During Bill Clinton’s campaign for President, James Carville famously insisted “It’s the Economy, Stupid,” and it is certainly true that economic conditions have a huge effect on political attitudes. What that catchy slogan misses, however, is the extent to which the economy, in turn, depends upon a country’s infrastructure.
Societies require systems—both physical and social. Those systems provide us with important, albeit largely taken-for-granted webs of support. When those systems don’t work—or when they have been corrupted or neglected so that they only work for some groups and individuals—a society fails to function as it should.
A colleague of mine once made an observation that has stayed with me: in poor, third-world countries, people are no less entrepreneurial or hard working than those who live in the developed West. The relative lack of economic activity—especially more sophisticated enterprises– can be traced to the lack of basic infrastructure.
Businesses need multiple kinds of infrastructure in order to have a chance of succeeding (beginning with enough people with the wherewithal to buy their goods—i.e. markets). Undeveloped countries lack roads, trucks and railroads to transport necessary raw materials and to ship finished goods. They often lack reliable electricity and potable water. Even more importantly, many countries can’t even provide entrepreneurs with the security and social stability businesses require, the sort of social order we take for granted.
Infrastructure is much more than roads and sewers, important as those are. Infrastructure—in its most expansive sense—includes important social supports like the rule of law. In most western democratic countries (although not in the U.S.), health care is considered part of a country’s essential social infrastructure.
Needless to say, equal access to a robust social and physical infrastructure plays a huge role in mitigating economic inequality.
Elizabeth Warren is one of the few elected officials who seems to understand the essential role played by infrastructure. As she recently reiterated,
“people who built great businesses worked hard. Most successful entrepreneurs worked their tails off. But those businesses needed good soil to grow – and that meant they need roads and bridges to get their goods to market, dependable and affordable power grids, access to clean water and safe sewers, up-to-date communications – the kind of basic infrastructure that we build together.
Coming out of the Great Depression, we built those roads and bridges and power grids that helped businesses grow right here in America. We plowed money into our future, and as those businesses grew, they created great jobs here at home.
But by the 1980s, our country sharply cut back on making those investments in our future, and now we’re getting left behind. Today China spends 9% of its GDP on infrastructure. Europe spends about 5% of its GDP on infrastructure. They are building a future for their businesses – and better jobs for their people. But the United States is investing only 2.4% and looking for more ways to make cuts. Today, the American Society of Civil Engineers says we have about $3.6 trillion worth of deferred maintenance, repairs and upgrading – and every day we’re falling behind.
Disinvestment is worst, of course, in the poorer precincts of our nation—in areas where it is most needed.
America’s failure to attend to our basic infrastructure is one of the most serious policy issues we face. It is maddening to watch members of Congress in both parties posture for interest groups and play petty politics while our bridges and sewers crumble, our power grid degrades, and other countries’ wireless service exceeds ours in reliability and speed.
I think it was Eric Hoffer–the longshoreman/philosopher–who said we cannot judge the greatness of a civilization by the roads and buildings it constructs, but by how well it maintains what it builds.
By that measure, we’re in decline.