Monday, December 8, 2008

Highway and Infrastructure Spending Does Not Work to Add Jobs

I cannot understand why Democrats always believe that dumping money immediately into roads, bridges, and other infrastructures are a cure-all to stimulate a depressed economy. During President Eisenhower Administration, his road and infrastructure bill cost $119 billion. FDR's New Deal for road and infrastructure cost $140 billion. Now, the messiah want to dump close to $700 billion to created jobs to rebuild our roads and bridges. Liberal pundits point out that it's important to prevent another bridge collapse like we saw in Minnesota.

Why all of a sudden that every roads and bridges are in desperate repair? The collapse in Minnesota was the states fault that they diverted monetary resources to be used for another state run program. I see construction on a daily bases on our road and bridges. Even though the reconstruction process is very slow, pouring money into this will not do anything besides pissing many drivers off.

This highway spending is a joke and a myth. This so-called 48,000 new jobs creation is just a smokescreen.

Nowhere is the government spending stimulus myth more widespread than in highway spending. Congress and the messiah are already salivating to push billions in highway spending once Obama takes power. For the past several decades, Liberals in Capitol Hill have repeatedly supported their idiotic claim that highway spending is an immediate economic cure. A proposed study, which Liberals and Obama are basing as fact, came from the Department of Transportation stating that every $1 billion spent on highways adds 48,000 new jobs to the economy. This is the figure Obama has been pushing to get enacted.

But like all others, Obama does not give the full story and twist the contents for his expediency. There is one problem that Obama left out. The DOT study made no such claim. It states that SPENDING $1 billion on highways would REQUIRE 48,000 workers. But before the government can spend $1 billion hiring road builders and materials, it must borrow $1 billion from other sectors of the economy, which would then lose a similar number of jobs. In other words, Obama's highway spending is shifting jobs and income from one part of the economy to another. The only way $1 billion of new highway spending can create 48,000 new jobs is if the $1 billion appears out of nowhere. Therefore, this highway spending will give a total negative net effect or wouldn't do anything in improving the unemployment figures.

If you look at the April 2008 DOT update, its reduced the employment figure to 35,000 jobs supported by each $1 billion spent on highways, and stated that the figures refer to jobs supported by highway investments, not jobs created.

Haven't we learned our lesson yet? It is a fact that highway spending has a poor track record of stimulating the economy. When Reagan inherited Carters double digit unemployment, he poured billions of dollars in highway spending. I found an audit by the Government Accountability Office (GAO) stating that highway spending generally failed to create a significant number of new jobs.

To be more accurate, Obama should have said that once the resulting improvements in the nation's infrastructure is completed, only then we may see an increase future job productivity and growth. This is not the same as suggesting that the act of spending money on additional highway workers and materials is itself an immediate stimulant. This can only work if politicians will allocate money to necessary highway projects rather than wasteful pork.

This immature mindset is beyond insulting our intelligence. I just wish Obama and the politicians in Capitol Hill just come out clean and tell us the truth. Using class warfare as their weapon is a weak argument to get a point across. Only the feeble mind will be dupe by empty promises. That is why educating ourselves about the truth will ultimately lead to personal freedom.