Our Analysis of the Draft National Freight Strategic Plan

National freight strategic planThe USDOT has submitted its new National Freight Strategic Plan for public comments. OnTrackNorthAmerica staff have read the document in full and appreciate the opportunity to contribute our thinking to the plan’s continued development.

The National Freight Strategic Plan (NFSP) aims to serve as an outline of key issues, but its lack of depth and overall passive orientation will not lead to meaningful progress. Increasing pressures from population growth and environmental degradation compel us to think more systemically and powerfully in advancing transportation’s vital role.

For issues as critical as freight transportation, we need to integrate well-meaning government efforts with intelligent private-sector business perspectives to create not just goals and visions, but action plans and commitments. As a matter of fact, if one were to consider a plan as a living document that includes specific measures, baselines, targets, accountabilities, commitments, and action steps, the National Freight Strategic Plan does not qualify as a “Plan”.

What we have come to accept as a “Plan”, including the NFSP, is more of a report on the past, plus trends and projections, and not a plan. In doing so, we abdicate responsibility for transportation system development to the commercial marketplace that is perfectly capable of creating individual projects, but not efficient systems. The entire NFSP relates to the future of goods movement as a pre-determined fate for which citizens must simply pay the economic, environmental, and social costs that the marketplace doesn’t include, because after all, everyone benefits.

This is not a strategy for national power and it is certainly not an approach that will deliver the urgent 21st-century policy goal of economic activity that supports sustainable growth and a higher quality of community life. OnTrackNorthAmerica is providing leadership on the three key developments that are critical to enhancing the NFSP’s contribution to achieving that goal. The first is to identify the full life-cycle costs and benefits of transportation investments at the individual project and systems’ level via OnTrackNorthAmerica’s Lifecycle Project. The second is to transform transportation reports and projections into Transportation Action Plans. The third is to implement a new innovative method for collective multi-stakeholder thinking, planning, and action, called IntelliConference.

So let’s dive into the NFSP to further illuminate the specific elements which need to be augmented or added.

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People are Naturally Community-Oriented

Collaboration Will Take Us Where Competition Can’t

by Michael Sussmanpeople_network-672x372

Across the world at any moment, on any given day, billions of people go about their business looking out for each other’s best interests. The world would not work as well as it does if that wasn’t true. Cooperation and thoughtfulness abound, while selfish, antagonistic acts pale in numbers.

“Are people inherently compassionate or self-centered?” has remained an oft-posed question because of the difference in impact between acts of cooperation or love and acts of aggression or thoughtlessness.

Hug someone today and the feeling of love can fade by tomorrow. You almost have to hug them over and over again, and we do. Shoot or knife someone, drive drunk and crash, or meanly criticize another person and the memory and consequence can last a lifetime. It is this severe and often lasting impact of violence and negativity that muddles our appreciation for the overwhelming amount of cooperation and consideration all around us.

So why did we orient the modern world’s commerce and governance on competition and mistrust, rather than cooperation and trust? What would have us think that we must pit individuals, companies, organizations, political parties, and countries in an endless competition for success?
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The (Only) Path to a World-Class Transportation System is to Design it Sustainably

by Michael Sussmanrail-cropped

Building productive transportation systems can only be accomplished by designing them sustainably. We can’t overcome unavoidable limits on clean air, stable climate, and land by just spending more money. Our new imperative must be moving freight while minimizing its impact on the environment, open space, highway capacity, and the overall costs of building and maintaining infrastructure. Given the differential between trucks and trains in the space they require for moving goods, the environmental impact of their relative fuel usage, and the efficiency of steel versus concrete and asphalt, it is critical that we shift into designing systems that optimize use of these two modes.

The market can only support this if business, government, and community cooperate. This can be accomplished by aligning around whole-system lifecycle measures and sustainable investment strategies.

Considering the pressures of increasing population on land use, transportation congestion, and the environment, three significant evolutions must occur: 1) include shorter supply chain options in planning, 2) ship as much as sensible by rail to benefit from its energy and space efficiency, and 3) proactively think and plan for reduced dependence on fossil fuels. Accomplishing these transformations must include win-win approaches that support existing transportation providers through this transition. Our existing truck, rail, water, and pipeline infrastructure is too vital to strand assets.
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It’s Time to Embrace Collaboration

By Michael Sussman

”Preserving competition in the marketplace,” by itself, is an incomplete regulatory principle that must be augmented with thoughtful collaboration if we are to produce an optimal, sustainable transportation system. When we saw the need for paving muddy roads to and from the railroads in the early 20th century, we missed the opportunity to thoughtfully integrate the newly developing freight highway system with the highly developed rail system. The resulting competition in commerce and public policy triggered a disastrous long-term shrinkage of the geographic footprint of the rail network leading to a suboptimal transportation system.

Coordinating across industries, companies, agencies, and indeed political parties requires respect, collaboration, and consensus-based decision-making processes. Our governing system, however, is structured to manage competing “factions” instead. Competition in the marketplace, competition for government attention, and competitive debate, rather than thoughtful deliberation, have stifled our collective ability to address the thornier issues of our day.
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Decreasing Transportation Impacts on Land Use and Environment in California

By Michael Sussman

In July, California Governor Jerry Brown signed Executive Order B-32-15 directing numerous state agencies to collaborate on and develop an “integrated action plan” by July 2016 that establishes clear targets to improve freight efficiency, transition to zero-emission technologies, and increase the competitiveness of California’s freight system. Caltrans and other state agencies have already solicited comments and are now fully engaged in the development of the action plan. OnTrackNorthAmerica’s intention is that the action plan implement strategies that better deploy freight rail’s economic and environmental benefits.

OnTrackNorthAmerica (OTNA) has been working throughout 2015 to contribute its expertise in freight transportation land use planning to the state’s progress. In light of the significant projected increases in the state’s freight traffic over the next 25 years, California must focus on the optimal integration of freight transportation and land use. Lower emission truck and locomotive engines alone will not be enough. Conserving highway capacity and road maintenance expenses requires an optimal modal balance between truck and rail modes.
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Revitalizing Direct Rail Service

As Featured in Railway Age, December 2014, Page 44


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Written by Michael Sussman, OnTrackNorthAmerica President and Founder

North America has yet to achieve the full extent of railroads’ potential contribution to the economy, environment, and land use. In spite of the good work of railroad developers, investors and staff, as well as significant public sector support, railroads remain underutilized for moving goods and people.

Our freight rail system is already so robust that it is easy to miss the possibility of a continental surge in capacity and reach. But railroads are energy-, capital-, and space-efficient, and these benefits are key to our future. It is time to get working on the rail system that a growing, modern society ultimately needs to be successful and sustainable.

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Reinventing the Wheel

Collaboration, Transportation, and Our Shared Future


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Michael Sussman, President and Founder

In 1995, I began studying the infrastructure investment strategies of industry, government, and society. Since then my company, Strategic Rail Finance has coordinated financing for railroad projects in 35 U.S. states. In 2007 I founded OnTrackNorthAmerica, a non-profit transportation policy and planning organization, to share what I have learned for society’s benefit.

What caught my attention in 1995 was the declining use of freight railroads and trains in favor of cars and trucks – despite the inherent energy, capital, and space efficiencies of rail transport. I wondered: why do we continue to invest the lion’s share of public and private capital toward less efficiency rather than more efficiency?

So I have devoted my business and non-profit organizations to turning around the economic principles that we have been relying on to advance major infrastructure systems.

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An Open Letter to Warren Buffett

pen_writingMr. Buffett, congratulations on your purchase of the BNSF Railway. It is a welcome investment in North America’s transportation system. It also provides a timely opening to address a systemic, long-standing problem—the incongruence between the inherent value of railroads to any well-functioning modern society and the shortfall in our investment of capital, energy, and land for rail freight and passenger transportation.

Only by understanding this shortcoming and seizing the opportunity to transform its causes can we bring North America out of its economic malaise and environmental jeopardy.

If we act wisely, your acquisition will become a watershed moment. However, to make the most of it, decision-making must evolve beyond moving money simply to where the investor receives the highest return on investment, and adopting a new principle that puts capital into industries and regions in a way that maximizes the benefit of those resources to those systems. From that shared benefit, investors receive their return.

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