The high cost of low taxes: Americans don’t want to maintain America

Welcome to the future of “small government.” America’s infrastructure was once the best in the world. But we didn’t want to pay to maintain it.

David Cay Johnston: “America’s Coming Infrastructure Disaster”

For decades, America has scrimped on taking care of the public furniture, endangering people and weakening the economy as bridges rust, roads crumble, dams weaken, and water mains leak. The sudden collapse of an Interstate highway bridge in Minneapolis in 2007, killing 13, and the cracks that shut down the Sherman Minton Bridge connecting Indiana and Kentucky last year (it reopened in February) are warning signs of widespread, but hidden, dangers lurking all around us.

Even greater threats can be found among the decrepit corporate-owned infrastructure, including high-pressure oil and natural-gas pipelines that can explode without warning, electric power poles long past their replacement dates, and a telecommunications system that is far less reliable today than it was two decades ago — despite customers paying more than a half-trillion dollars for upgrades.

America’s infrastructure gets a grade of “D” from the American Society of Civil Engineers, which recommends that we spend $2.2 trillion on repairs and maintenance.

… Under the banner of deregulation, the monopolies that supply electricity, water, gasoline, natural gas, and Internet access have been hollowing out the privately owned infrastructure on which modern life and economic activity depend. Instead of putting more into maintenance, they have slashed budgets. At the same time, they earn phenomenal profits: up to 55 percent on their assets, eight times the average for all corporations.

Corporate monopolies that own railroad bridges, hydroelectric dams, and high-pressure pipelines have skimped on taking care of this infrastructure, putting lives and property across America at unnecessary risk from blackouts, collisions, and explosions, even the threat of entire towns being washed away by bursting dams.

Photo by Leon Tucker, The (Cherry Hill, NJ) Courier-Post.

KYW/CBS Philly: “Freight Train Derails, Spills Chemicals in Paulsboro, NJ; Evacuations Ordered”

Officials say a freight train derailed over the Mantua Creek, leaking a chemical called vinyl chloride, which is considered toxic and highly flammable. Hazmat crews are currently on scene.

It appears the five cars derailed when a bridge they were traveling over collapsed. Some of the trains are currently submerged in the Mantua Creek.

Rescue units have been dispatched to the scene after numerous people complained of respiratory problems. A number of people in the immediate area have been evacuated.

The U.S. Coast Guard has also been notified because the chemical might be leaking into the Delaware River.

Travis Waldron: “How Increasing Infrastructure Spending Provides a Major Boost to Our Economy”

The United States has a massive infrastructure deficit, with independent analysts finding that the country could need as much as $2 trillion in immediate investments just to bring its infrastructure up to date. With the economy recovering slowly and our nation’s roads and bridges crumbling, a new paper from the San Francisco Federal Reserve found that making investments into infrastructure has substantial short- and medium-term benefits for the economy.

Each dollar invested into infrastructure boosts state economies by at least two dollars, the paper found:

Federal highway grants to states appear to boost economic activity in the short and medium term. The short-term effects appear to be due largely to increases in aggregate demand. Medium-term effects apparently reflect the increased productive capacity brought by improved roads. Overall, each dollar of federal highway grants received by a state raises that state’s annual economic output by at least two dollars, a relatively large multiplier. [...]

In other words, for each dollar of federal highway grants received by a state, that state’s GSP rises by at least two dollars.

  • AnonaMiss

    Hooray, an infrastructure post!

    (No sarcasm – while it was the Left Behind posts that brought me here, it was the infrastructure posts that convinced me to subscribe.)

  • Lori

    Dispite their patriotic rhetoric, many people don’t treat the US as a home to be cared about and for, they treat it as a resource to be strip-mined for profit. 

  • Magic_Cracker

    Let the free market do it. Then we can be a fully efficient economy, just like Ireland circa 1850.

  • LL

    See, Fred, this is where your commie tendencies really come out. Because the answer, is to privatize infrastructure. Duh. All the roads will be toll roads. All the schools, corporate owned. All the power infrastructure, ditto. The market will make everything all right. When has it ever steered us wrong? Just ask Grover Norquist and Paul Ryan. They’re the real brains of the Republican outfit, they’ve got it all figured out.

  • Magic_Cracker

    Indeed. Failed state : free market paradise :: tomato : to-mah-to

  • Lonespark

    Aw yeah.  Sing the infrastructure!

  • Buck Eschaton

    The way I understand it, and this may sound crazy, but I think it’s a central insight of MMT (Modern Monetary Theory, see New Economic Perspectives and Naked Capitalism) is that taxes do not fund federal govt. spending. The Fed Gov can spend money into existence.  They don’t want to fund these projects because they would rather sell them off, sell off the functions of Govt. so that they’re buddies can collect rents, so that private entities can essentially tax the public.

  • J_Enigma32

    Ah, yes. Infrastructure, the one area where I can get even the most ardent libertarian to admit that yes, government is necessary (not).

    This is a problem that I saw and incorporated in the Blue Pimpernel. Throughout the book there are references to a number of outdated infrastructures: the trains are commented on (which are using worn, outdated 1980ish technology that’s held together by shoestring and bubble gum… in the 2040s), and the roads are described as cratered like the surface of the Moon. Rolling blackouts are very common, because the power-grid like all of the other infrastructure elements, are over 80 years old and are falling apart. The United States is a blend of the Rust Belt, the Soviet Union, and North Korea, with matching infrastructure and matching political and economic issues.

    The rest of the world, by comparison, has moved well beyond us. For instance, there are maglev trains that can break the speed of sound and India has established at least on functioning moon colony. Diseases have been almost eradicated, cancer HAS been eradicated, humans life has been extended up over the 200 year mark for everyone, and people are stronger, faster, better, and healthier than they were even 30 years before. Meanwhile, the United States still continues to debate over whether or not the world was created 6,000 years ago, while the country burns to the ground.

    But we’re A-number-one, and don’t let those liberals tell you any different. We’re going to go right back to leading the world again as soon as the rest of the world realizes just how screwed they are without us there. Yes we will.

    (You can find the book here: http://www.lulu.com/shop/joshua-kilburn/the-blue-pimpernel/paperback/product-20051241.html;jsessionid=8E1F0D37985C939874D7CDFCCD1072A2)

  • rizzo

    Thank you Grover Norquist.  Raise my taxes damnit, I don’t want this country completely falling apart:(

  • Magic_Cracker

    Apropos of something, here is Pithecanthropus Erectus written, arranged, and performed by the great Charles Mingus.

    Per Wikipedia:

    According to Mingus’ liner notes, ["Pithecanthropus Erectus"] is a ten-minute tone poem, depicting the rise of man from his hominid roots (Pithecanthropus erectus) to an eventual downfall due to “his own failure to realize the inevitable emancipation of those he sought to enslave, and his greed in attempting to stand on a false security.”

    And here’s an afro-cuban rendition arranged by Fred Hoadley

  • Carstonio

    From the Every Problem Looks Like a Nail department, how likely is it that the anti-government attitude that helped lead to this neglect is simply an outgrowth of the Southern Strategy? Where white voters have increasingly thought of government in general in wefare terms?

  • Vermic

    Infrastructure?  America doesn’t need an infrastructure anymore, the Nazis surrendered like 70 years ago.

    They don’t want to fund these projects because they would rather sell them off, sell off the functions of Govt. so that they’re buddies can collect rents, so that private entities can essentially tax the public.

    I got extremely cynical after Enron: The Smartest Guys in the Room.  Nowadays, I assume that behind every privatization effort stands some rich scumbag scheming to make a mint at our expense.

  • Magic_Cracker

    I think you might get something out of Michael Hudson as well. He’s not an MMTist, and can be critical of them, but he’s even more critical of the Neoclassical and Neoliberal guys who, he points out, are neither Classical, Liberal, nor Neo. 

  • Buck Eschaton

    We’re perfectly able to fund infrastructure projects. The only reason why there’s a “shortage” of money is that the rich want to starve us so that they can buy up our assets and our labor for cheap. It’s curious that money becomes no object when we want to fight wars or bail out the rich.  It’s only programs that benefit society at large that “we just can’t afford”. 
    We’re not that far away from a 2nd Great Depression, the Fed Gov. should be creating/spending money like a madman, spending into the economy and providing jobs to the middle class.  Either by spending it on infrastructure or just giving it to the middle class the same way they have just given it to Wall Street and the rich since 2008.

  • Buck Eschaton

    Michael Hudson is great. I love how discussions of the Bible are coming up from the Kansas City school and other places.
    See this from Michael:
    http://michael-hudson.com/1992/03/the-lost-tradition-of-biblical-debt-cancellations/

    Also David Graeber’s Debt: The First 5000 Years is awesome for a beginning understanding of debt and Jubilee in the Bible.

  • Magic_Cracker

    Thanks for the link! I’ve only read his more recent articles.

  • Magic_Cracker

    The only reason why there’s a “shortage” of money is that the rich want to starve us so that they can buy up our assets and our labor for cheap.

    Yup. I’m pretty sure that what the 1%, or perhaps more accurately the 0.01%, is gunning for a  globalized, techno-feudal society. (That 0.99% of the 1% would correspond to lower nobility, knights, and competent courtiers … who are granted wealth and power in exchange for doing the day-to-day dirty work for the 0.01%.) There’s no need to invest in roads when you have an armored Range Rover. You don’t need police when you have Blackwater or whatever the fuck they’re calling themselves today. You don’t need a power grid when your gated community has its own generators. You don’t need a civil society when you can jet from undisclosed location to undisclosed location when things go tits-up and the teeming hordes finally breech the gates. Etc. Etc.

    Sometimes I think the only thing that will stop it will be the looming ecological catastrophe. After all, you can’t eat gold*.

    *Short story idea, free to the talented people: Post-cataclysm, right-wing, gold-bug survivalist finally runs out of canned goods after 30-years in the hills. Thinks he’s going to make out like a bandit what with his Goldline coinage only to discover a post-industrial, gift economy and bolo-based society (small autonomous communities/tribes that agree to (a) non-aggression and (b) free movement (of those not happy with their current bolo)) in which gold is valued inasmuch it is useful (not very). He does have guns and ammo. Take it from there.

  • VMink

    but he’s even more critical of the Neoclassical and Neoliberal guys who, he points out, are neither Classical, Liberal, nor Neo.

    Like, whoa.  So they aren’t the One(s).

    Sorry, I couldn’t resist. …. I’ll get my coat.

  • Magic_Cracker

    Liked out of spite.

  • http://apocalypsereview.wordpress.com/ Invisible Neutrino

    You know, back in the early 1990s, people in Canada used to bemoan the tendency of the Bank of Canada to relentlessly push unemployment up to keep inflation down. Since then that tendency has receded, but it did spawn literature making the case that a government cannot shrink its way to permanent solvency without damaging aspects of a country which are needed to keep it going.

    I can’t find the reference here, but I had an interesting book from 1992/1993 that made the case that the federal government should have, at hand, low-priority, “off the shelf” projects it can put into motion whenever an economic downturn hits, so that it can put people back to work quickly and cut the recession short.

    Also, I highly recommend (even to non-Canadians) the book Paper Boom, which makes a very good case for de-emphasizing the stock market and other rentier vehicles as a measure of a nation’s overall financial health. Indeed, one thing Jim Stanford brought up was the need to upgrade Canadian infrastructure to put in place the kind of road, rail, travel and telecommunications network we need for the next century.

  • Magic_Cracker

    Also, I highly recommend (even to non-Canadians) the book Paper Boom, which makes a very good case for de-emphasizing the stock market and other rentier vehicles as a measure of a nation’s overall financial health.

    There was an episode of Spooks where [SPOILERZ!1!!1!] a currency manipulator who’s been tanking economy after economy (and making a fortune doing so) has come to Britain and it’s up to MI5 to stop him. It turns out he’s really a die-hard, capital-C Communist whose father was a great Soviet hero.  Post-collapse of the Soviet Union, he became a hedge-fund billionaire so that he could use capitalism to destroy capitalism. Sometimes I wonder if there aren’t a few guys like that on Wall Street ’cause sometimes it sure seems like it.

  • Carstonio

    Molly Ivins made the same point about the US Federal Reserve, saying that adjusting rates upward to control inflation means many people lose their jobs. I’ve wondered if a better alternative for the economy’s throttle would be adjusting margins on stock purchases up or down, but that might affect only wealthy investors.

  • http://apocalypsereview.wordpress.com/ Invisible Neutrino

    You have to marvel at that kind of economic judo. The premise makes more sense than that of “Salt”, TBH. :)

  • http://twitter.com/shay_guy Shay Guy

    America’s infrastructure gets a grade of “D” from the American Society of Civil Engineers, which recommends that we spend $2.2 trillion on repairs and maintenance.

    Some will surely say that we can’t afford this. To those people, I say: “…We’re the wealthiest nation in history.”

    An alternative take on the specific matter of deficit spending on infrastructure, using Samuel Vimes’s case of $10 boots that last a year versus $50 boots that last ten years or more. Suppose Vimes could borrow $50 at 1% annual interest (more than the current bond rate), paying it back over the course of six years. That’s $8.54/year, assuming I’ve calculated it right, then no need to spend any money at all on boots for several years more. So taking out that loan is a sound investment — regardless of how much debt he already has. (Of course, you could use that loan for other things, like paying off a loan with higher interest or buying something else that saves you more money in the long run, but even if none of those are available, the boots make the loan worthwhile.)

  • flat

    There is a reason we pay taxes in the Netherlands: half of the country lies beneath the sea.

  • http://apocalypsereview.wordpress.com/ Invisible Neutrino

    Adjusting the margins would have at best an indirect effect, but it would definitely cut down on episodes of “irrational exuberance”.

  • http://twitter.com/jclor jclor

    The frothing, tribalist “love for America” espoused by a certain percentage of the population is perplexing.  It doesn’t seem to extend to anything concrete.

    They certainly don’t love Americans.  They cast aspersion on any member of the majority of us who isn’t independently wealthy and benefits from government services (not that the rich don’t benefit from the government, mind you).

    And they certainly don’t love what made America the model for the world 60 years ago: science, technology, modern infrastructure, education, expanding opportunities.

    What they seems to care about, in the end, is American money, given their desire to acquire it and reluctance to spend it on anything meaningful.  

    It’s like someone bought a Cadillac in 1983, never put any money into maintaining it, and still insists it’s the nicest car on the block despite the fact it’s got four flat tires and the engine’s rusted out.  “It rides like a dream … and look at all this money I’m saving!”

  • Michael Pullmann

    “We could have saved it, but we were too damn cheap and lazy.”

  • http://profiles.google.com/marc.k.mielke Marc Mielke

    Bolo-based economy? I think a civilization run by artificially intelligent cybertanks would be sort of awesome, myself. 
    http://iislands.com/hermit/pictures/bolo/BOLO1_.JPG

  • Magic_Cracker

    Only if I get to be a cybertank! Wait — wasn’t that the plot of the horrendous Dune prequels?

  • http://www.facebook.com/jrandyowens Randy Owens

    What Dune prequels?

    Ahem… What Dune prequels?  No such thing.

  • Magic_Cracker

    Sorry. That information must have been slipped into my mind from an alternate timestream. Carry on.

  • EllieMurasaki

    Not to mention too convinced that doing nothing or doing exactly what got us into this mess is what will get us out of it. With a side of believing a whole bunch more things that ain’t so, such as it’s Obama’s fault that that one company laid off a bunch of folks right after the election when the truth is that the company owner was just having a tantrum, and such as it was not in fact unions who brought us the minimum wage and the forty-hour work week with (in many cases) time-and-a-half pay for time over forty hours.

  • rizzo

     Don’t worry, he’s just messing with you, there are no Dune prequels…it’s all good.  If you’d like, Chapterhouse didn’t exist either, though I’m fond of it myself;)

  • Tricksterson

    I rather liked the Dune prequels, they were no worse than and in some cases *cough*God Emperor of Dune*cough* better than the originals after Children of Dune.  Not crazy about the current lot though.

  • VJBinCT

     But who will take in our infrastructure refugees?  Is there a new America starting up somewhere?

  • Magic_Cracker

    Well, there’s the Great Pacific Garbage Patch. Who sez they’re not making any more real estate?

  • Magic_Cracker

    Chaperhouse didn’t make much sense to me. After all that stuff about Paul being unique, The One, etc. etc. it turns out that Duncan Idaho could have been the One too?  I mean, I’m sure there was some hand-waving of the whys and hows, I don’t remember offhand, but it undermined the plot and premise of the first book, which I really wish was the only one I read. (Dune Messiah was okay, could have been much better, but was clearly setting itself up for a sequel … and Children of Dune I simply didn’t like. I thought it would have been more interesting (and creepier) if Leto sort of evolved/mutated into a Sandworm (or Sandworm-esque monstrosity) over time, “naturally,” rather than slapping Sandtrout on his body like so many nicotine patches.)

    My Dune Dream Trilogy:

    Dune: Leave as is
    Dune Messiah: Jihad, conquest and court intrigue
    Dune 3: Keep Paul Atreides as primary protagonist; return of the machines; Golden Path revealed. The End.

  • http://twitter.com/jclor jclor

    I’ve always thought God Emperor was great for its ideas but fell short on action.  Brian’s “imagined histories” are (so I have gathered) action-heavy and idea-thin.

  • Rowen

     I think you need to define the term “better” here. ^_^ God Emperor was confusing and plodding, but at least it had things like plot and structure. Brian Herbert’s books lack. . . Well, let’s just say that listing the things that are GOOD about them is much easier.

  • Don Gisselbeck

    I haven’t done any calculations, (denial?), but I doubt my taxes cover the costs of 80+ ski/bicycle trips a year onto National Forest lands.

  • http://twitter.com/lesterhalfjr Chris Hadrick

    The priorities of the government are the problem. We spend way way more than we did when we had the best infrastructure in the world. 

    2013 United States federal budget - $3.8 trillion (submitted 2012 by President Obama)[122]
    2012 United States federal budget - $3.7 trillion (submitted 2011 by President Obama)
    2011 United States federal budget - $3.8 trillion (submitted 2010 by President Obama)
    2010 United States federal budget - $3.6 trillion (submitted 2009 by President Obama)
    2009 United States federal budget - $3.1 trillion (submitted 2008 by President Bush)
    2008 United States federal budget - $2.9 trillion (submitted 2007 by President Bush)
    2007 United States federal budget - $2.8 trillion (submitted 2006 by President Bush)
    2006 United States federal budget - $2.7 trillion (submitted 2005 by President Bush)
    2005 United States federal budget - $2.4 trillion (submitted 2004 by President Bush)
    2004 United States federal budget - $2.3 trillion (submitted 2003 by President Bush)
    2003 United States federal budget - $2.2 trillion (submitted 2002 by President Bush)
    2002 United States federal budget - $2.0 trillion (submitted 2001 by President Bush)
    2001 United States federal budget - $1.9 trillion (submitted 2000 by President Clinton)
    2000 United States federal budget - $1.8 trillion (submitted 1999 by President Clinton)
    1999 United States federal budget - $1.7 trillion (submitted 1998 by President Clinton)
    1998 United States federal budget - $1.7 trillion (submitted 1997 by President Clinton)
    1997 United States federal budget - $1.6 trillion (submitted 1996 by President Clinton)
    1996 United States federal budget - $1.6 trillion (submitted 1995 by President Clinton)

    and here’s the#1 culprit

    http://en.wikipedia.org/wiki/Military_budget_of_the_United_States 2012 total budget:1.030–$1.415 trillionout of a total budget of 3.7 trillion 

  • Turcano

    They had the perfect opportunity to lengthen their title to It’s Only a Paper Boom and they squandered it.   Laaaaaaaaaaaame.

  • Turcano

    If you disregard the part about him being a deep-cover Communist operative (although wingnuts would tell you not to), that guy actually exists.

  • http://twitter.com/jclor jclor

    Those numbers, tossed out in reference to nothing, have relatively little meaning.

    The word ‘trillion’ isn’t scary in an of itself.

  • http://apocalypsereview.wordpress.com/ Invisible Neutrino

    Now, be nice. The book came out in 1999. :P

  • P J Evans

    There’s no need to invest in roads when you have an armored Range Rover.

    Right up until you get stuck in the middle of nowhere because there’s no road and the creek is just a bit deeper than it looked (having more sand than rocks). And the locals have good bows and throwing spears and even home-brewed black powder for mortars.
    Or until you run out of parts or fuel for said vehicle – which is a lot more likely.

    I don’t think a lot of the 0.01percent (or the0.99 percent just below them) are capable of keeping anything going when it requires actual work and planning.

  • P J Evans

    they
    were no worse than and in some cases *cough* God Emperor of Dune
    *cough* better than the originals after
    Children of Dune

    I figure everything before Dune and after Dune Messiah is from some alternate universe, because the premises being used changedfrom the first two.

  • http://blog.trenchcoatsoft.com Ross

     Wait, so that’s why Mitt Romney was pumping his own gas?

  • http://apocalypsereview.wordpress.com/ Invisible Neutrino

    Or he just couldn’t pay a minion to pump his gas for him.


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