Report: Making transport investment for long haul
U.S. Congress and the White House should prioritize transportation infrastructure investment based on its long-term impact on economic productivity and short-term ability to create jobs, according to a report released Friday by the Bipartisan Policy Center.
The federal government can no longer afford to spread transportation dollars equally among projects in an era of severely constrained resources and pressing needs to upgrade long-neglected infrastructure as the growing population continues to put pressure on the system, said authors Douglas Holtz-Eakin and Martin Wachs.
Congress during the past two years has thrown more than $83 billion of general treasury funds at the surface transportation system through the 2009 stimulus bill and bailouts of the Highway Trust Fund. Much of the spending was focused on quick-start projects that could generate construction jobs without effectively alleviating congestion or improving transit times in the most important travel corridors, critics have said.
The trick, the two policy experts say, is to target spending on projects that foster additional private sector investment — such as warehousing — to take advantage of the infrastructure and create long-term employment opportunities, while generating near-term jobs to build the infrastructure.
'Hastily spending tens of billions of dollars on 'shovel-ready' projects for the primary purpose of immediate job creation risks misallocating resources in ways that fail to maximize overall returns to the economy,' the report said.
Matt Rose, chairman and chief executive of BNSF Railway, made a similar point at a conference last November about how the current system waters down federal transportation spending to the point that it doesn't have the intended effect.
Freight interests haven't become politically strong enough on Capitol Hill to win appropriations for intermodal, port or highway connectors that help improve productivity of cargo transportation, Rose said at the event held by the National Industrial Transportation League and Intermodal Association of North America.
'And that lack of voice allows the members of Congress to go off and do projects and spread transport dollars like peanut butter when in fact about 70 percent of GDP is created in 30 cities,' where carriers experience their biggest costs dealing with traffic impediments, he said.
The two policy experts recommended that the government not justify transportation spending simply as a means to generate jobs, especially when borrowed funds are involved.
Several other policy studies since 2009 have also called for more accountability in transportation spending so that money goes to programs that are most likely to produce desired results, such as measurable reductions in air pollution, accidents or congestion.
Holtz-Eakin is a former director of the Congressional Budget Office and served as domestic and economic policy adviser to Sen. John McCain during his 2008 run for president. Wachs, a civil engineer by training, is a senior principal researcher at the RAND Corp., having recently stepped down as director of the Transportation, Space and Technology Program. ' Eric Kulisch