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Archive for Thursday, October 23, 2008

Infrastructure needs urged for stimulus

October 23, 2008

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— The $600 rebate checks provided by the federal stimulus package earlier this year may have been popular among taxpayers, but many economists think any future effort should focus on infrastructure spending and other targeted measures.

Spending on new roads, bridges and other public works projects would create jobs and provide more of a lasting boost to the economy than another round of rebate checks, several economists said. They contend a common concern about infrastructure spending - that it takes time to gear up and may not kick in until after the recession is over - is less compelling now because the U.S. economy likely will experience an extended downturn.

"We're going to be in a longer period of weak growth and high unemployment" than was expected earlier this year, said Laurence Meyer, vice chairman of Macroeconomic Advisers and a former Federal Reserve governor. Any new stimulus needs to "have more legs" than the rebate checks, he said.

House Speaker Nancy Pelosi of California and fellow congressional Democrats are pushing a new stimulus package that could cost as much as $150 billion, though some economists think the total should be $300 billion or higher.

Comments

Janet Lowther 6 years, 2 months ago

While the US suffers from a calamatous shortage of infrastructure investment, Infrastructure projects take a while to get going: Two years between contracting for a new bridge and the actual construction is pretty typical.These projects have to be planned, designed and engineered, processes which take time - and short changing those processes is prone to have nasty long-term consequences.The $600 rebate put money into the economy right away. It will take years for infrastructure projects to start paying out in any big way.On the other hand, I WOULD like to see a new double track railroad built paralelling I-44: with a container loading/unlloading facility at each interstate crossing. Trains are so much more fuel and labor efficient than trucks.

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