Home » Manufacturers' Group Charts Benefits of Infrastructure Funding Hike
A new study from the National Association of Manufacturers says that a long-term hike in infrastructure spending could give a boost to the U.S. economy, and increase jobs and workers’ take-home pay.
The report, released on Sept. 23, says that a targeted, large spending boost—about $83 billion a year in 2009 dollars—over 15 years could push U.S. Gross Domestic Product up 1.3% by 2020 and by 2.9% 10 years later.
The study, titled "Catching Up," also forecasts that such an infusion would raise household after-tax pay by $1,300 by 2020 and $4,400 by 2030.
There have been many private-sector and federal government studies over the years outlining the magnitude of U.S. infrastructure needs, both overall and in particular sectors, such as highways and wastewater treatment.
NAM President Jay Timmons told reporters on a conference call, “We get a lot of agreement that something needs to be done.”
He added, “What this report seeks to do is to quantify the need, but more importantly, to talk about the economic benefits that can arise if the appropriate actions are taken.”
Beth McGinn, an American Road & Transportation Builders Association spokesperson, says that having NAM weigh in on the infrastructure issue is valuable. “They bring that business perspective, that voice, to it,” she notes.
McGinn says that the report “just shows again that the inability to deal with the inefficiencies in our transportation network can have an effect throughout the system and on our economy.”
The NAM study makes no specific recommendations on how to raise the tens of billions of dollars per year it says are required to reach the funding goal.
Timmons said, “From our standpoint, we don’t actually think any potential funding source should be off the table.”
Congress has been unable to pass a multi-year surface transportation bill this year, instead approving an $10.8-billion “patch” to reauthorize highway and transit programs and keep the faltering Highway Trust Fund in the black just through May 2015.
Congress did strike a deal that led to enactment in June of the $12.3-billion Water Resources Reform and Development Act. It’s the first major bill since 2007 to authorize funds for Army Corps of Engineers civil-works projects.
But those $12 billion in authorizations have yet to be turned into actual appropriations.
Congress has taken a stopgap approach to fiscal 2015 appropriations, approving a continuing resolution that keeps the Corps and other federal agencies operating from Oct. 1 only until Dec. 11—and at slightly below their 2014 funding levels.
Timmons said, “We simply can’t continue to lurch along with temporary Band-Aids, if you will, on a number of issues,” including infrastructure.
Looking at recent history, the NAM study says that inflation-adjusted spending on U.S. public infrastructure dropped 10.5%, to $379.2 billion in 2012, from $423.9 billion in 2003.
The average annual decline in that period was 1.2%.
Highways and streets, which account for 23% of all infrastructure spending, posted the largest decline, falling 2.4%.
A joint venture of Skanska, Corman Kokosing Construction Co. and McLean Contracting Co. is moving toward an early 2020 construction start for a $463-million replacement for a 79-year-old bridge across the Potomac River, south of Washington, D.C.