A recent Brookings analysis found that only a quarter of jobs in low-skill and middle-skill industries can be reached within 90 minutes by a typical metropolitan commuter. Successful cities will be those that connect workers to jobs and close the digital divide between high-income and low-income neighborhoods.
The White House notes that broadband speeds have doubled since and that more than four out of five people now have high-speed wireless broadband, adoption rates for low-income and minority households remains low about 43 and 56 percent, respectively.
Our economy is changing as fast as our society. Over 83 percent of world economic growth in the next five years is expected to occur outside the United States, and because of rapid globalization, it will be concentrated in cities.
This offers an unprecedented opportunity for American businesses to export more goods and services and to create high-quality jobs at home. The diverse energy boom also disrupts our infrastructure.
Natural gas needs new truck, pipeline and rail networks. Rooftop solar panels have rattled electric utilities, which are scrambling to find ways to incorporate and store the energy they produce while keeping the grid operating. At the same time, finding the money to pay for the development of a smart electricity grid and for clean energy presents challenges, as hundreds of thousands of small and large projects are projected to come online in coming decades.
High-profile natural disasters, such as Hurricane Sandy, drew attention to problems with water infrastructure. Cities are working to capture storm and rain water rather than building costly pipes to sluice it away. Over and above the new types of needed infrastructure is a big change in how projects are financed. Despite the importance of infrastructure, the U. It accounts for about 2. This would add about 1. Split between Republicans and Democrats, the federal government appears incapable of doing this.
For the foreseeable future, the Highway Trust Fund, the State Revolving Funds for water and others will face cuts and squeezed budgets. Other experiments, such as a National Infrastructure Bank, seem prohibitively complex in the current political environment. And of course, rising interest costs on federal debt, increases in entitlement spending and declining traditional revenue sources such as the gasoline tax mean that competition for limited resources is fiercer than ever.
Some cities and states are enjoying budget surpluses because property and sales tax revenues. But most localities will take years to build back their reserves, repay additional debt incurred during the recession and pay for deferred maintenance on infrastructure. And though interest rates remain at historically low levels, the ability of many governments to borrow from capital markets is hindered by debt caps and weak credit ratings.
Despite gradual acceptance in the past decade that infrastructure is vital to economic growth, debate of spending remains an amorphous and simplistic. Infrastructure is made up of interrelated sectors as diverse as a water treatment plant is from an airport, a wind farm, a gas line or a broadband network. The focus on infrastructure in the abstract led to unrealistic silver-bullet policy solutions that fail to capture the unique and economically critical attributes of each.
In reality, each infrastructure sector involves fundamentally different design frameworks and market attributes. And they are owned, regulated, governed and operated by different public and private entities.
The federal role should not be exaggerated. American infrastructure in selected, built, maintained, operates and paid for in a diverse and fragmentary fashion. For other sectors, such as freight rail, telecommunications, and clean energy, the federal role is more limited. Roads, bridges and transit must be paid for largely from public funds.
Ballot measures have been important for fund raising, particularly at the local level, because general obligation bonds require popular approval. Many cities are following this trend. Metropolitan transportation initiatives are popular among voters. According to the Center for Transportation Excellence, 71 percent of measures were passed in as were 73 percent in While state level ballot measures on infrastructure spending are far less common, in , eight states voted to raise taxes for such projects.
This includes both conservative strongholds such as Wyoming and Democrat-controlled legislatures in states such as Maryland. Eligibility checker. There is a growing consensus among G20 countries as to the importance of infrastructure, the permanent assets that a society needs for the orderly operation of its economy, as a driver of growth, jobs and competitiveness. The road tunnel is built under the Bosphorus Straits and links the European and Asian sides of the city.
More videos. OECD and IMF analyses have shown that for every dollar of investment in infrastructure, such as motorways, bridges, power plants and grids, communication systems, ports, airports, housing, water, sewers and social infrastructure, there is a x1. Despite this evidence and the strong consensus regarding infrastructure investment, statistics demonstrate that the G20 economies have reduced their investments in infrastructure since the global financial crisis in And yet, the world is currently suffering from a major financing shortfall for infrastructure investments.
Several studies keenly signal the infrastructure funding gap up to and even beyond. This requirement for capital clearly cannot be met by public sources of finance alone. Since the sovereign debt crisis, the traditional approach to infrastructure funding and finance has face s real barriers. High government indebtedness in many if not most emerging market countries has deterred public-debt-driven delivery as a scalable alternative to build urgently needed infrastructure.
In addition, the fundamental shift of liquidity from banks towards institutional investors in the wake of the global financial crisis has added further challenges to the traditional financing model for emerging-market infrastructure. When the projected increase in aviation emissions is put to her, Rosewell contends that the trading of emissions would be an important aspect of expansion with technological change and investment making savings elsewhere. Show More. Read more.
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