President Obama held a meeting on the economic impact of infrastructure investment on our states and local communities at the White House and renewed his call for infrastructure spending
President Obama held a meeting on the economic impact of infrastructure investment on our states and local communities at the White House and renewed his call for infrastructure spending.
Joining the president at the meeting were Treasury Secretary Tim Geithner, Secretary of Transportation Ray LaHood, former Secretaries of Transportation Norman Mineta and Samuel Skinner, Governors Ed Rendell and Jack Markell, and Mayors Antonio Villaraigosa, Mick Cornett, Julian Castro, Michael Coleman, Michael Nutter, Stephanie Rawlings-Blake, Kasim Reed and Joe Riley. The group discussed the current state of our transportation infrastructure in cities and states across the country, the challenges they face to improving their infrastructure, and the short- and long-term economic impact of new infrastructure investment.
The group discussed a new report on infrastructure investment from the Department of the Treasury with the Council of Economic Advisers. The report discusses the positive economic impact infrastructure investment achieves by raising our nationís economic output, enhancing Americaís global economic competitiveness and creating good jobs for the middle class. Specifically, the report finds that 80% of the jobs directly created by investing in transportation infrastructure would be in the construction, manufacturing and retail trade sectors. The report also finds that infrastructure investments have high bang for the buck because construction costs are low due to underutilized resources, and these investments would create jobs in sectors of the economy suffering from some of the highest levels of unemployment.
ìWe need a new plan for Americaís roads, rails and runways for the long-term," Obama said. "Over the next six years, we will rebuild 150,000 miles of our roads--enough to circle the world six times. We will lay and maintain 4,000 miles of our railways--enough to stretch coast-to-coast. And we will restore 150 miles of runways and advance a next generation air-traffic control system that reduces delays for the American people. By making these investments across the country, we wonít just make our economy run better over the long haul--weíll create good, middle-class jobs right now.î
ìInvesting in our transportation infrastructure in the near term will pay dividends for our economy both now and in the future,î said Geithner. ìModernizing our roads, rails and airports will create middle class jobs, help increase America's productivity and expand our exports.î
"Today, we heard first hand from a group of mayors and governors about the current state of our transportation infrastructure in cities and states across the country, the challenges they face to improving their infrastructure, and the short- and long-term economic impact of new infrastructure investment," said Transportation Secretary Ray LaHood. "We know that upgrading our nationís infrastructure is vital to our economy and our future competitiveness. And that's why the president has laid out a bold new plan for rebuilding and modernizing America's transportation infrastructure that will bring jobs to our economy now and increase our nation's growth and productivity over the long-term."
Industry trade groups were understandably pleased by the administration's announcement.
"The Council of Economic Advisors' report got it right in extolling the long-term U.S. economic benefits from increased transportation infrastructure investments," said National Stone, Sand & Gravel Association Chairman Bill Schneider, who is president and CEO of Knife River Corp. "A combination of availability of building materials, low interest rates for borrowing, and high levels of private sector unemployment in the construction sector made this the ideal time to repair and build roads, bridges and airports."
The administration is working on a six-year plan that builds on the up-front $50 billion investment. The president said his plan would rebuild 150,000 miles of roads, restore 150 miles of runways, and lay and maintain 4,000 miles of railways. The president called for a smart electric grid, collapsing 100 current transportation programs, providing sustainable communities and creating a national infrastructure bank. The president said his transportation infrastructure plan would be fully paid for, but did not elaborate further on funding sources.
ìWe commend the president for his continued focus on transportation infrastructure investment to create jobs and sustain economic growth," said American Road & Transportation Builders Association President and CEO Pete Ruane. ìWe have under-invested in our infrastructure for too long, and it is now time to match those investments being made by our global economic competitors."
ìPresident Obama stated that this investment must be part of a robust, multi-year surface transportation authorization bill, the passage of which is now one year overdue. ARTBA members are ready to work aggressively alongside the president and Congress to passóas soon as possibleóthe highway/transit bill.î
AASHTO Executive Director John Horsley also called for bipartisan support to bring about a fundamental overhaul of the country's woefully inefficient federal surface transportation systems.
"We are pleased that the president wants to press for a front-end loaded $50 billion investment in the lame duck session," said Horsley. "The analysis we've done shows the stimulus spending made possible through the American Recovery and Reinvestment Act will be wrapping up next year. Unless there is an initiative like the president's to continue investment in transportation, you will see 300,000 construction related jobs lost by the end of next year.
"We also agree with the economic analysis that shows investing in transportation now is a good deal for taxpayers. Many of the economic recovery projects built by state DOTs over the past two years have received bids on average 30% below the engineers' estimates."