See: Ideology and Investment - NYTimes.com
There’s an obvious policy response to this situation: public investment. We have huge infrastructure needs, especially in water and transportation, and the federal government can borrow incredibly cheaply — in fact, interest rates on inflation-protected bonds have been negative much of the time (they’re currently just 0.4 percent). So borrowing to build roads, repair sewers and more seems like a no-brainer. .I've posted an identical call for (sane and limited) infrastructure spending. We have billions of dollars in deferred maintenance that must be done. Now is the ideal time, with low bond rates and an anemic economy.
I'm not calling for or supporting reckless spendthrift approaches to investment. I don't like waste (high speed rail in California) and I hate the poor spending record of government. But, if there is oversight and we address those project in need, we could help repair a crumbling infrastructure.
If I can agree with Krugman on this, and many of our past leaders from both major parties used low-interest bonds to build American infrastructure, what is the problem with Congress?
I do disagree with Krugman that this is an entirely Republican issue. People have lost faith in government's ability to execute well. The GOP contributed to this lack of faith with their own spending insanity, so I don't trust them to be good stewards of the budget. But, maybe a new national transportation bill would be a good start to demonstrate we can and will repair roads and bridges within sounds budgeting practices. Maybe.