Peter Orzag, formerly President Obama’s director of the Office of Budget and Management, was one of the key architects of the 2009 economic stimulus bill. This was the $787 billion spending bill that was supposed to boost the economy through “shovel-ready” construction and infrastructure jobs, its administration cheerleaders repeatedly said.
In a column this week for Bloomberg, rather casually concedes that the bill did almost nothing fix our infrastructure. The column is titled, “It’s Perfect Time To Fix our Roads and Bridges.” He writes:
As my former colleague Larry Summers has written, “No one who travels from the United States abroad can doubt that we have an enormous infrastructure deficit. Surely even leaving aside any possible stimulus benefits, current economic conditions make this the ideal time for renewing the nation’s infrastructure.”
So what to do?
The 2009 stimulus bill helped a bit — it allocated about $100 billion to infrastructure investment (estimates vary slightly depending on the definition of “infrastructure”). But that was only about 12 percent of the total bill, and it was not sufficient to address the growing problem.
Granted, it isn’t exactly news that most of the stimulus bill money was wasted and what wasn’t had little effect, but it is surprising to see one of the people responsible for it concede this so blandly.
From there, Orzag goes on to offer some solutions to the state of our infrastructure which include — surprise! — more taxing (in the form of “user fees” for roads and bridges) and more spending (in the form of subsidies to state and local governments).
One simple point in response: As Orzag concedes upfront in his own column, this didn’t work the first time. The vast majority of the funds were sucked away elsewhere, leaving hardly a dent in the nation’s infrastructure deficit. Why wouldn’t this happen a second time? Orzag doesn’t even think to address the point.