Yesterday President-elect Barack Obama announced a massive jobs stimulus package for the economy, which many have compared to Dwight Eisenhower’s federal highway building program of a half-century ago. While the scale of the comparison may be apt, it is essential that Obama’s team makes this a 21st century stimulus and not a repeat of the 1950s.
Investment in roads and infrastructure seems like a good thing, but there are limitations. Highway building only produces half the economic spinoff of building rehabilitation – preservation – for example. The reasons why are easy to see: it is a machine-and-material based job that kicks a lot of cash to concrete and surfacers. The ratio between labor and materials/machines is not nearly as favorable as building rehabilitation. Continue Reading

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