News / USA

Panel Considers Bank to Promote Investment in US Infrastructure

Multimedia

A U.S. Senate panel is looking at ways to help spur investment in roads, bridges and other costly public projects.  The US currently spends less on infrastructure projects than most developed countries.  One idea that appears to be gaining traction is the president's proposal for the creation of a national infrastructure bank.  

On expensive infrastructure projects, the US spends less than most countries:  only about two percent of Gross Domestic Product, compared to five percent for Europe and nine percent for China.

Senator John Kerry warns without additional investment, the US will lose its competitive edge.

"Rising economic powers around the world - our competitors China, India, Brazil, Mexico, other countries - are all investing in their future," said John Kerry. "And they're all investing in their future much more significantly than the United States.  The truth is, we are moving at our current rate towards a secondary competitive status, because of our inattention to the infrastructure of our country."

One of the options before the Senate Banking Committee is a $50 billion fund to create a bank that would pool private and public resources to upgrade the nation's aging roads, railways and airports.

Treasury Department chief economist Alan Krueger says that investment makes good economic sense.

"Infrastructure investment will provide opportunities for workers who were disproportionately affected by the recession," said Alan Krueger. "Due to the collapse of the real estate market the contraction of employment in the construction industry has been especially acute."

One in five of the eight million jobs lost during the recession was in construction, which has an unemployment rate nearly twice as high as the national average.  

While most lawmakers on the panel were receptive, Montana Senator Jon Tester expressed concerns that smaller communities would not be able to compete.

"How does Montana get a fair shot at any sort of investment when quite honestly we don't have a population base that's the size of a place like Pittsburgh, much less a bigger city or a bigger state?" asked Jon Tester.

Still, others, like senior Republican Senator Richard Shelby, fear the proposal would create another Government Sponsored Enterprise (GSE) that puts public funds at risk.

"I fear that the bank will simply be a new GSE or something like it and we will face another Fannie [Mae] and Freddie [Mac] type entity that will cost taxpayers money down the road," said Richard Shelby.

But Pennsylvania Governor Ed Rendell argues that partnering with the private sector helps reduce the risk.

"In fact, the bank, because it will leverage private sector investments in most cases, I think you will see a higher scrutiny on projects because the private sector is interested in the rate of return, and for the rate of return to be successful, the project has to be successful, so you'll not only have some level of government oversight, but you'll have the investor oversight as well," said Ed Rendell.

The National Infrastructure Bank, also called I-bank, would use private, state and local capital to fund infrastructure projects without the normal red-tape from Congress.   

The Congressional Budget Office, which reviews the fiscal implications of US legislation says infrastructure spending is one of the most effective policy options for reducing the nation's high unemployment rate.

You May Like

Video British Fighters on Frontline of Islamic State Information War

It’s estimated that several hundred British citizens are fighting for Islamic State alongside other foreign jihadists More

Pakistan's Political Turmoil Again Shines Spotlight on Military

Thousands of protesters calling for PM Sharif to step down continue protests in front of parliament, as critics fear political impasse could spur another military coup More

Photogallery Ebola Quarantines Spark Anxiety in Liberian Capital

Food prices rise sharply as residents attempting purchases clash with security forces, leaving one person dead More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Native Bees May Help Save Cropsi
X
Deborah Block
August 22, 2014 12:23 AM
U.S. President Barack Obama has called for a federal strategy to promote the health of bees that have been declining. The honeybee has been waning due to parasites, disease and pesticides. Wild bees may be used to take over their role as crop pollinators. Scientists first need to learn a lot more about wild bees, says biologist Sam Droege, who is pioneering the first national inventory on native bees. VOA’s Deborah Block went to his research laboratory in Beltsville, Maryland, to bring you more.
Video

Video Native Bees May Help Save Crops

U.S. President Barack Obama has called for a federal strategy to promote the health of bees that have been declining. The honeybee has been waning due to parasites, disease and pesticides. Wild bees may be used to take over their role as crop pollinators. Scientists first need to learn a lot more about wild bees, says biologist Sam Droege, who is pioneering the first national inventory on native bees. VOA’s Deborah Block went to his research laboratory in Beltsville, Maryland, to bring you more.
Video

Video US Defense Officials Plan for Long-Term Strategy to Contain Islamic State

U.S. defense officials say American air strikes in Iraq have helped deter Islamic State militants for the time being, but that a broad international effort is needed to defeat the extremists permanently. Defense Secretary Chuck Hagel warned Thursday that the group formerly known as the Islamic State in Iraq and the Levant, or ISIL, is better organized, and financially and militarily stronger than any other known terrorist group. Zlatica Hoke has more.
Video

Video Drug-Resistant Malaria Spreads in Southeast Asia

On Thailand’s border with Myanmar, also known as Burma, a malaria research and treatment clinic is stepping up efforts to eliminate a drug-resistant form of the parasite - before it spreads abroad. Steve Sandford reports from Mae Sot, Thailand.
Video

Video Gaza Conflict, Hamas Popularity Challenge Abbas

The Palestinian unity government of Mahmoud Abbas has failed to convince Hamas to agree to Egyptian-negotiated terms with Israel on a Gaza cease-fire. VOA State Department Correspondent Scott Stearns reports on what the Gaza conflict means for President Abbas, with whom U.S. officials have worked for years on a two-state solution to the Israeli-Palestinian conflict.
Video

Video Nigeria's 'Nollywood' Movie Industry Rolls in High Gear

Twenty years after its birth in a video shop in Lagos, Nigeria's "Nollywood" is one of the most prolific film industries on earth. Despite low budgets and whirlwind production schedules, Nigerian films are wildly popular in Africa and industry professionals say they hope, in the future, their films will be as great in quality as they are in quantity. Heather Murdock has more for VOA from Lagos.
Video

Video UN Launches 'Biggest Aid Operation in 30 Years' in Iraq

The United Nations has launched what it describes as one of the biggest aid operations in 30 years in northern Iraq, as hundreds of thousands of refugees flee the extremist Sunni militant group calling itself the Islamic State. As Kurdish and Iraqi forces battle the Sunni insurgents, the fighting has forced more people to flee their homes. Kurdish authorities say the international community must act now to avert a humanitarian catastrophe. Henry Ridgwell reports for VOA from London.
Video

Video Cambodian American Hip Hop Artist Sings of Personal Struggles

A growing underground movement of Cambodian American hip hop artists is rapping about the struggles of living in urban America. Most, if not all of them, are refugees or children of refugees who came to the United States from Cambodia to escape the Khmer Rouge genocide of the 1970s. Through their music, the artists hope to give voice to immigrants who have been struggling quietly for years. Elizabeth Lee reports from Long Beach, California.
Video

Video African Media Tries to Educate Public About Ebola

While the Ebola epidemic continues to claim lives in West Africa, information technology specialists, together with radio and TV reporters, are battling misinformation and prejudice about the disease - using social media to educate the public about the deadly virus. VOA’s George Putic has more.

AppleAndroid