Tuesday, June 12, 2012

WalMart Nation

1. Trains. We saw them on Route 66, day and night, from LA to Albuquerque. We rode parallel to the tracks, waving at the engines. Once in a while we got a whistle blow. Many times we crossed tracks on roads. We heard trains before going to sleep at night, at 3 am, after breakfast while packing the van. Long freight trains, many cars and engines long. The whistles and rumbling of the cars is the music of Route 66.

Of course the roads that made up Route 66 were built along the railroad right-of-ways. No mystery there.

What we all noticed was the number and length of the trains. So many cars! A lot of momentum, a lot of diesel burned. We were witnessing the moving of goods on a grand scale. On a global scale, in fact.

Anyone can see that most of the cars are boxcars and if you look carefully, containers that can travel by ship, rail, or truck. So the next thought comes automatically. WalMart. These containers came off a ship from China at the Port of Los Angeles. They're making their way inland to a WalMart store near you. Again, the scale of this logistics project - staggering.

Another puzzle: why not the interstate? We saw semi trucks every day on I-40, and we saw the truckers at  truck stops, roadside casinos, and DQs. What are those folks doing, if not moving goods? We figured that those containers must be doing the long haul distances. Long haul, big volume. It's probably more cost-effective to use rail for long distances and many containers.

But somewhere around Bagdad Cafe a question was nagging at me. Trains were heading westward too. Almost as many trains going west as east. I was stumped. I asked Lon 'what kind of goods could possibly be produced in the east and consumed in the west'? I couldn't think of a single thing Danny or I consumed that was produced east of the Mississippi. Sure, a few trains pulled cars with FedEx and UPS logos on them, but they were in the minority. Probably carrying Internet purchases. Probably from Amazon.com ;-)

Lon guessed that the containers on westbound trains were empties heading back to LA and then China. Of course! The empty cars and the full cars look the same from the outside.

2. Coincidentally, this trip caused my first-ever visits to WalMart.

  • The pre-ride weather forecast required serious plastic bag-gage. On Easter Sunday, we ended up at WalMart in my town. It was the only place open that sold huge Ziploc bags. After 15 years, there was no avoiding a trip to WalMart.
  • 2 weeks later in Grants, NM, Veronica and I walked to WalMart in the dust storm. I got breakfast: Chobani yogurt, donut holes, and Starbucks Via. Even if we had been able to get to downtown Grants (the Route 66 part) I'm not sure there would have been a market there. In Grants we could see the original value proposition of WalMart at work - bringing affordable basics to rural (poor) communities. It's hard to oppose that, at least in principle.

As we observed the mighty WalMart supply chain in action, I was actually getting sucked into that supply chain!

3. While researching this post, I became aware that WalMart is moving into the area where I grew up. Economically speaking, an area not unlike some of these communities on Route 66. Still. There's no railroad to move goods from the Port of Oakland 300 miles north. A lot of trucks will need to move up and down Highway 101. I wonder what infrastructure changes WalMart will try to advocate for, politically, in this economically fragile region. Fingers crossed...

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