Monday, January 1, 2007

European Union: Transportation "Problems"

January 3, 2007

The "traveling salesman problem" is a well known "problem" in transportation and logistics. Europe's transportation problem is no less complicated. So is the whole world's.

Air Transportation:

In an era of an apparent recurring economic nationalism, how consistent are the US limitations on foreign ownership of US based airlines with the concepts and supposed trend of globalization and free trade, etc?

Is the air transportation activity a by nature "physical" oligopoly and thus a strategic public policy sector? In other words, what justifies such regulatory constraints such as the US airline ownership rules in this 21st century? Many replies can be offered, some economic, some safety related, some post 9/11 security related, etc. For example, in some countries, fleets have to be subject to the option of being "drafted" for military purposes in case of war! But are any of those replies sufficient to justify a general "no foreign nationals ownership or control of US based airlines" rationale? Without any "favored nations" clauses (as in other activities).

Across the Atlantic, in Europe, 14 years after the Single Market, the EU is not having much success in consolidating airlines and other "national" champions into more viable at a world stage structures! Most national airlines are still national, in spite of trends and dynamics and the launching of a variety of successful budget airlines operating at European level!

"Open Skies" are not that visible in the skies of Europe and the US, and that is not solely a result of post-911 dynamics.


As of Tuesday (1 January 2007) all rail freight services in the EU, inside and between member states, are open to competition.

Meanwhile, in the UK, recent price increases in the unregulated portions of rail activity have caused reactions.

We "want the railways to grow" says the UK's Department for Transport. So do the European Commission and many other parties and organizations of the Citizens' Society in the UK and in Europe. Yet road transportation continues to be the most attractive, price-wise and flexibility-wise, both passenger and freight related! Many claim that this is because road transportation externalizes many of its costs to the "environment" and thus these need to be internalized, via various policies and schemes! This policy view is not new, but its results are still to be examined!

Systemics of transportation:

A key strategic or even philosophical policy question is: Is transportation, of people or goods, a key element of globalization? Yes or No? And if Yes, is that a good thing, yes or no? Is mobility a wanted policy goal anymore, as it used to be, or has the tide changed? Is mobility still viewed as a "driver" of freedom or not?

These are indeed tough policy issues. maybe Gordian knots. But they are in urgent need of some kind of consensus based agreement! Because in this day and age, of uncertainty, policies need to be as clear and as certain as possible, else they make our lives and our decisions harder than they already are, rather than easier (which case, what is their utility?).

So, does "Europe" have a comprehensive policy view on transportation? After all, transportation is a "common EU policy" area, unlike many others (e.g. employment or economic policy)!

Well, it does not seem so! And there are many parties eager for a clear and comprehensive transportation policy, because we do live in an era when transportation is much more crucial to everyone's life than (possibly) ever before (companies and people). Note: The same applies to telecoms, but in telecoms the effect is much more evident than in transportation!

Production and distribution: two key parameters in the economic activity, with a vast and complex set of parameters and effects, to users, clients and providers and workers!

Who can decide what is "rational transportation" and what is not? Are transportation modes, by nature, suitable for pure market dynamics or does the public sector have a role? E.g. in infrastructure "hungry" transportation modes. And in "pollution rich" ones!

The European and world public opinion needs policy makers to decide and communicate their strategic or philosophical stance on the matter: Is transportation a good or a bad thing, after all? A problem or a solution "vehicle" to life's core issues of the citizen/voter?

Such a strategic or systemic stance is needed, and it needs to be quite clear! Is transportation to remain the public/mass good and everyone's right it has become in recent times, or do environmental or security or infrastructure cost constraints make limits on this right (even through pricing) a necessity? That is a key question!!!

To produce or to transport? Is the public affairs backlash against transportation driven, by some quarters, as part of a clever anti-globalization strategy? Are we, in effect, being told or forced to rethink the axiom of "economies of scale in production, global distribution"? Are we?

Is a core part of this re-emerging"economic nationalism" a covert or de-facto return to a "produce locally, sell locally" scheme? Just a thought!

Soul Searching

Rotten tomatoes
Ripe apples
Green acres
Blue oceans

Rotten souls
Cheap perfumes
Green hearts
Red faces

Rotten dreams
Cheap thrills
Green bucks
Maroon colors

Rotten memories
Cheap mementos
Green leaves
Black ties

Memories were made
to fade for a reason!

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