clean energy & infrastructure
Excerpts from Center for American Progress' report:
"Building a Progressive Infrastructure"
How Infrastructure Investments Can Create Jobs, Strengthen Communities, and Tackle the Climate Crisis
Infrastructure is the foundation that makes the economy possible, shaping how Americans move, communicate, and earn a living. It is also essential to national competitiveness. When done right, infrastructure investments produce broad-based prosperity for American workers, facilitating social mobility and access to jobs, essential services, educational opportunities, people, and ideas.
Unfortunately, this social and economic foundation is crumbling. The American Society of Civil Engineers (ASCE) gives the United States an overall infrastructure grade of D+, estimating a more than $2 trillion funding gap between needs and expected spending by all levels of government over the next 10 years. This gap is troubling, because inadequate facilities drag down economic productivity—especially in growing, dynamic regions. Many smaller communities struggle to repair crumbling older facilities, pushing out businesses and creating a downward spiral of population loss and a reduced tax and revenue base.
At the same time, the global scientific community has reached a consensus that transformational change is needed to rapidly decarbonize the economy in order to avoid the most catastrophic consequences from climate change. The International Panel on Climate Change estimates that the world has a little more than a decade to take decisive action.
Historically, infrastructure and protection of the environment have been treated as separate, with the former a foundational element of economic production and the latter an amenity—something nice to have but incidental to the economy and economic issues of wages, growth, and competitiveness. The increasing severity and frequency of catastrophic wildfires, droughts, floods, and hurricanes have laid waste to this false dichotomy. In truth, the economy and the environment are intricately linked and mutually reinforcing. Infrastructure investments not only facilitate growth, but they also affect the production of greenhouse gases and other harmful pollutants in both direct and indirect ways. Infrastructure investments should help the United States transform its economy away from fossil fuels and toward clean energy.
In addition, Congress should ensure that investments expand access to opportunity, raise wages, and improve job quality for millions of working Americans, as well as help rebuild communities left behind. Even as the overall unemployment rate has fallen, many workers have not received a pay increase in inflation-adjusted terms since the 1970s. By comparison, corporate profits have soared over that same period of time. During 2018, real corporate earnings increased by more than 16 percent while average wages for workers rose by a meager 0.2 percent.
There is a long-overdue need for major new federal investments in infrastructure—but increasing federal spending alone is not enough. To ensure the benefits of federal investments are shared broadly, an infrastructure bill should include policies designed to protect labor rights; fight workplace discrimination; set high standards for wages and benefits; and support high-quality training and apprenticeships. Additionally, federal funds should be targeted to those communities facing the greatest need as well as redress the unequal burden of pollution and geographic isolation that neglectful and discriminatory investment policies and projects cause.
The best opportunity to meaningfully address these challenges is a comprehensive package of national infrastructure investments designed to raise wages, rebuild struggling communities, and achieve a greenhouse gas reduction target. A federal infrastructure bill should have the following five characteristics:
Robust: The United States faces an enormous infrastructure investment gap and pressing climate challenges that require immediate and substantial investment. Over the next 10 years, Congress should provide at least $1 trillion in direct federal infrastructure spending above baseline after adjusting for inflation.
Comprehensive: The bill should provide funding for sectors that have historically received federal support, including transportation, water, clean energy, affordable housing, community health and rural broadband internet. Additionally, Congress should expand the scope of its support to include K-12 schools and child care, among other sectors.
Climate-smart: The bill should make a down payment on transforming the United States economy from one reliant on fossil fuels to one rooted in clean energy. The bill also should help states and cities plan for the impacts of climate change and build resilient and accessible infrastructure.
Raises wages and improves job quality: Even with the unemployment rate at less than 4 percent, wages for working American have barely increased. The bill should include a suite of policies designed to boost workers’ wages and benefits, provide opportunities for advancement, and make it easier for workers to unionize, among other labor improvements.
Targeted, equitable, and transparent: Federal funding should be targeted to those communities facing the greatest need. Resources should redress the harms of geographic isolation and excessive pollution caused by past and present infrastructure policies and projects, as well as racial discrimination. Moreover, the bill should ensure environmental review continues to provide transparency and public engagement in project planning.
Infrastructure investments are about more than steel and concrete; they represent the direction the country should take. Making progressive investments will help to create thriving, healthy communities that deliver inclusive and sustainable prosperity for decades to come.
The need for robust federal investment does not stop with transportation and water. Laying the foundation for inclusive and equitable economic growth also means investing in the suite of facilities that local communities need to attract new economic development and that working families need to thrive. These include K-12 schools, child care centers, community health, affordable housing, and broadband internet, among others.
Beyond brick and mortar, access to affordable, high-speed internet is essential to economic development. According to the Federal Communications Commission (FCC), approximately 24 million American households lack high-speed internet. Roughly 80 percent of these households are in rural areas. Each year, several agencies, most notably the FCC and the U.S. Department of Agriculture, provide grants and loans for internet infrastructure and monthly service support, principally in rural areas. In fiscal year 2017, subsidies across the federal government totaled $8.5 billion. While important, these expenditures are modest compared with the estimated $80 billion in potential costs to deploy high-speed internet connections to all American households.
The needs of the energy sector are equally substantial. The path to true decarbonization requires investment and change from generating, transmitting, and storing electricity without pollution to using it more efficiently in U.S. homes, businesses, factories, and vehicles. Beyond adding proven clean energy technologies to the U.S. electric grid and buildings, the federal government should fund pilot and demonstration projects that advance the frontiers of clean energy and carbon removal to invest further in a clean energy future.
Cost of Infrastructure Investment
To truly address America’s infrastructure, economic development, and climate needs, the federal government should spend $1 trillion above baseline when adjusted for inflation over the next 10 years. The United States has more than enough economic and fiscal capacity to make substantial, much-needed investments in its infrastructure—as it has done at other points in its history.
In fact, the necessary infrastructure investments would cost significantly less than the tax giveaway that Congress passed in December of 2017. The $1.9 trillion Tax Cuts and Jobs Act (TCJA) cut tax rates for the wealthiest individuals and corporations while creating deeply problematic loopholes that will lead to tax abuses and potentially encourage new offshoring of American jobs.
The TCJA represents an enormous and immoral upward redistribution of wealth and has already reduced federal tax revenue to just 16.5 percent of GDP—an exceptionally low level for a high point in the business cycle. Repealing the most egregious provisions of the TCJA could provide more than enough tax revenue to cover the cost of comprehensive infrastructure investment, and the United States has available many other progressive revenue options as well.
Job Creation and Labor Standards
A robust and comprehensive federal infrastructure plan would create millions of jobs. However, in the absence of strong job quality standards, many of those jobs would pay low wages, provide few benefits, and offer too few opportunities for advancement. This would not only harm American workers, but also put responsible businesses that respect their workers and offer decent pay and benefits at a competitive disadvantage. When workers are poorly compensated, the government often must supplement workers’ incomes with Medicaid, Earned Income Tax Credits, and nutrition assistance.
For nearly a century, federal lawmakers have sought to uphold the basic guarantee that government spending should create good jobs through a variety of protections, such as prevailing wage laws and discrimination protections. Yet today, these protections are under constant attack and cover less than half of all federal spending. Additionally, existing job quality standards too often allow employers to pay very low wages and do not protect workers attempting to form a union from employer opposition, leaving workers with little power to negotiate for better wages and benefits.
The bill should require all jobs created through federal infrastructure spending to provide family-supporting wages and benefits, opportunities for advancement, and a voice for workers on the job. This includes funds obtained through federal grants, loans, contracts, and public-private partnerships that include federal participation. Moreover, these standards should apply not only to initial construction work but ongoing maintenance, service, and operations jobs as well.
All jobs created by the bill should include coverage under existing prevailing-wage and benefit laws, as well as a $15 wage floor so that the investment does not support poverty-wage jobs and helps build momentum for legislation to raise the federal minimum wage for all workers. The jobs should also include requirements that companies respect workplace laws, including workers’ right to join a union, and that companies cannot attempt to persuade workers in the union selection process.
Finally, the jobs should expand training and apprenticeship programs as well as discrimination protections in order to raise workplace standards and help ensure that women, workers of color, and other historically disadvantaged groups are able to access decent jobs. To help sustain American manufacturing, the infrastructure package should expand the coverage of Buy America and Buy American preference—which are federal procurement laws designed to maximize the use of U.S. materials, including steel, iron, and other manufactured goods—to include more types of spending programs, as well as strengthen monitoring and enforcement of existing standards.