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Tuesday, March 10, 2015

'Spending on Our Crumbling Infrastructure'

David Wessel:

Spending on Our Crumbling Infrastructure: Larry Summers recently said something startling: “At this moment . . . the share of public investment in GDP, adjusting for depreciation, so that’s net share, is zero. Zero. We’re not net investing at all, nor is Western Europe”...
In other words, total federal, state, and local government investment is enough to cover only the amount of wear and tear on bridges, roads, airports, rails, and pipes. “Can that possibly make sense?” asked the former Treasury secretary, who has been campaigning for more government spending on infrastructure.
I wondered whether Mr. Summers was hyping the data to make his point. So I checked. ... Mr. Summers wasn’t exaggerating. ...
All this is happening at a time when the U.S. government can borrow money at very low interest rates... It would seem a good time for the government to borrow for long-term investments, as Mr. Summers frequently says. ...

    Posted by on Tuesday, March 10, 2015 at 01:10 PM in Economics, Fiscal Policy | Permalink  Comments (63)


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