Wall Street Journal -  August 28, 2007

COMMENTARY 
 

Road Work

 

wo years ago, as floodwaters overcame the tired defenses of New Orleans, American cities got a wake-up call about the dangers of inadequate infrastructure. But most urban leaders went back to sleep. Since then the occasional disaster, such as the recent bridge collapse in Minneapolis, has been followed by tut-tutting. But if history is a guide, the rhetoric will be followed by another tap of the snooze button.

Rather than deal with the expensive and difficult task of retrofitting the sinews of commerce and communication — bridges, tunnels, roads, rail lines, ports, sewers, and drainage systems — America's urban powers focus on the ephemeral and the glitzy. They emphasize not brick and mortar, but sports stadia, convention centers, arts palaces, dubiously effective new light-rail lines, hotels and condo projects.

Even in New Orleans, federal and local authorities still have not agreed on a long-term infrastructure plan to protect the city. More disturbing: Instead of looking to rebuild a diverse economy, the emphasis is on cultivating tourism and "culture-based" industry. Incredibly, as the Times Picayune recently reported, "neglect" of the once-vital local energy sector has actually worsened since Katrina. The long-term exodus of energy firms to Houston, along with high-paying blue- and white-collar jobs, continues apace.

The new big idea seems to be a publicly subsidized, $1 billion Riverfront development to lure the much ballyhooed "creative class" to what the developer calls "America's most soulful city." The pitch suggests that "the role of great cities of the world is shifting from places where you must go, for a job, to places where you wish to spend time."

Reinventing New Orleans as a mildly raucous, hipper Disney World could spark a renaissance of sorts. But it offers scant hope for many middle-class families who fled the real city two years ago. Last year, Mayor Ray Nagin predicted that the population would reach 300,000 by the beginning of 2007, compared to 455,000 pre-Katrina. Today, the estimated population is 273,000. Many of the newcomers appear to be Hispanics, who have come to take jobs in construction and in the reviving tourist industry.

Some evacuees I spoke to are not impressed with the new vision. "They want to build a shining city on a hill," says former New Orleanian Sherby Guillory, a health-care worker and now a Houston resident, "but without the people."

Instead of returning, many evacuees — including teachers, businesspeople, health-service workers and the working poor — appear likely to stay in Atlanta, Houston, or Dallas, where there are prospects for middle-class job-seekers and their families. These cities, particularly the Texas ones, have made significant investments in new roads, airports and waterways.

Lack of broad opportunities was the most-often cited reason by evacuees in Houston for not returning to the place they all consider home. "[Houston] is a place where people go to get ahead," says Crystal Walker, a native of New Orleans and a former student at predominantly African-American Southern University. "New Orleans — it will always be my first love — but there are better opportunities here for my kids."

The ultimate question here is that of priorities. Yes, artists and cultural institutions have always been hallmarks of great cities. But underpinning that efflorescence since the earliest times has been critical commitments to such mundane things as water systems, canals, dikes and protective walls — the economic infrastructure that supports the rest.

Hollywood might portray ancient Rome as decadent parties, gladiatorial combat and magnificent art, but Romans knew what made their city tick was the spectacular, and very practical, engineering works, from roads and bridges to water systems. In the first century A.D., Roman writer Frontinus pointed to Greek boasts of what he called their "useless" art, and to Egypt's legacy of "idle Pyramids," and then asked: What are these compared to the 14 aqueducts that bring water to Rome?

Today's all-circuses-all-the-time urban leaders relegate the basics to the back row. Examples of neglected essential support systems abound: Roughly 80% of state transportation officials, according to one recent survey, admit that their 10-year plans will "not meet needs" of the current networks, even though 97% of roads, bridges and tunnels, and 88% of transit systems, will need considerable updating. The American Society of Civil Engineers says that $1.6 trillion must be spent over the next five years to prevent further deterioration. Only $900 billion is now earmarked.

Energy infrastructure? Between 1975-1999, the U.S. spent on average just $83 million per year on power lines and facilities to deliver electricity to end users. Since 1999, increases in transmission spending have been enough to meet just one-third of new demand. Thus many regions have experienced prolonged blackouts and brownouts, including New York, St. Louis and parts of California.

Throughout the 19th century, internal improvements — turnpikes, canals, railroads — connected the Atlantic coast with such emerging metropolises as Buffalo, Toledo and Chicago. These improvements, observed historian Alfred Chandler, allowed firms faster and more reliable shipment of goods across America's vast landmass. Progress continued right through the Interstate Highway System begun in the Eisenhower years. Unlike trains, the highways provided great flexibility.

Although detested by many of today's leading urbanists, the highway system allowed firms and individuals to spread more efficiently into the suburban periphery and into rural areas, creating the modern, dispersed multipolar metropolis. By some estimates, it has also returned more than six dollars in increased productivity for each dollar invested. According to one federal study, it has brought an estimated $1 trillion in producer cost reductions.

Modernizing the nation's infrastructure, as we move towards a nation of 400 million by 2050, will mean much more than simply maintaining and expanding publicly financed airports, roads and waterways. There is room for innovation, using new telecommunications technology, flexible, cost-efficient rapid transit, toll roads and a generally more imaginative role for private-sector investment.

But there is as yet little apparent appetite for this. Governments prefer subsidizing high-profile but marginally effective boondoggles — light-rail lines, sports stadia, arts or entertainment facilities, luxury hotels and convention centers.

Over the past decade, according to a recent Brookings Institution study, public capital spending on convention centers has doubled to $2.4 billion annually; nationwide, 44 new or expanded centers are in planning or under construction. But the evidence is that few such centers make money, and many more lose considerable funds. The big convention business is not growing while the surplus space is increasing. New sports centers add little to the overall economy.

Critically, misguided investments shift funds that could finance essential basic infrastructure. Pittsburgh has spent over $1 billion this decade on sports stadia, a new convention center and other dubious structures. Heralded as major job creators and sources of downtown revitalization, they have done little to prevent the region's long-term population loss and continued economic stagnation. Much the same can be said of Milwaukee's new Santiago Calatrava-designed Art Museum, or Cleveland's Rock and Roll Hall of Fame.

Transportation priorities are also skewed. Government officials in Minnesota spent mightily on a light-rail system that last year averaged barely 30,000 boardings daily. It did not focus nearly as much on overstressed highway bridges, or the bus systems serving the bulk of its mostly poor and minority transit riders. Most other light-rail systems, built in cities with highly dispersed employment, also have minuscule ridership, but consume a disproportionate share of transit funds that might go to more cost-efficient systems, including bus-based rapid transit.

New York's infrastructure spending over the past decade, according to the City Controller's office, has been roughly half what is necessary to maintain and repair what is already there. Even as Mayor Bloomberg talks boldly of a new Penn Station or a Second Avenue subway, much of the city's subway, road and bridge system has been in disrepair and subject to sporadic service disruptions for at least a generation.

California, with its still rapidly growing population, is falling even further behind. The fraction of the state budget allocated to infrastructure, according to the California Infrastructure Commission, has dropped to barely 3% today from 20% in 1960. The state's highways and inner-city buses grow ever-more crowded, while its electrical and water systems are increasingly anachronistic and disaster-prone.

This brings us back to Katrina. Cities that want to grow their economies and maintain their middle classes need to be more than simply places for a good time, or feel-good but often low-performing light-rail projects. They need to address basic needs like roads, bus transportation, electricity and water.

Nevertheless, few politicians seem interested in a coherent "back to basics" infrastructure investment strategy, except as a potential opportunity for pork-barrel spending. Until they are, we can look forward to more natural disasters, bridge collapses, subway malfunctions and power shortages. What happened in New Orleans two years ago could become not the exception, but the emblem of a troubled American future.

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