Richard Nelson

“Debt load weighs on Alameda Corridor”

In economics, notes and observations on 2010 September 4 Saturday at 22:32:10

This article from The Los Angeles Times gives a pretty fair view of my most important client, the Alameda Corridor Transportation Agency. The Corridor was originally intended to smooth transit of intermodal containers from tidewater to the two big railyards east of downtown Los Angeles. As the article says, the rise of “transloading” facilities inland has diverted traffic not so much from rail as from the Corridor. The tariff that underpins the Corridor was written before transloading became a notable factor in overseas trade.

As an aside, one thing the article gets wrong is that comment about “lighter” containers. Most maritime goods are carried in containers 8 feet wide, 8½ feet tall, and 40 feet long—yielding 2720 ft³. Intra-continental trade, whether by road or rail, can be carried in containers still 8 feet wide but 9½ feet tall, and 53 feet long, i.e., with a volume 48% greater at 4028 ft³.

Transloading is typically taking goods from particular production locations (e.g., Barbie dolls from factory X, women’s shorts from factory Y) carried in containers directly from those locations, and putting them in containers bound for particular consumption locations (e.g., some Barbie dolls and some shorts in the same container, bound for a Wal-mart in the Kansas City suburbs).

Probably the only real “solution” (if such it be) is to encourage the construction of transloading facilities very close to tidewater—which means in Wilmington and western Long Beach—so that it would be economical to “dray” the containers to the facilities, and then take them by train to their inland destinations. This would have the incidental effect of reducing the truck traffic on the Long Beach Freeway (I-710), one of the festering political issues of Los Angeles County. (The ports, to their credit, have been investigating more innovative—some might say wild—ideas for moving containers inland. Although taken individually they may seem candidates for the Golden Fleece Award, I take them more as relatively inexpensive investments in bread cast upon the [almost literal] water—rather like the projects of the Long Range Foundation in Heinlein’s Time for the Stars.)

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