“Infrastructure Deficit” Getting Worse

“Infrastructure Deficit” Getting Worse

US Secretary of Transportation Anthony Foxx acknowledges the funding gap for transportation projects
US Secretary of Transportation Anthony Foxx acknowledges the funding gap for transportation projects

The supply chain community has long argued that America’s transportation infrastructure is in dire need of new investment. It is encouraging therefore that US Secretary of Transportation Anthony Foxx expressed a similar view during a visit to MIT on January 5, 2015.

Foxx said that the country’s “infrastructure deficit” is growing and without more investment and long-term planning will worsen. Moreover, the situation on the ground is probably much worse than that depicted in paper calculations of the deficit, given the uncertainty over funding mechanisms for infrastructure projects.

Speaking in MIT’s Wong Auditorium, Foxx was interviewed by Yossi Sheffi, Director of the MIT Center for Transportation & Logistics and Elisha Gray II Professor of Engineering at MIT. The forum that hosted Foxx is part of MIT CTL’s Global Leadership Speaker series.

The US Department of Transportation is working on a 30-year plan that focuses on the future of transportation, explained Foxx. New technology is a key part of the work, and Foxx noted specific areas of interest including freight hubs, high-speed rail links, air safety systems, and technology that automates vehicle operation.

A contentious issue is the US Department of Transportation’s reliance on gasoline taxes for its revenue. In a recent Linkedin Influencer blog post Sheffi advocated a “hefty” gas tax on Americans of the order of 50% to 70% and a different money allocation mechanism for the funds generated by the tax. A higher tax would stimulate demand for fuel-efficient cars, promote energy independence, reduce traffic congestion by discouraging unnecessary driving, and reduce the regulatory load on drivers, argued Sheffi.

Sheffi asked how the department’s reliance on these taxes impacts transportation spending. Foxx said that revenues from the gas tax are declining in part because vehicles are becoming more fuel efficient. The fall in revenue exacerbates the “infrastructure deficit” and adds to the general uncertainty over how building projects are to be funded.

But there are some positive developments too. Foxx supports high-speed rail, and pointed to the start of construction on a line that links San Francisco and Los Angeles. New transportation technology continues to emerge, notably the prospect of automated vehicles, although Foxx said that driverless cars are still some way off, and a number of safety and liability issues have to be resolved before the technology becomes a reality.

 

 

 

 

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