Why Does U.S. Build Roads If It Can’t Pay to Fix Them?

April 6 (Bloomberg) -- A number of years ago in Cambridge, Massachusetts, a young friend from Germany turned to me and commented on the potholed and patched streets that surrounded us, as well as the uneven sidewalks and assorted other rough edges.

“It looks like a Third World country here,” he said. “Apparently no one cares.” To him, it was amazing that the wealthy and well-educated residents of Cambridge would tolerate such a poor public environment.

Yet in the U.S. this is more the rule than the exception. Many cities, of course, are in much worse shape than Cambridge.

Last week, Congress approved an emergency stopgap transportation-spending bill, which will give the House and Senate more time to argue over the shape and size of a long-term transportation bill. Although these debates are important, they distract from the reality on the ground, which is that much of our common infrastructure is falling apart from lack of basic maintenance.

Occasional disasters focus attention on the problem -- the near liquidation of New Orleans because of inadequate and poorly maintained levees, or the collapse of a freeway bridge in Minneapolis -- but, in general, the state of disrepair is so common that we simply accept it.

Low Grades

Even getting a handle on the problem is difficult. The American Society of Civil Engineers in its well-known Report Card for America’s Infrastructure gives the U.S. an overall grade of D and says there is a $2.2 trillion deficit -- the amount of money it would take in five years to bring the country’s public works up to acceptable levels. Much of this estimate is for simple maintenance.

Now, asking a bunch of civil engineers about public-works spending is like asking the barber if you need a haircut. Still, the organization’s work is impressive. It attempts a comprehensive assessment of needs in 10 categories, from aviation to wastewater.

You don’t need an engineering degree to see that many U.S. roads, train lines, bridges, sewers and water systems are less spiffy than in other advanced countries. Some national systems, like the interstates, look pretty good. Local streets, bridges, sidewalks, train stations, water tunnels and the like seem to be in the worst shape.

To some extent, these cracks in our infrastructure -- or public works, to use the meatier and older term -- reflect the cracks in our government. Under the American system, which is based on the English model, authority is separated among not only federal, state and local, but among independent public authorities, as well as private utility companies.

City Hall may be nominally in charge of Main Street, but private companies for phone, gas, electric, cable and Internet service are the ones tearing up the street. These companies often don’t make good street repairs their highest priority. Infrastructure authorities with huge responsibilities can end up as political orphans through accidents of history.

North Carolina is unusual. It has some of the best-looking roads in the country because the state transportation department owns almost all of them. This is a legacy of the Great Depression, when the state took over local roads from bankrupt counties and cities that could no longer afford to maintain them.

Building, Not Maintaining

A challenge generally is that states and localities, unlike the federal government, make a firm distinction between operating and capital expenditures. You can borrow money to build a road, but not to maintain it. This leads to a subtle -- make that not so subtle -- bias against maintenance spending.

“See those lights,” a transit manager in a major American city told me during a tour of an open-air train station, pointing to some bulbs in rusting metal frames hanging over the platform. “It would only cost about $1,000 a year to maintain those well. We can’t get that. So instead, we will wait until they rust out and fail completely. Then we will replace them, at a cost of perhaps $100,000.”

This is poor governance and economics. “Every dollar spent in keeping a good road good precludes spending $6 to $14 to rebuild one that has deteriorated,” says William Reinhardt, editor of the newsletter Public Works Financing. “Maintenance budgets are one of the first places mayors and governors look for money to fill budget shortfalls.”

Then there is the American anti-government predilection. We look at government as something outside ourselves, rather than a reflection of us. So a fancy new City Hall building can become a symbol of waste, rather than something everyone can be proud of. Politicians pick this up, and while they like their names on public works, some have become loath to spend any of their constituents’ money on anything that makes a structure look good. Architects and civil engineers have told me of something being cut out of a public project because it “looks expensive.” Sometimes one of these features might even save money, but that doesn’t matter.

There are assorted remedies to this problem, although none are magic bullets. Tom Downs, a former president of Amtrak and New Jersey transportation commissioner, and now a senior official with Veolia Transportation, said that one start would be to have a “depreciation account,” as many businesses do. That way, government would see what needed to be funded. Another way is to have annual reports on the status of highways, streets, utilities, schools, fire stations and so forth.

Head-Count Obsession

“We have let the issue disappear from view,” Downs said. “It is our own fault if things are falling apart, because we do not measure it.”

Al Appleton, a former commissioner of environmental protection and director of water and sewer systems in New York, said politicians and the press focus inordinately on the “head count” in government, without seeing the savings and better efficiency that are gained through adequate staffing levels. When he was commissioner in the early 1990s, he said he won increased staffing for the department’s “dewatering” process for sludge, which is essentially squeezing more water out of waste matter. The added resources saved $20 million annually in shipping charges, he said, far more than the cost of the extra workers.

“You can’t fight a war without an army,” Appleton said. “To do maintenance right, you need people.”

Much of this is contrary to the public discussion of infrastructure. We see highway crews loafing, and instantly jump to assumptions that all government is overstaffed. And our obsession with spotting and eliminating “pork” can get in the way of making sure that what we build is built right, and kept that way.

Beyond all these things, rising standards would help. We should expect our streets to shine, and if they don’t, we should hold the politicians responsible.

(Alex Marshall is a senior fellow at the Regional Plan Association in New York and author of the forthcoming, “The Surprising Design of Market Economies.” The opinions expressed are his own.)

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