Fixing the Political Disconnect Between Infrastructure Needs and Funding

Source: Rick Rybeck, Governing, View blog, October 3, 2013

Much has been written about the need for infrastructure investments to keep our economy competitive. Yet Congress is dialing back federal infrastructure funding to state and local governments, and there’s no groundswell of support from constituents either. How can we reconcile the need for infrastructure funding and the lack of political support?

Here are a few of the reasons why there is a disconnect between the country’s need for infrastructure and the public’s willingness to pay for it:

When infrastructure works well, it is almost invisible and people take it for granted. You turn on the faucet and water comes out. You get in your car and then arrive at your destination.

Related to this invisibility factor is that in many cases we have divorced payment for infrastructure from its consumption. When we go to a store, we part with our money and come away with something that we want. But when we pay our taxes, we don’t have a clear understanding about how the money is spent — on infrastructure or anything else. And because it often appears to be free to use streets and highways, we drive and park in congested places at congested times more than we would if we had to pay the true costs of doing so.

Another reason for the disconnect is that when infrastructure is well-designed and well-implemented, it often inflates the value of well-served land. So after paying taxes for highways or transit, if I want to get the most value out of them I want to have my home or business near a highway interchange or a transit station. But the value of land near these facilities has increased, enhanced by that new infrastructure. So now I must pay a landowner a premium rent or price to have access to the land that my taxes made more valuable in the first place. Paying twice for infrastructure does not make the public happy or enthusiastic about paying for more.

Fortunately, there are ways to lessen the impact of some of these issues….