POLITICO: Put Our Money Where Our Mouth Is - Build Better

This article can be found on Politico.

This week, the Treasury Department and Council of Economic Advisers released an important new analysis on the economic benefits of transportation infrastructure investment.

The findings prove what we have long been advocating: Our nation’s infrastructure has been neglected for far too long. But smart investment can yield job creation and long-term economic growth, and the public and business community is ready for action.

Whenever we travel to other nations to promote U.S. industry and enterprise – like Gov. Schwarzenegger’s recent trip to Asia – we see the tremendous progress being made overseas. We worry that our nation could fall behind the rest of the world if we don’t start doing more to invest in our future.

In Seoul, the skyline is full of cranes — thanks to construction partnerships between the government and private sector. China, Japan and South Korea all have high-speed trains that efficiently transport people and goods, sometimes at more than 200 miles per hour.

Yet here in America, we have nothing like that. We continue to rely on the antiquated infrastructure our parents’ generation built.

We owe it to our children – and our country – to build infrastructure that could allow us to remain the world’s economic superpower in the 21st century. Equally important, large infrastructure projects would put many Americans to work during this time of high unemployment.

President Barack Obama has outlined a promising plan to spend $50 billion on transportation improvements, which would allow us to construct and improve 150,000 miles of roads, 4,000 miles of railways and 150 miles of airport runways. The additional $50 billion would be a down payment on the broader six-year transportation bill, which Congress could consider next year, and which may cost upwards of $500 billion.

The issue is not about increasing spending -– it is about making tough choices that could maximize economic return, reduce spending on wasteful projects and strengthen U.S. economic competitiveness. Now, most infrastructure money is distributed through formulas with no incentives for results or performance – and the rest of the money is spread through pork-barrel earmarks. The last transportation bill had more than 6,000 earmarks, costing more than $24 billion.

While no state should be left starving, each should be forced to compete to earn its slice of the pie — with more money for projects that yield the greatest economic return. Such an approach would require the federal government to set standards about how money should be allocated. Those standards should be built around solid national goals – for our economy, environment and national security. In addition, there should be a system of carrots and sticks to ensure that projects are completed on time and on budget.

When the Bush administration created a competitive grant process for $1 billion in transportation aid, and when the Obama administration created a competitive grant process for $4.3 billion in education aid, states reacted by adopting innovative and effective reforms. The lesson? Money talks – and states and cities listen.

By judging states’ infrastructure projects on how well they strengthen our economy and put people back to work, the federal government can start getting our country back on track.

For example, Washington wants to double U.S. exports, yet our current transportation system is already overly congested, costing our country more than $200 billion a year in lost economic activity, wasted fuel consumption, cargo delays – not to mention sheer frustration. But by investing the most money in fixing the worst bottlenecks -- transport costs can lower; commercial activity can quicken; private investment can rise; jobs can increase, and the economy will grow.

The president is correct to connect investment to performance, with a proposal to create a National Infrastructure Bank. That bank could finance large projects based on national standards and goals, allowing Washington to increase investments in big projects that cut across state lines.

Washington could also use standards and competition to ensure new transportation spending decreases carbon pollution. This can help shift money from outmoded technology to new transit choices that clean our air, reduce U.S. foreign-oil dependence and ensure we are building a 21st-century infrastructure.

At a time when the acrimony in Washington is as bad as ever, infrastructure reform offers common ground for independents, Democrats and Republicans. We are all dedicated to fiscal responsibility, forward-thinking ideas and job creation.

It’s time to put our money where our mouth is.

Arnold Schwarzenegger, Republican, is the governor of California. Ed Rendell (Democrat) is the governor of Pennsylvania. Michael Bloomberg, independent, is the mayor of New York. They are all the co-chairmen of Building America’s Future.

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