Infrastructure in the Real World

September 11th, 2011 at 9:27 pm

One critique you’re beginning to hear about the infrastructure ideas in the President’s jobs proposal is that the Recovery Act’s infrastructure programs were some kind of bust, of never got started, or whatever.

Demonstrably untrue.  There’s no question that they did not get up-and-running as quickly as other parts of the program, but here’s a graph of the cumulative spendout on public investment (which includes infrastructure along with other investments like clean energy and health IT).  And below that, a more specific look at work underway by day 200 on 192 airports and over 2,200 highway projects across the country.

I’m sure you’ll hear claims to the contrary in coming days as we debate the infrastructure initiatives in the American Jobs Act, but the fact is that these projects were solidly in the economy by last summer.  The problem is we needed more of them this summer, and we’ll need more next summer as well.

Sources: first figure, CEA; second figure, see link above.

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7 comments in reply to "Infrastructure in the Real World"

  1. Sister Artemis says:

    Thanks for pointing this one out, Mr. Bernstein. I think of it often – largely because I am driving on several much-improved highways because of the recovery funds. Money much needed, and well spent. I’d love to see more of the same. Never met a pothole that improved with time…


  2. Dave says:

    I notice that spending on infrastructure in the first graph was always less than we spent in Afghanistan in the same quarter (assuming about $10 billion per month in Afghanistan). Think how much finer it would be to bring our troops home and spend the money to build useful things for communities across this country. In the long run, probably a better thing for Afghanistan as well.


  3. Russ Abbott says:

    A point that is never mentioned is that no matter what the stimulative effect of infrastructure spending on the economy, a repaired bridge or a better Internet backbone is a repaired bridge or a better International backbone. (If a project wouldn’t make a positive difference it shouldn’t be supported — at least not as a claimed infrastructure improvement.)

    Our infrastructure is falling apart. It must be fixed and modernized. The deficit hawks claim to be concerned about what we are leaving to our children. Well one thing we will be leaving will be the infrastructure as we leave it. Let’s not leave to our children a country whose infrastructure is barely functional.


  4. rjs says:

    http://www.infrastructurereportcard.org/

    you’ve barely scratched the surface…

    we dont have to pay for it now; in fact, economist karl smith shows that with interest rates as low as they are now, we could eliminate all federal taxes today & borrow 30 years out, & make a profit on that borrowing if the country grows 1.1% annually or more over that 30 year stretch…by not borrowing now, when the rest of the world is paying us to borrow, and investing in infrastructure, renewable energy, job training, and our youth, we are missing a once in a lifetime opportunity..

    http://modeledbehavior.com/2011/09/09/moving-the-overton-window-why-is-the-us-government-still-collecting-taxes/


  5. janinsanfran says:

    What strikes me about that map is that so many infrastructure projects were obviously around major population concentrations — cities. That’s not too surprising; that’s where most of us live (and use infrastructure.)

    Ah — but remember, Republicans hate cities. That’s where those Other people live and where, by and large, people don’t vote for civic collapse (vote Republican.)


    • BruceMcF says:

      There is something else around cities: suburbs, including outer suburbs. Where lots of Republican voters live, and which Republicans love dearly.

      And in terms of spending per person, road projects in particular are likely to disproportionately benefit outer suburban and rural voters over inner suburban and urban voters, precisely because the rules of Federal highway fund eligibility are designed to create a cross-subsidy from urban motorists to rural and suburban motorists.


  6. ECON says:

    Excellent J. Bernstein article. To all those who wish no infrastructure spending to benefit the collective whole of the country, may I ask what you as an individual homeowner do in the event of your need to keep your home in a good, healthy and safe condition to live in?


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