In fiscal year 2007—the most recent year for which data on combined spending by the federal government and by state and local governments are available—total public spending for transportation and water infrastructure was $356 billion, or 2.4 percent of the nation’s economic output as measured by its gross domestic product. For the purposes of this study, transportation and water infrastructure encompasses infrastructure for all forms of surface transportation (highways, mass transit, rail, and waterways), aviation, water resources (such as dams and levees), and water distribution and wastewater treatment.

Recent Developments in Public Spending for Transportation and Water Infrastructure

Between 2003 and 2007, real (inflation-adjusted) public spending on transportation and water infrastructure declined by $23 billion, or 6 percent. That decline, which reflects a decrease in real capital spending, especially by the federal government, stands in contrast to the fairly steady increase in spending for such infrastructure during the previous two decades. In particular, real capital spending on highways, mass transit, and aviation fell markedly even as capital spending on other types of infrastructure— such as rail and water transportation, water resources, and water supply and wastewater treatment-remained stable or rose. The drop in real capital spending for highways, mass transit, and aviation between 2003 and 2007 was primarily the result of a sharp increase in prices for materials used to build such infrastructure—an increase that outpaced the growth of nominal (currentdollar) spending on those types of infrastructure.

Introduction

Good morning and thank you Chairman Dodd and Senator Shelby for welcoming me to the
Senate Banking, Housing and Urban Affairs Committee.

The time for action is now - America’s infrastructure is crumbling and urgently needs to be repaired and modernized.

Bob Darbelnet, President and CEO, AAA: "AAA supports President Obama's effort to focus on transportation investment as a positive way to further accelerate economic recovery and enhance our nation's global competitiveness.

Dear Senator Reid, Senator McConnell, Madam Speaker and Mr. Boehner,

As members of Building America’s Future, we write to urge action by the House and Senate on legislation that will create a National Infrastructure Bank to help our cities and states find additional methods of financing for projects of regional and national significance. President Obama reiterated his support for this idea on September 6, 2010 and we applaud that announcement. As you may know, the U.S.

Congress passed the American Recovery and Reinvestment Act of 2009 at the urging of President Obama, who signed it into law four days later. A direct response to the economic crisis, the Recovery Act has three immediate goals:

• Create new jobs and save existing one

• Spur economic activity and invest in long-term grow

• Foster unprecedented levels of accountability and transparency in government spending

The Recovery Act intends to achieve those goals by:

The State of Metropolitan America is a signature effort of the brookings Metropolitan policy program that portrays the demographic and social trends shaping the nation’s essential economic and societal units—its large metropolitan areas—and discusses what they imply for public policies to secure prosperity for these places and their populations.

On Labor Day, President Obama announced a bold plan to renew and expand America’s infrastructure. The plan includes a $50 billion up-front investment connected to a six-year reauthorization of the surface transportation program and the creation of a National Infrastructure Bank to leverage private capital and select projects of regional and national significance. The Department of the Treasury, with the Council of Economic Advisers, has conducted an analysis of the economic effects of transportation infrastructure investment.

After the long economic expansion that characterized much of the current decade, the nation entered its 11th postwar recession in December 2007. The subsequent decrease in jobs and comparison of the latest recession to the Great Depression intensified congressional interest in passing legislation early in 2009 aimed at encouraging creation of new jobs and warding off further loss of jobs.

In the past, strategic investments in our nation’s transportation infrastructure—the railroads in the 19th century, the interstates in the 20th—turbocharged growth and transformed the country. But more recently, America’s transportation infrastructure has not kept pace with the growth and evolution of its economy.

Congress has been interested in high speed rail (HSR) since the 1960s, but the provision of $8 billion for intercity passenger rail and high speed rail projects in the American Recovery and Reinvestment Act (ARRA; P.L. 111-5), enacted in February 2009, has catalyzed enthusiasm for high speed rail in Congress and the nation. One consequence has been a proposed authorization of $50 billion for intercity passenger rail development (including high speed rail) as part of new surface transportation authorization legislation.