The U.S. economy could benefit strongly from a substantial increase in infrastructure investment. In the near term, this investment could firm up aggregate demand, thereby supporting job growth and providing a hedge against future drags on demand that might slow the economy. More importantly, increased infrastructure investment can potentially boost the pace of long-run growth and keep us from passing on deficits of deferred maintenance and chronic underinvestment to the next generation of Americans.

Crucially, the returns on infrastructure investments are often widely distributed, allowing communities that have too often been bypassed by the fruits of growth in recent decades to see economic benefits. Greater infrastructure investment is at least as likely to “crowd in” private-sector investment as it is to crowd it out, making many generic criticisms of public spending irrelevant.

The potential benefits of increased infrastructure investment are large enough to justify a substantial commitment from the Federal Government to directly finance it. These potential benefits should not be squandered through vague plans that do not commit this federal financing and instead rely on unproven claims about “leveraging private-sector financing” through tax credits or other mechanisms that promise a free financing lunch. If the benefits of infrastructure investment are real—and we certainly think they are—then they are worth a genuine Federal Government commitment, not window dressing. The plan put forward by the Congressional Progressive Caucus (CPC), to boost infrastructure investments by $2 trillion over the next decade, represents this kind of transparent commitment to a smart policy goal.

Sincerely,

Dean Baker, Co-Director Center for Economic and Policy Research (CEPR)
Jared Bernstein, former Chief Economist for Vice-President Joe Biden
Josh Bivens, Director of Research, Economic Policy Institute
Heather Boushey, Executive Director and Chief Economist, Washington Center for Equitable Growth
Lawrence Chimerine, President, Radnor Consulting Services
Gregory DeFreitas, Professor of Economics, Hofstra University
Brad DeLong, University of California, Berkeley
Ranjit Dighe, Professor of Economics, SUNY Oswego
Steven Fazzari, Distinguished Professor of Economics, Washington University
Jason Furman, Peterson Institute for International Economics (PIIE) and former Chair of the Council of Economic Advisers under President Obama
Christopher Gunn, Professor Emeritus, Hobart and William Smith Colleges
Jonathan Hamilton, Professor, University of Florida
Marc Jarsulic, Vice-President for Economic Policy, Center for American Progress
Timothy Koechlin, Director, International Studies Program, Vassar College
Henry Levin, Professor of Economics, Teachers College, Columbia University
Daniel Luria, Vice President of Research (Retired), Michigan Manufacturing Technology Center
Bernard Niewoehner, Vice President for Legislation, IL NARFE Federation
Paulette Olson, Professor Emeritus Economics, Wright State University
Robert Pollin, Distinguished Professor of Economics and Co-Director, Political Economy Research Institute (PERI) University of Massachusetts-Amherst
Elliott Sclar, Special Research Scholar & Director, Center for Sustainable Urban Development
Robert E. Scott, Senior Economist, Economic Policy Institute
Heidi Shierholz, Director of Policy, Economic Policy Institute
Tim Smeeding, Professor, University of Wisconsin–Madison
Frank Stricker, Emeritus Professor of History and Labor Studies, California State University—Dominguez Hills, National Jobs for All Coalition
Catherine Sveikauskas, Economist
Rob Wassmer, Professor, California State University, Sacramento

Disclaimer: These opinions reflect the signatories personal views and not those of the institutions they’re affiliated with.