Institutional investment in U.S. infrastructure is modest but on the rise. Long may the growth continue, for the gap between the country’s investment needs and the capacity of its strapped government budgets is daunting.
In a January report, the American Society of Civil Engineers estimated that the country’s infrastructure needs will exceed projected spending by $1.09 billion between now and 2020, based on current trends. Unless that shortfall is filled, the country could suffer a cumulative loss of economic output of $3.1 trillion over that period, the society claimed.
For anyone who has ever tried to get into Manhattan from New York’s John F. Kennedy International Airport or spent any time cruising on the country’s interstate highways, the U.S. infrastructure deficit comes as no surprise. But the financing gap spells at least as much opportunity as danger.
“Deteriorating infrastructure has a cascading impact on our nation’s economy, yet we have a real opportunity to make crucial investments in America’s infrastructure that will pay off in huge economic dividends,” said Gregory DiLoreto, president of the civil engineers society, in a press release accompanying the January report. Those dividends are attracting more and more institutions, especially long-term investors. ....