AN AMBITIOUS NECESSITY

FullSizeRender

^ Boston’s Building Trades mayor welcomes Hillary Clinton to a rally of unionists at Faneuil Hall (photo by P J McCann)

—- —- —- —-

We usually don’t write about the Presidential campaign going on in America right now. There’s more than enough policy to talk about right here in Massachusetts. Besides, the national campaign’s demagogic bullying is better ignored than fed into. Today, however, we make an exception for the $ 275 billion infrastructure proposal advocated by Democratic candidate Hillary Clinton at a rally on Sunday at Faneuil Hall.

There, endorsed by Mayor Marty Walsh, speaking to a crowd of about 500 Building Trades and laborers unionists, Clinton proposed the $ v275 billion plan along with other, private infrastructure allocations adding up to $ 550 billion in all.

As the AP reported : “Clinton’s campaign said she would allocate $250 billion to direct investment by the federal government in crumbling roads, bridges, public transit and airports. An additional $25 billion would fund a national infrastructure bank, an idea unveiled by President Barack Obama in his first term that has been blocked repeatedly by congressional Republicans. The bank would support $225 billion in loans intended to spur private investment in struggling projects, adding a total of $500 billion in new infrastructure funds into the economy, her campaign estimates.”

The politics of her proposal — rallying building trades unions to her side — matter less to me than the feasibility of her initiative. That our nation needs massive infrastructure spending, no serious activist can doubt. Roads, bridges, rail lines and signals, commuter rail and urban transit all suffer from decades of deferrals. The economic consequences stagger us. If people and goods cannot get to where they are directed, efficiently and on time, the economic loss, to the nation and to individual people and families, defies measurement. Our economy is transactional; and transactions involve delivery of the thing (or individuals) transacted from seller to buyer. Transportation is the deliverer. If the delivery is hampered, or impeded, or sometimes stopped altogether by transportation boggles and breakdowns, the economy boggles and breaks down as well. If union workers are available to make our transportation systems go smoothly, let’s get them working; let’s be glad that they’re there.

Nor is there any reasonable doubt that Clinton’s $ 550 billion total proposal will by itself enormously spur the economy. Building trades workers earn fat paychecks, and the ones I know spend most of that right back into the economy. After all, they work hard, often outdoors in bad weather, for long hours, sometimes at night. Are they then not entitled to spend their earnings on good time stuff ? Their spending enables all kinds of businesses : boat builders, marina operators, vacation hotels, swimming pool installers, builders of home additions, truck dealers, clothes retailers, and tool kit sellers, just to name the most obvious. As those businesses — and others — see demand boom, they then hire employees to handle it. This is how an economy grows.

Some argue that Clinton’s massive spending plan will hurt the economy by increasing Federal deficit spending. I find this argument without merit. Deficit spending, with interest rates barely above zero, is what you want to take advantage of. It is said that the trillions of investor-owned dollars now parked in money market accounts aren’t being invested into the economy because of Federal budget imbalance., I find that assertion¬† misdirected. Investor money remains uninvested, I think, because investors cannot find an investment that offers a reasonable chance of a substantial return. Oil prices are falling, probably for a long time, maybe forever. There’s no big blockbuster drug on offer. Nor is there a significant new technology platform to attract investor billions. Investors are worried about actual deflation, as prices fall (except in some housi9ng markets); in a deflation economy, parked money wins.

Now back to the Clinton proposal and the big question : is it feasible ? That depends on two factors : (1) over what period of time will the $ 550 billion be allocated ? and (2) will the allocations go to the most needed projects or the most politically potent ones ?

The second question raises the issue of waste. Spending hawks love to talk about Federal budget waste. It exists, and that is why we have a General Accounting Office and an inspector General : to monito9r allocations and procurement. Even then, waste exists. Here, the late Ted Kennedy’s axiom applies : “the perfect is the enemy of the good.” Clinton’s plan should not be sidelined because it is likely to occasion some spending waste.

I expect that much of Clinton’s infrastructure allocations will be awarded politically. That’s not necessarily a misapplication. Her support is strongest in the cities, where infrastructure needs loom biggest and injure our economy the most. This is especially true today, as cities become once again the beehives of innovation and its makers that they were 120 years ago during the Industrial Age’s heyday.

Now to the first and more problematic warning : over what period of time will Clinton’s plan be spread ?

If the $ 550 billion is budgeted over a ten year period, it probably will be overtaken by infrastructure disrepair and obsolescence. A decade is a lifetime in today’s fast-moving economy. If our infrastructure cannot be rescued more quickly, alternative transportation platforms, many of them deriving from Uber, Lyft, Bridj and the like, will render most public transportation nugatory. Yet if the Clinton allocation is telescoped to, say, five years, one asks if it c an be done : assessing the needs, soliciting contractor bids, vetting the bids, and beginning the immensely complex process of environmental and traffic review, not to mention zoning, eminent domain, and road or transit closures while work is going on, all suggest that five years won’t get the repairs even one quarter done. Nor is anything this complex done well in a hurry.

Here in Massachusetts, it has taken more than five years to get Green Line expansion in process and looks like it will require another two to three years to complete. The $ 7.6 billion of MBTA and Commuter rail upgrade backlog will take at least as long to complete. Imagine, then, how many years will it take to do Massachusetts’s likely share of the Clinton allocation. Two decades would be my guess; yet as I said above, even one decade might well render her plan moot. As for two decades : by 2035, public transit as we know it will either long since have rendered private transportation innovation price-negative, or it will go the way of the horse and buggy.

Roads and bridges, however, will remain. Maybe that’s where most of the Clinton billions should go, leaving public transit to small increments easily built quickly. I look forward to seeing how — and if — Clinton details her proposal.

—- Mike Freedberg / Here and Sphere

 

 

 

 

 

 

Author: hereandsphere

Here and Sphere is an online journal of news, opinion, reviews, advice, & bits n' pieces of everything else - from HERE to SPHERE...... Co-founded by Michael Freedberg, a long-time Boston Phoenix journalist, and Heather Cornell, a South Coast Massachusetts columnist and editor.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s