As part of a larger initiative stemming from “key findings” from reviews directed under President Joe Biden’s Feb. 24, 2021 Executive Order (E.O.) 14017, “America’s Supply Chains,” as well as “immediate actions the Administration will take to strengthen American supply chains to promote economic security, national security and good-paying, union jobs here at home,” the Administration has established a Supply Chain Disruptions Task Force (SCDTF).
A 250-page report, BUILDING RESILIENT SUPPLY CHAINS, REVITALIZING AMERICAN MANUFACTURING, AND FOSTERING BROAD-BASED GROWTH (downloadable below), includes reviews by the Departments of Commerce, Energy, Defense and Health and Human Services.
I searched the entire document for the words “railroad” and/or “rail,” expecting to get numerous hits, being that it is about “resilient supply chains.” My search took about 30 seconds, because—get this—the word “railroad” appeared only once, on p. 170, in a chart with teeny-tiny type: Figure 11: Economic Impact of Rare Earth Imports (by NAICS Code). (NAICS is the North American Industry Classification System.) It’s near the bottom of the chart, NAICS Code 336510, “Railroad Rolling Stock Manufacturing,” and references “Magnets.”
Here’s the definition of NAICS Code 336510:
“This industry comprises establishments primarily engaged in one or more of the following:
- “Manufacturing and/or rebuilding locomotives, locomotive frames and parts.
- “Manufacturing railroad, street, and rapid transit cars and car equipment for operation on rails for freight and passenger service.
- “Manufacturing rail layers, ballast distributors, rail tamping equipment and other railway track maintenance equipment.”
Ok, all that is relevant to supply chains. But “Rare Earth Imports” only, and specifically, “Magnets”? Wild guess: traction motors?
Before I launch into my “huh?” observations, some context is needed:
Described as “a whole-of-government response to address near-term supply chain challenges to the economic recovery,” the SCDTF will be led by the Secretaries of Commerce, Transportation, and Agriculture. It “will focus on areas where a mismatch between supply and demand has been evident: homebuilding and construction, semiconductors, transportation, and agriculture and food” and “bring the full capacity of the federal government to address near-term supply/demand mismatches. It will convene stakeholders to diagnose problems and surface solutions—large and small, public or private—that could help alleviate bottlenecks and supply constraints.”
The Department of Commerce “will lead a coordinated effort to bring together data from across the federal government to improve the federal government’s ability to track supply and demand disruptions and facilitate information sharing between federal agencies and the private sector to more effectively identify near term risks and vulnerabilities.”
“Departments and Agencies across your Administration have already begun to implement the report’s recommendations,” wrote Assistant to the President for National Security Affairs Jake Sullivan and Assistant to the President for Economic Policy and Director of the National Economic Council Brian Deese to Biden, in the report’s Introductory Note. “These include steps to strengthen U.S. manufacturing capacity for critical goods, to recruit and train workers to make critical products here at home, to invest in research and development that will reduce supply chain vulnerabilities, and to work with America’s allies and partners to strengthen collective supply chain resilience. Both the public and private sector play critical roles in strengthening supply chains, and your Administration will continue to work with industry, labor, and others to make America’s supply chains stronger.
“We have already launched the second phase of the supply chain initiative you directed in E.O. 14017, which reviews six critical industrial base sectors that underpin America’s economic and national security: the defense industrial base, public health and biological preparedness industrial base, information and communications technology industrial base, energy sector industrial base, transportation industrial base, and supply chains for production of agricultural commodities and food products. We will report back to you on those sectors by Feb. 24, 2022, the one-year mark of your signing E.O. 14017.”
So, let me get this straight: The federal government wants—rather encouragingly—to improve supply chains, make them more resilient. How does it expect to do this without involving freight rail, and for that matter, North American freight rail, the finest system of its type in the world?
I don’t get it. Am I missing something here?
Would someone at the Association of American Railroads please explain to me how a White House-appointed task force, named with a complex acronym and charged with identifying and addressing supply chain resiliency, could produce a 250-page report, action plan, whatever you want to call it, that almost completely ignores rail? Is it possible that those responsible in our industry for knowing what’s happening at the White House and on Capitol Hill weren’t aware of this task force? Or if they were, deemed it not all that important?
Maybe, since the “transportation industrial base” is referenced here, freight rail will be part of the SCDTF 2022 report? Or am I expecting too much?