A Jobs Proposal. Infrastructure Projects

Infrastructure is something you do to raise industrial productivity. We take capital (savings) and convert it into machines, buildings, roads, etc. in order to achieve greater output per worker. It is unclear building new roads achieves any greater productivity than patching the old ones.[1] Laborers get to their jobs in just about the same time. This is especially true during times of economic distress when workers would rather a new factory be built than a new road. If you want new roads, build them during times of economic prosperity, where the hit on productivity will be less pronounced.

Infrastructure work is predictable. Roads and bridges decay at a predictable rate (unless they have inherent design flaws, like the 2007 I‑35W Mississippi River bridge collapse). The need for new roads and bridges can be predicted based on demographic and economic growth. “Repair our crumbling infrastructure” is a common plea during times of economic distress. A bolus of borrowed money for this purpose often does little for economic productivity (and much for political patronage, bridges-to-nowhere, over-engineered structures and turnover in jobs markets). At best it moves productivity around in time.

The Jobs Agency intends to move productivity around in time to maintain full employment. The problem comes from governments, federal and local, learning to depend on these moments as an excuse to evade their own fiscal responsibilities. They put off infrastructure spending to the point where the roads and bridges become so dire that the political heat gets turned up for increased taxes and spending. Instead the Jobs Agency commandeers funding from these other federal agencies during prosperous times for use during times of economic distress. There will be no new bolus of Jobs Agency money.

1. If you were to leave intact an old road, side-by-side with a new road financed by tolls, how many workers do you think would be willing to pay the toll during bad times?

Back. A Jobs Proposal. Limitations & Guidelines

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