Home | A Vision for a Globally Competitive America - Creating Strategies for the 21st Century

A Vision for a Globally Competitive America
Creating Strategies for the 21st Century

An understanding of how the U.S. must interact with world trading patterns is required to guide policy for and investment in the U.S. transportation system. Major changes have taken place in the global economy over the last twenty years. They can be grouped into three broad categories:

A New Economic Geography

As the 21st Century opens, the old economic geography, which had separated the Free World from the Communist Bloc, has given way to a new economic geography defined by trade blocs (e.g., European Union, NAFTA, Russian Federation, South America, Africa, Asia, China, and India as single-nation trade blocs).

A New Economy

Globalization of the marketplace has led to the redistribution of business activity worldwide based on a variety of factors including labor costs, natural resources, access to consumer markets and transportation infrastructure. New technologies have transformed businesses and led to a knowledge economy.

An Integrated Global Network

The global network moves people, goods and information continuously around the world. It is characterized by new trade patterns, new flow patterns, and hubs playing new roles. The U.S. transportation system is a subsystem within the global network.

Positioning the United States for the Future

To develop national policies that will keep the United States competitive in the global economy we need to ask, “Is America positioning itself as a 20th Century nation or a 21st Century nation?” The information which follows should help answer that question.

Figure 14. Free World Trade Routes

Divided World Before 1990

The 20th Century was the “American Century” as all Free World trade routes converged on the U.S. (Figure 14.)

For most of the 20th Century the world was divided by two competing ideologies and separated by the Iron Curtain.

The trade patterns and hubs that marked this period were established to Europe, Latin America, Southeast Asia and Japan connecting with U.S. hubs including L.A. and San Francisco on the Pacific Rim, Miami in the south Atlantic, and into the port of New York on the north Atlantic.

New York was the major financial center, and Washington, D.C. the political capital of the Free World.

The U.S. surface transportation system was largely created, evolved and was reshaped during this period. Foreign trade accounted for less than 10 percent of U.S. economic activity and the principle international trade patterns were Midwest outbound.

Figure 15. Emerging Trade Blocs Will Generate a New Freight Dynamic

Trade Blocs in the Global Network

Since the fall of Communism, a single continuous and integrated global network composed of air, sea, road, rails and communications that moves people, goods and information around the world has taken shape.

Within that network, a new system of trade blocs has developed based on the need for larger competitive units to compete with the emerging single-nation trade blocs of China and India. These blocs include North America ( as a result of the NAFTA treaties), the European Union and the Russian Federation. (Figure 15.)

Trade now accounts for 30 percent of the U.S. economy. This has increased the importance of developing an efficient surface transportation system that can link the U.S. economy to the seaports and airports that connect the continent to the other trade blocs.

The U.S. is an “island nation,” that can only reach the world marketplace by air or sea.

Europe and Asia are connected by highways and railroads as well as by air and sea.

In 2000, the U.S. economy represented 31 percent of the World Gross Product, the European Union 27 percent and Asia 24 percent. By 2030, it is anticipated that China will have passed the U.S. as the single largest national economy.

Figure 16. Trade Bloc Infrastructure Investment

Across the world, the different trade blocs have created continental scale infrastructure plans to help form the basis for their economic growth. (Figure 16.)

  • The most ambitious, multi-modal and integrated planning is being done in Asia—especially China and Korea.

  • The European Union has an ambitious infrastructure plan to facilitate European economic integration and accommodate the new trade patterns that now include the rising Mediterranean trade, which had languished for centuries.

North America and the U.S. would appear to be at a competitive disadvantage without a national or continental policy, planning and investment framework to guide their future.

 

A Vision for a Globally Competitive America
Creating Strategies for the 21st Century (Continued) >>