Shortfalls in Infrastructure Spending
Every few years the American Society of Civil Engineers puts out a widely distributed report card for our national infrastructure. In 2013 the overall grade was a D+. There are reasons to take the grim picture presented by the report card with a grain of salt: The group has an interest in making the country’s infrastructure situation look as bad as possible, so that more civil engineers are hired to fix it. But the report card provides one of the most comprehensive snapshots of where we are, and are not, spending money, and where the needs are likely to be the greatest in the coming years.
Quality of U.S. Infrastructure
To get a sense of how the quality of America’s infrastructure has changed over time — and how it compares with infrastructure in other countries — one of the best tools available is the World Economic Forum’s survey of global executives. It is worth remembering that these figures come from a survey of the most powerful members of society, not the poor, who might experience the shortcomings of our infrastructure more intimately. But the figures suggest that America’s infrastructure still stands up quite well to international comparison and is not in precipitous decline.
Does Infrastructure
Spending Lead To Growth?
Economists have provided vastly different estimates on how much infrastructure spending can be relied on to generate long-term economic growth. All sides, though, agree that the outcome depends in large part on the particular timing and location of the spending. In an earlier era, for instance, new roads vastly expanded the opportunities available to American businesses. Nowadays, spending on highways appears to come with significantly lower returns.
Smart Ways to Spend
For politicians, it is generally more attractive to spend money on new projects, with their ribbon cuttings and news coverage, than on the boring maintenance of existing roads and public works. Infrastructure experts complain that this has led to a persistent underinvestment in maintenance. New data, though, suggests that politicians and bureaucrats have become aware of the problem and are focusing more on important but unrewarding maintenance work.
How to Fund It
The federal gas tax was set at 18.4 cents a gallon in 1993, and it has not been changed since. The fixed rate of the tax, along with the increasing fuel efficiency of American cars, has meant that gas tax revenues have not kept up with inflation and the costs of maintaining our roads. The federal government has had to chip in money from its general fund to make up for the shortfalls, but Congress has been reluctant to continue doing this. States and local municipalities are increasingly looking to tolls and user fees to pay for new roads and repairs.
Authors: Nathaniel Popper and Guilbert Gate
Source: http://www.nytimes.com/interactive/2016/11/15/business/dealbook/dealbook-infrastructure.html?rref=collection%2Ftimestopic%2FInfrastructure%20(Public%20Works)
