I would actually be fairly relieved if the money was spent on needed repairs, as it wouldn’t be fueling the infrastructure/sprawl feedback loop by creating more infrastructure that would need repair in the future.

It’s almost like there’s an infrastructure bubble. (maybe I should write on that) There’s so much infrastructure, it cannot sustain itself without massive infusions of cash for repairs, which politicians have little incentive to spend. If I could, I would tell states, no new infrastructure money until your existing infrastructure is in good shape.

Unfortunately, the political forces are too strong to be overcome by rational people like you. Politicians will always favor new projects, and Obama’s trillion dollar plan will attract pork like Kermit the Frog in a tuxedo. (sorry, that’s the best analogy I could think of)

Worst of all, I don’t think repairing infrastructure will spur a recovery or many create jobs, except in certain sectors. Sure, engineers and contractors will do well, but how will they spur a recovery? (Interestingly, those are all male-dominated jobs. What about the ladies?)

And the repairs won’t improve productivity, which would bring a sustainable recovery. For that reason, if I believed in stimulus, I’d spend on technology, research, and education that would enable a more robust recovery that doesn’t shift as much burden to future generations.

I would actually be fairly relieved if the money was spent on needed repairs, as it wouldn’t be fueling the infrastructure/sprawl feedback loop by creating more infrastructure that would need repair in the future.

It’s almost like there’s an infrastructure bubble. (maybe I should write on that) There’s so much infrastructure, it cannot sustain itself without massive infusions of cash for repairs, which politicians have little incentive to spend. If I could, I would tell states, no new infrastructure money until your existing infrastructure is in good shape.

Unfortunately, the political forces are too strong to be overcome by rational people like you. Politicians will always favor new projects, and Obama’s trillion dollar plan will attract pork like Kermit the Frog in a tuxedo. (sorry, that’s the best analogy I could think of)

Worst of all, I don’t think repairing infrastructure will spur a recovery or many create jobs, except in certain sectors. Sure, engineers and contractors will do well, but how will they spur a recovery? (Interestingly, those are all male-dominated jobs. What about the ladies?)

And the repairs won’t improve productivity, which would bring a sustainable recovery. For that reason, if I believed in stimulus, I’d spend on technology, research, and education that would enable a more robust recovery that doesn’t shift as much burden to future generations.

If we just focus on repairing the infrastructure we already have that everyone can agree is worth keeping, we can avoid waste, create jobs quickly, and in the end be proud of the results. Moreover, with their repair backlogs reduced, states and localities can focus their own nonfederal resources on more innovative and potentially transformational projects like transit starts.

If we just focus on repairing the infrastructure we already have that everyone can agree is worth keeping, we can avoid waste, create jobs quickly, and in the end be proud of the results. Moreover, with their repair backlogs reduced, states and localities can focus their own nonfederal resources on more innovative and potentially transformational projects like transit starts.

I find this phrasing kind of interesting, because to me a bridge is a durable good, and as the writer goes through these other unbuilt goods, they seem to get more consumable, and less lasting or valuable.

Hazlitt is not distinguishing among goods to assert whether one is better than another, but it does seem that as he lists goods they are more essential to human existence in order to make a point. He is simply stating that there are opportunity costs to the construction of the bridge. The private production of many goods and services was sacrificed for the construction of the bridge. Whether they are more durable or less durable is irrelevant in my opinion. To argue that a durable bridge is inherently more valuable than consumable human necessities such as food, shelter, and clothing would be a tough argument to make in a less abundant society.

The other thing this analysis ignores is the time value of money. Over its entire life cycle this bridge may (or may not) gain in value, whereas the unmade dresses, had they been made would have been consumed and possibly end up in a landfill in a year or two.

I don’t see how the time value of money works in favor of the bridge. According to the time value of money, the future value of an investment is discounted over the years of its useful life. Basically, it means you’d rather have something today than something tomorrow, and the the future value of something like a bridge is more uncertain the further into the future you look. If anything, the time value of money argument works against long-term investments such as infrastructure, in favor of shorter-term returns on capital. (especially when trying to recover from a recession)

Also what if they are made in china, then the value is not captured locally anyways.

The anti-foreign argument goes into a whole other discussion on trade and economic fundamentals such as competitive advantage. It is beyond the scope of this blog, but I’d be happy to refer you to some resources on that subject, starting with the Hazlitt book in the post.

However, one who favors locally produced products and services should reconsider supporting over-investment in infrastructure that subsidizes transport of things not produced locally.

I find this phrasing kind of interesting, because to me a bridge is a durable good, and as the writer goes through these other unbuilt goods, they seem to get more consumable, and less lasting or valuable.

Hazlitt is not distinguishing among goods to assert whether one is better than another, but it does seem that as he lists goods they are more essential to human existence in order to make a point. He is simply stating that there are opportunity costs to the construction of the bridge. The private production of many goods and services was sacrificed for the construction of the bridge. Whether they are more durable or less durable is irrelevant in my opinion. To argue that a durable bridge is inherently more valuable than consumable human necessities such as food, shelter, and clothing would be a tough argument to make in a less abundant society.

The other thing this analysis ignores is the time value of money. Over its entire life cycle this bridge may (or may not) gain in value, whereas the unmade dresses, had they been made would have been consumed and possibly end up in a landfill in a year or two.

I don’t see how the time value of money works in favor of the bridge. According to the time value of money, the future value of an investment is discounted over the years of its useful life. Basically, it means you’d rather have something today than something tomorrow, and the the future value of something like a bridge is more uncertain the further into the future you look. If anything, the time value of money argument works against long-term investments such as infrastructure, in favor of shorter-term returns on capital. (especially when trying to recover from a recession)

Also what if they are made in china, then the value is not captured locally anyways.

The anti-foreign argument goes into a whole other discussion on trade and economic fundamentals such as competitive advantage. It is beyond the scope of this blog, but I’d be happy to refer you to some resources on that subject, starting with the Hazlitt book in the post.

However, one who favors locally produced products and services should reconsider supporting over-investment in infrastructure that subsidizes transport of things not produced locally.