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Recovery is slow to get on board
A Union Pacific freight train.
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KAI RYSSDAL: You want to know what's happening in the economy, you gotta get out there. Sniff around. See what's actually being bought, sold and processed where the rubber meets the road. Check the traffic to factories and warehouses and on to retail stores. See what's happening with freight trains, long hauls trucks and car carriers.
That's what Marketplace's Mitchell Hartman has been up to today.
Mitchell Hartman: Shipments of everything from coal for power plants to lumber for construction sites to cars for dealer lots are down from a year ago. That's according to a report this week from the Association of American Railroads.
Dan Keen is their economist.
Dan Keen: Beginning in the fall, freight rail traffic basically fell off a cliff. And has stayed down in double digits.
The good news, such as it is, is that freight trains have stopped getting shorter. Keen says rail companies are starting to take cars out of storage. And that's a sure sign they're getting more orders to move raw materials to factories and consumer goods to distribution warehouses.
Chuck Clowdis follows the freight industry at IHS Global Insight.
Chuck Clowdis: And that pent up demand, a portion of that's being released now. As the consumer starts buying, and plants start putting people back to work, there are more trucks on the road, the trains are longer.
And the ships are coming in. At the Port of Portland there are more cars and shoes arriving from Asia; more wheat and minerals heading the other way. Port spokesman Josh Thomas says volume was up from July to August, but it's still down 15 to 60 percent from a year ago. And that hurts if your job depends on moving stuff.
Josh Thomas: There is a domino effect, not only here at the port, but with many private companies, shippers, logistics firms, the longshoremen.
Economists say this whole complex of ports, rail and trucking will have to see sustained growth before many idled employees can get back to work.
I'm Mitchell Hartman for Marketplace.
It's always very simple to me. The pre-recession economy was based on debt, for many many years. Debt potential is based on credit scores. If a credit score requires 18 months of perfect history in order to jump back from a mistake, then there's no way the economy can "jump back" until eighteen months after people have been good. We'll get to the start of that recovery period when people can escape their overdraft courtesy rape cycle from banks and as inflation stays steady. Like from 2005 to 2008, all it takes is that 12% inflation increase to lessen your income and put you in that red margin of week to week living.
