AASHTO Journal, 18 January 2013
If the nation doesn’t soon address the investment gap in its infrastructure, especially transportation, there will be a “cascading impact” on the economy of the nation, according to a report released this week by the American Society of Civil Engineers.
The report, “Failure to Act: The Impact of Current Infrastructure Investment on America’s Future,” is the final report in a series that shows the economic consequences of under-investing in U.S. infrastructure. There were four previous reports focused on investment gaps in separate infrastructure areas: surface transportation; airports, inland waterways, and marine ports; electricity; and water and waste water.
The latest report, a summary of the previous four, reiterates that all the infrastructure areas are connected and that all must be well-funded in order to work at all and help the nation prosper economically.
“It is clear that there is an interactive effect between different infrastructure sectors and a cumulative impact of an ongoing investment gap in multiple infrastructure systems,” according to the report. “For example, regardless of how quickly goods can be offloaded at the nation’s ports, if highway and rail infrastructure needed to transport these goods to market is congested, traffic will slow and costs to business will rise, creating a drag on the U.S. economy that is ultimately reflected in a lower GDP.”
ASCE’s Failure to Act report on surface transportation found that deteriorating surface transportation infrastructure would prove costly to the country. The report said the country is currently facing a funding gap of about $94 billion a year at current funding levels, which means that under-investment would cost the economy upwards of 876,000 jobs and slow the growth of U.S. GDP by $897 billion by 2020. The Failure to Act report on airports, inland waterways, and marine ports found that aging infrastructure and congestion in these areas was making shipping more expensive and increasing the cost of goods for customers. Upgrades are needed through additional investment in order to keep the economy moving forward and to stop the loss of 1 million jobs by 2020, according to the report released last September.
“Overall, if the investment gap is not addressed throughout the nation’s infrastructure sectors, by 2020, the economy is expected to lose almost $1 trillion in business sales, resulting in a loss of 3.5 million jobs,” according to the report. “Moreover, if current trends are not reversed, the cumulative cost to the U.S. economy from 2012-2020 will be more than $3.1 trillion in GDP and $1.1 trillion in total trade.”
The full 28-page report is available at bit.ly/ASCEfailuretoact.