What is Infrastructure?

By Robert Bernstein   |   August 24, 2021

When you hear the word “infrastructure” do your eyes glaze over? As I write this, Congress is debating an infrastructure bill that is on the order of a trillion dollars. Is that a lot or a little?

Almost by definition, infrastructure is all the boring stuff that enables all the cool things in society to happen. For much of human history, this meant roads and bridges and water. Later came sewage systems, water transportation, monetary systems, rail and road transportation, mail, education, electricity, and electronic communication.

Because these things are not very exciting, it is hard to get people excited to fund them. They are taken for granted. Until they break down. At which point it is hard to fund them because people are angry that they are not working. How can you argue with that logic?

Infrastructure is all the “socialist” stuff that free markets depend on, but which free markets won’t fund.

Currently, the U.S. spends about one half of one percent of its GDP on infrastructure. Compare this with Romania and Bulgaria which spend about three times that amount. Or China which spends ten times that amount.

During the Great Depression in the 1930s and on to the Great Society in the 1960s, the U.S. invested heavily in the infrastructure of that era. But investment has mostly stagnated since then while the U.S. population has doubled. And the meaning of infrastructure has changed in the 21st century, while U.S. investments are stuck with what it meant over half a century ago.

Countries like China and even Japan were poor backwaters in the 1960s. But they invested heavily in high-speed rail and now have trains that go as fast as commuter planes in the U.S.

As children, my parents attended the famous 1939 World’s Fair in New York City. It offered a vision of highways and family cars speeding on wide open roads. That turned out to be an empty promise. Freeways become clogged with traffic as they encourage suburban sprawl. Unfortunately, the U.S. is still stuck in that illusory future that never will become reality. While the rest of the industrialized world has invested in smooth, fast, energy-efficient rail.

But there are even bigger parts of infrastructure where the U.S. is an even bigger outlier. Every other industrialized country and even many third world countries guarantee healthcare as a basic right. Again, we are stuck in a mistake that was made in the first half of the 20th century: Tying healthcare to employment.

It never really made any sense, but it was seen as a minor fringe benefit back when healthcare was a small expense. Healthcare was cheap back then because there were not many truly effective medical treatments and people usually died quickly if they had a terminal disease.

Once again, those countries that tackled the problem after the U.S. learned from our mistake and were starting with more modern circumstances. The U.S. spends more than twice as much as any other country, yet it has mediocre outcomes. And, even with Obamacare (which my wife and I depend on), millions of Americans are not covered.

The U.S. was first with creating what became the Internet. But being first is not the same as being the best. Internet speeds in the U.S. are slower than in Hungary, Lithuania, or Croatia. Speeds in South Korea are twice our speeds. And only 88% of Americans have Internet access. Imagine if only 88% of Americans had electricity?

But there is an even bigger elephant in the room when it comes to infrastructure. What is the most fundamental infrastructure of all? How about the very existence of a planet that can sustain us? We are very near to a tipping point in the climate crisis where even zero carbon emissions won’t save us. We will need to start extracting carbon dioxide from the atmosphere for any hope of avoiding major catastrophe.

As with boring things like sewer and water systems, it is hard to get people to put up the money for this. Yet, what is the cost of not putting up the money for this? Some 1,300 square miles of coastal California are less than three feet above the high tide line. Think it is hard to find affordable housing now?

We better learn to invest in boring infrastructure like dramatic carbon reductions, or we will be paying a price that no one can afford later.


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