On Infrastructure, Google, Keynes, et al.

So Phil Greenspun points to a plan for an electric car infrastructure in Hawaii. Phil also notes that bailing out Detroit isn’t, to date, keeping them from shedding jobs. Rex Hammock jokes about bailing out Google, reference Obama’s address below:

I found myself at dinner on Thursday night with a table full of libertarians, all friends of mine from college who were shocked that I am an Obama supporter. But let me tell you what I think could happen, weaving all those threads together …

President-elect Obama suggested that his public works project would be the largest effort since the Interestate system. When you think of the Interstate, what do you think of? Me, I think of this nation’s very arteries, a circulatory system to help move people and cargo around our beautiful country. Yes, the Interstate system cost around $130B to produce, but … compare that to the financial bailout. You’re nodding your head, right? “We got a lot out of the Interstate system, over decades, and what have we gotten out of this bailout?” Well, we’ll never really know the answer to that question, will we? It’s not a natural experiment by any means—no man is an island, etc.

When I think about the Interstate system, I not only think of arteries, but how we’re wasting space. What about those medians, the rights of way, the easements? If you needed to develop a national infrastructure—say, the laying of fiber optic cables to transmit data over the Internet—wouldn’t that be a perfect place to lay them? Known good land, well-surveyed, easily reachable.

The best spending choices that a government can make are infrastructure that benefits the greatest good. Roads, bridges, et al are great choices for this—so, too, would be developing suitable interstate routes into high-speed rail paths. Kill Amtrak—monocultures are bad!—and provide the opportunities for business to come in. Some folks will choose to develop the high-speed rail business; others will work on the endpoint infrastructure [rental cars, etc.] to allow people last-mile access when they get there.

I’m thinking about going to see UAH play at the Badger Showdown after Christmas. I’d love to drive an electric car, but man, those things don’t get good mileage at all. Now, we could have an infrastructure with rest stops every 25 miles to allow you to swap batteries and keep going, so you could just keep going and not stop to swap, but that’s not a very efficient system for me as an end-user. But if I could drive an electric car from my house to a high-speed railway along I-65, which would carry me all the way to Chicago … well, then, I just have to change trains to get to Madison, then drive another electric car on the far end around town [unless I head to State Street, in which case I should be taking a taxi]. Rather than the crazy amount of gas I’d spend, I could do that trip pretty easily without burning a single bit of fossil fuel [presuming that we weren’t generating electricity in conventional ways].

The way government can pull some crazy dream like this off is in a two-part system: building it out, and then letting people and businesses use it. If you build it, the ecosystem will form around it—just look how commerce in this country flocks to our nation’s highways. Mass transit is the way to go, but it’s so dependent on population density to be fully worthwhile. The highway system, though, already has plowed the ground for these pathways.

Obviously, a system like this takes transition. I’ll tie the Detroit thread in like so: the only way that it makes sense for Washington to give Detroit money is as a consumer. You say to the Big Three, “Hey … we’ll replace the entire government fleet of vehicles, but only with hybrid electric vehicles that meet these specifications.” That would create enough of a marketplace that Detroit could economically retool their factories and retrain their workforces with a guaranteed customer base, driving down costs where these vehicles would be similarly cost-effective for consumers. Hybrids stop being so much about green as they are red, white, and blue.

That said, I don’t expect much of this to happen, but I welcome any investments in infrastructure, as long as it’s done in such a way that you don’t create monolithic producers. That’s another matter entirely…