Alex Binkley on Transport Report
The Binkley Report
Alex Binkley is a foremost political and economic analyst, whose website is www.alexbinkley.com. Readers will be aware that his columns in True North Perspective have foreseen political and economic developments in Canada. In this edition . . .
Transportation report covers
a lot of ground, deserves more attention
By Alex Binkley
True North Perspective
There are enough recommendations and ideas in the recent report assessing federal transport policies and regulations to keep Transport Minister Marc Garneau busy for years.
However the report’s theme of assessing the transportation system in light of its importance to the country’s future prosperity will likely become lost in the debates over its more 60 detailed recommendations on everything from railway service to the regulatory effectiveness of the Canadian Transportation Agency.
While the report was presented to the government before Christmas, Garneau didn’t comment on its proposals until after its release in late February. He said the review “looks ahead, over the next 20 to 30 years, to examine how we can maximize the contribution of our transportation system to support Canada’s economic growth.” Other than vague references to discussions with provincial governments, he hasn’t indicated whether there will be formal, public consultations.
David Emerson, the former cabinet minister who headed the panel reviewing the Canada Transportation Act and related policies, says, “The advent of globalization has fundamentally altered the nature of industry and the evolving role of transportation and logistics in achieving competitive success. Not surprisingly, governments must also adapt policy and regulatory approaches to secure the competitive position of the country.”
In other words, let’s stop focusing so much on the specific well-being of the carriers and ports and airports and start judging the overall effectiveness of the transportation system and how well it’s doing in moving Canada’s imports and exports and Canadians to their destinations. That has to include trucking, which is mainly regulated by the provinces but is obviously vital to the national economy.
“In a world of massive and complex webs of interconnectedness, the quality of transportation and logistics systems may be the single greatest contributor to a country’s economic performance,” Emerson contends. This could be an excellent litmus test for the any new federal policies.
The last review of federal transportation policies and regulations occurred in the much different world of 2001. “Given the global pace of change, 15 years is too long to wait for re-evaluation of the transportation landscape. In the intervening years, a significant number of problems have surfaced, giving rise to a series of reactive and impromptu policy responses,” Emerson asserts.
“But transportation is increasingly a large, complex and finely tuned system that is not amenable to quick fixes, narrowly conceived. Looking forward, it will be important to develop a systemic framework that is adaptable, and enhances connectivity, competitive choice, and quality of service.
“In addition, it must provide for continuous investment in infrastructure that integrates and improves the overall transportation and logistics system. A new strategic framework will require a clear sense of future direction, updated governance structures, and renewed regulatory capacity.”
An efficient transportation system is more important to international competitiveness than duties and tariff rates, he continues. “Second, turbulence and change beyond our borders permeate quickly and deeply into the economic life of Canadians. A major challenge, therefore, is to develop our capacity for rapid adaptation to natural disasters and other predictable disruptions, as well as to emerging trends and changes that are hard to foresee and largely beyond our control.”
An efficient transportation system is more important to international competitiveness than duties and tariff rates, he continues. “Second, turbulence and change beyond our borders permeate quickly and deeply into the economic life of Canadians. A major challenge, therefore, is to develop our capacity for rapid adaptation to natural disasters and other predictable disruptions, as well as to emerging trends and changes that are hard to foresee and largely beyond our control.”
As for bottom lines, the Review heard that “while competition and market forces have served Canada well, particularly in complex and dynamic conditions, they function imperfectly. The Canadian transportation system continues to feature dominant players, captive markets, the legacy of state-owned operations, and critical infrastructure requirements unlikely to be met without government involvement. It is recognized among those who participated in the Review that transportation policy must be grounded in a clear and realistic sense of the future; an appreciation of what market forces can deliver; an understanding of what government action may be necessary; and consistent principles to guide government activity in the transportation and logistics space.”
Canada needs to work with the United States and Mexico to grow the economy and preserve market access while maintaining strong environmental stewardship. A harmonized approach in partnership with the U.S. and Mexico, while recognizing each country’s unique challenges, is one that stakeholders endorse as a significant step in this direction.
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