http://www.chinadaily.com.cn/bizchina/2011-07/01/content_12817512.htm
Regular service starts today: 834 miles, 4hr 48 min., fare 555 yuan ( $85.76), built in 3 years, one year under schedule. Next stop: naysayers!
C&NW, CA&E, MILW, CGW and IC fan
In the 50's the US made the decision to invest in the Interstate system to enhance the transportation capabilities of the country.
In the 2000's China made the decision to invest in HSR to enhance the transportation capabilities of the country.
Different countries, different times, different decisions.
Never too old to have a happy childhood!
The decision made in the 50's for the Interstate system: are you implying that choice means we cannot therefore try something different 50+ years later, that we don't need any updates in our transportation system? In any case I think you will find China is also heavily investing in its own interstate system of highways. It really is not an either/or choice. Nor is the US so unique in its transportation needs.
And are we such blase followers of rail news that an 800 mile HSR doesn't register a peep of excitement, even if it is happening overseas? Not unless it's a CN bridge fire, somewhere or UP heritage locos.
Unfortunately, the politics of today can't envision tomorrow, let alone next year or next decade or half a century from now. While we built the Interstate system, it was built to standards for a 50 year life expectancy...that 50 years has come and gone and we are loath to invest the necessary funds to maintain or improve it.
The next quarter bottom line accounting cycle never supports long term capital investment opportunities and that has generated problems in the business community from where it originated...witness the exit of the heavy industry and manufacturing base of this country.
The arguments that are used against HSR are of the short sighted what kind of profit will it turn next quarter kind. Tomorrow is coming no matter how deeply we stick our heads in the sand.
schlimm The decision made in the 50's for the Interstate system: are you implying that choice means we cannot therefore try something different 50+ years later, that we don't need any updates in our transportation system? In any case I think you will find China is also heavily investing in its own interstate system of highways. It really is not an either/or choice. Nor is the US so unique in its transportation needs. And are we such blase followers of rail news that an 800 mile HSR doesn't register a peep of excitement, even if it is happening overseas? Not unless it's a CN bridge fire, somewhere or UP heritage locos.
BaltACD The next quarter bottom line accounting cycle never supports long term capital investment opportunities and that has generated problems in the business community from where it originated...witness the exit of the heavy industry and manufacturing base of this country. The arguments that are used against HSR are of the short sighted what kind of profit will it turn next quarter kind. Tomorrow is coming no matter how deeply we stick our heads in the sand.
You sure got that right. That "next quarter bottom line accounting cycle" may be, at least in part, a consequence of performance evaluations in the corporate world closely tied to promotions and compensation through stock option bonuses. So folks figured out quickly that to get ahead and get the big bonus, the long term success of your company was irrelevant. What mattered was the next year-end. The place where that philosophy is not prevalent has been in start ups, particularly tech and other newer technologies and concepts, where revenue is all reinvested salaries low, stock held privately, and the objective is long term growth. And those are the companies that have been responsible for most growth in our economy, while the established players focus on cost-cutting (cutting jobs and going overseas) as the main way to increase profits. Investments where the payoff is 5-10+ years forward are non-starters.
Well that should translate into NYP - CHI in 5 -1/2 Hrs including stops at PIT/CLE - TOL /. Now some one will bring up our HSR "gap". RE: Missle gap of 1960s - 1980s. But a lot cheaper??
schlimm You sure got that right. That "next quarter bottom line accounting cycle" may be, at least in part, a consequence of performance evaluations in the corporate world closely tied to promotions and compensation through stock option bonuses. So folks figured out quickly that to get ahead and get the big bonus, the long term success of your company was irrelevant. What mattered was the next year-end. The place where that philosophy is not prevalent has been in start ups, particularly tech and other newer technologies and concepts, where revenue is all reinvested salaries low, stock held privately, and the objective is long term growth. And those are the companies that have been responsible for most growth in our economy, while the established players focus on cost-cutting (cutting jobs and going overseas) as the main way to increase profits. Investments where the payoff is 5-10+ years forward are non-starters.
To believe this, and make this statement, you simiply have to deny reality.
The massive long term investments being made by the railroad industry prove it to be false. How anyone could know about the Sunset Route double tracking, the BNSF's double tracking of the Transcon, CSX's new intermodal facility at N. Baltimore, OH, CN's acquisistion of the EJ&E, etc. and say this is beyond comprehension.
These investments aren't going to pay off next quarter or even in two years. They are long term thinking. (Boeings new plant in South Carolina is another example of "Going Long".)
Heck Fire, if only the next quarter or the next two years was all that counted, nobody would ever buy a new locomotive - they don't pay off in two years.
I perceive this to be little more than sour grapes. If things don't go as you want you assign bad motives to the decision makers.
Sure, it's a generalization ("at least in part"). And sure, there are fine examples of "going long." But a person would have to be blind to not be aware of a trend toward the short term in corporate America over the past 30 years. Try to resist the ad hominem attacks.
schlimm Sure, it's a generalization ("at least in part"). And sure, there are fine examples of "going long." But a person would have to be blind to not be aware of a trend toward the short term in corporate America over the past 30 years. Try to resist the ad hominem attacks.
I've worked in Corporate America those past 30 years. I've never seen any company that I've worked for focus on the short term at the expense of the long view.
It is simply impossible for a US manufacturer (Abbott, Ford, Caterpillar, Boeing, etc.) to get anything more complex than a Hula Hoop to the market within two years. They've got to make the long term commitments. And they do. They make the long term investments in R&D, market research, plant, equipment, etc. and wait years and years for the hoped for payback.
Same thing with the railroads. The railroads have to fund track capacity expansion projects internally. They take the cash they earn and put it back in to the railroad. They do this because their analysis shows that, long term, investing in the extra capacity will pay for itself and then some. The short term maximization strategy, which you falsely claim drives things, would forego such investment in plant (and equipment) and simply auction existing capacity to the highest bidder. This short term approach would maximize earnings over that short term, but it wouldn't maximize the net present value for their owners. So a long term view is taken.
This "They only look at the short run" claim is simply a criticism leveled at decision makers who don't decide they way you want them to. They're not stupid, they're not "Greedy", and they are rational. They can be wrong (GM's Saturn), but they're rational.
Can you provided some examples specific to the railroad/transportaiton industry where a quest for short term gains have jeapordized the long term outlook?
And I ain't blind.
"sour grapes" and "if things don't go as you want you assign bad motives to the decision makers' are unwarranted attacks. I have had no stake in those decisions except through investments, so it is not personal to me with grudge holding, etc.
Apparently progress in passenger train service does not interest you, as it falls outside your area of involvement. I see no reason to respond to your irrelevant (to this thread) comments.
schlimm And are we such blase followers of rail news that an 800 mile HSR doesn't register a peep of excitement, even if it is happening overseas?
And are we such blase followers of rail news that an 800 mile HSR doesn't register a peep of excitement, even if it is happening overseas?
How is it that 50 years ago, and only 10 years after a huge war, the US could afford to build an entire interstate highway system, whereas today....
Let's see... we have 10% unemployment, many of them collecting government $ (luckily for them such a system exists); we also have an infrastructure that is well past it's prime....how about instead of paying folks to stay at home as their job marketability suffers, let's put that unemployment money to good use and rebuilt this country such that it once again becomes a respected world player.
That's what I thought they were going to do with the stimulus money, but pork won out over infrastructure.
Dave
Lackawanna Route of the Phoebe Snow
~40% apparently was used for tax cuts.
Well, China has the money and we don’t. So our failure to install sweeping new HSR is not just an event in a vacuum. It is just one tiny setback in an ocean of setbacks that are developing for us. The cause is the epic U.S. financial collapse that is now just beginning. Many are in denial about it because there is no way to measure the problem or the speed of its onset. There is no obvious endpoint to our financial resources, so it is easy to assume we will never reach it. And the empire of public spending marches forward, refusing to acknowledge that there is an endpoint.
I have seen some news about China heading for the same predicament. They are joined at the hip with the U.S. economy and our problems with it. Moreover, China is suffering a backlash for the financial mismanagement of their HSR expansion. It seems that when you throw a massive amount of money at a public project, a lot of that money goes elsewhere. So a substantial amount of boondoggle has crept into China’s new HSR, and it is adding its burden to the wider disconcerting economic picture of China.
So yes, we should learn from China about building new infrastructure. China’s HSR may indeed be a useful demonstration of what not to do, rather than something we should envy.
OK, put it in perspective then, not in a vacuum, as you say. Back in the day when America was moving towards greatness and building our transcontinentals, we had an enormous debt (the bloody and costly Civil War).
Public debt in 1860 totaled $64.8 million (the annual budget of the federal government at the time was $63.1 million). The war cost the nation $5.2 billion in direct expenditures, financed in a variety of ways so that the debt had skyrocketed to $2.2 billion by 1865. And the building and financing of those railroads over the next decade or two were hardly without enormous fraud and financial manipulations. But I guess if the cautions we hear today had been as rampant then as now, we would have done nothing. As another poster pointed out with the Interstates, some of the same environment prevailed then as well. So we do have choices, not just in HSR: risk and growth vs caution and stagnation and ultimately mediocrity.
Bucyrus Well, China has the money and we don’t. So our failure to install sweeping new HSR is not just an event in a vacuum. It is just one tiny setback in an ocean of setbacks that are developing for us. The cause is the epic U.S. financial collapse that is now just beginning. Many are in denial about it because there is no way to measure the problem or the speed of its onset. There is no obvious endpoint to our financial resources, so it is easy to assume we will never reach it. And the empire of public spending marches forward, refusing to acknowledge that there is an endpoint. I have seen some news about China heading for the same predicament. They are joined at the hip with the U.S. economy and our problems with it. Moreover, China is suffering a backlash for the financial mismanagement of their HSR expansion. It seems that when you throw a massive amount of money at a public project, a lot of that money goes elsewhere. So a substantial amount of boondoggle has crept into China’s new HSR, and it is adding its burden to the wider disconcerting economic picture of China. So yes, we should learn from China about building new infrastructure. China’s HSR may indeed be a useful demonstration of what not to do, rather than something we should envy.
Things simply cannot continue the way they are--something drastic is going to happen, somewhere, sometime, that will be the final straw that collapses the situation we are currently dealing with. I just hope that what happens is something good, although I'm not too optimistic about that. I don't want to imagine a world where the people look back on these times as the "good old days".
blue streak 1 Well that should translate into NYP - CHI in 5 -1/2 Hrs including stops at PIT/CLE - TOL /. Now some one will bring up our HSR "gap". RE: Missle gap of 1960s - 1980s. But a lot cheaper??
The 4hr 48 min run is with only one stop in Nanjing. Looking at the timetable it looks like there are 42 HSR trains each way per day just between Beijing and Shanghai (84 total). Some trains make as many as 7 intermediate stops, but adding only 42 minutes to the time. I guess that is an example of what henry6 and others call real passenger service.
schlimm OK, put it in perspective then, not in a vacuum, as you say. Back in the day when America was moving towards greatness and building our transcontinentals, we had an enormous debt (the bloody and costly Civil War). Public debt in 1860 totaled $64.8 million (the annual budget of the federal government at the time was $63.1 million). The war cost the nation $5.2 billion in direct expenditures, financed in a variety of ways so that the debt had skyrocketed to $2.2 billion by 1865. And the building and financing of those railroads over the next decade or two were hardly without enormous fraud and financial manipulations. But I guess if the cautions we hear today had been as rampant then as now, we would have done nothing. As another poster pointed out with the Interstates, some of the same environment prevailed then as well. So we do have choices, not just in HSR: risk and growth vs caution and stagnation and ultimately mediocrity.
At the end of the Civil War, as you point out, the public debt was slightly more than the annual federal budget. According to the U.S. Treasury, the amount of the public debt at the end of 1865 was $2.7 billion.
Thanks to very robust economic growth, by 1899 the public debt, which had been paid down to $1.99 billion, was undoubtedly a smaller percentage of GDP than had been the case at the close of the Civil War.
From 1869 to 1879 the US economy grew at an average annual real rate of 6.8%, according to Professor Milton Friedman, who was a Nobel prize winner in economics and a highly regarded economist. By the 1890s the U.S. economy had surpassed Great Britain's.
Growth rates and GDP numbers before 1929 must be treated with caution. Economists disagree on the exact figures. The Bureau of Economic Analysis' (BEA) on-line GDP numbers only go back to 1929. In other words, the historical data, depending on how far one goes back, is not as robust as the more recent data.
The U.S. economy following the Civil War was comparatively immature. It had a lot of room for growth and, therefore, was positioned nicely to manage a reasonably high public debt. The same was true following WWII, when the public debt was approximately 112% to 122% of GDP. However, the situation has changed.
The U.S. economy is mature and, therefore, is not likely to see the dramatic growth rates that it sustained in the decades following the Civil War and WWII. For example, from 2001 to 2010 the U.S. economy grew at an average annual nominal rate of 4.3%, but the real rate was only 1.68% according to the BEA. Relatively low economic growth rates suggest that the U.S. cannot hoist the relatively large public debt levels that it could service following the aforementioned wars.
The federal government helped fund the transcontinental railroads because it believed that it would recover its investment. And it did. Unfortunately, the proponents of high speed rail have not been able to convince anyone but themselves that an investment in high speed rail is likely to be paid for by the users. Equally damming is the fact that none of the projects have been able to attract private capital.
The U.S. is still the largest manufacturing country in the world. According to the National Association of Manufacturers, the U.S. share of world manufacturing in 2010 was just over 21%, which is about where it was in 1995. It has hovered around 20% of the world total since 1982. Manufacturing in the U.S. has increased every year since 1982, except for the recessionary years of 1990-91, 2000-01, and 2007-08.
The Japanese account for approximately 12% of the world's manufacturing, down from 21% in 1995. Chinese manufacturing represents 15% of the world total, up from approximately 4% in 1995.
The value of U.S. manufacturing grew from approximately $875 billion in 1995 to approximately $1.6 trillion in 2010. Taken alone U.S. manufacturing would be the 9th largest economy in the world.
I have withdrawn the NAM numbers regarding manufacturing employment and compensation. Unfortunately, several people missed the key point, i.e. the U.S. is still the largest manufacturing country in the world, and jumped on essentially irrelevant points.
Suffice it to say that the differences between the BLS statistics, which deal only with employment and the NAM numbers, are mostly a function of timing, categorization, location, and the statistical methodologies used by the BLS.
NKP guy Whenever I travel outside the USA, I notice how we are falling behind other countries in infrastructure. I would hope all of us know that not only are our transportation facilities inadequate for the future, but our water supply systems, sewer systems, school systems, etc., are slowly imploding by the day. For whatever reason, and we can argue about this until the cows come home, the USA is falling behind other countries in building the infrastructure modern, prosperous countries will need for the future. It just amazes me that China is now doing the kinds of "big things" we used to do. And it's not just China; did you see the new railroad station in Berlin? Here's my analogy: China (for one example) is playing to win. We want out of the game.
Presumably your conclusion regarding America's infrastructure is limited to personal observations. Where is the hard evidence? Comparative, verifable data?
Just because America has chosen not to build high speed rail systems to match those in Europe, Japan, or China does not mean that the country's infrastructure is inadequate or falling apart. There are, to be sure, areas that need to be improved. And they are being improved. ARRA, for example, has funded more than 11,000 road projects. And it has provided Amtrak with $1.3 billion for improvements, plus it has provided more than $8 billion for high speed rail.
I drive from my home in Georgetown, TX to Fort Myers, FL three or four times a year. Most of the trip is on the interstate highway system. And it is usually without incident. The highways are being improved where needed. In fact, significant portions of I-10 and I-75 have been or are being upgraded, i.e. more lanes, new bridges, etc.
Also, I fly out of Austin several times a year. The airports that I fly from or to are efficient and effective. I have never been gropped by the TSA nor intimated. In Austin I usually pass through airport security in less than five minutes.
Of course, my observations are as limited as yours. There is work to be done. But to say we are not in the game whilst China is playing to win is unsupported.
"The U.S. economy is mature and, therefore, is not likely to see the dramatic growth rates that it sustained in the decades following the Civil War and WWII. Relatively low economic growth rates suggest that the U.S. cannot hoist the relatively large public debt levels that it could service following the aforementioned wars."
So a mature economy cannot afford infrastructure improvement such as the Interstate system or HSR? Last I looked, Western Europe is considered a group of mature economies. Yet somehow, France, Germany etc, have been able to get the job done.
Interstates in TX may be ok; try some of the northern routes if you want to see infrastructure (roads and bridges, plus older structures, like water and sewer systems, needing work.
In 2008 approximately one in four rural bridges were deficient, while one in three urban bridges were deficient. The urban impact is quite significant given the higher level of passenger and freight traffic.
http://www.infrastructurereportcard.org/fact-sheet/bridges
Just last weekend, my 85 year old mother was groped by TSA as she sat in a wheel chair. She was mortified and highly offended. She says she is never going to fly again.
What disgusts me even more than TSA treating everyone like a criminal just in case is Americans who are so frightened that they tolerate it.
I guess the National Association of Manufacturers (the data Sam1 referred to) is using some very different numbers.
Referring to the BLS'S OCCUPATIONAL EMPLOYMENT AND WAGES -- MAY 2010, the numbers are rather different. Out of 127,097,160 employed in all occupations surveyed: Production occupations (their category for manufacturing) the number is 8,236,340, with a median hourly rate of $14.58 and a mean annual earnings of $33,770. This group is not even in the top 10 categories (by numbers of workers) of occupations in the US. "Of the 10 largest occupations, only registered nurses had an average wage above the U.S. all-occupations mean of $21.35 per hour or $44,410 annually."
May 2011 employment = 11,694,000. Average hourly earnings = $23.68, weekly hours average = 40.6. So annual earnings = $49993.22. All benefits in this category = 34.2% of total compensation, so total compensation = about $75K, which agrees with sam1's compensation figure. However, most people look at salaries and wages. Also, both BLS stats show much smaller numbers for manufacturing and production than the Nat. Assoc. of Manufacturers does. If you want to get really depressed, look at the entire report, and you will see some small sectors getting paid very well, and large numbers of workers paid pretty low wages.
http://www.bls.gov/news.release/ocwage.htm
NKP guy I feel sorry for our posterity: In debt up to their ears, and no tools to get themselves out. But their parents and grandparents kept starving the beast of government to death, while the major businesses (think GE) paid no taxes.
We are in debt up to our ears, but it is not from failing to build infrastructure. And it is certainly not because somebody starved the beast of government to death, as you say. That beast is alive and doing quite well thank you.
schlimm I guess the National Association of Manufacturers (the data Sam1 referred to) is using some very different numbers. Referring to the BLS'S OCCUPATIONAL EMPLOYMENT AND WAGES -- MAY 2010, the numbers are rather different. Out of 127,097,160 employed in all occupations surveyed: Production occupations (their category for manufacturing) the number is 8,236,340, with a median hourly rate of $14.58 and a mean annual earnings of $33,770. This group is not even in the top 10 categories (by numbers of workers) of occupations in the US. "Of the 10 largest occupations, only registered nurses had an average wage above the U.S. all-occupations mean of $21.35 per hour or $44,410 annually." Looking at it a little differently, the BLS has a category report for Manufacturing: NAICS 31-33, which includes higher-paid purchasing agents. May 2011 employment = 11,694,000. Average hourly earnings = $23.68, weekly hours average = 40.6. So annual earnings = $49993.22. All benefits in this category = 34.2% of total compensation, so total compensation = about $75K, which agrees with sam1's compensation figure. However, most people look at salaries and wages. Also, both BLS stats show much smaller numbers for manufacturing and production than the Nat. Assoc. of Manufacturers does. If you want to get really depressed, look at the entire report, and you will see some small sectors getting paid very well, and large numbers of workers paid pretty low wages. http://www.bls.gov/news.release/ocwage.htm
The National Association of Manufacturers is reporting U.S. manufacturing output (PPP sales revenues) as a per cent of world output. It is also reporting the average compensation package for employees engage in manufacturing, which is different from the BLS numbers, which report salaries and wages.
Contrary to your assertion, although many Americans may only focus on salaries and wages, in fact it is their total compensation package, i.e. payroll taxes, workers compensation taxes, healthcare benefits, retirement benefits, etc. that make up their compensation package. This is the amount that an employer incurs in employing a worker. It is the amount that hits the bottom line.
The key point, however, is once again lost. America is not out of the manufacturing business. Not by a long shot. And those who claim that it is simply don't know what they are talking about.
1. The BLS gives wages, salaries and benefits, and list both as percentages of total compensation. I think you will find, that most people, when inquiring about a job, look at salary, not total compensation, since most people are interesting in supporting themselves and family, and benefits don't do that.
2. The number of people employed in manufacturing according to the NAM site (18.6 mil.) is much higher than either BLS category: 11,694,000 (which includes purchasing agents) or 8,236,340. Folks can decide which stats they think are relevant. In some statistics, McDonald's and Burger King, et al. workers are categorized as being in manufacturing, because they "make" hamburgers and other fast foods.
schlimm "The U.S. economy is mature and, therefore, is not likely to see the dramatic growth rates that it sustained in the decades following the Civil War and WWII. Relatively low economic growth rates suggest that the U.S. cannot hoist the relatively large public debt levels that it could service following the aforementioned wars." So a mature economy cannot afford infrastructure improvement such as the Interstate system or HSR? Last I looked, Western Europe is considered a group of mature economies. Yet somehow, France, Germany etc, have been able to get the job done. Interstates in TX may be ok; try some of the northern routes if you want to see infrastructure (roads and bridges, plus older structures, like water and sewer systems, needing work.
The reference was made to your comments regarding the debt incurred during the Civil War. I did not say or imply that the U.S. did not have the resources to improve the interstate highway system or maintain its infrastructure. But it does not have the wiggle room that it had following the Civil War and WWII. In other words, when the economy was more robust, i.e. following the Civil War and WWII, the nation could take a bigger chance on projects that might not prove to be a wise investment. Moreover, as I pointed out, it invested in projects that had a reasonable probability of paying for themselves.
My objection to HSR is the low probability of the users paying for it. That is a different dynamic in a mature economy than a rapidly growing economy. As for the Europeans, they have more than their fair share of financial challenges. Frankly, I don't care what the Europeans do. This is not Europe. The solutions that might work there are not ones that would be a good fit in the United States.
Phoebe Vet In 2008 approximately one in four rural bridges were deficient, while one in three urban bridges were deficient. The urban impact is quite significant given the higher level of passenger and freight traffic. http://www.infrastructurereportcard.org/fact-sheet/bridges Just last weekend, my 85 year old mother was groped by TSA as she sat in a wheel chair. She was mortified and highly offended. She says she is never going to fly again. What disgusts me even more than TSA treating everyone like a criminal just in case is Americans who are so frightened that they tolerate it.
No one, certainly not this writer, is saying that portions of our infrastructure don't need to be repaired or replaced. Or that new infrastructure is not required. My counterpoint, however, is to some of the folks who post to these forums, claiming that the nation's infrastructure is falling apart. Bits and pieces of it are, to be sure, but overall the infrastructure of the United States is in reasonably decent shape.
The report that you cited claims that 26.9% of the nation's bridges are structurally deficient or functionally obsolete. It goes on to state that most of the bridges, whilst needing repair, are safe, although lower speeds and weights may be required in some instances. Functionally obsolete is like saying that my 2004 Toshiba laptop is obsolete. Yes, it is compared to a new Toshiba. But it works great for my purposes. I upgraded it. Just like a functionally obsolete bridge could be upgraded. Bridges are not the totality of infrastructure.
The report that you cite is hoisted by the American Society of Civil Engineers. They are likely to put a worst case scenario on the status of America's infrastructure. Jobs! Building, repairing, and replacing infrastructure means, amongst other things, jobs for civil engineers and technicians.
If a police officer monitors traffic, is he or she treating everyone like a criminal. The TSA, for very good reasons, is trying to keep criminals from blowing up airplanes because that is what they have done or attempted to do. I wish it were not so. But it is a threat. And I am glad the TSA is doing its job.
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