Donald Trump America’s failing infrastructure A quick look at how infrastructure financing works show that the current predicament wont be a quick fix, even as president promises big investment
Donald Trump America’s failing Infrastructure is finally in. Washingtons politicians may struggle through the capitals terrible traffic to an inbox of complaints about crumbling roads, dams, airports from their constituents, but the political will to do anything has been bogged down by arguments about how to pay for it. Until now, potentially.
Donald Trump campaigned on a pledge to rebuild Americas failing backbone and he doubled down on that pledge last week. This week hell be offered another chance to push for investment when the American Society of Civil Engineers (ASCE) release its latest report on the state of Americas infrastructure. Its expected to be bad.
Trump seems to have a genuine passion for rebuilding America. Crumbling infrastructure will be replaced with new roads, bridges, tunnels, airports and railways gleaming across our beautiful land, Trump said in his speech before Congress last Tuesday as he renewed a campaign promise, vowing to ask Congress for a $1tn infrastructure investment package financed through public and private capital.
Whether he will get to fulfill his promise remains to be seen.
Perhaps nowhere is the plight of US infrastructure and the issues with fixing them more obvious than on its roads. ASCE calculates that 32% of Americas roads are in poor or mediocre condition and 25% of its bridges are structurally deficient or obsolete. Bad roads and bridges will cost each American family $3,400 per year through 2025 unless something is done to improve their condition, according to the ASCEs 2016 Failure to Act report.
Those potholes, cracks and poor surfaces add up to a $4.3tn investment deficit, according to the ASCE. It calculates that by 2025, failing roads will cost the American economy more than $2.2tn in lost business sales.
Fixing the situation is not going to be a simple task, as is amply demonstrated by a quick look at how infrastructure financing landed in its current predicament.
Stuck in political gridlock over the last six years Congress has passed 33 short-term measures rather than funding transportation for the long term.
State highway departments rely upon different revenue sources for funding, but a quarter of it is supposed to come from the federal Highway Trust Fund (HTF), which in turn receives its money from a federal fuel excise tax. The HTF was established by federal law in 1956, at a time when highway funding was coming out of the governments general fund. That fund will expire in July with no replacement currently in place.
Federal gasoline and diesel tax rates which now stand at 18.4 cents and 24.4 cents per gallon, respectively have not been raised since 1993. Since the beginning of the Great Recession in 2008, spending has outstripped the amount of money coming into the HTF. According to a report the Congressional Budget Office released last year, lawmakers have transferred about $143bn from other sources to maintain a positive balance in the trust fund. Second, adjusted for changes in construction costs, total federal spending on highways buys less now than at any time since the early 1990s.
Rocky Moretti, the policy director of Trip, a transportation research organization headquartered in Washington DC, said that post-recession economic recovery has brought increased vehicle travel, placing additional strain on roads urban ones in particular. But a recent report by the Texas A&M Transportation Institute analyzing transportation in 471 urban areas showed that although vehicle miles had increased, fuel consumption had not risen above its pre-recession level by 2014, meaning fewer dollars had flowed into highway coffers.