- Tom Silva
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National Infrastructure Bank Could Finance Rebuilding America
As the nation’s roads, railways and sewers crumble, President Barack Obama’s proposal to create a $50 billion infrastructure bank is one way to build on the American Recovery and Reinvestment Act (ARRA). According to Margaret Donahoe, Executive Director of the Minnesota Transportation Alliance, “A new multi-year transportation authorization act is almost one year overdue and the administration acknowledges the need to work with Congress to pass a new program.”
President Obama’s goal is to invest $50 billion to rebuild 150,000 miles of road; lay and maintain 4,000 miles of new railroad track; reconstruct 150 miles of airport runways; and create an air-traffic control system that meets 21st-century standards. The $50 billion will be offset by eliminating tax breaks and subsidies for the gas and oil industry. “The new proposal couples a boost in funding with new policies that begin to change the way transportation has been funded in the past,” Donahoe says. “The plan includes the establishment of an Infrastructure Bank to leverage federal dollars with other sources of revenue, including private capital. Outside investors would need a return on investment, so many of the projects would likely involve increased fees, taxes or tolls.” The proposal has the potential to create construction jobs and refurbish the nation’s deteriorating infrastructure.
“Rebuilding our third-rate transportation infrastructure will also help us catch up with established competitors such as Germany and new players such as China, Brazil and India,” according to Donahoe. “Those nations are investing in their economies and their future competitiveness by putting money into modern highways, ports, freight rail and other infrastructure. Our country clearly needs to improve our infrastructure to provide the service level American businesses need. There is little disagreement on the benefit of putting skilled people to work immediately while building the infrastructure our economy needs.”
The good news for President Obama is that the infrastructure bank enjoys significant support from legislators in both the House and Senate. Additional support comes from workers, firms, and organizations involved in transportation, communication, and construction.