To Create Jobs, Invest in Infrastructure

Matthew Slaughter:

There is a crucial connection between potholes and unemployment. America's crumbling infrastructure is eroding America's competitiveness in the global economy by eroding America's ability to attract and retain global corporations and their high-productivity, high-wage jobs.

This was not always so. Over much of the 20th century, America's strong infrastructure investment was a major factor attracting global corporations headquartered in other countries to invest and create jobs here. Rising U.S. standards of living were fueled by a strong infrastructure system that facilitated the growth of companies in America, both global and domestic alike: transportation systems to move people and products, electrical systems to power plants and offices, communications backbones to drive computers and creativity. By 2008, the U.S. subsidiaries of foreign companies employed over 5.6 million Americans -- nearly 2 million in manufacturing -- and exported $232.4 billion in goods. That's 18.1% of America's total.

Today is very different. America's decaying infrastructure costs the typical American worker hundreds of hours in lost productivity. It also costs companies time and efficiency in moving their products around -- and also out of -- the country. This decay is particularly stark for global companies, whose executives are witness to the dynamism of emerging economies like China and India that present them with ever-widening choices for where to grow jobs and investments around the world.

Note that Slaughter was on Bush II's Council of Economic Advisors, so it's not like he is a socialist. The economic retrenchment being demanded by most Republicans right now is exactly what we do not need, and it would both deepen the recession in the short term and hurt our economic future.