A Big Pot of Money
During the 2016 election season, we set out to talk to thoughtful, influential people about a potential surge in infrastructure spending that seems sure to happen once Congress is in session and the new president is sworn in. We wanted to get ideas on the table, to broaden the national conversation beyond the binary more-or-less money paradigm our leaders would like us to be obsessing about.
It is clear that there is a massive funding gap between the amount of revenue currently projected for infrastructure maintenance and the cost of maintaining all that we have built. When we consider the new things we would like to build and the enhancements to existing systems we would like to make, that gap expands to unimaginable levels. There are no serious proposals to eliminate this gap, but there is a lot of momentum to simply pour as much money as possible into the breach.
Is reform needed before more money is spent? Does the urgency of our economy prompt us to spend first, reform as we go? Can new spending drive reform or will it sideline reform? Is reform even needed?
Here's a bit of what we heard.
“We need big, big resources. We need money. We need a big pot of money to get back to being number one in infrastructure.”
The former transportation secretary, now a lobbyist for additional infrastructure spending, advocates an all-of-the-above approach. His concept of a big pot of money is the antithesis of Strong Towns thinking, but -- barring a shift in sentiment -- his ideas seem poised to carry the day in Washington DC this spring.
“I would give [transportation dollars] to cities and towns. I would give it really with not very many strings attached.”
The former mayor of Seattle has long been a friend of the Strong Towns movement. When mayor, his inclination was to support small, incremental improvements that focused on quality of life. This was controversial -- he lost a reelection bid after a contentious vote on a major transportation project -- but, in hindsight, McGinn's vision is truly where the city of Seattle needs to go, especially with the SDOT director stating the city "can't handle any more cars."
If there is to be a big pot of money, it needs to be distributed differently than infrastructure money is being spent today.
“When there are large infusions of money from Washington, it leads to a lot of over consumption of the resource. We saw this with urban renewal in the 1950’s and 60’s. There were actually cities awash in federal money and look at how much damage they did to their communities as a result of that. Self inflicted damage. We certainly don’t want that to happen again.
We need a much more nuanced way of thinking about finance and about capital and about assets. ”
Consistent with the brilliant way Professor Fisher sees the world, much of our conversation with him was nuanced, yet he clearly belongs in the tribe of those that want some significant reform before -- or at least during -- any plan to surge spending on infrastructure.
Perhaps the best quote from the interview:
"If communities really looked at what they could afford and confronted that right at the beginning, I think we would find a very different kind of infrastructure that we’d be putting in place going forward."
Fisher points out that we can spend less and have better outcomes, but will we have the incentives to make those changes if there is simply a big pot of money made available?
“We need to simplify the [transportation funding] process and make it much easier for communities to be involved in the decision-making so that we’re sure we’re responding to the needs and desires of communities.”
One of the most difficult things for advocates like Kate Kraft, executive director of America Walks, is finding the right ally to work with. Federal spending programs overwhelmingly fund projects that make walking and biking more difficult. Yet, those same federal systems are often the only place to fund biking and walking infrastructure at all. While local governments have all the financial incentives to make low risk, high returning biking and walking investments, they often have the worst instincts in that regard and find it difficult to shift money from auto-based infrastructure.
Do you welcome a big pot of federal money or push for a more localized approach? There's no easy answer.
“There are projects that span the nation, [the] interstate highway system being the obvious one. Space travel being another one. If we thought that was an important part of our future, they aren’t really best sourced at the state or local level [but] are best sourced and funded and designed at the federal level.
Most projects aren’t like that. They’re local. They have some overlap, maybe across a couple of states, so a piece of highway or a bridge or a tunnel, maybe might be jointly beneficial to a couple of states or to nearby states or residents of nearby states, but in general, the beneficiaries tend to be the people near the projects themselves and, as a result, it’s not reasonable to think that Congress is going to do that in a way that serves the nation as a whole.”
Russ Roberts is an economist who we tapped to walk us through the case for and against the big-pot-of-money approach. Admittedly skeptical, he helped us understand why some economists consider infrastructure spending a "free lunch" but why he personally believes there is no such thing:
"The idea that something is free, that we can do something with no consequences, is always appealing to the people who want to spend the money or the beneficiaries of it. It seems very unlikely to me, that we’ve discovered a magical way to say, double the size of our economy and that’s simply by spending money."
Question: What do you think of the idea of a big pot of federal money for infrastructure?
(Top photo compliments of Aaron Naparstek.)
Charles Marohn (known as “Chuck” to friends and colleagues) is the founder and president of Strong Towns and the bestselling author of “Escaping the Housing Trap: The Strong Towns Response to the Housing Crisis.” With decades of experience as a land use planner and civil engineer, Marohn is on a mission to help cities and towns become stronger and more prosperous. He spreads the Strong Towns message through in-person presentations, the Strong Towns Podcast, and his books and articles. In recognition of his efforts and impact, Planetizen named him one of the 15 Most Influential Urbanists of all time in 2017 and 2023.