Midwest Governors on Separation of Watersheds: A Closer Look at What's at Stake

CAWS photo early infrastructure.jpg

River entry to canal


Photo from the University of Illinois

Two important messages on aquatic invasive species came out of the recent 2013 Leadership Summit, where the Great Lakes Governors and the Premiers of Ontario and Quebec gathered to discuss a new collaborative agenda for the region. The messages – from Governor Pat Quinn of Illinois and Governor Mike Pence of Indiana – illustrate a potential divide between these two neighboring states when it comes to invasive species, in particular the voracious Asian carp making their way up the Illinois River towards Lake Michigan. While Governor Quinn spoke in favor of hydrological separation of the Great Lakes and Mississippi River Basins, Governor Pence came out critical of separation. It appears, however, that Governor Pence may be basing his position on inaccurate or misleading information about separation and its impacts on the region, fueled by industry’s interest in keeping things business-as-usual on the inland waterways. Let’s take a closer look.

In his first public statement of support for separation, Governor Quinn this past weekend noted that “I really feel [separation] is the ultimate solution. We have to do it.” This statement came after many years of public debate and studies looking at the feasibility of separating the basins. Quinn went on to acknowledge that fishermen and electric barriers are not enough.

Pence, in contrast, focused on the potential economic impacts, stating according to one news article that “any effort to close the Chicago-area waterway system to control the spread of Asian carp would be harmful to our economy” and noting that the waterways provide a “southern transportation route for freighters carrying $1.9 billion in goods annually from Indiana factories and farms.”

Why should Governor Pence take a closer look with us? First, no one is advocating to *close* the inland waterways system to waterborne commerce. Rather, proponents of separation are assessing a limited set of locations for physical barriers and engineering solutions that would enable the continued movement of goods along the waterways, as shown in one conceptual rendering by the engineering firm HDR, Inc. for the Great Lakes Commission. Similar infrastructure is used in other parts of the world, and could be incorporated into a separation plan here. Looking at separation also provides opportunities both to improve the Chicago Area Waterway System (or CAWS) itself by updating crumbling infrastructure along the CAWS and to improve other aspects of Chicago’s freight system, which is notorious for its delays and back-ups. With forward-thinking ideas and careful planning, it is very likely that any delays from creation of barriers in the waterways could be more than offset by new efficiencies in other parts of the system.

Second, the figure of $1.9 billion is misleading in its portrayal of the value of the goods moving along the inland waterways to and from Indiana businesses. Waterborne freight is a mode that, according to the Army Corps of Engineers, represents only a very small fraction of the goods moving through the Chicago metro region - and this fraction is on the decline. While the news articles on the governors' statements don’t provide the source for the cited $1.9 billion figure, we did a little digging and found this study commissioned by – not surprisingly – the Port of Indiana. The report looks at the economic impacts associated with maritime activity at the Indiana Lakeshore terminals, including goods that move along the inland waterways and through the O’Brien Lock to and from Indiana. By defining a very broad conception of economic value, the report comes up with a figure of $1.9 billion from goods movement through O’Brien. What do I mean by a very broad conception? As an example, the report looks at the “induced,” “indirect” and “related” jobs associated with those goods – essentially everyone who is somewhat impacted by the movement of the goods (for instance, office supply providers).

I don’t take issue with this type of analysis overall. But reporting that the goods have a “value” of $1.9 billion is misleading: the more common and familiar way of reporting value when speaking about goods movement is to report the market value of the goods, oftentimes with the tonnage. Taking this approach to goods moving along the inland waterways, a few numbers show a very different story for Indiana. First, according to a study conducted by Cambridge Systematics for NRDC, using a database developed by the Federal Highway Administration, the greater Chicago freight system in 2007 moved 1.17 billion tons of goods worth $1.3 trillion. The same study notes that maritime movement accounted for just 0.2% of that value, or $2.6 billion. At the same time, the Army Corps’ report on cargo moving through the region found that Indiana accounted for only 6% of shipments and 6% of receipts on the inland waterways. Conservatively assuming that all of these shipments and receipts would go through areas of the CAWS potentially impacted by separation and multiplying those percentages times the total value of maritime goods yields a high end ballpark number in the range of several hundred million dollars – far short of $1.9 billion.

Several hundred million dollars is not nothing. But it certainly is not reason to halt discussions over a much-needed solution to our invasive species problems, one that will bring numerous benefits to the region – in terms of improved water quality, reduced flooding, and other system improvements – in addition to carp and other species prevention. Nor, as noted above, will this goods value disappear in its entirety because the CAWS will not be closed to goods movement. If we dedicate ourselves to generating creative solutions looking at the goods movement system as a whole, we can both address the invasives threat AND have a healthier goods movement system.

In the end, why should Governor Pence pay heed to his Illinois colleague’s position? One very basic reason: with a far greater percentage of goods movement on the waterways impacting the Illinois economy, Quinn has a lot more to lose if separation really is the economic torpedo industry has made it out to be. That he has come to support separation over time is a strong indicator that it is not.

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