by Alphecca Muttardy

T

here is a growing campaign in the United States to create a National Infrastructure Bank. This would permanently address the massive shortfall in infrastructure repairs and construction of new 21st century projects. A bill in Congress to do this, HR 4052, has 40 sponsors, including 8 ranking Democrats. Also, resolutions of support have been sponsored or passed in dozens of legislatures, city and county councils and many other organizations.

The United States is the only advanced sector nation without such an institution. Ironically, the U.S. invented the idea, and has had four similar institutions in our history. The last one, under President Franklin Roosevelt, helped end the Great Depression and win WWII.

According to the American Society of Civil Engineers (ASCE), the infrastructure shortfall in the country is over $6 trillion, of which over $3 trillion is unfunded. New 21 st century projects, such as high-speed rail, have virtually no money. The Bipartisan Infrastructure Law, which passed in 2021, was a good bill, but covered only 10% of the gap. It is slated to expire in 2026, with no Plan B on the horizon.

* The infrastructure needs of North Carolina mimic those of the nation. According to ASCE, 33% of North Carolina roads are in poor or fair condition. Seven percent were structurally deficient in 2021. NCDOT estimates 1,150, or 8.4 percent of the state’s bridges are considered in poor condition. It will cost at least $4 billion to fix the bridges.

* According to ASCE, North Carolina needs $17 billion to fund drinking water repairs and replacement, and $5.8 billion to fund wastewater systems. North Carolina has over 370,000 lead water service lines needing immediate replacement. The cost will be approximately $4 billion. Lead poisoning is irreversible and causes permanent cognitive impairment.

* There is a shortage of at least 200,000 units of affordable housing for those most housing insecure.

* North Carolina would greatly benefit from a high-speed rail system connecting Georgia, North Carolina, Virginia and the East Coast. A route connecting Atlanta, Charlotte, Greensboro, Raleigh and Richmond would transform transportation and industry in the region.

The National Infrastructure Bank, as embodied in HR 4052, is the only financing vehicle in Congress large enough to cover all the project needs.

The NIB would be a $5 trillion permanent bank capitalized with existing Treasury debt, and require no new federal spending and no new federal taxes. The NIB would create over 20 million new jobs, pay Davis-Bacon wages, and require Buy American for all inputs. This would both repair our crumbling infrastructure and spark a large-scale industrial expansion. The NIB would finance urban and rural projects to address persistent poverty. It would also work to build up rural communities. This would include construction of all broadband systems, upgrade the power grid, road and bridge modernization, and rural hospitals and clinics. This investment would help farmers and generate new industries in rural regions.

Congress is running an annual deficit of over $1 trillion; the cupboard is bare. The NIB is the perfect vehicle to fix our problems and build a 21st century infrastructure that would again be the envy of the world.

Alphecca Muttardy is a macroeconomist and former senior economist with the International Monetary Fund (IMF).