A bipartisan proposal for more government spending
Now here’s a pair of strange bedfellows: Robert Frank and PJ O’Rourke. They have a bipartisan op-ed in USA Today making the obvious and compelling case for infrastructure investment. Not grand schemes like new high-speed rail lines, but just basic maintenance on which the country has fallen massively behind:
The American Society of Civil Engineershas identified $2.2 trillion worth of repairs needed on bridges, roads, dams, schools and water and sewage systems. And that’s just overdue maintenance, never mind addition or replacement.
Be it stimulus to the good, or deficit to the ill, the case for undertaking these projects immediately is compelling. Postponement is dangerous and expensive. Falling bridges, crumbling roads, bursting dams, moldy schools, contaminated water and leaking sewage are on no one’s agenda for cutting government costs or increasing government benefits.
And to delay infrastructure expenditure is to inflate it. For example, take a badly worn stretch of Interstate 80 in Nevada. The state’s Department of Transportation says fixing it today would cost $6 million, but waiting two years would cause the roadbed to be so degraded by traffic and weather that the price would rise fivefold, to $30 million.
Here’s my question: how did we miss this the first time round?
Here is our proposal: Have Congress create a 12-person bipartisan jury of eminent — or even half-bright — citizens. Give this panel authority to decide which of the American Society of Civil Engineers’ projects should not be begun right away. Greenlight all the rest, and with luck most will get done before the Chinese decide they’re tired of buying our 10-year T-bills at 1.7%. In contrast to the desperately overdue maintenance projects that our proposed committee would identify, the stimulus bill passed in 2009 actually didn’t have all that much infrastructure in it, and a lot of what it did have was new pork projects that were far from shovel-ready.
I have to admit that by now I expected to be able to see the real-world effects of the stimulus spending which began in 2009. But America’s infrastructure is just as crumbling as it’s always been, and the National Infrastructure Bank that I expected to see stood up as part of the 2009 stimulus never came close to being created.
We’re living in a world where the NYT writes long articles about how BNDES, the Brazilian national development bank, is so ambitious and powerful — and overspilling Brazil’s borders — that it’s causing demonstrations in Bolivia. But meanwhile, the USA seems to be incapable of corralling funding for urgently-needed domestic repairs, record-low interest rates notwithstanding.
This is a clear market failure, but one driven by the fact that the costs of infrastructure spending fall on the government, while the benefits accrue to private businesses and individuals. Since the government represents private businesses and individuals, such a set-up makes perfect sense in the rest of the world — we all group together to work on projects which benefit everybody. And America used to be great at this: the interstate highway system, the Tennessee Valley Authority, the Hoover Dam.
Now, however, there’s this bipartisan idea that government spending is a Bad Thing which needs to be cut back. Frank and O’Rourke are a rare example of bipartisan consensus in the other direction. I hope we see more of it. But I’m not holding my breath.