July 28th, 2011
Inspired by Neglecting transportation has high price, report says (Washington Post 7/28/11) and the American Society of Civil Engineers report which that article refers to. (Update: Watch the Hardball video below for Chris Matthews’ excellent proposal for how to push an infrastructure jobs bill through the political process.)
“As the American people, facing near double-digit unemployment, mark Labor Day by asking, where are the jobs, the White House has chosen to double-down on more of the same failed ‘stimulus’ spending.” – House Speaker John Boehner, speaking in opposition to the creation of an Infrastructure Bank
It’s hard to know the right thing to do sometimes,
But fortunately this is not one of those times.
Borrowing rates are at an all-time low.
(They’d have to be zero, any lower to go.)
Construction material prices are at rock-bottom.
(There’s never been a better time to have bought ‘em.)
Unemployment is high, especially in construction,
A sector that’s seen a 28% workforce reduction.
Economic growth and jobs have never been more essential,
And with infrastructure spending, the impact is exponential:
Not only do you get the economic impact and jobs of what you spend,
But those roads and bridges go on to create economic benefits without end.
But most importantly, the bill for years of neglect has come due.
Are we going to keep putting off that bill too?
The cost of doing that are clear:
Decaying roads and bridges cost the country $129 billion per year.
Fixing our crumbling infrastructure is a no-brainer,
And not just more “failed stimulus spending,” Speaker Boehner.
If our infrastructure keeps deteriorating, how can our economy do well?
Not fixing our crumbling infrastructure is the highway to economic hell.
Deferred infrastructure maintenance is a debt, and the economic damages it does is the interest.
Decaying roads, bridges, and other transportation infrastructure is costing the country $129 billion per year in damage to vehicles, increased operating costs, and delays. Inadequate infrastructure investment will destroy 870 thousand jobs, reduce salaries for those who have jobs, and kill $3.1 trillion in economic growth by 2020.
Let me emphasize that the 870 thousand jobs is not even including the jobs that will be created by making necessary infrastructure investments, that’s just the jobs that the economy will lose if we don’t. So the choice is between 21 million jobs created by crucial infrastructure investments, or 870 thousand of jobs lost due to the economic damage caused by not making those investments.
Averting that loss will require investment of $1.7 trillion during the remainder of this decade. The funding gap for that spending is $94 billion per year, or $752 billion for the remaining 8 years. That’s more than a 4:1 pay-back. But if we don’t spend that money, not only do we lose the $3.1 trillion in economic growth: at the end of the decade, the repairs will still be there and need to be made, but at a much higher cost, since (1) interest and construction costs, now at all-time lows, will be higher, and (2) our roads and bridges will have deteriorated further in the meantime. It’s like when you put off patching your roof, and then have to replace the whole roof as a result… and then find out that roof repair costs have doubled in the mean time.
It seems like a no-brainer, doesn’t it?
Here’s The Rachel Maddow Show’s 7/28/11 “Let’s Get Ready to Crumble” report on the crumbling state of U.S. infrastructure (kudos on the title).
Update 8/05/11: Here’s Chris Matthews ’s prescription for an American jobs program, and how to get it passed.