This post started off as a reaction to this piece at RealClearPolicy by Randal O’Toole but it has transmogrified into musings on transportation, infrastructure, and politics.
Did you realize that the House had passed an infrastructure spending bill? Me, neither. Or that the bill they had passed leaned so heavily on inter-city rail transport? Although I like and have used inter-city rail transport, I recognize that it is not particularly practical, especially for freight. Buses are more efficient for passenger travel; trucks for freight. Leaning into inter-city rail, particularly for passenger traffic, only makes sense in the Boston to Washington corridor. It is another case of what I have deemed “One Size Fits New York”.
Infrastructure spending bills serve many purposes. They are seen as a way of stimulating the economy, particularly by folk Keynesians of the stamp of those in the Congress on both sides of the aisle. Genuine Keynesian stimulus requires different circumstances than those we face right now. For one thing for there to be a multiplier (the near term benefits exceed the near term costs) we would need to be making more of the things we buy in the United States. For another much of the decline in aggregate demand is due to uncertainty about the future which an infrastructure spending bill of any sort will do little to quell.
Such spending bills are also ways of channeling money to political allies. They are basically a form of corruption. Infrastructure spending bills are also political statements.
As much as anything else infrastructure spending bills are predictions of future value. All told I can hardly think of a worse time for a major infrastructure spending bill than today.
Due to the way construction is done in the 21st century it would create few jobs, little equipment would be purchased, and very few people would actually benefit for reasons I outlined above. If you had asked me a year ago about the future of transport my answer would have been nothing like my answer today.
Do you really think that people are going to want to be crammed into crowded conditions in airports, railway stations, passenger aircraft, or railway cars over the next year or so? In one year? In ten years? I don’t know about you but I am seeing television advertisements for driving vacations. My point is not that personal transport is better than rail or air transport. It is that right now the future is just too uncertain for confident predictions.
Why not concentrate investment in areas we are confident will be useful over the productive life of the structures being built? The power grid, Internet connectivity, improved sewers. Speculation inter-city rail seems remarkably imprudent.
But it’s an election year. The only thing likely to be of any concern is the value of legislation as a political statement.
Antiplanner notes that COVID-19 has reduced ridership in various mass transit operations from between 50% to over 90%, with the higher limit being more common. This despite the fact that every city kept its mass transit open. The betting is whether the missing riders will return.
The other bit of info is that many companies now know they do not need their workers in the office. Which really means they don’t need expensive Americans; Indians will suffice. Expect lots of office jobs to disappear in America and be transferred overseas. Surely, if you can build a car engine in another country, an engineer in Poland can design it.
The other issue is that public works projects a huge lead times. There are literally no shovel-ready projects anywhere. The time from conception to opening Freedom Tower was about 12 years, five to begin construction and eight to complete. That is typical. Expect any large public works project to take 10 years between conception and opening. Even if the Senate approves the bill and Trump signs it, those projects won’t even start for two to three years and won’t be completed until nearly 2030.
And how confident are we that a project that seems to make sense now will make as much or more sense in 2030? Let alone 2050 (the expected life expectancy of the project).
‘Even if the Senate approves the bill and Trump signs it, those projects won’t even start for two to three years and won’t be completed until nearly 2030.’
With all of the environmental roadblocks and other red tape being applied to each and every project, we’re unlikely to see them completed in my nieces’ lifetimes (they’re in their 20’s). Look at Governor Brown’s Express Train to Nowhere. Look how long it took for the last NY subway to be completed. In my back yard they were working on the Route 202/422 interchange when my family moved back to the States in 1970. It and the adjacent Betzwood Bridge are still being ‘improved’ 50 years later, and the entrance ramp to 422 continues to be the most poorly designed quarter-cloverleaf I have ever had the misfortune to have driven on (God knows why more cars haven’t driven off it or have had accidents on it).