In the past couple of decades, the U.S. infrastructure has been declining steadily, primarily due to lack of investment and poor maintenance, which has had a direct impact on the nation’s economy, and it has hurt American competitiveness in the global economy. The Obama Administration has realized that the infrastructure is in dire need of overhaul, and has made improving the country’s roads one of its top priorities. Back in February, the government announced a $302 billion transportation plan, that was supposed to help rebuild the nation’s infrastructure, but as it turns out, it is not enough to fix all the highways and railroads that are in a pretty poor condition.
On top of this, the Department of Transportation said that the Highway Trust Fund, a transportation fund that was created over six decades ago to help build and maintain the U.S. highway network, is expected to become bankrupt by the end of August, which would put a stop to many construction projects that are currently underway. That’s why the National Economic Council and the President’s Council of Economic Advisers compiled a report called “An Economic Analysis of Transportation Infrastructure Investment”, stressing the importance of a high-quality transportation network and explaining the economic benefits from increased investment in infrastructure. The President himself is trying to convince Congress to continue putting money in the Highway Trust Fund, and will use this report to get support for his transportation plan.
The report states the reasons why America’s infrastructure needs serious investment, highlighting the extremely poor condition the country’s roads, brides and railways are in. It says that 65% of major roadways are rated in less than good condition, 25% of bridges need significant repair, and 45% of Americans don’t have access to public transit. Furthermore, it lists several long-term economic benefits from infrastructure investment, including reduced unemployment rates, improved traffic flow and reduced travel times for businesses and families, as well as higher land values.
In addition to this, the cost of poor infrastructure for the American economy are also included in the report. It says that American families spend more than $120 billion annually in extra fuel, and businesses pay additional $27 billion a year in extra freight transportation costs. Also, another point highlighted in the report that is worth mentioning is the fact that the American economy lags behind the largest economies in the world when it comes to investment in transportation infrastructure, falling to the 18th place in road quality in the World Economic Forum rankings.
According to the report, there are over 4 million miles of road, and 600,000 bridges, and most of them need to be reconstructed, but the U.S. has reduced infrastructure investment drastically over the past 20 years. Now, the government is asking Congress to put an additional $150 billion in the Highway Trust Fund, so that it can continue to finance construction projects over the next four years. Recently, the House added almost $11 billion to the fund, which should help delay its bankruptcy for about 10 months.