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Wanted: Infrastructure funding

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President Obama Announced a Plan to Renew and Expand America’s Roads, Railways and Runways: Infrastructure investments one key way to continue recovery and keep our economy growing

By Jeff Berman, Group News Editor
September 09, 2010

At a Labor Day rally in Milwaukee, President Barack Obama heralded the White House’s ambitious six-year, $50 billion plan to expand and upgrade U.S. roads, railways, and runways, which, he said, can enable the country to have the “best infrastructure in the world.”

As LM reported, Obama’s plan is comprised of:
-rebuilding 150,000 miles of roads;
-constructing and maintaining 4,000 miles of rail, which is enough to stretch from coast-to-coast; and
-rehabilitate or reconstruct 150 miles of runways along with installing a NextGen system that will reduce travel time and delays.

Make no mistake, at a time when the economy continues to largely stumble, with the occasional snippet of good news mixed in from time to time, more needs to be done to get more people back to work, augment consumer confidence, drive demand and get America back to being the world’s top economic power.

And honing in on transportation infrastructure as a way to get our economic engine truly rolling again seems like a good plan. But as we all know, an ambitious effort such as the one proposed by Obama remains on a “road to nowhere” (thanks, David Byrne) without meaningful funding.

As I have mentioned before, this is where ambition and desire tends to fade and reality sets in. Look no further than the gas tax, the primary funding mechanism for the now-expired SAFETEA-LU reauthorization—which is solvent for the remainder of 2010. What happens after that is anyone’s guess. President Obama has said on more than one occasion that raising the gas tax to increase transportation funding is a non-starter. In this political climate, he knows he has no choice really, which is incredibly unfortunate as it would ostensibly be the most direct and easy way to continue funding transportation infrastructure projects. But, alas, things are often never as easy as they seem.

What’s more, it is apparent that Obama’s proposal is not going to make major inroads with the mid-term elections around the corner.
This was made clear in a Washington Post article published yesterday:

“The calendar is not our friend here, and the Republicans in the Senate aren’t going to let him have a win before the election,” said a staff member on a key transportation committee, who spoke on the condition of anonymity because he was not authorized to speak on the issue. “We really can’t expect any progress this year.”

Hardly surprising, eh? Nor is the article’s reference to data from the U.S. Chamber of Commerce about the gas tax:

“The gas tax has been the primary source of revenue for the federal Highway Trust Fund. Since 1993, the federal government has collected 18.4 cents per gallon, but more fuel-efficient vehicles have contributed to a steep decline in the fund. Five years ago, the U.S. Chamber of Commerce said it was falling about $45 billion short of the estimated $222 billion a year needed to maintain the surface transportation system.”

And the beat goes on. What is the best solution for transportation infrastructure funding? There are some great ideas out there from the President and countless others, but all roads point to a dead end without an effective source of funding.

What do you think? Newsroom Notes wants to know.

About the Author

Jeff Berman headshot
Jeff Berman
Group News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. .(JavaScript must be enabled to view this email address).


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