The $1 Trillion Infrastructure Bill Spends a Lot More Money on the Same Old Highway Programs

“The $1 trillion infrastructure bill that President Joe Biden signed into law..dumps a lot of new money into existing highway programs to be spent by state departments of transportation (DOTs).
The price tag of the bill—which includes $550 billion in new spending, $110 billion of which is earmarked for highways and bridges”

“by mostly topping off existing programs, it will largely maintain a status quo where some states deploy their highway dollars effectively, while others continue to set them on fire in the hopes that that will produce better roads.”

“That would include places like New Jersey, which ranked last in a report on state highway performance released by the Reason Foundation today.

The Garden State, per the report, spent $1,136,255 per mile of state-controlled road in 2019 while also having some of the worst urban congestion and pavement conditions in the country.

That’s well above more cost-effective states like Virginia. It managed to spend only $34,969 per mile of state-controlled roads while also having above average pavement quality and slightly worse-than-average congestion. (Virginia ranked second overall in the Reason highway report, right behind North Dakota.)”

“Feigenbaum says part of New Jersey’s high expenditures can be chalked up to the high design quality of its highways, which have generally wider lanes and straighter curves in order to improve safety. (It ranks fourth in the Reason report in terms of overall fatality rate). But he also says a lot can also be explained by a cronyist state DOT that’s dominated by political appointees.

A state like Virginia has been able to keep up road quality while keeping overall road spending in line by having a more professionally run DOT, he says. It also makes heavy use of public-private partnerships, whereby private companies put in their own capital to rebuild or expand highways in return for being able to charge tolls on the lanes that they build, says Feigenbaum.

In keeping with its “spend more on the same old programs” nature, Biden’s new infrastructure bill does remarkably little to advance public-private partnerships or expand the interstate tolling that supports them.

The infrastructure bill does increase the amount of private activity bonds (tax-exempt bonds issued by a private company to fund an infrastructure project) that can be issued from $15 billion to $30 billion. It also reauthorizes a handful of limited programs that allow states to use tolls to reduce congestion or rebuild bridges. But it leaves in place a general prohibition on tolling interstate highways.

The overall trend in highway spending over the past decade has been higher spending and marginally improved roadway quality, says Feigenbaum, with some states standing out for either their innovations or their wastefulness.

The new infrastructure bill will likely produce more of the same.”

The bipartisan infrastructure law is both historic and not nearly enough

“About $550 billion of the $1.2 trillion law is new spending, which will be spread out over five years. The remaining $650 billion in the bill would have been allocated for existing transportation and highway programs under previously planned funding.
The new money in the bill will go toward a wide range of projects, including road repairs, high-speed internet services, and investments in electric buses. Notably, the infrastructure bill was backed by both Democratic lawmakers and some Republicans, and was the culmination of years long attempts to advance infrastructure legislation that’s spanned presidential administrations.

While it’s a landmark investment, the legislation only authorizes a fraction of the funding required to tackle the entirety of the US’s infrastructural challenges. Across specific categories of the bill, including lead water pipe replacement and broadband, it’s likely to take much more than what’s already been allocated to fully solve issues of access, safety, and equity. The bill includes $15 billion specifically for addressing lead pipes, for instance, while experts believe it will take $60 billion to actually replace every lead pipe in America.

Still, the passage of this bill — which contains critical funding that the country has needed for decades — is significant, and an important down payment for future investments.”

States have the power to make or break the infrastructure law

“Now that President Joe Biden has signed the Infrastructure Investment and Jobs Act (also known as the bipartisan infrastructure framework, or BIF) into law, the federal government faces a new challenge: getting the funds out to states and cities.

In the coming months — and years — federal agencies will distribute billions of dollars for everything from bridge repairs to public transit expansions to bike paths. Most of this money will go directly to state governments, which will have significant discretion over which projects they’d like to fund.”

The infrastructure law aims to clean up pollution in your community

“a bipartisan infrastructure bill that includes $350 billion to address long-ignored environmental threats. The Infrastructure Investment and Jobs Act is the largest sum in recent memory directed at cleaning up pollution, from replacing lead pipes to capping methane-spewing oil wells.
The funding could make a serious dent in air and water pollution for certain communities by preventing runoff from abandoned mines and cleaning up old, toxic manufacturing sites. People who live near busy roadways, airports, and ports may benefit from the boost to electric vehicle charging stations, school buses, and cranes that will replace gas- and diesel-burning cars and equipment.

Other investments will improve public health more indirectly: One of the law’s major provisions includes expanding transmission that can move more clean energy across the grid. By increasing the mix of renewables, states and the utilities they regulate ultimately would need to burn fewer fossil fuels to power the economy.

The biggest criticism of the new law is what it leaves out: Environmental advocates say the funding only meets a fraction of the nation’s needs for addressing water and air pollution, and falls far short of the transformative change Biden promised on the campaign trail.

This is also not the transformative climate bill that climate activists had hoped for.”

Congress Finally Passed Biden’s Inefficient, Deficit-Hiking Infrastructure Bill

“The bill is also larded up with provisions that will make infrastructure projects more costly for taxpayers. That matters, of course, because if you inflate the cost of building a bridge and you have a fixed amount of money to spend on new bridges, you’ll get fewer bridges.

For example, the bill’s “Buy American” provision is nothing more than performative patriotism and a handout to politically powerful unions. By mandating that materials used in road, bridge, and rail projects come primarily from the United States, Congress will effectively hike prices and engage in arbitrary protectionism.”

“The infrastructure bill could have been an opportunity to reform other federal rules that unnecessarily drive up the cost of building infrastructure. Like the Davis-Bacon Act, which requires that most workers on federally subsidized building projects are paid the local “prevailing wage” negotiated by unions even if the workers themselves are not unionized—and only about 13 percent of construction workers are part of a union. The Davis-Bacon Act rules can increase the costs of infrastructure projects by as much as 20 percent.

Similarly, the infrastructure package could have suspended or eliminated parts of the National Environmental Policy Act (NEPA) in order to streamline environmental reviews of infrastructure projects. Currently, NEPA reviews take more than four years on average, and they are frequently used as tools to block development for reasons that often have little to do with the environment.”

America’s Ports Need More Robots, but the $1 Trillion Infrastructure Bill Won’t Fund Automation

“A lack of robots is one of the single biggest problems among the many logistical issues currently tangling America’s supply chains.

At most major ports around the world, the cranes that unload shipping containers from boats to trucks are largely automated. That means they can operate around the clock at lower cost and—extra importantly right now—have zero risk of catching COVID-19. One recent study found that cranes at the mostly automated port in Rotterdam, Netherlands, are roughly 80 percent more efficient than cranes at the Port of Oakland, California, where humans still man the controls. In other words, it takes nearly twice as long to unload the same ship in Oakland as it would in Rotterdam.

One of the major hurdles to automation is the expense. It can cost as much as $500 million to install new, fully automated terminals at existing ports, according to the Journal of Commerce, a trade publication. Even if it might make sense to do that in the long run, short-term considerations keep American ports operating at their current, less efficient status quo.

Conveniently, Congress has just passed a $1.2 trillion infrastructure spending bill—one that includes $17 billion for port infrastructure. Of that $17 billion, about $2.6 billion is specifically earmarked for defraying the cost of upgrading equipment at America’s ports, nominally to reduce air pollution.

If you were a member of Congress looking to spend a bunch of money to immediately and meaningfully upgrade American infrastructure in a way that would help solve the current supply chain logjams, automating ports should be at or near the top of the list. It’s quite literally a no-brainer.

The bad news, however, is buried on page 308 of the 1,600-plus page bill: “The term ‘zero-emission port equipment or technology’ means human-operated equipment or human-maintained technology.”

Yes, the subsidies doled out as part of President Joe Biden’s bipartisan infrastructure deal are expressly forbidden from being used to automate operations at American ports. Instead, taxpayers will spend billions to upgrade existing cranes with lower-emissions alternatives that won’t actually work any faster or cheaper. It’s a major missed opportunity.

Why? Biden’s close ties to labor unions probably have something to do with it. Along with the cost, unions are the biggest reason why American ports don’t have more robots. When an automated terminal was introduced at the Port of Los Angeles a few years ago, the politically powerful longshoreman’s union that represents dockworkers threw a fit.

But the automated terminals were a hit with truck drivers who work at the port. The Los Angeles Times reported in 2019 that drivers, who are paid by the delivery, were thrilled to have more reliable loading schedules, instead of having to wait around for hours to pick up a container. One truck driver told the paper that automation meant no longer having to “wait hours and hours in long lines” because the dockworkers decided to “leave early to go to lunch and come back late.””

“Automated ports in places like Norfolk, Virginia, meanwhile, are handling record volumes with no backlogs, according to the Journal of Commerce. “With the automation, you can rework your yard to say, ‘Okay, while I was expecting to be loading Ship A first, I’m now loading Ship B first,′ and can keep import flow fluid,” Stephen Edwards, CEO and executive director of the Port of Virginia, told the Journal in September.

Ports should invest in automation regardless of whether Congress is subsidizing that transition, of course. But if lawmakers are going to approve huge amounts of new spending to upgrade American infrastructure, it’s fair to wonder why one of the most useful upgrades is expressly forbidden. It looks like Congress and the White House are more interested in cowing to unions than helping fix America’s supply chain problems.”

How Biden’s infrastructure win falls short in one big area

“The bill, H.R. 3684 (117), is historic in its scope with $550 billion in new money funneled into hard infrastructure, from overhauling bridges to supercharging Amtrak’s most popular rail corridor in the Northeast. But it falls far short of Biden’s original vision, which promised to dramatically reduce the climate impacts of transportation, the single largest source of pollution. In the end, the final product was the victim of the bipartisan focus it took to get the bill done and is an example of the razor thin governing majority Democrats must navigate.”

Supply chain havoc is getting worse — just in time for holiday shopping

“Gadgets are particularly vulnerable to shortages because they include many different components. Consider all the parts that go into a PlayStation 5 or a new laptop, including their chips, outer shells, and screens. Many of these components require their own specialized manufacturing facilities, which are typically in different factories and often in different countries. For a device to be delivered on time, all of these parts need to be made in sync. Right now, that’s not happening.”

“Demand for these components has run up against efforts to contain Covid-19 in the countries where the production and assembly of many goods actually take place. Amid a recent delta variant outbreak and nationwide lockdown in Malaysia, the government designated electronics manufacturers critical businesses so that production could continue. In May, Vietnam directed vaccines directly to factory workers, while urging smartphone manufacturers working in the country, like Samsung, to do the same. (Vietnam’s Covid-19 challenges haven’t gone away: This past weekend, tens of thousands of workers fled the country’s commercial center after the government, which is still struggling to access vaccines, lifted pandemic lockdown restrictions.)”

““What will happen is that a phone will be delayed because they’re waiting on their plastic supplier, and the plastic supplier is waiting on the ingredient,” Penfield, the Syracuse professor, said. “It just takes one supplier — and it could be the base ingredient supplier — to fully screw up your supply chain.””

“All these problems mean that consumers are seeing rising prices and shipping delays for a wide range of products. So those looking ahead to the holiday shopping season might want to get an early start, and not just on consumer electronics.”

Lebanon’s electricity was down for a day, but the crisis was years in the making

“the crisis came to a head..when the nation’s two largest power stations ran out of enough diesel fuel to provide even a few hours of electricity in a country already confronted with multiple crises.”

“The blackout comes just over a week after the government allowed a contract with a Turkish company supplying power via two barges off the coast of Beirut to lapse, cutting off that energy supply.
Though common, private generators proved insufficient during the outage — as Beirut-based journalist Bel Trew pointed out on Twitter Saturday, not only are such generators incredibly expensive to run and equally subject to Lebanon’s fuel shortages, but they do little to keep essential services like hospitals running.”

“Lebanon has dealt with energy problems for decades; hours-long outages have long been a part of everyday life. But the country’s current economic crisis, combined with political corruption, has turned what was once a serious, but for many, manageable inconvenience into a far more acute crisis.”

“The shutdown comes as Lebanon is experiencing shocking hyperinflation; the Lebanese lira, which is pegged to the dollar, has dropped 90 percent in value since fall 2019 and is currently trading about 18,900 lira per dollar on the black market. Prior to Lebanon’s 2019 economic implosion, the exchange rate was 1,500 lira per dollar.

That astronomical inflation makes ordinary goods like medicine hard to come by, much less enough fuel to power an entire country.

Critically, the compounding crises have serious political implications, both internally and outside of Lebanon. Hezbollah, the Iran-backed Shia militant group — which is part of Lebanon’s government, although the US has designated it a terror group — brought in gasoline fuel by the truckload from Iran via Syria, according to a New York Times report last month, apparently flouting US sanctions.

Currently, according to the Washington Post, those US sanctions are also a major obstacle to a plan for Lebanon to import gas from Egypt via Syria, which could improve the long-term outlook for Lebanon’s power grid. That could soon change, as US ambassador to Lebanon Dorothy Shea confirmed in August that the Biden administration is seeking “real, sustainable solutions for Lebanon’s fuel and energy needs.”

For the time being, however, the Lebanese government has been conspicuously absent in responding to the interconnected crises facing the country, despite the fact that Lebanon formed a new government last month. That absence has only served to highlight Hezbollah’s ability to deliver basic goods where the central government fails, potentially giving the group a larger foothold in the country.

Lebanon’s new government is also its first functional administration since a major explosion rocked its capital, Beirut, last year, according to the BBC. In the aftermath of that crisis, the existing government resigned, creating a stalemate that took 13 months to resolve.”

“Lebanon’s 2019 financial collapse sprang from decades of bad economic policy: Ultra-wealthy, deeply entrenched public servants have long benefited from a peculiar political system and enriched themselves further by helping themselves to public funds. From 2018 to 2020, the country’s GDP fell from $55 billion to $33 billion — a precipitous drop typically associated with the outbreak of conflict”

“The explosion also destroyed Lebanon’s major grain silo, leaving the country with less than a month of reserves at the time. It also destroyed Beirut’s port area, which handled about 70 percent of the food imports in a country that imports about 85 percent of its food.”

“”Lebanon’s political system is the product of a decades-old power-sharing arrangement among leaders of Lebanon’s 18 religious sects, the most important being the Sunni and Shia Muslims and Maronite Christians. This system, known as confessionalism, parceled out political power according to sectarian quotas, with each sect usually led by one or several members of prominent political families.”

Despite the lack of public services and the blatant corruption of those in power, Lebanese politicians have generally proved adept at playing up sectarian disputes and doing just enough to keep their constituents satisfied.”