This article first appeared on the Strong Towns website, on July 20, 2020.
For what it’s worth, the US House of Representatives has passed the (Act Like You) INVEST in America Act — a trillion dollar spending bill to fund highways, highway safety programs, transit, and “other purposes”.
My reaction? Yawn…
To use the framing of Chris Arnade, infrastructure spending is the ultimate “front row” endeavor. Economists love it because the 2010 rewrite of their 1980s textbooks, which were based on 1960s economic modeling, shows that all kinds of goodness ensues when we spend money on asphalt, concrete, and steel.
Politicians love it because who (besides me) doesn’t want a stretch of highway named after them?
Seriously, infrastructure spending gives every elected leader the opportunity to pretend they are making good on their promise to create growth, jobs, and prosperity. Invest in infrastructure — it’s really that easy. And by “invest” let’s be clear what they mean: Congress is merely directing where existing gas tax dollars are going and then just borrowing whatever else they decide to spend.
Yes, it’s really that easy.
Want a drinking game? Listen to any politician, economist or public policy talking head who is being critical of current policy in almost any realm. Drink when you hear the constant refrain of: “Invest in infrastructure…. Fix our bridges… Rebuild our airports… Yada, yada, yada…”
It’s Pavlovian at this point. Infrastructure has not been a good long-term, prosperity-building investment for America for decades. We built all the infrastructure already, and then some. We just didn’t bother to make it pay any kind of financial return. We confused building infrastructure for making use of infrastructure.
So our cities are all spread out, our jobs are all spread out, our families and schools and shopping centers are all spread out, which — for those not paying attention — is really frigging expensive to sustain decade after decade. Our federal infrastructure programs are great for building and expanding, but maintenance is a local issue. So is making productive use of those investments. Maintenance and productivity are hard — really hard — so why not just use all these federal dollars to do another project and grow our way out of this mess?
While the front row envisions us all riding the Acela corridor, sipping wine in biodegradable cups while trading stocks through the wifi, grateful for the good jobs and great living provided by federal infrastructure spending, the back row is left standing next to the six-lane half-street-half-road under a broken bus shelter waiting for a COVID-ridden box to transport them to their essential job.
Infrastructure advocates use the back row in the marketing brochure. They might even throw them a scrap now and then, but I’ve never seen anything to remotely suggest that funding infrastructure out of Washington DC and Wall Street is going to address the nuanced, fine-grained needs of American communities, especially those neighborhoods that are struggling.
I’m told that it’s very unlikely that what passed the House will ever become law, but I’m not a political insider able to predict such things. What I do know is that we’re going to be told this is a trillion dollars of infrastructure spending.
No, we’re going to be told that this is A TRILLION DOLLARS in infrastructure spending (so, little people, stop whining about trillion dollar bailouts for corporations and stuff because you’re getting yours already).
Something to understand about the (Act Like You) INVEST in America Act: A trillion dollars is a lot of money, but we were going to spend most of that anyway on transportation programs set up decades ago. In 2019, the Federal Highway Trust Fund collected $43.6 billion and spent $56.1 billion. The INVEST Act would increase that spending to $82.2 billion per year over 5 years. There is no proposed tax increase or other new source of revenue (although I realize that doesn’t matter anymore to most people.)
Basically, decades ago, Congress put a tax in place that will give us $43.6 billion a year today for transportation. You know, like an investment. In addition to that money, the House is now proposing to borrow/print/pretend another $38.6 billion per year into the fund. That’s merely spending, not investing, but kudos for audacity.
Under the Act, the Federal-aid highway program is going to receive $319 billion over five years. That program currently gets $45 billion per year, or $225 billion over the five years. So, the House is proposing to conjure $18.8 billion each year from the digital ether to add to roughly three times that we’ve already committed to spend.
In summary, if you like your current federal transportation spending approach, you can count on a little more of the same.
For those of you keeping score at home and hoping that a federal windfall is going to fix your cul-de-sac or favorite frontage road, you should know that there is a huge backlog of federally-directed projects this money is wired for. Even if states were free to spend it as they wished, it would only put a dent in what is a massive backlog of state-level projects.
In my home state of Minnesota, according to the American Society of Civil Engineers, we have a $109 million annual shortfall in bridge funding. We have a $885 million roadway funding gap. That is a total shortfall of $994 million per year, just to maintain the state’s current auto-oriented systems, which doesn’t include transit, navigable waterways, or airports.
Based on a formula that would give Minnesota roughly 1.8% of the expanded federal appropriation (an historic level, also consistent with our congressional representation), Minnesota will get an additional $338 million per year from the (Act Like You) INVEST in America Act. The state needs $994 million per year to keep up. Optimistically, if this legislation passes, they get $338 million per year. That is in a year when the state’s budget is imploding and the state’s gas tax revenue along with it. That’s a whole lot of highways and bridges the federal government helped us build that are never going to be fixed.
There are those who will argue that this is the best we can do, that partisanship and gridlock are so omnipresent, that reform of these programs is so difficult, that entrenched interests are so influential, that what is so desperately needed is for [insert preferred political party] to win an overwhelming majority of representation so they can bravely put forth an agenda to fix this…
The problem isn’t a ‘lack of consensus’. It’s not a ‘lack of vision’. The problem is consensus around a failed vision of how to achieve American prosperity.
We built the interstates. It’s done. And there is no good reason for the federal government to be pretending to be a player in funding the sidewalk in front of my local school or the bike trail to the local park as a front for selling me more highways and interchanges. It’s way past time to end the Federal Highway Trust Fund, the Federal-aid highway program, and the myriad of other programs designed decades ago to build new transportation infrastructure across this continent. At most, give the states maintenance money so we can sustain the national system, but that’s it.
On a final note: I’ve been an advocate for providing assistance to cities, places where leadership is not only more in touch with what is going on but where systems and bureaucracies are better positioned to respond to the urgent needs of people. If we’re going to spend a trillion dollars and we’re going to do it under the guise of helping people, we should just give the money to cities. There is nothing good that will come from insisting that our appropriations be laundered through a federal infrastructure program.
Some of you have pushed back on this notion, suggesting (in your front row way) that cities will waste the money, that without the direction and guidance of federal infrastructure programs the locals will be clueless, that your favorite program will be underfunded if it has to compete with the backward priorities of your community’s leaders…
My response: Go take a long walk through the poorest neighborhood in your city. If you can convince the people you meet there that their lives will be improved more by a federal infrastructure bill than by direct assistance to their local community, I’ll change my mind.
If you can’t, you might want to consider the concept of elite projection and how many more trillions we want to spend pursuing it.