America’s transportation network is vital part of the country’s economy, accounting for 9% of the gross domestic product. Yet this complex web of roads, bridges, waterways, railroads and airports – essential to moving both people and products — has long suffered from financial neglect. The amount of taxpayer money needed to build, repair and maintain a single piece of infrastructure, especially one that has been damaged or destroyed by a natural disaster, can run into the billions. The sticker shock can make such projects politically unpopular for elected leaders who have to justify the expenditures to the public. A vicious cycle is set up, where managers put off repairs, make do with what they have and wait for a federal payout when disaster strikes. But there is a better way.
A new issue brief from the Penn Wharton Public Policy Initiative offers some solutions that policymakers could pursue to shore up U.S. infrastructure, including more private insurance to fill the federal funding gap. Gina Tonn is a post-doctoral researcher with the Wharton Risk Management and Decision Processes Center. Jeffrey Czajkowski is managing director of the center. Howard…
