« "Were the Bush Tax Cuts Worse for Progressivity or for Revenues?" | Main | "Negative Real Interest Rates" »

Thursday, November 03, 2011

"The Case for Rebuilding our Transportation Infrastructure"

Infrastructure needs are high, costs are unusually low, and people need jobs. In addition infrastructure spending, which enhances future economic growth, can be viewed as a supply-side policy.

If our financial infrastructure was crumbling we'd do something about it, so why not do the same for our physical infrastructure, especially since the benefit to cost ratio is unusually high? I suppose we all know the answer, but it's still worth making members of Congress show their votes:

Creating Jobs and Boosting the Economy: The Case for Rebuilding our Transportation Infrastructure, by Aaron Klein, Treasury Notes: Today, the Senate begins its consideration of the Rebuild America Jobs Act, which would put hundreds of thousands of construction workers back on the job and modernize America’s crumbling infrastructure. The President proposed this measure to Congress as part of the American Jobs Act as a way to create jobs and improve the Nation’s long-term economic competitiveness by allowing goods and services to more efficiently reach domestic and global markets. The White House also released a report today that provides examples of recent infrastructure projects which have produced significant economic benefits.
Our economy is as interconnected as our infrastructure, and well-targeted infrastructure investments create immediate and long-term economic benefits to both local communities and those further away. ... As Secretary Geithner said when he visited the UPS Worldport Facility in Louisville, Kentucky recently, “If you do a better job of repairing roads and bridges, highways, airports, railways, it makes companies more competitive. It lowers their costs. It’s like a tax cut.”  Simply put, wise investments in infrastructure save companies and consumers both time and money.
In addition to laying the foundation for stronger economic growth, we must also work to address a crucial problem facing our economy today - unemployment. Investments in infrastructure today will put Americans back to work. And with over 1 million construction workers currently unemployed, now is the right time to invest in infrastructure. Eighty percent of jobs created by investing in infrastructure will likely be created in three occupations - construction, manufacturing, and retail trade - which are among the hardest hit from the recession. Treasury Department analysis shows that these sectors pay middle-class wages, so employment in these sectors bolsters middle-class jobs. ...

I am a bit worried about the privatization of infrastructure in some of these proposals, but that's about how the programs are structured, not about whether they are needed.

    Posted by on Thursday, November 3, 2011 at 12:33 AM in Economics, Fiscal Policy, Politics, Unemployment | Permalink  Comments (45)


    Feed You can follow this conversation by subscribing to the comment feed for this post.