America Needs New Infrastructure to Survive, But Will Biden Deliver?

Yves here. It looks as if Tim Conway was hung a bit out to dry by the Biden Administration. This post launched yesterday, which was supposed to be the day when Biden filled in the details of his Build Back Better. Biden had promises lots of infrastructure goodies, with emphasis on green projects.

But the Administration has dithered a month with its $1.9 trillion stimulus package in trying to make it a bi-partisan project, and has since given up and is now pursuing it as a Democratic party deal. That means with all the sausage-making process, it will be nip and tuck as to whether the bill is put to bed by mid-March, when additional Federal unemployment support expires.

That means that even filling in the blanks in the Biden infrastructure plan has been pushed back by at least a month. And the details matter. As we documented in Quick Comments on the Biden-Harris Covid Plan: Not Much Sizzle and No Steak, his lofty campaign promises were cut back massively once he won the election.

From Construction Dive, first in July 2020:

In a Tuesday afternoon speech, presidential candidate Joe Biden outlined his plan for nearly $2 trillion in infrastructure spending, focused mostly on renewable energy and electrification, which he described as a “one-time” opportunity to reestablish the U.S. as a global economic and political leader…

He said he would build 1.5 million new, energy efficient homes to address emissions and the affordable housing crisis. Another 4 million buildings would be retrofitted, spurring the creation of another 1 million jobs, he said, and electrical generation would be decarbonized to ensure these electrified homes run on clean energy.

From Construction Dive earlier this week:

President Joe Biden’s first address to a joint session of Congress — where he is expected to outline specific goals and priorities for measures like an infrastructure package — will not occur this month as was expected….

The coronavirus package is legislators’ top priority, as they eye a March 14 deadline on unemployment benefits. Biden’s address would likely come shortly after a decision on the bill, which could face some hurdles, according to USA Today.

Mind you, we are politely skipping over the wee problem that new construction will largely involve using current fossil-fuel-consuming transportation. Is anyone keeping tabs on which initiatives will really be net carbon reducing when you factor in demolition, dumping, delivery and materials?

And there’s this:

Forgot to include that student debt relief, but you get the picture.

By Tom Conway, the international president of the United Steelworkers Union (USW). Produced by the Independent Media Institute

Patricia McDonald layered on sweaters, socks and mittens and huddled under blankets for 15 hours as the temperature in her Duncanville, Texas, home plunged to 42 degrees in the wake of Winter Storm Uri.

Well after the water in her kitchen froze, McDonald decided she’d had enough and braved a hair-raising ride over snow-covered, ice-slicked roads to get to her daughter’s house several miles away.

The Dallas County probation officer was safe and warm there. However, McDonald couldn’t establish the computer connection she needed to check in with colleagues, and she worried about clients who had had fewer resources than she did for surviving the state’s massive power failure.

This isn’t merely a Texas problem. Failing infrastructure—from pothole-scarred roads and run-down bridges to aging utility lines and dilapidated water systems—poses just as big a threat to the rest of the country.

Without a bold rebuilding campaign, Americans will continue to risk their well-being and livelihoods as the nation collapses around them.

McDonald, financial secretary for United Steelworkers (USW) Local 9487, which represents hundreds of city and county workers in Dallas, grew increasingly angry knowing that it took just several inches of snow and frigid temperatures to knock out the Texas power grid and paralyze the state.

Some Texans, confronted with days-long power outages, slept in idling motor coaches that officials turned into makeshift warming centers or drove around seeking hotel rooms that still had light and heat.

Others hunkered down at home, melting snow to flush toilets after frozen pipes burst or heating rooms with generators and charcoal grills despite the danger of carbon monoxide poisoning. A handful of people froze to death, including an 11-year-old boy found lifeless in his bed.

But even as McDonald and other Texans waited for power to be restored, police and firefighters in Philadelphia used rafts to rescue at least 11 people trapped by a torrent of water after a 48-inch main ruptured in the city’s Nicetown neighborhood.

On February 5, a utility worker in Oldsmar, Florida, averted disaster when he noticed that a hacker had taken over his computer and increased the amount of lye in the drinking water supply to dangerous levels. The security breach provided a chilling reminder that financially struggling water systems not only contend with lead-tainted pipes and failing dams but also with vulnerable computer systems that require urgent improvements.

America cannot move forward if it continues falling apart. That’s why the USW and other labor unions are championing a historic infrastructure program that will modernize the country, improve the nation’s competitiveness and create millions of jobs while simultaneously enhancing public safety.

“There needs to be change,” said McDonald, one of the millions affected by the blackouts that utilities hurriedly imposed because surging demand and equipment failures put the whole power grid “seconds and minutes away” from a catastrophic failure that could have left the state without electricity for months.

A major infrastructure investment, such as the one President Joe Biden envisioned in his Build Back Better plan, will create jobs not only for the workers who build roads and bridges but also for the Americans who manufacture aluminum, cement, fiberglass, steel and other items essential for construction projects.

Stronger, more resilient infrastructure will help America weather the ever more frequent, increasingly severe storms associated with climate change. That means not only upgrading power grids but also encasing utility poles in concrete or relocating power lines underground. It also requires strengthening coastal barriers to guard against the growing hurricane damage that Texas and other states face.

Expanding broadband and rebuilding schools will ensure that children across the country have equitable access to educational opportunities. Investments in manufacturing facilities will enable the nation to rebuild production capacity decimated by decades of offshoring.

And an infrastructure campaign will ensure local officials have the resources they need to manage growth, such as the huge expansion underway at the Electric Boat submarine shipyard in Groton, Connecticut.

Kevin Ziolkovski welcomes the business that the shipyard brings to his community. But Ziolkovski, who represents dozens of Groton Utilities workers as unit president of USW Local 9411-00, said it makes no sense for the federal government to continue awarding bigger contracts to Electric Boat without providing sufficient funds for related infrastructure.

Ziolkovski says Groton Utilities needs $3.5 million more just to construct a new water tank for the shipyard, one of its biggest customers. He also knows that Groton and other towns need funds to upgrade roads, sewerage systems, public transit and recreational amenities to accommodate the expected influx of workers and their families.

“If you want to see these multibillion-dollar nuclear submarines get built for the defense of the entire nation, you should support everything that goes into that, too,” said Ziolkovski, who sees a national infrastructure program as one solution and developed a briefing book on local infrastructure needs for Connecticut’s congressional delegation.

McDonald, who returned to her home after three days to find the power back on but her neighborhood under a boil-water advisory, knows that other communities will suffer unless the nation embraces a rebuilding program.

It pains her to know that America fell into such disrepair that it cannot provide basic services, like power and safe roads, at the very time people need them most.

“There’s no excuse for this,” she said.

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  1. doug

    We need infrastructure upgrade. How to fund? It seems a fair number of the examples here were originally funded by local taxes. As local property taxes have been cut/ held down, the local money to repair and maintain has disappeared. Now the same local tax cutters want Federal money for their projects. What happened to local borrowing and funding? Is it different from the past?
    I am all for Federal funding of national projects such as roads, but local stuff might be best funded at local level with some Federal guarantees.

    1. tegnost

      all we really need is a policy to upgrade infrastructure rather than a policy of handing money to connected insiders. Local borrowing and funding won’t be a drop in the bucket and that lack will be used to say ” sorry, you can’t have that! unless you guarantee profits to the funding banksters”. The system as it stands now makes this article seem fantastic, in the disney sense…

    2. rc

      The Fed can easily fund an entire $10 trillion infrastructure package over a decade. If not completely corrupted, this adds productive capacity at good to high rates of return lowering total factor costs.

      Also, savings could be had from the healthcare rackets that siphon off an unreal 8% to 10% (up to $2 trillion/year) of GDP in skims. The US needs to increase investment by 5% of GDP ($1 trillion) / year to get back on track.

    3. R.k. Barkhi

      The funds are in “our” insanely huge “defense” budgets where because they routinely break the 1996 law requiring an annual accounting,over $21 Trillion dollars have been unaccounted for,n this by outside investigaters. Imagine the real amount if investigated by insiders.

      When we defund the military from the size of the next 10 largest military budgets globally down to merely the largest, we will be able to rebuild our country,pay off student debt and pay for Medicare 4 All with change left over. This will also decrease our military’s huge pollution footprint as they are 1 of the largest sources.

  2. carl

    I’ve read about the need for more money for infrastructure for the last 20 years. Color me skeptical that anything substantial will happen under Biden.

    1. NotTimothyGeithner

      Obama said he would take pay people to dig and fill in holes back in 2009, ignoring our above ground electrical wires. Obama is the “smart” “centrist”. Biden is likely complaining about Star Road in Mario Kart.

    2. IMOR

      Infrastructure needs had ballooned by the mid80s and were a Washington Monthly hobbyhorse 35 years ago. Fulfilling them was supposed to be a major early area of triangulation among already nearly immobile, hostile party and economic blocs. It’s not just the difference between 25 year old me and me at 60 that causes me to join in your pessimism, but also the 5,000 miles I just put in across five western states over seven weeks.

  3. Solar jay

    Upgrading building with windows and insulation etc, will take energy, but done well a energy payback of just a few years, and will work for decades after that.

    For example solar panels are between 1-3 years for them to produce the energy it took to make them. They then will continue to produce for 25 more years. Most are warranted for 80% of their original performance at the end of 25 yrs.

    Wind is about 6 months, including all installation costs.

    And the homeowner sees an immediate reduction in their energy bills and a more comfortable house to live in.

    1. Yves Smith Post author

      You are ignoring total environmental costs: the environmental and energy costs of mining the rare earths, shipping the materials to the manufacturer, shipping the panels to the wholesalers, and the installer pick-up. Oh, and their disposition in 20 years too.

      Plus you assume the house is in an area and oriented so that solar panels make sense. Our house is in a heavily treed area. We are not killing mature trees for the sake of solar. And the trees keep the house cooler in the summer.

      Wind power working assumes high enough routine wind levels. And wind is poorly suited for residential use. The efficiency of large wind towers is much higher than small ones. It’s a misuse of the scarce and environmentally nasty materials used for wind powers to build/deploy small windmills.

      Finally, you skip over that Biden proposes building 1.5 million new houses….

  4. Ping

    It seems rebuilding infrastructure is really about mass privatization or public-private partnerships.

    What happened in Texas is another cautionary tale about equating “freedumb” with eluding sensible regulations and dangers of quasi-privatization.

  5. Roquentin

    In general, if the question is “Will the Biden Administration do something?” You should just assume the answer is no. I don’t know how anyone expected any different. I’d like to think liberal America would finally start facing up to the fact that Trump was at most a symptom, that removing him solves little to nothing, but I know better. They’ll spend 4 years telling us how when their team does the same things it’s somehow different and we’ll ve right back where we started.

    How many more years can these issues fester? 4? 8? 12?

    1. juno mas

      After four years of an inept Biden administration it will be both the Proud Boys and BLM that will be storming the Capitol.

      It is important to recognize that the US political clout in the Senate is NOT based on support by the population, but geography (state support). Add how easy it is to purchase control of Senators, That’s how oligarchy dominates policy. (63% of the population, represented by 57 Senators could not remove a twice impeached POTUS.)

      In 8 years the impact of a “scorched earth” will be a reality. Kiss your democracy goodbye!

  6. Alex Cox

    Interesting that the purpose of all this infrastructure improvement is, in the author’s take, a better shipyard to build nuclear submarines!

    Please wake me when the nightmare ends.

  7. HH

    The U.S. is run by predatory plutocrats. Biden and the coin-operated Congress are there just to maintain a dignified facade on the looting operation. As long as the majority of voters are willing to lower their standard of living in return for receiving infusions of hatred from their favorite demagogues, the nation will continue to decline.

  8. Jeremy Grimm

    Even if Biden launches a large scale infrastructure and infrastructure repair program I am not sure how much infrastructure and infrastructure repair the money would buy without major changes in the ownership of construction Cartels and some of the ownership of existing infrastructure — like the Grid, Internet, and telecommunications. But look on the bright side of life … there are probably still shovel-ready projects waiting from the Obama years. I trust that Biden has replaced the government appointees who oversaw where the CARES Act trillions went so that we will at least have some idea where all the infrastructure and infrastructure repair money went.

  9. Sound of the Suburbs

    Neoliberals know next to nothing about the monetary system.
    All their mistakes during globalisation have allowed heterodox economists to make enormous progress in this area.
    Even amongst the mainstream there are one or two that do have some idea.

    Paul Ryan was a typically confused neoliberal and Alan Greenspan had to put him straight.
    Paul Ryan was worried about how the Government would pay for pensions.
    Alan Greenspan told Paul Ryan the Government can create all the money it wants, there is no need to save for pensions.
    What matters is whether the goods and services are there for them to buy with that money.
    That’s where the real wealth in the economy lies.

    Neoliberals have got very confused about where the real wealth in the economy lies and money, which comes out of nothing.
    They don’t know what real wealth creation is, and think it comes from things like making money, trade and inflating asset prices.
    It’s a recipe for disaster.

    They always think there is no money, when money comes out of nothing and Governments can create as much as they want.
    They don’t know what real wealth creation is and how to grow an economy in a sustainable way.
    They usually adopt the economic growth model of the US in the 1920s.

    At 25.30 mins you can see the super imposed private debt-to-GDP ratios.

    Bank credit is used for unproductive purposes and it is the money creation of bank credit that drives the economy.
    Debt rises faster than GDP, as you head towards a financial crisis.
    No one realises the problems that are building up in the economy as they use an economics that doesn’t look at debt, neoclassical economics; apart from the Chinese.

    1929 – US
    1991 – Japan
    2008 – US, UK and Euro-zone
    The PBoC saw the Chinese Minsky Moment coming and you can too by looking at the chart above.
    The Chinese were lucky; it was very late in the day.

    1. Sound of the Suburbs

      How did we get here?

      Mankind first started to produce a surplus with early agriculture.
      It wasn’t long before the elites learnt how to read the skies, the sun and the stars, to predict the coming seasons to the amazed masses and collect tribute.
      They soon made the most of the opportunity and removed themselves from any hard work to concentrate on “spiritual matters”, i.e. any hocus-pocus they could come up with to elevate them from the masses, e.g. rituals, fertility rights, offering to the gods …. etc and to turn the initially small tributes, into extracting all the surplus created by the hard work of the rest.
      The elites became the representatives of the gods and they were responsible for the bounty of the earth and the harvests.
      As long as all the surplus was handed over, all would be well.

      The class structure emerges.
      Upper class – Do as little as they can get away with and get most of the rewards
      Middle class – Administrative/managerial class who have enough to live a comfortable life
      Working class – Do the work, and live a basic subsistence existence where they get enough to stay alive and breed

      Their techniques have got more sophisticated over time, but this is the underlying idea.
      They have achieved a total inversion, and got most of the rewards going to those that don’t really do anything.

      Everything had worked well for 5,000 years as no one knew what was really going on.
      The last thing they needed was “The Enlightenment” as people would work out what was really going on.
      They did work out what was going on and this had to be hidden again.

      The classical economists identified the constructive “earned” income and the parasitic “unearned” income.
      Most of the people at the top lived off the parasitic “unearned” income and they now had a big problem. (Upper class – Do as little as they can get away with and get most of the rewards)
      This problem was solved with neoclassical economics, which hides this distinction.
      It’s a pseudo economics that was designed to hide the way the economy actually works.
      It confuses making money and creating wealth so all rich people look good.

      Great minds think alike.
      William White (BIS, OECD) talks about how economics really changed over one hundred years ago as classical economics was replaced by neoclassical economics.
      He thinks we have been on the wrong path for one hundred years.
      Small state, unregulated capitalism was where it all started and it’s rather different to today’s expectations.

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