Monday, April 1, 2013

US eyes pension funds to renew crumbling infrastructure

Katelyn Fosset in IPS: President Barack Obama doubled down on a new push for infrastructure investment in a major speech Friday, highlighting roads, ports and bridges that many say have suffered from decades of insufficient upkeep.

“When the American Society of [Civil] Engineers put out their 2013 report card on our national infrastructure, they gave it the best overall grade in 12 years … the bad news is we went from a D to a D+,” President Obama said, speaking at a port in Miami.

...The American Society of Civil Engineers (ASCE) annual report the president referenced was released earlier this month and has spurred a debate over infrastructure and spending in Washington and beyond.

“We know that investing in infrastructure is essential to support healthy, vibrant communities. Infrastructure is also critical for long-term economic growth, increasing GDP, employment, household income, and exports. The reverse is also true – without prioritizing our nation’s infrastructure needs, deteriorating conditions can become a drag on the economy,” the report states. On Friday, President Obama outlined a new plan that, he said, would seek to attract private investment for public infrastructure, while also creating new bonds and offering more loans for similar projects.

A think-tank in Washington has one idea for leveraging private investment toward infrastructure: encourage the investment of labour union pension funds in infrastructure projects. “Couple [our poor state of infrastructure] with pension funds, which are long-term, patient investors, with stable, risk-adjusted returns, and this fits well with our fiduciary duty,” Dan Pedrotty, managing director of benefits and pensions at the American Federation of Teachers, said Thursday at the release of a report on the topic at the Center for American Progress (CAP)....

The Mianus River Bridge in Cos Cob, Connecticut, which failed back in the 1980s. US Department of the Interior photo

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