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Obama Again Calls for Infrastructure Spending

Whether the White House can actually move this from pipe dream into existence is questionable, but this is precisely what they should be doing, some would say what they should have been doing for two years:

President Obama will join mayors, governors and current and former transportation secretaries on Monday to argue for a major initiative to repair and modernize the nation’s roads, rails and air systems, just weeks before an election that is all but certain to expand the size of his Republican opposition in Congress.

A new report from economists at the Treasury and Mr. Obama’s Council of Economic Advisers concludes that this is the “optimal time” to invest in public infrastructure because of high unemployment and lower prices in the construction industry, which has been hit harder than any other sector by the puncturing of the bubble in housing and commercial real estate.

That report is here, and it basically repeats the obvious: infrastructure spending is a bargain right now because of low borrowing costs and low labor costs, it would generate a lot of economic activity in sectors that have a lot of excess capacity at the moment, like construction and manufacturing, and it would leave a lasting legacy that would increase productivity and growth for decades. To say nothing of the fact that repairing broken infrastructure in the event of a catastrophe would cost inordinately more than getting it done before something bad occurs.

The President did hold that presser today, and he repeated that too.

It’s true that the stimulus didn’t go far enough on infrastructure, and that this $50 billion dollar front-loaded investment and infrastructure bank should be spread beyond transportation and into a host of different areas (I believe the infrastructure bank would do so, but not the surface transportation investment). But they’re onto this no-brainer policy now, and it demands support.

CommunityThe Bullpen

Obama Again Calls for Infrastructure Spending

Whether the White House can actually move this from pipe dream into existence is questionable, but this is precisely what they should be doing, some would say what they should have been doing for two years:

President Obama will join mayors, governors and current and former transportation secretaries on Monday to argue for a major initiative to repair and modernize the nation’s roads, rails and air systems, just weeks before an election that is all but certain to expand the size of his Republican opposition in Congress.

A new report from economists at the Treasury and Mr. Obama’s Council of Economic Advisers concludes that this is the “optimal time” to invest in public infrastructure because of high unemployment and lower prices in the construction industry, which has been hit harder than any other sector by the puncturing of the bubble in housing and commercial real estate.

That report is here, and it basically repeats the obvious: infrastructure spending is a bargain right now because of low borrowing costs and low labor costs, it would generate a lot of economic activity in sectors that have a lot of excess capacity at the moment, like construction and manufacturing, and it would leave a lasting legacy that would increase productivity and growth for decades. To say nothing of the fact that repairing broken infrastructure in the event of a catastrophe would cost inordinately more than getting it done before something bad occurs.

The President did hold that presser today, and he repeated that too.

It’s true that the stimulus didn’t go far enough on infrastructure, and that this $50 billion dollar front-loaded investment and infrastructure bank should be spread beyond transportation and into a host of different areas (I believe the infrastructure bank would do so, but not the surface transportation investment). But they’re onto this no-brainer policy now, and it demands support.

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David Dayen

David Dayen