Saturday, August 1, 2015

Infrastructure spending, please

The DN feels quite strongly that the government needs to be spending more money in one particular area:

Infrastructure spending, please

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The DN feels quite strongly that the government needs to be spending more money in one particular area:

When it comes to repairing infrastructure, we can pay now or we can pay later.

But if we put it off, the eventual bill will be much higher, not only in lost dollars but in lost opportunities and a weaker economy overall.

That's the gist of a report by the president's Council of Economic Advisers released on Monday in conjunction with a White House meeting attended by Mayor Nutter and Gov. Rendell among other municipal and state leaders.

It was an excellent report (more about that later) but also a deeply troubling one in that it had to be made at all.

This country apparently is so crippled by myopia that we need to have a full-dress economic analysis to explain to us how safe roads, bridges and tunnels are better than ones that are dangerously unsafe. Which they are: the American Society of Civil Engineers gives the nation's infrastructure a grade of D - and dropping. We apparently are so phobic about the idea of "government spending" that we are willing to take the risk, or rather have our kids and grandkids take it, to save a few bucks today. And Republicans apparently are willing to block desperately needed improvements because it just might mean that ordinary people will get jobs, and they will lose a campaign issue.

President Obama renewed his call for an immediate $50 billion investment in transportation infrastructure, an eventual $500 billion over six years - and the creation of a National Infrastructure Investment Bank to establish a saner way to decide what gets built and where.

Predictably, the meeting was reported in true inside-the-D.C.-bubble fashion, with almost singular focus on whether the stimulus package has been a modest success or an abject failure. (After several such questions, Nutter stepped forward to observe, "It just seems that maybe you folks need to get out a little more, get out into cities, into real places where there are real people [to see those who have been put to work, as well as those who still need jobs.] Indeed.

The CEA report described not only the advantages of repairing infrastructure, but also the substantial benefits of doing it now:

-The jobs that would be created are middle- class jobs in occupations like construction (61 percent), manufacturing (12 percent) and retail (7 percent). These are areas that were among the hardest hit when the housing bubble broke and where the unemployment rate is 15 percent. Employing these workers in government infrastructure jobs would reduce competition for private-sector jobs. _ High unemployment - meaning a higher supply of labor - means it's cheaper. Interest rates are low, meaning overall financing is lower: The U.S. Department of Transportation reports that more than 2,000 additional transit, highway, bridge and airport projects were funded through the Recovery Act because of low bids or projects coming in under budget.

-Deferred maintenance is many times more expensive than keeping things in good repair. Think patching the roof rather than dealing with massive water damage. Think fixing a bridge before it collapses or repairing a levee rather than restoring a destroyed city.

What the report didn't say - but we will - is that the critical need for infrastructure investment reveals the utter bankruptcy of the conservative answer to every problem: tax cuts. No matter if they spend or save the extra money from lower tax bills, it's for sure that individual Americans aren't going to repair a bridge or expand an airport runway with it.

At least, not out here in real places where there are real people.

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Every year, city government spends slightly more than $4 billion. Where does all that money come from? More importantly, where does it go? Are we getting the most bang for our tax buck? “It's Our Money” is a joint project between Philadelphia Daily News and WHYY, funded by the William Penn Foundation, designed to answer these questions.

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