Richard Little on a new infrastructure bank

Richard Little, senior fellow at the Sol Price School of Public Policy, responds to the piece I highlighted last week from Felix Rohatyn and Rodney Slater proposing a new form of federal infrastructure bank in a letter to the Financial Times:

Despite the obvious passion of Felix Rohatyn and Rodney Slater, their call for a US National Infrastructure Bank as the solution to the nation’s chronic underfunding of infrastructure is a bit of a red herring (“America needs its own infrastructure bank”, February 20). What our highways, ports and waterways desperately need are more revenue, not a new financing bureaucracy.

The article goes on to point out that infrastructure banks do not create free money, and that the problem is, simply, that we need to face the facts that users of US systems need to pay more than they are now:

The unspoken reality of US infrastructure investment is that the users and beneficiaries of these systems (all of us) will have to pay a bit more for the privilege through taxes or tolls, regardless of whether the public or private sectors provide the financing. Until elected officials in the White House and on Capitol Hill muster the courage to share that fact with the American people, we will continue to have these interesting but quite pointless, conversations about the merits of an unneeded institution.

The other unspoken reality comes from David Levinson: Transportation Costs Too Much. He is kind enough to share the credit for the list with other bloggers who added to his 39 theses.

So I’ve tended to agree with Richard: we already have a lot of infrastructure banks in the US, and around the world, that US governments could borrow from if they wanted to. It’s not clear what a new one would bring into the mix. I’m still think about the REITS idea. Maybe I’ll get Richard Green to explain it to me some time over lunch.