The Failure of American Governance in 1 Depressing Chart

Infrastructure spending has fallen about 25 percent, after inflation, the past 5 years.
Reuters

Here are three facts to consider.

First, infrastructure spending has a higher bang for the buck than just about any other kind of spending. The San Francisco Fed, for one, estimates that every $1 of highway spending raises GDP by $2. Second, even if you don't believe in multipliers, infrastructure spending is something we have to do eventually—so we'd save money if we do it when interest rates are low. Third, investors are paying us 0.43 percent after inflation to borrow for 5 years.

Now look at the chart below, via Cardiff Garcia of FT Alphaville, of inflation-adjusted infrastructure spending in the U.S. the past decade. Weeping is optional.

This is what a disastrous policy error looks like. There wasn't enough infrastructure spending in the stimulus, and there really hasn't been enough since the stimulus ended—and since austerity-obsessed Republicans took over the House. President Obama has, of course, called for modestly more infrastructure spending now, but that's been a political non-starter.

This isn't even penny-wise and pound foolish. It's just foolish.

Presented by

Matthew O'Brien

Matthew O'Brien is a former senior associate editor at The Atlantic.

How to Build a Tornado

A Canadian inventor believes his tornado machine could solve the world's energy crisis. The only problem? He has to prove it works.

Join the Discussion

After you comment, click Post. If you’re not already logged in you will be asked to log in or register with Disqus.

Please note that The Atlantic's account system is separate from our commenting system. To log in or register with The Atlantic, use the Sign In button at the top of every page.

blog comments powered by Disqus

Video

How to Build a Tornado

A Canadian inventor believes his tornado machine could solve the world's energy crisis.

Video

A New York City Minute, Frozen in Time

This short film takes you on a whirling tour of the Big Apple

Video

What Happened to the Milky Way?

Light pollution has taken away our ability to see the stars. Can we save the night sky?

Video

The Pentagon's $1.5 Trillion Mistake

The F-35 fighter jet was supposed to do everything. Instead, it can barely do anything.

More in Business

Just In