NTPP: Infrastructure Investment Will Only Boost the Economy If Done Right

At the federal level, we’re nearly flat out of transportation money and spending most of what’s left to stimulate highway construction jobs. It’s a double whammy that could present a bleak future for federally-funded transportation projects.

Photo credit: ##http://www.flickr.com/photos/mvjantzen##M.V. Jantzen##
Photo credit: ##http://www.flickr.com/photos/mvjantzen##M.V. Jantzen##

A new report by the Bipartisan Policy Center’s National Transportation Policy Project (NTPP) challenges the country to envision a national transportation policy based on clear-cut, objective long-term criteria. With tight federal budgets and the end of stimulus money, NTPP says this is the perfect time to revisit the direction of transportation policy and spending.

Notably, the report is authored by Martin Wachs of the RAND Corporation and Douglas Holtz-Eakin, a top economist in the President’s Council of Economic Advisers under both Bushes and a policy advisor for the 2008 McCain-Palin campaign. It’s encouraging to see a Republican stalwart coming under an explicitly bipartisan umbrella to find common ground on infrastructure spending.

The report’s main recommendations are three-fold:

  • Balance the selection of quick, easy “shovel ready” projects with those producing long-term economic benefits.
  • Revise transportation policies to focus on economic growth and sustainable job creation.
  • Stop borrowing money to finance transportation spending and short-term job creation.

The authors emphasize that just because a project is “shovel-ready” does not mean it will produce lasting economic benefits, and they reject the notion that infrastructure projects can be evaluated based on immediate job creation or “multiplier” effects.

Studies often tout the job-creating power of certain types of transportation investment — be it roads, transit, or bike infrastructure. And the USDOT, for instance, estimates that each $1 billion spent on the federal highway system supports, on average, 30,000 jobs. The authors contend that there’s no data supporting this number and say the greatest economic benefit of transportation investment may lie in lowering the costs of business transactions, not job creation.

The authors also advocate for a “mode-neutral” approach to judging which transportation projects create long-term economic impacts — in other words, they don’t favor highways or transit. And they suggest that federal transportation dollars are currently disbursed to states without regard to the effectiveness of that spending.

The authors do criticize current policies that prioritize new highway construction over operations and maintenance, noting that maintenance typically requires more spending on labor than materials and can create jobs that benefit the local economy.

  • Clutch J

    Marty Wachs is the dean of CA transportation intellectuals. In 1997, while director of the University of California Transportation Center, he was asked to respond to Rutgers Professor John Pucher’s research into European policies that promote bicycling and deter driving. He offered a cogent analysis of bike advocacy progress to-date, including the battle over the Bay Bridge bike lane and the then-riotous Critical Mass. His closing paragraph:

    “In a democracy there is simply no reason to adopt major changes in policy as a result of scholarly studies or technical findings. There is every reason, however, to adopt policies that respond to vocal and persistent interest groups that demonstrate they have staying power in the political arena. Whether or not cycling catches on in America will depend upon the success or failure of grassroots movements like the one that is now thriving and growing in the San Francisco Bay Area.”

    More wisdom from Wachs here–
    http://bostoncriticalmass.org/wachs.htm

ALSO ON STREETSBLOG

GOP-ers and Dems Agree: Feds Need to Get Their Transpo Act Together

|
Reports on federal transportation policy — like campaign fundraisers and lobbying groups — seem to proliferate in Washington, most of them drawing a few days’ worth of news coverage before fading from memory. (Remember the National Surface Transportation Infrastructure Financing Commission and the National Surface Transportation Policy and Revenue Commission?) Former Sen. Slade Gorton (R-WA), […]

Former US DOT Bosses Call for Mileage Tax and Congestion Fees

|
Bottlenecks cripple our productivity, and transitioning among modes of transportation remains a convoluted and inefficient process nationwide, with some major cities being the few exceptions. Concerns about the environmental impact of these inefficiencies further highlight the need for systems that offer quick, interconnected and efficient means for transportation. The message today from two Republican-appointed former […]

New Report Maps the Gap Between Pedestrian Risks and Federal Safety Aid

|
The top 10 most dangerous cities for pedestrians. (Chart: Dangerous by Design report) If the equivalent of one jumbo jet full of Americans died every month, the resulting public outcry would be deafening. Or would it? Anne Canby, the former Delaware transportation secretary who heads the Surface Transportation Policy Partnership (STPP), raised that question today […]