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Emil Frankel interview

Friday, October 17th, 2003 - 20:00
Phrase: 
Ms. Frankel is the Assistant Secretary for Transportation Policy for the United States Department of Transportation
Radio show date: 
Sat, 10/18/2003
Guest: 
Intro text: 
Missions and Programs; Leadership; Strategic Thinking; Collaboration: Networks and Partnerships; Innovation ...

Missions and Programs; Leadership; Strategic Thinking; Collaboration: Networks and Partnerships; Innovation

Complete transcript: 

Friday, August 8, 2003

Arlington, Virginia

Mr. Lawrence: Welcome to The Business of Government Hour. I'm Paul Lawrence, partner in charge of The IBM Center for The Business of Government. We created the Center in 1998 to encourage discussion and research into new approaches to improving government effectiveness. Find out more about the Center by visiting us at the Web at www.businessofgovernment.org.

The Business of Government Hour features a conversation about management with a government executive who is changing the way government does business. Our conversation this morning is with Emil Frankel, Assistant Secretary for Transportation Policy at the U.S. Department of Transportation.

Good morning, Emil.

Mr. Frankel: Good morning, Paul.

Mr. Lawrence: Joining us in our conversation is David Abel.

Good morning, Dave.

Mr. Abel: Good morning.

Mr. Lawrence: Emil, let's start by setting some context. Could you tell us about the missions and the programs at the Department of Transportation?

Mr. Frankel: Well, let me emphasize that the Department of Transportation, the U.S. Department of Transportation, unlike the various state agencies -- and as I think you all know, every state has a state department of transportation or its equivalent -- the state agencies, or local transit authorities and so forth, are owners and operators of transportation systems, in the case of the state transportation agency of a highway system, let's say, or a transit agency like the MBTA in Boston, the owner of the transit system there.

That's not the case, generally speaking, with the U.S. Department of Transportation. The USDOT is an agency which at the federal level makes policy, develops and proposes policies and is essentially a grant-making agency; that is, we make grants to state and local regional transportation agencies.

There's some exceptions, obviously. The Federal Aviation Administration operates the air traffic control system, and a lot of the people that work for the Department of Transportation obviously are engaged in operating that system. But even the FAA, a principal role of it is to make grants for development of airports and so forth.

The Department itself is organized, I think of it like a large corporation with a holding company, a small holding company -- the office of the Secretary -- and most of the resources and personnel are in what I might describe as subsidiaries or operating administrations like the Federal Aviation Administration, the Federal Highway Administration, Maritime Administration and so forth. And those are the entities that really engage most directly with the stakeholders, with state and local agencies and/or the grant-making agencies.

Mr. Lawrence: How do you describe the size of the Department in terms of the people, the dollars, and even the skills of the people?

Mr. Frankel: The Department has a budget in the range of $50 to $60 billion annually and about 60,000 employees. I might say that's a dramatic reduction, because on March 1, something in the range of 80,000 or 90,000 employees left the Department of Transportation, transferred to the Department of Homeland Security. The Coast Guard had for 35 or 40 years been part of it since the inception of the Department of Transportation -- had been a big and important part of DOT. It was transferred to the Department of Homeland Security. And then the Department of Transportation created from nothing, I might say, over a period of a year, the Transportation Security Administration, which has a significant budget, obviously, and 50,000 or 60,000 employees. They were also moved to the Department of Homeland Security.

So while USDOT remains a very large and significant federal agency, it's numbers have been reduced dramatically. The individuals -- it varies, I think, from operating administration to operating administration; the Federal Highway Administration, which has antecedents going back a century, Bureau of Public Roads and so forth, in existence, which predated the Department of Transportation -- is dominated, as are many state transportation departments, by kind of a civil engineering culture. They're career people, largely planners and/or civil engineers. That isn't necessarily the case with the Maritime Administration or the Federal Transit Administration, for example.

So people have a kind of public management, transportation planning and/or engineering background, in terms of the career people.

Mr. Lawrence: Your office, the office of the Assistant Secretary for Transportation Policy, how does that fit within the overall structure of the Department?

Mr. Frankel: We are part of the Office of the Secretary, that holding company to which I made reference. I might say, under Secretary Mineta's leadership, there's been a greater emphasis on the function and policymaking resources available directly to the Secretary.

Even though I'm responsible for a staff, I'm really more in the nature of a staff advisor to the Secretary of Transportation, the Deputy Secretary. And I work most closely and really report to a new position created at the Department, Under Secretary for Policy; Jeff Shane. And Jeff has responsibility for policymaking in the surface transportation modes, the aviation modes, and also responsibility over, you know, the policymaking functions. or a oversight, if you will, of policymaking functions in the various operating administrations.

So I'm in the role, particularly in the surface modes; that is rail, transit, highways, maritime, not aviation. I am not particularly involved in aviation policy, only tangentially. I develop policies and advise the Secretary and the Deputy Secretary and the Under Secretary, work closely with the operating administrations in the development overall, kind of 1DOT policies.

Mr. Abel: You have a very interesting background that kind of brought you to your current role in the Department. Can you tell us a little bit about your previous experiences before joining the Department?

Mr. Frankel: I came to Washington, as many young lawyers do, pretty much right out law school, not a year or two out of law school, and worked in the public sector here in Washington. I worked on Capitol Hill as a legislative assistant to United States Senator Jacob Javitz of New York, and then went to work in the Housing and Urban Development, where I was a special assistant to the Under Secretary, who was then the number two person in the Department of Housing and Urban Development. A fairly kind of typical young lawyer's story.

And then I went back to my home state of Connecticut and spent 20 years in the private sector, practicing law, but principally working with a national company that was involved in business reorganizations, real estate workouts, crisis management. Most of that time, I was involved in politics and public affairs, particularly at the local level, and also to some degree at the state level.

And then I had an opportunity to go back full-time into the public sector in 1990, 1991, and I became Commissioner of Transportation of the State of Connecticut. And I might say I had absolutely no background in the transportation field when I was asked to become Commissioner of Transportation. It's something I expressed to then Governor-elect Weicher, and he said he was sure that based frankly on my experience with the Pomery Company in doing crisis management, he was looking for a manager more than a transportation expert.

But I have been in the transportation field now since 1991. It's a fascinating field. It's given me a whole second career, and after four years as Commissioner of Transportation in Connecticut, I went back into the private sector as a lawyer and a consultant and an academic, spending not full-time, but part-time on the faculty at the Yale School of Management and the Yale School of Forestry and Environmental Studies, focused on transportation policy and public management, transportation and environmental issues.

So that was a way of keeping me at the cutting edge of those issues, along with the consulting that I did. And, you know, local level, chairman of my town's board of finance, and a member of the board of selectmen of my town. Those of you who are listening or are from New England will understand what boards of selectmen are, but nobody outside of New England will understand what a board of selectmen does, but I was a member of the board of selectmen.

Mr. Lawrence: How did working at the state level prepare you for working at the federal government level in transportation?

Mr. Frankel: It was for me a very, very important experience. And not very many of my colleagues at the political appointment level -- and unlike the career people in the Department --but not too many of them have worked at the state or local level; a few of us have. The Federal Highway Administrator, for example, was like secretary or director of -- in her case, the Arizona Department of Transportation, and others. But I find that the experience I had at the state level was absolutely invaluable in helping me shape and advise the Secretary on policies, because I've been at the other end of this.

The USDOT is pretty good in the surface modes. USDOT's principal clients or customers are, as I said before, you know, we're not directly, for the most part, owners and operators of the system. So our clients and customers are those people who are the owners and operators of the system. And I've been there, so I've been on the customer side of this. And I have a feeling and an understanding, as well as, frankly, a whole set of relationships still with people who were my counterparts

And I missed something. I'd been gone from Washington for 30 years when I came back, so there were a lot of things -- I had to get kind of reacclimated to the politics of Washington and Congress and so forth. But on the other hand, I think I brought a perspective in terms of policies and programs and issues at the state and local level which was not necessarily widely shared among my colleagues, who had, many of them, a lot more experience obviously than I in Washington.

And there's a sense of the issues and what really ultimately is of concern to the users of this system, who for all of us are the ultimate customer. So I think it's hopefully given me a -- I can't say it's made me more valuable than somebody who brings different experiences, but it brings a different perspective, and one that I think that the Secretary and the Deputy Secretary and my other senior colleagues value and appreciate.

Mr. Lawrence: How would you contrast the management styles of the two different levels of government?

Mr. Frankel: First of all, as Commissioner or Secretary of Transportation at the state level, I had line responsibility. I don't principally, as I mentioned before, have line responsibility here. So there's that distinction. But at the state level, there is a blend of policy. You're the principal policymaker for the state. A smaller sphere obviously, but nonetheless, for the state. But you're also dealing directly with customers and getting projects built; providing services, being responsible for the operations of the system.

You know, my administrative assistant when I was Commissioner in Connecticut had orders that periodically, she was to let through a customer, a user, a constituent, who had a complaint about the Department of Transportation and people -- I got a lot of calls from people who were stuck in traffic jams and so forth. So you're dealing directly. You are in the trenches at the state level or a transit director and so forth, which for the most part is different from those of us who are working here at USDOT.

Mr. Lawrence: That's a good point, especially about the line responsibility.

How is the environment affected by transportation policy? We'll ask Emil Frankel of the U.S. Department of Transportation to explain this relationship when The Business of Government Hour returns.

(Intermission)

Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, and this morning's conversation is with Emil Frankel, Assistant Secretary for Transportation Policy at the U.S. Department of Transportation.

And joining us in our conversation is Dave Abel.

Emil, one of the highest priorities of the Department is the Surface Transportation Reauthorization Bill. Could you give us the history of this bill and why it's needed?

Mr. Frankel: Well, the current authorization bill -- and this is the legislation which authorizes virtually all of the surface transportation grant programs: highways, transit, safety, federal motor carrier safety. The bill which contains or is the current authorization expires September 30, so in about six weeks. So it is necessary for Congress to adopt reauthorizing legislation prior to the beginning of the next fiscal year. Whether we'll get to that is another question. But nonetheless, that's what prompts this.

I might say this is an extraordinary year, 2003, which may continue into 2004, but the current authorizing legislation, known as TEA-21, the Transportation Equity Act for the 21st Century, which was finally adopted by Congress I think in early 1998, as I mentioned, expires September 30. The authorizing legislation for the aviation and aviation grant programs, AIR-21, expires September 30, and Amtrak's Intercity Passenger Rail has been operating without an authorization. It's authorization expired September 30 of last year. So as a good friend of mine has mentioned, this is a trifecta, dealing virtually with all of the programs of the Department and most of our budget, virtually all of our budget.

Specifically with regard to TEA-21, or the surface transportation programs, we have been involved in drafting a proposal by the administration for the successor bill since early 2002, really, so now 18, 19, 20 months. Frankly, we would have started almost at the beginning of this administration had it not been, of course, for the events of September 11, and the Secretary, the Deputy Secretary, the top leadership of the Department were so focused on aviation security issues.

But we got to this and we created a process of reaching out to stakeholders, involving hundreds of people within the Department itself in developing legislation, the administration's proposal, which was in fact introduced in May, I think, of this year, and Congress had been holding hearings on this for some period of time. So Congress is now grappling with reauthorization. And the administration's proposal is known as SAFE-TEA, the Safe Accountable Flexible and Efficient Transportation Equity Act of 2003. SAFE-TEA is our proposal to succeed TEA-21.

Mr. Lawrence: It certainly is easier to say that way than to pronounce the entire name of the bill each time.

Mr. Frankel: It certainly is.

Mr. Lawrence: Let's dive a little bit into the detail of the reforms in the bill. Can you give us some highlights of the programmatic reforms that the bill contains?

Mr. Frankel: It is a reform bill, but it also builds on its predecessors. There was revolutionary legislation adopted, as you well know, in 1991, ISTEA, the Intermodal Service Transportation Efficiency Act, in which, I might say, the current Secretary, then a congressman from San Jose and very senior on TNI, Norman Mineta, was a principal author of that along with Senator Moynihan, Senator Chafee of Rhode Island, and others.

And this was really quite revolutionary legislation. It really proposed significant programmatic, and adopted very significant programmatic, reforms in the surface transportation programs. Then TEA-21, which was adopted eventually -- actually, there was some lapse between ISTEA and TEA-21, but it was eventually adopted in early 1998. These are generally six-year authorization bills; had significant fiscal reforms, or financial reforms, upgrading instruments, essentially designed to make sure that the money raised from the transportation system, motor fuels, taxes, gasoline taxes, would be reinvested in the transportation system, and would be done so as promptly as we could determine what those proceeds or revenues were.

So when we developed safety, we tried to build, strengthen and build on those reforms and those significant features of those two predecessor bills. On the other hand, as the title indicates, we have a very strong emphasis on safety in this bill, highway safety. As the Secretary and others have pointed out, and the administrator of National Highway Traffic Safety Administration, while we've made dramatic reductions in the rate of fatalities on our highways, the numbers are still unacceptable and actually growing. About 43,000 people lose their lives on our highways every year. Think about that if it were an epidemic of some sort. Think about that: if 43,000 Americans died as a result of terrorist attacks on an annual basis; we'd do something about it.

So we propose to do something about it in this bill. And we have proposed consolidation and performance bonuses for states, building on states' discretion and states' flexibility in how they achieve results, but basically rewarding them if they do achieve results. We try that principal of flexibility, discretion on the parts of states or transit agencies, regional authorities, but holding them and rewarding them for performance achievements runs through this bill in many specific ways. But I think that those themes, and the emphasis on safety; getting states to adopt primary seat belt laws or to make improvements in seat belt use; reduction of driving under the influence, and rewarding states, those are, I think, principal emphases of the administration's proposal, and we hope will be provisions contained in the final enactment.

Mr. Abel: In the bill itself, there are some significant areas that are built upon the authorization that's currently in place. How much will the legislation cost and how is it paid for? What are some of the ways that the work will be funded?

Mr. Frankel: Well, that's a major source of contention. That's frankly, probably the primary reason that reauthorization legislation hasn't been adopted, even though we're only six or seven weeks away from the expiration of TEA-21.

The administration's proposal is a almost $250 billion program over six years, which is the largest program ever proposed, largest amount of funding ever proposed for the surface transportation programs, but there's quite a gap. I mean, the bipartisan leadership of the key jurisdictional committee in the House, the Committee on Transportation Infrastructure, is talking about a $375 billion, six-year program. Some of the committee leadership in the Senate is talking about a $310 or a $311 billion program, so those are wide gaps. But our program is very, very significant; builds, as I said, on record funding in TEA-21. But we are proposing to do it principally by existing revenue sources.

The President has made it clear he does not favor an increase in the gasoline tax, so we are projecting growth in the gasoline tax as well as some augmentation; transfer of a tax currently imposed on ethanol or gasohol from the general fund to the Highway Trust Fund as primary sources. So that there would be growth of 15 to 20 percent SAFE-TEA over TEA-21, but TEA-21 grew at a rate of about 40 percent plus over the prior legislation.

Mr. Abel: You mentioned earlier that the legislation builds upon state and local flexibility in executing transportation policy. Why is building on that flexibility important for transportation policy?

Mr. Frankel: Transportation -- and one of the things that makes it so interesting is that is the most mundane, personal and local of issues and also the most global and international of issues you think about, and that's one of the things I think that engages people's interest.

You think about conversations around the coffee machine and gee, how did you get to work today, how long did it take you to get to work today, and people complaining about traffic jams and so forth. On the other hand, how transportation investments are made really determines the growth of our economy, where communities are situated, how they grow. It deals with international trade issues, movement of goods. So it has this broad impact that we're dealing with, and we have to be sensitive to both those issues.

And I think the decisionmakers -- and the owners and operators of this system, as I mentioned, after all are, you know, the Connecticut Department of Transportation or the Los Angeles County Metropolitan Transit Authority. They're the owners and operators of the system, and the decision about where and how investments should be made, it really should be made at the local level. The Secretary, who was, you know, was mayor of San Jose before he became Congressman Mineta, talks about his frustration about decisions being made in his case often by, not the federal government, but the California Department of Transportation, which affected issues in San Jose.

And one of the things he set out to do in ISTEA was to make sure that there was greater discretion and engagement on the part of local officials and where that highway was going to go and what that bridge was going to look like and what the level of transit services would be.

So the state and local people, the regional people, are the ones who are engaging the customers, so they need to have broad discretion. But they also need to be held to performance and accountability, because they oftentimes are using 80 percent federal funds for projects, and they need to be accountable and they need to be sensitive to national goals, national considerations; our ability to move goods and freight across the country, for example.

Mr. Lawrence: How does one manage the development of an integrated policy? We'll ask Emil Frankel of the U.S. Department of Transportation to tell us how this is done when The Business of Government Hour returns.

(Intermission)

Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, and this morning's conversation is with Emil Frankel, Assistant Secretary for Transportation Policy at the U.S. Department of Transportation.

Joining us in our conversation is Dave Abel.

Emil, one of the things I meant to ask you in the last segment was about the environment and how the environment is affected by transportation policy. And what's in the bill to address that?

Mr. Frankel: I think you really, Paul, have to go back to ISTEA, and one of the real revolutions or significant reforms in ISTEA under the leadership of Congressman Mineta and Senator Moynihan and Senator Chafee and their colleagues was a recognition of the impacts of transportation on the environment. There have been antecedents. I don't mean to say that it was going from nothing to something, but there was much, much more sensitivity to the impact of transportation on the environment, on quality of life, on community growth and development, and trying to mitigate those impacts and shape those impacts.

That continued. They were preserved and strengthened in TEA-21, and we intend in this bill to do the same thing. We have some reforms that we have proposed, in some cases strengthening the environmental impacts, being very sensitive to the environmental stewardship. On the other hand, we are also sensitive to the fact -- and there was a mandate in TEA-21 that the Department do something about streamlining, improving the processing of environmental permits in connection with transportation projects, because too often delay is used as a way of people opposing or preventing projects from going forward.

Good projects should go forward. Bad projects should be killed. And we have a process on the books, you know, the National Environmental Policy Act, NEPA, and the preparation of environmental impact statements, the Air Quality Act, all these things create processes, require a balancing of transportation and environmental impacts, but also create a decision-making process. And one of the things we hope to strengthen in this bill is to create a basis on which decisions can be made in a timely manner about projects which are respectful of their environmental impacts.

Mr. Abel: Let's tie together the previous two segments. We were talking a little bit about your role in the Department and we talked a little bit about the safety proposal. Let's bring those together. Can you tell us the role that your office played in formulating the safety proposal?

Mr. Frankel: We were the coordinators, facilitators, quarterbacks, if you will. I mean, if you want to think about the Secretary, he certainly is the CEO or the coach, general manager, coach, I'm not quite sure what the right metaphor is. But in our case, we tried to bring together all the processes, because each of the modes, Federal Highway Administration and Federal Transit Administration, National Highway Traffic Safety Administration, all of them had significant parts of this bill, their titles in this bill, and the bill we're proposing in the final act for each of those agencies, so they got to make their contributions.

But we tried to create a process that got across modes, because one of my former colleagues in the Department has said that she felt the I in ISTEA, Intermodal service, is still the challenge unmet. You know, other Secretaries, including this Secretary, have talked about 1DOT, crossmodal things. We tend to still be quite stovepiped, if you will, into the separate modes: highways, transits, and so forth. And getting across them, thinking intermodally, thinking across modes in terms of movement of people and goods, and so it really needs to permeate the legislation, and that's one of the things we tried to bring to bear.

Are we there? No, by no means. But hopefully there will be continued improvements in this bill. So our role was to coordinate and to drive towards the development of the final bill, final proposal by the administration and then go through the long but interesting process of getting clearance through the administration, getting all of the -- because this is, after all, the President's bill. This is President Bush's proposal; it's certainly not mine, and it's not even Secretary Mineta's, which means the White House and OMB and all the agencies that this impacts, the Environmental Protection Administration, it impacts the Department of the Interior, the National Park Service; all of those are affected by elements of this bill, and so you go through a process. And again, our office was really the key manager of that process.

Mr. Lawrence: You mentioned the intermodal issues were difficult to address. What are some of the other difficulties that you faced in coming up with safety?

Mr. Frankel: Well, I think the most significant remains the outstanding issue, and that is the funding levels. I think we are ambitious, but prudent. But there certainly is pressure to spend more. And one can justify it.

One can justify it in terms of long-term growth of our economy and our dependence on our infrastructure, not only transportation, but all elements of network services, whether we're talking about electric power or water or similar things, water treatment. They're all key elements in a growing economy. If we don't have a strong infrastructure, in this case, the transportation infrastructure, the economy will suffer in the long run.

There's also the short-term impacts; that a billion dollars in transportation investments supposedly creates 47,500 jobs each billion dollars of investment. So there are also the short-term impacts of a public works -- it is a major public works program. It is far and away the largest public works program of the federal government. So the balance of trying to achieve and continue to improve the infrastructure so it can satisfy those broader economic considerations, balancing those with what we've just been talking about, the environmental impacts, the impacts on community life and quality of life generally, remain always the great challenges and the great interests, I think, of developing transportation policy and legislation.

Mr. Lawrence: You talked about coordinating with EPA and the Department of Interior, so I'm curious, how do you go about coordinating with agencies and departments outside the Department of Transportation to develop integrated policies?

Mr. Frankel: Well, there's an informal process and there's a formal process. As we were developing the administration's proposal, SAFE-TEA, what became SAFE-TEA, we reached out -- and let me say the -- I'm going to give an example. The Department of Interior, National Park Service, we set up a meeting with my counterpart, the Assistant Secretary for Policy at the Department and the National Park Service. There had also been a series of discussions between the National Park Service and the Federal Highway Administration at a technical or career level.

The President had made a commitment, as you know, to deal with maintenance backlog and improving the road system in the national parks, and that funding comes to a very large degree from the Highway Trust Fund and has to be contained within this bill. So that was one of the key things we talked about. It actually lead to discussions between Secretary Norton, Secretary Mineta, about that issue, getting a level of funding. And we have in fact proposed record levels of funding in our bill for investment in the improvement of national park roads.

So we tried to work all that out before the bill was actually completed within the Department and put it in the formal clearance process, then went back through, for example, the Department of the Interior, and they reviewed it and made sure that we did what we had promised we were going to do. And sometimes there are details -- yeah, you've done it, but there's this little problem and I think this has to be edited. And that really affects the details of the bills as well. But there is this process, and we had a similar process in dealing with improvements I think we've made in the Clean Air interface with transportation, discussions we've had with the Environmental Protection Administration.

Mr. Lawrence: It seems complicated but straightforward, because there's only one Department of Interior, but how about when you have to deal with the states and the local department of transportations; how do you develop, coordinate a policy then?

Mr. Frankel: We have conversations. Mary Peters, who's the federal highway administrator, Chip Nottingham, who is the associate administrator for policy, both have experience at the state level, more recent than mine actually. But the three of us and others who have a range of relationships with state and local people, we pick up the phone a lot of times and just talk to them, or they pick up the phone and call us.

There also is a, for example, a trade association. There's a trade association for state transportation officials, ASHTO, and there's a trade association for transit agencies, the American Public Transit Association, APTA. So we deal a lot with their staff as well. And stakeholders contribute, and we reach out in a lot of formal meetings, but also a lot of informal discussions we have to get their ideas and thoughts.

Mr. Lawrence: In your office's role as acting -- in your term, it's a good term -- in acting as the quarterback for a lot of these collaboration activities, do you have lessons learned that you can extract from that that perhaps we, our listeners, can apply to the collaboration activities that we face on a daily basis?

Mr. Frankel: I think in an area like transportation, for the reasons we've been discussing and the factors we've been discussing, it is very, very important that you need to lay out a vision. And I think that's been true, pretty much, at the national level, going back particularly to ISTEA, so for the last 10 or 15 years. You need to lay out a vision. But you also need to listen to your customers and have to be responsive, so that striking that balance, developing a consensus on a piece of legislation like this, which is authorizing grant programs -- so you need to fashion them both in, I suppose, their amount, but their character, in a way that's going to be acceptable and easily applicable by the grant recipients, is, I think, one of the real challenges, but hopefully, something, you know, we can learn from it. It is different from being an executive in a hierarchal organization.

I was struck, when I was at -- the Connecticut Department of Transportation actually did a lot of thinking and tried to do a little bit of writing about the issue of the differences in the management in the public and the private sectors. And there, of course, are many. Some would argue it's more difficult to manage in the public sector, for some of the reasons we've discussed. But clearly an important factor, whether it makes it easier or harder, is that you can't just issue orders and expect that it's going to happen that way. I mean, a CEO of the XYZ Company is very different from the Secretary of Transportation in terms of being able to achieve results.

Mr. Lawrence: That's an interesting comparison of the sectors.

It's hard to leave any discussion about transportation without mentioning the railroads. What's the latest on our rail policy and what are the implications for Amtrak? We'll ask Emil Frankel of the Department of Transportation to tell us more when The Business of Government Hour returns.

(Intermission)

Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, and this morning's conversation is with Emil Frankel, Assistant Secretary for Transportation Policy at the U.S. Department of Transportation. And joining us in our conversation is Dave Abel.

Mr. Abel: Emil, you've been closely involved in formulating the administration's policy on Amtrak. Before we get into what some of the policy propositions are, can you give us a little bit of background as far as the state of rail transportation in America and what some of the pressing issues are?

Mr. Frankel: Well, let me first of all, Dave, limit my remarks here to passenger rail. There are a whole set of very interesting and very important issues on freight rail, and freight rail is part of a broader system of moving goods. I might say, and I'll come back to passenger rail in a second -- that while we have made some proposals in the SAFE-TEA on freight and goods movement, it has often been an orphan in public policy. I know I didn't pay much attention to it when I was commissioner at the state level in a state agency.

I think our proposals are still relatively modest, but I think we try to get people to focus on the issue across modes: rail, truck, the interfaces, the intermodal connections between a ship coming into a port and a rail system or trucking so it reaches its eventual destination. And we're going to have some more proposals dealing with that, including working closely with the private freight rail system as part of that.

Now, let's come back to passenger rail. As I mentioned earlier, Amtrak actually has been operating without authority since September 30 of last year just on the basis of an appropriation. That has not been unusual in the, whatever, 35 years or so that Amtrak's been in existence. It oftentimes has gone from year to year.

It is an extraordinary situation actually. It amazes me and others that people seem so locked in, so rigid in their views about how on the one hand, their federal government should play no role in intercity passenger rail, or even some people saying -- and this is the case -- passenger rail carries less than one percent of intercity traffic. And so there's some people that say, what do we need a passenger rail system for, and certainly the federal government shouldn't be playing any role in it.

On the other hand, there's those people who would argue that a system that was created absent-mindedly -- I wouldn't even call it a system -- a corporation that was created absent-mindedly in the early 1970s when Congress and the administration was trying to deal with saving the private freight rail system, they relieved them of the burden of passenger rail and they took a collection of cats and dogs, of odds and ends, and put them into something called Amtrak and called it a company -- or called it a system.

And there are a lot of people who take the position today that it's -- we have a system; Amtrak is the same as intercity passenger rail -- and that all it needs is a lot more money; it doesn't need any reform, it's a perfect system, everything is great except it needs a lot more money. That is not the view of this administration.

This administration is, right up to the President, is absolutely committed to intercity passenger rail as a critical element, as an essential element of a multi-modal national transportation system. But we also think that what it is needs to be reformed, because we have segments, we have quarters in which intercity passenger rail plays a very important role. We're in one here. The northeast corridor, it carries a very substantial portion of the -- half or more of the combined air and rail passenger movements between Boston and Washington are by intercity passenger rail.

There are other places like California, particularly Southern California, the Pacific Northwest, where intercity passenger rail is an important and increasingly important mode. There are places where it should be, whether it's extending the northeast corridor south to Virginia and North Carolina to Atlanta, Florida, some parts of Texas, and obviously, the Midwest got a hub down in Chicago.

Intercity passenger rail has really proven itself in those places. I think it is much more questionable, to be candid with you, that there is an essential national interest in assuring that there is intercity passenger rail between Orlando and Los Angeles, that there is a train that goes, you know, three times a week between Orlando and Los Angeles in which every passenger is subsidized by the United States taxpayers at the rate of $400-$450 a trip. So I think we need to parse this out and what do we really mean? And the administration has just made a major proposal for reforming, thinking differently about intercity passenger rail, with a real focus on strong regional systems where intercity passenger rail is competitive, has a market niche, plays an important role.

And those are essentially between city pairs 300, 400, 500 miles apart, in which opening it up to greater competition; improved efficiency, with a role for the federal government as a grantor, as it is in other parts of the transportation system, whether it's highways or transit or airports; making grants to, in this case, individual states or groups of states. It's really creating partnerships.

It's a different concept. And I must say, I have been disappointed in the reaction. Not that our proposal is perfect; it isn't by any means. These are very difficult, very complicated issues. But people are throwing up all sorts of strawmen. There are people who are saying, well, this is the British rail model. It has nothing to do with the model of British rail, the so-called privatization of British rail.

The people have said this is a privatization scheme. It is not a privatization scheme. It's permissive. It allows greater competition once we go through a transition basis. And other people have talked about huge job losses, not just on the rail system itself, but huge job losses if the President's proposal were adopted, which is totally fictitious.

I would hope and what we hoped would and will come out of this discussion is dealing with fundamentals. Let's talk about what intercity passenger rail should mean. We don't have a monopoly on the right answers, but let's go back to the basic fundamentals and ask the right questions and try to, for the first time, design a system.

Because Amtrak was not a system. We do not have a national rail system in this country, and we need to develop, first of all, a consensus about what that should be.

Mr. Abel: What's the next step in this dialogue to be able to come to a policy decision on a rail system?

Mr. Frankel: Well, we're continuing to talk to stakeholders, whether it's the private freight railroads -- and incidentally, outside of the northeast corridor, as you know, Amtrak travels on private freight lines almost entirely, and has a right of access to those private freight rail lines. So the private freight carriers have to, as the owners of the underlying right of way, have to be parts of this. Labor has to be parts of it. The users obviously have to be parts of it; states and local officials. And we're reaching out to all of them and talking to all of them and trying to get them to engage us.

We need to be engaged, and hopefully Congress will play that role. I think we have a high degree of confidence that the relevant jurisdictional committees in the Senate, the Congress Committee under Senator McCain's leadership, will engage in this issue seriously; similarly, on the House side, the House Transportation Infrastructure Committee.

And those will be forums in which we deal with fundamentals. And we hope people of goodwill will kind of get out of their corners, stop being so rigid and talk about this and talk about some of the fundamental questions.

Mr. Abel: Let's switch gears for a moment and talk a little bit about the future of the Department. What's on the horizon for the Department over the next couple of years and what is the role of policy in helping to be able to develop what that future looks like for the Department?

Mr. Frankel: I think in the next couple of years, outside of seeking enactment of these major pieces of legislation, the AIR-21 Reauthorization, now called Vision 100, I believe -- which actually has a conference report pending in both houses -- so that could well be enacted this year. Getting enactment of that; getting enactment of SAFE-TEA, or whatever the bill is going to be called by Congress, and dealing with intercity passenger rail, those clearly are the highest priority items.

But overall, this emphasis on highway safety and safety in our transportation system, general aviation safety, that remains a very, very great challenge; it will permeate not only what this legislation will look like and our role in that, but also programmatic reforms. The balance -- and we haven't talked about it very much here because our primary responsibilities have shifted to the Department of Homeland Security, but we need to be able to have a safe system, a secure system, but one that is efficient and productive.

And there are some people who would say we can't have security without a system that, you know, is going to be slower. Well, we can't accept that. You know, the safest and most secure system is one that doesn't move anybody. You just shut down a port; that will make it real safe and secure. Well, we obviously can't do that, but how do we balance these things? And that requires a lot of thinking on our part, a lot of close work and cooperation with the Transportation Security Administration and other parts now contained within the Department of Homeland Security. But even within that; getting seatbelt use up, reducing drunk driving, driving under the influence, that will remain a very high priority.

This emphasis on freight and goods movement, we'll have a lot more proposals to make. Improving technologies, the application of technologies, whether they're information technologies through the so-called ITS program, Intelligent Transportation Systems, making them serve the users of this system, being more directed to that and not just toys for producers, but things that really make a difference in how we more effectively and efficiently use our system, as well as the application technologies to speed up construction and make our systems safer while construction is going on, because, you know, we have an aging system.

We have a great transportation system; I think we shouldn't overlook that. But it's also an aging system. There are parts of the interstate highway system that are, you know, 50 years old, just about 50 years old, and are undergoing rebuild. And how do we do that so we don't have projects that go on for five years? That's going to be a major both programmatic and policy challenge. And in all cases, the Department of Transportation, the United States Department of Transportation, must be a leader. It may not be the owner/operator of these facilities, but we must be the leader in terms of developing and pushing policies that make the entire system connected, effective, connected across regions, across modes, but safe and secure and efficient.

Mr. Lawrence: You've had a long career of serving the public in different sectors. What advice would you give to someone interested in a career in public service?

Mr. Frankel: I don't think they should be discouraged. I know that people are discouraged in many ways from the public sector today for a lot of reasons: you know, the cost -- sometimes if it's elective office, the direct cost of getting yourself elected. But, you know, the sacrifices that you must make, financial sacrifices that one must make to serve even for a short period of time; the examination by the press, and not being held to objective standards. All these things are discouraging elements. But it is tremendously exciting, invigorating, your ability to really affect outcomes to -- you know, all of us, I think, have the desire to have looked back on our lives and think that we've made a difference, that we have changed something for the better. And there is no greater opportunity to do that than in the public sector, however brief.

I'm also an advocate, because it's in my own life, to be able to have the capacity to move back and forth between the private and the public sector, because I think that makes you more valuable in each of those sectors, having had the experience in the other. So I would urge people to look for opportunities for service, whether it's service, to take two years or five years or six years out to do it, or shorter term or on a voluntary basis. I think everyone will find it an invigorating, satisfying, fulfilling, if sometimes frustrating, experience and one in which they can make a difference.

Mr. Lawrence: Well, Emil, we're out of time this morning. Dave and I want to thank you for squeezing us into your busy schedule.

Mr. Frankel: Thank you very much.

Mr. Lawrence: This has been The Business of Government Hour, featuring conversation with Emil Frankel, Assistant Secretary for Transportation Policy at the U.S. Department of Transportation.

Be sure and visit us on the Web at businessofgovernment.org. There, you can learn more about our programs and get a transcript of today's fascinating conversation. Once again, that's businessofgovernment.org.

This is Paul Lawrence. Thank you for listening.

Emil Frankel interview
10/18/2003
Ms. Frankel is the Assistant Secretary for Transportation Policy for the United States Department of Transportation

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