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Tuesday, December 13, 2005

Our Decaying Infrastructure

Given that one of the authors is Warren Rudman, a Republican, this call for increased spending on infrastructure is surprising:

It's Time to Rebuild America A Plan for Spending More -- and Wisely -- on Our Decaying Infrastructure, by Felix G. Rohatyn and Warren Rudman, Washington Post: Two recent, very different events ... serve as startling examples of our unwillingness to support needed public investment... On the Gulf Coast, the failure to invest adequately in the levees of New Orleans and to prepare for or manage the resulting disaster was obvious to the world. On the Pacific Coast, in the state of Washington... [t]he region's infrastructure had been outstripped by growth. But the new governor, Christine Gregoire, had the courage to impose a phased-in motor fuels tax to repair the state's dilapidated and congested roads and bridges. Her opposition tried to repeal the legislation with a ballot initiative, but thanks in part to the support of the state's most powerful business leaders, voters stood by her and supported the tax...

In many parts of the country, the population has outgrown its infrastructure. The resulting decline in quality of life is having a direct effect on the region's corporations as well as on its residents. Private investment has led U.S. economic growth for two centuries, but it could not have done so without a series of complementary public investments in canals, railroads, roads, the airspace system, water projects, public transportation, public schools and the like, which improve business productivity and our standard of living while generating significant increases in private-sector employment. But these investments have been badly neglected in recent years. ...

Americans may not want "big government," but they want as much government as is necessary to be safe and secure. Today state and local governments spend at least three times as much on infrastructure as the federal government does. In the 1960s the shares for both were even. Even so, increases in state spending have not been enough to check the decline in many of our public assets. ... There will no doubt be opposition to solving this problem. Advocates of "small government" will characteristically oppose government's performing its valid, historical role. ... The nation's infrastructure [is in] crisis ... A federal role is needed to fix it, but that role must be reconceived, redrawn and refinanced. Success will improve our quality of life, our standard of living and our competitiveness. That will require government big enough and smart enough to be effective...

Remember who Warren Rudman is? He's Mr. Deficit Reduction:

The Gramm-Hollings Deficit Reduction Act, passed in 1985 by the United States Senate: Senators Ernest Hollings ..., Warren Rudman ... and Phil Gramm ... were the chief sponsors. The Act was aimed at cutting the budget deficit, at the time the largest in history. Its official name was the Balanced Budget and Emergency Deficit Control Act of 1985. It required Congress to compensate tax cuts or spending with other revenue, and also provided for automatic spending cuts if Congress and the President failed to do so. This provision was found unconstitutional ... and a reworked version of the bill passed; however, it failed to prevent large budget deficits.

I agree with the call for more spending on infrastructure, it's needed. But, while there is a proposal in the article to provide federal financing, how the new infrastructure spending would be paid for is not addressed directly. Politics could easily turn this need into yet another excuse to cut taxes and social programs.

    Posted by on Tuesday, December 13, 2005 at 12:24 AM in Budget Deficit, Economics, Policy, Taxes | Permalink  TrackBack (1)  Comments (6)


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