Public Works Funding Falls as Infrastructure Deterioriates

By on August 17, 2017

From New York Times:  It’s basically the opposite of a major government infrastructure program.

Government spending on transportation and other public works is in decline as federal funding stagnates and state and local governments tighten their belts.

Such spending equaled 1.4 percent of the nation’s economic output in the second quarter of 2017, the lowest level on record, according to Census Bureau data.

In West Virginia, where President Trump on Thursday touted a vague $1 trillion infrastructure plan, public works spending has fallen for five straight years.

Nate Orders, who runs a construction company founded by his grandfather to build bridges for the state, said he had been forced to scramble for other kinds of business. Only three of the 15 projects on his current slate are bridges in West Virginia.

“My grandfather would not recognize the business we have today,” he said.

What’s worse, he said, is that he recently hit a highway pothole and had to replace a wheel. “We’re fortunate, I suppose, that we don’t have a growing population, so we don’t have a lot of congestion issues,” Mr. Orders said. “Our problem is safety.”

The deterioration of the nation’s infrastructure has raised widespread concerns about safety, quality of life and the impact on economic growth. Politicians in both parties have declared the issue a priority. So far, there is no sign of a solution.

In 34 states, spending on government construction projects was lower last year than in 2007, adjusting for inflation. The trend has continued this year. Public construction spending in June was 9.5 percent lower than during the same month last year.

Ken Simonson, chief economist for the Associated General Contractors of America, said many states were struggling financially. Illinois, for example, briefly suspended work on 900 projects in early July during a standoff over the state’s budget.

“It’s always easier to defer new construction than to stop paying people who are on the payroll or the welfare rolls,” he said. “A lot of states are under real stress.”

Governments have cut back most sharply on new construction projects. Even so, the nation’s existing infrastructure continues to age and deteriorate.

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