Infrastructure Deficit Called a 'Quiet Collapse of Prosperity'
Big city mayors testifying before a Senate committee are asking for more federal infrastructure investments, but admitted that even the $1.6 trillion estimated by the American Society of Engineers wouldn't be enough.
"Big-city mayors told Congress on Thursday that they are overwhelmed by the infrastructure needs of their regions and cannot maintain well-functioning water systems, roads and rail networks without more federal help.
'We're having a quiet collapse of prosperity,' said Kansas City, Missouri, Mayor Mark Funkhouser, one of four mayors to testify before the Senate Banking Committee about the state of the nation's infrastructure, which they agreed was poor and getting worse.
They blamed much of the decay on shortsighted thinking by local, state and federal officials.
The issue of the country's deteriorating transportation systems came under scrutiny last year with the collapse of a bridge in Minnesota that killed 13 people. Although experts believe that a poor design led to that collapse, the mayors sounded an alarm about decay throughout the system and its long-term effects on the U.S economy.
The American Society of Engineers estimates that bringing the nation's transportation and resources networks up to a properly functional level would require $1.6 trillion and five years of work. Still, the mayors say, even that wouldn't accommodate the new strains placed on roads in coming years.
To answer such demands, Sens. Chris Dodd, D-Connecticut, and Chuck Hagel, R-Nebraska, are pushing a bill to create a National Infrastructure Bank that would raise money for major national projects by issuing up to $60 billion in tax credit bonds, which could then be leveraged into greater funding."
- Login or register to post comments
- Email this page
Related News Stories
To Improve the Economy, Improve Infrastructure - Oct 05, 2008
The Real Bailout America's Cities Need - Sep 29, 2008
Top Freeway Teardown Candidates - Sep 23, 2008
Does Maglev Hurt High Speed Rail? - Sep 22, 2008
Predicting McCain and Obama's Effect on Cities - Sep 19, 2008
I happened to see part of
I happened to see part of that hearing on C-Span. There could be a number of reasons for declining prosperity, such as: weakening US dollar, higher energy costs, inflation, housing and credit bubble, space alien attack.....(just kidding on that last one.)
No doubt our infrastructure needs improvin'....all the more as we develop a first class system of international welfare, resettling folks that manage to come up with some silly reason why we should. And there are no serious signs of that trend letting up in the near future, so, yes, our infrastructure is getting outgrowed.
Every situation is going to be different, though. I have been studying how inadequate our transportation links are between Southwest Washington and our own liitle burg here. I had to drop all the way down the list of US metropolitan regions (among those situated next to another state and separated by a water barrier) to find one as inadequately equipped as our own. I found Memphis, Tennessee (pop.
Some cities like Boston might do fine with a MAX-like light rail system. OTOH, I have seen the one in San Jose in action though--pretty much a glorified bus route most of the day. But freeways might be too expensive. I like Halstead's idea of the double decker self propelled rail car. Somebody gave me a Colorado Rail Car brochure a few weeks ago, and they had their own design of one, too. There are some economical solutions out there. Don't panic yet.
And then instead of spending a billion or two to complete the I-405 route to Vancouver or plunk down a new bridge in the Camas-Troutdale area----we will embark on a Homerian Odyssey to solve our congested I-5 corridor by makin' the present structure even bigger---and that would be only the first step. I think we can fix our transportation issues--and have the ensuing financial prosperity, barring Asian competition, of course---but do it in a fiscally conservative way.
_________________
Submited by : Libros Gratis
Increasing taxes stimulates
Increasing taxes stimulates the economy in the following way:
Money gets collected, money gets spent on a project, money is paid out as wages to various workers who must work to complete that project. This is pretty straight-forward.
What hurts the economy is when vast amounts of money sit around unspent, as is the case with the wealthiest in this country. Even taking into account conspicuous spending on luxury items, there is a definite limit as to how much the rich can actually consume and therefore stimulate the economy. There is also a definite limit as to how much of this saved money can be re-invested.
Let's say 1000 dollars worth of goods are produced, but customers only buy 800 dollars worth of those goods. The next production cycle, the producer has only 800 dollars with which to make goods, so only 800 dollars worth of goods are produced. The whole cycle repeats until shut down. The solution to this problem so far has been to continuously increase the amount of credit which is extended to the consumer - a situation which is fundamentally unsustainable.
Let's suppose though that every dollar of saved money was somehow re-invested into various projects (which is impossible). That means that all of that money would have to go towards the construction of various things in order for the money to make its way to the consumer, and thus back to the producer. That means that for every cycle, additional production capacity would be added just so that the producer breaks even. However, at the start of the next cycle more goods are produced and sold as a result of the additional production capacity, requiring that the consumer have even more money, which requires the creation of more jobs and thus more production capacity, etc, etc. This is another one of those death spirals. It is impossible to continue to increase the amount of things which are made/sold for two reasons: limits on resources and limits on the ability of people to consume. Even the rich can only eat so much in a day, travel so far, try on so many outfits, watch so much television, etc. Therefore "growing" the economy as a solution is unsustainable and can only temporarily ease the situation.
As for the wealthy earning their money: I'm all for rewarding hard work, but it is obvious that at a certain point, the reward exceeds the contribution. Such a person is a parasite on society. Besides, we already have wealth redistribution, except it is being redistributed in the wrong direction.
Is there any possible reason why a single person would need more than $350,000 a year? Actually, you would be hard-pressed to find things to spend it on (we are talking personal income) after a certain point. This is why most of the money of the rich sits around unspent, even if they "re-invest". Do I need to go over why that's bad again?
Are you saying that every wealthy person deserves all of their money? Just because someone has a lot of money doesn't mean that they have earned it. It means simply that they were able to convince others around them that they deserved it, which is an entirely different thing if you want to think about it. (Coercion vs Work)
By the way, Albert Einstein was a socialist, but what did that guy know? Too much book-learnin', not enough "real-world business experience", right?
RE:
"Is there any possible reason why a single person would need more than $350,000 a year?"
My parents who will be in a fair amount of debt after sending both my sister and I to school certainly could use that increase in yearly income. But that will never happen as their combined yearly income puts them out of eligibility for any aid. Yet a child with a single mother on welfair goes essentially for free? Something wrong with this picture? Capitalism will allow me to work for a private firm where I will be rewarded for years of hard work and dedication. When I someday make six figures I will give my parents a large sum for their sacrifice.
"As for the wealthy earning their money: I'm all for rewarding hard work, but it is obvious that at a certain point, the reward exceeds the contribution. Such a person is a parasite on society."
So under this logic Bill Gates is a parasite on society? Providing nearly 100,000 people (just in Microsoft alone) with jobs with excellent benefits. While the federal government is decreasing college loan opportunities, Gates is giving away billions in scholarships and cancer and HIV research. The nerve of this guy.
I may be coming across as a very right wing person. This is not my intention. While I do lean to the right, I understand the importance of taxes and investment in infrastructure. However, I feel many Americans do not trust the clowns in Washington to make good use of their hard earned money. Speaking for myself, I do not mind increases in taxes when you can see a result. What I am sick of is taxes continually increasing while education is poor, and infrastructure is falling apart all the while congress is subsidizing incredibly idiotic projects like ethanol.
"Capitalism will allow me to
"Capitalism will allow me to work for a private firm where I will be rewarded for years of hard work and dedication. When I someday make six figures I will give my parents a large sum for their sacrifice."
Your parents must have done a terrible job of managing their money if they have accumulated so much debt that they need $350,000 a year to pay it off. That is absolutely ridiculous. $350,000/year puts you well into the top 2% of income earners in the country. The majority of people who pay off their college debt are not in the top 2%. If they found a way to pay off their debt without $350,000/year, than why can't your parents?
Matthew, I'm sorry to say this, but you have some delusional ideas. Capitalism has used up all the resources necessary to keep capitalism alive. Capitalism is now on its death bed. Peak oil ensures that your dream of working for a private firm and earning six figures will never become a reality. I am sorry to break this news to you but I feel that it is better for you to start thinking clearly about the future rather than spend your time in fantasy. Start preparing for the world as it actually exists, not the world that you want to exist. This will make you a happier person with or without the six figures. You have to bring your expectations in line with what reality can actually offer you, or else you are going to be disappointed.
Matthew your Bill Gates example is a laughable straw-man. One word: Enron. You simply cannot disprove my point:
Not *everyone* who is rich deserves their money. Period. What you are saying is that someone having money is proof that they worked hard to earn it. This is bordering on Calvinism, where success is taken as proof that God loves you. Kinda goes against the whole Jesus story, but I'm getting off-topic. Let's say I just stole a whole bunch of money. I'm rich, didn't I earn it? The fact that I have money is proof that I earned it, right? Now that I think about it, Bill Gates did steal his money in a sense since he worked for Apple and basically ripped off every single idea used to make Windows. Doesn't matter how generous you are with your money if it was stolen in the first place. The federal government is decreasing loan opportunities because it is currently **controlled by Republicans** As for the whole "providing jobs" thing that Republicans love to endlessly parrot, you will never create as many jobs as are eliminated through improved efficiency and technology. Think about that one for a minute because it is an irreversible trend which has been going on since the dawn of the Industrial Revolution. This "growing the economy" thing is not unique to republicans, Hillary talks about a green energy economy which will create jobs. My question is - what happens to all of those jobs once all of the solar panels get built? There will be a peak in employment in that field and then it will decline until it levels off, just as in any other industry. Besides, you can't grow the economy anymore since that requires resources that we don't have.
"What I am sick of is taxes continually increasing while education is poor, and infrastructure is falling apart all the while congress is subsidizing incredibly idiotic projects like ethanol."
First of all I will agree 100% on the ethanol thing. Ethanol is incredibly stupid. Secondly, what planet are you from? Where I live taxes are constantly being cut, with the result being poor education and infrastructure because governments don't have the necessary funding for these things. For example: the gas tax in Texas has not been raised in 10 years due to the efforts of the Republicans. Then we don't have enough money for roads so they have to be built as toll roads. Then the republicans complain about the toll roads, calling it "double taxation". Wtf.
Republican strategy: get elected, slash funds for various government agencies by reducing taxes. Then, after the agency fails to perform its duties due to a lack of funds, you stand up and declare "See, government doesn't work, I told you so! We need to lower taxes even more."
When did planetizen become a hang-out for right wing/libertarian idealogues? This place used to have a progressive vibe.
http://sustainablecity.blogspot.com/
Does Patrick Want More Consumption Or Less?
Patrick:
Your post at the top of this thread says that we should stimulate the economy by encouraging more consumption. But your second post in the thread says we have used up the world's resources and cannot support increased consumption.
Which do you believe, or how do you reconcile the two?
Here are quotes. At the top, you say we need more consumption:
"What hurts the economy is when vast amounts of money sit around unspent, as is the case with the wealthiest in this country. Even taking into account conspicuous spending on luxury items, there is a definite limit as to how much the rich can actually consume and therefore stimulate the economy."
Further down, you say:
"Capitalism has used up all the resources necessary to keep capitalism alive. Capitalism is now on its death bed." - which seems to suggest that we cannot support policies that promote more consumption to stimulate the economy.
Incidentally, I think you are wrong in the first quote, since the American savings rate is approximately zero, but I am more interested in how you reconcile the two.
Incidentally, also, I myself think that we should begin living more modestly and that we should abandon the post-war economic policy of promoting consumption to stimulate the economy.
Charles Siegel
Charles, I was responding to
Charles, I was responding to Matthew when he asked how increasing taxes could stimulate the economy. What immediately came to mind was the public works projects of the Great Depression, so I ran with that. Maybe I should have been more specific. I was not endorsing this as a policy, just pointing it out as a basic fact.
I wasn't saying anything about the savings rate per se - what I was trying to say is that unspent money does nothing to stimulate the economy, so allowing more people to have more unspent money does nothing to stimulate the economy, contrary to what Bush and his followers would like us to believe. From a production standpoint, money must flow freely from the consumer to the producer and back at all times. Savings is like a black hole that prevents this from happening, which is why we have credit. Of course, a person has to save under the current rules of the game just to get by. When you have savings, the money being returned to the producer is less and less with each production cycle. You can get around this problem by continually re-investing all of the savings into more production capacity, but this is obviously impossible since resources are finite and because you don't really need 1000 factories making the same widget - eventually the need for a product is met and any further production capacity is a waste of money because you would be unable to sell the things being produced, putting you back at square one. Economic growth becomes necessary when savings enter into the picture. Growing the economy has worked up till now because we have had plenty of resources to do it with, but that era has come to an end. This means that the whole idea of savings, and all of our economic ideas, have become obsolete.
Hope this clarifies things.
http://sustainablecity.blogspot.com
First off, with world wide
First off, with world wide demand rising fast the small amount (in comparison) of oil obtainable from drilling in Alaska would hardly impact the price of gas at the pump. Secondly we do need to find ways to pay for infrastructure. Part of the issue with roads is that the true cost has never really been paid for just with the gas tax. Roads have many costs that aren't normally calculated in and well now we are starting to see the results of these policies.
http://urbanmilwaukee.com
Exactly.
"Part of the issue with roads is that the true cost has never really been paid for just with the gas tax."
Solution? Increase the gas tax. Republicans, at least in my state (Texas) have prevented the gas tax from being increased for at least 10 years. This is a prime example of what I'm talking about.
Increasing Taxes?
I do not see how increasing taxes would "stimulate" the economy. You want to improve America's infrastructure? Stop subsidizing and making foreign oil cheap. However, because the Democrats will not allow us to tap our own resources here we are stuck. Currently Obama's economic policies will drive up taxes to some of the highest levels Americans have ever seen. I am sorry, but I am sure most Americans and myself included would like to keep 1 of every $2.00 we make. Furthermore, you state "we need tax increases on the wealthy - something along the lines of FDR's 98% tax." This is income redistribution and dancing right on the lines of socialism. Since when in this country did we start punishing those who are most successful?
Why is infrastructure collapsing?
Infrastructure is built and maintained using tax money.
Republicans demand lower and lower taxes, making less money available for infrastructure construction and maintenance. Mainly these are wealthy republicans who oppose taxes so that they can keep more of their ill-gotten wealth. Not so they can spend it/reinvest it and thereby stimulate the economy; they just want to take their money and stash it in an offshore account somewhere. Than the poor rural folk vote their aspirations (they vote Republican) and wind up screwing themselves.
Infrastructure collapses from a lack of maintenance, and everyone wants to know why this happens.
The most striking recent example of shocking-disregard-for-public-safety-so-that we-can-save-a-buck was of course Hurricane Katrina.
When the levies broke in 1927 in New Orleans the public works commissioner, Huey Long, declared that the rich were "drowning us". This was the start of a revolution that would continue with Roosevelt's New Deal.
Today, there is no revolution, even though there were bodies floating in the flooded streets of New Orleans. Clearly, the rich are drowning us - but how many more have to drown before something is done?
Instead of a revolution, we have Bush pushing to keep his tax cuts for the wealthy permanent - a move that would cause irreparable harm to this country and to democracy. On top of that, there is a push to eliminate the inheritance tax, which would take us back to the Feudal Ages. Instead of tax cuts for the wealthy, we need tax increases on the wealthy - something along the lines of FDR's 98% tax on all annual income over $350,000.00 (in today's dollars). There should also be a maximum limit on the amount of wealth that can be saved. That should give us plenty of money to build and maintain this country's infrastructure, as well as to provide universal health care to all.
End rant.