Obama's Bridge To Nowhere

It's mid-term election season, and promises are in full swing. Talk is stirring of a second stimulus effort, even though politicians dare say the word. Instead President Obama is pushing for a $50 Billion infrastructure bank, in which the federal government will award grants and contracts to encourage construction to revamp highways, tracks, runways, airports, and building projects. Following the sluggish response of the first failed stimulus, there is little hope for this one. However, now is the best opportunity to correct the past mistakes.

If President Obama goes by the coined phrase of an infrastructure bank, the government should be focused solely on investment, seeking a positive return. Banks don't necessarily provide grants, but they surely will award a contract to a construction company to make their investment plan come into fruition - it's the creation of an asset in which the investment of a "grant" adds to the cost, in hopes of generating enough revenue to offset the expense of labor. A stimulus that runs by this mentality has a better chance of success.

According to the ProPublica Recovery Tracker, most of the stimulus money produced no jobs, and some states lost jobs. Now, it's not fair to make this correlation without doing heavy statistical analysis, but the data shows that the stimulus did not do enough to help boost employment.

I decided to zero in on the Bronx to craft an action plan. My home town is the only borough that is physically connected to the mainland of NY state. This means that it serves as a major transportation route, yet still faces a lot of economic problems. The public transportation routes that connected the city and upstate NY to the Bronx gave birth to the suburban feel of the north Bronx as many city dwellers chose to relocate and commute elsewhere to work. As time passed, the Bronx became host to many residents who chose to seek area employment, which was scarce and mainly consisted of small businesses. This gave rise to a major public housing development in response to a decrease in economic productivity.

Robert Moses helped revamp NYC after the great depression with major infrastructure projects such as the Tri-Borough-Bridge and Cross Bronx Expressway. He did so remaining in the private sector, using government contracts, and continued to reinvest revenue derived from tolls and real estate projects. It was an amazing re-birth for NYC, but critics worry that the focus on vehicle transportation took away from investments in public transportation. Also, many snub the Cross Bronx Expressway as an eye-sore that caused neighboring communities to turn into slums under the freeways. The externalities of NYC infrastructure can be corrected through better investment, using the assets that are already in place.

On Recovery.gov, the Bronx is shown receiving little stimulus funds compared to the rest of the city and state. Most of the funds were distributed to charter schools, churches, and hospitals. For example Montefiore Hospital, the biggest employer in my area, received $183,000 for medical research on Lukemia, but added zero jobs. It's certainly a failure of local representatives who were given the responsibility to invest stimulus funds. This money could have been used to encourage nursing training, day care centers at the children's hospital throughout the Montefiore campuses in the north Bronx. This would have eased the financial troubles for many single parents, most of whom I know back home, while providing an incentive to get back to work. Of course, a council member will know this if he/she took the time to survey the district you represent.

Let's look at infrastructure. The Cross-Bronx-Expressway is an eye-sore. Currently, no contract is awarded, not even a bidding request to improve this decaying transportation line. It's crumbling facade is in desperate need of a face-lift. Lanes to separate trucking from car traffic, along with ramps to the community below will provide an added bonus. Exits off of the expressway will contribute to the storage businesses already in the area, local trucking companies, warehouses, manufacturers etc. Easing the commute on cars, many of which bypass the Bronx completely during their commute from upstate into the city. Building the area community by converting empty lots to high-rises and commercial office space will attract businesses and residents looking to move closer to their employees. Bronx residents will actively be involved and become recipients of this investment process.

In sum, President Obama needs to seriously think about this second spending push. The construction is short term. Companies that are awarded a contract will first use the current staff (not boosting any new employment) or employ new workers, only to complete the task and return to handing out pink slips until they find a new project. If this money is invested, the long term growth of areas surrounding the improved infrastructure will become an engine of productivity.

New railroads are only good if utilized by the transportation companies, many of whom are struggling because of the unproductive economy. Get to the heart of the problem. Drilling activity, instead of moratoriums, will better the use of railroads transporting coal. Container shipments throughout the US using more rail lines, improving access, lowering cost, increasing revenues. These common sense ideas need the involvement of local businesses and government officials.