Sunday, March 12, 2017

The ASCE's Infrastructure Report Card falls short in its recommendations by not promoting New Deal-style programs and by not promoting increased taxes on the super-wealthy

Above: A WPA worker scrapes out a runway for the new airport in Morgantown, West Virginia, 1936. The WPA built or repaired hundreds of airports across the country. These airports helped the development of American aviation, helped the war effort, and helped the economy boom after the war. Many (and probably most) are still in use today. The 2017 Infrastructure Report Card, issued by the American Society of Civil Engineers (ASCE), gives our airports a "D" letter grade, but makes no mention of utilizing the labor and skills of America's un- and under-employed population, now at 19 million. Photo courtesy of the National Archives.

The ASCE's anemic, and often regressive-based solutions detract from its otherwise excellent Infrastructure Report Card

The American Society of Civil Engineers (ASCE) does a fantastic job of evaluating and reporting on the condition of America's infrastructure in its latest Infrastructure Report Card (America received a "D+" again). It's recommendations, however, fall short. For example, it correctly recommends increased federal funding; it less-correctly recommends increased state funding (states have a tendency to implement regressive revenue systems); and it wrongly emphasizes private sector involvement and regressive taxes and fees. With respect to the latter, tens of millions of Americans are already strained to the limit - with over half in such poor financial shape that they can't even handle a $500 emergency (in the ASCE's wastewater section, at least, they do mention "bill payment assistance"). 

Many of the ASCE's recommended solutions are likely to hit lower-income Americans the hardest. For example, private funds for highways will result in toll roads, or perhaps even user fees--which are regressive forms of revenue collection. Increased utility rates for drinking water are also regressive. A recent study indicated that water rates have been rising steadily these past many years, "increasingly leaving many Americans struggling to pay for their water service" ("Water Could Soon Be Unaffordable For Millions Of Americans: Water bills are on the rise nationwide. And poor communities are being hit the hardest." Huffington Post, January 31, 2017). 

The ASCE also recommends an increase in fuel taxes. And while some argue that fuel taxes are not regressive (because, for example, wealthy people often drive gas-guzzling SUVs and sports cars - and thus pay more), we know that, all things being equal, fuel taxes are indeed regressive. For example, if Bill Gates and I visit a gas station, and we each pump 10 gallons of gas into our Honda Civics, a higher percentage of my income will be taken to satisfy the tax. Further, the increased fuel taxes I pay are subtracted from my necessities, i.e., money that I would otherwise put towards food, clothing, shelter, retirement, etc., while the increased fuel taxes Bill Gates would pay would be so inconsequential that it would not even significantly subtract from his luxury.

No mention of higher taxes on the wealthy. No mention of a new CCC or WPA. Why not?

Here is where the ASCE's report card really falls short: Nowhere in its recommended solutions, for each of its 16 categories (roads, dams, drinking water, etc.), can I find anything that proposes higher taxes on the wealthy, or a New Deal-style infrastructure program. To be fair, it does not rule them out, and you can possibly extrapolate such outcomes from the ASCE's recommendations, but the failure to specifically mention them is a major shortcoming. 

With respect to taxes, the richest 400 Americans are worth a record $2.4 trillion, which is, by the way, more than the $2 trillion, 10-year infrastructure funding gap that currently exists. The Walmart heirs alone have more wealth than the bottom 40% of the American population. Given these obscene realities, it makes no sense whatsoever to not specifically say, "Raise taxes on the wealthiest Americans to help fund infrastructure." In 2014, Republican political strategist Matthew Dowd wrote

"My humble suggestion is that we need to have a well-paying jobs program tied to infrastructure improvements administered locally by cities, counties and states where people still trust government to get the job done. And this should be funded by tax policies at the federal level which put a much bigger burden on the wealthy in this country." 

The ASCE's recommended solutions are littered with utility rate increases, user fees, motor fuel tax increases, privatization, public-private partnerships, etc., but not a single mention of "higher taxes on the super-wealthy." Indeed, the omission is so glaring that I suspect that they didn't want to offend their wealthy members and donors, by suggesting that they needed to be taxed more. True, the ASCE frequently mentions the need for increased appropriations, but without more details, e.g., higher taxes on billionaires? increased borrowing? cuts to the defense budget? we're left guessing.

With respect to New Deal-type solutions, it's interesting to read the ASCE's recommendations for the multi-billion dollar maintenance backlog that exists in our public parks. The ASCE recommends user fees (another regressive revenue system), increased appropriations, improved partnerships with private groups, etc. But there is no mention of a new Civilian Conservation Corps (CCC), despite the fact the CCC is largely responsible for the creation and/or improvement of our state & federal parks and forests. The work that the CCC did in our parks and forests was so massive, and so beneficial, and so long-lasting (tens of millions of Americans still benefit from that work today), that its absence as a recommendation is really disappointing.

The same is true for the failure of the ASCE to mention the possibility of a new WPA. Between 1935 and 1943 the WPA was a main factor in the build-up and modernization of our nation's infrastructure - 16,000  miles of new water lines installed, 124,000 bridge projects, 650,000 miles of roadwork, to highlight just a few of its accomplishments. So, why is there no mention of a new WPA today? In my opinion, the mythology of the unemployed as "lazy" and "worthless" is so ingrained in our culture (thanks to decades of hateful right-wing rhetoric) that the idea of hiring them to improve our infrastructure--even though we've done it in the past to great success--is not even considered a possibility. Isn't that an amazing cultural phenomenon? Isn't that an amazing spectacle of cultural forgetfulness and self-delusion? 

It's painfully clear that very few people or organizations understand the magnitude, and lasting impact, of the New Deal's infrastructure work. And that's a big problem.

Americans today, and quite possibly the ASCE too, do not fully comprehend the amount of infrastructure work that was performed during the New Deal, nor do they fully comprehend the lasting value of that work (a value that is proven by the many thousands of those projects that we still use today - see, e.g., the infrastructure projects mapped by the Living New Deal). And this failure of comprehension does not bode well for our infrastructure, nor for our middle-class and poor citizens who will be nickel-and-dimed everywhere they turn with an array taxes, tolls, fees, fines, and utility rate increases. Worse still, this attempt to fix our crumbling infrastructure with regressive revenue systems will ultimately fail because tens of millions of Americans won't be able to withstand the financial beating. You can only squeeze a sponge so many times before water stops dripping out.

In sum, the ASCE's report card is a phenomenal resource to use in evaluating our infrastructure. Its recommendations, however, are too timid, too focused on regressive funding mechanisms, and too reverential towards private sector involvement. And failing to highlight the New Deal--the largest work & construction program in human history--is an oversight, to say the least.


  1. If anything Brent, the Constitutional principle of the government to issue credit is the key principle to look at when looking at the scope of what is needed. After all, it's FDR's return to Hamiltonian methods in dealing with the problem of collapse in revenue and employment, as much as the making the rich pay once Glass Steagall had castrated the predatory nature of Wall St. One can look to the Chinese and the multi billion investment in basic economic infrastructure adopted from the past success of the USA (which we've ironically abandoned) that has, like FDR did, uplift millions out of wretched poverty into middle class status with the added benefit that they've gone and started to help other nations along that same path that have been victims for centuries of colonialism and globalization. Legislation for reintroducing Glass Steagall has been put forward again by congresswoman Marcy Kaptur (D-OH) and oddly, Trump is for it although his Treasury secretary seems to be a George Soros colaborator and bent on screwing things up. It's a good start at least.

    1. Good points. I definitely think a multi-pronged approach is needed, including credit and lending, some private sector involvement, and perhaps even some carefully-focused user fee arrangements. But I thought the Infrastructure Report Card focused a little too much on these things, while altogether ignoring the role work-relief (like a new CCC in our national parks) and higher taxes on the super-wealthy could play.

    2. There's two scenarios I can think of. One is that the ASCE has been infiltrated by some free market think tanks, or two, that cynicism and pessimism has made them resort to dumbing it down in order to sell it to the idiots in Washington.