Obama’s Infrastructure Request Is 1/40 1/25th of What We Need

Here’s what the White House fact sheet says about his call for infrastructure spending as part of his jobs bill.

Making an Immediate Investment in Our Roads, Rails and Airports: The President’s plan includes $50 billion in immediate investments for highways, transit, rail and aviation, helping to modernize an infrastructure that now receives a grade of “D” from the American Society of Civil Engineers and putting hundreds of thousands of construction workers back on the job.

Note they referenced the ASCE report card.

Assuming that means the White House agrees with the ASCE’s estimates for how much we need to spend to catch up to the rest of the developed world on infrastructure, his infrastructure request–$50 Billion–is less than 1/40th of what we need. ASCE says we need to spend $2.2 Trillion. (Note, he also called for $10 Billion in infrastructure bank investment–if you assume that will actually be set up and invested in publicly owned infrastructure rather than private projects, the ask would still need to be 36 times bigger.) Update: I originally didn’t include the $25 Billion Obama called for for schools because I thought ASCE did not, but I was wrong on that front–the 1/25th number reflects the $50B for infrastructure, the $10B for an infrastructure bank (though that’s a problematic scheme), and the $25 for schools.

Frankly, I think Obama shouldn’t have called for a jobs bill. Rather, he should have got up before Congress and said that our declining infrastructure is the most visible symptom that we, as a country, are declining and that we need to stop that decline right now. He should have said that our shoddy infrastructure not only makes it harder for our businesses to compete, but makes us more vulnerable to terrorism, to extreme climate events, to business incompetence. He should have called for the full investment (borrowing money right now is, after all, effectively interest free), and told Republicans that if they didn’t provide the funds to prevent our country from falling into decrepitude, it was just proof they hate our country and want the terrorists to win.

$2.2 Trillion (or even a significant fraction) invested in infrastructure would have created far more jobs than any payroll tax cut, trade deal, or work-for-free jobs program.

And now–the eve of the 10 year anniversary of 9/11–is the time to do that, as conveyors of conventional wisdom (David Sanger at the NYT?) note what those not profiting off the Counterterrorism Industrial Complex have noted for some time: we wasted far too much on stuff that doesn’t make us safe.

A survey by The New York Times, detailed in the accompanying chart, puts a stark price tag on the cost of reacting — and overreacting — to the defining event of the past decade. America’s bill for fighting a 21st-century “asymmetric war” comes to at least $3.3 trillion. Put another way, for every dollar Al Qaeda spent to pull off the Sept. 11 attacks, the cost to the United States was an astonishing $6.6 million.

Today, Al Qaeda in Pakistan is crippled and Bin Laden is dead. But the $3.3 trillion figure suggests that the unanticipated costs of how we managed a grim decade — money already spent or committed in the future — amount to a little more than one-fifth of America’s current national debt.

Some of those were unavoidable, direct costs of responding to the attack. Some, like the Iraq war, were expenditures of choice. But there is also the more difficult, less quantifiable question of what we paid in “opportunity costs.”

Less than a trillion dollars of the $3.3 trillion was for direct responses — including toppling the Taliban. But what if at least some of the remaining $2 trillion plus had been spent on other, longer-range threats to American national security? Rebuilding a broken education system? Finding more imaginative ways to compete with China? Reducing the national debt? Or delivering on promises, by President George W. Bush and Secretary of State Hillary Rodham Clinton alike, for “Marshall plans” to rebuild societies at risk of letting the next Al Qaeda flourish?

Frankly, I agree that education deserves some of this funding as well as infrastructure investment. But note that that figure–what Sanger considers discretionary among our counterterrorism spending–is just about what we need to fix our infrastructure.

We just need to start fearmongering and loyalty baiting like Republicans do on wars to make it politically dangerous not to fund this stuff.

20 replies
  1. BoxTurtle says:

    Asking for 1/50 is more than I expected of ObamaLLP. I suspect they wouldn’t have asked for that much, if they thought his plan had a snowball’s chance of passing congress.

    We know where to spend the money: Infrastructure, education, health care. We know where to get the money: Incomes over $100K, corporations, Wall St.

    But the “how” seems to be beyond any of our current crop of politicians.

    Boxturtle (Might have something to do with where the politicians get THEIR money)

  2. allan says:

    Just to note: at current 2% rates on 10 year Treasuries,
    the full $2.2 trillion could be borrowed for $45 billion/yr in interest payments.

  3. PeasantParty says:

    It really makes a person sick. It seems that this is another excuse to cut Medicare and Medicaid in order fund a tiny little job proposal.

    In the meantime, this morning the House is debate/vote grandstanding on 2012 Intelligence bills! Oh, and they had no problems voting up 50 billion to rebuild Iraq with no offsets. It’s just American citizens and the country that have to be under the big thumb of DUMB!

  4. AH says:

    I fully support full infrastructure funding, both for the jobs it would create and the long term economic competitiveness benefits. But this post glosses over the facts around US infrastructure funding and mis-interprets the ASCE report.

    The ASCE report does identify $2.2T in infrastructure needs – over 5 years. The report goes on to say that 50% of this need is expected to be funded based on existing infrastructure spending levels by federal, state and local gov. This leaves an infrastructure deficit of $1.1T – which if you break it down over 5 years is ~$200B annually.

    Now, historically in the US the federal government is NOT the dominant funding source for public sector infrastructure projects. In fact, public sector infrastructure funding has been paid for historically by 25% federal, 25% state and 50% local government (this comes from the CBO and academic studies). So, if you break down the ~$200B annual infrastructure deficit into the federal government share (25%), you get an annual federal government infrastructure deficit of $55B.

    I haven’t dug into the details of the President’s proposal, so I don’t know the time period for his proposed $50B – and I would certainly have liked to see a higher number – but it’s certainly not as skimpy as the post implies. And while it is true that many local and state governments don’t have the resources right now to make these investments – I would argue that it would be a mistake for the federal government to assume full funding responsibility for state and local infrastructure, and it would abdicate state and local leaders from having to find ways to pay for local infrastructure (i.e. raise taxes and/or reallocate spending).

  5. rg says:

    Thank you for this information. Forty-five billion a year sounds like a lot on top of all else we’re funding.I wonder, further, if you can figure what the repayment would look like with the principle included. Perhaps Pleasant Party’s “tiny little jobs proposal” wouldn’t look so tiny. It seems to me that, for all the good reasons to conduct such an infrastructure renewal, that it’s difficult to justify the expense, as the Tea Drinkers are eager to point out (here I mean the broad spectrum of citizens that respond to the Tea message, and not those manipulating such sentiment for political subterfuge).

  6. PeasantParty says:

    @rg: I wish I could be happy about it. It is an initial investment that has be voted on. What happens after that initial investment?

    They continue to shove money at reconstruction for Iraq and Afghanistan 50 to 80 billion a whack several times a year without a budgetary offset. My disappointment is that they/congress don’t see the shame in it. They have spent 5 times that already this year for rebuilding the middle east. JUST THIS YEAR! They have plenty of work going for roads and infrastructure in every country we have feet on the ground in.

  7. emptywheel says:

    @AH: Thanks for the comment.

    It’s actually not clear whether this $50B is new spending, or just the regular spending at the levels Dems want (so it may be that 50% you’re talking about).

    And while I agree that the US should not make the decisions on infrastructure funding, this spending is not going to happen anytime soon unless the US chips in. Using infrastructure spending to prevent a double dip is a good time to do it.

    And of course, there’s the negotiation question. This is what the need is. It’d help to get something if you lay out how bad the need is.

  8. AH says:

    I agree with your point that now is a great time for infrastructure spending and that as a negotiation tactic its helpful to peg a higher level as the opening offer.

    And in fact, I think the ASCE report may significantly understate the infrastructure needs in the US – because ASCE focuses on bringing existing infrastructure up to standard (and includes a significant backlog of accumulated maintenance). I don’t believe that it includes NEW infrastructure capacity that would facilitate long-term economic growth – it’s somewhat unclear from the report what is or is not included (for example building out high-speed rail or a next generation air traffic control system or building out local mass transit – I don’t think any of those are included). Any estimate of that need would likely be 2X higher (or more).

    The thing about infrastructure spending is that when you break it down and look closely its actually not a huge lift to revitalize US infrastructure – it does take making infrastructure a priority – and even adding a couple of % over a sustained period would make a big difference – and I wish the original stimulus and the new stimulus would have reflected this. Even better would be to bake higher infrastructure spending into the base budget (whether through an infrastructure bank or straight spend) so its sustained year-over-year.

  9. emptywheel says:

    @AH: By my read, the ASCE report doesn’t include broadband at all. I see now it does include schools–so I guess my numbers are off there because I didn’t count the school $$.

    It does include transit though.

  10. scribe says:

    @emptywheel: No matter how you slice it, the proposed infrastructure funding is woefully inadequate.

    And, if you look at highway projects, a lot of them have signs explaining the funding breakout, and a lot of them, the funding is over 90 percent federal and less than 10 percent state/local. Getting federal funding is, for most state and local highway work, the sine qua non of starting the project.

    No, this is Blankfein’s Houseservant Obama trying to win back his voter base after bitchslapping them, their interests, desires and wallets silly for the last three years. There’s nothing to guarantee he won’t go back to his old ways, and worse, if/when he wins re-election.

  11. Jim White says:

    It just occurred to me that it might be for the best that Obama won’t take this on in a massive way. Given the way he refuses to enforce regulations or prosecute fraud, the resulting construction would be hopelessly shoddy and would only enrich fraudulent large construction companies.

  12. Arbusto says:

    Again ready, fire, aim. The infrastructure modernization/repair,for highways, transit, rail and aviation, while helping that section of construction and associated support industries, is very automated. More bang for the bucks would be carpenters, plumbers and electricians modernizing schools and government offices. Of course this proposal and resultant cave in bill is all about reelection, not citizens.

  13. ezdidit says:

    huh…every time I’m away from here for a while, I wonder why I ever left. (same with digby and Glenn Greenwald)

    You make some of the most incisive and realistic statements about our world and the idiot powers-that-be. Have you sufficient hubris as yet to run for public office, Marcy? Because if you think this little blog of yours is not a sufficient platform, I think you are very much mistaken. It is. But I don’t hear the hubris as yet. I just hear a guffaw, a chortle or a chuckle every now & then. You make it sound like you have better things to do, and this is just a part-time gig anyway.

  14. allan says:

    With the 10 year rate down to 1.9% today,
    we’re down to $42 billion/ year in interest.
    And in 2021, we can roll over the $2.2 trillion,
    just like we’ll be doing anyway for the $1 trillion plus
    in debt that paid for the Bush/Obama Forever Wars.

  15. Gitcheegumee says:


    More bang for the bucks would be carpenters, plumbers and electricians modernizing schools and government offices…arbusto

    Ahem…NO doubt they would consider that to be more bang for the buck with NON-union carpenters,plumbers and electricians and undocumented workers modernizing schools and government offices….

  16. alinaustex says:

    Here in Central Texas we are surviving massive wildfires . The Texas Forest Service Firefighters budget was slashed last year from $ 117 million to $ 82 million . Fire fighters in Bastrop County are having to buy their own disel fuel .We need to think about how to help first responders -as we rebuild our infrastructure. For example how do we get better use of our broad band to help better coordinate different jurisdictions fighting the same 34,000m acre wall of fire.?
    And PS .. Gov Perry was the main political force down hear cutting the budget for first responders .

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