Why an Infrastructure Jobs Bank Won’t Work

One of the core proposals President Obama will make to Congress this week is the creation of an infrastructure bank that will provide funds to repair tens of thousands of miles of U.S. roads and bridges. It will, like any other large government program that seeks to solve problems nationwide, face the same kind of bureaucracy that made past programs, like the 2008 stimulus and TARP, ineffective or unmeasurable.

It is relatively easy to assume that an infrastructure bank would require applications from private construction firms. These companies would need to get permits to work on highways and bridges. The construction also would have to be done to local or federal specifications, which is another part of the chain to initiate a project. Workers can be hired at that point. That process, and the additional job of finding and financing equipment in some cases, could add several more months to job creation. In all, it would not be unfair to assume, the effects of the work of an infrastructure bank may not be felt for more than a year.

Unfortunately for the economy, and those out of work, there are 14 million unemployed people in the U.S., and nearly half of those out of work have been so for over half a year. It is impossible to judge how many of these people have the skills needed to work on construction crews. Probably not many. And, training those who are untrained and moving them to the locations where they can work would be challenging.

Other plans the Administration will propose to increase hiring and consumer spending have only been rumored. The most likely of these is tax cuts for the middle class. If the extension of Bush tax cuts is an indication, Americans are as likely to pay bills or save as they are to go on shopping sprees.

Without a plan that will encourage businesses to add jobs immediately, the unemployment situation will get worse as increasing numbers of people move into the category of the long-term jobless who have begun to run out of financial resources altogether.

Douglas A. McIntyre