Monday, December 22, 2008

Infrastructure and War December 22, 2008

President-Elect Obama is proposing a massive infrastructure spending program which rightly worries many citizens concerned about boondoggles and "bridges to nowhere." While this concern is valid, we must accept that the basic infrastructure of the U.S. is in terrible shape and needs trillions of dollars in renovations/upgrades.

War has many unintended consequences--the nation launching a war does so in the firm conviction of easy victory and no damage to itself--and one is the destruction of infrastructure. In a strange irony, the losers of World War II, Germany and Japan, were so heavily bombed that they could rebuild their infrastructure after the war (with America's money and aid) to the latest standards.

Meanwhile the Western winners of the war (Britain the U.S.--the U.S.S.R. did suffer much damage from the Nazi invasion) were left with aging infrastructures largely intact. (Though the bombing of London did much damage to buildings, the Nazi air assault left the steel mills, railroads, etc. of England mostly intact.)

The after-effects of this are still playing out 60 years later. One of my friends toured a number of U.S. auto factories in the late 90s, and he was struck by the decrepit state of the factories themselves--never mind the high-tech robots inside, the buildings and plant pre-dated World War II.

Why does this matter? I once read that the auto factories in Japan are heated to about 60 degree F., while union agreements keep U.S. factories heated to 68 degrees or higher. Imagine heating a huge, drafty old bulding in one of the coldest climes in the U.S.

This differential in the age of infrastructure is one reason Japan uses far less energy per dollar of output (GDP) than the U.S.

The more you know about aging U.S. infrastructures like subways, water works and electrical transmission lines, the more amazed you are they function as well as they do. For a fascinating look beneath the streets, check out The Works: Anatomy of a City .

Here in California, water districts continue to fund billion-dollar improvements to the hundreds of miles of pipes serving the most basic need of urban dwellers--fresh water. Billions more have been spent strengthening public buildings against earthquakes. In eastern cities, water systems from the 19th century are showing their age, and everywhere in the nation the electrical transmission system is inadequate to the task of moving ever-increasing quantities of electrical power around the nation.

Solar power plants are built in the great deserts of the U.S. for obvious reasons (few clouds, almost no rain, steady sunlight, etc.), but transferring that power to cities requires a new power grid which will cost billions.

The difference between "pork spending" boondoggles like the Bridge to Nowhere and a much-needed water system or power grid is rather obvious. The way to prioritize infrastructure spending is common-sense: those systems which serve tens of millions should be fixed before systems which serve thousands, and those most likely to fail with life-threatening consequences (bridges, etc.) should be upgraded before systems which are not life-threatening.

Many commentators have noted that Japan spent lavishly on infrastructure projects in its attempt to "spend its way out of recession," with little results. But as visitors to Japan know, it is a small nation whose railways and other infrastructure were already superb before the 1991 recession even started. Thus Japan had little to repair and so the spendng was squandered on thousands of bridges and roads to nowhere in sparsely populated rural Japan.

The difference is: the U.S. desperately needs trillions in upgrades, renovations and repair to basic infrastructures like railways, electrical grids, energy-conservation in public buildings, etc.

We are uncompetitive partly because we squander tremendous quantities of energy compared to our advanced-economy competitors. A good $100 billion could probably be well-spent simply better insulating public buildings and facilities in the U.S. and switching over to low-wattage lighting--the easiest, most low-tech ways of reducing the load on our aging power grid and reducing the cost structure of our economy.

Should the Federal government be borrowing a trillion dollars to spend? No, it shouldn't. But since it's a fait accompli, then we as citizens need to demand that the money be prioritized and spent wisely on our real needs, not just in "make-work" pork boondoggles. The Devil is in the prioritizing, and we as a nation need to pressure those tasked with distributing that money to do so not as political rewards but as common-sense repairs to our aging, inadequate water, transport and power grid systems.

As to those who are convinced that all government spending is wasteful and corrupt--it need not be so. Here in my area, the water districts are public utilities, and by all accounts the tax money being spent to insure our water supply is well-managed and profitably spent. Government, like any enterprise, can be well-managed if managers are held accountable and the elected board can be jettisoned for incompetence.

Hint to voters: if you want to reward incompetence, keep electing incumbents and show zero interest in an audit and accounting of tax money being spent.

Here is Part 4 of Chris Sullins' strategic action thriller, Operation SERF: Operation SERF, Part 4

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Thank you, Stephen A. ($10) for your much-appreciated generous donation to this site. I am greatly honored by your support and readership.

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