It’s “beyond time” to modernize U.S. infrastructure, U.S. Chamber of Commerce urges

Lack of U.S. infrastructure modernization increasingly is causing expensive bottlenecks at ports, cities and elsewhere that are responsible for expensive delays in an increasingly complex worldwide market.

“I’ve been playing around with supply chain issues since I was a young man—which is a long time ago,” said 78-year-old Thomas J. Donohue, former head of the American Trucking Associations and for the past 20 years the president and CEO of the U.S. Chamber of Commerce.

“Today’s supply chain is not what I grew up with,” said Donohue. “Change is inevitable in this business.”

Donohue and others spoke during “Infrastructure Week” at the U.S. Chamber’s fifth annual Global Supply Chain Summit on May 17. Donohue says this is a “once in a generation” opportunity to modernize the U.S. infrastructure to the tune of $1 trillion in investment.

Ed Mortimer, executive director of the U.S. Chamber’s transportation initiative, has backed the Chamber’s call for a gradual increase in the federal fuels tax – currently 18.4 cents a gallon on gasoline, 24.4 cents on diesel, unchanged since 1993.

“It’s not just time to fix it,” Mortimer said. “It’s time to modernize it and improve it.”

Molly Campbell, a director at the Port Authority of New York and New Jersey, said “infrastructure is our bread and butter.” She said the port is undergoing a major dredging program to help accommodate larger, deeper ships.

“We would love to have infrastructure spending that is more flexible,” Campbell said. She said the government needs to invest in projects that make the most economic sense, not just merely on political will.

Bill Sullivan, the American Trucking Associations’ executive vice president of advocacy, said big investments are needed for the trucking industry. ATA officials recently met face to face with President Donald Trump and Vice President Mike Pence to lobby for more spending on highways.

Sullivan reiterated ATA’s call for an increase in the fuel tax—which, notably, he called “a user fee.” Trucking interests are vigorously opposed to tolling of existing highways, although Sullivan left the door open for tolls on newer highways.

“The highway is our office,” Sullivan said. “We believe there has to be sustainable funding mechanism to find dedicated funding” for highway investment.”

Sullivan said a recent freight bottleneck survey showed that congestion costs shippers $63 billion a year in delays.

Perhaps the United States could take a page from smaller countries such as Panama, which has invested mightily in infrastructure improvements.

Last year’s new, expanded Panama Canal is impacting worldwide trade, said Karla P. Gonzalez, deputy chief of mission at the Embassy of Panana. It can now accommodate ships with 14,000 TEUs, up from ships with 5,000 TEU limits.

“The East Coast ports are the most important beneficiaries of the Panama Canal expansion,” said Gonzalez, noting growth in ports of Virginia, Savannah and Jacksonville.

“I can’t place enough emphasis on the need for U.S. ports to modernize,” Gonzalez said, adding that ports in Baltimore and Miami recently have spent millions on improvements. “That same modernization needs to happen at other ports,” she said. “The ports have to be ready and there has to be spending to accommodate that.”

Those improvements at ports are welcome news to manufacturers, who have talked about being hampered by an aging U.S. infrastructure in an increasingly competitive worldwide market.

“We need infrastructure,” said Judith Marks, CEO of Siemens USA. “We need access. We need access to ports and airports. We are at a unique junction in this country to double down on infrastructure and double-down on public-private partnerships. We think of infrastructure with a capital I.”

That was music to the ears of Chamber officials, which have long backed a comprehensive infrastructure investment program. The Trump administration has talked about a $1 trillion investment for infrastructure, but so far details are sketchy.

But no question, the need for modernizing U.S. infrastructure is as great as ever. “We need a vibrant supply chain,” Marks of Siemen said.

“Supplies can only be sourced and shipped as quickly as the infrastructure allows,” U.S. Chamber of Commerce President and CEO Thomas J. Donohue said.    “It’s not just ports that are congested—it’s roads, bridges, intermodal connectors.”