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Obama’s Potholed Budget
The budget’s transportation spending is unaffordable and unnecessary.


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‘America is one big pothole.” This is how Transportation Secretary Ray LaHood describes the state of America’s infrastructure. He’s not alone in his hyperbole.

In his State of the Union address, the president lamented that “So much of America needs to be rebuilt.” Some pundits put it more alarmingly. Paul Krugman has lamented that America’s infrastructure is “starving,” “fraying,” and “going backwards . . . on the unlit, unpaved road to nowhere.” Last summer, Jacob Weisberg of Slate wrote that our infrastructure is “increasingly third world.”

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The only thing that can save us from this mounting crisis, then, is immediate, substantial spending on infrastructure to fill in America’s potholes, light America’s sidewalks, repave America’s roads, and generally restore our infrastructure to First World status. Obama’s budget is aimed at doing just that. The president’s Transportation Department request would appropriate $476 billion for surface transportation over the next six years. This includes $305 billion for rebuilding highways and bridges, $108 billion for local transit such as buses and subways, and $47 billion for high-speed rail (to finally ignite the long-awaited high-speed-rail boom). In addition, $50 billion would be retroactively allocated to the 2012 budget, which already devoted $71 billion to surface transportation.

Despite the seemingly unanimous consensus that America’s infrastructure is quickly deteriorating, the situation isn’t as drastic as advertised. In fact, there are some areas in which America is the envy of the world, such as our freight railways, which “are universally recognized in the industry as the best in the world,” according to The Economist. Overall, as Charles Lane noted in the Washington Post, the U.S. comes in second (to Canada) when compared to 19 other countries of similar geographic size in the World Economic Forum’s Global Competitiveness Report. Among the 20 most populous countries in the world, America is fourth, behind only France, Germany, and Japan.

But even if we don’t urgently need them, could massive infrastructure investments spark job growth? The Obama administration has argued that this spending would “jump-start job creation in 2012” in construction, the sector which has struggled most during the recession. In fact, unemployment among construction workers was 17.7 percent in January. But according to the Federal Highway Administration, it usually takes between nine and 19 years to complete a new major federal highway project, including four or five years of planning. Certainly smaller repair projects would have a shorter preparation period, but the projects that create the most jobs won’t get started until 2016, or later.

Infrastructure spending is also defended for being, in some sense, budget-neutral. Much of the Department of Transportation’s budget would be paid for by the gasoline tax, which is forecast to take in more than $190 billion over the period. Further, about $281 billion of the request is to be covered by money “saved” over the next ten years because of drawdowns in Iraq and Afghanistan. However, during a hearing with Secretary LaHood, Senator Kelly Ayotte (R., N.H.) called this “a budget gimmick.” The senator pointed out that money that might have been spent in Iraq and Afghanistan should count as money saved only if you assume we would have maintained the same presence in both countries for the next ten years. Otherwise, the $281 billion allocated to the Department of Transportation is simply money that isn’t being spent on the military, which is the same as all other money that isn’t being spent on the military.  

While this transportation budget is ultimately unlikely to pass (transportation expert Sam Staley of the Reason Foundation calls it a “wish list”), the attention devoted to infrastructure spending in the document signals that lines like “We need to rebuild America” will be a big part of the president’s campaign message. But, in a nutshell, we don’t need the spending, it wouldn’t help much for current job creation, and we don’t have the money to spend.

— Nash Keune is a Thomas L. Rhodes Journalism Fellow at the Franklin Center.



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