Guest essay by Eric Worrall
Governor Gavin Newsom just signed an executive order suspending weight limits on trucks servicing Californian ports. But does this order address the real cause of the problem?
Governor Newsom Signs Executive Order to Help Tackle Supply Chain Issues
Published: Oct 20, 2021
Formalizes state agencies’ partnership with the Biden-Harris Administration’s efforts to address state, national and global supply chain challenges
Directs state agencies to develop longer-term proposals that support port operations and goods movement for consideration in the January 10 Governor’s Budget
SACRAMENTO – Amid global disruptions to the goods movement supply chain, Governor Gavin Newsom today signed an executive order directing state agencies to identify additional ways to alleviate congestion at California ports. The executive order builds on earlier efforts this year by the Governor’s Office of Business and Economic Development (GO-Biz) to ease supply chain issues by engaging the diverse network of stakeholders along the supply chain to discuss key challenges and identify short-term and long-term solutions. Record demand for imported goods combined with capacity issues across the entire supply chain have slowed distribution at ports on the California coast.
“California’s ports are critical to our local, state and national economies and the state is taking action to support goods movement in the face of global disruptions,” said Governor Newsom. “My administration will continue to work with federal, state, labor and industry partners on innovative solutions to tackle immediate challenges while also bringing our distribution processes into the 21st century.”
Today’s executive order directs state agencies to continue coordinating with the Biden-Harris Administration Supply Chain Disruptions Task Force to address state, national and global supply chain challenges. The executive order also directs the Department of Finance to work with state agencies to develop longer-term solutions that support port operations and goods movement for consideration in the January 10 Governor’s Budget, which may include port and transportation infrastructure improvements, electrification of the goods movement system from port to delivery, and workforce development.
Additionally, today’s executive order directs state agencies to identify state-owned properties and other locations that could be available to address short-term storage needs once goods are unloaded from ships; to identify priority freight routes to be considered for a temporary exemption to current gross vehicle limits to allow for trucks to carry additional goods; and to create workforce training and education programs. AB 639’s (Cervantes, 2020) implementation is also expedited through this executive order.
Earlier this year, GO-Biz launched the California Supply Chain Success Initiative, a partnership with the California State Transportation Agency, the Port of Long Beach, and the CSU Long Beach Center for International Trade and Transportation to engage the diverse network of stakeholders along the supply chain to discuss key challenges and identify creative solutions. This effort, which brought together federal, state and local leaders, is focused on both short-term and long-term steps to address port congestion, including implementing a new 24/7 environment across the supply chain, a move the state worked with the Biden-Harris Administration on, improving collaboration, and exploring policies to remove obstacles and improve the movement of goods.
A copy of the executive order signed today can be found here.
Source: https://www.gov.ca.gov/2021/10/20/governor-newsom-signs-executive-order-to-help-tackle-supply-chain-issues/
A week ago, a Facebook post by Don Helms, who owns North Idaho RV Rentals, triggered a social media storm when he blamed changes to labor laws and California’s strict environment laws for causing supply chain chaos.
So ships are piling up at Long Beach waiting to get unloaded. The port is jammed full of containers with no place to stack more. The liberal media is blaming it on the trucking industry while the nation’s store shelves are becoming bare… Well there’s more to the story. Could Gavin Newsom and California’s liberal trucking laws be the blame ?
The NEWS says the California port situation is caused by a driver shortage.
Not so fast: It is in part caused by a California Truck Ban which says all trucks must be 2011 or newer and a law called AB 5 which prohibits Owner Operators.
Traditionally the ports have been served by Owner Operators (non union). California has now banned Owner Operators.
Long term, truckers in California are not investing in new trucks because California has a law that makes them illegal in 2035. The requirement is to purchase electric trucks which do not exist.
And in the words of Paul Harvey, “Now you know the rest of the story”
BUSINESS
CARB to begin blocking certain trucks’ DMV registrations in 2020Carriers domiciled in California with trucks older than 2011 model, or using engines manufactured before 2010, will need to meet the Board’s new Truck and Bus Regulation beginning in 2020 or their vehicles will be blocked from registration with the state’s DMV, the state has said.
The new “health-based requirements” will need to be met before a driver is allowed to register his or her truck through the Department of Motor Vehicles, CARB says. A new enforcement tool used by the DMV beginning in 2020 will automatically block 2010 and older trucks from registration
Source: https://www.facebook.com/don.helms.92/posts/4716554968400743
Establishment media sources like USA Today were quick to pour scorn on the idea that emissions laws could be the cause of the USA’s widespread supply chain chaos, and insist that most of the trucks servicing California are already compliant with the new laws.
But Gavin Newsom’s latest executive order in my opinion to an extent undermines that denial. Liberating trucks to carry more freight will have a very similar effect to allowing a few more trucks to service Californian ports.
I don’t know whether Don Helms’ claims are correct, but you have to admit it would be very interesting to see whether the freight backlog could be cleared, if California Governor Gavin Newsom permanently cancelled all California specific restrictions and workplace rules which might affect trucks servicing major Californian ports.
Even if some of the rules have not been applied yet, the prospect of more red tape and higher costs would be enough to drive large numbers of truck drivers out of the Californian market. Why would any truck owner operator want to work in California, when the Newsom administration has repeatedly promised to shut their business down?
Of course I’m not expecting any genuine outbreak of common sense. A sensible environmental decision from California’s radical green administration, even in the face of a national emergency, seems as likely as the prospect of witnessing a flock of winged pigs take flight into the glorious setting sun.
California can be relied upon to do the right thing –
– after it has exhausted every other alternative…
I see no evidence to support the notion that California would ever do the right thing, even if every other option had been tried.
They will just order everyone to continue to do the wrong thing, but with more vigor.
The logic is similar to that highlighted in a recent CBC article. Their solution to the energy crisis precipitated in part by a significant decline in European renewable generation is, of course, to build more renewable generation.
More cowbell.
California will never ever d o the right thing .
All they are doing are left things.
(So paraphrasing Churchill won’t help)
This artificial crisis is being created on purpose to be used as pretext to implement new commie laws that pretend to help people out of the commie created misery with more communism.
The solution to every problem is more government.
Even those problems that were caused by government in the first place.
Sorry Leo, it has been well documented that we are decades if not centuries away from Peak Stupid, so not sure California can be relied on for anything rational for at least a few more lifetimes.
That might have been the case in the past, but there is no evidence that it continues to be so.
The problem always has been union control of the ports, they have crane operators that continually slow-walk the off loads so no one has to work too hard. The time to unload a container ship in Rotterdam is about 25-30% less than in Long Beach
In my research (see comment below) I found a survey article that ranked 150 container ports globally for efficiency. #1 and 2 were in China. Long Beach ranked #128, and LA ranked #132. Not a good look at all.
Leading from behind. Here’s to progress: one step forward, two steps backward. That said, NoJudgment, NoLabels, everything is perfectly congruent.
Governor DeSantis of Florida said Florida had the ability to handle the excess cargo and wants some of it sent Florida’s way. DeSantis says Florida ports have always operated on a 24-hour basis.
Very little automation compared to high ranking ports. Like so many other aspects in Kali, the ports are 3rd world quality
Union control — prb’ly like the “union” control on NY, NJ docks. In this case, it would be run by big boss Jose “Green Thumb” Sanchez.
There was a time when unions were needed to address some serious inequities but that time is long past. As soon as the union leaders got in bed with gangsters it was all over for the rank and file. Companies need employees and employees need jobs, it should be possible to work out everything fairly to both sides without resorting to oppositional behavior, strikes, and violence. It is a disgrace that American ports are ranked so low in efficiency.
“As soon as the union leaders got in bed with gangsters it was all over for the rank and file.”
The real problem is/was progressive politicians, who allowed the unions to systematically initiate coercive action against people and property in exchange for votes and contributions. Yes, the mob can be an issue, but the progressives keep an active eye on those they see as infringing on their turf.
“the mob can be an issue, but the progressives”
There’s a difference?
Well, maybe. I guess the mob is more ethical.
The belief that unions were once needed is nothing more than union propaganda.
The fact is that every problem unions claim to have solved, were either solved before the unions were formed, or were solved via government regulations.
Unions leaders for the most part, were the gangsters, from the very beginning.
Hmmmm…I have always suspected exactly that. It has long been a source of dispute in our home that if the unions all vanished overnight workers would be back to 12-hour days, zero-benefits, unsafe conditions, and every other bad thing you can imagine. Thanks MarkW!
Sure. Given all of the labor relation laws on the books. The unions came out of the gangs realizing that by controlling the clothing industry and then trucking, they controlled New York.
Unions are a paradox.
In a union? Bad working conditions? Then the union is clearly powerless to bring change, so why be a member?
In a union? Good working conditions? Then the union’s work here is done. What else is it going to do? Why be a member?
The power of the union is the threat to withhold labour via strike action. Unlike the Greta Cinematic Universe where a young student’s mind is apparently a powerful bargaining chip, in the real world a lack of labour can be very damaging to a company.
The problem is that this only really exists in periods of labour shortage where replacement labour is near impossible to obtain. When an economy is booming it becomes an employee market and if your job has poor working conditions, change jobs.
One might be tempted to say that Unions prefer employer market conditions where their members don’t have the option to quit and walk into a new job the next day…
I agree, based on many conversations I have had with union members over the years. Somehow they always ended up with the union member becoming incensed and having to be restrained from committing violence on my person. They tend to resent any suggestion that their union (family?) does not have their best interests at heart. The irrational reaction my queries inspire tend only to confirm my suspicions.
I have worked in mostly non-union jobs, but did have one experience working in a unionized job. Ironically, I was never treated more poorly as an employee as I was in my union job.
I needed no further confirmation that unions have long outlived their usefulness, if they ever had any.
I was reading the Emission-Compliant trucks pick up the cargo and travel to California’s border where non-compliant trucks await and the cargo is offloaded and reloaded onto the awaiting non-compliant trucks for transport throughout the USA. The problem is there aren’t sufficient ‘Compliant’ trucks in California serving the ports. A great metaphor here:
https://theconservativetreehouse.com/blog/2021/10/16/if-i-wasnt-blacklisted-on-twitter-i-would-share-this-to-help-people-understand-the-supply-chain-backlog/
That’s sort of happening, but geography presents a big problem. The Calif state line in mostly a line in the middle of nowhere. There is no place to drop containers to be picked up by another truck.
On I-10, there’s no significant truck terminal until you get to Phoenix. On I-40, nothing until Flagstaff and that one isn’t that big.
The railroads have their own issues: https://www.lloydsloadinglist.com/freight-directory/news/West-coast-ports-disrupted-as-rail-line-suspends-service/79526.htm#.YXJz4_rMIVA
No getting around it-California is a desert and a buffalo wallow at the same time. The state professes to be environmentally sound and prosperous while blocking as much business and as many workers as they can without bankrupting themselves.
Not even that. The Soviet Socialist State of California happily bankrupts itself, and then turns to the federal government to bail them out. That’s where most of the first Pandemic Relief Bill went.
The long shoreman’s union is a major factor in the very inefficient unloading, loading, and trucking operations at California’s major ports.
I’m starting to think a port in Mexico, just south of Yuma, AZ could be highly prosperous!
Also note that the Longshore Crane operators are working to rule, which means verrrry sloowwwly. Plus owner operators are not allowed to handle the overseas cargo. The list of doofus rulz goes on and on
Ron DeSantis (and I think Governer Abbot) have both offered ports in their state to relieve the pressure, but does that help any ship already at anchor off the coast of Californistan? Do they have enough fuel in their tanks to get to Florida? Probably not, but how are they going to get more fuel if they can’t even get into port? What’s the fee to use the Panama Canal? Ron DeSantis has offered incentive payments to ships that reroute from California, but is it enough to cover the fee to use the Panama Canal? And how big of a deal is it to reroute freight that’s already in transit? I hope that as many ships as possibly can take their cargo to Gulf of Mexico or Atlantic ports (anything not union controlled), but how many can?
Having their ships and cargo just sitting at anchor is pretty expensive as well.
There may not be much the ships currently stacked up can do, but the owners of those ships will remember this and will factor these delays into future decisions.
Many moons ago, they had ships called oilers, that could take fuel oil out to ships that weren’t docked. The military should still have such ships as well. Most of the surface fleet is not nuclear powered.
Didn’t Californistan ban all oilers?
You mean that you don’t have bunker barges, or oilers, any more? How do your cargo ships get refuelled then? Don’t tell me that they are refuelled by hundreds of trucks containing 40 tons of fuel each lining up on the dock side pumping fuel one at a time into the ships.Good grief, you deserve all the mayhem you are getting if that is the case.
I’m not involved in that industry so I don’t know.
I always thought that ships at dock would be refueled from big tanks onshore.
No, that would involve pipelines to every berth and a shut-down of cargo working whenever refuelling was going on. Normally a bunker barge ties up on the offshore side of the ship and pumps the fuel up a pipe coupled to the vessel’s fuel tanks.
Yes, there are indeed bunker barges at the ports of LA and Long Beach, I saw one just last week as I was taking a cruise vacation out of LA – San Pedro; the barge is towed to the starboard side of the ship while it was in the port channel. However, it wouldn’t seem feasible to maneuver that barge outside the breakwater to the 100-odd ships anchored from LA all the way south to Huntington Beach, and I didn’t see any oiler ships, so it may be the container ships must dock in the channel to be fueled.
Panama canal transit fees for a neo Panamax ship run around $400,000 to $450,000.
how can anyone justify that?
Bunker fuel for the transit of Cape Horn, plus time [= interest on capital debt; insurance; plus crew wages, food and leave pay accrued; plus consumables].
Auto
Noting that the USA [United States of America] doesn’t get the really big box boats [18-24 thousand TEU – Twenty foot Equivalent Unit], as their cranes are generally not big enough [height ,and outreach to reach boxes almost sixty metres (200 feet) from the quay wall].
And these ULCC Ultra Large Container Carriers] can’t get through even the recently enlarged Panama Canal.
It would probably be a good idea to start routing cargo to other ports besides the two California ports. The California ports are handling 40 percent of our nation’s cargo, and as we see, they are probably the most inefficient ports in the land. They are not even working on a 24-hour basis.
So It’s time to route the cargo around the California port roadblocks.
One can say with certainty that none of these regulations and laws are HELPING the situation, so it is not a large leap of faith to believe they are making things worse.
We need a Pacific facing state with some common sense to build out it’s port and shipping facilities for the future once California has driven away most of it’s business. Unfortunately, there are no Pacific facing states with any common sense.
This will force shipping to Canada or Mexico where it can be loaded onto trains and trucks.
“This will force shipping to Canada or Mexico where it can be loaded onto trains and trucks.” — which lengthens their delivery path — which increases their carbon footprint!
The left is always penny-wise and pound-foolish — or should that be: penny-foolish and pound-foolish!?
Are trucks domiciled outside of california also subject to the environmental rules?
Yes when operating in California.
Nope, a truck can do whatever it wants outside of California. But if they do not adhere to CA truck regulations, they are prohibited from operating within California. Even if domiciled outside the State.
Same with independent operators – they cannot operate in California unless they are a legally formed C corp or LLC, and are registered as a foreign corporation with the State of California (and thus liable to pay California income taxes on any and all earnings made inside the State of California – even if the payment is from a Texas company to your Florida LLC, if you did work in California to earn that payment, it is 100% taxable by California).
I think it’s even worse than that. I talked to a guy, resident of Texas (remember, they have no state income tax), said he once took a job in Arkansas, and while he worked it he stayed in hotels, commuting back home to Texas over the weekend. After a few months he decided the job wasn’t for him, he found another job in Texas and never set foot in Arkansas again that year. But, while employed in Arkansas, of course his paycheck had withholding for Arkansas income tax. So, come the end of the year, he filed an Arkansas income tax return to get that money back. Instead of getting a check, he got a letter saying, we notice your wife has not yet filed her Arkansas State income tax return! She had never set foot in the state of Arkansas, she did not have ANY income from anyone in Arkansas, but now they wanted to tax her income, too! I fear California is just as bad, anyone who does ANY business within the Soviet Socialist State of California, they want to take a bite of tax out of ALL the business they do, ANYWHERE!
That was probably just a form letter that was automatically mailed to anyone who did worked part time who met certain conditions.
When I started a new job in Arkansas a few years back, I moved in July, and my wife didn’t join me until February. I filed part year taxes for myself only, and I was never contacted about my wife’s income.
You still owe income taxes if you work in Arkansas, it doesn’t matter where you live. Also how would Arkansas know where his wife was working since they don’t have Texas tax records? California and NY are far worse; they will try to tax income from out of state even if you only work there part of the year.
One of the things I hated about driving the California highways was the speed limit for trucks and towed vehicles, 55 MPH. Cars are whizzing along at 70 or more and these trucks are creating moving roadblocks that are quite hazardous. I would be driving my monster truck hauling a 20′ trailer, perfectly capable of keeping up with auto traffic but legally required to plod along at 55. This has to affect the cost of goods traveling the roads as well.
Back before Jimmy Carter imposed his speed-limit-by-fiat of 55 mph nationwide the state of Texas had dual speed limits, in some places quad speed limits, autos day, autos night, trucks day, trucks night… Back then the state was run by Democrats. By the time the nationwide speed limit was lifted the state of Texas was controlled by Republicans. There are no dual speed limits. There may now be a line in the state law that says something about the posted speed limit is not automatically safe under all conditions and you may need to adjust your speed as local driving conditions warrant… or something like that, but there’s only one number on those signs by the side of the road.
A lot of Californians seem to think it is perfectly ok to allow the duel speed limit. Their thinking, as explained to me, is that truckers are less experienced drivers and need to be kept to a lower speed for the safety of others. I drove a lot of miles up and down the 5 hauling horses and always felt safer with the professional drivers as opposed to the non-pros….
Every state that I’m aware of has a “safe for conditions” rule on the books.
That is just common sense! Do you really need a law on the books making it against the law to drive too fast for conditions? Anyone who doesn’t have the brains to slow down when conditions are so rainy, foggy, snowy, icy, or smoky that visibility is impaired probably should not have a license to drive in the first place. And, yes, I am aware that the ranks of drivers are full of idiots who are ignorant of this simple safe behavior.
NC is similar with its 55-mph top limit on school buses. No concern about the hazard it creates having these vehicles blocking the 70mph traffic all around it.
I researched this two days ago.There are three parts to the California port supply chain bottleneck mess.
First, there is now a nationwide shortage of between 60,000 and 80,000 (depending on source) class 8 truckers with a CDL. So stuff isn’t moving, and about 80% of stuff goes by truck. Only about 20% is intermodal, and that still relays on drayage trucks.
Second, while it is true that new ‘anti gig, pro union’ law AB5 does ban owner-operators in CA, it is not presently a factor since the trucking industry got a preliminary injunction against enforcement while it fights the new law in federal court.
Third, and most damaging, is the CARB Diesel engine rule put in place in late 2020. It prohibits drayage tractors (class 8 trucks) with engines built before 2010.
Nationally, the average age of a drayage truck in 2018 was 12.8 years. Specific to Long Beach and Los Angeles ports, a 2012 survey showed that about 60% were older than ten years. That triangulates. So the new rule effectively removes about 60% of the available drayage truck capacity from California.
Biden’s deal to work the two ports 24/7 does nothing to address the real problem. It might get the container ships unloaded, but the containers will still be stuck in port. Shows how incompetent Biden is.
What’s the backlog at the Panama Canal these days? caused by CARB of course
The Panama Canal Authority (PCA) has announced its schedule for maintenance of the Panama Canal, with work commencing at the end of August. Delays are expected to run into weeks, not days, but the backlog is expected to push up spot rates.
Rud, your analysis is right on, as usual. The reason for banning truck motors older that 2010 was associated with a push toward electric trucks, which would be looney tunes writ large.
While zero emissions is the goal it isn’t currently BACT; so, CARB wants the cleanest heavy-duty engines in trucks operating on CA highways. 2010 model year was when strictest emissions limit for on-highway diesel engines was required. Year 2010 limits is when truck stops added DEF to their inventory. DEF is a high purity solution of urea & H2O. It is a reagent that by pyrolysis produces ammonia gas which reacts with NOX in a Selective Reduction Catalyst to convert NOX to N2 & H20. Before the SCR the exhaust passes through a Diesel Particulate Filter to remove particulate matter. These exhaust aftertreatment systems are expensive.
P.S. The SACAQMD & the ports of LA & Long Beach years ago set emissions standards for engines stricter than CARB’s; because the areas around the ports have low income residents who because of the heavy diesel truck traffic have very high lifetime exposure to TOXIC fine diesel particulates. The rational CARB used to adopt the 2020 2010 model year standard must have been based on a 10 year useful life of a on-highway diesel engine in commercial service.
There has never been any data supporting the belief that micro particles are a health hazard.
Note that while AB5 is under injunction, California’s Franchise Tax Board (our State IRS) has indicated that if they win, they will seek to retroactively tax anyone who violated AB5, even while under injunction.
You left out the part about the unions vehemently reject any and all automation. Too many things are still done by hand that could be much more efficiently and quickly done by a machine. That includes putting those containers on trucks. I fear that even if adequate trucks became available there would still be no increase in the through-put of containers, because the union workers would slow-walk the loading.
Re: your second – AB5 is under injunction
Under injunction or not, the expectation or potential for it to be implemented raises a new risk for those who either are considering getting into the owner/operator game or for those considering getting out of it sooner when situations allow (where they may have stayed in it longer). A law does not have to be fully enacted and enforced for it to have real effects on the decision making of those who might be effected.
…just as a vaccine mandate does not need to be in writing to cause a change in behavior by government employees, government contractors, and any company that gets intense scrutiny from the government, such as Big Tech, Big Pharma, Big Oil, Big Health Care, Big What-Have-You…
My sister-in-law is a buyer for one of the largest medical supply companies in the midwest and she’s got a huge problem: medical supplies have exipration dates. Many times the stuff expires in the non-environmentally stabilized (refirgerated) container before it even gets out of the storge yard. This really effects PPE.
“First, there is now a nationwide shortage of between 60,000 and 80,000 (depending on source) class 8 truckers with a CDL. So stuff isn’t moving, and about 80% of stuff goes by truck. Only about 20% is intermodal, and that still relays on drayage trucks.”
The U.S. military has transportation units specifically structured to move this cargo.
Biden should bring in the U.S. military and get these containers moving. We can’t wait until we get 60,000 new truck drivers trained and hired to move this cargo.
We need to get a modern-day “Red Ball Express” going, like was done in World War II.
https://www.nationalww2museum.org/war/articles/red-ball-express
“Only about 20% is intermodal, and that still relays on drayage trucks.”
That is factually incorrect. At the LA/Long Beach Container piers, out of 6 intermodal yards, there are 5 that are ‘On-Pier’ so no truck relaying is needed – they can be directly loaded.
“The Port of Los Angeles has America’s most extensive and modern network of on-dock and near-dock rail services connecting the U.S. imports and exports to international markets. About 35% of intermodal containers utilize the Port’s rail network, which includes one near-dock railyard and five on-dock railyards that serve the Port’s seven container terminals. The use of on-dock rail is growing annually.
The Port’s world-class rail infrastructure consists of more than 65 miles of on-dock track for building and sorting double-stack trains that speed imports to markets nationwide and U.S. products to the Port for delivery to consumers around the globe. The average train is made up of 30 double-stack cars, eliminating approximately 400 truck trips and related air pollution on each run while optimizing the movement of cargo.”
https://www.portoflosangeles.org/business/supply-chain/rail
But at the other end they require drayage to get to their destination warehouse in most cases.
the trucking industry got a preliminary injunction against enforcement
I was not aware of that, thank you.
I know 2 OTR drivers who have to pick up loads in AZ, NV, and OR because of Cali’s stupidity. Train operators are being punished, too. Democrat Party is actively killing America’s economy, not just in Cali, nationwide. Add to this the ever growing list of restrictions on drivers and who can be a driver.
Everything accelerating toward the “Big Reset”.
Enticing slackards by paying more for unemployment than they made while working, and even those who want to work the government(s), both federal and state, have put so many regulations and restrictions in the way as to make it damn near impossible.
The problem in a nutshell is — as you might expect — far more complicated than the simple, ‘we aren’t processing containers fast enough, and there isn’t dockside space to store them’.
OH SURE, that IS the easiest-to-see issue. Dockworkers who belong to unions, who really, really have a long quarrel (grievances) with operations-and-management which under ever quiver of the needle, regularly violate both the spirit and letter of the contracts the shipping companies have with the workers and their unions.
But seriously?
The driving factors must also include the much -harder-to-quantify loss of working capital that so many of the ultimate destination ‘customers’ have suffered in the COVID era. So, so many stores and operations working at well-under-normal product sales loads. For the last 20 months, many business went from robust and basically “healthy and not-at-risk” to rather despairingly unhealthy in a quiet politically suppressed sort of way. MANY businesses simply cannot take receipt of the container loads of stuff they ordered so long ago and now sitting quay-side because they cannot complete the remit-on-delivery financial transaction.
Some don’t want the products they once ordered, because they are egregiously late, or because business modeling has determined there isn’t consumer demand for the products. Some can’t take the containers because their warehouses are chock-full of unmoved product. Some because they are mass-warehouse intermediaries, who also can’t get the ultimate customers to accept the nominal consignments they house in their mega-warehouses.
This is, in the end, the wake-of-a-crisis that started 18+ months back, and because of the slow dynamics of the markets, is now coming to hatch.
Just as simply, teeny-tiny-things like “special chips now not being made any longer” is miring the transportation-on-land part of the picture. Trucks – big haulers – sitting by the thousands in GM’s production parking lots, waiting for the buck-twenty chip to get the things running. Or, tangentially, to get HVAC unit manufacture completed, or even higher-tech washing machines and home appliances. Every sector is affected by the chip-shortage.
But in the end, CAPITAL is now in crisis. Many firms have slowly eaten away at their working capital, and banks are resisting calls to loan them more, to pay for the containers and containers of shipments. Market-and-fiduciary sentiment has been growing ever more pessimistic about the outlook for the near future. A recession is FOR SURE on the horizon, and possibly a nasty depression. No bank would want to be beholding to an iffy company needing cash to complete transactions to receive containers of stuff that maybe they’d be unable to sell or utilize. Companies go bankrupt under those circumstances, and banks go DOWN with them, if invested.
What’s the Federal Government or a State Government to do? Ultimately, if as I propose, it really is a working-capital crisis at the core, then they could provide the hundreds-of-thousands of nominally useful businesses with capital loans. Get the product moving by getting it paid. But that in a way just squeezes the soapy water balloon into a different part of the consumer-chain fundamental problem. COVID has sapped our nations’ business sectors of much of their vitality. An that is a real, and basically externally incurable problem.
Lastly, the future. I think this all metastasizes (in keeping with a cancer’s simile) through the end of the year and without any significant external agency changing course, well into 2022 and 2023. The fundamentals remain deeply unaddressed. And with ever more urgent (and probably less necessary) para-governmental action to squash variants on COVID, the factors that have lead to the underlying problems, remain unmedicated.
-=GoatGuy=-
While I would not discount that there are Covid impacts, the idea that the backlog is because businesses don’t want the products they ordered some time ago does not square with the increasingly empty shelves we’re hearing about.
Inflation is a stubborn thing, both stopping it and starting it. I read a statistic the other day that included the figure 21% inflation, existing not speculated, on something… I think it was on business-business transactions. If that is the case, and as you can see consumers are seeing only 5.X% yet, that means the grocery store is getting offered inventory for a price higher than he can currently sell it. If Walmart is out right now, and he’s going to have to charge 20-25% more for the next batch he sells, but the grocery store down the street, who moves inventory slower and therefore still has some stock remaining at the old price, all the customers will run to the smaller grocery store. So Walmart isn’t going to restock until everyone in town runs out, so then they’re all charging the same price because they all paid the same price to restock. I have seen this in the face of rapidly rising gasoline prices, the Mom & Pop convenience store out on the country road has lower gas prices than the high-volume 100+ pump station over at the freeway, ’cause Mom & Pop bought their gas last week at a lower price than superstore on the freeway will have to pay to refill today.
As far as Wuhan flu, I told my wife the other day, Wuhan flu is so last year! It has a survivability about the same as the annual seasonal flu, so as an actual issue it no longer exists. If anyone wants any special treatment out of me, they have to come up with a better whine than that! Now the useless nonsensical restrictions put in place by the authoritarian states back at the beginning of this nonsense (and even then there was no scientific/data justification) are another thing entirely. Athoritarians don’t want to give up their authority.
If the Wuhan flu was so mild, why were hospitals overflowing with patients?
For many it is mild if your young with no health issues. I had Covid and the Delta variant and nearly friggin died from both. In my case I was suffocating. It damaged my lungs and it interfered with getting oxygen into cells. I’m old with health issues, so it depends on your situation.
When I’m not sick, I go out and mingle with masses of humanity and have since the pandemic started. I will not be a prisoner in my home. Life is a risk and you need to go out and take it. But if you are sick, please stay home for the consideration of those that are not.
A read an analysis, back when Congress began to debate the very first Pandemic Relief Bill (PRB), that shutting down the economy would result in a credit crisis. Before the lockdowns, many businesses would operate on 30 days payment. So a machine shop is asked to make a part, he can get the raw materials on his credit, make the part in a day or two and deliver it to his customer, who puts it into some bigger machine and/or apparatus and ships it to a retailer, or to a wholesaler who can usually move it to a retailer, it sells within a couple of days (or maybe it was ordered already on 10% down, or something, so pickup and payment are almost immediate) and gets paid, and then turns around and sends the cash back the other way, everyone gets paid, they pay down their credit lines and they’re all ready to make the next one, as long as they can get started on at least partial credit! But what if suddenly ALL credit becomes suspect? The machine shop can’t even get his raw materials to start making the part if his suppliers insist on cash on the barrelhead, and if you don’t have the cash, the materials don’t go out the door.
I am highly suspicious of turning to government to solve this problem that government created in the first place. Everything the government does it does poorly, so even if there’s a will to provide either federal or state assistance to guarantee those loans, how long will it take to write the legislation, get it passed, write the rules and/or regulations that will govern how it will all happen (create the necessary paperwork, IOW), and then each business will have to fill out the applications, submit and wait for a response…? I’m not optimistic that government “assistance” will do anything to actually solve the problem. And if government were to provide any useful assistance, it would have been in the first PRB, and with all of DC currently in the hands of the communists/socialists, anything worthwhile that could be done will get overwhelmingly buried in pork that no one wants or needs except for the crony capitalists that wrote the pork to become rich off OPM, no bill that can get passed will be written. End of story.
Thanks. We’re not going to get the real news anywhere else.
West coast ports are effectively owned and operated by unions and their paid political reps and Parties. Running off the owner operators is just an extension of that power, never mind the emissions caused by backlogged shipping offshore. Besides, it slows the import drag on Joe’s GDP numbers.
This looks very much like a stacked problem, where dealing with one layer will not solve the issue.
AB5 leads to a owner-operator ban.
CARB rules lead to a lack of trucks.
Longshoreman Union rules lead to a general slowdown.
This looks like an issue where dealing with only one layer will not solve the problem, so the special interests will claim that was not a problem fire all. This would take federal government action, but the odds of Granpa Gropes actually understanding the issues, or dealing with them, is rather less than pigs flying.
Moldering Joe hasn’t made a decision on his own in a couple of years. I fear it’s not just one person pulling his strings, it’s a committee, and government-by-committee is probably the only thing that could be worse than a government headed by a single incompetent (think Jimmy Carter).
It is simpler to use Biden as a synecdoche for the ruling junta, whomever they may be.Obama?
Wayne Allen Root says probably Obama, but behind Obama is Soros funding everything, but he’s not really the one in charge, either, behind him is the Chinese Communist Party.
According to the Virginia Democrat party, pointing out that Soros is funding a lot of these activities is a form of anti-semitism.
In the eyes of the democrats Any disrespect, dislike or noncompliance of the Democratic Ideology is either Anti-sematic or racist.
When it all goes belly up, and China takes over, things will change.
Not that most of us will like the new regime.
Where are the lawyers for NFIB and the US Chamber of Commerce when you need them?
The Fed just needs to follow CARB policy moves to understand U.S. inflation. They already made vehicles less reliable and more expensive. Now they are going after your store shelves with more inflation.
We have met the enemy and again it is California!
“We have met the enemy and he is us!” – Pogo
I miss Pogo….
Eight years of a Democratic President and Congress and the US will be just like California.
Looks to me like California is in restraint of trade.
It’s only illegal restraint of trade of they are slower than normal. This is the way they always have done it, so they’re still good (they think).
“Governor Gavin Newsom just signed an executive order suspending weight limits on trucks servicing Californian ports.”
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I don’t know all that much about container freight, but aren’t the containers loaded right from the start so they will meet weight restrictions for U.S. trucks?
I’d think that you’d want to load, ship, offload in US, truck to destination, and then the customer breaks down the container.
I suppose shared containers would go to a warehouse where the unrelated contents would be split up for distribution to multiple customers. But you’d still want the container to go right onto a truck with a weight compliant load.
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Why would any container be over weight? It just adds time and cost to split up a container’s load right at the port so trucks won’t be over their limit.
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That one has me stumped. Maybe it’s just a “See? We’re doing everything possible,” inclusion in the EO.
I think Newson knows that is useless, and is diverting from the real causes, CARB and the Union.
You are correct. Removing weight limits will do nothing in re container cargo loaded in Asia to meet US specs. Newsom is proved as incompetent as Biden.
Running overweight trucks is damaging to the highways too. So even if Newsom could somehow get around this it would be creating more problems for California’s highway system.
Not only damaging to roadways but unsafe to other motorists on the road.
It’s just an easy inconsequential act so he can say “Look I’m doing something” and subsequently shift any blame elsewhere.
I worked at a Freight Forwarder from 1987-2012 handling freight from Asia into the Port of LA/Long Beach. It was common to have containers arrive from China overloaded and/or with prohibitive/restrictive goods.
The weight limits also include restrictions per axle so I think the only effect will be on the trailers that can be used. Nice to see that regulations that are supposed to protect the safety of other drivers can be waived, but not regulations on plant food emissions.
Yes, we would use 3-axle chassis on overweight containers and get a permit for the route. We would do the same when containers arrived with 15 ft. of the load sticking out the back doors. In that case we would use a flatbed and get an overlength permit.
Question to politician: How can your proposed law help the problem?
If politician doesn’t change the subject and give the questioner propaganda about something totally different, the answer is usually along the line of
“Well, we have to do something!”
I don’t know if there’s one thing specifically causing the problem, I think it’s more likely that it’s a lot of different things, all caused by incompetence, stupidity and greed that have led to this situation.
Screw it, at this point I’m all for hitting rock bottom, the sooner we completely crash and burn the quicker we can rebuild w/o the nonsense.
Unfortunately rebuilding from scratch rarely works out. You only get one or two George Washingtons per millennia.
I’m with Bob on this one. One reason you only get that many Washingtons is equally the rarity of the situations from which they arise.
“If there must be trouble, let it be in my day, that my child may have peace”.
BOB-san:
WRONG! This transportation crisis (the worst in history) is totally caused by Longshore Unions and Leftist political hacks whose contracts prohibit ports from working 24/7, restrict the use of automation and robotics to speed container processing, expensive and mountainous loads ofEPA and municipal red tape that prevents proper port dredging, EPA emissions which prevent over 50% of US heavy-duty trucks from entering California, Union contracts that limit use of part-time longshoreman, Union rules that restrict non-Union truckers from entering port facilities, and many other insane reasons.
The are and many other reasons why US ports are some of the slowest in the world for speed and efficiency which is why most US ports are ranked in the 300’s compared to other international ports… It’s embarrassing.
Leftists political hacks and Union rules have utterly destroyed the US economy…
Florida and Texas are offering their ports. There aren’t nearly as many restrictions on getting things done there, as there are in California.
Bypass California and bypass the California restrictions.
Tom-san:
The huge container vessels stranded off California are too large for the Panama Canal, so it’s not a viable to bypass the California cesspool…
it’s possible for Asia shipments to go via Suez Canal to the US East Coast, but the transit time is 65 days vs 12 days from Asia to Cali.
Regardless, US Gulf Coast ports and Eastern Ports are still under Union contracts, so they’re only marginally better..
I guess we’ll have to use the ice-free Arctic to move container ships….oh wait.
More unintended consequences. CA thought they could force the trucking industry to comply with unrealistic laws, used the unions against their own members and independent truckers, and now are suffering from their decisions. All of this supposedly to be “the leader in Climate Change”. This is what happens when virtue signaling becomes real.
Climate regulations dreamed up by those who haven’t a clue. Feels good to have power.
Well the congestion at the ports has to be a land transport problem. Simple really. The ships are there waiting for discharge and the shops around the country have empty shelves.
So there is something wrong with the land transport AKA trucks and perhaps rail.
So I read above that owner drivers are subject to a “law called AB 5 which prohibits Owner Operators.”
This is a big hole for a start.
Next I read – Long term, truckers in California are not investing in new trucks because California has a law that makes them illegal in 2035. The requirement is to purchase electric trucks which do not exist.
And then Blocking certain trucks’ DMV registrations in 2020
And not to mention – Carriers domiciled in California with trucks older than 2011 model, or using engines manufactured before 2010, will need to meet the Board’s new Truck and Bus Regulation beginning in 2020 or their vehicles will be blocked from registration with the state’s DMV
The new “health-based requirements” will need to be met before a driver is allowed to register his or her truck through the Department of Motor Vehicles, CARB says. A new enforcement tool used by the DMV beginning in 2020 will automatically block 2010 and older trucks from registration.
These seem a pretty good reason for all the problems at the retail and shipping problems.
Well the people of California have been either been hoodwinked with the effort to get rid of Newsom, just quite happy with the status quo, simply dont understand what is happening.
or are on their way to Texas!
Newsom is the typical idiot who would not be able to admit his stupidity or is there some other reason?
Not in most cases. A truck can generally only carry one container, so a higher weight limit doesn’t improve throughput for containers already packed to comply with the original limit. You would have to unload and repack containers with more stuff to take advantage of the higher limit, and that process would cause even more delay. The containers would have to be loaded to the higher limit at the port of origin, so any possible relief for containerized cargo is weeks away (transit from Shanghai to Los Angeles is over 19 days).
It also doesn’t help for cargo passing through California destined for other states, unless they also increase their allowed maximum weights.
It is far, far better to have more trucks.
How about allowing Australian style road-trains?
Beneficial side effect: Let’s go Brandon is increasing.
Nothing in life is simple, or as simple as people with an ax to grind want to make it sound like.
There is clearly a nationwide truck driver shortage. I see it every day here in Florida where I am managing a large construction project and we can never get enough truck drivers. There is a shortage of all kinds of labor in every segment of our economy – everybody I know in ever business I deal with is singing the same sad song of nearly impossible to get workers.
But that is not the only cause of the supply chain issue in California. Clearly CA is a very restrictive state due to their only in the nation environmental laws. Those laws clearly hae consequences, and they are exacerbating the already difficult supply chain problem.
I will note that lots of those ships that have been anchored for weeks or months outside the Port of Los Angeles are now weighing anchor, cruising over to Panama and the canal, and making for not-so backed up ports here on the east and Gulf Coasts of the US where we don’t have CA’s overweaning enviromental constraints to deal with .. that fact alone is telling. If the entire problem were global and not worse in CA, then why are the ships voting with their hulls to go elsewhere?
CARB rules the world and drives it to ruin.
An interesting followup. Union Pacific is one of two,railroads handling most of the intermodal container freight from Long Beach and LA. They moved their operation to 24/7 to support the pots move. They had almost no increase in loading. They announced today (Thursday) that the problem is lack of drayage trucks to move the containers from the port to their railhead. So the underlying cause is CARB, and Biden’s 24/7 solution is useless. Confirmed by a major player.
“An interesting followup. Union Pacific is one of two,railroads handling most of the intermodal container freight from Long Beach and LA. They moved their operation to 24/7 to support the pots move. They had almost no increase in loading.”
Isn’t this pitiful !
Apparently, moving cargo is not the top priority of those operating the port.
Biden needs to get the transportation battalions in the U.S. military to move the cargo to the Union Pacific’s loading facilities.
The railroads are reportedly increasing the length of their trains in order to move more cargo.
Hi Folks…..have you heard of ‘Just in Time’ inventory? The morons at the MBA programs came up with that strategy.
Get rid of MBA programs and you’ll have a better functioning economy. Notice that they don’t
have these port issues in the rest of the world.
Oh…heavier trucks mean….more damage to our highways…..
Just in time saves companies a lot of money.
Grocery stores don’t use just in time, but they are also having problems with empty shelves.
Most of the world uses just in time.
I remember “Just in Time” and “Inventory is Evil” and don’t forget “ISO 900”
Just in time turned out to be just to late, and Inventory is evil was the reason, and ISO 9000 meant you could make junk, but it was certified junk.
peter,
Just-in-time works fine most of the time, unless it runs into walls and barriers put up by state and federal governments! The walls against productivity put up by Commifornia are blocking goods from moving across the country, and coupled with the lack of concern from the port workers unions means that this will be a long term problem!
I wish there was ANYONE in the Bai Den Regime who was capable of fixing this situation, but the odds are that everything they try will make matters worse! Get ready for a rough patch in the voyage; the ship of state is being run onto the rocks; and whether it is intentional or not this incompetent crew must be relieved of duty!
The chance of Zhao Bai Den and Gov. Nuisance fixing this is about as good as Eric’s hope for pigs flying off into the sunset..singing!
WTF? Maybe this an opening for Amazon to completely take over the entire country
Amazon has ordered 100,000 new electric delivery trucks from Rivian. Obviously, they plan to compete with USPS, UPS, FedEx, etc
https://insideevs.com/news/371826/amazon-electric-delivery-trucks-rivian/
For local delivery, yes. But there is no way that Amazon is going to move large containers from Long Beach to Chicago or Atlanta. And certainly not with electric trucks that cannot be recharged along the way. Once products get delivered to their local hubs they can then deliver it with those trucks, which can be recharged overnight.
Much of the pile up has to do with the empty containers sitting in the way and those that cannot be off loaded from chassis because there is place to put them. I read a couple of stories in the business papers a month or two ago, can’t locate them today, that China will not take them back. It is cheaper for China to build new than pay for processing and transit the used containers back. The containers sitting in the way are scrap metal. Doing a quick search this morning showed that a new container made in China cost $2-3000 US.
“It is cheaper for China to build new than pay for processing and transit the used containers back.”
That’s interesting. The market makes adjustments.
They should take those unused containers and turn them into little houses for the California homeless.
I’ve seen a number of houses that have been made from shipping containers.
Sounds like a business opportunity.
I’ve actually seen some pretty good house designs using shipping containers. The ones I saw used more than one container and combined them in interesting ways.
I remember somebody doing that somewhere, and then a bunch of activists complained about how “homeless people are being forced to live in storage containers”
There are actually people with money who choose to live in storage container homes. It makes them think they are saving the world.
I’ve seen several designs and they’ve even been featured in some of my magazines. There’s a lot you can do with them. But activists need something to whine about, right?
Here is another perspective on the empty container problem, I read this thread (link below) on Twitter this morning from a man named Ryan Petersen, describing a recent tour that he conducted at the ports of LA and Long Beach to look at the problem. A significant reason he discovered is restrictive regulations of the local cities in LA region that prohibit using available space outside the port terminals to offload the empty containers and free up the trucks to go pick up more full loads. He writes of many other issues, but there seem to be numerous choke points that are created by government policies.
[Edited to replace twitter thread with unrolled version]
https://threadreaderapp.com/thread/1451543776992845834.html
“but there seem to be numerous choke points that are created by government policies.”
Yes, I think this is the common theme at the California ports.
Apparently, after the Ryan Petersen thread went viral, the mayor of Long Beach suddenly signed an executive order to allow truck terminals outside the LA/LB ports to stack up to 4 or 6 containers high.
Must be an election next year ☺
Blame Government, Not COVID-19, for Supply Chain Collapse
Peter St. Onge / @profstonge / October 15, 2021
https://www.dailysignal.com/2021/10/15/blame-government-not-covid-19-for-supply-chain-collapse/
California truckers, in particular, have been socked by the state’s notorious AB 5 law restricting gig workers and independent contractors, combined with truck emission mandates introduced just last year that can mean tens of thousands of dollars out of pocket.
International Longshore/Warehouse Union
Party of Recipients
Democrats $171,42397 98%
Others $3,649 2%
Republicans $0 0%
https://www.opensecrets.org/orgs/international-longshore-warehouse-union/recipients?id=D000044926
Weight limits on trucks are established for two reasons, both which affect transportation safety. One reason is to prevent trucks from self destructing and the other is to prevent roads from self destructing.
So it is now apparent that Gavin Newsom does not support safety in transportation as he has suspended safety regulations in order to help the Chinese.
There is no relation between the age and emissions status of a truck and regulation on how much it can carry. And really, how many 10 year old trucks were there out there?
As stated above, griff, about 60% of all trucks. Most class 8 tractors will last close to 1,000,000 miles, with an engine overhaul along the way. They average 60,000 miles/year. You do the math.
10 years is usually less than half the lifetime of those trucks try doing 5 minutes worth of research on non-propaganda sites and you could know that.
As the former head of marketing for Navistar (the 9600 was my baby), a few clarifications. An OTR long haul class 8 typically runs for about 5 years or 400k miles. The engine is overhauled, and then it is converted to regional (2 day runs) or short haul(day runs). Fewer miles per year, lasts another 10-15 years depending on where (winter salt corrosion). Drayage trucks running to /from intermodal terminals are all short haul old trucks. That is certainly 100% the case for the Chicago intermodal yards, where Navistar is based. Long Beach and LA would be a mix, but as estimated above the CARB rule probably cut CA drayage capacity about 60% in 2021.
The worst transportation crisis in world history is being caused by Union contracts and enviro-wackos:
1) California’s new heavy-duty truck emission standards prohibit over 50% of the US truck fleet from entering California.
2) Union contracts prohibit ports from being open 24/7, which is why US ports are rated in the 300’s in the world for container processing times.
3) Union contracts greatly restrict time-saving automation and robotics to minimize Union worker cuts and maximize Union membership rolls.
4) Some ports demand only Teamster Union truck drivers can remove containers from port terminals.
5) Since AVERAGE longshoreman Union make $170,000/year part-time non-unions members are kept to a minimum.
6) Although Unions have allowed the 24/7 ban to be temporarily lifted, only some piers in ports are doing so and most piers are still only working 16/7. (Funny how they leave that detail out…)
7) Although some piers are now working 24/7, not all port Custom’s offices or container yard terminals are, so it’s not really helping.
8) EPA rules regarding dredging are so time consuming and expensive, US ports’ ship lanes are very narrow and shallow so it takes too long for amazingly skillful pilots to take vessels in and out of port.
9) There is a shortage of about 50,000 truck drivers with no takers because far too many Americans are willing to live off welfare than to work..
Trucking is a very tough job that “only” pays about $50,000/year often less, so with excessive welfare benefits, why work. 20 million workers have left the workforce since April of this year, which is crazy..
i could go on and on at how chaotic and inefficient US ports are, but you get the picture…. It’s insane the second largest importer/exporter in the world has ports ranked in the 300’s against other international trading ports. BTW, NYC is US’ most efficient port ranked around 90th in the world in efficiency..sad..
Biden needs declare a state of emergency and get all piers in all major ports, all Custom’s, and all container yards working 24/7, port authorities must be forced to hire as many part-time non-Union longshoreman as required to handle the increased work load, and any Union member who threatens to strike will be fired, the new EPA heavy-duty restrictions must be suspended, any new full-time trucker that’s employed during the state of emergency will not have to pay any federal incomes taxes for 3 years.
This insane self-created USN transportation crisis is costing the world and US economies $trillions.
What a mess….
Well, Obama once said we shouldn’t underestimate Biden’s ability to screw things up.
Biden has screwed up everything he has touched so far.
Ya’ll come to free ports in TX and FL and skip CA robbery.
That’s what the Director of Florida’s ports said this morning on tv. They are ready to go to work.
If a shortage of drayage capacity is a major issue, then an adjustment of weight limits will likely make very little difference. These cargos are containerized and leave Asia loaded to weights which were optimized for the drayage systems in use at the respective destination ports. Changing the weight limits after the containers sit on a ship achored at their destination will do nothing to expedite the transfer of those containers.
I see a great business opportunity for someone to start a truly horse powered eco friendly way of getting goods about. The people of the Loony State will also be known for growing the best roses in the world or end up knee deep in horse s**t but they should be used to it as their political elite masters have been talking it for years! Just think of it long trains of horse drawn wagons stretching for as far as you can see carrying a fraction of the load that those bad smelly trucks once did.
James Bull
The central planning of socialism will always get results and the results are what is happening with the supply chain. And self interest is always a prime factor in their planning.
There is/was a backlog/slowdown of intermodal train service between South California & Chicago. This story from back in July…can’t imagine it has gotten any better.
BNSF metering space on LA-Chicago intermodal trains
https://www.joc.com/rail-intermodal/class-i-railroads/bnsf-railway/bnsf-metering-space-la-chicago-intermodal-trains_20210719.html
Yes. My second home is in Chicagoland and the intermodal yards there have backed up the whole country. A complicated mess of problems including not enough long sidings, not enough highway capacity as volumes have built over time, not enough automation (unions)…
The railroads could probably use a little bit more efficiency.
I worked for a 1500-person railroad company, the Katy Railroad, and then the Union Pacific Railroad, a 15,000-person railroad company, bought out the Katy, and I worked for the UP for several years, and the Katy Railroad could run circles around the UP Railroad when it came to moving cargo.
The Katy Railroad moved more rail traffic than any single-track railroad west of the Mississippi, and there was only one small railroad up east that was more efficient. The Katy Railroad was featured in an publication called “Trains” around 1984.
I was working the night the UP took over control of the Katy.
Normally, I would run about 10 trains through our terminal in an 8-hour shift.
The night the UP took over, a train came into town at the beginning of my shift, pulled up to the depot and stopped, and didn’t move again during my entire shift. No trains went through our terminal that night.
The reason? The UP couldn’t figure out how to call the train crews.
That was usually one of my jobs, but the UP moved this calling up to Omaha, and they just couldn’t get it together. It was a pathetic demonstration of how a bloated 15,000-person bureaucracy can screw things up because the left hand doesn’t talk to the right hand.
I could have called those crews in five minutes. In fact, those crews were calling me to see when they were going to get out and I couldn’t tell them because I had no control over the call. It had to come from Omaha. And it didn’t come all night. That was a harbinger of things to come.
I don’t imagine the UP has gotten any more efficient today than then.
I could have saved the UP millions of dollars if they had listened to me. I saw numerous occasions where a train would come through town and have an extra engine on it that was not listed on the manifest.
I called the Chief Dispatcher of the Union Pacific railroad the first time I spotted this problem, and he, at first was skeptical that the train had an extra engine on it because his computer showed the engine as being parked somewhere in New Mexico. But I assured him that the engine had just passed by my window in Oklahoma. He thanked me, but didn’t ask me to keep my eyes open for similar problems and report to him. He didn’t act like he was interested. So I didn’t report any more of the problems I saw to him. Why bother? I did report the problems to the Katy Chief Dispatcher, who was a good guy and actually listened. I let him deal with the UP Chief after that.
The UP didn’t know where many of their engines were located! The Katy Railroad knew the locstion of every engine they had. I could call the president of the Katy Railroad on the phone. I couldn’t call the president of the UP railroad unless I went through about 10 layers of bureaucracy.
That tends to stifle innovation and efficiency.
The UP would have been better off buying the Katy and then just allow it to run as normal without interference from the UP. But bureaucrats are compelled to stick their noses in places they don’t belong.
All the Katy people that tranferred to Omaha were amazed at how inefficient this big operation really was. The Katy people were used to getting things done, but that changed when they changed jobs and went to the UP.
…and now, this (it’s not just an LA/Long Beach issue): Now US intermodal rail yards clog up as port congestion and delays continue
https://theloadstar.com/now-us-intermodal-rail-yards-clog-up-as-port-congestion-and-delays-continue/
I also heard some anecdotal reports that emissions limits on trucks might be part of the cause of the blockage of the ports in California. I frequently see large, powerful trucks in Utah that can pull two or three trailers (containers) hitched together at once, which probably reduces the emission rate per ton-mile transported.
If California limits the gross weight of trucks that can cross the state, the trucks that arrive at the port can probably only load one container at a time to haul it across California. Truckers that use the more powerful trucks that can haul two or three containers can no longer use them in California, or would have to unhitch the extra trailers at the border with Nevada, Arizona, or Oregon. There is not much infrastructure at the highway crossings of these state borders (most of which are sparsely populated) to allow safe storage and parking of loaded trailers, without the risk of stolen merchandise.
It’s very possible that regulations against CO2 emissions are partly responsible for the backlog at the California ports. What’s more, these regulations actually serve to INCREASE CO2 emissions. A truck engine will consume more than one-third of the fuel consumed to haul three trailers when it only hauls one trailer, but since it would then have to make three trips, the total fuel consumed for three trailers would be higher for three trips hauling one trailer than for one trip hauling three trailers. So, for the same weight of merchandise hauled over the same distance, more fuel consumption and more CO2 emissions using lightly loaded trucks.
Then again, Gavin Newsom was never known for his IQ.
I don’t know about the emissions laws but I can definitely see AB5 having an impact – that would directly cause driver shortages.
I hear it’s being considered to be enacted at a national level.
Uncle Joe and CARB own this one too.
This would be a great time for the Governors of TX and FL to offer incentives to truckers to turn away from California and vote with their trucks.
Here is how the Biden Administration has handled all the various crises since January 20: Afghanistan fiasco, Border disaster, transportation crisis, violent crime crisis, economic crisis, monetary crisis, inflation crisis, energy crisis, gas crisis, food crisis, 12 million unfilled jobs crisis, etc:
(click to play)
https://youtu.be/6Orde7FtHh0?t=61
Better route the trucks through Mexico and Panama since the west coast is lost to the dark lords of CARB.
Union anecdote as told by the victim: Years ago I was an outside salesman of computers, calling on small businesses in a 30 mile radius of the home office. My income was based on straight commission, with no base salary – sell or starve. So, I hustled as much as I could.
On one occasion I received an order for a large PC and printer for a crane construction outfit that I regularly called on. Keep in mind, PC’s used to be huge, and the separate CRT monitor was often heavier than the main box. The printer they ordered was also large, meant for printing out reams of reports.
Well, I carried all three boxes in from my car to the main reception area, reporting to the receptionist. She told me I couldn’t carry the boxes any farther – “Trades” would have to take it from here. I waited over half an hour before two dudes came ambling up.
They looked over the order, opened up THE DOOR I WAS SITTING NEXT TO, and moved my three boxes from the reception area into that office. I had no idea that that room, just off the reception area, was where my order would land! They moved my boxes no more than ten feet from where I set them down on arrival and then ambled away. I could’ve set that equipment up, printed out a test page, and driven back to my home office in the time it took for those two guys to show up.
I have no doubt the receptionist knew where the boxes were going. She let me sit there for half an hour, waiting for trades to get around to stopping by. You will probably be shocked to hear that crane manufacturer went out of business years ago.
Washington Post says to stop complaining and just lower your expectations: https://twitter.com/washingtonpost/status/1450410755698958337
As a strategic alternative, reduce imports from China, support manufacturing in Mexico.
Stinchfield on Newsmax just showed that the Chinese leased port in Los Angeles is slow rolling trucks out of that Los Angeles terminal.
Meanwhile privately leased terminals are packing trucks thru at a rate of 35 packing the four lanes on the way out all day long!
So, China is also at war with the USA.
It’s just a non-bullet, non-bomb style of war.
Newsome is not helping, but what we see at non-Chinese leased terminals is lots of movement, pollution rules or not.
“So, China is also at war with the USA.
It’s just a non-bullet, non-bomb style of war.”
Yes, they have been at war with the U.S. for years. They don’t want to just get along, they want to dominate. And they are undermining the U.S. at every opportunity in pursuit of that goal. Pretty soon their fishing fleet will be fishing in San Franciso bay.
Occupied California should not be able to hold the nation hostage.
Time for Texas, Florida, and other biz friendly states to build ports!!! Tell commiefornia to ram it
I did a little digging into this. From what I found, the backup started around the same time that the CARB change was implemented. I checked out that CARB dictate, didn’t see anything in it that indicated older trucks wouldn’t be allowed to ride the roads…
Will have to read thru these comments.