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Home Publications Blogs Beat the Press When It Comes to Infrastructure "Vast" Ain't What It Used to Be

When It Comes to Infrastructure "Vast" Ain't What It Used to Be

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Saturday, 19 July 2014 07:24

The New York Times doesn't seem to use the term "vast" the way the rest of us would. It told readers that President Obama is:

"stymied by Republican lawmakers who refuse to go along with Mr. Obama’s call for vast new spending on the nation’s infrastructure."

The proposal in question would provide $300 billion in additional spending over the next four years. This is equal to roughly 0.4 percent of GDP over this period and less than 1.8 of projected federal spending.

 

Thanks to Robert Salzberg for calling this one to my attention.

Comments (7)Add Comment
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written by Last Mover, July 19, 2014 9:48

Obviously a freudian slip by the sock puppets. They were channeling Hillary and meant to say it's "a vast right wing conspiracy" to stifle infrastructure investment.
At least 1 trillion is needed for deferred USA infrastructure maintenance
written by John Wright, July 19, 2014 9:59
Internet searching brought up a power point presentation "Ross-ColumbiaWorkshop.ppt" from a Dennis Ross, director of professional development for the American Public Works Association.

Note, one can assume this group is interested in more infrastructure investment.

The presentation has a slide detailing this for American infrastructure.

59% of roads in poor to fair condition
31% of bridges deficient or obsolete
1/3 of school buildings need repair
12% of dams are high hazard due to deterioration.

The slide lists $358 billion needed for roads, bridges and highways, $72 billion for mass transit systems, $33-60 billion for airports, $200 billion for schools, $138 billion for drinking water and $213 billion for wastewater. This totals $1014->1041 billion.

If these numbers are correct, Obama's program will not even fix 30% of the accumulated deterioriated infrastructure in the USA.

And more infrastructure will be deteriorating as Obama's $75billion/year program proceeds.

One could argue the USA should agressively pursue the $1 trillion of deferred maintenance AND add a large incremental amount to IMPROVE infrastructure.

Joseph Stiglitz estimated the true cost of the Iraq war was greater than 3 trillion and could reach 5 trillion (Bloomberg, March 1, 2008) and there was a recent estimate the USA war on drugs has cost about $1.5 trillion.

I'm certainly not alone in believing the USA could allocate its national wealth far more productively.

Infrastructure Need as Percentage of GDP
written by Robert Salzberg, July 19, 2014 10:22
Mckinsey estimated last year that U.S. infrastructure spending is about 1% of GDP less than what we need. So the "vast" spending President Obama is proposing is only about 40% of what we need.

In addition, we really should have a system of high speed rail up and down the East coast, the West coast, and East to West in the South and North parallel to our interstate system.

Modernization of our electrical grid and air traffic control systems are also long overdue.

So rather than vast, inadequate or skimpy would be a more fact based description of President Obama's proposal.

Furthermore, since President Obama knows that Republican obstructionism, deficit delusions, and blind 'No New Taxes' ideology make any significant increase in infrastructure spending highly unlikely, there's no reason President Obama should propose a vastly larger infrastructure bill.

http://www.ritholtz.com/blog/2...d-nations/
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written by Kat, July 19, 2014 10:46
Actually, I don't think Obama need be such a shrinking violet. I am not discounting the obstacles placed by the Republican party, but what is to be gained by accepting their terms of debate? Go ahead-- ask for vast infrastructure spending, fight for it, and above all call it a jobs program. He certainly is free with the word "jobs" when touting the TPP.
He owns some of this problem-- pivoting to the deficit, comparing the US budget to a household budget, and talking about the need to raise taxes in order to "fund" this spending. Honestly, do they tally up tax receipts before some firm is awarded a military contract?
My bad, typo in previous good
written by Robert Salzberg, July 19, 2014 10:57
I meant to write:

there's no reason President Obama should(n't) propose a vastly larger infrastructure bill.
Link to the nyt article cited by Robert Salzberg and Dean Baker
written by jaaaaayceeeee, July 19, 2014 4:10
...
written by urban legend, July 22, 2014 12:36
If there is a massive deficiency in our infrastructure spending -- and we can experience for ourselves that there is -- and if our economy is suffering on a long-term basis from insufficient demand for goods and services to maintain genuine full employment, why can we not connect those huge dots? We have a long-term, "secular" insufficiency of government spending to maintain its portion of aggregate demand that was spawned by the Proposition 13/"government is the problem" era. We not only need to put millions to work just to fix the gigantic flaws in our existing infrastructure, we are now decades behind other wealthy countries in the infrastructure quality and need to employ millions more to catch up. Chicago to St.Louis, 5 1/2 hours to go 284 miles, avg speed 51 mph, slower than in the 1930s; that's crap. Routine 25 minute delays on urban transit systems; that's crap. Subway stations without elevators and with escalators broken half the time; that's crap. The whole thing is crap and it's not the fault of the people who work for Amtrak or the MTA or the CTA or the other public agencies who try their damnedest managing our public infrastructure; it's the fault, 100%, of the pure evil of Republican politicians and of the failure of Democratic politicians to fight for what they claim to believe in.

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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