In today’s Wall Street Journal, the Brookings Institution’s Clifford Winston points out some critical pitfalls likely to face the infrastructure spending element of President-elect Obama’s “stimulus” plan:
One of the biggest killers of all is that states insist on allocating federal transportation funds through a politically devised formula. The result? Smooth, well-paved rural highways and worn-out urban roadways that are paved with a layer of asphalt too thin to withstand heavy use and are therefore in need of excessive, costly maintenance.
But don’t blame the states for all the inefficient use of highway dollars. Federal regulations have also inflated the cost of providing roads, trains and so much more for a public on the move.
It takes the nation’s busiest airports decades and billions of dollars to build new runways, for example, because of onerous regulations imposed by the Federal Aviation Administration and the Environmental Protection Agency. Davis-Bacon mandates, which effectively require that “prevailing” union wages (often much higher than the actually prevailing market wage) be paid to workers on any construction project receiving federal funds, also drive up the costs of roads and other federal transport projects. The Federal Transit Act also makes it extremely expensive to lay off transit employees.
Winston is right to point all this out, and he makes some sensible recommendations, including reform of Davis-Bacon. However, reforming the federal infrastructre spending process can only lessen wasteful spending so much, since as long as government is involved, politics will remain a part of the process. (Still, a light touch is too much to expect from Washington, so Obama taking Winson’s advice into consideration is to be hoped for.) For more on Davis-Bacon, see here.