Today’s long lag between the conception and execution of infrastructure projects is one reason they are dubious as countercyclical economic stimulants and as jobs programs for the unemployed. The economist Milton Friedman said that once, while he was taken to see a canal that was being dug, he expressed astonishment that there was no heavy earth-moving machinery, only men with shovels. A government official said that was because the project was a jobs program. Well, then, Friedman replied, shouldn’t they use spoons rather than shovels?
New Deal public works gave the nation splendidly useful engineering marvels, including the Golden Gate Bridge and the Hoover Dam. It did not, however, significantly reduce unemployment, which never fell below 14 percent until prewar military spending began.
Both presidential candidates endorsed huge increases in infrastructure spending, so we are about to relearn that bipartisanship, whatever its many merits, usually means a recklessly open spending spigot. Will there be wasteful projects? Indeed, boondoggles are transaction costs of democracy. As is the inclination to direct infrastructure spending to stagnant regions, where it is unlikely to stimulate growth, rather than to regions where economic dynamism is putting pressure on, and being dampened by, inadequate infrastructure.
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