    [House Hearing, 115 Congress]
    [From the U.S. Government Publishing Office]

               BUILDING A 21ST-CENTURY INFRASTRUCTURE FOR AMERICA

    =======================================================================

                                    (115-1)

                                    HEARING

                                   BEFORE THE

                                  COMMITTEE ON
                       TRANSPORTATION AND INFRASTRUCTURE
                            HOUSE OF REPRESENTATIVES

                         ONE HUNDRED FIFTEENTH CONGRESS

                                 FIRST SESSION

                                   __________

                                FEBRUARY 1, 2017

                                   __________

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                 Committee on Transportation and Infrastructure

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                 COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

                      BILL SHUSTER, Pennsylvania, Chairman
    DON YOUNG, Alaska                    PETER A. DeFAZIO, Oregon
    JOHN J. DUNCAN, Jr., Tennessee,      ELEANOR HOLMES NORTON, District of
      Vice Chair                             Columbia
    FRANK A. LoBIONDO, New Jersey        JERROLD NADLER, New York
    SAM GRAVES, Missouri                 EDDIE BERNICE JOHNSON, Texas
    DUNCAN HUNTER, California            ELIJAH E. CUMMINGS, Maryland
    ERIC A. ``RICK'' CRAWFORD, Arkansas  RICK LARSEN, Washington
    LOU BARLETTA, Pennsylvania           MICHAEL E. CAPUANO, Massachusetts
    BLAKE FARENTHOLD, Texas              GRACE F. NAPOLITANO, California
    BOB GIBBS, Ohio                      DANIEL LIPINSKI, Illinois
    DANIEL WEBSTER, Florida              STEVE COHEN, Tennessee
    JEFF DENHAM, California              ALBIO SIRES, New Jersey
    THOMAS MASSIE, Kentucky              JOHN GARAMENDI, California
    MARK MEADOWS, North Carolina         HENRY C. ``HANK'' JOHNSON, Jr.,
    SCOTT PERRY, Pennsylvania                Georgia
    RODNEY DAVIS, Illinois               ANDRE CARSON, Indiana
    MARK SANFORD, South Carolina         RICHARD M. NOLAN, Minnesota
    ROB WOODALL, Georgia                 DINA TITUS, Nevada
    TODD ROKITA, Indiana                 SEAN PATRICK MALONEY, New York
    JOHN KATKO, New York                 ELIZABETH H. ESTY, Connecticut,
    BRIAN BABIN, Texas                       Vice Ranking Member
    GARRET GRAVES, Louisiana             LOIS FRANKEL, Florida
    BARBARA COMSTOCK, Virginia           CHERI BUSTOS, Illinois
    DAVID ROUZER, North Carolina         JARED HUFFMAN, California
    MIKE BOST, Illinois                  JULIA BROWNLEY, California
    RANDY K. WEBER, Sr., Texas           FREDERICA S. WILSON, Florida
    DOUG LaMALFA, California             DONALD M. PAYNE, Jr., New Jersey
    BRUCE WESTERMAN, Arkansas            ALAN S. LOWENTHAL, California
    LLOYD SMUCKER, Pennsylvania          BRENDA L. LAWRENCE, Michigan
    PAUL MITCHELL, Michigan              MARK DeSAULNIER, California
    JOHN J. FASO, New York
    A. DREW FERGUSON IV, Georgia
    BRIAN J. MAST, Florida
    JASON LEWIS, Minnesota

                                    CONTENTS

                                                                       Page

    Summary of Subject Matter........................................    iv

                                   WITNESSES

    Frederick W. Smith, Chairman and Chief Executive Officer, FedEx
      Corporation:

        Testimony....................................................     7
        Prepared statement...........................................    62
        Responses to questions for the record from Hon. Andre Carson
          of Indiana.................................................    77
    David W. MacLennan, Chairman and Chief Executive Officer,
      Cargill, Incorporated:

        Testimony....................................................     7
        Prepared statement...........................................    79
    Ludwig Willisch, President and Chief Executive Officer, BMW of
      North America:

        Testimony....................................................     7
        Prepared statement...........................................    84
        Responses to questions for the record from Hon. Andre Carson
          of Indiana.................................................    90
    Mary V. Andringa, Chair of the Board, Vermeer Corporation:

        Testimony....................................................     7
        Prepared statement...........................................    91
    Richard L. Trumka, President, American Federation of Labor and
      Congress of Industrial Organizations (AFL-CIO):

        Testimony....................................................     7
        Prepared statement...........................................   103
        Responses to questions for the record from the following
          Representatives:

            Hon Peter A. DeFazio of Oregon...........................   110
            Hon. Andre Carson of Indiana.............................   111

              PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS

    Hon. Henry C. ``Hank'' Johnson, Jr., of Georgia..................    59
    Hon. Elizabeth H. Esty of Connecticut............................    61

                           SUBMISSIONS FOR THE RECORD

    Letter of February 1, 2017, from AAA, et al., to President Donald
      J. Trump, submitted by Hon. Bill Shuster, Chairman, Committee
      on Transportation and Infrastructure...........................   113

                            ADDITIONS TO THE RECORD

    Statement of Matt Smith, President, Greater Pittsburgh Chamber of
      Commerce.......................................................   123
    Statement of the National Association of Small Trucking
      Companies, submitted by Hon. Brian Babin, a Representative in
      Congress from the State of Texas...............................   125

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               BUILDING A 21ST-CENTURY INFRASTRUCTURE FOR AMERICA

                                  ----------

                          WEDNESDAY, FEBRUARY 1, 2017

                      House of Representatives,
        Committee on Transportation and Infrastructure,
                                                Washington, DC.
        The committee met, pursuant to notice, at 10:03 a.m. in
    room 2167, Rayburn House Office Building, Hon. Bill Shuster
    (Chairman of the committee) presiding.
        Mr. Shuster. The committee will come to order. Good
    morning. I want to welcome you all here to the first full
    committee hearing of the House Transportation and
    Infrastructure Committee for the 115th Congress.
        I want to welcome our new Members; we have about 14 new
    Members on the committee. And, of course, welcome to our
    returning Members. I look forward to working with each and
    every one of you during this Congress, which I believe will be
    a very, very busy Congress. And our committee will be very,
    very busy.
        This morning's hearing is about looking into the future and
    how we build a 21st-century infrastructure for America. But
    before we begin, I would like--I think it is important for us
    to remember some of the successes that the committee has had in
    the last Congress.
        Our committee worked in a bipartisan fashion, was
    incredibly productive over the last 2 years. We were able to
    move large, complex pieces of legislation to improve America's
    infrastructure. The FAST Act [Fixing America's Surface
    Transportation Act], the WIIN Act [Water Infrastructure
    Improvements for the Nation Act], our PRRIA [Passenger Rail
    Reform and Investment Act] and Amtrak reforms bill, the PIPES
    Act [Protecting our Infrastructure of Pipelines and Enhancing
    Safety Act], the Coast Guard Authorization Act, and other
    committee bills are now law because we were able to build
    consensus and get things done for the American people. Our
    track record speaks to the hard work of our Members and our
    staff.
        For our new committee members here today, take note. Our
    goal is the same level of success for this Congress, so get
    ready to roll up your sleeves and get to work, or get ready to
    jump in the ditch with the pick and the shovel. We got a lot of
    work ahead of us.
        America's infrastructure is the backbone of the economy. As
    a people, we are bound together by our values, our dedication
    to our liberty, our freedoms. But physically, we are bound
    together by our transportation network. And this is a large
    country, and it wouldn't be the great country it is today if it
    wasn't for that physical connection, coast to coast, northern
    border to the southern border States. And from the beginning of
    our very First Congress that authorized the first Federal
    lighthouses, the transcontinental railroad, to the Panama
    Canal, to the Interstate Highway System, to the Nation's
    airports, the Federal Government has played a vital,
    constitutional role in ensuring the American people and our
    economy are connected through infrastructure.
        And, in fact, those of you in the audience, behind you we
    put up two of which I think are important pieces of history.
    First, Adam Smith, ``The Wealth of Nations,'' talking about
    what Government's to do for the people. And basically, it boils
    down to three things. It is: provide security, preserve
    justice, and erect and maintain infrastructure to promote
    commerce. So that is a fundamental role of Government, whether
    it is the Federal Government, the State government, or local
    governments.
        And then, of course, the Founding Fathers, who all read
    Adam Smith, when they penned the Constitution, article I,
    section 8 talks about powers of Congress to protect the common
    defense, regulate commerce, and to establish post roads. And,
    of course, the post roads today are the highways and byways of
    our Nation.
        And I am proud to say that the first highway authorized and
    appropriations went to to build a road happened to go through
    my district and the home of one of our witnesses here, Mr.
    Trumka, right through Fayette County and Greene County,
    Pennsylvania, the national road, which is Route 40 from
    Baltimore to the Ohio Territories.
        So, again, from the beginning of the founding of our
    Nation, it is important to--and that highway, by the way, is
    over 200 years old. It was finished in about 1815 or 1816. So,
    again, from the beginning of our country, the Federal
    Government has had a role, and it needs to have a strong role.
        And a strong infrastructure means a strong America, an
    America that competes globally, supports local, regional,
    economic development, and creates jobs. However, our
    infrastructure will face significant challenges in the future,
    and we are facing challenges today to rebuild it.
        But in the future, the forecasts predict that our
    population will grow from about 320 million just last year to
    400 million by 2051. The movement of freight is expected to
    increase by 40 percent over the next 30 years. And I have--
    right in my district I have Route 81 that is a two-lane--or,
    excuse me, a four-lane highway that--it is--it looks like a
    railroad at night, because there are so many trucks on it, so
    much freight, so much commerce moving on that highway. And that
    is just one roadway in America. And there are many, many others
    that look like that.
        By the end of the next decade, air travel demand is
    expected to increase from 750 million passengers annually to 1
    billion. And transportation technology continues to evolve.
    Driverless cars, commercial drones, and commercial space
    transportation are just a few examples of this change, but more
    changes are coming. Our infrastructure policies have to keep
    pace with these changing technologies. We must be able to meet
    our infrastructure needs of today, but also be poised to tackle
    the challenges of tomorrow.
        One thing November's election taught us was that the
    American people are ready for their elected officials to
    rethink the way we do things here in Washington and challenge
    the status quo. This election also raised the profile of
    infrastructure in the minds of the American people and
    policymakers. In fact, I believe this was the first time a
    President ever mentioned the word ``infrastructure'' in an
    inaugural address.
        This feeling of optimism is echoed by over 400 associations
    who wrote in support of investing in infrastructure and fixing
    the Highway Trust Fund. Their thoughts are contained in this
    letter, which I believe I have here--I am supposed to hold it
    up, but I don't know where it went--this is the letter, 400
    different associations have signed it. And I would like to
    enter into the record.
        Without objection, so ordered.
        What this means for us, it means that we now have a unique
    opportunity. The wind is at our backs, and it is time to act on
    our infrastructure's needs. President Trump made a promise to
    the American people that he would reassert America's greatness.
    And from my perspective, that means ensuring that America is
    competitive in the crowded global marketplace of today and
    tomorrow. It means reimagining and building and rebuilding a
    21st-century infrastructure, leveraging resources from all
    levels of Government and the private sector.
        Modern infrastructure lets our people, goods, products, and
    crops get where they need to go more efficiently and at less
    cost. Improved roads and bridges reduce bottlenecks and
    problems that slow the flow of commerce.
        Modern infrastructure is an aviation system with truly
    modern, efficient, and transformational air traffic control
    technology. It is ports and waterways that let our farmers and
    manufacturers move their crops and products to remain
    competitive with other nations. It is rail systems that focus
    on more effective, efficient service in regions of the country
    where rail transportation works well. It is pipelines that can
    transport the energy products that will power us into the
    future. It is infrastructure that is resilient when natural
    disaster strikes. It is infrastructure that can be built
    faster, unburdened by bureaucracy and impediments to private
    investment. And it is infrastructure that encourages innovation
    and unleashes the next revolution in mobility.
        Modern infrastructure means jobs, because when
    transportation efficiency improves the bottom line for our job
    creators, then they can put more people to work. That is my
    vision for a 21st-century infrastructure, and it can be
    achieved if we work together and build it.
        I welcome our panel of experts here today, look forward to
    hearing from you. And your organizations have a unique
    understanding of our infrastructure needs. And as I look out
    there, they are all the users of the system and people that
    build the system but, again, use the system. And we really
    appreciate your taking the time to be here, from all of you.
    The positions you hold at your organizations are at the highest
    level, and I know that your schedules are very demanding, so we
    really appreciate you being here. And I think it demonstrates
    the importance of what we are talking about here today.
        Your companies and workers depend on the functionality of
    our transportation system networks, so your perspectives are
    critical to helping us shape the future of America's
    infrastructure.
        And with that, I would now like to yield to recognize the
    ranking member, Mr. DeFazio, for a statement.
        Mr. DeFazio. Thank you, Mr. Chairman. I very much share the
    sentiments you have expressed. I was interested to learn that
    the first earmarked highway project in America did run through
    your district.
        [Laughter.]
        Mr. DeFazio. So that is--hopefully we can----
        Mr. Shuster. It wasn't my father.
        [Laughter.]
        Mr. DeFazio. We can--is that the one they named after your
    dad? OK. And I hope we can bring back congressionally
    designated spending, where we set priorities for some small
    amount of our annual investment. We know our districts and our
    States better than Washington, DC, bureaucrats of either party.
        I also agree with your sentiment about challenging the
    status quo. I am going to talk about that now. The status quo
    has been, we are frozen in amber. We are refusing to invest in
    our infrastructure. Yes, the FAST Act was good. But part of it
    is paid for with funny money that will never show up because we
    didn't have the guts here to increase user fees.
        It is time to confront these issues. The American people
    get it. A number of all-red States have raised their gas tax.
    Nobody has been recalled or lost their election. The people get
    it. They are tired of sitting in congestion. So I am going to
    talk about real things.
        OK. Let's index the gas tax--radical proposal. We can index
    it to construction cost, inflation, fleet fuel economy. Gas
    will go up maybe 1.2 cents a gallon next year. Anybody think
    they are going to lose their election over that?
        But if we do that over the next 30 years, we can issue 30-
    year bonds, tranched. We tranche the bond issuance of $500
    billion, which would mean $20.3 billion additional per-year
    expenditure, and we would make the Highway Trust Fund whole
    through the next three authorizations, and we would bring the
    Nation's infrastructure to a state of good repair in 14 years.
        And I think that's what the President called for last week
    in Philadelphia. He said, ``Fix it first.'' We do need to fix
    it first. We need to fix the 140,000 bridges that are falling
    down. We need to fix the 60 percent of the pavement on the
    National Highway System that doesn't just need another coat of
    asphalt, it needs to be totally restructured. And we need to
    deal with the $90 billion backlog in our transit systems, just
    to bring them up to a state of good repair, let alone offer new
    options.
        My plan would both allow us to bring it up to a state of
    good repair in a reasonable period of time, and to make new
    investments because it would make the Highway Trust Fund whole.
    That is all we would have to do, just index the gas tax,
    dedicate it, and issue the 30-year bonds.
        Now, second, let's talk about, again, a little bit of
    political will. We are collecting a tax every day from every
    American consumer who buys any imported good. They are paying a
    tax. And that tax is supposed to go to maintaining the Nation's
    harbors. Well, it isn't. Half the money, about, on an annual
    basis, goes into harbor maintenance work.
        That is why we have a $22 billion backlog to be able to
    accommodate the new ships, in addition to funds needed for
    failing jetties and other things. We are only spending half of
    the tax the American people pay every day. Every year. The rest
    of it is being diverted into la-la land. It is pretend deficit
    reduction. It is theoretically sitting in a $9 billion account
    in the Treasury.
        If we waive the House budget rules, and we spend that $9
    billion--which we took from the American people--for the
    purpose for which it was intended, and spend the full tax every
    year for the next 10 years, we could invest $27 billion in our
    harbors. That means they would be ready to receive the big
    ships, we would take care of that $22 billion shortfall, and we
    could repair the jetties and make other improvements. That
    money is already available.
        We don't need a new tax, we just need to push the Budget
    Committee objections and some of the appropriators out of the
    way and say no, we are going to make it into a real trust fund,
    like we have for surface, and we are going to actually spend
    the tax for the purpose for which it is collected. Now, all
    that takes is a little bit of a challenge to the status quo.
    You don't even have to raise a tax.
        And then, third, our airports are in serious trouble: $32.5
    billion backlog to accommodate growing passenger demand. You
    have all been there. You have gone through what are essentially
    Greyhound bus stations instead of state-of-the-art terminals.
    Now, we haven't allowed them to increase the passenger facility
    charge. I have talked to all the airports.
        The largest airports have said to me, ``Look, let us raise
    the passenger facility charge, a user fee only on people who go
    through that airport, and we will forgo the AIP [Airport
    Improvement Program]. You can give that money to the small and
    moderate-sized airports, so they can do needed projects, and we
    will pay for our own projects with bonding, by dedicating an
    increase in the PFC [Passenger Facility Charge].'' Many of
    these airports are bonded out.
        Now, the airline industry says, ``Oh, if you increase the
    PFC by $2, nobody will ever fly again. They will all get in
    their cars.'' Oh, you can charge me $50 to put my bag in the
    overhead, and I will keep flying and smiling. But if I had to
    pay $2 so I don't have a Greyhound bus experience when I go to
    fly on an airplane and stand in these unbelievable lines
    because we have inadequate capacity, I won't ever fly again? I
    mean that is total B.S. We all know that. They have some
    economist somewhere locked in a closet who claims he can prove
    it. What they are afraid of is if airports expand we might have
    more competition. If we have more competition, that might mean
    that prices of tickets go down. That is the real reason that
    they object.
        So that takes a little political will. So here are three
    steps we could take to put nearly $600 billion to work, some of
    it tomorrow. Remember, there is a provision in the FAST Act
    that I got in there that says any additional funds allocated to
    transportation spend out immediately through the formulas we
    have already adopted. We don't have to go through a multiyear
    process, we don't have to go through debates, or anything else.
    I would hope that we would add in congressionally designated
    spending for some portion of these new projects. But, other
    than that, no other changes are necessary.
        The Harbor Maintenance Trust Fund, waive the House budget
    rules, spend the money we have taken from the American people.
    And, yes, stand up to the airlines and say, ``Look, come on,
    you know, we want people to have a good experience both in the
    air and on the ground. Let's rebuild America's airports to meet
    the additional demand with a small addition on the passenger
    facility charge.''
        Now, passenger facility charge is in the jurisdiction of
    this committee. Harbor Maintenance Trust Fund is a shared
    jurisdiction, obviously. And then, of course, the indexation of
    the gas tax would have to be approved by our colleagues on Ways
    and Means. But I think if we joined together--like we did when
    we got an increase in the gas tax over the objections of many
    in Congress by having a bipartisan coalition to increase the
    gas tax in 1993, the last time it was increased--we could do it
    again. I hope that we can join and make common cause in these
    areas, because we do need to rebuild our country.
        Thank you, Mr. Chairman.
        Mr. Shuster. Thank you, Mr. DeFazio. And now I would like
    to welcome, again, our panelists. Thank you for being here. I
    will introduce you now in group, and then start the testimony.
        But first off, Mr. Fred Smith, who is the chairman, CEO,
    and founder of FedEx Corporation. FedEx is a Fortune 500
    company with over $50 billion in annual revenue. FedEx moves 12
    million packages daily through the global transportation
    system, which gives them great perspective on the challenges
    that we faced.
        Next, Mr. David MacLennan--Lennon, like Lennon, John
    Lennon, there. Good job, Cohen.
        [Laughter.]
        Mr. Shuster. Sorry about that. Chairman and CEO of Cargill,
    Incorporated. Cargill is the largest privately held corporation
    in the United States, producing food, agricultural, financial,
    and industrial products throughout the world. Cargill exports
    more than 200 million tons of dry bulk cargo each year, and it
    is a $120 billion-a-year corporation.
        Mr. Ludwig Willisch, president and CEO of BMW America. BMW
    has invested over $7 billion to build and upgrade its
    manufacturing plant in Spartanburg, South Carolina, which
    employs nearly 9,000 people. Since it opened in 1992, American
    workers have produced 3.7 million vehicles, exporting 85
    percent of them through the Port of Charleston.
        And next, Ms. Mary Andringa, chairman of the board of the
    Vermeer Corporation, based in Pella, Iowa. Vermeer manufactures
    and distributes agricultural, forest, and utility equipment to
    over 500 of its global dealerships. It exports 30 percent of
    its parts worldwide, and annual sales of over $1 billion.
        And finally, Mr. Rich Trumka, president of the AFL-CIO. The
    AFL-CIO is the umbrella organization for over 50 U.S. unions
    representing 12.5 million working men and women. And, of
    course, a fellow Pennsylvanian. Welcome to each and every one
    of you, and I look forward to your testimony, and looking
    forward to working with you as we move forward.
        I now ask unanimous consent that our witnesses' full
    statements be included in the record.
        Without objection, so ordered.
        And since your written testimony has been part of the
    record, we would ask you to limit your oral testimony to 5
    minutes.
        And with that, we will start with Mr. Smith. Please
    proceed.
        Mr. Smith. Thank you, Mr. Chairman.
        Mr. Shuster. I don't think your mic is on. Is it?
        Mr. Smith. Yes, it is now.
        Mr. Shuster. Pull it a little closer to you, maybe.
        Mr. Smith. Is that better? OK.
        Mr. Shuster. There you go, thanks.
        Mr. Smith. I served in the Marine Corps, so I have to be
    instructed carefully.
        [Laughter.]

     TESTIMONY OF FREDERICK W. SMITH, CHAIRMAN AND CHIEF EXECUTIVE
     OFFICER, FEDEX CORPORATION; DAVID W. MACLENNAN, CHAIRMAN AND
        CHIEF EXECUTIVE OFFICER, CARGILL, INCORPORATED; LUDWIG
     WILLISCH, PRESIDENT AND CHIEF EXECUTIVE OFFICER, BMW OF NORTH
        AMERICA; MARY V. ANDRINGA, CHAIR OF THE BOARD, VERMEER
        CORPORATION; AND RICHARD L. TRUMKA, PRESIDENT, AMERICAN
     FEDERATION OF LABOR AND CONGRESS OF INDUSTRIAL ORGANIZATIONS
                               (AFL-CIO)

        Mr. Smith. So, thank you, Mr. Chairman, Mr. DeFazio. Let me
    say hello to a couple of old friends, Representative Cohen, who
    represents our hometown headquarters, and Representative
    Duncan, from the more prosperous eastern part of our State. So
    it is good to see you.
        As you mentioned, my written statement is in the record. So
    let me make a few points. I think at FedEx Corporation we are
    uniquely situated to comment on these matters. I am proud to be
    here representing over 450,000 FedEx team members around the
    world. We have four transportation companies that are affected
    by these infrastructure questions: FedEx Express, the largest
    all-cargo and express air carrier in the world; FedEx Ground,
    the second largest ground parcel network; and FedEx Freight,
    the largest less-than-truckload system in the United States;
    and finally, FedEx Trade Networks avails itself of the maritime
    transportation.
        We serve 220 countries, link 99 percent of the world's GDP,
    operate 650 aircraft, serve 375 airports, operate 150,000
    motorized vehicles. As you mentioned, we move 12 million
    shipments on average per day in the nonpeak season. We fly 255
    million miles each year. And last year FedEx vehicles drove in
    excess of 5 billion miles on our highways. We strongly support
    a modernized transportation system that includes the best air
    traffic control system, updated sea and airports with the
    latest in technology, and well maintained and expanded highway
    systems.
        So let me talk briefly about all three of those. Improving
    the ATC system, ensuring transparency and the payment for that
    system, and assuring irrelevant provisions are not added to the
    legislation should be priorities of this committee. We support
    an independent ATC system, and believe that such an enterprise
    will work more effectively and efficiently than the current
    one. The new ATC system must be allowed to operate as a bona
    fide stand-alone business organization separate and apart from
    the Government and responsible to its users.
        Regarding the interstate road system, our interstate system
    is now over 60 years of age. It is in desperate need of
    updating. Nearly 70 percent of all freight tonnage moved in the
    U.S. moves on trucks. I think you mentioned that, Mr. Chairman.
    We need both short- and long-term investment. The surface
    transportation industry has been virtually unanimous in
    supporting an increase in the Federal system to pay for this
    system. First, through the gasoline and diesel system, and
    moving to a user fee system, given the emergence of noninternal
    combustion engines in the form of electric and hybrid vehicles,
    some of which we are operating in Washington, DC, as we sit
    here today.
        And lastly, we strongly support a new Federal standard to
    move the twin trailer limits in this country from 28 feet to 33
    feet for the less-than-truckload and ground parcel businesses.
    Quite frankly, these networks are being overwhelmed with the
    growth in e-commerce. Thirty-three-foot twin trailers are
    permitted in certain States. We have operated them for many
    years. They are safer, save millions and millions of gallons of
    fuel, reduce emissions. They take vehicles off the road, which
    gets to the congestion issue that you were talking about, Mr.
    Chairman.
        I might point out that the standard in Mexico is twin 40-
    foot trailers. So this is not a big stretch. This would have an
    instant improvement, environmentally and in the national
    productivity in our less-than-truckload and ground parcel
    networks.
        Let me just close with saying to you there has been a lot
    of conversation in Washington these days about trade. FedEx is
    ardently in support of expanded trade, not less trade. We
    certainly acknowledge the protectionism and mercantilism,
    particularly in China. But the secret to that is to expand our
    access to their market, not shut down the trading system that
    has made this country so prosperous.
        Thank you for giving me the time to make these remarks.
        Mr. Shuster. Thank you, Mr. Smith. Now, Mr. MacLennan.
        Mr. MacLennan. Chairman Shuster, Ranking Member DeFazio,
    and distinguished members of the House Committee on
    Transportation and Infrastructure, I appreciate the opportunity
    to be here today. I am Dave MacLennan, I am chairman and CEO of
    Cargill. We provide food, agriculture, financial products and
    industrial products to the world, and our mission is to nourish
    the country and nourish the world in a safe, responsible, and
    sustainable way.
        Our company is a great American success story. It was
    founded in 1865 by William W. Cargill, with one small grain
    warehouse in Conover, Iowa. That elevator almost went bankrupt
    just a few years later, when the railroad stopped coming to
    Conover. Mr. Cargill knew that transportation drives growth in
    agriculture. So he followed the infrastructure. And today we
    have 150,000 employees in 70 countries around the world.
        Thank you for your past leadership on reauthorization of
    WRDA, and--as well as the passage of the FAST Act. I am
    encouraged by the interest of this committee in modernizing our
    Nation's infrastructure, and eager to discuss the challenges
    facing our agriculture support system.
        For much of our history, America's infrastructure has been
    the envy of the entire world. It has allowed our country to
    become the economic powerhouse that we are today. And certainly
    for agriculture in the rural communities which serve
    agriculture, moving product for trade and export is critical.
    But while many other countries are building the roads, ports
    and railways of the future, we are falling behind.
    Infrastructure investments will allow American companies to
    compete effectively with our counterparts abroad and create
    long-term growth that will benefit and create jobs for all
    Americans.
        Twenty-first-century infrastructure includes shiny objects
    like electric cars and microgrids and high-speed rail. But as
    exciting as those new technologies are, we also need to think
    about our traditional transportation assets. So my testimony
    will focus not on the shiny objects, but on the ones that can
    get rusty, like rails, roads, bridges, and the waterways of
    rural America.
        Mr. Chairman, agriculture is the largest user of freight
    transportation in the United States, claiming 31 percent of all
    ton-miles, according to the USDA. And in our world of thin
    margins, when infrastructure fails it ripples up the supply
    chain, and we all feel it.
        Cargill supports multiple modes of transportation. What is
    most important to us is making sure our customers can get their
    goods from point A to point B in an efficient, safe, and
    sustainable manner. Unfortunately, our Nation's transportation
    infrastructure is under unprecedented strain. Our inland
    waterways struggle because of aging locks and growing demand.
    Our seaports are not deep enough to accommodate newer and
    larger ships. Our railroads are experiencing capacity
    constraints, and our bridges and roads are crumbling, receiving
    a D rating from the American Society of Civil Engineers.
        If our ports fail, we cannot link Pacific Northwest grain
    farmers to the global market. If our locks and dams fail, we
    can't move the road salt that we mine in Louisiana up the
    rivers to keep roads safe in the winter in Pittsburgh. If our
    bridges crumble we cannot cost-effectively truck fertilizer to
    family farmers in Platte City, Missouri. And if our railroads
    are over capacity, we can't ensure enough ethanol makes it to
    New Jersey to be blended into gasoline for our cars.
        We know what it looks like when one mode of transportation
    fails and the consequences ripple up the supply chain. In 2005,
    when Hurricane Katrina shut down the gulf ports, we lost the
    ability to transport grain on our Nation's waterways. Losing
    this very efficient transportation capacity greatly impacted
    the price of corn paid to farmers, with U.S. corn prices
    falling 30 cents a bushel. In 2005, the U.S. corn crop was 10
    billion bushels, so that is $3 billion in lost market value at
    the time.
        In the chairman's home State of Pennsylvania, crumbling
    bridges near our beef plant in Wyalusing were recently bypassed
    for replacement. Reduced weight limits made them impassable for
    our carriers. And in the rural town where we employ more than
    1,700 workers, trucks moving beef to our customers, are focused
    to reroute, which adds millions of dollars in cost to our
    business today.
        So, in closing, our ability to fix our infrastructure,
    compete in the global market, and keep our economy growing will
    be influenced by the decisions of the people in this room. I
    urge you to invest in the food and agriculture and rural
    economies by reinvesting in the state-of-the-art transportation
    systems that we all know clearly got us here in the first
    place.
        Thank you again, Mr. Chairman, for the opportunity to share
    Cargill's views with you today, and I look forward to answering
    your questions.
        Mr. Shuster. Thank you.
        Mr. MacLennan. You are welcome.
        Mr. Shuster. Mr. Willisch, you may proceed.
        Mr. Willisch. Thank you, Chairman Shuster, and Ranking
    Member DeFazio, and members of the committee, for inviting me
    to participate in today's hearing. My name is Ludwig Willisch,
    and I am the head of the Americas for the BMW Group. I
    represent the more than 70,000 people who have jobs provided
    and supported by BMW in the U.S. alone. This includes 655
    dealerships across 48 States; 11 distribution centers in 8
    States; our headquarters in New Jersey; design studio, tech
    office, and testing facilities in California; a bank in Utah;
    financial services in Ohio; BMW Technology Corporation in
    Chicago; our carbon fiber manufacturing facility in Washington
    State, and BMW Manufacturing in South Carolina.
        Over the last two decades we have invested $7.5 billion in
    our South Carolina plant, now the largest facility in our
    global network. What is more, this plant earns BMW the title of
    the largest exporter of vehicles in the United States by value.
    We estimate that BMW had around $10 billion in U.S. dollars to
    export last year, alone.
        We have a talented team and achieve much within our
    company. However, no one in this industry can go it alone.
    Every auto company relies on a network of suppliers, service
    providers, reliable infrastructure, and the right regulatory
    framework to deliver for our customers. In this spirit, I would
    like to give you a sense of how important these issues are
    through BMW's eyes.
        The current BMW X3 was designed by an American, Erik
    Goplen, out of our Los Angeles design studio, Designworks. Once
    the design was finished, it was sent to Munich for engineers to
    take the car from page to pavement. The next step is production
    in the United States. Our logistics network in South Carolina
    includes 40 nearby suppliers, the Greer Inland Railway Port,
    and the Greenville-Spartanburg Airport. We rely on these roads,
    rails, and runways every day.
        A finished X3 leaves the plant by rail, with the majority
    heading to the Port of Charleston for international export to
    140 countries. On this point I would like to give special
    thanks to the committee, and in particular Chairman Shuster and
    Ranking Member DeFazio and Representative Sanford of South
    Carolina, for their support of the Water Resources Development
    Act. The Port of Charleston is absolutely critical to export
    success of BMW and a number of other companies.
        The remainder of the domestic vehicles are trucked to BMW
    vehicle distribution centers in States across the country. From
    those distribution centers, the X3 is then delivered to dealers
    in 48 States. Reliable transportation and infrastructure is
    vital to operating our business every day. Looking ahead at
    future mobility technologies, infrastructure becomes all the
    more important. Industry is making significant investments in
    automated vehicles, or AVs, to move them from test track to
    street.
        There are ways for the Government to support these efforts.
    Some of these opportunities are fairly straightforward. For
    example, the sensors and cameras in automated vehicles rely,
    among other things, on road markings and signs to orient and
    drive. Consistent AV performance can suffer if roads do not
    have adequate lines, road conditions are unpredictable, or
    signs and signals are all different. Consistent performance is
    vitally important, as it lays the foundation for customer
    trust.
        Other areas of necessary Government support are more
    involved, but crucial to the long-term success of AVs. BMW
    welcomed the Federal AV Policy Guidelines as a positive first
    step in creating a regulatory framework for AVs. Industry
    regulators and the public need to continue meaningful
    conversations to move forward. There is a lot of work to be
    done. But with so many stakeholder groups aligned on the
    desired outcomes, I am confident we can find a path forward.
        This is an opportunity that requires all stakeholders to
    bring their best ideas and open minds to the table. I look
    forward to continuing our conversation and working together to
    make tomorrow's potential a reality.
        Thank you very much.
        Mr. Shuster. Thank you.
        Ms. Andringa, please proceed.
        Ms. Andringa. Thank you, Chairman Shuster and Ranking
    Member DeFazio and members of this committee, for hearing a
    little bit about what it means for manufacturers to have an
    updated infrastructure system.
        Our company, Vermeer, was started 70 years ago by my dad,
    with one employee, one product, and really, distributing
    products locally. Today we have over 2,000 employees and 160
    different products. And I realize those numbers are small in
    comparison to my fellow board members and panel members here,
    but, you know, it represents, really, a lot of small and
    medium-sized businesses.
        In our country, 50 percent of GDP and over 50 percent of
    employment is connected with small and medium-sized businesses.
    And so, what my dad needed for infrastructure back in 1948 is
    different than what we need today. And as chair of Vermeer and
    former CEO, I have also had the opportunity to chair the
    National Association of Manufacturers, which represents 12
    million men and women who manufacture every day. When I first
    became involved with the NAM, we talked about how our goal was
    that the U.S. be the best place to manufacture. And in order
    for it to be the best, we need to have good, top-notch
    infrastructure. It has been at the top of our list for many
    years.
        So, in a company like ours, when we bring over 2,000 people
    in from anywhere from 30 to 70 miles' driving distance one way
    every day, we need safe, reliable roads for them to get to work
    safely, and also to be able to get home safely to their
    families.
        We also have 50 trucks, which ride every day into Vermeer
    with parts and pieces and go out as whole goods. So we need the
    good roads for that. Of the major roads in the U.S., 65 percent
    are deemed deficient. And also, I think we have to understand
    that road conditions often are a significant factor in
    fatalities on our roads.
        We also have hundreds of sales and service people who work
    with our distribution networks who are in urban areas, and they
    are dealing with congestion, particularly in the urban areas,
    and traffic delays, and sometimes a lot of frustration getting
    trucks in and out of the urban areas to our dealerships and to
    our customers.
        One of the things I thank this committee for is the work
    that you did on the FASTLANE grant. Because of that, we are
    going to now have an intermodal location in Cedar Rapids, Iowa,
    which is much closer to us than trucking containers to Chicago
    or Kansas City. That will help relieve some congestion that we
    have had in getting containers to ports.
        Bridges have been mentioned before, but I know just in
    Iowa, 21 percent of bridges in Iowa are deemed deficient. So
    again, it is a safety and a congestion and delay opportunity
    that we can fix.
        Airports are definitely in dire need of updates. We ship
    400 to 500 packages to our customers daily with air. We also
    buy a lot of commercial tickets, over 3,000 a year. And yet we
    have a lot of frustration with delays and airports. And I think
    some of the work that needs to be done yet on the longer term
    Federal Aviation Administration authorization bill is extremely
    important. Air traffic controllers are, in many cases, working
    without data and technology. And also, as we look at that
    NextGen implementation, the estimates are that that would be
    able to reduce delays by 35 percent, which would be
    significant.
        Manufacturers use energy, all kinds of energy. So it is
    very important that we have good and solid transmission lines.
    And it is really the internet of everything. So it's the way we
    communicate with our customers, with our dealers, with our
    employees in the United States and around the world, that makes
    broadband infrastructure so important.
        And it is also important because today we have smart
    machines in our factories. We also have smart machines out on
    job sites. And many times they are communicating with the asset
    owners.
        Over the last years, Vermeer has been involved in
    continuous improvement, or the Lean journey. And one of the
    things with Lean is you need to have flow. So you need to have
    flow of goods coming in on a timely basis, and you need to have
    whole goods going out on a timely basis.
        But another aspect of Lean is total productive maintenance.
    And I think that one has some applications to infrastructure.
    It is when we take a machining center, maybe a $1 million
    machining center, and periodically tear it down to the parts
    that are going to fail--we know they are going to fail--and we
    replace them. And the result is that we reduce our downtime on
    those machines, like, 70 percent, and we also reduce our cost
    of maintenance. And it seems to me that manufacturers know a
    lot about investing in our infrastructure to make sure we have
    a sustainable future. And I think that is the same kind of
    investment, proactive investment, we need in our infrastructure
    system in the United States.
        So, I would just like to say that this discussion has been
    going on for quite a while, and I really implore you all to
    take some major steps. We need a sustained, focused effort to
    really reverse the decline, and to make sure we have the
    infrastructure that we need to produce safe transportation,
    productivity, and also great jobs here in the U.S.
        So, thank you for the work your committee does.
        Mr. Shuster. Thank you. Now Mr. Trumka, please proceed.
        Mr. Trumka. I thank you, Mr. Chairman, Ranking Member
    DeFazio, members of the committee. It is a pleasure to be here
    with you today. This committee is known for working together
    and setting aside partisan differences and getting things done
    for the good of the country, and I want to thank you for that.
        In recent years you have passed many pieces of important
    legislation, and this year will bring FAA reauthorization, and
    hopefully a major new infrastructure bill. Our Nation faces
    challenges that are gray, and the task ahead is very daunting.
        We are all familiar with the American Society of Civil
    Engineers estimate that our infrastructure deficit is
    approaching $4 trillion. Yet closing that gap is only the first
    step. The reality is our infrastructure is rapidly becoming
    technologically obsolete. To truly be competitive in the 21st
    century, we must invest in the transformative infrastructure of
    the future: this century's version of the transcontinental
    railroad and the National Highway System.
        Our failing infrastructure may be an obstacle and a
    challenge, but fixing it is really a powerful opportunity.
    During his campaign, President Trump spoke about $1 trillion in
    new infrastructure investment. We believe that is the right
    scale to be talking about, trillions. And the labor movement is
    ready to work with this committee to turn words into actions.
        Look at this panel before you. Business and labor may not
    agree on a number of things, but we do agree on the need for
    serious investments in America's infrastructure. In the
    aftermath of the 2016 election, there is no clearer mandate
    from the American people. And it should surprise no one that
    infrastructure is a top issue, because the American people have
    endured an infrastructure that has been underfunded and
    crumbling for decades. We want investments that create good
    jobs, that meet the real needs of our economy. Any other path
    takes us backwards, because investments in infrastructure
    create the foundation for a long-term growth.
        Building the infrastructure of the 21st century is vital to
    both our Nation's competitiveness and to the hopes of
    hardworking people to lead better and more prosperous lives. So
    the labor movement is ready to fight here in Washington and
    across our great Nation to see a transformative and inclusive
    infrastructure program enacted. We need to bring 21st-century
    technology and good jobs to the entire country, to places as
    diverse as West Baltimore and my rural hometown, Mr. Chairman,
    of Nemacolin, Pennsylvania.
        And once that investment is made, the labor movement stands
    ready with the most highly skilled and well-trained workforce
    to get the job done. One trillion dollars in new infrastructure
    investment would make a big difference to working Americans,
    and put our Nation on the path to sustainable prosperity. How
    we invest matters. It must be real investment, and it must
    create good jobs.
        And let me be clear. If we want good jobs, we have to have
    high labor standards and protections for people who build and
    maintain and operate our infrastructure.
        That is not all. We need to make sure public money is used
    to support American jobs, American resources, and American
    products.
        Finally, it is imperative that we invest at the lowest cost
    of capital to the public. Anything else simply sacrifices jobs
    to Wall Street. So, finding significant sources of funding may
    be politically difficult. But the cost of inaction is
    unacceptably high. And it is real, and it is growing. Labor has
    and will continue to consider all types of funding, including
    our traditional support of user fees to fund surface
    transportation. Done right, other resources or sources of
    revenue could help. However, solving our Nation's vast
    infrastructure needs will require major levels of public
    investment.
        I will be blunt, Mr. Chairman, we need to be bold, and we
    need to be aggressive. We need to be the America that can, not
    the America that can't. We are eager to work with the leaders
    of both parties to make this investment a reality and help cure
    some of the problems that the country faces and my colleagues
    at this front table face. We stand ready to do that, Mr.
    Chairman.
        Mr. Shuster. Thank you very much. Now we will go to
    questions. I will start, and I want to direct it at Mr.
    Willisch and Mr. MacLennan.
        I appreciate that Ms. Andringa was very specific on
    projects that affected her business. Both of you made reference
    to it, but as we are looking at the 21st-century
    infrastructure, what in your world of Cargill and BMW--what are
    the specifics? Where do we need to invest for manufacturers
    like you to be successful and to continue to grow?
        Mr. Willisch. Well, very obviously, the first thing is
    roads. That is where our cars are operated. And that includes,
    as I said before--because we are on the verge of a big change,
    as far as drive trains are concerned, as far as automated
    driving is concerned. So road markings are really crucial to
    the working of an automated car.
        The second thing is, of course, when it comes to
    infrastructure, it is the ports that really matter to us, which
    we need to both send cars into 140 countries from this country,
    or receive parts and stuff that we need to build those cars
    with. So those two things are really, really crucial to us.
        Mr. Shuster. And to your bottom line, if that port isn't
    efficient, if that port can't take those bigger ships coming in
    to Charleston, that affects your bottom line.
        Mr. Willisch. Absolutely. And just think. We just dredged
    the harbor of Charleston so it can have bigger ships that can
    go through the new Panama Canal, because all cars that we ship
    to Asia go through the Panama Canal.
        Mr. Shuster. Right.
        Mr. Willisch. So it is really vital to us.
        Mr. Shuster. And one thing is you've mentioned about the
    number of cars you export. According to what I see, you export
    more cars than General Motors.
        Mr. Willisch. Yes. Yes, we do.
        Mr. Shuster. And producing----
        Mr. Willisch. Who would have thought?
        Mr. Shuster. Yes, exactly.
        Mr. MacLennan?
        Mr. MacLennan. Mr. Chairman, yes, I mean, it is kind of
    like your kids, you don't want to pick one over the other, and
    we use highways, we use railcars, we use barges, and they are
    all interconnected. I mean, you know, you have a bit of a
    disruption in one, it flows back through the supply chain.
        I would say, relative to our business, and especially our
    focus in the rural economy, in the agricultural economy, I
    think rivers, ports, the waterways, they are environmentally
    efficient. They can carry bulk. They can only go so far,
    obviously. You know, they are limited.
        But I think, you know, rivers and ports and the access to
    the grain and the things that we move up and down, the products
    that we move up and down, we moved 97 different products on the
    river system in the last year.
        And the other statistic that I found rather staggering is
    that in the last year our Nation's locks were closed for over
    141,000 hours. So if you think about the disruption to the
    system--call it the backward ripple effect in the supply
    chain--I think I would probably focus on, for us, waterways,
    locks, the river system as being important.
        Mr. Shuster. And that has a huge impact on your bottom
    line.
        Mr. MacLennan. Significant impact on it, huge impact on our
    bottom line and the bottom line of our customers.
        Mr. Shuster. All right, which is the point of if you don't
    pay for it in the front end, you are going to pay for it on the
    back end.
        Mr. MacLennan. Exactly. Pay me now or pay me later.
        Mr. Shuster. Right, right.
        Mr. Smith, you have the broadest use of the transportation
    system. We are in the 21st century. You know, should we be
    really targeting--and if we had to--if you had to pick one or
    two that really have a huge impact on what you do in the States
    and globally, which modes would you think are the most
    efficient?
        Mr. Smith. Well, as I said in my remarks, Mr. Chairman,
    modernize the ATC system, expansion and the maintenance
    upgrades of our Interstate Highway System. There are 28
    interstate highway projects that are basically engineered and
    could move forward if the funding was there to do them.
        I don't think there is any question about the fact that
    President Eisenhower in the 1950s, launching the Interstate
    Highway System was one of the most important things that led to
    the prosperity of this country. And we are simply not expanding
    it and maintaining it to the extent that we need to.
        And, of course, I mentioned the--you don't have to do
    anything in terms of funding to approve the 33-footers. Those
    are the three things that we think would have profound and
    near-instant improvements in the Nation's infrastructure.
        Mr. Shuster. And improve your bottom line, which helps
    reduce the cost to customers, ultimately.
        Mr. Smith. Well, it improves our bottom line. And the thing
    that is just the nemesis for many parts of the country, the
    congestion continues to increase. And absent these investments
    in the infrastructure, that is not going to stop. So it is
    going to get worse and worse. And I--the--Mr. DeFazio's
    remarks, I think, were spot on. I mean we have got to pay for
    it, and get started on it.
        Mr. Shuster. Thank you very much. With that, I will yield
    to Mr. DeFazio for questions.
        Mr. DeFazio. Thank you, Mr. Chairman. Mr. Chairman--and it
    was just mentioned by Mr. Smith and others referred to it--the
    cost of congestion. So I have taken it upon myself to create an
    infrastructure cost of congestion clock, which I have posted on
    the Democratic side of the website. Hopefully it could be on
    the full committee site.
        And for reference purposes, since this President has
    promised that he wants a major infrastructure plan, is
    expressing some frustration that it doesn't seem to be at the
    top of the agenda, I want to reinforce that. And this clock
    will recognize, on a daily basis, the cost of congestion to the
    American economy.
        And, as you can see, it is running right now. And this is
    since the day the President was inaugurated. So I share the
    President's frustration, and hope that this committee can raise
    these issues to the top of the agenda, or the 100-day agenda.
    This reflects the cost, both to individuals and to business, in
    terms of congestion and delay. And, just for average people, it
    is 84 minutes stuck in traffic since the day of inauguration
    because of undue congestion.
        With that, let me go back to my proposal. Is there anybody
    on the panel--and now, Mr. Trumka, you represent millions of
    individuals, so you can speak for them. And all the rest of you
    are in business, and use fair amounts of fuel directly or
    indirectly in moving your goods or in moving goods. Does
    anybody here think that a one-half of 1 percent increase in the
    cost of diesel would cause an undue disruption to the American
    economy, or a taxpayer revolt that would threaten people's
    political careers? Because that is what my plan would do. It
    would be about one-half of 1 percent, if we index the per-year
    increase.
        So, OK, that is great. And I think, when you look at that
    number, it looks like a pretty darn good investment.
        I would like to go back also to the harbor issue. We have--
    and probably, even Ms. Andringa, you probably import or export
    goods, too--so I think we have four people here directly
    involved in the import or export of goods, and some frustration
    about that.
        If you are importing goods, you are paying the tax. And I
    am just wondering, what do you think of the proposal that we
    should actually take the taxes that were collected to maintain
    our harbors and do away with this artifice of putting them in a
    theoretical bank account at the Treasury, and actually spend
    them to deepen and improve our harbors. Anybody got any
    reflection on that?
        Mr. MacLennan. I will take the bait.
        Mr. DeFazio. Yes.
        [Laughter.]
        Mr. MacLennan. So you said it effectively in your opening
    remarks, Congressman. I mean we have got this money that has
    been collected. We have paid it, it is there, and we need it.
    So, obviously, you want to get good, effective, scalable
    projects. But, you know, given what is--I mean, for example,
    the expansion of the Panama Canal, we are seeing more traffic
    on our riverways. I talked a few moments ago about the need for
    more efficient river traffic. It is environmentally efficient.
    And you can get over 50,000 bushels on 1 barge, and you can get
    1,000 bushels on a regular-sized truck.
        So, I would support your proposal to spend the money,
    invest the money that has been collected from the users of the
    system.
        Mr. DeFazio. I would reflect that Congress did--although
    most don't know it--increase the inland diesel waterway user
    fee, diesel tax, in a yearend budget deal 2 years ago. Kind of
    had to hide it. We had advocated for that, but were shut down
    as we went to the floor. But later it got snuck into the
    yearend budget deal. It made a lot of sense. And this--in this
    case, we don't have to increase it, we just have to spend the
    money as it comes in, and spend the money that has been
    accumulated.
        Mr. Smith, you referenced 20 projects. Were those major
    choke points that you said were already designed?
        Mr. Smith. Yes, sir. I have a list of them right here:
    North-South corridor, Missouri, Arkansas, Louisiana, U.S. Route
    220, Pennsylvania, New York, Raleigh, Norfolk corridor, North
    Carolina and Virginia, I-69 corridor, U.S. Route 59. They are
    all right there. The DOT, if you put a funding mechanism, you
    can----
        Mr. DeFazio. What are the----
        Mr. Smith [continuing]. Get started on them right away.
        Mr. DeFazio. What do they add up to? Did you add them up,
    by any chance, or----
        Mr. Smith. In terms of money?
        Mr. DeFazio. Yes, cost.
        Mr. Smith. I don't have the----
        Mr. DeFazio. OK.
        Mr. Smith [continuing]. Dollars invested here. But just the
    route extensions that would improve the national productivity,
    reduce congestion.
        Mr. DeFazio. Sure, thank you. OK. And, Mr. Trumka, some
    people question, say, ``Well, gee, we really don't have the
    people to support and do the work, if we make these major
    investments. There just aren't enough workers out there.'' I
    mean, look, the unemployment rate, theoretically, is down to 4
    percent.
        Could you reflect on that, whether or not there is a ready
    and trained and available workforce if we did a major
    infrastructure push?
        Mr. Trumka. I would be happy to. According to the latest--
    the latest--BLS reports, there are still 670,000 construction
    workers that are out of business. That doesn't include
    discouraged workers who have stopped looking for the jobs. It
    also doesn't include things like design engineering, operation,
    maintenance, and warehousing, which are in a different
    category. All of those are available, as well.
        This is the best-known secret in the United States: other
    than the military, the U.S. labor movement trains more people
    every year than any other institution out there. No university
    does it better. We have highly skilled people. We are putting
    people through those apprenticeship programs on a regular
    basis. We are reaching in to disadvantaged communities, rural
    communities, with classes that will help them qualify, get
    through our entrance exam, and qualify as a career. So there is
    an ample supply of skilled workers ready, anxious, and willing
    to go to work.
        Mr. DeFazio. Excellent, thank you. Thank you, Mr. Chairman.
        Mr. Shuster. Thank you. With that, Mr. Barletta.
        Mr. Barletta. Thank you, Mr. Chairman. Growing up in the
    road construction business, I learned that private industry
    needs long-term planning and dedicated funding sources in order
    to invest in our Nation's infrastructure. It is simply a fact
    that no employer will make plans to hire more workers or
    purchase $1 million pieces of equipment without long-term
    security in Government contracts. And no State or local
    government, being a former mayor, can make long-term plans
    without certainty in Federal transportation spending. Do you
    all agree?
        That being said, can any of you speak to how uncertainty
    and short-term fixes to the Highway Trust Fund have impacted
    your ability to move goods and services around the country?
    Anyone who wants to take a stab.
        Mr. Smith?
        Mr. Smith. Well, as has been brought up several times, the
    population and the commerce of the United States has gone up at
    a far, far faster rate than the expansion of the interstate--
    the Federal highway system, which is the backbone of our
    Nation's logistics system. Seventy percent of every pound that
    is moved in the Nation's commerce is moved on the highways.
    That is not to say other modes aren't equally important, but we
    have allowed the highway system to atrophy for lack of
    maintenance. And, equally important, we have not added to it.
    And that was the point of me referencing these 20 projects that
    are out there that are basically designed.
        So, you can't expect national productivity and economic
    well-being to improve unless you address these infrastructure
    issues. And in my mind it is just a matter of paying for it. I
    mean the system is there.
        Mr. Barletta. You know, spending on infrastructure will
    grow the economy more than anything that I know. When there is
    a lot of infrastructure work, people will make good money.
    There is no question about that. When they make good money, you
    know what they do? They spend it. They spend it right in our
    local economies, which helps everyone, not just the
    construction workers, not just the construction companies, not
    just the manufacturer of equipment. It helps the waitresses and
    waiters and little restaurants and diners. It helps everywhere.
        So, it is an investment. And I said it will grow the
    economy more. So spending on infrastructure is not the same as
    putting money into another program where you are just providing
    services. There is a return on that.
        Mr. Smith. And I might just add I think my numbers are
    correct. We are now at levels of Federal infrastructure
    spending that have not been seen since 1948 as a percentage of
    GDP. So it is going to get worse and worse, unless the Congress
    decides to fund these projects.
        And, as I mentioned, the industry that uses these systems,
    the surface transportation business, has been wholly in support
    of increasing or adjusting the Federal gasoline and diesel
    taxes for years, and replacing them with some sort of new user
    fee system because of natural gas and electric vehicles that
    will use them in the future.
        Mr. Barletta. And I agree, the American people are OK
    paying it as long as they know where it is going, and we make
    sure that every penny that we take from them is used to the
    best that we could.
        Pennsylvania is home to over 120,000 miles of State and
    local highways, many of them which cross through my district. I
    know for a fact of economic development projects that would
    happen if there was access to our transportation system. There
    is no question.
        Can you please explain what role highway accessibility
    plays in determining where you locate your facilities and how
    such accessibility affects your ability to efficiently get your
    goods to the customers?
        Mr. MacLennan. I will start, Representative, and we employ
    about 900 people in your district. We have a chocolate business
    in Lititz, and we also have a beef business. So if you think
    about the traffic that uses the local highways, in terms of
    delivering raw materials, taking the developed product--the
    chocolate, the beef--and moving it on, it is a significant
    consideration. Is it the only one? No.
        And going back to your first comment about do you need
    absolute certainty, no. But it is a world of volatility and
    uncertainty and complexity. It is a significant variable. So I
    would say that we will invest, you know, despite the
    uncertainty, but it certainly would help and encourage us in
    specific locations, knowing there is going to be expanded rail,
    waterway, or highway access. It would attract our capital to
    new investment. Thank you.
        Mr. Barletta. Thank you, Mr. Chairman.
        Mr. Shuster. Thank you, Mr. Barletta.
        Ms. Norton?
        Ms. Norton. May I thank Chairman Shuster for opening this
    year by having--I think he has done this before--this across-
    the-board comprehensive hearing on our Nation's infrastructure.
    And I applaud what this committee has done, very bipartisan
    committee. Not only the WRDA bill, the FAST Act, even when the
    rest of the Congress has not been moving as rapidly in its own
    mission.
        The FAST Act, of course, is the latest version, passed in
    2015. And I think the committee deserves the compliments of the
    committee for passing the first comprehensive highway
    transportation bill in a decade. But I have to tell you that it
    broke my heart that, in order to get even a small bump--that is
    to say an increase, we had to reduce the bill from a 6-year
    bill to a 5-year bill. And, of course, the bill had to contain
    a number of gimmicks, as well. And that is even given the best
    efforts--and I must tell you, extraordinary bipartisan
    efforts--and there was great agreement on this bill.
        The present strategy for our infrastructure is delay. That
    strategy is prohibitively expensive. We are not even doing
    maintenance. So what it means is that billions of dollars that
    those who had the guts before us have invested in our
    transportation infrastructure, which made this country what it
    is today, that that is crumbling, as well.
        So here is something that I championed, and that was done
    with great bipartisan support in the FAST Act. And it is such a
    small amount, it makes me blush. But it can--it is a provision
    that provides $20 million in grants to the States to themselves
    come up with alternative sources of funds for the Highway Trust
    Fund. As you know, the Highway Trust Fund--and I ought to, I
    suppose, give this to Mr. Smith--as you know, the Highway Trust
    Fund has just been stuck now, and we are doing nothing to
    replenish it.
        Mr. Smith, the reason I thought this was a question for you
    is I noted in your testimony something that surprised me. And I
    thought it was important to note that FedEx supports a broad
    mix of revenue sources in order to avoid overreliance--here I
    am quoting you--on a single option. I take it that single
    option is the one we have been using, which, of course, will
    run out even before this bill runs out, the gas tax.
        In light of the fact that we are asking the States to give
    us ideas about alternative sources, can I ask you, Mr. Smith,
    why you think the gas tax alone will not be sufficient? And
    what kind of alternative sources do you think should be put on
    the table so that, even if we were able to get the Highway
    Trust Fund with the gas tax, we would have additional sources
    to get going? Any ideas you have would be much appreciated.
        Mr. Smith. Yes. Well, let me give you three, but let me
    address, again, the Highway Trust Fund. As I have said a couple
    of times now, we at FedEx, and virtually every entity in the
    commercial transportation surface transportation business that
    I know of, supports an increase in gasoline and diesel taxes
    indexed from the cap that was placed on them in 1994. So,
    having said that, here are three issues.
        First, the transportation system is moving away from
    complete reliance on internal combustion engines. There are
    increasing uses of electric and hybrid electric vehicles. And
    in the heavy freight area--I was in Oklahoma recently at the
    ribbon-cutting for our new compressed natural gas facility for
    FedEx Freight. So those two technologies are not captured by
    today's gasoline and diesel system. There needs to be
    something, a vehicle mileage tax or some other mechanism to
    fund use of the Federal highway system by those types of
    vehicles.
        Second, we are strongly in favor of a revised United States
    corporate tax code, because we are not competitive. I think Mr.
    Trumka will agree that blue-collar folks need equipment and
    investment so they can have a high income level. Bulldozers,
    trucks, planes, whatever the case may be. So we are not
    competitive, and we are particularly not competitive with our
    global taxation system.
        There is only one other industrialized country in the
    world, Chile, that has a global tax system. So if we went
    tomorrow to a territorial system with some level of taxation to
    prevent gaming--8 percent, or whatever the case may be--there
    would be hundreds of billions of dollars that could come back
    in this country tomorrow that could provide funding for
    infrastructure.
        And the last idea is congestion pricing. I mean we all know
    today when you go through a bridge or a tunnel in New York, or
    wherever, you don't have to go up and pay somebody taking the
    money. We have a little RFID tag there that says you are paid
    going into Manhattan. That type of technology is cheap, it is
    available. It has been successfully tested down in southern
    Florida in order to reduce congestion by putting congestion
    pricing there, giving you incentives to use high-occupancy
    lanes, or to operate in noncongestion periods of time. That
    could be another source of revenue. So those are three.
        Mr. Shuster. The gentlelady's time has expired.
        Ms. Norton. Thank you, Mr. Chairman.
        Mr. Shuster. With that, Mr. Gibbs is recognized.
        Mr. Gibbs. Thank you, Mr. Chairman.
        Mr. MacLennan, in your testimony you talked about how
    important the locks are in our river system, which I agree with
    you 150 percent. Are you aware--well, let me back up a second.
        We are able to get the Olmsted Lock and Dam project going
    forward. Got kind of off a different funding source that frees
    up money for the Lower Mon, the Kentucky and the Chick locks.
    And you might not be aware, but I am sending a letter today to
    President Trump, along with about two dozen of my colleagues,
    to make sure that they are aware that, in the current funding
    for the Army Corps, the Olmsted is taken care of, but the three
    locks, the three priorities--Lower Mon, Kentucky, and Chick--
    are not.
        And we want to make sure they get the funding here in the
    next few months. Because if they don't, they will be possibly
    shut down and delayed, and the cost will be exponential, and
    going up. So I just wanted to make you aware of that, because I
    know you, especially at Cargill, understand the importance of
    our inland waterway system. So, you know, if you have a chance
    to weigh in with the Trump administration on the importance of
    that funding, I would appreciate that.
        Mr. MacLennan. Yes, thanks for making me aware.
        Mr. Gibbs. I just wanted to mention that.
        Ms. Andringa, in your testimony you talk about, for
    manufacturing too, our water infrastructure--be it our drinking
    water, the aging pipes, and all that--and you talked about
    Representative Duncan's private activity bonds lifting the cap.
    Are you aware that I have a bill that is H.R. 465, dealing with
    integrated planning with the EPA that will help give our local
    municipalities the flexibility in their planning and their
    permits to get to their goals they need to get to but maybe
    can't do it in the 5-year permitting and have a goal which will
    help get the projects done, but it would also be more efficient
    and not--the ratepayers that can't pay that.
        So I just wanted to bring that to your attention, that
    there are some other initiatives going on. I don't know if you
    are aware of it, the EPA's integrated planning, which they say
    they support, but they haven't done a lot to get it going, so
    we are going to try to codify it in this legislation.
        Ms. Andringa. Well, thank you. And thank you for making me
    aware of that. You know, we have talked about a lot of
    different kinds of infrastructure here this morning, and,
    really, they are all vitally important to our economic well-
    being, and certainly to us, as industry, manufacturers, and
    labor.
        And the NAM did a comprehensive report, really, on building
    to win. It includes really good data about things like water,
    and waste water is another one that is important, as well as
    the ports. Light rail, we haven't talked a whole lot about
    that, different transit systems. But, of course, roads and
    bridges and ports are vitally important, and probably the
    biggest numbers that we need.
        But I would also like to say that there are quite a few
    ideas in here about ways to fund this, and Congressman DeFazio,
    it is some of the same things you mentioned earlier.
        And the other thing I just want to say is that, as
    manufacturers--and I think you have heard it here, and I feel
    we are all preaching to the choir in this room, but we as
    manufacturers have to invest in our business. My dad was
    extremely conservative financially. We basically didn't have
    debt, and always tried to finance our own growth. But the one
    thing that he always said is we have to keep updating our
    equipment in the plants. Our welders, our machining centers,
    the tools that our employees use.
        Mr. Gibbs. No, I--yes. I fully understand that.
        Ms. Andringa. Yes.
        Mr. Gibbs. I just wanted to make it clear that----
        Ms. Andringa. No, anyway, I think what the point----
        Mr. Gibbs. We need funding, but I also want to make it
    clear there are ways we can be more efficient in doing things.
    And the integrated planning bill which I introduced is part of
    that----
        Ms. Andringa. Yes, yes.
        Mr. Gibbs [continuing]. At least on the waste water side of
    things. That is one of----
        Ms. Andringa. And again, I think manufacturers and those of
    us here are willing to invest.
        Mr. Gibbs. Yes, that is great.
        Mr. Willisch--did I say it right? In your testimony you
    mentioned making significant investments in mobility
    technologies, and automated driving, and autonomous vehicles. I
    recently learned that these investments--during discussions we
    have in Ohio, we have the Transportation Research Center
    located in central Ohio that provides for automotive testing
    services, and planning to build a winter indoor testing
    facility. So they have got thousands of acres there now, and a
    lot going on.
        I would like to hear any thoughts you might have on how
    proving grounds and testing centers play a role in developing
    these new technologies BMW would be interested in.
        Mr. Willisch. Well, first of all, I would like to say that,
    of course, the safety of people driving our vehicles is
    paramount to us. So we would not--never go ahead and test cars
    that are not fully developed with actual consumers.
        So, having said that, we are and will do a whole lot of
    testing before we have any automated vehicle available to the
    public. So that might be a thought, as well, yes. We have to
    test, and we have to be quick, because that is going to be a
    technology that is going to be----
        Mr. Gibbs. I just want----
        Mr. Willisch [continuing]. Around in the next 3 or 4 years.
        Mr. Gibbs [continuing]. To highlight that this testing
    ground we have in Ohio is state of the art, and doing it--an
    inside test facility would be beneficial. I want to make sure
    you are aware of that facility.
        Mr. Willisch. Thank you, yes.
        Mr. Gibbs. Thank you. And my time is up. I yield back.
        Mr. Shuster. Ms. Johnson?
        Ms. Johnson of Texas. Thank you very much, Mr. Chairman,
    and thank you very much for holding this hearing, you and the
    ranking member.
        I know that every member of this panel is aware that we are
    in desperate need of making additional investments in order to
    build up and maintain our crumbling highways and railways and
    waterways and airport infrastructure. At the same time, we are
    also dealing with a great deal of technologies, and we are
    dealing also with nonresilience in materials that we use, which
    causes us to have to do some projects over and over again.
        I still await the President's package coming over with a
    lot of enthusiasm, but I am very concerned about all of you
    commenting on how the industry is experiencing changes. One of
    the things that struck me, I went to Germany to the BMW plant
    last year, the year before, with the President. And it is a
    huge plant. It was larger than this complex. But I didn't see
    10 people working there. They were all robots. And I wonder.
    What is that going to have to do with the workforce in this
    country, and how do we handle it? And have you had any of those
    thoughts?
        Mr. Willisch. But we still have 70,000 people working in
    that plant you were referring to, so that is--it is not totally
    empty.
        Ms. Johnson of Texas. We walked almost the whole day
    looking, and I saw about 10 in the whole plant. But the number
    is not nearly as significant as the process. And looking toward
    the future.
        People think of infrastructure producing a lot of jobs. And
    in many industries, that is not necessarily the case. And I
    wonder how it is going to impact your industries as we look at
    infrastructure.
        Yes, Mr. Smith?
        Mr. Smith. Well, I have to tell you I am optimistic about
    this. As everybody in this room knows, with the beginning of
    the last century about 50 percent of the population in America
    was in agriculture. Now there is less than 1.5 percent of
    people in this country working in agriculture, and we are
    producing more agricultural products than we can consume, and
    it is one of our biggest exports. About 1 in 3 acres in the
    United States is produced for export.
        So, there are people in the container shipyards handling
    those exports. There are people in the railroads handling them,
    and so forth. So I am very confident, as things automate in
    other sectors of the economy, there will be plenty of good-
    paying jobs, as long as our educational system keeps up with
    it. And in Tennessee, as Congressman Cohen will tell you, we
    just passed a law, as I understand it, where any student in the
    State can go to junior college for free. And that will be the
    bedrock of people learning new skills to operate in these
    different environments.
        I have been to BMW in Germany, and where all those people
    that Ludwig is talking about, they are not on the factory
    floor, but they are up in the offices, doing design and
    computers, and designing the robots, and things of that nature.
    So, as long as we have a climate where business wants to invest
    in the United States, and an educational system that supports
    people being trained for these new technologies, I am very
    confident that things will be OK.
        In our industry, for instance, I don't think we are going
    to go to fully autonomous trucks, but I do think we will go to
    trucks where the truck driver becomes much more productive.
    They will have an auto-pilot. It will be safer, fewer
    accidents. They may have a robot truck following it that allows
    them to operate. And I think that is the trajectory that we
    will go on, as long as we incent investment, and we have the
    proper educational systems to support it.
        Mr. Shuster. The gentlelady's time is expired. Before we
    go----
        Ms. Johnson of Texas. Thank you. I was just getting
    started.
        Mr. Shuster [continuing]. Mr. Cohen has a----
        Mr. Cohen. Thank you. Since my name was mentioned, I want
    to thank Mr. Smith for the reference to junior college. All of
    that money is from the State lottery that you helped me, after
    18 years of effort, push across the line to fund that. Thank
    you, and thank you, Tennessee, for the State lottery.
        Mr. Shuster. Thanks for the commercial.
        [Laughter.]
        Mr. Shuster. Mr. Webster is recognized.
        Mr. Webster. Thank you, Mr. Chair. I have a question.
        Mr. Smith, you brought up Florida. I am from Florida. And
    the toll facilities down in Miami-Dade up to Fort Lauderdale,
    which were just on the interstate system, but there are several
    local expressway authorities that charge tolls on their roads,
    all the roads they have built. Then we have the Florida
    Turnpike Enterprise, which goes through the center of our
    State. And I am sure your trucks use those.
        Do you think that--especially the ones with the flexible
    congestion-type tolling, where it goes up and down, which is a
    good Republican idea--you pay for what you get--do you think
    the Federal Government should get involved and tell us--we have
    local toll roads, we have State-run toll roads. Do you think
    they should get in that? Is that a way to enhance the revenue?
        Mr. Smith. Yes. As I was saying to Ms. Norton, as we move
    to more natural gas-heavy trucks and more electric and hybrid
    vehicles on the highway, you are not going to have gasoline or
    diesel taxes to fund the Federal highway system. So the most
    productive system, in our mind, is some sort of RFID system
    that allows you to collect a user fee for those types of
    vehicles to use the Federal system.
        Once you have got that system in place, which is very
    simple with today's technology--that is why I used the example
    of going through the tunnels in New York, nobody even pays any
    attention to it any more--so it can also be used for congestion
    pricing and to incent people to have more occupants in a
    vehicle. So you can get a lot of productivity out of our
    transportation system.
        And I might point out, Congressman, that we have been
    operating 33-foot twin trailers in Florida for years very
    productively. And our drivers tell us they are safer. And that
    reduces traffic on your highways, both Federal and the State-
    funded divided highways you have down there.
        Mr. Webster. Yes. I remember in olden days, when I was in
    the State legislature, we approved that and it was good.
        I was just saying do you think that it would best be done
    by the Federal Government to use that, as opposed to State or
    local? I mean State and local do things that are local. They
    try to improve their--but in the end, how about if there were
    dedicated freight traffic roads that were paid for through
    tolls? Is that something you would be in favor of?
        Mr. Smith. Absolutely. It would take a lot of trucks off
    the road and--but having said that, I think you can get an
    awful lot of productivity on our existing expanded and improved
    highway system, doing the things that I just mentioned to you.
    You don't have to have dedicated truck lanes, but that would
    certainly be something that could be looked at.
        As to State versus Federal, I don't think it makes that
    much difference, provided there is a dominant design, there is
    a common technology standard that allows the VMT to be
    administered the same in Florida as it is in California, or
    Connecticut, or what have you. That is the main thing, right
    there.
        Mr. Webster. OK. Thank you so much. Yield back.
        Mr. Shuster. Mr. Larsen?
        Mr. Larsen. Thank you, Mr. Chairman.
        Mr. Smith, first off, on ATC and ATC reform, some folks
    have said that to privatize the system, the reason to do that
    is because airlines aren't receiving enough NextGen benefits.
    But I know in Memphis there has been some investment in
    NextGen, and FedEx, I believe, has directly benefitted from
    that investment in NextGen. Could you just cover that for us?
        Mr. Smith. Sure. We were the prototype location for a
    NextGen application which allowed us to narrow the separation
    between landing aircraft and aircraft taking off. It has been a
    spectacular success. It has improved the productivity of the
    FedEx operation there, saved tens of millions of gallons of
    fuel, allowed us to serve our customers more efficiently, and
    keep on time.
        A NextGen application nationwide, but particularly in the
    Northeast, which is the linchpin of the whole ATC system,
    because of the population density and the proximity of major
    airports one to another, there is the opportunity to vastly
    improve the productivity of the Nation's air traffic control
    system with the types of technologies that we demonstrated and
    prototyped at our major hub in Memphis, Tennessee.
        And I might add something here that is a little-known fact.
    In terms of the number of customs entries--not tonnage, because
    sea freight, obviously, carries more tonnage than air cargo--
    the largest port, in terms of customs entries in the United
    States of America is Memphis, Tennessee, where our super-hub
    is.
        Mr. Larsen. Yes.
        Mr. Smith. And the productivity of that hub, and the
    commerce of the United States because of those improvements in
    ATC pioneered by FedEx with the FAA in Memphis has vastly
    improved the productivity not just in Memphis, but the entire
    national economy.
        Mr. Larsen. Thanks. Mr. Chairman, you didn't reset my
    clock. I think there was a minute 30 and----
        Mr. Shuster. Mr. Larsen, I just looked and I said, ``That
    was 5 minutes?''
        Mr. Larsen. Yes, I know. It seems like a long time
    speaking.
        Mr. Shuster. You put me to sleep.
        Mr. Larsen. Yes, yes.
        Mr. Shuster. No, I don't think his clock was----
        Mr. Larsen. All right. So I got about 3 minutes or so? Yes.
        Mr. Shuster. Three minutes?
        Mr. Larsen. Yes, OK, great, thanks. I noticed. Thanks.
        Mr. Trumka, in your written testimony you discussed this,
    but you didn't really cover it in your oral testimony. Can you
    talk about the--sort of the marriage of workforce development
    and apprenticeships with infrastructure investment, and maybe a
    lesson for us as we approach infrastructure investment?
        Mr. Trumka. We view--we believe that we have the best
    skilled workforce in the world. We train more people every
    year. We bring people out of the neighborhood to be able to
    create a very, very, very effective workforce.
        Infrastructure, we think, is really a job-creator for this
    country. How it is financed will have an effect on how
    important or how widespread the job creation is. If a Buy
    America provision is expanded, and we think it should, it will
    have a greater impact on the number of jobs that are created.
    If more waivers are created, then taxpayers' dollars will be
    used to drive down wages and encourage outsourcing.
        That is why, on all the types of funding that we look at--
    private partnerships, for instance, have a limited
    applicability here, because they need a revenue source. So they
    won't apply to repair and maintenance, they won't do much in
    the rural areas. And if they do come about in those limited
    areas, we would like to see--we would need to see 13(c)
    protection, Davis-Bacon protection, domestic preferences,
    protection for rail and public-sector workers, so that those
    public dollars aren't used to drive down wages and actually
    suppress the economy and dampen the economy, but actually grow
    it.
        So how you do it is important. We are full-scale behind
    infrastructure, because, as every witness here has said, our
    country depends on it. Our competitiveness depends on it. And
    we are anxious to get started and put people back to work.
        Mr. Larsen. Thanks. Mr. Willisch, in talking about road
    sensors and markings and such, you know, when we talk about
    building roads, bridges, highways, we don't talk about painting
    lines on the road, usually. But what you are essentially
    saying, I guess, is that we need to be--for the--to support
    automated vehicles, we need to be rethinking a little bit the
    definition of infrastructure to support autonomous vehicles. Is
    that true?
        And then, does BMW have something more complete that you
    can offer the committee? Not in your answer, but just maybe for
    us to read later.
        Mr. Willisch. It is not really that complicated. We just
    need continuous marking, and that should be there, anyway. So
    it is not that we have to have a special thing for automated
    driving, it is just, you know, that the marking is continuing
    on the roadside and in the middle.
        Mr. Larsen. Yes.
        Mr. Willisch. So it is not a really specific BMW----
        Mr. Larsen. Just that simple?
        Mr. Willisch. Yes, it really is that simple.
        Mr. Larsen. OK. All right. Thank you.
        Mr. Shuster. I thank the gentleman. With that, Mr. Massie
    is recognized for 5 minutes.
        Mr. Massie. Thank you, Mr. Chairman. We just received some
    great news yesterday in Kentucky, but it is going to present
    another transportation infrastructure challenge to us. The
    Amazon Prime Air announced they are going to put their hub at
    the CVG Airport. And I would just say to Mr. Smith we have got
    UPS and we have got DHL, as well, in Kentucky. You are welcome
    to come over any time. It is a challenge we would love to face.
        But the challenge that it presents is how do you use the
    existing infrastructure, or how do you upgrade it, and how do
    you pay for it so that you can accommodate growth like that?
    You know, with UPS, DHL, and now Amazon Prime Air hub there,
    all feeding into I-71 and I-75, which are interstates that
    haven't changed a lot--the bridge they cross, the Brent Spence
    Bridge, was built 50 years ago, before any of that logistics
    infrastructure for North America was moved to Kentucky. And so
    now we are dealing with this. And I would say there is not a
    person here today, you know, testifying that isn't affected by
    that corridor, the I-71/I-75 corridor.
        But the real challenge, to Mr. DeFazio's point, is how do
    you pay for it. Because we know in northern Kentucky and
    southern Ohio we need a bridge. We are debating about where the
    next bridge goes. The bridge that is there, thankfully, was
    built with American engineers and American labor, and American
    steel. So it is--the reason that it is obsolete is it just
    can't carry the traffic that is there. So we need another
    bridge. We are having a robust debate about where that bridge
    should go, and how to pay for it.
        Mr. DeFazio had some good ideas, I think. And it scares me
    every time I agree with somebody on the other side of the
    aisle. You know, I like that he is in favor of user taxes,
    instead of taxes, per se--user fees, instead of taxes. But
    before I go back to my red district and ask them to index the--
    you know, the fuel tax to inflation and cost, I need to
    convince them it is a real user fee, and that the money is not
    being leaked out for other things that--where there are users
    who aren't paying a fee. For instance, bike paths,
    beautification, mass transit.
        If we could convince them that all the incremental money
    that is going into that fund is actually going to the
    infrastructure for the users that are paying for it, I think it
    would be a much easier sell. So I would just--you came a little
    ways toward me, I am coming a little ways toward you.
        And also, on the passenger facility charge, I think you are
    on to something there. There is two ways airports are funded.
    There is a tax that comes to the Federal Government, and then
    they ask mother may I, and we give them--we dole them back out
    the money. But there is another way, with the passenger
    facility charge, where they have local control and decide how
    to spend that money. So I would go you one better and say why
    don't we just get rid of the passenger facility charge cap, and
    let the airports decide. And then they wouldn't need to come to
    the Federal Government and ask for their taxes back.
        So, what do you think of that? If I yield to the ranking
    member----
        Mr. DeFazio. I have just advocated a small increase. I
    think the----
        Mr. Massie. Well, I don't want to increase. I want to take
    the cap off.
        Mr. DeFazio. That would be a market-based approach, in a
    sense. But I think I can hear the screams coming from downtown,
    from the--I mean now you are--you know, we are not just talking
    a couple of bucks. I mean, who knows? I mean it might----
        Mr. Massie. Well, I----
        Mr. DeFazio [continuing]. The cost of putting your bag in
    the overhead.
        Mr. Massie. Let's test the free market. But it is--I do--I
    did want to point out one of the benefits of serving on
    multiple committees is you see there might be solutions to
    problems that aren't all within one committee.
        I serve on the Oversight and Government Reform Committee,
    and I found out there we spent $100 billion building
    Afghanistan. Not on military funding, rebuilding Afghanistan.
    And the inspector general tells us the infrastructure we are
    building there is crumbling the day it is built. A lot of it,
    not all of it. And it is $100 billion. We are on the hook for
    $10 billion more over there. I would love to bring that over
    here and spend it on projects that are going to benefit users
    in America.
        Finally, I have got a few seconds here. I want to ask--Mr.
    Smith mentioned the regulation on the length of the trailers.
    Are there other regulations, Mr. Smith, that we could lift that
    would let you use the existing infrastructure more effectively?
        Mr. Smith. Well, I am sure there are some out there, but
    none that compare with the instant improvement and productivity
    of the 33-foot twin trailers.
        Mr. Massie. Mr. Willisch, do you have some regulations you
    would like to see lifted?
        Mr. Willisch. Not really, what we would say--there is one
    specific one, no.
        Mr. Massie. Just all of them?
        Mr. Willisch. All of them, but what we need is consistent,
    we need rules and regulations throughout the Nation. This is
    what we need, and we need to have that----
        Mr. Massie. Consistent.
        Mr. Willisch [continuing]. Consistently, that we have a
    consistent planning base.
        Mr. Massie. Ms. Andringa?
        Ms. Andringa. Yes. On regulations I would say I think it is
    just important to know that for manufacturers, we have just had
    a lot of regulations coming our way. And just to be able to
    keep up with compliance--again, for mid-sized companies, small
    companies, it is really hard to have the experts. Sometimes in
    your business you have to go find those people so you can make
    sure that you keep up with all the regulations.
        We bought a software system a couple of years ago just to
    track all the new regulations that were happening every day.
    And we would see 100 to 200 new regulations every day. Now,
    maybe only 5 to 10 of those really applied to us, but it still
    takes time to filter through them and to understand them.
        And I know manufacturers did a comprehensive study on
    compliance and the cost of compliance, and some of those
    definitely would connect with our infrastructure. And it is
    anywhere from, depending on the size of your company, from
    $10,000 to $30,000 per employee per year to comply with
    regulations.
        So, I would say we just need to make sure that the
    regulations we have are consistent, and I think across State
    lines, but that we also make it possible for our companies to
    be able to comply with regulations.
        Mr. Shuster. The gentleman's time has expired.
        Mr. Massie. Thank you, Mr. Chairman.
        Mr. Shuster. Thank you, Mr. Massie.
        Mr. Capuano?
        Mr. Capuano. Thank you, Mr. Chairman. I would just like to
    go on record to say that whenever Mr. Massie agrees with us, we
    get nervous, too.
        [Laughter.]
        Mr. Capuano. To the panel, when everything is said and
    done, everybody agrees we need to do something. We all know
    that. That is kind of like the easy, lowest hanging fruit there
    is. But there is a minor little point. You all run businesses
    or large organizations. Somebody has got to pay for this.
        And the question I have, really--and, Mr. Smith, to my
    knowledge--I have been listening to most of everything that is
    said, not everything--I think you are the only one who
    suggested a way, other than spending the Harbor Maintenance
    Fund, which I think is kind of ridiculous that we have to make
    that argument, the tax has been paid and sitting there. But,
    absent that, I am of the impression that everybody on the panel
    at least implied that you believe we need to put more money
    into the system.
        Now, we are talking about highways, but I would--I want to
    be real clear. I believe in--harbors are critically important,
    rail is critically important, and transit is critically
    important. Because, even if you are not moving goods through
    transit, your people are moving through transit, especially in
    the urban areas. All that being said, we need more money.
        Mr. Smith, you have made some suggestions, and I want to be
    real clear. Thus far, the smoke signals coming out of the new
    administration is somehow we are going to do this with just
    public-private partnerships. No new money.
        Now, I cochaired a group looking at public-private
    partnerships with Mr. Duncan last year, and we came to the
    unanimous, bipartisan conclusion that they have a role, and
    they are good, but they are no better than maybe--maybe--10
    percent of our needs.
        So my question for you is, first of all, do you agree that
    public-private partnerships can't do it all, can't even do most
    of it? And, if so, I would like to hear your suggestions--Mr.
    Smith, you already answered this part--your suggestions of
    where you think we should get the money. Because I will tell
    you that--I think it was about 3 years ago we had the president
    of the Chamber of Commerce, the U.S. Chamber of Commerce, sit
    in that chair and tell us the Chamber of Commerce supported an
    increase in the gas tax. So, for me, that was my first time
    ever agreeing with the U.S. Chamber of Commerce. And--but at
    the same time, I would love to find a way, if--I am open to any
    way to fund this.
        And, Mr. Smith, do you think the public-private
    partnerships can do all of this?
        Mr. Smith. No. I think it is something that could do some
    things, but what needs to happen is to increase the gasoline
    and diesel taxes, which haven't been increased--the Federal
    ones, that haven't been increased since----
        Mr. Capuano. Have you told this to the new administration?
        Mr. Smith. Yes, of course.
        Mr. Capuano. Have you told this to my friends on the other
    side?
        Mr. Smith. Well, I hope they are listening right now, so--
    --
        Mr. Capuano. You just did.
        [Laughter.]
        Mr. Capuano. Wake up, guys, wake up.
        Mr. Smith. But the answer to the question, yes, I told it
    to the----
        Mr. Capuano. Thank you.
        Mr. Smith [continuing]. Administration as late as
    yesterday.
        Mr. Capuano. Beautiful.
        Mr. Smith. And then, secondarily, I think we should move to
    some sort of RFID-based vehicle mileage----
        Mr. Capuano. You have no arguments with me on any of these.
    I am completely open.
        Mr. MacLennan, do you think the public-private partnerships
    can do the whole thing? And if not----
        Mr. MacLennan. No, I don't. So I think----
        Mr. Capuano. Where do you think we should get the money?
        Mr. MacLennan. So I am not the tax policy expert. I mean
    that is the crux of the issue, isn't it? It is a big spend. We
    have talked about the benefits that it brings to the economy,
    to jobs. So it has got to be some combination of private-public
    partnerships, effective tax policy.
        And also we would say that it has got to be balanced. But
    the users of the systems, whether it is rivers, roads,
    railroads, got to be--you have got to have some skin in the
    game. So it has got to be multiple constituents.
        Mr. Capuano. Have you expressed that to the administration?
    Have they asked?
        Mr. MacLennan. I have not been invited to----
        Mr. Capuano. Well, neither have I, so, you know----
        [Laughter.]
        Mr. MacLennan. I think you will get invited before I will.
        Mr. Capuano. I wouldn't count on that.
        [Laughter.]
        Mr. Capuano. Mr. Willisch, what about you? Do you think the
    P3s can do it all, or do you think that we need to increase
    revenues?
        Mr. Willisch. Experience tells you no, you cannot do that.
    But otherwise, I can tell you a lot about developing cars or
    producing cars, or distributing cars. But I am not a tax
    expert, either, so I would limit my contribution here to those
    three fields, rather than talking about----
        Mr. Capuano. That is fair enough.
        Ms. Andringa, what do you think?
        Ms. Andringa. Yes, thank you. I concur with my colleagues
    that it has to be an all-of-the-above. That is what we talk
    about, as manufacturers. We are going to need the gas tax, user
    fees. We are going to need public-private partnerships, maybe
    bonding, infrastructure bank.
        And the thing that I think we just want to remember is the
    stimulus package that happened in 2009. I think a lot of us
    thought more money would go to infrastructure in that package.
        Mr. Capuano. So did we.
        Ms. Andringa. And it was, like, less than 10 percent. Now,
    there were other reasons, and we were in a different economic
    situation. But I think what is really important is that
    whatever package, bold package I hear coming from this group,
    is it does have to be--it really has to be used for what it was
    intended to be used for.
        Mr. Capuano. Totally agree.
        Mr. Trumka, I actually know your answer, but you should put
    it on the record, anyway.
        Mr. Trumka. No, we don't. We think partnerships have--
    public-private partnerships have a limited applicability,
    because they need a revenue source. And, in fact, if you are
    going to attract public capital, or private capital, that is
    dependent on having a Government source of--stream of revenue
    involved. And unless you can show that on a regular basis--5,
    6, 7, 8, 9, 10 years out, then private capital is not going to
    get involved, even for the small percentage of the jobs that
    they could do.
        We would support an increase in the gas tax. We think it
    should have been indexed for inflation years ago. We would also
    agree with my friend at the end of the table that it ought to
    be broadened to capture those, as changing technology goes by
    to capture more of those people, so that as electric cars and
    other forms of transportation that use highways and use the
    infrastructure in place, but skip out on it, they should be
    paying their fair share, as well.
        Mr. Capuano. Thank you.
        Mr. Chairman, I would just like to go on record as saying I
    love this panel. Thank you for having them.
        [Laughter.]
        Mr. Shuster. I am glad we made you happy, Mr. Capuano.
        With that, Governor Sanford is recognized.
        Mr. Sanford. Two quick thoughts. One, I think it is
    important to give credit where credit is due. And with regard
    to BMW, I think it needs to be remembered the time that they
    came to South Carolina. It was 20 years ago. The textile
    industry was shifting out of our State. Manufacturing had been
    hit incredibly hard, and people were hurting.
        And you know, BMW made a bet on our State, and they really
    brought--they were the leaders in bringing in a new era of sort
    of advanced manufacturing. And so, in its wake, Volvo, and
    Boeing, and a whole lot of others have come. But it was BMW
    that started that ball rolling. And I think it is important
    that I acknowledge that.
        I think what is also interesting, though, is, from the
    standpoint of global capital allocation, you have made a bet,
    in part, based on market share and entry into the United States
    market. But I think, going back to, in essence, the
    conversation we have been having with regard to infrastructure
    and how you stay competitive, the question is would you make
    that decision today.
        And if there was one single thing as you compare investing
    in India versus China versus the United States, what would be
    the one thing that you would change?
        Mr. Willisch. Very clearly, we would make the same decision
    today. And just let me say that, just by our latest investment
    of $1 billion additionally--we have now spent about $7.5
    billion--we created almost another 1,000 jobs.
        So, I think, more or less, we would do the same thing today
    again, and we would be at the same location, with the proximity
    to the harbor of Charleston. I don't think we would change--
    maybe we would think about our start, which was a little rough
    in the first 2 years. But otherwise, we would do the same
    again.
        Mr. Sanford. I thank you.
        Then, let me extend this question over to you, Mr. Smith.
    You have been a visionary for a long time. You have been ahead
    of the curve, whether that is submitting a business plan in
    business school that was not exactly seen as the way to go, but
    you seem to be able to look around the corner. And I would ask
    you the same question with regard to competitiveness.
        You mentioned some good ideas, whether that is, you know,
    congestion pricing or territorial taxes. If you were, let's
    say, Donald Trump, and you look at this notion of being a chief
    executive in this country, and you look at, again, capital
    allocation, how do we attract and retain more in the way of
    capital that leads to investment and jobs, are there a couple
    other things that we haven't talked on today?
        Or, as you look around the corner at what comes next, are
    there things that jump out at you that you would say, ``You
    know, as a committee, you all ought to think about X or Y''?
        And let me throw in one last thought on that question. I
    think that one of the things that some of us struggle with with
    regard to taxes, not just a knee jerk reaction to a tax
    increase, but rather this notion of Thomas Friedman's flat
    world, and how indeed competitive the global marketplace is.
        And so, if you look at CBO numbers, what they show is that
    deficits are projected to increase rather dramatically. And
    that is in sort of a best-case scenario. What is interesting
    is, in essence, a deficit is simply a tax. It is a deferred
    tax. It is handed to the next generation, but it is a tax. The
    taxes are already going up.
        And so, what a number of us struggle with is not a knee
    jerk reaction to a gas tax or other things, but how do we
    retain competitiveness if, overall, our tax environment begins
    to look less competitive than some of the other choices that
    FedEx or BMW or other places have around the globe. Any pearls
    of wisdom or thoughts on that front?
        Mr. Smith. Well, assuming that regulations become more
    efficient, which the President started to do with his Executive
    order the other day--and you just heard an example down here of
    a wonderful business that--overwhelmed with regulations.
        But the single most important thing the United States could
    do to be more competitive is to lower the corporate tax rate
    for C-corporations. The top 1,000 corporations in America make
    50 percent of all capital investments. Those are the tools that
    I was talking about that make our blue collar workforce more
    productive and able to earn more. And the same time that that
    happens, we should go to a territorial tax system with some
    sort of appropriate tax rate to keep from gaming the system.
        I saw the other day Chairman Ryan talking about this
    suggested border adjustability tax being equivalent to a VAT.
    It is not. Mexico has both a corporate income tax--much lower
    than us--and a border-adjustable VAT, which everybody sees and
    is eliminated at the border.
        C-corporations pay about $300 billion in taxes. If you
    lowered the corporate tax rate and went to a territorial
    system, I have no doubt, from talking to CEOs in industries
    around this country, CAPEX, GDP goes up, tax receipts would
    increase. The top 5,000 C-corporations make 95 percent of the
    capital investments in this country. You can't apply the same
    rates to C-corps that--to pass-throughs. And that is the
    problem. That is what is driving this border adjustability
    concept.
        If you are a pass-through, a sub-chapter S, an LLC, and you
    want the corporate tax rate, then you can reincorporate as a C.
    And when you take that money out, you pay whatever the personal
    income tax rate is. But retained earnings in C-corporations are
    the feedstock of tomorrow. And the only way to pay those bills
    without increasing the deficit is increased GDP.
        Mr. Shuster. Thank you, Governor.
        Mrs. Napolitano?
        Mrs. Napolitano. Thank you, Mr. Chairman. And gentlemen,
    everybody on the panel, I would like to refer to that saying up
    there: ``According to the system of natural liberty, the
    sovereign has only three duties to attend to.'' One, the third
    one, ``The duty of erecting and maintaining certain public
    works and certain public institutions, which it can never be
    for the interest of any individual or small number of
    individuals, and to erect and maintain,'' et cetera.
        Say it--that said, I hear what you have said in regard to
    the maintenance of bridges, roads, all of that. Do you know
    that the Army Corps of Engineers has a $40 billion construction
    backlog, a $20 billion operations and maintenance backlog, and
    appropriated only $4.5 million this year? Makes sense to you?
    Would you do that to your company? Anybody?
        [No response.]
        Mrs. Napolitano. So, I would, in all fairness to the
    administration, ask you to pose to them the question of whether
    we can continue on this road of not funding those that maintain
    the areas which you have a great interest in. Am I correct? Any
    comments?
        [No response.]
        Mrs. Napolitano. Mr. Trumka, I am very happy to say that I
    am--take my hat off to the best workers that you have. They are
    recognized worldwide for their professionalism. And I hope that
    we understand that you build to last, that you do your work so
    that everybody knows that when a union person has done it,
    there is no change order, there is no backlog on things to go
    back and change.
        In regard to the increase, Mr. Smith, there is a current
    understanding that the electric batteries are now holding more.
    You are going to CNG. Are you considering going to electricity?
        Mr. Smith. We have a number of all-electric and hybrid-
    electric vehicles in our local pickup and delivery operations.
    Those are generally lighter trucks. In the heavy-truck sector,
    we are converting a significant amount of our infrastructure
    over to compressed natural gas. Neither of those are picked up
    in the current Federal gasoline and diesel excise tax.
        And so there would have to be a different system to pick up
    over the road operations of personal automobiles and heavier
    trucks that are natural gas-powered. That is why I suggested
    the RFID solution.
        Mrs. Napolitano. All right. The gas mileage is an issue. We
    have been debating of how we can collect more taxes from those
    that have electric vehicles, CNG. Somehow we have been on this
    conversation for years. We have yet to come to an agreement.
    Will you have any suggestions?
        Mr. Smith. Well, again, if you want to build
    infrastructure, it would be a relatively simple task, with
    today's technologies, to build an RFID reader system throughout
    our Federal highway system. A small tag, just like you have
    when you--if you are a regular user going through the tunnels
    in New York that read when you pass by and send you a bill on
    your credit card, I mean, that should be an integral part of
    infrastructure spending to develop an alternative electronic
    system that allows users to help pay for the system.
        Mrs. Napolitano. But it is easier for you to say. You try
    Government trying to come to an agreement.
        Mr. Smith. No, I understand. I have been testifying in this
    exact room for 43 years. So I have watched you all very
    closely----
        [Laughter.]
        Mrs. Napolitano. Precisely.
        Mr. Smith [continuing]. For many, many years. And over the
    last 25 or 30 years I think the whole conversation of this
    committee has been the inability of people that are in the
    Congress to support payment streams for things that we have to
    have. I mean that is the issue. It is not any failure to
    recognize we have got a problem here. It is an unwillingness to
    provide the funding to fix it.
        Mrs. Napolitano. Precisely.
        Thank you, Mr. Chairman. Yield back.
        Mr. Shuster. Thank you. Mr. Woodall is recognized.
        Mr. Woodall. Thank you, Mr. Chairman. It has to be said
    that, according to Mr. Smith's testimony, the first packages
    went out in April of 19, what, 73. So if 44 years ago business
    opened and you have been dragged in front of this committee for
    the last 43 of those years, we have some bigger problems that
    we need to work on together here, Mr. Chairman. That is just a
    show of respect to the generations of Shusters that have led
    this organization here.
        [Laughter.]
        Mr. Smith. Seems like I have been testifying before
    Shusters for a long time.
        Mr. Shuster. I believe that.
        [Laughter.]
        Mr. Woodall. Mr. Chairman, I appreciate your doing this
    panel to get us started this year. This is full of American
    success stories, each and every one. I certainly count the BMW
    success story as an American success story. I was going to
    school in South Carolina in 1992 when that announcement was
    made. And the sense of hope and optimism that BMW brought to
    that South Carolina community cannot be overstated. And the
    need for that hope and optimism today cannot be overstated.
        I represent the great State of Georgia. And, of course, our
    port in Brunswick is a large exporter of your product. Once
    upon a time, more product per production--more product was
    exported from that plant in South Carolina than any other
    automotive plant in this country. Is that still the case, do
    you know?
        Mr. Willisch. At least I have knowledge that it was the
    case in 2015.
        Mr. Woodall. I drive that point home because folks talk
    about infrastructure and getting goods to market and people
    building plants in America because that is where the consumers
    are. I want to talk about the fact that we have the best
    workers in the Nation, on the planet, that are teamed up with
    the best infrastructure in the world that lead to those kinds
    of exports. And I would love to have an export-driven economy,
    instead of a consumption-driven economy. And I appreciate what
    BMW does to help make that happen.
        Mr. Smith, I wanted to ask you about open skies. I saw it
    on the tail end of your testimony. Undoubtedly, competition is
    the key to making sure that we are all doing the very best we
    can. Competition is good for McDonald's and Burger King. It is
    good for politicians, and it is good for aviation. But I do
    worry about unfair competition. And I hear from our domestic
    carriers, not that they want a special carve-out to prevent
    competition, but they want a level playing field so that they
    can have fair competition.
        In your testimony it seemed to suggest that you dismissed
    their concerns as wanting a special carve-out instead of a
    level playing field. Could you speak to that, just for a
    moment?
        Mr. Smith. Well, no, sir. I don't dismiss the concerns of
    the three major passenger carriers at all. I would simply point
    out, as I have over and over again, there is a specific process
    and a provision in existing law that requires them to file a
    complaint. The reason they won't file that complaint is because
    they will not be able to demonstrate harm. Why won't they be
    able to demonstrate harm? Because they don't fly to the Middle
    East.
        And what they are trying to do through their opposition of
    open skies is to force travelers from Southeast Asia, India,
    and Africa to go over their code partners, or on their systems
    through Western Europe, as opposed to going through the hubs in
    the Middle East.
        So, if they want to have this fight, there is a provision
    to do that. They won't file under the existing provision to let
    everything see the light of day. So we don't support their
    position, because of their refusal to do that.
        Mr. Woodall. They--well, undeniably, being able to
    demonstrate that unlevel playing field is critical.
        I remember back in 2012 FedEx had that same concern about
    subsidies in the postal marketplaces around the globe,
    demonstrated that concern. I want to see those concerns
    demonstrated and eliminated. And I hope Secretary Chao is going
    to be able to give an open ear to that. FedEx is an amazing
    success story. You, as an individual, are an amazing American
    success story. And I am certain that keeping a level playing
    field is going to be that foundation on which we build more
    American success stories.
        Mr. Trumka, I wanted to comment on part of your testimony.
    Folks don't get to see your testimony written, they just listen
    to it. It is your overarching principles there at the very end.
        Number one--you could have listed anything as number one.
    And you said, ``Number one overarching principle is the program
    must include investments that are as transformative in the 21st
    century as railroads, highways, telephones, radio, and
    television electrification were in previous centuries.'' I just
    couldn't agree with you more. I get so tired of nibbling around
    the edges, and I don't see a hunger back home for maintaining
    roads. Folks believe that is the lowest part of the bar. Of
    course we are going to do that. Of course we are going to keep
    our commitment to that.
        What are we going to do to transform ourselves going
    forward? And I say that coming from a not particularly
    unionized part of the world down there in Georgia. Of all the
    things we can partner on, all the great American success
    stories that are there, I just want you to know how much it
    means to me, first hearing out of the gate we are talking about
    what we can do, golly, to be as transformative in the 21st
    century as those accomplishments were you mentioned in the
    20th.
        Thank you, Mr. Chairman, for having an opportunity for us
    to----
        Mr. Shuster. Thank you.
        Mr. Woodall [continuing]. Celebrate what we agree on.
        Mr. Shuster. You brought up my father's name, so whenever
    you brought it up I got to--impart some Shuster knowledge. So
    there has been a Shuster on this committee as long as FedEx has
    been in existence. So we are glad we have been able to work
    with you. And I hope your time in front of me was more pleasant
    than in front of my father.
        [Laughter.]
        Mr. Shuster. Because I know how tough that can be.
        Ms. Titus is recognized.
        Ms. Titus. Thank you, Mr. Chairman.
        I greatly respect your 43 years, Mr. Smith. I have been
    here now--I am in my fourth term, and I have a similar
    experience. Nothing really has changed over those years, except
    my seat has moved back a little bit. We are having the same
    conversation, got the same rhetoric. Need to fix the
    infrastructure. We got the score of D minus on the engineers'
    infrastructure report card. All the options are on the table.
    We need to look at this. It is just a matter of paying for it.
    But there is no substantive plan.
        I commend the ranking member for trying to put out
    something on paper to say this is how we can fix it. But there
    is no plan, it is just a little dibs and dabs here and there.
    Everybody agrees we need to do something. Well, that is not
    going to get the job done.
        We have also heard a lot about maintenance of
    infrastructure, but I can tell you in the West, and in my State
    of Nevada, where you have had rapid growth and development,
    there is a tremendous challenge there, too. It is not so much
    repair and maintenance, but it is providing access. If you look
    at Nevada, we are $285 million shortfall every year for the
    next 10 years, just to build State highways, alone. So we have
    got to do something.
        Actually, my question goes to Mr. Trumka. I would like to
    ask him what he thinks about the suggestion that all our ills
    will be solved if we just give more corporate tax breaks to the
    big companies.
        And then, my second question, going back to the
    conversation about the public-private partnerships, how you
    would address those in terms of labor agreements, employment
    agreements. You know, everybody talks about those as though
    there are hundreds of them out there. There is really only a
    handful. And I can tell you that, in Nevada, where they are
    doing Project Neon, which is a big interstate project right
    downtown, they looked at doing one of these P3 agreements and
    decided it made no sense financially or from a maintenance and
    management perspective, and backed away from it.
        So would you address those two questions for me?
        Mr. Trumka. I certainly will. A lot of talk has been had
    about repatriation, first of all. And that, of course, is a
    lump-sum revenue source, one time. Previous repatriation plans
    have disadvantaged U.S. companies by giving tax breaks to their
    offshore counterparts. We would oppose any kind of tax system
    that encouraged or rewarded outsourcing off country.
        Further, any action on repatriation should not reward those
    who game the system by granting them overly low tax rates. So
    we would end the deferrals. We would be willing to look at a
    lot of different things, including border adjustment taxes,
    things of that sort, that would actually encourage production
    here, encourage manufacturing here. But we don't think that
    just cutting taxes is a solution because, in many instances, we
    can show you where low taxes have done nothing, and some of the
    biggest companies that have paid no taxes have still continued
    to offshore things.
        With regard to the private partnership stuff, how would we
    take care of that? First of all, they are of limited access,
    and limited use. They require a revenue source. And so repair
    and maintenance jobs, things of that sort. And even in the
    rural areas, where the revenue source would be low, are never
    going to get built. If you do them--and there are instances
    where we could see working with them--you still need to have
    the protections of 13(c), Davis-Bacon, domestic preferences,
    protections for rail and public-sector workers.
        And we would increase the Buy America provisions of that,
    as well, so that, in fact, those tax dollars, or even the
    private-sector dollars, are used to increase jobs here at home,
    and increase our economy, rather than drive down the wages of
    Americans here.
        We are willing to look at and work with people on a lot of
    different funding sources. But blindly saying all you have to
    do is reduce the income tax on corporations and everything will
    be fine simply doesn't square with reality.
        Ms. Titus. Thank you very much. I yield back.
        Mr. Shuster. Mr. LaMalfa?
        Mr. LaMalfa. Thank you, Mr. Chairman. Thank you for
    convening this. And indeed, a very good cross-section of
    interest on this fine panel today, representing a lot of what
    America is looking at for its transportation and materials
    transporting needs.
        So when I--you know, first time on this committee here, and
    I am excited about it. I hear a lot of conversation going on
    here about the different aspects of how we are going to
    accomplish things. And I just want to always remember that when
    I hear maybe a little is being done to get the funding, well, a
    lot is being done every day by every American family in paying
    the way for all of this, whether it is the gas taxes they fuel
    up, or the tax on tires, as well as the excise taxes that come
    along the way, and then on the products that they purchase when
    they--when a truck is carrying that--if you got it, a truck
    brought it, but a truck paid to get it there, as well as rail
    and ports.
        So there is a lot of ways people are already paying for
    this. And I think what really needs to have more attention paid
    to it is that--are we doing things as efficiently as we can
    with the dollars we have? Are the dollars being channeled into
    transportation infrastructure that people are paying at the
    pump?
        Interesting discussion on ports a little bit earlier. I
    don't know the--all the background on that particular port fee
    that isn't being paid completely towards using it for ports; I
    need to learn. But that is a great discussion. But people, when
    they are paying it, they certainly want to see those dollars
    get into the infrastructure and not go somewhere else.
        So, we have--I am from California, I am from the ag
    business myself, and surrounded by many people that are in
    agriculture, whether it is grain or fruit, nut crops, hay
    crops, you name it--timber industry. So they are very
    interested in a lot of the port aspects, as well. And being on
    the west coast, it is getting pretty tough with the port system
    we have there, with the load we have. And we--you know, we saw
    ag products suffer quite a bit just a couple years ago, when
    things weren't moving very well through the ports. So we are
    glad to see that moving well. A strong bipartisan effort in
    this town helped to overcome some of those challenges. So we
    need to keep that going. But we have issues with our ports, you
    know, dredging that needs to be done to keep, like, the ports
    in northern California moving well.
        We got to overcome the obstacles. And sometimes I see a lot
    going on with getting permitting done to do anything on, you
    know, port maintenance, adding the highway infrastructure. I am
    in the rice business, OK? And so when I saw some--this is not
    that many years ago they were going to infringe on a rice
    field, you know, pay the farmer for the land that was being
    taken in order to build up an overcrossing and a clover leaf.
    They were also concerned about the mitigation for the rice
    land, because they look at that as habitat. Now, that is
    someone's private property. And--but they are going to--they
    were worried about mitigating the land that was in a rice
    field. And that just kind of blew my mind, as a rice grower,
    that, no, I am--you know, so there is a lot of hangups on just
    getting these projects done.
        And so, when I am looking at the--how the folks in my
    district, they are especially going to be interested in what
    further can be done to--and I would point this to Mr.
    MacLennan, if you don't mind, on that. What do you see, as far
    as our rail system being able to get some of these products to
    port and trucking--but the main thing being the port aspects of
    moving sometimes very perishable products timely--through
    those, I mean, so we can remain competitive on the west coast,
    as well as the whole Nation?
        Mr. MacLennan. Yes. As you pointed out, Representative, the
    congestion--the port congestion in this country is the worst on
    the west coast. And so, when you have the congestion in the
    port facilities, it backs up the whole system. And, to your
    point, it creates all kinds of damages, losses relative to the
    value of produce. It impacts export markets.
        So, I think, you know, whether it is dredging, or
    increasing facilities for barges along the riverways, as I
    mentioned, a safety--but your particular district--not
    necessarily your district, but California in particular--is in
    the most need, relative to port facility improvement, which
    will improve our trade and our overall commerce, and the
    livelihood of the farmers.
        Mr. LaMalfa. And what do you see are roadblocks that we
    could handle in Government that don't necessarily mean, you
    know, an additional fee or a rate hike or something? What are
    some of the road blocks we could be doing that would be using
    the dollars we have in our system?
        Mr. MacLennan. Well, we have got the Harbor Maintenance
    Trust Fund is the quick answer. I mean we have got billions
    there in the taxes that have been collected, you know, waiting
    to be spent. So I think I would focus on that first, is getting
    the funding into the system, and through a--whether it is
    public-private partnerships, or, you know, the projects that
    are already underway that has been pointed out in committee
    from the Army Corps of Engineers, we are ready to go.
        Mr. LaMalfa. Yes.
        Mr. MacLennan. With the funding.
        Mr. LaMalfa. I get concerned about permitting, as well,
    because there is----
        Mr. MacLennan. Yes, yes.
        Mr. LaMalfa. You know, let's get the work done, let's get
    the people to work doing the work that want to, and----
        Mr. MacLennan. You have got to have the efficiency.
        Mr. LaMalfa. Yes. I yield back. Thank you, Mr. Chairman.
        Mr. MacLennan. Thank you.
        Mr. Shuster. Thank you. Ms. Wilson is recognized for 5
    minutes.
        Ms. Wilson. Thank you. Thank you, Chairman Shuster and
    Ranking Member DeFazio, for holding this important meeting. I
    am a new member of this committee, and I look forward to
    working with both of you and the entire committee to provide a
    21st-century infrastructure for our 21st-century businesses and
    communities.
        Thanks to all the witnesses who have testified here today.
    I am the founder of the Florida Ports Caucus and the chair of
    the Florida Ports Caucus, and we do a lot of work with ports.
        But when my--when I first arrived to Congress I would go to
    the floor every day and my mantra for Congress would be jobs,
    jobs, jobs. And I was concerned because we were unable to pass
    a jobs bill. And I had two great jobs bills that would create
    jobs, because I believe that if we employ everyone in our
    country, then we would have a better country. We wouldn't have
    people on--so many people looking to Government for help. We--
    everyone would be working.
        In my opinion, I think that--I want to ask a question,
    first of all, to Mr. Smith. And I want to first thank him for
    creating so many good jobs in my district for my constituents.
    I represent Miami-Dade County, which is home to several FedEx
    shipping centers and a significant regional hub for Latin
    America and the Caribbean, which we were happy to tour. I want
    to also acknowledge your--you for the diversity of your
    workforce. I was able to tour your operation in Paris, thanks
    to my dear friend, your senior vice president, Gina Adams. It
    was an extraordinary experience.
        In your written testimony, you warned that FedEx would not
    be able to continue to grow the economy and create jobs without
    improved infrastructure. And I was happy to hear you mention
    education. I am a former school principal, so I know how
    important it is for children to be educated to take the next
    level of jobs that we create. Could you please elaborate on the
    impact of delayed infrastructure investment on your company and
    sector?
        And also, you said that you believe user fees would help.
    And are you interested, or would you approve higher user fees
    to get this done? Because everything is stuck.
        Mr. Smith. Well, the answer to the last question is yes, we
    would support higher fees. And as I have mentioned several
    times, we have supported an increase in the Federal gasoline
    and diesel tax to do that.
        But let me give you one factoid which will just bring this
    in perspective. All of us know what it is like to buy a tire
    for our car. Over the past 20 years, our over-the-road vehicle
    tire utilization has been cut in half. So we are using almost
    100 percent more tires to produce the same mileage of
    transportation. Why is that? Because the road infrastructure
    has so many potholes in it, it is tearing up tires faster than
    what was the case before.
        The congestion, Mr. DeFazio's clock up there, is a real
    cost to business and a real cost to consumers. The cost of
    congestion is getting worse. It is preventing time-certain
    deliveries, which are important for things for hospitals and
    things of that nature. So there is a cost to the public, there
    is a cost to FedEx, there is a cost to UPS, there is a cost to
    Cargill by delaying these expansions and required upgrades and
    maintenance of the highway system.
        So thanks for your job as a teacher. My brother was a
    teacher. After parenting, it is the most important job in the
    country, in my opinion.
        Ms. Wilson. Right. Thank you.
        Mr. Trumka, in your written testimony you mention reducing
    poverty and inequality as a guiding principle for
    infrastructure investment. In your opinion, what infrastructure
    investments and policy reforms would best support poverty
    reduction?
        Mr. Trumka. I think there is two facets to that answer. One
    is we talked about automation and new technology, and that has
    always been important for a dynamic economy. And it is
    important in transportation. But that said, we can't use
    technology as an excuse to ignore the cost to workers,
    communities, and safety. If anything, technology should be used
    to combat inequality, not to ignore or accelerate the problem.
        And so, one point I would make is, as this committee looks
    forward, you ought to strike--I look forward to working with
    you so that we can strike the right balance between worker
    safety and progress.
        The system sometimes locks people out. And so we have to
    get them skills at the lower level. We have started, in our
    apprenticeship program, going back and doing remedial courses,
    offering remedial courses so that applicants have the necessary
    math skills--writing skills, reading skills, English skills--to
    be able to pass our entrance exam and get into the community,
    make sure everybody has that opportunity.
        Also, if you can't do--if you do public-private
    partnerships and you don't follow the protections of 13(c) and
    Davis-Bacon and domestic preferences and all of those things,
    tax dollars will be used to drive down wages, which will
    increase poverty in a lot more areas. And so we would guard
    against those, as well.
        And the projects ought to be spread through the country, so
    that there is a geographical look at it. So the rural Americans
    are getting a shot at some of the jobs and some of the better
    infrastructure, and thus--then looking more attractive to
    business to come into some of those rural areas. And we would
    urge the committee to look at that geographical spread, so that
    large segments of Americans aren't just locked out, that we
    don't just do this in populous areas, but we look at the rural
    areas, as well.
        Mr. Shuster. The gentlelady's time has expired. Mr. Lewis
    from Minnesota is recognized.
        Mr. Lewis. Thank you, Mr. Chairman. Thank you all for
    coming today. It is very important that we hear from the
    experts in the field and doing the tough work. I represent a
    district in Minnesota that is primarily suburban, primarily
    automotive-dependent. We have got a couple of major interstate
    arterials through our district, 35 and 35E, and congestion is
    always a problem. Over 78 percent of the citizens in that
    district commute by car alone. If you add in pools, it is 87
    percent. So that is very high on our agenda.
        But Mr. Trumka said something interesting not long ago, and
    it is how we invest matters. And when I look at this, and I
    think when the committee looks at this, I hope, that we are
    going to look at the investments that have the greatest return.
        We all know that productivity is the key to rewarding both
    labor and capital. It is not a zero sum game. If we are more
    productive, everybody benefits. So, let me ask you--and let's
    start with my Minnesota friend, Mr. MacLennan. What do you
    think, when we look at roads, bridges, rail, certainly air
    traffic control, airports, broadband, transit? What is the
    biggest bang for the buck, in general, in--certainly that
    affects your industry?
        Mr. MacLennan. Well, thanks, Representative Lewis. I am a
    little biased, relative to making sure we take care of the ag
    economy. And I think the ag economy in Minnesota and the rest
    of the United States really can benefit from continued
    investment in our port system and our riverways.
        And I mentioned a little while ago that the efficiency of
    our riverway system relative to volumes that you can put on a
    barge. You can put over 50,000 bushels on a barge, maybe 1,000
    bushels on a truck, so it is environmentally friendly, but it
    does have limitations. So I think, relative to not forgetting
    the importance of the rural economy and the jobs, and the
    importance of the rural economy to the agriculture system, I
    think for us they are all connected. It is kind of a, you know,
    three-legged stool: rail, road, rivers, as well as ports. But
    for us I think it is riverways and barge transportation and
    ports.
        Mr. Lewis. Mr. Smith, you had mentioned the idea of moving
    to a system that is essentially a user fee system, or getting
    there, getting closer to that. And you talked about congestion
    pricing. That intrigues me a little bit, and it intrigues a lot
    of people who haven't just read Reason Magazine lately.
        But we have got a couple of interstates there that--
    sometimes during the day it is relatively free-flowing. But not
    at 7:30 and not at 4:30. Can you elaborate on that just a
    little bit?
        Mr. Smith. Well, congestion pricing would presumably move
    some of that traffic into the shoulder periods, where the
    highways aren't utilized as much. There are many people that
    don't have discretion in when they travel.
        But congestion is always on the margin. In other words, it
    is that last 3, 5 percent that causes gridlock. So moving a
    relatively small number of cars and trucks into the less
    congested time of the day makes the infrastructure more
    productive. That is what they showed down in Florida when they
    used congestion pricing.
        Having said that, the real key is to provide more
    infrastructure and alternative routings. You can't just solve
    the problem with some sort of technology and congestion pricing
    and incentives to use higher occupancy vehicles, and so forth.
    You have got to build the additional infrastructure that I was
    reading from a little earlier, that our interstate highway
    projects that--we could start building tomorrow if there were
    funds available to do it.
        Mr. Lewis. I think we do have to do exactly that. In fact,
    I used to say that the trucker is a lot more productive with
    the truck. Now we can include the road, too. They have got to
    get the infrastructure.
        Now, there are opponents to some of this. Real quickly,
    anybody on the panel? And I hear it in the Minneapolis-St. Paul
    metro area quite a bit, that, ``Well, this is great, but you
    can't build your way out of congestion.'' We hear that from the
    opponents of adding on to any infrastructure capacity. Anybody
    can comment on that if they like, but I hear that a lot.
        Mr. Smith. Well, that--to some degree it is like saying in
    Memphis, Tennessee, nobody would like to use a bridge across
    the Mississippi River other than the one we have, because it is
    so heavily utilized.
        Mr. Lewis. Yes, right.
        Mr. Smith. So you build another bridge, and all of a sudden
    you are amazed at how many people decide they want to go over
    there to avoid the congestion, or build a new shopping center,
    or whatever the case may be.
        So I don't think there is any question about the fact that
    the United States Department of Transportation, with the
    States, has a lot of wonderful projects to increase our
    capacity and reduce congestion.
        Mr. Lewis. Thank you. I yield back my time.
        Mr. Shuster. I thank the gentleman. Mr. Johnson from
    Georgia is recognized.
        Mr. Johnson of Georgia. Thank you. Mr. Smith, I suppose it
    has been kind of frustrating over the last several years to
    witness Members of Congress strictly adhering to their promise
    under the taxpayer protection pledge to oppose any increase in
    Federal Government tax revenues. Has that been as frustrating
    for you as it has been for many of us?
        Mr. Smith. Of course.
        Mr. Johnson of Georgia. And you, of course, know what that
    taxpayer protection pledge is.
        Mr. Smith. That is Grover Norquist's pledge that you have
    to sign, right?
        Mr. Johnson of Georgia. That is correct.
        Mr. Smith. Well, I would point out to you one thing here.
    Our senior Senator from Tennessee was heavily involved in the
    Inland Waterway Act. And it is my understanding that the
    various interests that are opposed to taxation became
    supportive, once the revenue source was redesignated as a user
    fee.
        Mr. Johnson of Georgia. So, do you mean that----
        Mr. Smith. That is the Inland Waterway Trust Fund funding.
        Mr. Johnson of Georgia. So do you mean that there was an
    exception made to the Grover Norquist taxpayer protection
    pledge that resulted in new revenues----
        Mr. Smith. That is my understanding.
        Mr. Johnson of Georgia [continuing]. To the Federal
    Government? Well, I think that is a wonderful event that has
    occurred. I wonder if we can duplicate it. Do any of you other
    panel members have anything to say about this strict adherence
    that we have seen towards this taxpayer pledge?
        While looking, of course, at the--at what was written out
    of our Constitution that our chairman put on the wall, it says
    the Congress shall have power to lay and collect taxes, duties,
    impose--and excises. It doesn't say Grover Norquist shall have
    the power. What do you all think about that?
        And I see you raising your hand, Mr. Trumka.
        Mr. Trumka. Yes. I think it has had an absolutely horrible
    effect on the competitiveness of this country. We get further
    and further behind every year, because we don't have--we are
    starved for revenue to be able to do the basic infrastructure
    that this country needs, let alone the infrastructure we need
    to transform us into the 21st century.
        If you have a house, and the house--the roof starts to leak
    on the house, and you don't take care of it, it gets more and
    more and more and more expensive. The more we delay with
    infrastructure, the more and more and more and more expensive
    it gets, and the less and less and less competitive we get. I
    think we are all pretty much in harmony on the fact that
    infrastructure needs to be done, done now, and done at a very,
    very large scale.
        Mr. Johnson of Georgia. And it is going to take increased
    revenues to do it right.
        Mr. Trumka. Absolutely. And can I just add one other thing?
    I wanted to comment to Congressman Lewis when he said what is
    the biggest bang for your buck. The best way to get the biggest
    bang for your buck is to get the lowest cost of capital for
    your buck. The lowest cost of capital spreads those bucks a lot
    further. And I will work with this committee to do that, to
    make sure that the funding source gets us the lowest cost to
    capital.
        Mr. Johnson of Georgia. Well, I think that is important.
        I also want to talk about another factor in profitability
    for businesses, and it is this issue of worker productivity.
    And I want to ask you all whether or not you believe that
    having a satisfied, well-paid workforce contributes to
    productivity and profitability when it comes to your companies.
    And, if so, then why would we support any measures that would
    hurt workers' ability to collectively bargain for issues that
    would create more productivity for workers?
        Mr. MacLennan. So I agree, that an engaged and happy
    workforce is critical to success. But I don't think that you
    have to have collective bargaining exclusively to achieve that.
    We have got about 70,000 workers in the United States, and some
    are union employees and some are not. And I think you can have
    engagement and productivity in both circumstances. So I don't--
    --
        Mr. Johnson of Georgia. Well, shouldn't workers be able to
    choose whether or not they want to be able to collectively
    bargain or not is----
        Mr. MacLennan. I think that is generally the case, is it
    not?
        Mr. Johnson of Georgia. Well, you wouldn't want to hurt
    that ability, would you?
        Mr. MacLennan. I think you want to give people the
    opportunity to be well informed, and to be able to make the
    choice that they feel is best for them, yes.
        Mr. Shuster. The gentleman's time has expired.
        Mr. Johnson of Georgia. Well, I think that is common ground
    that we can all agree to. And I thank you all for your--for
    being here today. And I thank the chair and the ranking member
    for having this hearing as our first hearing of this new
    session of Congress. It is so important.
        I also have a statement that I would like to introduce for
    the record.
        Mr. Shuster. Without objection, so ordered.
        Mr. Johnson of Georgia. Thank you.
        Mr. Shuster. Thank you, Mr. Johnson.
        Mr. Johnson of Georgia. I yield back.
        Mr. Shuster. Mr. Smucker?
        Mr. Smucker. Thank you, Mr. Chairman. As a former business
    owner, a contractor, understood the importance of highway
    system that enabled us to move goods and employees to job
    sites. And in my particular area, Lancaster, Pennsylvania, when
    we had new highway systems, bypasses around bottlenecks built,
    it opened entirely new markets for our company, because we
    could get to a new market in an hour or so, which was sort of
    our limit.
        So, with that background, I am really happy to not only be
    part of the committee, but to be part of this hearing as the
    first thing we are doing in this session. We are really
    evaluating the impact of Government investment in our
    infrastructure system.
        And I want to share just a little bit of experience. I
    served in the Pennsylvania State legislature for--the State
    senate for 8 years. And we were successful in passing an
    infrastructure bill, basically a highway funding bill, after
    years of not having done so. Pennsylvania highways and bridges
    have a bad reputation, a high number of bridges that were
    rated, you know, insufficient. And we were able to get a bill
    passed.
        And this was in an environment--to the point that was just
    raised, this was in an environment where, at the same time,
    we--and with my support--my caucus, other Members, other
    Republican Members, we were turning our State budget inside
    out, looking for ways to save dollars and ensure that we were
    providing for more efficient use of taxpayer dollars. We
    literally went line by line throughout the budget and
    eliminated hundreds of line items, and reduced overall
    spending.
        But at the same time, we were able to pass a transportation
    bill that increased our funding for transportation. How did we
    do that?
        Number one, we said that we were there to focus on the core
    functions of Government. And there were a lot of areas where we
    shouldn't have been--it was better done in the private sector.
    But, you know, our infrastructure can only be done--can be done
    best, at least, or primarily can only be done through
    Government, and maybe public-private partnerships. We did some
    of that, as well. But it is a core function of Government
    critical to our environment.
        It was a lot of work there. But what it took--I think what
    took it over the finish line, and this is--maybe there will be
    a question at the end of this for whoever may want to answer.
    But really, what took it over the finish line was a well-
    coordinated, well-funded effort to educate the public on the
    importance of investment in our infrastructure.
        And we talk about the creation of jobs during the building
    of roads or whatever it may be. You know, there are also huge
    economic benefits--you have all talked about that--in terms of
    jobs created, economic growth, and so on. So I guess, you know,
    I saw it, whether it was the Transportation Association, the
    chambers throughout the State, the Pennsylvania State Chamber
    of Commerce, a coordinated effort to educate the public about
    the costs of congestion, of waiting in traffic, and so on and
    so forth, and about increased safety.
        So my question to you is what efforts are we making here,
    at the national level, to drive public support, to build public
    support for investment in infrastructure that we are talking
    about?
        Mr. MacLennan. I will answer quickly, which is I think it
    is a good point, because I think when it comes to
    transportation and infrastructure, what is most commonly
    thought about is I am spending a lot of time in my car, getting
    to and from work. And it is far more complicated in nuance than
    that. We have got railroads, we have got ports, we have got
    riverways, and we have got highways, and they are all
    interconnected.
        So I think the message that we in the private sector can
    help deliver, in conjunction with the public sector, is there
    is a cost, infrastructure is not just about highways, it is an
    interlinked system. And it is costing the country a lot of
    money and a lot of job opportunity.
        Mr. Trumka. We are already doing a lot of education with
    our central labor councils, our State, Feds, and all of our
    strategic partners, religious groups, environmental groups, and
    things of that sort.
        One of the things is to educate them. And most people don't
    know the figures, that the average commuter spends 42 hours a
    year----
        Mr. Smucker. That is the kind of--and I am sorry, I am at
    the end of my time, I am going to cut you off. But that is the
    kind of information that, you know--what we are talking about
    in the hearing room today that the public needs to hear.
        Mr. Trumka. Yes.
        Mr. Smucker. And that is how we are going to begin to build
    the kind of support we will need----
        Mr. Trumka. And we are doing that.
        Mr. Smucker [continuing]. To do that. So thank you.
        Mr. Shuster. Thank you, Mr. Smucker.
        Mr. Lipinski?
        Mr. Lipinski. Thank you, Mr. Chairman. Thank you for
    holding this hearing. And thank the ranking member for raising
    the important issue of how are we going to pay for this. I know
    it is not directly in our jurisdiction in this committee, but
    it is something that we really need to focus on.
        I want to move very quickly through a few things. The first
    I just wanted to mention. The Recovery Act funded some things
    that were--sort of expanded what--the definition of what some
    people may think of as infrastructure. But, for example, fire
    stations were funded. And those are important facilities,
    certainly critical for public safety. So I think we need to
    have a serious discussion about what the definition of
    infrastructure is going to be, not--we won't have that here,
    right now, but I just want to put that out there, that we may
    want to think more broadly, and include things such as fire
    stations.
        I want to move on to something Mr. Trumka had talked about
    earlier. In his inaugural speech, President Trump made a
    commitment to buy-American principles. Too often, waivers and
    loopholes allow agencies and grant recipients to avoid
    compliance with domestic content requirements.
        So, I am introducing a bill next week, the Buy American
    Improvement Act. And one of the things my bill does to improve
    transparency and accountability is to close some of these
    loopholes. The bill is going to require that any waivers be
    published in the Federal Register so that businesses would be
    able to better identify products that are in demand, and seek
    opportunities to work with the Federal Government.
        I want to ask Mr. Trumka if this will be helpful, and if
    there is anything else that you would want to expand on,
    anything else we can do to better make sure that we are buying
    American and hiring Americans.
        Mr. Trumka. Closing the loopholes would be tremendously
    helpful because, as it stands right now, the lack of that has
    had a devastating effect on a lot of industry: steel industry,
    auto industry, a number of others. We recommend four things
    along those lines.
        One is that the percentage requirements should be increased
    until we get to 100 percent American content requirements. The
    Buy America must attach all infrastructure, including, as you
    noted, fire houses, schools, and drinking water. The loophole
    should be closed and the process standardized. I think you
    mentioned that your bill would do that. You would have to
    publish it in the Register, any waivers, so that people would
    know what the standards are, how you meet them, and why you
    don't meet them.
        And DOT must implement, I think, a uniform and transparent
    standard for waivers, so that the law is followed as intended.
    I think those would have a very, very beneficial effect, create
    a lot of jobs in America, and make us, quite frankly, far more
    competitive.
        Mr. Lipinski. Thank you. I wanted to move on. Something Mr.
    Larsen had mentioned--I want to ask Mr. Smith and Mr. Willisch
    if there is anything that you think needs to be--the Federal
    Government needs to do in regard to really facilitating
    driverless vehicles. I know they are going to be very important
    and already coming on to the road. Not just cars, but also for
    trucks. Is there anything either of you want to add, say that
    we should be doing in order to better facilitate this at a
    Federal level?
        Mr. Willisch. Well, very simply, potholes and discontinued
    markings stand in the way of automated driving. But those basic
    requirements should be fulfilled anyway for any car, any truck
    that is using American roads, or roads in the civilized world.
    So I would say this is the basic requirement that we have to
    fix.
        Mr. Lipinski. Thank you. Mr. Smith, do you want to add
    anything?
        Mr. Smith. Well, I think that the way forward is to have
    the United States Department of Transportation have a
    standardized, nationwide certification process, just like we do
    for aviation. So if you want to make an airplane in the United
    States, the DOT, FAA doesn't tell you how to do it, but you
    have got to meet certain standards with your engineers, and
    then they certify.
        So, just as was mentioned, there need to be standards for
    the roads, the markings, the redundancies in all of the
    technology. The worst thing that could happen is for automated
    vehicles to be subject to a balkanized, regulatory system at
    the State level. So that is my suggestion to what you should do
    to promote autonomous vehicles.
        Mr. Lipinski. Thank you very much. My time is up, I yield
    back.
        Mr. Shuster. Thank you, Mr. Lipinski. Mr. Perry is
    recognized.
        Mr. Perry. Thank you, Mr. Chairman, and thank you all for
    taking your time to be here today.
        Private-sector financing of infrastructure seems to be a--
    at least a discussion, if not a cornerstone of the new
    administration. And I, too, am interested in that, specifically
    for transportation and how the private-sector can be used to
    improve the transportation system. I was privileged to sit on
    the P3 panel in this very committee that--we discussed a lot of
    those things. It is for some things, maybe not for some other
    things.
        But I am just wondering, anybody on the panel there, if you
    believe the committee should encourage and leverage the
    ingenuity of the private sector, if there is anything
    specifically that you would recommend in that regard that we
    should consider, look at, encourage, et cetera?
        Yes, ma'am?
        Ms. Andringa. Well, I think already a lot of the public-
    private partnerships have been in certain areas. Like I think
    in rail, in energy, and in telecommunications. So with some of
    those, there are already probably some best practices there.
    And again, I think we have all said we are going to need more
    than that, though.
        But looking at what has worked well in maybe those three
    areas would be something that could be replicated in some other
    areas of infrastructure. Because we have lots of areas of
    infrastructure.
        Mr. Perry. Anything particular in highway and surface?
        Ms. Andringa. You know, it seems like highways are such a
    huge area. We flow people and products all the time on
    highways. So I think looking at the Highway Trust Fund and how
    we can make that solvent for the future is probably number one.
        Mr. Perry. I will give you an example. I am sorry, Mr.
    Trumka, go ahead.
        Mr. Trumka. Well, I would just make two points. One,
    permitting reform would be helpful to get projects up and going
    quickly. And the second thing is, when you look at public-
    private partnerships, you still should look for the lowest
    source of capital, so that they aren't used to siphon off
    capital at a higher rate, rather than going back into
    infrastructure.
        Mr. Perry. So there is--and I would agree with you. I think
    there is a situation I know in the district I am privileged to
    represent along the Federal highway where there is a fair
    amount of business, but there is not a, you know, off ramp,
    there is not an interchange there. And the people that own the
    surrounding businesses have said, ``We would be interested in
    building it and charging people to come off of it to recoup our
    investment or whatever at some point, and working some
    arrangement out with that,'' but there is no vehicle for them
    to do that. Pardon the pun.
        You see any problem or downside to something like that at
    the Federal level?
        Mr. Trumka. Well, again, you are looking at the revenue
    source. And we would--if you are going to do that, you still--
    in the building of that thing you would still want to have
    section 13(c) and Davis-Bacon, and all of those things apply,
    so that it isn't used to drive down the wages of people in that
    community.
        Mr. Perry. But aside from those things, you don't have any
    issue with it?
        Mr. Trumka. Oh, if it can work, then we would work to see
    that it worked.
        Mr. Perry. All right. And Mr. Trumka in particular, with
    your exchange with the gentlelady from Miami-Dade, you
    mentioned inequality. I have a question for you regarding
    Davis-Bacon.
        Now, according to some studies, increases transportation
    project cost by over 9 percent. And I know that there is going
    to be little agreement on what the percentage is. From my
    experience running my own business, it increased the cost. But
    that is my experience, and we can--let's just--that is just
    some conjecture out there.
        But I would just ask you. The average current
    transportation project cost, for an average cost, is $1.5
    million. And the existing threshold stands at 2,000 since it
    was moved down in 1935. That is a long time ago. I am just
    wondering if you would be amenable to having a discussion about
    raising that threshold concomitant with inflation since 1935.
    There are many people in the United States that see this as the
    last vestige of Jim Crow, as it literally keeps out some people
    that want to get into the trades, but they can't because the
    threshold is so high that small businesses can't compete,
    because they can't get in.
        Mr. Trumka. Well, I would say no. I think, if anything, the
    threshold ought to be eliminated, because the Government should
    never, never, never, never be in a position of doing work below
    the community standard. That is all it does.
        It says--Davis-Bacon says the community standard is X. And
    if that person is paying less than X, they are paying less than
    the normal people in that community are paying. Not the Federal
    Government, but the people in that community. If you come in
    and you start using tax dollars to go below the community
    standards, you drive down wages for everybody. That was thought
    a bad thing, because it spirals us downwards. I still think it
    is a bad thing.
        And so, I would say eliminate the threshold all together.
        Mr. Perry. But you would agree that was not the original
    genesis of Davis-Bacon. I mean that was not----
        Mr. Trumka. It was the original genesis of Davis-Bacon, was
    to make sure that the Federal Government didn't use tax dollars
    to drive down wages.
        Mr. Perry. No, it was to keep out certain classes of
    workers, namely blacks and immigrant workers, from Federal
    projects.
        Mr. Trumka. Well, I totally----
        Mr. Perry. I can cite that for you. But OK----
        Mr. Trumka. I would totally disagree with you about that.
        Mr. Perry. Thank you. Chairman, I yield back.
        Mr. Shuster. I thank the gentleman. Ms. Lawrence is
    recognized.
        Mrs. Lawrence. Chairman Shuster and Ranking Member DeFazio,
    thank you for holding this hearing.
        I was a mayor for 14 years. And during that time I had
    people come to me directly when water pipes, potholes needed to
    be fixed. And I got it done. But mayors across this country are
    very concerned now, because they are making financial decisions
    about the taxpayers' dollars in their community, and they
    knowingly know that their disinvestment in the infrastructure
    is going to have an effect, sooner or later.
        Mayors across the country--and there was an article in
    Politico, ``Highways Aren't Enough.'' We are at a critical
    time. And I am comforted to hear our plan for investing in the
    infrastructure. I am also encouraged by--one of the few things
    I am encouraged by is that this administration has made a
    commitment to invest in our infrastructure.
        Today we have a panel--business, labor, CEOs--talking to
    us, and we are all on the same page, Democrats and Republican.
    Maybe this is our time to really put the--put our actions and
    money behind what we all know should be happening.
        Mr. Trumka, I was very intrigued by your job training and
    apprenticeship programs. Now, ladies and gentlemen, I started
    the skilled trade caucus here in Congress. The average age of a
    skilled trade worker is 53 years old, and we have pretty much
    decimated the training and investment in a trained, skilled
    workforce. We do not have the number of young people entering
    into the skilled trades. We know that if we do this investment
    in the roads, we will get jobs. But they will be skilled trade
    jobs.
        So, Mr. Trumka, you have a--really, a birds-eye view of the
    challenge of the skilled trading apprenticeships. Can you talk
    to us about how we can invest, when we are doing our plan, that
    we are also training the workforce that can get the jobs?
        Mr. Trumka. Well, I can try. We have started partnering
    with community colleges to do remedial courses, but to do one
    other thing. We have also looked at small manufacturers that
    need maybe 10, 20, 30 people, and we have said we will provide
    those skills for you, we will train them, but you have to
    guarantee a job at the end of the mill.
        Mrs. Lawrence. Exactly.
        Mr. Trumka. And we have been working with them. And
    anything you could do to encourage that kind of commitment
    together, us getting people together and helping our
    apprenticeship programs--obviously, the more work you have, the
    more people you put through it, the more people you could put
    through the apprenticeship program, the remedial program, and
    put them to work.
        And the beautiful thing about the apprenticeship program is
    you are getting an education. When they come out they are two-
    thirds of the way to a bachelor of science degree.
        Mrs. Lawrence. Exactly.
        Mr. Trumka. They have an associate degree and they are
    getting paid the entire time that they are in the
    apprenticeship program. And it is helping our employer, because
    you have a mix between journeymen and apprentices that actually
    help us develop the skills necessary to go forward.
        Mrs. Lawrence. Yes.
        Ms. Andringa. Yes, I would just like to also emphasize how
    important it is, I think probably for this committee, as
    others, to also work with the Department of Labor to show that
    these things need to work together, and I think across the
    Nation.
        And I know manufacturers have been talking about that, as
    well as infrastructure, for many years. A skilled workforce is
    so important. Just one example in the State of Iowa now, our
    Governor has made it a goal that at least 70 percent of high
    school graduates go on to something, either a 2-year program,
    which we are highly recommending, 4-year, or a good certificate
    program.
        Mrs. Lawrence. Yes.
        Ms. Andringa. And again, that includes the apprenticeships
    and the internships and the co-ops.
        And I know our community has a career academy for our high
    schools, our local high schools, so that the students get time
    to do what we call real-world work.
        Mrs. Lawrence. Yes.
        Ms. Andringa. And I loved it when I had a senior in high
    school come and work with a computer programmer for a couple
    weeks. This was like a winter program. At the end he said, ``I
    now have found a real-world application for algebra.'' And he
    was going on to a 2-year institution.
        Mrs. Lawrence. I want to--because my time is running out--
    --
        Ms. Andringa. Yes.
        Mrs. Lawrence. Mr. Smith, you have the truck drivers, and
    you have a real need for a skilled workforce there. Is there
    any--as far as roads and getting our skilled truck drivers
    together, do you see a connection here?
        Mr. Smith. Well, I think that the most important thing to
    get people on the roads that are qualified is to invest in the
    technologies that make the vehicles more safe, which we are
    doing to the tune of hundreds of millions of dollars a year.
    And it makes the job more pleasant. As I mentioned, we should
    have auto-pilots in the vehicles to make it less boring, and so
    forth.
        Let me give you a real-life example. We have thousands of
    aircraft mechanics. And the whole job has changed because of
    digital technology.
        Mrs. Lawrence. Yes.
        Mr. Smith. So we partnered with a community college in West
    Memphis, Arkansas. We are training these folks. They come in as
    apprentices. And those with full benefits, and so forth, are a
    fantastic job. Much higher paying than many college graduates.
    So I think business and the States at the community college
    level, working with businesses, can produce a lot of high-
    income, blue-collar jobs in the United States. They are not
    even blue-collar jobs any more, they are----
        Mrs. Lawrence. They are skilled trade jobs.
        Mr. Smith [continuing]. Computer-oriented.
        Mr. Shuster. The gentlelady's time is expired.
        Mrs. Lawrence. Thank you.
        Mr. Shuster. And I just urge Members to stay on 5 minutes
    or less. They are going to call a vote in about 1:15. I don't
    want to shortchange anybody, don't want anybody to not get a
    chance to ask a question.
        With that, Mr. Graves is recognized.
        Mr. Graves of Louisiana. Thank you, Mr. Chairman. I want to
    thank all of you for being here, I appreciate your endurance.
    This has been very helpful, though.
        Ms. Andringa, if I remember correctly, you were on the
    President's export council, is that correct? The President--
    excuse me, President Obama, years ago, during the State of the
    Union speech, indicated his intention of doubling exports. And
    I don't remember the year, I think it might have been 2015.
    And, as I recall, nothing close came about. Could you talk a
    little bit about, looking back, where you see some of the
    course corrections that you wanted done, had you started over
    again?
        Ms. Andringa. Yes. That definitely was a goal. And we were
    making progress for a few years. But, to be honest with you,
    for us as an exporter, when the dollar went so high, our high
    dollar made it much more difficult to export, because we were
    competing with less cost from a lot of our competitors
    overseas.
        Mr. Graves of Louisiana. Did you see a role in investment
    in infrastructure at all----
        Ms. Andringa. I was on the workforce group, and we talked a
    lot about the skilled workforce that we need. And we also
    talked a lot about how to make sure we include small and
    medium-sized enterprises.
        Infrastructure was definitely one of the topics, and
    usually the Secretary of Transportation was at those meetings.
    So it was definitely connected. We talked a lot about ports, we
    talked a lot about water, but probably not as much maybe as we
    could have.
        Mr. Graves of Louisiana. Thank you. Many of your companies,
    you deal with logistics. And obviously, a critical part. Part
    of your calculation, Mr. Smith and Mr. MacLennan, it
    specifically gets back to looking at efficiency. You have to
    get products to certain places in certain periods of time. You
    look at different routes, you look at different modes of
    transportation, and you have to determine the most efficient
    way of delivering something.
        Similarly, we have talked in this committee today about the
    need for additional investment to recapitalize our
    infrastructure. But there has not been a lot of conversation
    about whether we are using the right prioritization system. You
    have to prioritize how you are going to get a product from A to
    B. Do you have any comments about the current system that we
    use to prioritize the investment of infrastructure dollars in
    the United States?
        Here is where I am going. We all know four-lane roads that
    don't have a single car on them. We all know four-lane roads
    that are bumper-to-bumper traffic. Do you have any thoughts
    about lessons learned, perhaps from your business, from your
    perspective, about how we could do a better job investing our
    existing dollars?
        I ran an infrastructure program for a number of years, and
    everyone's first go-to is we need more money. And I don't
    believe that is always the case. And I am not saying--I think
    we need additional capitalization here, but I also think that
    we probably can squeeze additional efficiencies out by doing a
    better job using the right metrics to prioritize investment.
        Mr. Smith. Well, I think that is true, and I think that is
    going to be a big source of focus of Secretary Chao. She is
    very good at this area, and she will prioritize the things that
    have the greatest national impact on the national productivity
    and efficiency. And I read off a litany----
        Mr. Graves of Louisiana. You did.
        Mr. Smith [continuing]. Of projects that would----
        Mr. Graves of Louisiana. Including my home State of
    Louisiana, which I appreciate.
        Mr. Smith. Well, one of them is right in Louisiana, that is
    right. So that is what we ought to prioritize, right there, and
    adding to and improving and updating our Interstate Highway
    System in the main.
        Mr. Graves of Louisiana. Mr. MacLennan, you would like to
    add----
        Mr. MacLennan. I would just add to that, that I think--you
    know, in a traditional capital allocation model you are looking
    at returns on capital. And, Rich, you mentioned lowest cost of
    capital. But I think, relative to infrastructure, I think
    sometimes you can put quantitatives aside and go to
    qualitatives. Get some quick wins. Get some very visible
    projects.
        And the congressman previously had asked about how can we
    educate the public. But, you know, I think it is not just
    necessarily about return on capital, but I think it is about
    speed, getting money into the system. Things that can get these
    bottlenecks done and get money into the system fast and
    visibly, I think is a good model to apply, a qualitative model.
        Mr. Graves of Louisiana. Thank you. Last question, and I
    want to ask you to be very brief so I can return some time
    back, but just very quickly, do you believe that there is an
    opportunity to increase utilization of waterways in an effort
    to help reduce congestion on highways?
        Mr. MacLennan. Absolutely. I have mentioned before about
    the efficiency of the waterways. And you can get more bulk, you
    know, from the agricultural economy onto our waterways. Your
    home State, I mean, we mine salt in Louisiana and ship it up
    the river and bring up fertilizer up the river, and it takes
    pressure off the highway system.
        So part of being the interconnected system, the opportunity
    here is invest across the board, rails, roads, ports, and
    rivers, and that frees up congestion on the highway system.
        Mr. Graves of Louisiana. Thank you.
        Mr. MacLennan. Thank you.
        Mr. Shuster. Great question from the new chairman from the
    Water Resources and Environment Subcommittee. Mr. Payne is
    recognized.
        Mr. Payne. Thank you, Mr. Chairman. And thank you to the
    ranking member for holding this hearing. Such a great cross-
    section of industry in this country, and issues around
    transportation.
        Mr. Trumka, you know, I come from--I am a lifelong resident
    of Newark, New Jersey. And the city's unemployment rate is
    currently around 9 or 10 percent. You know, yet, you know, my
    district sits at the doorstep of what could potentially be the
    Nation's largest infrastructure project in the coming decade,
    the gateway project.
        You know, billions of dollars of public investment are
    needed to make the gateway a reality. Can you speak a bit more
    about how large-scale infrastructure investments and training
    people--you know, just as the--training you were talking
    about--can help put our Nation back to work?
        Mr. Trumka. Yes, I--we are talking trillions. I think the
    deficit for old infrastructure is approaching $4 trillion right
    now. And the Society of Civil Engineers say it will take
    another couple of trillion dollars to get us into the 21st
    century. If you want to ease congestion on highways, maybe we
    ought to look at high-speed rail and train systems, like Europe
    does. They get people around a lot. All of those things can
    help with us and create jobs in the process.
        Mr. Payne. Thank you, sir. And Mr. Smith, let me also say
    that my home town is a big hub for you, and we--you know, if
    you want to continue to expand there, we welcome that. But you
    know, there are quite a few people in my district that benefit
    from your company and being able to work for FedEx. And just
    wanted to say thank you. I was able to tour the facility when I
    first got to Congress, and found a very impressive operation.
        You and Mr. Willisch both spoke on the need to modernize
    our ports, our airports and our seaports. You know, we have
    seen Federal investment in the Port of Newark and Elizabeth,
    but much, much more is needed to stay competitive. Newark
    Airport is aging, as well. I know both of your companies rely
    on these critical ports to ship goods. Can you speak more
    specifically to investing the investments that our aging
    airports and seaports need to keep you competitive?
        Mr. Willisch. Well, we obviously--as we expand, just from
    2007 to today, we have roughly almost doubled our volume that
    we sell in the United States, which also means, for example,
    our facilities in Port Jersey need to expand. We are really
    trapped there, as far as the size of our facilities is
    concerned. We have no way to grow. So it really is one thing
    that we can get the right size of ships into the ports. And the
    other thing is, of course, the size of the port. Both
    absolutely crucial to us, and we have a lot of issues,
    especially in Port Jersey.
        Mr. Payne. Right. Yes, they--the dredging has been finished
    there, and they are working on raising the Bayonne Bridge--will
    help facilitate, you know, the type of commerce that you are
    talking about increasing.
        Sir, would you like to----
        Mr. Smith. Well, when I mentioned airports, Newark is a
    huge hub for FedEx. In most cases you have to separate airport
    infrastructure from passenger terminals and additional runways.
    In the case of the airport infrastructure, we pay landing fees.
    So we are a huge contributor to the maintenance and operation
    of Newark Airport. We pay 80 percent in Memphis, a huge
    percentage at our big hub in Indianapolis.
        On the passenger side of the house, just as Mr. DeFazio
    said, that has to be done through some sort of user fee like
    PFCs or what have you. And the main thing is more runways and a
    modernized ATC system to make the air transport network more
    efficient and have more capacity.
        Mr. Payne. OK.
        Mr. Smith. The latter are Federal responsibilities.
        Mr. Shuster. The gentleman's time has expired.
        Mr. Payne. Thank you. Thank you.
        Mr. Shuster. Thank you, Mr. Payne.
        Mr. Babin?
        Dr. Babin. Yes, sir. Thank you, Mr. Chairman. I want to
    thank each and every one of you for being here, giving us this
    great information that we need.
        I am from Texas, and represent the 36th District. I have
    four ports, including the Port of Houston. And more
    petrochemical facilities than any other district in the
    country. And so, infrastructure and transportation is a huge
    thing for us.
        But, with--we are talking about user fees versus normal
    taxation. With a $20 trillion national debt and a $600 billion
    deficit coming up, looks like, funding is the 900-pound gorilla
    in the room. So I would like to start with Mr. Trumka, if you
    don't mind.
        One idea that is frequently coming up is to dedicate the
    revenues and royalties from resources that development--
    resource development which lie under our public lands. And--
    which is estimated in some cases to be several trillions and
    trillions of dollars, which would go towards construction of
    public works projects, which would include roads and bridges,
    and all the things that we have been talking about today.
        This would be American energy produced by American workers
    to finance and build projects with American labor that benefit
    American families. Is there any reason that you can give why
    such a concept might not be a top priority for an organization
    like the AFL-CIO, Mr. Trumka?
        Mr. Trumka. We would be willing to look at it. Of course,
    the devil is always in the detail. If it were a giveaway to
    anybody, rather than real projects like you just described, we
    would probably blow the whistle on it. But I think we would be
    supportive of putting Americans to work, having energy
    independence, and being able to create and repair our
    infrastructure in the process.
        Dr. Babin. Right, OK. And anybody else who would like to
    comment on that, as well?
        Mr. Smith. We would be fully supportive of it, obviously.
    As Mr. Trumka said, the details are important. But we are
    blessed with these energy resources here in the United States.
    We ought to produce them and use some of the revenues to
    develop new alternatives and fund infrastructure. It would be a
    great idea.
        Dr. Babin. Yes, ma'am. Ms. Andringa?
        Ms. Andringa. Yes, I mentioned earlier--manufacturers are
    very dependent on energy and are always looking at all of the
    above, including wind and solar, but definitely traditional as
    well. And natural gas has been a very important thing for
    manufacturers.
        So I think it really could do two things: help
    manufacturers with the most effective cost for energy that we
    need to run our plants, but also from a source that could be
    used to help with some of the other issues in this country, and
    certainly provide jobs.
        Dr. Babin. Thank you. Anyone else want to add to that?
        OK, Mr. Chairman, I yield back the balance of my time, and
    thank you very much.
        Mr. Shuster. Thank you, Dr. Babin, thank you.
        Mr. Davis, final question.
        Mr. Davis. Thank you, Mr. Babin, for yielding back the
    balance of your time.
        Dr. Babin. You bet.
        Mr. Davis. We appreciate it.
        Dr. Babin. You bet.
        Mr. Davis. Hey, thank you to the entire panel. Let me get
    quickly to my question. Coming from Illinois, I represent a lot
    of areas along the Mississippi and Illinois Rivers, very
    concerned about water infrastructure. I am glad that that was
    addressed by many of my colleagues before me.
        But let me start with Mr. MacLennan. We have had Cargill
    testify before my other committee, the House Ag Committee, so
    it is great to have you here on the T&I Committee to talk about
    that nexus of infrastructure that really helps the
    manufacturing sector in States like Iowa, also helps the
    agriculture sector in States like Illinois that are, you know,
    slightly better agriculturally than States like Iowa, of
    course.
        Mr. MacLennan, can you articulate for the committee the
    importance of our Nation's inland waterway system, more so than
    what you did with some other questions? Specifically along the
    Illinois and Mississippi Rivers, where you have many of your
    facilities.
        Mr. MacLennan. So, as you know, Congressman, in your
    district you have locks 20 through 15 along the--the Illinois
    and the Upper Mississippi, riverways, transit, port are crucial
    for the rural economy, for the ag economy, for farmers to be
    able to get their crops to where they need to be.
        And we talked early on in the testimony about the world--
    the country going to 400 million people, the world going to 900
    million people--9 billion people, rather. And our States, the
    Midwestern States, are feeding the world. And if we can't get
    the grain--and we saw it when you had the polar vortex, and
    things freeze up, and you don't have appropriate
    infrastructure. It is--all creates a backlog. And so it is--the
    ports are the key--one of the key choke points for the ag and
    rural economy, to be able to get our exports to the rest of the
    world, to get the food where it is needed.
        Mr. Davis. Well, I completely agree. And I think we also
    agree for about 80 years we are--we have heard somewhat for
    about 80 years, but we have heard about long delays in our 80-
    year-old locks.
        Mr. MacLennan. Yes.
        Mr. Davis. And sometimes lasting hours at a time, because
    the infrastructure is falling apart.
        Mr. MacLennan. Yes.
        Mr. Davis. Those have a tremendously negative impact on
    your business, correct?
        Mr. MacLennan. Significantly negative impact on our
    business, and that of our farmer customers, as well.
        Mr. Davis. Absolutely. In 2007, do you know Congress
    authorized NESP, the--planning to rebuild our crumbling
    infrastructure along the Mississippi and Illinois Rivers?
        Mr. MacLennan. Yes.
        Mr. Davis. But in 2010 the Obama administration ended the
    preconstruction engineering and design work for NESP, and
    actually requested zero dollars in the last Presidential budget
    for this project. I think you and I agree that this is
    something that is very crucial, and we hope the next
    administration will look at this and also look at some of the
    most necessary improvements.
        Can you, though, explain to the committee and explain to
    the administration through this committee your--from your
    position, why do we need to expand the locks from 600 to 1,200
    feet?
        Mr. MacLennan. Because when you have chambers that are, you
    know, that small, you can't get the tow boats through as a
    unit. You got to break up the barges, you got to break up the
    bulk. It is time-consuming, it is expensive. And that means,
    when you have a higher cost and a slow--a less-efficient
    transportation system at the locks, which--as you know, it is
    not a sexy topic.
        I mean people think about highways and airports. But in our
    districts and our business, things like locks, ports, riverways
    are vital to the ag and rural economy. But when you add that
    cost and time, it flows back to the price that ultimately gets
    to the farmers. And so they are realizing that that economy is
    then impacted because they can't get their products through in
    an efficient way.
        Mr. Davis. Well, and last question. On a scale of 1 to 10,
    how do you rank the improvements on the Mississippi and
    Illinois and our waterway systems, and the need to do that for
    your customers?
        Mr. MacLennan. Ten.
        Mr. Davis. I was hoping you would say, like, 11 or 12, but
    10 will do. That is OK.
        [Laughter.]
        Mr. MacLennan. So I will ``spinal tap.''
        Mr. Davis. OK.
        Mr. MacLennan. I will go to 11.
        Mr. Davis. Thank you, thank you. I really appreciate you
    being here, and thank you for your questions.
        And, you know, while I have got about 40 seconds left, I
    just want to say, you know, sometimes there are folks in my own
    party who don't believe we should invest in infrastructure. And
    we need to hear from you--and we did today--about how any
    investment in infrastructure helps to actually grow our
    economy, grow jobs, grow opportunity, and be a net benefit in a
    cost benefit analysis.
        And, Mr. Smith, quick question. Do you agree that we--when
    America invests in infrastructure, it is companies like yours
    that can continue to grow some of the best-paying jobs?
        Mr. Smith. No question about it.
        Mr. Davis. Thank you. I yield back the balance of my time.
        Mr. Shuster. Thank you. And, with that, Mr. DeFazio for a
    closing statement?
        Mr. DeFazio. Thank you, Mr. Chairman. I want to thank
    everybody. I think this was an excellent hearing. We kept you
    here a very long time. I think we found an incredible amount of
    common ground, and I intend to continue to push for us to
    actually finally put our money where our agreement has been,
    and get some of these things done.
        I just do want to note that the cost of congestion since we
    began the hearing for American individuals and business was
    $54,750,000. So it is time to stop that clock and get America
    moving again. Thank you, Mr. Chairman.
        Mr. Shuster. Thank you, Mr. DeFazio. And I saw a sigh of
    relief on the witnesses when I said Mr. DeFazio for a closing
    statement, so I will be brief, also.
        First, let me say thank you very much for being here. I
    know each and every one of you has a tremendous demand on your
    time. So we can't thank you enough for being here. I got to say
    this is one of the best panels that I have ever been involved
    with getting testimony from. Again, you are coming from
    different places, you got different products, you do different
    things, but there is common ground, as Mr. DeFazio--and that
    point being there is common ground.
        Somebody asked the question about informing the public.
    That was Pennsylvania, it was Mr. Smucker. And Pennsylvania
    model was that they did inform the Pennsylvania citizens. It
    was really the private sector that went out and really made the
    pitch to the taxpayers of Pennsylvania to get them on board to
    do this.
        So again, as we move forward, we are going to do our part,
    but we hope you folks will be out there banding together in
    your associations to educate the American people to the very
    basic--we talk about--you know, Mr. DeFazio just pointed out
    $54 million. That is a lot of money. One hundred and twenty
    billion dollars or so is what we--every year in congestion.
        The average American has no--it is a lot of money, but they
    have no idea what that means to them. So talking to them about
    what it does to the cost of a package or foodstuffs or an
    automobile or your equipment, what that costs them in real
    dollars, you know, basically down to a cup of coffee--is it a
    nickel more or a dime more because of the congestion you face?
    I think that is really an important message that we all have to
    get out there to the public.
        But again, this was--can't thank you enough--very
    informative. But it is all about building that 21st-century
    infrastructure for America. And I know you are all committed to
    it. This committee is committed to it, and we are going to work
    hard to see that we get this done.
        So thank you very much for being here. And I would ask
    unanimous consent that the record of today's hearing remain
    open until such time as our witnesses have provided answers to
    any questions that may be submitted to them in writing, and
    unanimous consent that the record remain open for 15 days for
    additional comments, information submitted by Members or
    witnesses to include in the record of today's hearing.
        Without objection, so ordered.
        I would like to again thank you very much for being here.
    And the committee is adjourned.
        [Whereupon, at 1:12 p.m., the committee was adjourned.]

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