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Obama Infrastructure Plan Draws Rare Friends, Foes

Thursday, February 17, 2011

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The ink was scarcely dry on President Obama’s record $3.2 billion proposal to overhaul the nation’s infrastructure, when friends and foes began lining up—and in some unusual ways.

First, three Republican governors spurned their state’s share of the federal funds proposed for high-speed rail. Then labor and business made a joint appearance before Congress to advocate for the bill.

Wisconsin Gov. Scott Walker, Ohio Gov. John Kasich and Florida Gov. Rick Scott all declined the rail packages proposed for their states as economically unsound.

‘A Recipe for Disaster’

“The truth is that this project would be far too costly to taxpayers and I believe the risk far outweighs the benefits,” Scott said in prepared remarks.

“Higher taxes and more government spending is a recipe for disaster.  Government has become addicted to spending beyond its means and we cannot continue this flawed policy.”

“President Obama’s high-speed rail program is not the answer to Florida’s economic recovery.”

Transportation Secretary Ray LaHood expressed disappointment but said the money and rail projects would be welcomed in other states.

Obama proposed the $3.2 billion in funding for 28 transit construction projects as part of his  FY 2012  $129 billion budget for the U.S. Department of Transportation—a 68% increase over the projected spending for the current fiscal year.

‘Targeted Investment’

The $129 billion would be the first installment in a six-year, $556 billion plan that would also include $30 billion in spending on a new National Infrastructure Bank and $53 billion on high-speed and intercity rail.

House Republicans are opposed to high-speed rail and have proposed to cut $1 billion from Obama’s request for the current fiscal year.

LaHood called the DOT budget plan “a targeted investment in America’s economic success.”

“If we’re going to win the future, we have to out-compete the rest of the world by moving people, goods, and information more quickly and reliably than ever before,” LaHood said.  “President Obama’s investments in rebuilding our crumbling roadways and runways, and modernizing our railways and bus systems will help us do just that.”

‘Felix and Oscar’ on the Hill

The infrastructure proposal does have supporters. The plan drew a rare joint appearance and show of support before Congress by AFL-CIO President Richard Trumka and U.S. Chamber of Commerce President Thomas J. Donohue. The two longtime adversaries had earlier released a joint statement in support of additional infrastructure investment.

AFL-CIO President Richard Trumka and U.S. Chamber of Commerce President Thomas J. Donohue

On Wednesday, the two testified before the Senate Committee on Environment and Public Works.

"The fact that Tom Donohue and I appear before you today does not mean that hell has frozen over or that unicorns are roaming the land," Trumka said, to laughter from the panel.

He said that he and Donohue had “agreed to sit down and talk about ways that we can help U.S. manufacturing."

Donohue, who called Trumka and himself “the oddest couple since Felix and Oscar," said infrastructure spending was critical to economic stability and job growth.

"There needs to be a vigorous dialogue on funding and financing, but first we have to agree on the direction in which we're going," Donohue said. "Everyone needs to keep an open mind. ... We've got to avoid cutting off our nose to spite our face."

Senate Support

Senators on the panel were also largely in agreement on the need for investment in national infrastructure, The Washington Post reported.

Oklahoma Sen. James Inhofe, the committee’s ranking Republican, noted that he and Sen. Barbara Boxer (D-CA) were on opposite ends of the ideological spectrum but agreed on the need for infrastructure spending.

Inhofer and other Republicans have criticized Obama for not specifying how his $556 billion proposal would be paid for. They have also accused the administration of shortchanging roads, construction and infrastructure in the stimulus bill.

Vermont Independent Sen. Bernie Sanders was one of several lawmakers who noted that the United States spends 2.4% of its GDP on infrastructure, while China invests 9%.

"We have situations where trains go from Location A to Location B in a slower time than they did 50 years ago," Sanders said. "We're moving backwards, and the Chinese are building dozens of high-speed rails."

Transit Recommendations

The infrastructure spending plan recommends investing $569.3 million in 10 new rail and bus rapid  transit construction projects. An additional 11 projects that were recommended for funding in previous years, but have not yet received federal commitments, are also being recommended for $1.4 billion in this year’s budget.

All the recommendations are part of the FTA’s Annual Report on Funding Recommendations for Fiscal Year 2012, available online here.


Tagged categories: Government; Infrastructure; Public Transit; Railcars

Comment from Michael Kontodiakos, (2/18/2011, 8:01 AM)

It is clear that many other nations, including China, have been investing larger amounts of GDP on infrastructure, while the US seems to be at a standstill. This is a definite setback in economic growth within the US, simply considering all of the technological advances which are being made by many other nations of the world. High-speed railways are a definite advancement into the future, and if the US hesitates on the issue, it will be superseded by others. By the process of building high-speed railways throughout the US, this will spur economic growth within the US, creating jobs for millions of people involved with the process and will lead to reduction in the Trillion Dollar Deficit which is currently affecting the country. Another bright side is that the coatings industry will definitely benefit from this, with the development of advanced coating systems as well as implementation of more stringent requirements of coatings application and inspection!

Comment from Tommy Johnson, (2/18/2011, 8:47 AM)

Michael, investing in America's infrastructure is a good thing, but when you don't have money to spend, you don't keep borrowing it. We need to find the money to pay for it first, not afterward. The states who are also broke and cutting billions in their own budgets can't afford something like this. Anyone knows this is a flawed business plan, and is unsustainable. However, the tiny cuts that have been proposed thus far are nothing in comparison to what needs to be cut to bring the budget in line and pay off our debts.

Comment from Jeffrey Davis, (2/18/2011, 10:25 AM)

Maybe if the United States government stopped throwing money at two pointless wars in Iraq and Afghanistan, we would not have to scrounge for money to invest in our infrastructure! It won't be long until we get finacially involved in the mess in Egypt as well! It's about time we invested in our own country and our own people, instead of constantly getting involved in other countries' problems with American taxpayers' money!

Comment from William Feliciano, (2/18/2011, 2:48 PM)

I'm for the high-speed rail. However, we can't put all our eggs in one infrastructure basket. We must create jobs across a broad transportation spectrum to benefit the USA and the average American. Otherwise, it becomes too "niche" and the prospect is too strong for abuse and waste, like what often happens in military contracts. China spends on high-speed rail, but even more in general infrastructure, I'm sure. They probably spend more on rail b/c they need to --they don't have interstates. Our interstate system, no matter what your opinion is, must be addressed. Slow speed rail, both passenger and freight, cannot be ignored either. Let's care about America.

Comment from Fern Henley, (2/22/2011, 2:05 PM)

When Jefferson wanted the capital built in the South, Hamilton bargained that it would be ok if we could have a system of economy that made it possible to utter credit for projects that had built into them a means of repaying the debt of money printed. Like NASA, or the Grand Coulee, or TVA: All of these projects have paid many times what we were out on them, unlike the money we spent on bailouts of monetarist investment banks’ financial instruments that broke. That said, it seems that Glass-Steagall would provide a firewall to prevent another crisis, as the FCIC hints and the Parsons engineering firm’s plan called North American Water and Power Alliance shelved in the '60s would be not only a high-speed-rail initiative, it would provide business opportunities for the railroad so it would pay for itself. The jobs created by NAWAPA would be over 6 million so we’d have a tax base to pay for education, health, sanitation, etc. Really, if we have a post-industrial nation what’s to be transported on the rails anyway? We need the NAWAPA project to start the demand for production of goods to build such a monumental undertaking. The longer we delay, the older our workers get who have experience in construction, industry and engineering.

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