Obama's Unambitious Infrastructure Plans

The New York Times reported yesterday that it obtained a draft of President Obama’s announcement on his infrastructure plans.

John Swartz writes, “The first element of the plan is a “fix it first” policy that calls for investing $50 billion in transportation infrastructure […] the second part of the plan would draw on private investment from across the nation and around the world for federal, state and local projects […] the third portion of the plan would work to eliminate red tape in permits and review for infrastructure projects.”

Let me first say that generally, I view Obama’s ‘middle way’ approach to governing as appropriate, and at this moment it seems to be the only way to be politically constructive as a center-left politician. However, I found these plans to be less than stirring, and in stark contrast to his SOTU speech.

Being hopelessly optimistic, I had hoped for a Grand Bargain that would replace our sequester (which is only six days hence) that would’ve exchanged some of those cuts to entitlement programs for infrastructure spending–a national project that could both get people back to work and spark a new kind of American pride and unity. Unfortunately, the topic of ‘what kind of infrastructure our country needs’ is no less fraught with debate than any other today. The Tea Party calls for no new government and no new taxes, and although I’ve seen more than a few of their bumper stickers hovering over that socialism-wrought asphalt, they remain unpersuaded.

Obama is expected to announce that he will accomplish all that he can without Congress, although given how conservative these plans are, I don’t see why–but I am sure they will not disappoint him. Unfortunately, infrastructure spending will not get the political attention and support that the minimum wage increase did. Unfortunate because the economic potential for growth is much greater, and would mean a lot of (not minimum wage) jobs. At a time when independents like myself were whet with anticipation at what might’ve been Obama’s second term Affordable Care Act, Obama douses ice-water on an already cold political issue.

It is still very early to be so condemning, and perhaps this is just Obama’s business-friendly way of broaching the issue while also gathering some capital together for future plans and projects, but I hope something more meaningful is in the cards for this term. I do not want to diminish the real good this would do. The national highway system is by far the most used of our public works, and their maintenance is paramount for travel, commercial trucking, and 7/11s. It means jobs, which as Obama points out, cannot be outsourced, and the better transport is, the more the U.S. should be able to export. Even in tough economic times, most economists agree that infrastructure spending is a good use of even-borrowed capital, and can help stem the growth of certain entitlements, and although fixing roads and bridges does constitute growth, simply getting government to work again does not inspire much enthusiasm.

A portion of this transportation measure is no doubt intended to countervail Obama’s demand for higher-fuel efficiency back in his first term. The new standards called for “27.5mpg in 2010 to 35.5mpg starting in 2016 and 54.5 starting in 2025.” Manufacturers met the current standards and we are, naturally, paying less in transportation taxes that are collected through purchase of gasoline. It is a cost-shifting measure that makes this effort constructive, but that much more meager.

If you didn’t already know, the U.S. is currently home to only one high-speed rail, which runs along the Northeast Corridor (NEC) in the Northeast United States between Washington, D.C., and Boston via Baltimore, Philadelphia, and New York City. Part of Obama’s 2009 stimulus package included a federal allocation of $8 billion for high-speed rail projects, but governors of some of the states where they were to be built cancelled the projects.” It is undoubtedly in response to this kind of unaccommodating reaction from conservatives that Obama looks to plans with more viability.

High speed rail is a 30 year-old technology, and should be well within our capabilities to expand. The high-speed rail from NYC to D.C. currently runs on standard Amtrak lines, and is capable of going 150mph. Given entirely new infrastructure between large cities in other U.S. regions, faster trains with higher capacities can feasibly be built within the decade. After all, in China “work crews of as many as 100,000 people per line have built about half of the 10,000-mile network in just six years.” The U.S. would likely opt for shorter lines of track between coastal cities. Western states make up too small a population to justify the cost of commuter trains, so alas, flyover states shall likely remain such.

The electric-car charging network is poor at best, and sadly is the greatest deterrent for those considering that option. Range-anxiety is the biggest reason people report choosing smaller, gas-only or hybrid vehicles over pure electric. Attractive rebates are offered to those buying electric vehicles, but I would suggest that certain or all gas stations should receive similar incentives to support charging stations, especially when little more than electricity is required. The current stations are at select gas stations and some of the dealerships that sell EVs.

Just as he did for the Affordable Care Act, Obama is reaching out to business to create a hybridized federal-private form of infrastructure investment, with the added incentive of bypassing regulatory hurdles. We shall see if that is enough grease for the squeaky wheel of a Congress that is literally losing a popularity contest with colonoscopies.

Stay tuned for my wish-list for energy infrastructure, and the problems that energy reform pose.

You can follow me on Twitter @NeoKubrick, and on Facebook under Russell Winfrey or 22 of the Day.

Author: The Blue Route

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