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U.S. Ports: Investing in Engines of Economic Development and American Competitiveness

In order to support U.S. competitiveness in a global economy, it is essential that we modernize and maintain our U.S. ports and our marine transportation system.

U.S. ports and our marine transportation system – and the hardworking men and women behind these operations – are essential drivers of the American economy. Every day, our ports and waterways handle millions of tons of domestic and international cargo, including food and agricultural products, petrochemicals, and automobiles.  In 2014 alone, $1.7 trillion worth of U.S. goods moved through our ports, representing 75% of imports and exports by weight.

But ports, like our highways and bridges, face challenges. As a country, we are investing too little, and as container ships grow larger and larger, more cargo must be unloaded into increasingly tight spaces. And ports face unique operational challenges as they move ever-expanding volumes of cargo between ships, trucks and rail lines. Today, not a single U.S. container port is in the top 15 container ports globally according to the Journal of Commerce. Expanding trade will continue to put pressure on the existing system, increasing congestion and threatening U.S. economic competiveness; looking forward, the demand to move goods and raw materials on the U.S. transportation system is predicted to increase by 45 percent by 2040.

To support U.S. competitiveness in a global economy, it is essential that we expand, upgrade, modernize and maintain our maritime transportation infrastructure and strengthen our workforce. That’s why the Obama Administration has been working to identify opportunities to increase investment in U.S. ports. Recently, the Department of Transportation (DOT) announced $800 million in available funding for the nation’s freight network and highlighted the opportunity for investments in 21st century ports. DOT’s new FAST LANE program expands on the work of the Build America Transportation Investment Center, which has been helping ports around the country access Federal financing programs. Through seven rounds of funding, the Transportation Investment Generating Economic Recovery (TIGER) program has provided $524 million for 43 port and or marine highway projects in 24 states, helping to increase port efficiency and capacity.

Investments in ports don’t only benefit trade. Ports are also integral to regional economies. They serve as hubs for transportation and logistics industries that want to locate facilities near strategic transportation centers. Today, ports support millions of American jobs in port communities and throughout the U.S. supply chain. These are solid, middle-class jobs that often come with the opportunity to join a union, an important way that workers can bargain for higher wages and better benefits, and also have a say in how the port operates and innovates.

To highlight the potential for ports to drive the U.S. economy, this morning we traveled to Tradepoint Atlantic in Baltimore County. Tradepoint Atlantic is a major new industrial development on the site of an abandoned Bethlehem Steel mill. In the 1950s and 1960s, the Baltimore Bethlehem Steel mill was one of the largest steels mills in the world and employed tens of thousands of workers from Baltimore City and the surrounding counties. But over the past decades, the mill declined and eventually closed all together. Today, the site is showing new signs of life. Purchased by new owners in 2014, the developers are working with the local, state and Federal governments to transform Tradepoint into a center for the manufacturing and transportation and logistics industries, capitalizing on the region’s strategic assets – like access to a deep water port, Interstate-95, major freight rail lines, and airports.

Tradepoint Atlantic is an example of how the Port of Baltimore is catalyzing economic growth in the Baltimore region and creating jobs. In the last few years, logistics, shipping and manufacturing companies have started to make investments in the zone around the Port. For example, Amazon has invested in a major new local facility near the Port, which has created more than 3,500 jobs, while a new manufacturing firm, Blueprint Robotics, will open this summer, with plans to employ more than 100 people in its first year. These new jobs build on the existing economic footprint of the Port, which supports 14,600 direct jobs and is responsible for $3 billion in combined wages and salaries.

There’s a significant opportunity for other communities around the country to use their ports to drive economic growth. Over the next five years, ports anticipate investing an average of $30 billion per year in new facilities and infrastructure. These investments can catalyze major economic development, especially if undertaken in close coordination with city and state governments and complemented by investments in public transportation and workforce development.

Port investments can also improve U.S. port capacity and efficiency.  And, new authorities like those provided in the Trade Facilitation and Trade Enforcement Act of 2015 signed by the President on February 24 will help U.S. Customs and Border Protection to more efficiently and effectively speed goods through ports, while preventing counterfeit and other goods that violate our trade laws from making it into the U.S. marketplace.  These investments and efforts will help us take advantage of the leveled playing field and increased market access that will be enabled by the Trans-Pacific Partnership (TPP) and other Administration trade initiatives. We need to improve port efficiency now if we are going to maximize TPP’s ability to create more port-related jobs and ensure that more Made in America exports are shipped around the world.

But the federal government cannot address port-related challenges alone.  That’s why, during our visit to Tradepoint Atlantic, we held a meeting with leaders from ports, labor, shippers and retail companies from around the country to discuss how the Federal government can work collaboratively with stakeholders to build 21st century ports – and lay the foundations for sustained long-term growth.