National Transportation Bill Offers Prospect for Environmental and Job Benefits in 2010

As advocates for clean energy and good jobs evaluate opportunities to advance their issues in 2010—from a jobs bill that could include energy efficiency and clean energy investments to a federal clean energy and climate bill—there is another oft-overlooked vehicle that advocates would be wise to consider. This year, Congress will likely pass a national transportation bill – legislation that comes up only about once every six years – through which the nation could reduce harmful greenhouse gas emissions from the transportation sector and significantly curtail petroleum use, thereby reducing U.S. dependence on foreign oil. The transportation bill also could deliver major economic benefits, including millions of new construction, operations and manufacturing jobs – just what the doctor ordered to fix what’s ailing the U.S. economy.

“Transportation is the fastest growing sector in terms of greenhouse gas emissions,” said Jill Kubit, assistant director of the Cornell Global Labor Institute, which encourages labor unions to become actively engaged in climate policy. “But it’s often neglected in terms of the solutions side, so we feel a real need to engage unions and workers around this issue.”

Cornell’s Global Labor Institute isn’t the only organization that is planning to engage groups in the upcoming transportation debate. The coalition Transportation for America was created in 2008 by Smart Growth America, Reconnecting America, and the Surface Transportation Policy Partnership. T4America, as the coalition is called, now counts some 400 organizations that support its agenda to create “a new national transportation program that will take America into the 21st Century by building a modernized infrastructure and healthy communities where people can live, work and play.”

“It’s astonished and gratified us the range of organizations that have realized a connection to transportation,” said David Goldberg, communications director at T4America. He listed AARP as being a T4America member that is concerned that the U.S. transportation landscape is unfriendly to aging Americans; the American Public Health Association as a member that is troubled by the health impacts of pollution from the transportation sector and the lack of physical activity that has resulted from our transportation infrastructure; and PolicyLink as a member that wants to provide poor communities with access to high quality and affordable transportation options.

Environmental groups like Environmental Defense Fund and Natural Resources Defense Council are also part of the T4America coalition because of their focus on climate change. “If you’re talking about climate change, transportation is about a third of the emissions, and you’re not going to be able to put all new vehicles that run on cleaner fuels out there in time to deal with the problem. Liquid fuel is going to be the fuel source for a lot longer, but part of what we need to do is not drive so much,” Goldberg said.

The transportation bill is so far-ranging that it touches many aspects of our lives. It addresses highways, bridges, highway safety, public transportation, railroads and high-speed rail, among other transportation issues. It includes the repair of existing transportation infrastructure as well as the financing of new highway and transit capacity. It targets metropolitan areas as well as rural areas. It regulates not only the movement of people, but also the movement of goods.

Groups that seek to reform of the transportation system also hope to address a wide diversity of issues through the transportation bill—climate change, health and safety, equity, smart growth and economic opportunity, among others. These groups are looking for more accountability throughout the transportation system and would like to shift more decision-making power away from states and toward metropolitan areas.

There is also a significant amount of money at stake, as well as the potential to create a large number of jobs. The last transportation bill was funded to the tune of $286 billion over six years; the current proposal by Minnesota Democrat James Oberstar, the chairman of the House Committee on Transportation and Infrastructure, would increase that amount to $500 billion over six years, including $50 billion for high-speed rail. Representative Oberstar testified in July that the bill will “create or sustain approximately six million family-wage jobs.”

Many economists consider the transportation sector to be rife with job creation potential. A recent study by the Economic Policy Institute (Transportation Investments and the Labor Market) found that a $250 billion investment in the U.S. transportation system would create more than 2.8 million direct and indirect jobs. The study also looked at the quality of the jobs that would be created by transportation investments and found that they were more likely to be unionized and less likely to require a college degree.

“Essentially, they’re better paying jobs and for workers who don’t have a college education, which are the workers who are suffering most, both in this economy and over the last 20 years,” said EPI’s Ethan Pollack, one of the report’s authors.

Ed Wytkind, president of the Transportation Trades Department of the AFL-CIO, concurs that transportation jobs have a higher level of union density than jobs in many other sectors of the economy. Wytkind’s organization represents 33 transportation unions across five modes of transportation: airlines, buses, rail, maritime and highway.

“Across the board, it’s a pretty dense industry when it comes to unionization,” Wytkind said. “This means you have higher wages, better benefits and better training. You probably have good quality healthcare, and you’re more likely to have a pension.”

Although Wytkind’s organization does not represent workers in transportation manufacturing, he is very interested in the potential for increased transportation investment to create not only construction and operations jobs, but also domestic manufacturing jobs. This interest is shared by other labor unions as well as businesses that want to revive the U.S. manufacturing sector, which has suffered over the past decade from vast numbers of U.S. manufacturing jobs going overseas.

“Most of our manufacturers are buying components and intellectual property from overseas. This [transportation bill] is a great opportunity to look at the next generation of locomotives and passenger rail cars and buses and make sure they’re not only more energy efficient, but that they also support American jobs,” Wytkind said.

The aforementioned EPI study estimated that a $250 billion transportation investment would create approximately 370,000 manufacturing jobs. Another recent study by the American Public Transportation Association (Economic Impact of Public Transportation Investment) found that for every $1 billion invested in capital expenditure for public transit, 3,109 new manufacturing jobs will be created.

Unfortunately, new manufacturing jobs – unlike those in construction and operations – often end up being created in other countries. Although transportation projects that receive federal funding are required by law to source a certain percentage of their components domestically and assemble the final products in the United States, much of the technological know-how required to produce cutting edge transit vehicles (such as high-speed rail) resides outside the U.S., and manufacturers often receive waivers to purchase their components from abroad. Even the U.S.-based transportation manufacturers are usually subsidiaries of foreign companies.

Charles Wochele is vice president of marketing and business development for Alstom Transportation, a French company that has facilities in New York, Illinois and California and employs some 1,600 U.S. employees in the passenger transportation field. He explained that many U.S. companies that specialized in rail manufacturing, like St. Louis Car and Pullman-Standard, got out of the business after the United States started moving away from rail and toward automobiles in the mid-20th century.

“It’s a global market and the U.S. doesn’t have that steady a market, so everyone pulled out and closed their doors on this business,” Wochele said. “If no one in the U.S. was buying automobiles, we wouldn’t have U.S. automakers.”

Jonathan Feldman, a professor at Stockholm University and expert in transportation manufacturing, offered a similar explanation in a March 2009 article in the American Prospect (“From Mass Transit to New Manufacturing”). He wrote, “The military-industrial system [which lured rail suppliers toward the superior profits available in the defense market], together with America’s huge subsidies for autos, created an economic and political environment that helped erode the incentives and capacities to domestically produce state-of-the-art mass-transportation goods.”

This means that rail manufacturers in the U.S—most of which are foreign companies—now work on a contract-to-contract basis, and often have to lay off workers once a contract ends. By contrast, Europe has had a steady and long-term commitment to public rail transportation. It has also standardized rail requirements from one European country to another. “In Europe, you can sell the same product across the borders without making a lot of changes,” Wochele said. “In the U.S., every contract seems to be different. It’s rare that you see two things made the same way.”

Wochele believes that despite the challenges of the U.S. market, transportation manufacturing could flourish in the U.S. if there were a dedicated funding source for public transportation. Right now, U.S. transportation funding is inconsistent, and transportation needs are paid for by a combination of fuel taxes and general funds revenues. Take high-speed rail, for example. After years of neglect, the Obama administration and Congress included $8 billion for high-speed rail in the American Recovery and Reinvestment Act (ARRA). Wochele said the Senate is deliberating allocating $1.2 billion for high-speed rail next year; Rep. Oberstar’s Surface Transportation Authorization Act proposes $50 billion over six years for high-speed rail.

Currently most U.S. transportation funding comes from the gasoline tax, which has remained static since 1993 and is not indexed to inflation. At 18.3 cents per gallon, the tax has lost 33 percent of its purchasing power over the last 15 years, according to Oberstar. Current funding for America’s transportation system does not even cover existing needs, leaving the U.S. with an annual transportation infrastructure deficit, said Jim Berard, communications director of the House Committee on Transportation and Infrastructure. If more funds are to be invested in transportation to create the jobs and other benefits for which many groups are advocating, either the gasoline tax will need to be increased, or a new and sustainable source of funding must be identified. However, with the economy still in a state of recession, most politicians are loath to support any tax increases. This is a key reason why the transportation bill, which expired in September 2009, has yet to be taken up by Congress and may not be seriously considered until fall 2010.

Funding is not the only challenge for those who seek changes in the U.S. transportation system to address environmental, public health, equity and other critical issues. Many groups still differ on their priorities. For example, while most groups support increased transportation investment, there are divisions as to whether public transportation should be on a more equal footing with highways. There are also divisions between organizations that support fix-it-first policies that prioritize repair and maintenance work on roads over new road and bridge construction, and those which argue that new road construction is needed to address traffic congestion and other problems. A new study released this week by the Center for Neighborhood Technology, Smart Growth America and U.S. PIRG took on this question from the jobs perspective and found that ARRA investments in public transportation created twice as many jobs per dollar as investments in highways.

Another potential roadblock is the disagreement between businesses and labor unions regarding “Buy America” provisions that are attached to federal transit investments. Labor unions are asking the Obama administration to close loopholes in Buy America policies and to make the waiver process more transparent so more transportation manufacturing jobs go to American workers. Businesses, on the other hand, typically want the freedom to negotiate the best deal they can for components, whether suppliers are based in the U.S. or abroad.

These issues will be discussed and debated throughout 2010 as Congress deliberates the transportation and jobs bills. In December, the Obama administration proposed that the jobs bill include a $50 billion infrastructure investment to go mainly toward highways, transit, rail and aviation. The House jobs bill, which was passed on Dec. 16, included approximately $37 billion in transportation investments.

To the extent that these investments create well-paying jobs and move the country toward a cleaner and more sustainable transportation system, they represent progress. But the transportation bill is still the 800 pound gorilla. As T4America’s Goldberg put it, “By all rights, this [transportation bill] ought to be the best opportunity in a generation to create a bold new vision for our national transportation policy.”