Sunday, June 5, 2011

The Problem with Public Works

I support spending, wisely, to both maintain and upgrade the infrastructure of the United States. There is little room for debate that our infrastructure is dated, crumbling, and often inadequate for the current century. Yet we should be skeptical of politicians suggesting "public works" to rebuild our transportation, power, and facilities will somehow reduce unemployment and lead to a nearly immediate economic boom.

The reality is improving our infrastructure would, at best, keep us even with other nations and would merely prevent further economic decline. Any improvement to our economy would be slight, if quantifiable at all. The reason for this is simple: The American Society of Civil Engineers estimates that as of 2011, deferred maintenance of U.S. infrastructure would cost at least $2.2 trillion to perform.

In other words, for $2.2 trillion we would only maintain current service levels. A few extra cars or trucks might be able to use a road or bridge, but overall the effects of performing deferred maintenance would be no net improvement. Every dime spent to keep an aging bridge or road functioning is a dime not spent on school improvement, libraries, public safety, and so forth.

The comparison would be repairing a house's roof after a storm. The house holds no more people. The functionality of the house was merely maintained, not expanded or improved. Yes, the roofer made money — but that's money the home owner might have spent on a new fuel efficient car, better food, a child's education, or many other things (including frivolous things). Spending to maintain your house simply shifts spending; it does not create new spending.

Maintenance by definition does not expand transportation capacity — it simply restores it to the original intended capacity. Improving the power grid does much the same by redirecting power to where people have migrated without truly improving our energy use patterns. (Again, maintenance is rarely significant improvement.)

If you want to build new public works, or even maintain current public projects, we must address another set of issues. There is a long list of reasons why new works will neither happen quickly nor employ thousands of new workers. In no particular order, some of the issues we face include:
  • Infrastructure work is skilled labor, performed with complex and dangerous machinery. I couldn't operate most of the machinery without significant training; there's a reason skilled operators earn a good wage.
  • Infrastructure work is dangerous. According to the U.S. Bureau of Reclamation, at least 112 men died building Hoover Dam. "Only" eleven men died building the Golden Gate Bridge, according to the California Department of Transportation. Imagine the lawsuits that would result from similar project deaths today. Safety is expensive, and slow.
  • Infrastructure leads to environmental lawsuits. The Sierra Club has delayed the Stillwater Bridge replacement project in Minnesota since 1989 with a series of lawsuits. The bridge has a worse safety rating than the failed Interstate 35 bridge, which collapsed. Lawsuits delay every major infrastructure project, it seems.
You are not going to take an out-of-work clerk, receptionist, computer tech, or teacher and place him or her in a revolving tower crane within six months. I've met qualified machine operators smart enough to know they can't operate tower cranes safely. If you want to learn just how difficult infrastructure work is, read about the NYC Sandhogs, builders of the New York subway and aqueduct systems. These are union construction workers with doctorate degrees because underground construction is that specialized. Do you want just anyone using explosives under urban centers?

The highly trained, well-educated Sandhogs (Local 147 of the Laborer's International Union) suffer a great number of injuries and even deaths on the job — and no group of men and women are more qualified for infrastructure repair and maintenance. Does anyone seriously believe it is possible to put just anyone in these jobs?

People say, "Anyone can patch potholes." That's not true, either. Los Angeles patches potholes with a massive, custom-designed blacktop recycling machine. It is one amazing machine. Only a handful of people are trained to operate the paver. We are no longer living in the 1930s or 40s. Repairs to infrastructure are not a matter of filling holes with gravel. Modern road repair is scientific, with precise mixtures of paving materials. You might not believe that, but you can see (and feel) the difference between a proper repair and a cheap rush job.

As for lawsuits, they won't vanish either. Millions are spent (wasted) defending public projects from environmental lawsuits. California hasn't been able to install solar panels in the Mohave region because of lawsuits. According to "The Mohave Desert Blog" the Sierra Club has stopped yet another project:
The Sierra Club filed a legal challenge against California's approval of the Calico Solar power project, arguing that the California Energy Commission (CEC) rushed the environmental review without full consideration of the impacts on wildlife and without identifying adequate mitigation measures. The need for increased renewable energy generation does not grant solar energy companies a free pass to ravage pristine desert habitat under the false claim of "clean energy." There is plenty of solar potential on already-disturbed land and rooftops that can be tapped so we can save our desert ecosystems for future generations to enjoy.
Does anyone really believe the environmental movement is going to suddenly support alternative energy projects? They've fought all major hydroelectric, nuclear, and solar projects. What will they support? Wind power? There have been lawsuits concerning the risks to various bird species, including the California Condor. Birds tend to fly into (get sucked into?) giant wind turbines.

Politicians should be honest with American voters. We have to spend on infrastructure — and because we haven't spent for the necessary maintenance, any surge in spending will not lead to immediate, magical economic gains. We have to repair our public works, definitely, but it might actually require tax increases and revenue "reallocations" that could stall or inhibit economic growth. Yes, fixing the mess we've allowed to fester could actually slow the economy. It's hard to explain, but in the 1990s Japan spent a record amount on infrastructure and their economy stalled.

For a good analysis of Japan's infrastructure spending see: Japan's Big-Works Stimulus Is Lesson. As recently as 2009, the New York Times admitted the Japanese investments didn't help Japan's economy as intended.
Moreover, it matters what gets built: Japan spent too much on increasingly wasteful roads and bridges, and not enough in areas like education and social services, which studies show deliver more bang for the buck than infrastructure spending.
"It is not enough just to hire workers to dig holes and then fill them in again," said Toshihiro Ihori, an economics professor at the University of Tokyo. "One lesson from Japan is that public works get the best results when they create something useful for the future."
What bothers me is that we won't repair infrastructure because maintenance is not politically easy to sell. Shiny new projects are popular and easier to explain than dull, expensive repair work to our roads and bridges. Let's hope American politicians start being honest about infrastructure: we need it, but it isn't going to cure our current economic problems. Government does what is necessary, but often it does far more than is needed. Waste is not productive.

Politicians seldom make wise economic choices. Proof of that is the rush to build new high speed rail systems while ignoring the $2.2 trillion we should be spending on existing infrastructure. The argument "We can do both!" is simply absurd. We don't have $2.2 trillion for maintenance — so we're going to spend $1 trillion on rail projects? I can already foresee the next problem: rail lines without proper maintenance. We'll build it and neglect it.

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