Is Now the Time for an Infrastructure Overhaul?
And, just as importantly, is it politically feasible?
President Obama is again calling for an "overhaul" of U.S. infrastructure, this time following the publication of a report showing infrastructure spending could create jobs and help the economy. To supporters, this is a classic "kill two birds with one stone" scenario: modernize the nation's failing, outdated infrastructure while helping the economy. To opponents, however, this is throwing good money after bad; more spending we can't afford doing what the stimulus was already supposed to do.
This Is Why Voters Are Angry "Excuse me, but wasn't this what the stimulus was going to be used for?" asks Commentary's Jennifer Rubin. "We've spent under Bush and Obama a couple of trillion, and we still need to spend more because that amount didn’t cover things we absolutely need?"
- Stimulus Should Already Have Done Some of This, agrees David Dayen at progressive Firedoglake. But while "it's true that the stimulus didn't go far enough on infrastructure ... they’re onto this no-brainer policy now, and it demands support."
That report is here, and it basically repeats the obvious: infrastructure spending is a bargain right now because of low borrowing costs and low labor costs, it would generate a lot of economic activity in sectors that have a lot of excess capacity at the moment, like construction and manufacturing, and it would leave a lasting legacy that would increase productivity and growth for decades. To say nothing of the fact that repairing broken infrastructure in the event of a catastrophe would cost inordinately more than getting it done before something bad occurs.
- This Plan Could Go Further, notes The Washington Monthly's Steve Benen. Obama's current proposal has "real merit, but it's also fairly modest given what's possible and what's needed. ... Remember," he continues, "the price of raw materials is incredibly low right now. Bang for our buck, there hasn't been an opportunity like this one--stretching our infrastructure dollars very far--in a long time."
- Why the Time Is Right Andrew Samwick at Capital Gains and Games expands on this theme of "unused factors of production that can be employed on the cheap," making this the "optimal time" for such a project. "The Treasury/CEA report goes on to cite evidence of this," he notes. He also says he's "glad to hear that the definition of infrastructure was broad enough to include more than just transportation networks."
- To Sum Up: Why This Is a Great Idea The Washington Post's Ezra Klein points out that "this is one sector where the normal deficit objections simply don't apply," quoting Larry Summers on how "defer[ing] maintenance" is much like running up a deficit: "Not spending a dollar on infrastructure repairs today means we'll have to spend it tomorrow," and tomorrow, it will be more expensive. Here's Klein's summary of why this is a good project:
Lots of stimulus programs can create jobs. But infrastructure investment creates the right jobs, for the right people, doing the right things--and at the right time. Or, to say it more clearly, infrastructure investment creates middle-class jobs for workers in a sector with high unemployment and it puts them to work doing something that we actually need done at a moment when doing it is cheaper than it ever will be again.
- Of Course, It Would Have to Get Through Congress The liberal support is tempered with realism. As left-leaning Steve Benen sees it: "Congress is broken, 'spending' is somehow perceived as 'bad,' and desperately needed infrastructure investments probably won't happen because Republicans won't let it." In other words, this may not be politically feasible.