IPS Transportation Expo, Remarks

Remarks by Carol Hallett
Of Counsel, U.S. Chamber of Commerce

Hollywood, FL
August 12, 2008

As prepared for delivery

Thank you very much. I'm very pleased to have this opportunity to discuss one of our nation's biggest challenges – infrastructure.

Before we jump into that discussion, let me quickly say an additional word or two about the U.S. Chamber of Commerce.

The largest lobbying organization in the world, the Chamber is the premiere voice of the business community both in the United States and, increasingly, overseas.

We maintain a professional staff of more than 300 of the nation's top policy experts, lobbyists, lawyers, and communicators at our Washington, D.C. headquarters. Their work is supported by additional staff in eight regional offices around the country.

The Chamber's International division, working with in conjunction with more than 100 American Chambers of Commerce in 94 countries, fights to build bridges for global commerce and to tear down the walls that keep our companies out of lucrative international markets.

The Chamber has its own public policy law firm, which achieved 54 court victories on behalf of business last year.

It has a public policy think tank that identifies emerging issues affecting business, researches them, and forms the business argument for or against them.

The Institute for Legal Reform and the Institute for 21st Century Energy are also part of the Chamber, working for a more favorable legal climate and a commonsense national energy strategy, respectively.

We also have major initiatives to protect intellectual property, reform the education system, and make the U.S. capital markets more competitive.

The Chamber's overarching mission is to strengthen the competitiveness of the U.S. economy. All of the issues I just mentioned are planks of our competitiveness agenda, but the one plank I want to focus on today is infrastructure.

The hard truth is that when many people hear the word "infrastructure," their eyes start to glaze over. Infrastructure is not a sexy issue. It doesn't capture the media's attention like it should. Few candidates make it a centerpiece of their campaign. And it regularly gets bumped down legislators' lists of priorities.

Occasionally, there is an incident, such as the Minneapolis bridge collapse, when we are reminded of our fragile infrastructure and the need to fortify it.

We wring our hands and agree that something needs to be done. But then the story fades and it's back to business as usual. This nation is so overwhelmed by the enormity of our infrastructure challenge that we put it on the backburner to deal with later – but we never do.

We need to change that. Our infrastructure is outdated, overwhelmed by growing demand, and, in many cases, literally falling apart.

Once one of America's proudest achievements, our infrastructure today is one of our greatest challenges, posing a tremendous threat to our continued economic growth, competitiveness, and standard of living.

Why should infrastructure be a national priority? Because, first, it is a competitiveness issue— China spends 9% of its GDP on infrastructure; India, 5% and rising.

The United States has spent less than 2% on average as a percentage of GDP since 1980. We
cannot expect to remain competitive with that level of investment.

Second, infrastructure is a quality of life issue—Thirty-six percent of America's major urban highways are congested, costing drivers $78 billion a year in wasted time and fuel costs. And while their car engines are idling, they are pumping thousands of tons of pollution into the air.

And, finally, it's a safety issue—Poorly maintained roads contribute to one-third of all highway fatalities. That's more than 14,000 deaths every year.

Unlike with other challenges, we can't wait until the very last minute and then write a big check to immediately fix our infrastructure.

Projects require foresight and years of careful planning, and that is why time is of the essence. We need to act, and we need to act now to create an infrastructure that's geared for the 21st century global economy.

As we work toward that goal, we need to keep three things in mind:

First, more resources are required—plain and simple. There is no free lunch.

The National Surface Transportation Policy and Revenue Study Commission estimates that the United States must invest $225 billion per year from all sources over the next 50 years to maintain and adequately enhance our surface transportation systems.

We are spending less than 40% of this amount. The funding deficit is so severe that no funding option can be left off the table.

Everything should be considered: additional public funding, public-private partnerships, innovative approaches to stretching resources such as a federal infrastructure bank, and, yes, even an increase in the federal gasoline user tax, which has not been raised in 14 years.

I know you might think it's a crazy time to even suggest this with gasoline near $4 per gallon.

But I'm not running for office, so I actually get to tell you the truth. And the truth is that sooner or later, we're going to have to face up to the resources question—if we want a superior and safe infrastructure and a competitive American economy.

Every mode of transportation is starving for investment. Costs attributed to airline delays—due in large part to congestion and an antiquated air traffic control system—are expected to triple to $30 billion annually from the year 2000 to 2015.

By 2020, every major U.S. container port is projected to be handling at least double the volume it was designed to handle.

And what about railroads? Throughout the United States, they are projected to need nearly $200 billion over the next 20 years to accommodate freight increases.

Here's the second point we need to remember: It's not just the amount of money we spend on infrastructure; but how we spend it.

We need to support a comprehensive multimodal and intermodal transportation infrastructure vision. This means prioritizing and making tough spending decisions based on actual need instead of politics.

The last surface transportation reauthorization bill contained earmarks totaling nearly $15 billion for some 5,000 pet projects. Now, earmarking in and of itself is not necessarily a bad thing, but we need to make sure that federal earmarks serve the national good.

There is something terribly wrong with the system when hundreds of millions of dollars are earmarked for the construction of a bridge to nowhere in Alaska while critical projects in major metropolitan areas are neglected.

Even worse is when federal transportation funds are diverted to rain forests in Iowa, theater restorations in New York, and interpretive signage and trails in Pittsburgh urban parkland while projects to alleviate traffic congestion or to connect rural communities to urban areas struggle to identify resources.

We also have to move quicker. Bureaucratic red tape is a major problem.

We've allowed governments to pile on complex and overlapping regulations that stretch project delivery times to 13 years on average.

Here is my third and final point: all of us here must be active participants in the infrastructure debate. If business isn't at the table, then it's going to be on the menu.

One group working for change is Americans for Transportation Mobility, a U.S. Chamber-led national coalition of business, labor, and transportation industry interests with a focused mission of increasing highway and transit funding.

Around the country, more than 400 groups including local chambers of commerce, transit authorities, and road builders are members of ATM.

The Coalition just recently launched its Faster, Better, Safer campaign – a full court press for the maximum level of public highway and transit investment in the next federal authorization bill.

Because roads and public transportation are just part of our much larger critical infrastructure system, the U.S. Chamber is putting money, people, research, programs, and strong political action around a broader campaign called "Let's Rebuild America."

This effort is focused on identifying and driving solutions to modernize, expand, and rebuild the entire physical platform of our nation's economy, including not just transportation infrastructure, but also on our water, energy, and broadband networks.

The American Society of Engineers pegs the nation's total infrastructure gap at $1.6 trillion dollars – that's the level of investment needed to bring existing system up to par.

That figure doesn't even take into account additional infrastructure that is needed to support a growing economy.

While I've focused my remarks today on transportation, I assure you the Chamber's commitment to building up the nation's energy and telecommunications capacity is equally
strong.

Phone companies, cable operators, wireless carriers, and others are in the process of investing hundreds of billions of dollars in broadband infrastructure.

Yet, there are still parts of our country where people and businesses do not have broadband.

That's why the Chamber has partnered with Connected Nation, a nonprofit organization focused on fostering the deployment of highspeed Internet to all communities while increasing user demand through state and local grassroots awareness/adoption campaigns.

With regards to energy, the construction of much needed refineries, pipelines, coal and nuclear power plants, and electricity grids is continually hamstrung by regulatory restrictions.

We haven't built a new nuclear power plant or refinery in thirty years. And now, there is a concerted legal, regulatory, and financial attack underway against the expansion of coal-fired
plants. It's a prescription for national economic decline.

In fact, when it comes to the construction of energy facilities, we've gone from NIMBY (Not In My Backyard)…to BANANA (Build Absolutely Nothing Anywhere Near Anything) …to NOPE (Nothing On Planet Earth). We must work together to get these projects underway.

The Chamber's Institute for 21st Century Energy is committed to moving the country closer to implementation of a comprehensive national energy strategy that is based on three principles:

• Greater efficiency
• Investment in new technologies that expand alternative energy and allow us to use
  traditional sources more cleanly; and
• Global action in which both developed and developing nations commit to achieving
  common environmental goals but are given the flexibility to find their own best path to
  meeting CO2 reduction targets.

Ladies and gentlemen, our nation's infrastructure …from interstate highways to the Information Superhighway… from airports to water ports to wastewater systems …from rail lines to transmission lines to power plants … is the central nervous system of our $13 trillion economy.

And let's just say that if we continue down the same path, our central nervous system is going to fail, leaving the nation paralyzed.

The U.S. Chamber is ramping up its efforts to educate and rally the business community around infrastructure challenges and opportunities.

The time to get serious about this is now. Thank you for this opportunity, and thank you for your commitment to this important issue.