IF THE FATE of US infrastructure advancement, as well as jobs growth and the country’s economic competitiveness, rested solely in the hands of Congress, the nation might well be in a heap of trouble. Fortunately, the private sector boasts ready, willing and able investors who are helping to assume responsibility for the US’ infrastructure needs.
Moreover, individual states are taking it upon themselves to formulate solutions to the infrastructure defi cit plaguing the nation, while redefi ning public-private partnerships (PPPs) in the meantime. “There is a preoccupation with Washington D.C. But so much is happening on the state and metropolitan level,” says Robert Puentes, a senior fellow in the Metropolitan Policy Program at The Brookings Institution, a non-profi t public policy group. “Civic leaders and local governments are trying to think differently about
how they invest in infrastructure to advance the economy. The conversation is happening outside of the [Washington D.C] Beltway.”
These discussions could provide a remedy to the infrastructure gap because they tend to be less partisan in nature. Puentes points out that bridges are neither Republican nor Democratic bridges and that infrastructure development should transcend political parties. “The fact that this has been held up with partisan politics is an indication of how bad things have gotten in Washington,” he suggests.
On cue, the playing fi eld for infrastructure legislation appears to be shifting. “The pyramid structure originating with the federal government is broken and over. We won’t see uniform approaches
much longer because they are very expensive and complex. Hopefully, we will be seeing more of a permissive public sector that is not just inking deals but working collaboratively to protect the public
interest and maximise the private side,” says Puentes.
Nonetheless, federal government continues to debate ways to reduce debt, cut spending and create more revenue streams, all the while leaving overcrowded highways and crumbling bridges on
hold. Infrastructure spending has become the darling of the jobs bills being presented by both Democrats and Republicans, but progress has been slow. For sure, trillions of dollars in investment
are needed in the coming years just to keep the country’s roads, railways and other infrastructure landmarks adequate. The price tag for doing nothing, however, could be much higher.
“Their [the US government’s] focus on short-run defi cit reduction is completely absurd,” says Robert Frank, professor of economics at Cornell University. “The super committee will say that, just as
a family or business can’t spend beyond its means, neither can the government. That’s true if you’re talking about the long run. But in the short run, it’s complete nonsense. If a family or business faces
a good investment opportunity, often the only way to seize it is to borrow money to pay for it. That doesn’t mean they’re being imprudent. If the returns are good you are preparing the way for a better
future for yourself, not worse.”
Frank points to a patch of US Interstate 80 that runs through the state of Nevada and is in dire need of $6 million in repairs. He cites estimates that delaying the project for even two years would infl
ate the expense to $30 million. “There is just no argument against doing projects like that right away, no matter where the money comes from. No matter what other proposals are out there, these projects need to be done.”
Frank is less concerned about the government’s decision to open the fl oodgates to private capital than he is about their ability to come up with a working solution. He is not betting in favour of Congress. “Am I optimistic that they will do anything? No.”