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Why Obama's Futurama Can Wait: Schools and Hospitals Should Come First in Any Stimulus Package

by: Mike Davis  |  TomDispatch.com

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Part of Obama's education plan is to provide tuition in exchange for community service. (Photo: CJ Gunther / USA TODAY)

    America's "Futurama" is defunct. The famous walk-through diorama of a car-and-suburb world, imagineered by Norman Bel Geddes for General Motors at the 1939 New York World's Fair, has weathered into a dreary emblem of our national backwardness. While GM bleeds to death on a Detroit street corner, the steel-and-concrete Interstate landscape built in the 1950s and 1960s is rapidly decaying into this century's equivalent of Victorian rubble.

    As we wait in potholed gridlock for the next highway bridge to collapse, the French, the Japanese, and now the Spanish blissfully speed by us on their sci-fi trains. Within the next year or two, Spain's high-speed rail network will become the world's largest, with plans to cap construction in 2020 at an incredible 6,000 miles of fast track. Meanwhile China has launched its first 200 mile-per-hour prototype, and Saudi Arabia and Argentina are proceeding with the construction of their own state-of-the-art systems. Of the larger rich, industrial countries, only the United States has yet to build a single mile of what constitutes the new global standard of transportation.

    From day one, Barack Obama campaigned to redress this infrastructure deficit through an ambitious program of public investment: "For our economy, our safety, and our workers, we have to rebuild America." Originally he proposed to finance this spending by ending the war in Iraq. Although his present commitments to a larger military and an expanded war in Afghanistan seem to foreclose any reconversion of the Pentagon budget, he continues to emphasize the urgency of an Apollo-style program to modernize highways, ports, rail transit, and power grids.

    Public works, he also promises, can put the public back to work. His "Economic Rescue Plan for the Middle Class" vows to "create 5 million new, high-wage jobs by investing in the renewable sources of energy that will eliminate the oil we currently import from the Middle East in 10 years, and we'll create 2 million jobs by rebuilding our crumbling roads, schools, and bridges."

    Of course, Bill Clinton entered the White House with a similarly ambitious plan to rebuild the derelict national infrastructure, but it was abandoned after Treasury Secretary Robert Rubin convinced the new president that deficit reduction was the true national priority. This time around, a much more powerful and desperate coalition of interests is aligned to support the Keynesian shock-and-awe of major public works.

    Rolling Out the Dozers

    Since the Paulson bailout plan has become so much expensive spit in the wind, and with bond spreads now premised on the possibility of double-digit unemployment over the next 18 months, massive new federal spending has become a matter of sheer economic survival. As innumerable influentials - from New York Times columnist David Brooks to House Majority Leader Nancy Pelosi - have argued, a crash program of infrastructure repair and construction, likely to include some investment in the new power grids required to bring more solar and wind energy online, is the "win-win" approach that will garner the quickest bipartisan support.

    It has also been portrayed as the only lifeboat in the water for the ordinary steerage passengers in our sinking economy. The emergent Washington consensus seems to be that those five million green jobs can actually come later (after we save GM's shareholders), but that infrastructure spending - if resolutely pushed through the lame-duck Congress or adopted in Obama's first 100 days - can begin to pump money into the crucial construction and manufacturing sectors of the economy before the end of next winter.

    Unlike Comrade Bush's "socialist" efforts to save Wall Street, a public-works strategy for national recovery has had broad ideological respectability from the days of Alexander Hamilton and Abraham Lincoln to those of Franklin D. Roosevelt and John F. Kennedy. If Democrats can brag about the proud heritage of the Works Progress Administration and the Public Works Administration from the era of the Great Depression (ah, those magnificent post offices and parkways), there are still a few Republicans who remember the Golden Age of interstate highway construction that commenced in the 1950s with President Dwight D. Eisenhower. Indeed since the national shame of Hurricane Katrina, Americans have become outspokenly nostalgic about competent federal governments and magnificent public achievements.

    If one accepts the reasonable principle of supporting the new president whenever he makes policy from the left or addresses basic social needs, shouldn't progressives be cheering the White House as it rolls out the dozers, Cats, and big cranes? Aren't high-speed mass transit and clean energy the kind of noble priorities that best reconcile big-bang stimulus with long-term public value?

    The answer is: no, not at this stage of our national emergency. I'm not an infrastructure-crisis denialist, but first things first. We are now at a crash site, and our priority should be to save the victims, not change the tires or repair the fender, much less build a new car. In the triage situation that now confronts the president-elect, keeping local schools and hospitals open should be the first concern, rebuilding bridges and expanding ports would come next, and rescuing bank shareholders at the very end of the line.

    Inexorably, the budgets of schools, cities, and states are sinking into insolvency on a scale comparable to the early 1930s. The public-sector fiscal crisis - a vicious chain reaction of falling property values, incomes, and sales - has been magnified by the unexpectedly large exposure of local governments and transit agencies to the Wall Street meltdown via complex capital lease-back arrangements. Meanwhile on the demand side, the need for public services explodes as even prudent burghers face foreclosure, not to speak of the loss of pensions and medical coverage. Although the public mega-deficits of California and New York may dominate headlines, the essence of the crisis - from the suburbs of Anchorage to the neighborhoods of West Philly - is its potential universality.

    Certainly, in such a rich country, wind farms and schools should never become a Sophie's choice, but the criminal negligence of Congress over the past months should alert us to the likelihood that such a choice will be made - with disastrous results for both human services and economic recovery.

    Saving Schools and Hospitals

    Congress naturally loves infrastructure because it rewards manufacturers, shippers, and contractors who give large campaign contributions, and because construction sites can be handsomely bill-boarded with the names of proud sponsors. Powerful business lobbies like the National Industrial Transportation League and the Coalition for America's Gateways and Trade Corridors stand ready to grease the wheels of their political allies. In addition, if the past century of congressional pork-barrel methods is any precedent, infrastructural spending typically resists coherent national planning or larger cost-benefit analyses.

    Yet saving (and expanding) core public employment is, hands-down, the best Keynesian stimulus around. Federal investment in education and healthcare gets incomparably more bang for the buck, if jobs are the principal criterion, than expenditures on transportation equipment or road repair.

    For example, $50 million in federal aid during the Clinton administration allowed Michigan schools to hire nearly 1,300 new teachers. It is also the current operating budget of a Tennessee school district made up of eight elementary schools, three middle schools, and two high schools.

    On the other hand, $50 million on the order book of a niche public transit manufacturer generates only 200 jobs (plus, of course, capital costs and profits). Road construction and bridge repair, also very capital intensive, produce about the same modest, direct employment effect.

    One of the most likely targets for a Congressional stimulus plan is light-rail construction. Street-car systems are enormously popular with local governments, redevelopment agencies, and middle-class commuters, but generally they operate less efficiently (per dollar per passenger) than bus systems, and at least 40% of the capital investment leaks overseas to German streetcar builders and Korean steel companies.

    Personally, I would love to commute via a sleek Euro-style bullet train from my home in San Diego to my job in Riverside, 100 grueling freeway miles away, but I'll take gridlock if the cost of rationing federal expenditure is tolerating the closure of my kids' school or increasing the wait in the local emergency room from two to ten hours.

    Obama, unlike his predecessor, has a bold vision, shared with his powerful supporters in high-tech industries, of catching up with the Spanish and Japanese, while redeeming America as the synonym for modernity. Lots of new infrastructure will, however, become so many bridges to nowhere (especially for our children) unless he and Congress first save human-needs budgets and public-sector jobs.

    A good start for progressive agitation on Obama's left flank would be to demand that his health-care reform and aid-to-education proposals be brought front and center as preferential vehicles for immediate macro-economic stimulus. Democrats should not forget that the most brilliant and enduring accomplishment of the Kennedy-Johnson era was Head Start, not the Apollo Program.

    If, after saving kindergartens and county hospitals, we someday hope to ride the fast train, then we need to rebuild the antiwar movement on broader foundations. The president-elect's original proposal for funding domestic social investment through downsizing the empire offers a brilliant starting point for basing economic growth on an economic bill of rights (as advocated by Franklin Roosevelt in 1944) instead of imperial over-reach and Pharaonic levels of military waste.

    --------

    Mike Davis is the author of "In Praise of Barbarians: Essays Against Empire" (Haymarket Books, 2008) and "Buda's Wagon: A Brief History of the Car Bomb" (Verso, 2007). He is currently working on a book about cities, poverty, and global change.

  

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Comments

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How much 10 billion dollars

How much 10 billion dollars a month buy? use the money wasted in Irak to create work and hope for everyone.

No one could disagree--

No one could disagree-- certainly education and health care are foundational needs for a civilized and humane society to survive. The BIG THREE auto companies are panhandling Congress today to entrench the status quo via $25B, while they promise to behave in the future. The financial crisis affords an opportunity to politely twist the arms of these companies' CEOs to "allow" them to re-create the transit infrastructure their direct forebears dismantled in the early 1950's. That should be a condition of continuing in their roles. These companies have profited wildly from an immoral free ride, marketing hyper-consumption long after it was well known that continuation of our oil-consuming habit was a very dead end. They deserve no mercy. And, yes, the rest of us folks deserve better.

P.S. Why do you live 100

P.S. Why do you live 100 miles from work???

I would like to point out

I would like to point out that modernizing the infrastructure means jobs, jobs means money, money. If you spend money on infrastructure, this is for the most part money spent at home rather than abroad. (ok, some of the parts might come from abroad, but it's installed and used here rather than there). Modernizing mass transport means research and development which is also done at home which means education and jobs. Better more efficient transportation means bringing down the cost of transportation in the long run reducing costs and pollution. It also means increased safety and reliability which means a smoother running society. It's short sighted to say we must solve the education problem first before the infrastructure problem. There will always be these problems. We must not put one aside for the other because they are intricately linked. Though many people thought going to the moon was completely a useless endeavor, it had huge ramifications which we benefit to this day.

I am a Democrat and ardently

I am a Democrat and ardently in favor of change regarding our energy and transportation system, But, I had a hard time getting past the sensational 1st paragraph. We all know we need to make changes. Writing ridiculously about it isn't necessary.

Why are we bound to waste

Why are we bound to waste lives in Afghanistan, Iraq and other countries when we know that is nothing more than an exercise in futility, leading to yet another dead end. For what ? Oil profits to the oil companies and still the high prices to the consuming public ? Not to mention the hatred of the rest of this world for our actions. I say bring our Military home and put them to work rebuilding our highways, bridges, etc. We need a world class Train System that will cut out the necessity for the wars and killing, in order to take from other lands what we are lacking in ours. No wonder this Oil Company President and his oil cronies do not want a great train system to be built. That would cut out the exorbitant profits they Enjoy at the expense of our blood and tears wasted on senseless wars. Not to mention the necessity of paying their unconscionably extortionist prices due to their monopoly on our major means of transportation--our automobiles. This is a high price to pay considering the many Thousands that are killed and maimed on our Highways every year..year after year. How can anyone continue to ask our God To Bless Our Country when we are directly responsible for the killing of well over a Million innocent Iraqis and Thousands of our own young men and women! For what ? So we can continue to fill the coffers of the greedy and power hungry People on Wall Street and the Oil Companies ? This contrived need is for the sole purpose of extending the NWO that the Bushes have so sought for all their lives. We must Insist on President-elect Obama doing an about face and putting our Country and the needs of the American people first. We know that is the only right course to take. Force our Government to do the will Of the People For the people. We deserve no less. Until this is done there will be no recovery..either Economic or in the Opinion and good Will of the rest of the world. It is up to us to Demand this to be done.

Are you the same Mike Davis

Are you the same Mike Davis who wrote "City of Quartz"? Great book, but kind of over the top...

We had a lot of spare cash

We had a lot of spare cash before the year 2000. And we spent it on what? I don't know either. But it surely was not the superstructure and school teachers were still on strike. Will the Army conduct operations primarily from rail? Remember for whom the road tolls? Yes, the military is the primary user/owner of all fed highways. We are soon to face the choice between building up the world or the earth. The earth needs no roads. The economy will become survival based within our lifetimes. That means a healthy earth over a healthy world. Technotopia will become just another dream to awaken from.

There is a difference

There is a difference between Investments and Spending. Spending on education and health care has benefits very far down the road but it is spending never the less. Investments are a totally different kind of spending. Besides creating the potential for increased future earnings, they have a high multiplier effect. Direct investments in infrastructure or energy have a multiplier of at least 5-6. This means $50mln invested create at least $250-300mln in knock on investments. This is a long standing economic fact! Investments in energy will reduce the amount of money we send to other countries. This reduces the trade/current account deficit and keeps or creates jobs in the USA. If anybody wants to rebuild the nation from the bottom up then investments in infrastructure and energy are the way to go. Energy is absolutely critical. The latest IEA report is outright frightening. We are at peak of conventional oil production and current production levels can only be maintained or increased with a massive $26trillion investment over the next 22 years. I think this outlook is far too optimistic and energy investments are the most crucial investments for a relatively secure future! Energy is absolutely critical because current low prices can and will not last!!!