In 1988, the U.S. infrastructure system including all public and private non-residential capital stock was valued at $7 trillion, an immense portfolio to operate and manage.
[3] And according to the Congressional Budget Office, in 2004 the U.S. invested $400 billion in infrastructure capital across federal, state, and local levels including the private sectors on transportation networks, schools, highways, water systems, energy, and telecommunications services.
The American Society of Civil Engineers have continued to give low marks, averaging a D grade, for the nation's infrastructure since its inception of the Report Card in 1998.
The aviation sector remains mired in continued delays in the reauthorization of federal programs and an outdated air traffic control system.
[6] Aschauer argues that the golden age of the 1950s and 1960s were partly due to the post-World War II substantial investment in core infrastructure (highways, mass transit, airports, water systems, electric/gas facilities).
[7] Moreover, infrastructure services carry the market-distorting features of pure, non-rival public goods; network externalities; natural monopolies; and the common resource problem such as congestion and overuse.
[6] Empirical models that attempt to estimate the public investment and economic growth link involve a wide variety including: the Cobb-Douglas production function; a behavioral approach cost/profit function which includes public capital stock; Vector Auto Regression (VAR) models; and government investment growth regressions.
These models nonetheless contend with reverse causality, heterogeneity, endogeneity, and nonlinearities in trying to capture the public capital and economic growth link.
Beyond economic performance, public capital investment yields returns in quality of life indicators such as health, safety, recreation, aesthetics, and leisure time and activities.
[1] Furthermore, infrastructure adds to community ambience and quality of place with livelier downtowns, vibrant waterfronts, efficient land uses, compact spaces for commerce and recreation.
[14] Also, the Environmental Protection Agency's (EPA) Clean Water Act of 1972 provided a public capital investment of $40 billion in constructing and upgrading sewage treatment facilities with “significant positive impacts on the Nation’s water quality.”[1] Considered by the National Academy of Engineering to be the greatest engineering achievement of the 20th century, the North American electric grid carries electricity over 300,000 miles (480,000 km) on high-voltage transmission lines across the U.S.
Some of ARRA's aims include smart grid technology, retrofitting of homes and federal buildings, automated aviation traffic control, advancing freight and passenger rail services, and upgrading water and waste facilities.
[19] With continued expansion of terminals and connection to nation's comprehensive transport system, the Hong Kong International Airport is one of the largest engineering and architectural projects in the world.
[20] In the last decade, Chile installed five combined cycle gas-turbined (CCGT) power plants to meet its nation's growing energy needs.