The Lock 52 bottleneck and potential impact

An article in the New York Times (November 23, 2016) titled “Choke Point of a Nation:The High Cost of an Aging River Lock” describes the 80 million tons of grain, coal, fuel and other products worth $22 billion in trade that flows on the Ohio river and depends on locks 52 and 53.  It takes 15 hours to pass through lock 52 and 48 hours to pass through lock 53 and thus 5 days to travel 100 miles along the river. Any failure of these locks would freeze water traffic and result in increased costs to move products, and thus higher consumer prices. A replacement dam’s completion has been delayed for over 20 years and is over budget by over $2 billion. How should the cost of such infrastructure, whose benefits are spread across the supply chain, be absorbed by the country? Should private infrastructure companies, who are permitted to recoup their costs through tools, be the solution ? Should the trade groups of users of the infrastructure be asked to develop solutions ?

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About aviyer2010

Professor
This entry was posted in Capacity, consumer, Cost, delivery, disruption, logistics and tagged , . Bookmark the permalink.

One Response to The Lock 52 bottleneck and potential impact

  1. Kyle Harshbarger says:

    Privatization seems like the obvious solution. I’m not sure why transportation has not already moved towards a completely pay-for-use system. Surge pricing to handle congestion.

    In the case of the locks, since the cost is being absorbed by some sort of tax funding, this distorts the transportation market. Maintenance costs are baked into transportation costs only when we talk about initial funding at the government level. However they become unmaintained over time because it is not attractive to pay for maintenance. It is not until bridges collapse (see Minnesota) that people start taking maintenance seriously. Unfortunately even that is not enough. Private companies can do this better.

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