Looking at our transportation infrastructure from the bottom up, I see a stalled overpass project in Summit NJ. The century old Morris Avenue Bridge was deteriorating so the state decided to replace it. Work began and then stopped because the funds ran out. Months of detoured traffic continue.
I don’t know whether federal funds could ever trickle down to the Morris Avenue Bridge from new federal transportation infrastructure funding. But we can be sure that the next step for Congress will be much more difficult than it sounds.
Where We Disagree
Funding
To pay for infrastructure projects, Congress will have to decide whether to cut spending elsewhere or borrow money. In 2015, when they were slow to agree on the funding for FAST (Fixing America’s Surface Transportation Act), part of the solution was Federal Reserve dividend money, strategic oil reserve sales and whatever they could raise from tax scofflaws. Not an ideal way to raise $305 billion.
Short or Long Term
We also will have to choose between short term job growth and long term economic growth. As economist Tyler Cowen points out at Bloomberg, all infrastructure is not equally beneficial. Sometimes a short term project will enable a politician to say she created hundreds of jobs. But poorly executed, the benefit is fleeting. Instead she would need to take credit for an investment that would become fully productive in two decades:
Repair or Replace
We also have not decided whether the focus should be repair or replace. Again here, the politician’s incentive could be counterproductive. The razzle-dazzle of a new high speed train or bridge could outshine the need for basic maintenance.
Allocation
And still it gets more complicated. As you can see from this Pew infographic, the Congress has to agree on the state and local recipients:
Our Bottom Line: Transportation Infrastructure
Moving from 18th century roads to 19th century canals and railroads to a 20th century interstate highway system, the growth of our transportation infrastructure has played a crucial role in our economic development.
What should be next?
My sources and more: Combined, this article from fivethirtyeight, this research from the Congress, and this analysis from Bloomberg convey the reality of our infrastructure plight. Please note that Our Bottom Line was previously published in a past econlife post.
