Comments on: Not So Fast…Rethinking Infrastructure and the Stimulus http://washingtonindependent.com/26807/not-so-fastrethinking-infrastructure-and-the-stimulus National News in Context Tue, 31 Jan 2012 02:40:51 +0000 hourly 1 http://wordpress.org/?v=3.2.1 By: Sam_Holloway http://washingtonindependent.com/26807/not-so-fastrethinking-infrastructure-and-the-stimulus/comment-page-1#comment-37216 Sam_Holloway Sat, 24 Jan 2009 23:35:16 +0000 http://washingtonindependent.com/?p=26807#comment-37216 So if I'm reading this correctly, interest groups with the ability to sell themselves effectively are trying to get their paws on stimulus funds by claiming to support infrastructure improvements. In reality, though, they'll be better at lining their own pockets than they will be at giving us lasting value for our money.<br><br>Why do I get the impression that their ability to lobby is going to trump our long-term (and even short-term) needs? Thanks for shining a spotlight on this. Good show. So if I'm reading this correctly, interest groups with the ability to sell themselves effectively are trying to get their paws on stimulus funds by claiming to support infrastructure improvements. In reality, though, they'll be better at lining their own pockets than they will be at giving us lasting value for our money.

Why do I get the impression that their ability to lobby is going to trump our long-term (and even short-term) needs? Thanks for shining a spotlight on this. Good show.

]]> By: Sam_Holloway http://washingtonindependent.com/26807/not-so-fastrethinking-infrastructure-and-the-stimulus/comment-page-1#comment-16153 Sam_Holloway Sat, 24 Jan 2009 15:35:16 +0000 http://washingtonindependent.com/?p=26807#comment-16153 So if I'm reading this correctly, interest groups with the ability to sell themselves effectively are trying to get their paws on stimulus funds by claiming to support infrastructure improvements. In reality, though, they'll be better at lining their own pockets than they will be at giving us lasting value for our money.<br><br>Why do I get the impression that their ability to lobby is going to trump our long-term (and even short-term) needs? Thanks for shining a spotlight on this. Good show. So if I'm reading this correctly, interest groups with the ability to sell themselves effectively are trying to get their paws on stimulus funds by claiming to support infrastructure improvements. In reality, though, they'll be better at lining their own pockets than they will be at giving us lasting value for our money.

Why do I get the impression that their ability to lobby is going to trump our long-term (and even short-term) needs? Thanks for shining a spotlight on this. Good show.

]]> By: Alon Levy http://washingtonindependent.com/26807/not-so-fastrethinking-infrastructure-and-the-stimulus/comment-page-1#comment-16124 Alon Levy Sat, 24 Jan 2009 05:08:17 +0000 http://washingtonindependent.com/?p=26807#comment-16124 Krugman actually just mentioned more mass transit funding. He hasn't talked about any cash benefit like unemployment insurance or more money for Medicaid. Medicaid will fall under health care reform, which Obama has indicated he'll pursue soon. Unemployment insurance is essentially a cash benefit, like a targeted tax cut; it's good from the point of view of helping the poor, but not from this of stimulating the economy. Krugman actually just mentioned more mass transit funding. He hasn't talked about any cash benefit like unemployment insurance or more money for Medicaid. Medicaid will fall under health care reform, which Obama has indicated he'll pursue soon. Unemployment insurance is essentially a cash benefit, like a targeted tax cut; it's good from the point of view of helping the poor, but not from this of stimulating the economy.

]]> By: Clive Jones http://washingtonindependent.com/26807/not-so-fastrethinking-infrastructure-and-the-stimulus/comment-page-1#comment-16121 Clive Jones Sat, 24 Jan 2009 03:37:35 +0000 http://washingtonindependent.com/?p=26807#comment-16121 The orthodox view probably is that public works are slow to start, often getting in motion after the recovery starts, and contributing more to inflation than job recovery per se. However, this recession looks like it will be longer than average. Housing prices are projected to continue their descent into 2010 and possibly 2011. Drops in housing prices will cause more foreclosures and further problems for the financial industry. In this context, short term stimulus in the form of various handouts, cash, etc., are likely to exert transient effects - pretty much like the $300 - $600 checks issued to many taxpayers in the 2nd quarter of 2008. So, the advantage of infrastructure spending (public works) may be precisely that it continues and builds over a longer period, stabilizing an otherwise chronically weak economy. The orthodox view probably is that public works are slow to start, often getting in motion after the recovery starts, and contributing more to inflation than job recovery per se. However, this recession looks like it will be longer than average. Housing prices are projected to continue their descent into 2010 and possibly 2011. Drops in housing prices will cause more foreclosures and further problems for the financial industry. In this context, short term stimulus in the form of various handouts, cash, etc., are likely to exert transient effects – pretty much like the $300 – $600 checks issued to many taxpayers in the 2nd quarter of 2008. So, the advantage of infrastructure spending (public works) may be precisely that it continues and builds over a longer period, stabilizing an otherwise chronically weak economy.

]]> By: Lindsay Beyerstein http://washingtonindependent.com/26807/not-so-fastrethinking-infrastructure-and-the-stimulus/comment-page-1#comment-16102 Lindsay Beyerstein Fri, 23 Jan 2009 22:36:07 +0000 http://washingtonindependent.com/?p=26807#comment-16102 I think Baker and Krugman are on the same page here. Baker strongly supports smart infrastructure spending, and he vehemently disagrees with the CBO's WAG that the recession is only going to last two years. His point is just that if sheer speed is your top priority, then a lot of infrastructure spending looks slow compared to other ways stimulating aggregate demand and saving jobs in the short term. I don't want to give the impression that Baker thinks we can't, or shouldn't, do both shorter and longer term stimulus. I think Baker and Krugman are on the same page here. Baker strongly supports smart infrastructure spending, and he vehemently disagrees with the CBO's WAG that the recession is only going to last two years. His point is just that if sheer speed is your top priority, then a lot of infrastructure spending looks slow compared to other ways stimulating aggregate demand and saving jobs in the short term. I don't want to give the impression that Baker thinks we can't, or shouldn't, do both shorter and longer term stimulus.

]]> By: Lindsay Beyerstein http://washingtonindependent.com/26807/not-so-fastrethinking-infrastructure-and-the-stimulus/comment-page-1#comment-16101 Lindsay Beyerstein Fri, 23 Jan 2009 22:34:38 +0000 http://washingtonindependent.com/?p=26807#comment-16101 Good point about the suspended construction projects. Those are definitely shovel-ready. But if the goal is economic stimulus, I have to wonder whether there are enough half-finished projects in the US to spend the kind of money we need to pump into the economy. One of the problems with infrastructure as stimulus generally was that when all wishlists for pseudo-shovel ready projects were tallied up, there was still only $150 billion worth, which wasn't nearly enough to be an actual stimulus.<br><br>Another option to consider for quick infrastructure jobs: There are billions of dollars of deferred maintenance projects on our existing infrastructure that could probably get underway much faster than new projects, with the added bonus of being work on stuff we already have and want to keep. If you read the stimulus bill, there are all these mentions of how unfunded maintenance backups are X and money allocated to maintenance is X/10. The reason money is getting spent on new projects rather than maintenance is plain old patronage. Every one of those reps wants a road for their district whether anyone needs it or not. Good point about the suspended construction projects. Those are definitely shovel-ready. But if the goal is economic stimulus, I have to wonder whether there are enough half-finished projects in the US to spend the kind of money we need to pump into the economy. One of the problems with infrastructure as stimulus generally was that when all wishlists for pseudo-shovel ready projects were tallied up, there was still only $150 billion worth, which wasn't nearly enough to be an actual stimulus.

Another option to consider for quick infrastructure jobs: There are billions of dollars of deferred maintenance projects on our existing infrastructure that could probably get underway much faster than new projects, with the added bonus of being work on stuff we already have and want to keep. If you read the stimulus bill, there are all these mentions of how unfunded maintenance backups are X and money allocated to maintenance is X/10. The reason money is getting spent on new projects rather than maintenance is plain old patronage. Every one of those reps wants a road for their district whether anyone needs it or not.

]]> By: Alon Levy http://washingtonindependent.com/26807/not-so-fastrethinking-infrastructure-and-the-stimulus/comment-page-1#comment-16084 Alon Levy Fri, 23 Jan 2009 20:10:48 +0000 http://washingtonindependent.com/?p=26807#comment-16084 According to Paul Krugman, the current depression is likely to last for several years, so it makes sense to engage in some medium- and long-term infrastructure spending. Even projects that will take until the mid-2010s to bear fruit, like Second Avenue Subway, have good stimulus value. It's also a good idea to do them now, when the global recession is reducing raw material costs. Remember that just a year ago, raw materials were so expensive that some US cities had an epidemic of people stealing manholes and selling them as scrap metal. Once global economic growth starts to pick up, commodity inflation will resume, making construction unreasonably expensive.<br><br>I'd rather believe Nobel-winning economist such as Krugman than someone who doesn't publish any research articles in peer-reviewed journals such as Baker. According to Paul Krugman, the current depression is likely to last for several years, so it makes sense to engage in some medium- and long-term infrastructure spending. Even projects that will take until the mid-2010s to bear fruit, like Second Avenue Subway, have good stimulus value. It's also a good idea to do them now, when the global recession is reducing raw material costs. Remember that just a year ago, raw materials were so expensive that some US cities had an epidemic of people stealing manholes and selling them as scrap metal. Once global economic growth starts to pick up, commodity inflation will resume, making construction unreasonably expensive.

I'd rather believe Nobel-winning economist such as Krugman than someone who doesn't publish any research articles in peer-reviewed journals such as Baker.

]]> By: M. Schmidt http://washingtonindependent.com/26807/not-so-fastrethinking-infrastructure-and-the-stimulus/comment-page-1#comment-16071 M. Schmidt Fri, 23 Jan 2009 17:19:47 +0000 http://washingtonindependent.com/?p=26807#comment-16071 California recently suspended ongoing construction projects to address the budget crisis. If these projects aren't shovel-ready, I don't know what is. We have a new building at our University for which the site has been prepared and for which the contract has been awarded. Construction was to start within days of when the building freeze was imposed. I suppose some of the building freeze motivation was the notion that the money for the construction could come from the Fed stimulus package. California recently suspended ongoing construction projects to address the budget crisis. If these projects aren't shovel-ready, I don't know what is. We have a new building at our University for which the site has been prepared and for which the contract has been awarded. Construction was to start within days of when the building freeze was imposed. I suppose some of the building freeze motivation was the notion that the money for the construction could come from the Fed stimulus package.

]]> By: greensmile http://washingtonindependent.com/26807/not-so-fastrethinking-infrastructure-and-the-stimulus/comment-page-1#comment-16015 greensmile Fri, 23 Jan 2009 03:12:04 +0000 http://washingtonindependent.com/?p=26807#comment-16015 Never underestimate the power of a lobby with no opponents. Though it went billions over budget, was the pork barrel of the century for Boston and STILL did not provide us much in the way of public transportation, the Big Dig went on and on. Everyone had a complaint but no one could even slow it down. This note of caution about infrastructure, especially hastily planned infrastructure, is entirely well deserved and I hope some congresspersons are reading this. Never underestimate the power of a lobby with no opponents. Though it went billions over budget, was the pork barrel of the century for Boston and STILL did not provide us much in the way of public transportation, the Big Dig went on and on. Everyone had a complaint but no one could even slow it down. This note of caution about infrastructure, especially hastily planned infrastructure, is entirely well deserved and I hope some congresspersons are reading this.

]]> By: The Washington Independent » Not So Fast…Rethinking Infrastructure … http://washingtonindependent.com/26807/not-so-fastrethinking-infrastructure-and-the-stimulus/comment-page-1#comment-15996 The Washington Independent » Not So Fast…Rethinking Infrastructure … Fri, 23 Jan 2009 00:16:57 +0000 http://washingtonindependent.com/?p=26807#comment-15996 [...] Re­ad mo­re­ fro­m t­h­e­ o­rigin­al so­urce­: The­ Washin­g­ton­ In­de­pe­n­de­n­t » N­ot ... [...] [...] Re­ad mo­re­ fro­m t­h­e­ o­rigin­al so­urce­: The­ Washin­g­ton­ In­de­pe­n­de­n­t » N­ot … [...]

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