impact it will have on the flow of commerce over the next three to five years.

It isn't just the ports and highways, rail has it share of problems and even the lock and dam network needs work, says Ficker. These issues are real and ongoing, and economic growth will force us to deal with them. "I don't know that there's the political will to deal with it," Ficker laments.

Movement on critical legislation to fund transportation infrastructure has certainly been agonizingly slow. The Transportation Equity Act managed to move through the Senate and its version was incorporated into the House of Representatives bill, but that bill has remained in conference and is unlikely to move before the November elections.

The infrastructure funding bill won't offer immediate relief to the problems plaguing the transportation industry, but delays are already having a ripple effect at state and local levels where funding is needed to maintain and develop critical infrastructure links.

The budget crisis in California led the Port of Los Angeles to take on responsibility for a critical truck link between container terminals and the Alameda Corridor. With a current growth rate of 1 million TEUs per year, the Port of LA can't afford not to tackle these major infrastructure issues.

Other West Coast ports like Tacoma are reporting steady traffic through container terminals. Growth may account for some of the flattening of their peaks, but if you're running at full capacity, that seasonal peak has to find another path.

Ingenuity can take us only so far before we've exhausted our alternatives. If President Bush is returned to the White House, the logistics community must ensure the Transportation Equity Act is a top priority. Senators Kerry and Edwards didn't vote when the Senate passed the bill and sent it to the House, but if John Kerry is elected president, we'll have to urge fast action. To paraphrase an earlier political slogan, it's the economy, don't be stupid.