US needs to spend $200bn a year on infra

A recent report from the Building America’s Future coalition - chaired by New York City Mayor Michael Bloomberg, former Pennsylvania Governor Edward Rendell and former California Governor Arnold Schwarzenegger - argues that PPPs are 'imperative to raising necessary funds in these budget-strapped times'.

Building America’s Future, an advocacy group founded by New York City Mayor Michael Bloomberg, former Pennsylvania Governor Edward Rendell and former California Governor Arnold Schwarzenegger, has issued a report arguing that the US needs public-private partnerships (PPPs) in order to rebuild the country’s infrastructure.

“Although these partnerships are not a panacea, they are imperative to raising necessary funds in these budget-strapped times,” according to the report, entitled Falling Apart and Falling Behind.

The report argues that the US needs to create $200 billion in annual infrastructure investment over the next ten years in order to implement an infrastructure plan as “significant in scale as the plans adopted by our competitor nations”. The $200 billion a year could come from federal, state, and local governments, as well as private investors.

The document also points out that the US is “one of the only leading nations without either a national plan for [PPPs] for infrastructure projects or a national infrastructure bank to finance large-scale projects and harness private capital” and that the US lacks “a national policy that would facilitate [PPPs] for large-scale, multi-jurisdictional projects”.

US politicians are criticised in the report for what is described as a lack of a coherent vision about infrastructure spending and for using earmarks to direct money to projects outside the country’s heavily travelled and “overburdened” metropolitan areas.

In an interview to promote the report on the Morning Joe television programme, Bloomberg said that the US had become a “Third World country compared to what you see elsewhere”, arguing, among other things, that US ports are not sufficiently up-to-date to accommodate new ships.

“The way government should work is the way a business works,” Bloomberg said on the programme, arguing that the US should try to find sources of funding to meet the country's infrastructure needs, rather than simply limiting infrastructure development on account of funding shortfalls.

Rendell, also appearing on the programme, said: “Just because the economy is in trouble doesn’t mean we stop investing in growth”.

Building America's Future was founded in 2008, according to the coalition's website, and is supported by the Rockefeller Foundation. The advocacy group describes its mission as “bringing about a new era of US investment in infrastructure”.