Stephen Rees's blog

Thoughts about the relationships between transport and the urban area it serves

The forecasting problem

with 5 comments

A little while ago I posted Ben West’s piece on the Gateway forecast, which used a gas price of 80c/l. The chart above I stumbled upon. The source is Bespoke Investment Group and I have no idea who they are and I am not recommending them. And the chart could be updated to $135 a barrel last week.

The Gateway modellers used 2003 data, which if you look at the chart was just around the time when the trend turns upwards. Now, I am not saying that what they did then was wrong – although I think most modellers would throw in some additional “what if scenarios” or “sensitivity tests” just to show what could happen if the assumptions are out. And also note that other forecasters were blindsided by the way that oil prices have taken off. Just like the climate change scientists have been proved wrong. Climate change is actually happening much faster than anyone predicted.

What is bizarre, however, is the way that Kevin Falcon and Gordon Campbell are sticking to their guns. The forecast is now five years old – and obviously by steering the ship from looking at its wake, missed something very important up ahead. Like the fact that VMT in the US is actually dropping – and that has not happened on a month to month basis since 1979.

Of course, the Gateway folks want to pretend that their plan is not going to depend on people driving more. They like to maintain the fiction that it is “necessary” for the port to expand, which is why we “need” a twinned Port Mann, a widened Highway #1 and the SFPR. (Forget the fact that the freight goes by rail for now.) And, of course, if you steadfastly refuse to expand transit but fob people off with a $14bn pie in the sky, someone else will pay for it, transit “plan” you could even be right that many folks will have no choice but to keep on trucking. For rapid transit will not reach places like Langley in my lifetime the way things are going.

But the other things that have been happening, that this oil price spike illustrates, is the collapse of the US dollar and the horrendous impact this is having on trans-pacific trade. Which was supposed to grow rapidly, forever, according to the Port officials, but has actually been declining. Because China now prefers to ship to Europe whose currency is much stronger.

It is very unfortunate that in North America there is a perception that being decisive and holding your ground indicates a strong politician. One who adjusts policies to changing circumstances is said to “flip flop” or be indecisive. As a result we have had a long history of quite dreadful decisions based on “stay the course” when it is quite obvious to all around that it is monumentally stupid to do so.

The world has changed. America is no longer #1. The dollar is not the most favoured store of value. The US economy is not growing. They do not like to use the word “recession”, but that is the one that everyone outside the US is thinking. Gateway was never a very good idea, because it ignored a whole number of external influences. It assumed away any inconvenient facts. But that was then. Now it looks like the daftest idea since prohibition. Because it assumes that the Port of Vancouver can get more trade here that would otherwise go through US west coast ports.

“When circumstance change, I change my mind. What do you do?” (often attributed to John Maynard Keynes, though there seems no evidence that he said it)

Written by Stephen Rees

May 25, 2008 at 7:57 pm

Posted in Gateway

5 Responses

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  1. But, Gateway was never really about transportation, rather it was a scheme to give the road Builder’s Association much work and the trucking industry more heavily subsidized roadways.

    Cynically, I believe Gateway is just one of many secret deals promised to Liberal benefactors and is the main reason Campbell & Falcon refuse to change it one iota.

    Malcolm J.

    May 25, 2008 at 9:15 pm

  2. Malcolm J. said:
    Cynically, I believe Gateway is just one of many secret deals promised to Liberal benefactors and is the main reason Campbell & Falcon refuse to change it one iota.

    I’m with Malcolm. Falcon stubbornly sticks with this thing when the brightest transportation people we have say it’s dumb. This is why so many of us dislike politicians. They get elected and suddenly they act as though they’re experts in a field they knew nothing about before getting elected. Who is advising these guys anyway? Stupid question, I don’t think they are looking for advice.

    These clowns talk about becoming greener but the hypocrisy is absolutely stunning.


    May 25, 2008 at 10:18 pm

  3. Great post.

    I would love to see the Ministry of Transportation start over with this one. This time they should consider actual alternatives rather than just designing alternatives to fail, as the City of Burnaby quite correctly called it ( Even so, they haven’t even done justice to these terrible alternatives. See Chapter 3.2 of this document for details, where they pretty much just swat single-pronged alternatives down with only the most superficial analysis:

    Of these single-pronged alternatives, the best one is system-wide tolling. Here’s their justification for dismissing it:

    “System-wide tolling of existing bridges would mitigate the diversion of traffic from a tolled Port Mann Bridge, as presented in Chapter above. However, in order to achieve traffic flow conditions at the Port Mann Bridge comparable to those predicted with the PMH1 project, individuals would require adequate opportunities to use alternative modes that are not contemplated within TransLink’s 10-Year Plan (TransLink, 2004). As such, imposition of a system-wide congestion toll could have significant detrimental impact on the region’s economic development (Gateway Program, 2006).”

    How about, in conjunction with tolling, spending a comparable sum to the bridge/highway on transit instead, to go beyond TransLink’s 10-Year Plan? Perhaps a different conclusion would be reached then, rather than when doing nothing extra on transit. What a mockery of process they’ve made – they haven’t even given the superficial analysis treatment to more sensible, multi-pronged approaches, such as a combination of more transit, queue jumpers, and system-wide tolling.

    The MoT consistently deals with tough questions by dancing around them, saying they’re “out of scope”, or, as was the case when they said current gas prices have been offset by amazing new car technology in the past 4 years (so there’s no need to adjust their models), outright lying. As you’ve noted, Mr. Rees, they refuse to acknowledge the centuries-old concept that transportation shapes development, and refuse to consider the full impact of induced traffic.

    By framing a possible change of mind on Gateway in environmental terms, the Liberals could probably even emerge unscathed south of the Fraser. It’s not too late, yet, but time is definitely running.


    May 25, 2008 at 11:04 pm

  4. I was just over browsing NY Streetsblog, and saw that one of their stories was about students *protesting* against the high gasoline prices.

    Generally, I think of protesting as an activity that takes place in the face of some injustice or deliberate wrong. High gas prices aren’t some conspiracy, just the situation that arises when there’s too many users, and not enough supply.

    Is it just me, or does *protesting* against high gasoline prices really do nothing more than demonstrate the ignorance of the protesters to the situation at hand?

    Why not put that energy into moving your stuff into a walkable neighbourhood and selling your SUV? Now that would be a constructive thing to do.


    May 25, 2008 at 11:13 pm

  5. It’s not just you Corey. High fuel prices are a positive factor for our environment. What kind of students were these anyway? Maybe someone paid kids to pose as students.


    May 26, 2008 at 4:36 pm

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