As you know, Englishman Charles Darwin (1809-1882) was a naturalist who popularized the idea of survival of the fittest. Those species who could evolve and deal with change survive, he said, while those that cannot perish. These two awards honor his memory.
First, to the docks at the Port of Los Angeles. The 800 members of Local 63 of the International Longshore and Warehouse Union are perhaps the highest paid clerical workers in the world. To shuffle paper, they are paid $165,000 to work eight and a half months of the year, getting the remaining weeks off. And they have job guarantees.
Still, they are not happy. They rejected an offer from the port that would raise their salaries to $195,000 and this week began picketing one of the nine piers. Other ILWU workers honored the picket signs, and in a wink the strike spread to the other piers and to the adjacent Port of Long Beach.
For self-destructive behavior, this is right up there with the bomber pilot who says “I wonder what this button does?” and pushes it. Container ships were diverted to Oakland and to ports in Mexico. The credibility and reputations of the two ports were battered. And forget efficiency. One wonders what Matt Rose, the CEO of BNSF Railrway, thinks of all this. BNSF and Union Pacific are heavily dependent upon these two ports remaining competitive. After all, in just two years an enlarged Panama Canal will open and efficient deepwater ports on the East Coast will be wooing the ships that now call on the West Coast. The Los Angeles Times says up to 100,000 cargo jobs in Southern California are threatened by the Panama project.
Not even a year ago, a video produced by the Jobs1st Alliance showed dock workers and managers saying together, “Beat the Canal.”
So long, farewell, been good to know you, Local 63. Even if the strike wraps up quickly, the damage has been done.
Now on to the second Darwin Award.
It’s profits are slumping, as is its stock price. Plus, its biggest commodity handled is falling off a cliff. Meanwhile, the economy is barely growing, and unless a miracle occurs in Washington, D.C., at year’s end taxes will rise for most Americans, meaning a recession could be right around the corner.
So what does Norfolk Southern do? Why, it publicly celebrates this week an $18 million investment to upgrade its Lamberts Point export coal transload facility in Norfolk! This would have truly been a landmark achievement 20 or 30 years ago. But with coal loadings off 13 percent during the first three quarters of 2012, compared with 2011, you’ve got to wonder if NS just shot itself in the foot.
In fairness, capital investments of this sort are planned far in advance. Plus, it could be that the export business for Norfolk Southern is holding up better than the loadings for U.S. customers. And NS spokesperson Robin Chapman, unbowed, fires back: “Coal is and will remain an important business for Norfolk Southern. Long after the current economic crises settle down, we expect the worldwide demand for coal to be strong for many years to come, and we are committed to providing superior service to our export coal customers. These upgrades were necessary to maintain that capability.”
Still, the timing couldn’t have been worse. And because the work didn’t start until August, it’s not as if NS didn’t know the coal business was going to the dogs.
Railroads: Be careful what you brag about. These are my first Darwin awards for self-destructive acts, but surely not my last. — Fred W. Frailey
Sno-cat, allow me please to amend your nomination. If the person responsible for NJT's Sandy damage is still employed by NJT, I want to nominate for a Darwin Award the person that poor slob reports to. Make sense?
Remember the MidAmerica Corridor anounced by NS and CN almost four years ago in Feb. 2009? There was a lot of money spent on infrastructure improvements but the first coal train has yet to run.
A recent story that not everyone is turning to gas is from Louisville Gas and Electric which will spend $940m to install updated environmental controls at its southwest Louisville facility to allow the facility to continue using Illinois Basin coal.
Sadly, the 'Darwin Awards' should be presented to the endless parade of nincompoops in trucks and cars who try to outrun trains at gradecrossings. Posthumous awards, unfortunately, have little deterent effect.
Fred, I have to say I think you are wrong on the NS award. The Lambert's Point facility exports mostly metallugical coal which has a very different market structure than steam coal. Met coal can be used as steam coal, but many steam coals do not have the right chemical properties to be used as met coal. The market for 'met coal' is a derivative of the steel market. Given global economic weakness, maybe the 'met coal' market is a long-odds bet, but it is not suffering the same environmental regulatory onslaught and the same source competition from natural gas that steam coal is facing. Also the magnitude of this investment is trivial (a bit more than 1% of the NS capital budget for the first 3 quarters of 2012). Hardly what I would call a 'bet-the-company' move.
Attention Wal Mart Shoppers: Prices for all Chinese goods are dropping since containers are going to be coming through Mexico and Prince Rupert, Canada. :-)
It is going to take some serious stimulas money to save these union jobs!
Good call for a Darwin Award.
However, I agree with the consensus on the NS Coal Export Pier modernization. You gotta sell coal wherever you can, and it makes sense to export it as efficently as possible.
$195 grand to sit on my butt for 31/2 months a year? Heck, I'll do it for $150 grand. Take me, Pleeeeze.
Gotta agree with JDKuehn on this one. It's met coal. You can own a whole bunch of assets and still make a buck exporting it.
Now, if only you could do ground storage there, then NS could make big bucks.
Too bad they are stuck with half the coal fleet sitting, full, waiting on ships and the newly modernized "rube goldberg" style dumper to empty cars into the ship, two at a time. Hopper cars are rather expensive coal storage devices. An the dumper has a whole lot of motion to it just to get the coal out of the car.
With ground storage, you could use rapid discharge hoppers, dump a whole train in minutes and then use a stacker/reclaimer to do the loading/blending.
But, you can't. sigh....
Darwin Awards? Geez, I could hours nominating things from work.
Sadly the GREED of Americans is what has/is killing America.
No clerical employee is worth that level of compensation and time off!
However, in our present state of legislative morass I would respectfully suggest that both Darwin Awards be given separately to the Majority Leader of the United States Senate and to the Speak of the House of Representatives.
Darwin studied and defined evolution within a confined conceptual understanding.
The named elected Representatives of the People have “achieved” a life form of stupidity never present within the known physical sciences… “You Can’t Fix Stupid”.
(Applicable to the west coast union and politicians equally.)
A lot of Clearfield coal still moves on a regular basis, 20 to 30 trains per month, to the PPL Strawberry Ridge plant over NS and the Nittany & Bald Eagle.
Pasadena Bound: No, the sky is not falling. Do you really think an employer is going to pay dockworkers and/or clerks such an obscene wage? I'd be willing to bet there is considerably more to this story than meets the eye. Greed is the human condition. We all want as much as we can get. Presumably, if the ILWU clerks can get the amount mentioned, someone has decided they are worth it. I've not heard of any of their employers going bankrupt and out of business.
There is a big difference between PRB and Applachian coal. PRB is cleaner (low sulphur) but has a lower BTU content than Applachian coal. Applachian coal can and is being cleaned up to mitigate emissions and offers a higher energy content. Also its far superior met properties means that App coal will be mined for years to come. App coal used for power generation is in the big market area for electricity, not in the middle of nothing far from the markets. There are several power plant at the mine mouth where transportation costs are non existant. I forsee a grand future for App coal once (and if) the current economic problems are solved. Now if we can just reign in the United Mine Workers.