Many analysts and activists have for years made the case for vastly larger government infrastructure investments via a modernized Works Progress Administration and other means. Too many politicians see things otherwise. The continuing focus on deficits and national debt instead of putting millions of Americans back to work at a time when the lowball official unemployment rate is at 7.2 percent, is so very, very dumb. FT Alphaville writes:
“There are reasonable debates to be had about the necessity (or non-necessity) of making credible commitments to future fiscal consolidation … But that’s different from arguing that tax and spending policies right now should focus on, or even care about, reducing the budget deficit. And there’s a good chance that we’ll look back with regret at the tightening represented in the chart above, which has taken place during a time when interest rates have been scraping the ground.”Modern Monetary Theorists argue that we never have to worry about the national debt. But even more conventional economists point out that the government can borrow to make infrastructure investments at record low interest rates. Or, instead of pumping $85 billion a month into quantitative easing—which is, in part, an ongoing bailout of bankers in an attempt to get them to lend more—we should just spend that trillion dollars a year directly on infrastructure without the middleman. However it's achieved, it should be done.
“It’s also likely that much of the investment that has been forgone in the name of fiscal consolidation will have to be made eventually anyways—only it will be made when rates are higher, exacerbating the long-term fiscal outlook rather than improving it.”
As I wrote Thursday in regards to the sky-high levels of unemployment among American Indians:
Such an infrastructure stimulus with its good jobs is, of course, something that many left-of-center activists have been seeking for a long time. Upgrading railroads, public transit and drinking and wastewater facilties, building rural wi-fi, ultra-high voltage transmission lines, green schools and low-cost housing, renovating the nation's 70,000 substandard bridges and dams, levees and hazardous waste facilities, and modernizing its ports and waterways would create more jobs, long-lasting jobs, than five more rounds of the Federal Reserve's quantitative easing. [...]The smartest thing Rahm Emanuel ever said was "You never let a serious crisis go to waste." But thanks to foot-draggers and obstructionists, that is exactly what continues to happen. Those infrastructure investments that could have been made—could still be made if there was the political will and those foot-draggers and obstructionists were swept away—would provide a modern platform for a prosperous and environmentally sustainable future. While the United States limps along in this regard, other nations, from Germany to China, are well along in building those platforms. Are we ever going to get off the stupid pills?
But, sadly, this is all pie in the sky.
Investing federal dollars in a program of rebuilding, upgrading and innovating infrastructure is something the current gridlock in Washington makes impossible. Which leaves millions of Americans of all colors out of work, or working at poorly paid jobs, whether they live on a reservation in a trailer or in an urban apartment. We can do better. But too few of our leaders seem to want to.