President Obama’s new budget proposes a bold, $300-billion push to modernize the nation’s aging and inadequate transportation systems over the next four years. Here at last is a call for action on the scale we need to get the U.S. economy out of its slow growth rut and back on a high-growth path. Two generations of federal underinvestment in public infrastructure has left much of it in disrepair, deterred private investment and limited the economy’s growth potential.
There’s only one problem: Obama’s plans to get America moving again by improving roads, ports and transit systems have been repeatedly stalled by ultra-conservatives within the GOP. It’s bad enough that there are those in Congress who automatically oppose whatever Obama proposes. But many far-right politicians also seem to have forgotten what they learned in Economics 101 – investment in public goods like transport, water and energy infrastructure are essential foundations for robust economic growth.
PPI’s forthcoming paper highlights new research conducted post-crisis confirming that the economic returns from infrastructure spending are enormous. In fact, our analysis shows an emerging consensus that for every $1 spent on transportation infrastructure, the increase in economic growth is between $1.5 and $2.
The United States faces an enormous deficit in transportation investment – almost $900 billion by 2020 by some accounts. Yet there’s no doubt that modern transport systems are essential to our nation’s competitiveness – to facilitate U.S. international trade, regional commerce, and local access to essential services. Not having access to fast and reliable public transit services could disproportionately affect the low-income and inner city populations relying most on fast and affordable public transit to get to work.
So we applaud President Obama’s proposal, and hope that Congress will finally start investing in America too.