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Prospectus Blog Smart Spending On Transportation Will Strengthen U.S. Economy

But The Real Challenge Is Regional Leadership
Though the details are far from settled, a federal economic stimulus package of roughly $600 billion to $800 billion has strong support from President-elect Barack Obama. Congress, including the fiscally conservative Blue Dog Democrat caucus, is bound to register concern over more borrowing. Still, something will pass and everyone will be grabbing for their share. As much as $300 billion of the stimulus could be set aside for infrastructure, primarily surface transportation.
Hammered by declining tax revenues tied to the economic downturn, plus tight credit markets and growing transportation infrastructure needs, states are feeling needy, and many are voicing great hopes for stimulus package aid.
But the stimulus money has to be spent wisely; and regions and states will have to pitch in themselves, using innovative approaches to transportation finance and funding (about which more at our conclusion, below). Whether the stimulus provides $250 billion, $300 billion, or $350 billion for infrastructure, spread across the nation, it will only go so far. Looking at surface transportation alone – not including other essential infrastructure such as utilities – many major metro regions and states have priority project needs running well into the tens of billions.
The first step, securing congressional approval of the stimulus package and ensuring a hefty share for infrastructure, is vital. California Governor Arnold Schwarzenegger (pictured at right, with friend) explains, in Newsweek:

Our infrastructure is more than just a quality-of-life issue. It is an economic issue. Americans waste billions of dollars while semi-trucks carry goods on gridlocked roads and lose millions of gallons of water in leaky old pipes. We lose time and dollars because our ports are not computerized or modern enough to meet today’s demands. Our businesses lose real dollars because our buildings are not energy efficient. This kind of waste raises the costs of everything from clothing to cars to raw carrots. It’s clear that the faster we can move people and goods, the stronger our economy is. In short, we are a dinosaur economy trying to compete in a space-age global environment.
…why do we sit bumper to bumper on the freeway for two or three hours in order to get home from work during rush hour?…why do Americans stand in long security lines at the airport, in our socks, just to sit in the terminal for hours as our flights get delayed because of overcrowded airport runways?…we still rely on trains that go the same speed as they did 100 years ago, so our shipping times and commutes are longer than other countries….
…when you think about America’s aging infrastructure, we’re going to get beat…by our competitors China, India, Europe and Brazil. Travel overseas and you see faster commuter trains, better public transportation, double-decker freeways, and more efficient ports. Meanwhile, infrastructure spending as a share of gross domestic product in the United States has dropped 25 percent over the past 20 years. So, government spending is at an all-time high, while investment in our critical infrastructure is at a historic low. Recession or no recession, our nation desperately needs to update infrastructure that lags behind that of even some developing countries. But it is also true that a recession is the perfect time to put money into long-term investments like massive public-works projects because it creates jobs while pumping up our economy.

Tell it, Guvernator. But how can Congress ensure that the stimulus money for infrastructure – and other purposes – is spent wisely? Some useful guidelines are offered by a national group called America 2050, which tracks land use, climate change, demography, trade and infrastructure, with a focus on emerging U.S. mega-regions. The organization is funded by the Rockefeller Foundation, the Ford Foundation, the William Penn Foundation, and others. Civic, business, environmental and transportation leaders convened by America 2050 say:

…it cannot be spending as usual. A new approach is needed that establishes a new level of accountability, transparency, and economic and environmental performance for how this country invests in infrastructure projects.

They urge that the President-elect and Congress ensure any infrastructure stimulus package accent a triaged, phased, green approach emphasizing job training and bang-for-buck.
All well and good. States should adopt similar guidelines. Washington D.C. may even figure out some new ways to boost surface transportation spending after the stimulus package is passed, such as this autumn when the surface transportation spending bill has to be re-authorized. Yet in the end states and regions will bear the lion’s share of the burden in coming decades for funding surface transportation systems and boosting alternatives to solo driving. That means they will need to move more aggressively on:

  • regionwide electronic, time-variable tolling;
  • laying the groundwork for taxing vehicle miles travelled, with off-peak discounts;
  • investment by public employee and trade union pension funds, and private infrastructure funds in projects which will yield a steady stream of revenues;
  • “alliance contracting” with performance incentives for teams which design, build, operate and maintain surface transportation facilities – so project delivery schedules can be compressed, quality assured, and costs controlled;
  • developing better incentives and capabilities for tele-work and ridesharing;
  • better marrying scheduled public transit with para-transit provided by public and private operators.
  • In metro regions up and down the West Coast Corridor including Puget Sound these future-facing approaches are vital to regional mobility and accessibility and will require an unprecedented degree of cooperation between city and suburban mayors, state and federal legislators, community, labor, environmental and business interests.
    That in turn will necessitate a resurgence of the old-fashioned kind of leadership, one which is less concerned with getting re-elected and pleasing everybody than with getting done what needs to get done.