Tuesday, October 6, 2015

U.S. NOT SPENDING ON INFRASTRUCTURE

Does this affect US global competitiveness?

 

As Infrastructure Creaks, Congress Dithers

Lack of agreement on long-term funding plan fuels voter rebellion against the political establishment

Rush-hour traffic on freeways in Los Angeles, a region that routinely tops the nationwide list for congestion delays. ENLARGE
Rush-hour traffic on freeways in Los Angeles, a region that routinely tops the nationwide list for congestion delays. Photo: Patrick T. Fallon/Bloomberg News
Back in July, Congress failed, once again, to pass a long-term highway bill to make improvements in the nation’s transportation system. Instead of funding big infrastructure needs with a multiyear plan, as once was the norm in Washington, lawmakers passed a bill covering a grand total of three months—the 34th time since 2009 Congress has passed a temporary Band-Aid measure rather than a long-term one to address the nation’s most basic infrastructure needs.
So, while Congress was failing to do its job, were other nations out in the competitive world economy standing still? Hardly. Consider a few projects that are moving forward while Congress squabbles:
Cuba, with funding from Brazil and logistical aid from Singapore and China, continued to develop a new deep-water port that, unlike most on the U.S. east coast, will be able to receive the big Panamax container ships that can pass through the newly enlarged Panama Canal.
In India, Prime Minister Narendra Modi pushed ahead on a plan for $12.6 billion in new roads and $16 billion in railway improvements to crank up economic development in the world’s ninth-largest economy.
China plans to spend $13 billion on a new airport that will have the world’s largest passenger terminal.
Indonesia moved forward on plans for its first high-speed railway, and appears ready to pick a Chinese firm to build it.
Meanwhile, Washington remains stuck in the partisan mud. That stopgap bill, passed to at least keep road and bridge repairs and improvements moving along during the summer months, expires at the end of this month. It will surprise nobody to learn that Congress still hasn’t come up with a plan to keep funds moving.
Perhaps outgoing House Speaker John Boehner will get the job done before he also departs at the end of October; the man most likely to replace him, Rep. Kevin McCarthy, says he’d like to pass a long-term highway bill. But a good-faith effort by Republican Rep. Paul Ryan, head of the Ways and Means Committee, and various Democrats to agree on a corporate tax reform to finance a long-term transportation bill has failed. Democrats and Republicans can’t agree on how much to spend or how to finance it, so there is a good chance Congress may at month’s end pass only another short-term measure to keep highway spending limping along temporarily.
There may be no better example of the kind of Washington dysfunction that has voters in rebellion against the political establishment—and no example that more directly affects real life in the country—than this failure. The standard practice has long been to pass a highway bill of six years’ duration to provide the kind of funding stream that states and cities need to plan and execute serious transportation projects. Today, that has proven impossible.
Worse, that is merely symptomatic of a failure to deal with much broader infrastructure needs, and the economic costs of that failure simply keep mounting. A recent report by the Business Roundtable chronicled some of the problems:
America’s overall infrastructure quality ranks only 16th in the world, meaning it lags behind Germany, France and Japan. The U.S. is home to just four of the world’s 50 top airports. Nearly one in four U.S. bridges is structurally deficient or functionally obsolete. Urban highway congestion costs the economy more than $100 billion annually. On the nation’s waterways, port congestion, lock delays and lack of facilities for larger ships adds billions to the cost of products annually.
Those problems with ports and waterways may be the best illustration of how the nation’s unmet needs extend well beyond fixing potholes and shoring up bridges. Only two of the country’s 14 major East Coast ports—Baltimore and Norfolk, Va.—are ready for the new deep-water ships that can transit the Panama Canal; Miami’s will be soon.
But it isn’t just the need for deeper ports, which private industry and states might be able to finance themselves. The problem is that bigger ships create the need for a rail and road network that allows them to be efficiently offloaded and their goods moved quickly to a final destination. Thus, better surface transportation is essential to bigger ports.
“If you don’t have an infrastructure bill, that doesn’t come about,” says Jay Farrar, manager of the Washington office of Bechtel, an engineering and construction firm.
Meanwhile, Cuba, of all countries, is busy building that giant new port to compete with U.S. facilities as a regional transshipment port. Moreover, even bigger ships than the ones now able to transit the Panama Canal are being built, and some nations already are planning or building giant offshore terminals capable of handling them. “Other nations,” says Mr. Farrar, “already are ahead of us.”