Tuesday, November 26, 2013

The Hidden Battleground: Infrastructure


The United States is sitting behind an estimated $2 trillion in needed infrastructure repair and expansion to bring our roads, levees, bridges, dams, aqueducts, water storage facilities and power grid into the twenty-first century. That’s before we consider the kinds of infrastructure that we will probably need for climate change projects to deflect storm surges, rising tides, to reinforce concrete and steel against the growing strength of powerful storms, mudslides and raging fires. Think that’s happening in an era of austerity? Yeah, more deferred maintenance sprinkled with a few “infrastructure stimuli” projects that we introduced during the early stages of our recent mega-depression. Expect a continued infrastructure slam on American efficiency and productivity.
Ah, if only we had that Teutonic dedication to state of the art technology, that German drive for engineering perfection. What’s that, you say, they are now the poster-nation for severe austerity, and infrastructure is just one more sacrificial lamb to German politicians? They’re in the same jam we are? “A [German] government-appointed commission recently concluded that it needed to spend 7.2 billion euros a year, or $9.7 billion, for the next 15 years — roughly 70 percent more than it spends now — just to get existing infrastructure back into shape. Others say that even more is needed for schools, for instance, and for extending fiber optic cables to less populated areas.” New York Times, November 20th.
How horrible is it over there? The NY Times provides this rather nasty example: “When inspectors decided a few months ago that the aging bridge over the Kiel Canal in northern Germany was too weak for heavy truck traffic, Holger Dechant, hired to deliver giant wind turbines to the other side, was at a loss… He did eventually come up with an alternative route. But it is telling of the sorry state of some of Germany’s roads and bridges: His company is driving the turbines to a ferry, shipping them north to Denmark and then driving them south again back into Germany.
“‘That’s how bad it is,’ Mr. Dechant said recently, explaining the 186-mile detour in his office here. ‘We just haven’t invested enough. And now there is trouble because there is no easy button to fix it all.’” That’s the story all over the recession-impaired West except, of course, in Australia and Canada.
All this as China typically spends several hundred billion dollars a year building new infrastructure? They are building universities and schools at a record pace as well, reflected in the rise of hard patents in the People’s Republic, just as the number of American hard patents fall. The changes that China has been able to implement have been nothing short of astounding.
Anyone who last visited China 20, 10 or even 5 years ago and returns today will immediately notice the massive boom in infrastructure that has taken place in the country. From practically dawdling coal locomotives to cutting-edge high speed rail in 30 years is some accomplishment. Anyone who has read Paul Theroux’s ‘Riding the Iron Rooster’ will recall his accounts of traveling across China by train in 1988; aptly demonstrating the progress in infrastructure development that China has made over the years. That was just five years before the establishment of [foreign investment consulting firm, heavily involved in the PRC] Dezan Shira & Associates, and Theroux tells of coal-powered steam locomotives running the length and breadth of China. The Iron Rooster being of course, an old fashioned steam loco, which is still used for industrial purposes in some of China’s poorer provinces today. Even today, China hasn’t completely phased their usage out.

“The same is true of roads and airports. [We] recall the main Beijing airport expressway being a two-lane road frequented by donkey and cart (the road still exists to the side of the new eight-lane highway, serving local villages as traffic zooms past along the new road) while China’s airport terminals, once shabby versions of Soviet-built breeze block architecture are now constructed by internationally renowned architects. Just 15 years ago, the main source of refreshment at Beijing Airport was a cup of dried noodles and a massive, steaming hot water samovar used to drown them in. Now there are executive lounges, state-of-the-art facilities, and world-class shopping options with WiFi throughout.” China-Briefing.com, March 27th.

But wait, there’s more. While the U.S, has most certainly provided generous support, particularly in response to natural disasters, our international face is decidedly reflected by our military aggression. We particularly reflect our presence by waging unwinnable wars in Iraq and Afghanistan and deploying the most technologically advanced military on earth to spy and float killer drones above countries far, far away.
On the other hand, China is creating monuments to itself that will endure over time: providing infrastructure support to developing nations everywhere. “While programs to assist other countries have been in place since the 1950s, the amount of money allocated to Chinese Official Development Assistance (ODA – also called Foreign Aid) has increased rapidly in recent years. Aid nearly tripled in the eight-year period from 1999 to 2007, from RMB4 billion [$650M] to RMB11 billion [$1.79B] – and a large amount of aid has also been given as debt relief, which is not included in these totals. The Chinese government claims RMB25.5 billion [$4.15B] in loans to developing nations had been forgiven by the end of 2009.” China-Briefing.com
Pictured above: “China has provided over 80 percent of the US$248 million initial development costs for Pakistan’s Gwadar Port on the Indian Ocean, while Chinese [state owned entertprises] have led the port’s construction and are now in charge of its operations.” China-Briefing.com.
And there is the United States. We keep spending on stuff that isn’t needed, on weapon systems designed to fight the Soviet Union but not well-suited to scattered hostile forces not necessarily bound to any particular country. We go where we are not wanted to impose governments and policies that both don’t work and really aren’t appropriate to the local culture. All the while, our deficits are growing and our expenditures on what weneed back home – education, infrastructure and research – are woefully insufficient to support the United States’ continuing status over the long term, our competitors are capitalizing on our failures.

I’m Peter Dekom, and I am very tired of our heartless Congress with little concern for our long-term competitive edge.

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