By Karl Reiner
Good education and infrastructure systems are major components in maintaining and promoting a nation's economic growth. The role of infrastructure has been particularly ignored in recent years due to the testy Tea Party led standoff in Congress regarding budget priorities and deficit reduction.
The development of infrastructure affects an economy. After the Theodore Roosevelt dam was constructed on the Salt River northeast of Phoenix during 1905-11, the economy of central Arizona rapidly expanded. The $10 million dam project managed by the Federal Reclamation Service controlled floods, stored water and generated electricity. For a time, it was the largest masonry dam structure in the world. The dam remains in service having been renovated and enlarged in 1989-96.
In the decades following the dam's construction, Phoenix outpaced Tucson and became the largest city in the state. Over time, the project's water resources were converted from agricultural to urban use as the area's economy changed gears.
The recession's shock and federal deficit issues have pushed infrastructure to the backburner in Congress. This is happening at the same time many of the nation's roads, water and sewer systems are reaching the end of their planned life cycles. Just to keep things things in working order, the U.S. needs to invest over $2 trillion in renewing the nation's aging infrastructure.
America's roads, bridges, sewage treatment plants, dams and air transportation system are in need of upgrade or repair. It is estimated that 27% of America's 600,000 bridges are structurally deficient or obsolete. The nation's truckers and travellers are plagued by crumbling roads, one-third are in substandard condition. Water supplies and recreational use are at risk in many locations because 4,000 dams have possibility of failure issues. The country's aging sewer systems spill a trillion gallons of untreated sewage into waterways each year.
State and local government funding has been pinched by the recession. They spend 75% of the money going for highway construction and maintenance in the country. Due to the economic downturn, budgets and staffs have been reduced. Much maintenance is done on an emergency basis, the rest deferred. Unfortunately, this procedure is not cost effective. It costs three to four times as much to repair a broken system as to maintain or replace it in an orderly way.
In 2002, the U.S. ranked 5th in worldwide infrastructure rankings. By 2011, it had slipped to 24th place. At the present time, the U.S. spends a little over 2% of its GDP on infrastructure. This compares rather poorly to the 5% spent in Europe and 9% in China.
The 2009 stimulus program produced a one-time increase in federal infrastructure spending of about $100 billion spread over several years. Although it provided a boost, it was not enough to make a large dent in the country's infrastructure problem. President Obama spoke of the need to address the nation's aging infrastructure in his State of the Union address.
Future U.S. economic growth will depend heavily on the political decisions made to restore the nation's infrastructure. Given the current low level of investment, the decline in the overall quality of American infrastructure is expected to continue. In the current tumultuous political environment, it is highly unlikely Congress can come to agreement on a program that will fix the infrastructure systems built decades ago.