The democratic party has proposed to use infrastructure improvement projects as a way to stimulate the economy out of the recession. Provided that it is executed right, it is just plain good idea. Will it increase our debt? Yes. But for once, we would be spending money on things that would make this country more efficient, our businesses more competitive and our life easier. This is a good debt, the kind that actually has a chance of being repaid and making dividends.
More importantly, the learning opportunities, the opportunities for the development of managerial talent and entrepreneurial mindset abound in the environment where the infrastructure is being upgraded.
These projects have the potential to create value and therefore make our society, wealthier and more successful. They can be run by private businesses, but the government has to at least identify priorities and align funding to make those priorities relevant to the individual businessmen.
The best part is that most infrastructure work cannot be outsourced and is thus guarantied to create work in America.
On the other hand, these projects will only work if there is a comprehansive plan where many factors are weighted in for the project assessment. Many of the projects of the New Deal for example, were counter productive, had unintended side effects and did not focus on rewarding people through meritocrocy. In all fairness, the economic conditions of the Great Depression were sufficiently worse than what we are experiencing today, that effective action now should allow our country to come out of this crisis rejuvinated and more competitive than ever.
What are your thoughts?
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