$2 Trillion for Infrastructure?...Ok Boomer

February 25, 2020
Press Release

Rep. Mike Gallagher (R-WI), a member of the House Committee on Transportation and Infrastructure, today spoke on the House Floor to outline his views on how to fix America’s infrastructure.

Rep. Gallagher's full remarks as prepared for delivery below: 

I was lied to as a child. In fact, my whole generation was lied to. We were told time and again, by nearly every futuristic TV show or movie, that by now we’d all be traveling around on jetpacks and hoverboards. Well we’re still waiting. And while we wait, we have to grapple with the fact that we need to use roads wherever we are going, and our outdated infrastructure is nowhere near where it needs to be.

Few issues we debate here in Washington impact the day-to-day lives of our constituents more directly than infrastructure. Yet fixing our infrastructure has become a running joke, with seemingly every week derisively dubbed “infrastructure week.” Infrastructure should not be an afterthought or a backburner priority we deal with only when we have more money or when a true infrastructure crisis emerges. Even in December’s $1.4 trillion spending deal, in which seemingly every lobbyist in Washington got a Christmas present, infrastructure was largely ignored.

Yet infrastructure should not be impossible to tackle. Even as progress on a comprehensive package has eluded Congress in recent years, we have generated important bipartisan wins like a two-year Coast Guard reauthorization and reforms to better utilize the Harbor Maintenance Trust Fund to support critical projects at ports nationwide. And there are plenty more bipartisan wins waiting on the sidelines, such as the Safe Routes Act, the Motorcyclist Advisory Council Reauthorization Act, and the Promoting Women in Trucking Workforce Act that Congress. These bills could pass the House tomorrow to make our roads safer and grow our workforce in key industries. And while they’re small fixes that will not solve all of America’s infrastructure needs, they would represent tangible progress – in a divided Congress – that would improve transportation in communities like Northeast Wisconsin.

But we can’t be content to stop there. Even though now, in the midst of the craziness that comes with a presidential election cycle, it is hard to imagine a comprehensive infrastructure bill passing both the House and Senate I think we should all agree that does not mean that we should punt on thinking through more systemic infrastructure issues. As we consider how the federal government can best support states, set national standards, and promote infrastructure, there are three principles we need to keep in mind:

First, we need to better understand where federal money goes. Before spending one hundred or one trillion dollars on infrastructure, Congress needs to understand where and how federal money is being spent. Unfortunately, we have shockingly little definitive information about America’s infrastructure needs and how much they cost. Given this opacity, it’s no wonder that we often see exorbitant figures quoted for infrastructure costs. For instance, right now, there’s no definitive estimate of the cost difference in building a highway with federal as opposed to non-federal dollars. This should not be difficult to determine—all it takes is finding projects of similar design, and geography to compare. Any Wisconsin family would compare relative costs before a big construction project. Why should the federal government be any different?

The problem is that what little top-line information we have on highways is based on data from 2007-2014. Now, the Federal Highway Administration only reports on what Congress has asked them to report. Up until now, that has not included cost analysis on highway projects. This has to change. Congress should require the Department of Transportation to compare the costs of projects that use federal funds and those that don’t. We should know the breakdown of costs for planning and design, materials, labor, and compliance to understand how to better protect taxpayer money. We should also require the Department to compare states so that we can see which are more efficient and why. What’s more, we need up-to-date data on the comparative health of infrastructure across the country. Outside groups can provide a valuable perspective, but it’s our responsibility as Congress to ensure we have validated, independent data from the states themselves.

For instance, we frequently hear that America has earned a D+ grade in infrastructure. But compared to what standard? And to what other country? We should have quantifiable comparisons to other developed nations. Are we getting relative bang for our buck compared to the UK or Canada? It’s an open question, and the answers may help us find efficiencies and new ideas for infrastructure partnerships. China may have high-speed trains in its coastal cities, but they built them without respect to property rights or the environment. And what is their return on investment? Does China have a plan to maintain their system as it decays in the coming decades? Unless we have comparisons with peer nations, ratings that find America has a D+ in infrastructure lack context. Before we try to prescribe solutions to our infrastructure challenges, we need to get validated data to help us diagnose our problems.

Data is coming to define the modern economy. Yet when it comes to the very engine that literally helps drive our economy from one location to another, we are stuck in the 20th century—or earlier—when it comes to measuring need, progress, and required resources. We have to do better before we sign up for potentially hundreds of billions of dollars in projects.

Second, we need to recognize that it is not how much money we spend on infrastructure, but how that money is spent. One of the fundamental flaws in our infrastructure policy is that we tend to be enamored with shiny new projects, while paying less attention to how we maintain existing roads, bridges, and ports. The Department of Transportation’s 2019 Report to Congress on the “Status of the Nation’s Highways, Bridges, and Transit” notes that nearly 60% of federal money spent on highway infrastructure goes to rehabilitating our existing system. Although that sounds substantial, we should remember that the siren call of infrastructure spending in Washington is predicated on fixing our “crumbling infrastructure.” If this is the case, then why is Congress not dedicating more resources to maintenance? If we truly want to fix our “crumbling” infrastructure, then any future infrastructure package must consider the long-term effect of deferring maintenance of existing projects for new construction.

For example, the foundations underneath many of Wisconsin’s roads were laid in the 1960s and 1970s and are nearing the end of their lifespans. That means that in some cases, the foundation of Wisconsin roads pre-dates Vince Lombardi’s victories in Super Bowl I and II. So why hasn’t this been addressed over the years, particularly in the 2009 stimulus, which spent over $100 billion on infrastructure? Rather than focus on renewing existing roads, the stimulus bill prioritized federal dollars for “shovel ready projects,” which tend to be new highways, interchanges, and frontage roads. So despite receiving almost $400 million in highway funds from the 2009 stimulus, Wisconsin’s roads are still limping along with aging foundations.

In a recent report on Repair Priorities, Transportation for America and Taxpayers for Common Sense found that even after the stimulus, “the percentage of roads nationwide in poor condition increased from 2009 to 2017.” Strong Towns, an infrastructure resiliency organization, has argued for years that governments need to consider roads as liabilities – not assets – because they eventually must be replaced for large sums of money. Yet from 2009-2017, we collectively built 223,000 miles of new roads – enough new lane-miles to crisscross the country 83 times – which Repair Priorities estimates will cost another $5 billion a year just to keep in good condition. Think about this: $5 billion is about 11 percent of the current size of federal highway spending. As Strong Towns asks: if we devoted 100% of all government spending to repair, would we even have enough to maintain what we’ve already built? Probably not. And yet states -- with federal dollars -- are building more. The principle here is that growth of the system creates a future cost to the system which explains much of our current infrastructure funding “crisis.”

Third, we need to think innovatively about the federal role in infrastructure. I hear often that our infrastructure spending and programs are stuck in the 1950s. If this is true, then we need to make sure that our infrastructure proposals aren’t rehashing spending and regulatory regimes from the 1950s. If we keep putting the same broken inputs into the system, we can expect the same broken result.

The most obvious place to start is funding. We can’t just raise the gas tax and throw hundreds of billions of dollars at the problem. That’s particularly true if we don’t have basic data on the scale of the problem. That’s a 1950’s way of thinking. Even beyond T&I Ranking Member Sam Graves’ call for proposals transitioning on a vehicle miles traveled tax, there are plenty of ways that we can think innovatively.

One place to look is the permitting process. Countless billions are wasted in delays and ridiculous budget overruns caused by a regulatory maze of permitting. The potential for savings here is tremendous. For example, the New York Times recently reported that it costs the City of New York nearly 7 times the cost to build a rail project than similar projects almost anywhere. When considering that just the first phase of the Second Avenue Subway cost $4.5 billion even savings of 25% would be enormous. There are enormous savings to be found in cutting down on delays and budget overruns. President Trump’s Executive Order 13807 streamlines the permitting process by designating one federal agency as the lead rather than forcing project managers to navigate between a dozen agencies. This should be codified into law. We also need commonsense reforms like limiting the length of environmental impact statements to 150 pages with a time limit of two years for their completion. It should not take 10 years to do an environmental review and no human is going to read a 3,000-page technical document. We hurt our environment more by dragging the permitting process out for years while more and more cars pile up in traffic.

Another innovative idea comes from our Australian allies. In 2014, Australia launched an Asset Recycling Initiative – a five-year program that set aside $3.3 billion in federal funding which states could access if they sold or leased underutilized public assets to private firms. Money generated from sales or leasing was reinvested into infrastructure projects at the state level. If states met certain criteria, the federal government would match those revenues with an additional 15%. Under asset recycling, the untapped value of America’s underutilized infrastructure is captured and then recycled into other urgent infrastructure needs. Our nation has more infrastructure than any other nation, including China, and consequently we have perhaps untold billions in value frozen in underutilized assets. Leasing or selling these assets to private firms would not only free up that value, but also transfer the maintenance costs to private industry. The potential benefits of this concept are enormous – especially if leveraged towards maintenance and repair of our existing system.

In fact, the Trump administration championed this idea by proposing a federal “Incentives Program” setting aside $100 billion to be granted to states and localities which could meet the criteria of asset recycling. The Trump plan proposed a 20% federal match – even higher than Australia’s 15%. This was a promising idea that should not vanish simply because infrastructure talks broke down last year between the Speaker and the President. Since the essential problem in infrastructure is how to pay for it, the Transportation and Infrastructure Committee should be including programs exactly like these in a future infrastructure package.

It’s no secret that I am a student and fan of Dwight Eisenhower. I like Ike. I believe, like Ike, that the federal government has a role to play in infrastructure. During the Eisenhower administration, in partnership with Canada, the United States built the St. Lawrence Seaway. His most ambitious domestic project, the Interstate Highway program, created a 41,000-mile road system. When I look at Wisconsin, I see the impact that world-class infrastructure has had in keeping us economically competitive.

So, there should be no doubt that we need infrastructure. There should also be no doubt that the current way of delivering, funding, and planning for infrastructure is not working. It’s time to bring the way we think about infrastructure into the 21st century. By focusing on infrastructure transparency and reporting, repairing what we have first, before constructing anew, and by innovating the way we fund and construct infrastructure, we can finally build sustainable 21st century foundation across this nation—at least until we all have hoverboards

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