"Investing" in Infrastructure

President Obama has been making a hard push for the American Jobs Act, a package designed to rebuild the economy with tax cuts and investments. Make no mistake - "investments" means spending and we've been spending for the last two years with nothing to show for it. Infrastructure is one of the many investments included in the Jobs Act . 

According to the White House's website, the American Jobs Act

"includes $50 billion in immediate investments for highways, transit, rail and aviation, helping to modernize an infrastructure that now receives a grade of “D” from the American Society of Civil Engineers and putting hundreds of thousands of construction workers back on the job."

Hasn't this administration spent billions of dollars on infrastructure before? Why yes, they have. According to recovery.gov, Obama's 2009 stimulus package has already spent a combined $53.1 billion on transportation and infrastructure. Does anyone today see "hundreds of thousands of construction workers" employed from the Recovery Act? Not this guy.

It certainly doesn't help that President Obama stood in front of the Brent Spence Bridge last month, a bridge in great shape, to use as an example of infrastructure repairs that needs to be undertaken. According to sources, the Brent Spence Bridge isn't in need of repairs for decades. In fact, the federal funds aren't going to be used to repair the bridge, but build a new one next to it that won't take place for another four years. Anyone want to wait till 2015 to get this economy started? 

Spending on infrastructure has been tried by presidents before President Obama to stimulate the economy. After the stock market crash in 1929, President Hoover and Franklin D. Roosevelt spent massive amounts of money on infrastructure to give the economy a boost. Franklin D. Roosevelt spent $3.3 billion on infrastructure through the Public Works Administration. It created only temporary jobs. In the end, unemployment was still in double digits at 17% and the U.S debt had increased. 

Arguments could be made that if highways and roads were repaired, that would bring businesses in. Could be a valid argument, except that i've never heard of damaged infrastructure as the primary reason why businesses are leaving the U.S or why they aren't hiring any more workers. What the White House fails to recognize (or maybe they do) is that the proposed construction projects create jobs through tax payer dollars. Tax payers paying for jobs doesn't stimulate the economy, it only cripples it. Then, when the infrastructure projects are completed, the construction workers are out of work. They are again unemployed and the U.S is back to square one. 

"So what are you saying Jay? Should we just abandon the idea of infrastructure investments altogether?" 

Nothing is wrong with investing in infrastructure as long as it's necessary. But the primary reason why the government is proposing spending on infrastructure is all wrong. This is an American JOBS Act. The White House is using jobs as the primary reason for infrastructure spending, not infrastructure itself. These jobs hold no value to the economy at all, because it uses tax payer dollars and they're short-lived. Take infrastructure out of the jobs act, put it into separate legislation and actually fund infrastructure that needs repairing. After all, shouldn't we be skeptical on what Obama considers defective or inoperable after the stunt he pulled standing in front of the Brent Spence Bridge?

Washington needs to propose real solutions for our economy. Solutions that remove regulations, lower taxes and attacks our debt - solutions that create JOBS. Infrastructure is not a solution.