Campbell: Infrastructure investment is a must
“You cannot build a skyscraper economy on a foundation designed for a farmhouse,” New York Mayor Michael Bloomberg said in talking about America’s infrastructure. We yearn for that bright future but seem unwilling to take care of what we already have. This failure to invest in infrastructure will result in lost jobs, lost opportunities and even lost lives.
Our country spends about 2.4 percent of its economy on infrastructure. In Europe that percentage is more than doubled. The Chinese spend 9 percent. Much of our current infrastructure was built in the decades following World War II and is outdated, worn out and inadequate for the current population without considering inevitable growth. The American Society of Civil Engineers gives our country’s infrastructure a grade of “D,” saying we need to invest $440 billion a year, about $100 a month per person, just to maintain our current infrastructure.
North Carolina fondly remembers Gov. Kerr Scott for “getting us out of the mud,” paving farm-to-market roads, using the proceeds of an incredibly ambitious $100 million road bond referendum. There are other instances where our state invested in infrastructure but our record is spotty, prompting former State Treasurer Harlan Boyles to advocate a three-pronged budget model consisting of the continuation (existing) budget, expansion (new spending) budget and a capital budget, with a dedicated percentage of state spending devoted to maintaining and improving public infrastructure.
Our recent history points to a paradox in budget priorities. During recent recessionary periods, our approach has been to cut government spending, simultaneously throwing large sums of tax credits, incentives and deductions to companies promising to locate here. A New York Times report shows North Carolina governments awarded $660 million on business incentives, more than $69 per person. We consider infrastructure improvements to be expenditures while calling incentives an investment.
Another paradox is that we aren’t willing to maintain our current infrastructure at the same time tens of thousands of new residents are moving here every year, increasing demands on roads and bridges, straining already threatened water, sewer and storm runoff systems and filling already overcrowded and outdated schools and other public buildings. Every day we fall further behind, turning our heads to the problem. It is time to demonstrate our faith in our state.
Examine the economics for a large-scale public infrastructure program. With North Carolina’s spotless credit rating and interest rates at historic lows we likely never again be able to borrow money so cheaply. Construction costs are extremely attractive. A program building roads, bridges, water and sewer systems, schools, airports and other public buildings will jump-start job creation, putting people to work, rippling our through our economy and laying a foundation for a better economic future.
Some say we can ill afford to add millions of dollars of debt service to repay bonds, but there never is an ideal time. When Kerr Scott proposed his roads plan our state was not only mired in mud but in economic doldrums following World War II. There were many skeptics, but Scott convinced us we needed to invest, not only for current needs but also for North Carolina’s future. We need to start building roads (and other infrastructure) to tomorrow. If we believe in North Carolina we can do no less.
Tom Campbell is former assistant North Carolina state treasurer and is creator/host of “NC Spin,” a weekly statewide television discussion of North Carolina issues airing Sundays at 6:30 a.m. on WRAL-TV and at 8:30 a.m. on WRAZ-TV FOX50. Contact him at www.ncspin.com.