(HOST) Commentator Allen Gilbert thinks there’s an important economic lesson to be learned by watching – trains.
(GILBERT) I’m a bit of a railroad enthusiast. Have been ever since I was a kid and received an American Flyer toy train set one Christmas.
So you can imagine my excitement when I found myself in Flagstaff, Arizona, earlier this summer and saw that the old Santa Fe Railroad line still runs right through the middle of town – next to old Route 66, in fact. I plunked myself down on a bench outside the railroad station and vowed to stay there until a train came. I thought I’d be there hours. Here in the East, most rail lines see little traffic.
It was no more than five minutes until a train roared by – a huge train, over one hundred cars long, pulled by four roaring diesel locomotives. I turned to join the rest of my family, when another train appeared, going in the opposite direction – same thing, over one hundred cars long. Over the course of the next few days, I saw more trains than I see in Vermont in a year. On average, a train passed through Flagstaff about every twenty minutes. And nearly every train was carrying cargo containers, loaded off ships at ports in California and heading east or returning west for more freight.
Yes, Flagstaff is a great place to watch trains. But there’s another lesson here. That lesson is how cheap it’s become to ship goods from places like China or Malaysia to places like Bentonville, Arkansas, or Burlington, Vermont. Indeed, as a recent New Yorker article noted, only seventy-five cents of the fifty dollar retail price of a pair of shoes made in China is due to shipping. That’s less than two percent. Globalization has made the location of labor largely irrelevant.
I returned from Flagstaff, and read how here in Vermont “affordability” has been identified as a political issue in some of this year’s political races. I shook my head at the simplistic arguments that high taxes are to blame for the economic pinch we’re all feeling. The reality is what people like New York Times columnist Thomas Friedman have been writing – globalization poses the most serious challenge to our economic way of life that we’ve seen in generations. The “good jobs” that once went to the highly skilled workers in southeastern Vermont’s Precision Valley are gone, shipped abroad. Some computer tech jobs at National Life in Montpelier were outsourced. We are in competition with workers from around the globe. Not all industries have been affected, but eventually most will be.
Friedman thinks that globalization is inevitable, and we have to learn to live with it. He thinks that, if we’re smart, we can use it to our advantage. I’m not sure that I agree. But I do know that it’s naive to suggest that cutting state taxes will lead to a new wave of prosperity here in Vermont. The economic forces at work around us are a lot more complicated than that.
Allen Gilbert is a former journalist, teacher, and consultant currently serving as executive director of the ACLU of Vermont. He has a longtime interest in public policy issues.