Most experts say U.S. needs more infrastructure investment; one says not so much
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Four years into what the Biden administration has dubbed the “infrastructure decade,” and as most experts say the government needs to ramp up investment to fix the nation’s aging roads, bridges and water systems, one academic floats a contrarian view.
“America creates and maintains too much infrastructure,” wrote Judge Glock, director of research and a senior fellow at the Manhattan Institute, in a
“We do not need new public infrastructure commensurate with the level of current public spending,” Glock argues. “New capital spending provided by the federal government is funding the lowest valued projects with the most additional requirements. Maintenance support by the federal government is even less plausibly related to core federal functions and only serves to increase normal maintenance costs and support failing projects.”
Manhattan Institute
The paper is a first in a new series on infrastructure from the Manhattan Institute, Glock told The Bond Buyer. The series includes an upcoming talk by former New York State Thruway Authority chair Howard Milstein, who led the design-build procurement of the Tappan Zee Bridge replacement, on how other authorities can use that as a model.
“We are sympathetic to a lot of supply-side movement and wanted to do some pieces on how infrastructure could be improved and what are the issues holding it back,” Glock said.
Unlike in 2020, infrastructure — which traditionally enjoys support from both parties — is not getting much showtime in the presidential election between Vice President Kamala Harris and former President Donald Trump, Glock noted.
“After the Bipartisan Infrastructure Law people understand there’s not a lot of public demand or need for a massive new spending project,” Glock said. “It’s interesting how the conversation has just disappeared in this presidential election.”
“Core” federal infrastructure spending on transportation and water has been mostly stable at around 2.5% of GDP for the past 60 years, which means that real spending has been rising steadily over the same period, Glock wrote in the paper. “It’s not obvious that real spending on century-old infrastructure should be a stable part of GDP and should be increasing in real terms,” he said.
It’s not that the U.S. doesn’t need new infrastructure like housing, pipes, roads and electric transmission, Glock said. It’s that the federal dollars are going to older systems, like trains, highways and water systems, with long-term diminishing returns, he said. “The other reason for declining returns is that infrastructure projects are increasingly selected for reasons unrelated to citizen needs, which means more ‘roads to nowhere,’ unused transit projects, and transmission lines that are not reducing electricity prices,” he wrote.
President Joe Biden’s Infrastructure Investment and Jobs Act in 2021 “is a culmination of the recent trajectory of low-returns, worse projects, and increased mandates,” Glock wrote.
Transit, water, broadband and electric vehicle chargers all exemplify inefficient federal investment, he said. Transit, which carries less than 2% of U.S. passenger miles, got almost $40 billion, or about a fourth of combined personal passenger spending, in the IIJA, Glock said in the paper.
Water projects are “one of the poorest argument for infrastructure spending,” Glock said. “It’s not that we don’t need new pipes or regular maintenance. But federal investment is “bringing in some of the lowest returns out there,” he said, adding it has “not saved Americans from more expensive water or led to substantially more consumable water.”
“We’re responding to very low threats of water damage to health with incredibly expensive infrastructure mandates that are then being built out by the cities,” he said.
Billions of dollars allocated to broadband and EV chargers programs in the IIJA are
The IIJA provided $65 billion for expanded broadband, but in fact 96% of the U.S. population already has access to a broadband network, provided by the private sector, Glock said.
Glock’s criticism is aimed at federal infrastructure investment, and he generally encourages more financing from state and local governments and the private sector.
“Ending most federal support, funding more projects at the state and local level, and opening more options for the private sector, would both raise returns and reduce the political problems that have made U.S. infrastructure famously wasteful,” he wrote in the paper.
