JANUARY 9, 1996
The snow's impact on national and international travel was more than just a flurry. Elizabeth Farnsworth reports on the great blizzard that has crippled the East Coast.
MS. FARNSWORTH: For some insight into the storm's effect on airline transportation and on the economy generally, we turn to economist David Wyss, research director for DRI McGraw-Hill, an economic consulting firm in Boston, and to George Marlin, director of the Port Authority of New York and New Jersey. Thank you both for being with us. George Marlin, beginning with you, what is the current status of the three airports in New York?
GEORGE MARLIN, Port Authority of NY and NJ: (New York City) Well, we had over the past 48 hours a whiteout, and I was driving along the runways of La Guardia Airport, and I can tell you Saturday night, Sunday night, Monday morning, you couldn't see two inches in front of you. We had drifts as high as 20 feet. We're normally accustomed to an average of 3,000 flights a day coming through our airports, about 215,000 people coming through. We have had over 5,000 cancellations in the last 48 hours. Today we opened the airports, JFK opened at 7 o'clock this morning. Newark and La Guardia Airports opened at 10 o'clock. We're expecting to see today about 10 to 15 percent of our normal traffic.
MS. FARNSWORTH: Mr. Marlin, what's the national and the international impact of, of this reduced traffic and of all the cancelled flights? Give us a picture of what it does to the rest of the nation and to the world.
MR. MARLIN: Well, it certainly affects both the nation and the world. There's a ripple effect. To give you an idea, this morning we realized that there were five flights sitting up in Anchorage, Alaska, that came from Asia. They expected to be in New York Sunday afternoon. We had a dozen flights sitting up in Montreal, which expected to be in New York Sunday afternoon. They came from New York originally, so what we're seeing is several hundreds of thousands of people right now aren't where they wish to be, and you have several hundred thousands of people every day who want to be somewhere else as well, so it starts building up these numbers. In addition, each carrier has their own separate problems. Late afternoon I think Washington, D.C., was not open; the airports down in D.C. yet, so you have planes frozen down there who were supposed to be several other places during the course of the past couple of days. At Newark this morning, we had to get 60 planes out that were locked in there for close to 48 hours who were supposed to be in several places over the last couple of days. In addition, the Washington shuttle to New York and Boston is not working yet, so you're having a ripple effect of all these international domestic flights that are falling further and further behind, so it means people aren't getting where they want to be. It affects business. It affects everybody's lives, so it's, it's, to pardon the pun, the snowball effect, and we're going to be unwinding in that, but it's going to take about three to four days to get back to the normal traffic coming through our airports.
MS. FARNSWORTH: David Wyss, this won't be very good for the airline industry, will it?
DAVID WYSS, Economist: (Boston) No. This is really a problem for the airline industry. They're not getting any revenue in while this is happening, and a lot of these airlines were not in great shape to begin with.
MS. FARNSWORTH: And what about the economic impact as a whole, what do you think about that?
MR. WYSS: The storm has really done a number on retailers. Retailers came out of Christmas. It was a weak Christmas. They had storms before Christmas. They've got lots of goods on the shelf, and now they've lost another weekend worth of sales. They've lost 7.8 billion dollars of sales during the storm.
MS. FARNSWORTH: How about other effects?
MR. WYSS: A lot of other industries are going to be affected too. With the shutdown we've had in the Northeast, you've lost two or three days of production in those cities. That's, that's jobs that have to be made up. The construction industry just is not operating through the mid-Atlantic into the- into New England where there's not much here anyway this time of year, but that's another batch of jobs, another batch of production that's just not there, and agriculture looks like it may be taking a hit too down in Georgia and in Florida.
MS. FARNSWORTH: Does this, does this affect the whole country, or is it pretty much just where the storm hit?
MR. WYSS: Well, it affects primarily where the storm hit. There are some ripple effects on the rest of the country. If you're producing goods, for example, that you're using as parts produced in, in the Midwest, they're not getting those parts. They can't get goods to stores or to factories in the East because the roads are still a mess. So there are some ripple effects outside of this region, but most of the impact is up here.
MS. FARNSWORTH: Added to the government shutdown, does this actually, do you think this will lead to a real slowdown in economic growth?
MR. WYSS: It's great. As soon as the Republicans let the government open, God shuts it down for a few days. I think that it does double the impact. We lost probably 1/4 percent of growth in the fourth quarter because of the government shutdown. We could lose at least as much in the first quarter because of the storms.
MS. FARNSWORTH: Mr. Wyss, let me put the skeptics' questions to you. Some analysts say that, that there won't be such Élarge losses for retailers because shoppers who couldn't get into a mall or into a store last weekend will just go and buy double what they might have bought, or you know, buy what they would have bought last weekend and this weekend this coming weekend. Do you think that's true?
MR. WYSS: Well, some of that will be true, but it looks like we're going to have another storm this weekend, so I don't know how they're going to get to the mall then either. And eventually, if you lose enough weekends, it's awfully hard to make up those lost sales.
MS. FARNSWORTH: And how about factories working overtime? Some analysts say that factories just in this sort of a case, they work overtime next month, and they make up for the lost production.
MR. WYSS: Well, they will work overtime next month, and they probably will make up most of that production by the end of the quarter, but that comes as an expense to the producers. You're going to pay overtime.
MS. FARNSWORTH: George Marlin, tell us how, how you cleared the airports. How difficult was it to clear your runways and get everything back to normal?
MR. MARLIN: Well, there's a number of factors. Keep in mind the Port Authority of New York and New Jersey. I oversee not only three airports but the George Washington Bridge and three other bridges, plus the Lincoln and Holland Tunnel, as well as a Path Subway System, and the World Trade Center. So we put out a snow emergency. We started shifts of 12 hours, a lot of people working up to 18 hours. We had people on cots at all the airports. We had 150 plows out at each of our bridges and tunnels, we have 300 tons of salt, 50 tons of sand, so we had this great army out there working through the night, but the fundamental problem became first was the whiteout, then the velocity of wind which was so strong and the airports are on the water, the second you start- were able to get the plows out, because during the whiteout it was too dangerous to put the plows out- once you got them out late yesterday afternoon, the winds were blowing the snow back. So last evening, finally, the winds died down. We had those plows out through the entire night. What happens, of course, is you got to put the snow someplace, so there is limited parking at the airports at this point in time because in addition, first priority was to clean the runways, secondly, we had to take snow and dump it somewhere and that was the parking lots, and today as we get all the runways open, we'll be centering our energies on those, on those parking lots. So there's limited parking. It will still be difficult for some people to get into the airport, so it's a series of problems. So we've put together an army to get out there and work and the Port Authority, the people of the Port Authority have done a tremendous job in the last 48 hours.
MS. FARNSWORTH: And has the resumed travel brought a whole new set of problems? One of the wire services reported that people are going to the airports now expecting to get on some flight and that they're quite full. Are you having that trouble?
MR. MARLIN: Of course. What everyone has to do is call their carriers, because as I described early, each airline has a different set of problems depending on where their planes were, where their equipment were, where their crews are during the course of the storm, so again we're several hundred thousand people behind from whence they wanted to be. That number is growing, so you just can't assume because you had a flight for Wednesday that that same flight is going to be there tomorrow, so you have to call that carrier, so these problems will take several days to unwind until we get to our normal 3,000 flights a day at the three airports.
MS. FARNSWORTH: And I know it's a bit premature to ask you about costs. You're in the midst of the crisis part of this, but can you give us- do you have any sense of what this will cost, what added operating costs you have because of the storm?
MR. MARLIN: At this point in time, I really don't have a clue. Just to give you an idea, the George Washington Bridge, we normally on a typical average Monday in January, 122,000 vehicles go through that bridge and pay a fare. Yesterday, 5,000 vehicles went through the George Washington Bridge, so not only do you have the greater cost, your revenue base is declining for a period of time. But, again, we're here to serve the people of the region. Our job is to make sure our customers get where they need to be and where they want to be. So I haven't looked at cost. I haven't got a clue. Our concern was getting our facilities open to serve the people of this region.
MS. FARNSWORTH: And David Wyss, just briefly, cities, counties, and states that were already strapped are incurring very large additional costs, aren't they?
MR. WYSS: You're probably talking about another couple of hundred million dollars in extra cleanup costs through the Northeast and into the Southeast caused by this. That's a significant hit for a lot of the cities that were in trouble on their budgets anyway, and only a few of them have insured those losses.
MS. FARNSWORTH: Okay. Well, thank you both very much for being with us.
MR. MARLIN: Thank you.
MR. WYSS: Thank you.