Despite recent bipartisan efforts in Congress, there is still no path in sight to meet America’s current or future infrastructure needs. “Because of our politics right now nationally, in Washington, we don’t have the decency to maintain the assets and infrastructure that our parents and grandparents had the decency to build for us, much less the decency to build the infrastructure that our children are going to need, that our grandchildren are going to need in the 21st century,” noted Senator Michael Bennet (D-CO) at a May 7 launch event for the Bipartisan Policy Center’s new Executive Council on Infrastructure.
His opening remarks illustrated the need for a working group of corporate CEOs and other senior executives drawn from a range of industries who have committed to spending the next year exploring ways that the business community can bridge America’s infrastructure funding gap. The council’s goal is to better connect private capital to American infrastructure–tapping billions of dollars that could be available for this purpose but are currently targeted elsewhere.
Doug Peterson, McGraw Hill Financial’s president and chief executive who is co-chairing the council, said that he and the other business leaders were up for the challenge. He noted the important role that infrastructure plays in increasing productivity, improving public safety, and enhancing the country’s global competitiveness. “Infrastructure is such a critical opportunity for the United States,” Peterson noted. “There’s an opportunity to build an infrastructure which is going to provide the growth and the jobs to allow the country to be competitive.”
Along with Peterson, three other chief executives who are members of the council were on-hand for the launch event and participated in a panel discussion. Patrick Decker, president and chief executive of Xylem; Suzanne Shank, president and chief executive of Siebert Brandford Shank; and Jack Ehnes, chief executive of the California State Teachers’ Retirement System (CalSTRS) shared some of the challenges their companies are facing when it comes to investing in infrastructure and pointed out some of the biggest barriers to greater private sector investment. (Other business leaders on the council–representing American Water, FedEx Freight, KPMG, and Merdiam–will take part in future events.)
Patrick Decker of Xylem noted that public spending on water infrastructure has declined by nearly 20 percent in just two decades, and that recent events such as the drought in California make it clear that this trend is not sustainable. Jack Ehnes of CalSTRS reiterated that there is something going awry between the clearly demonstrated need for infrastructure investment and the amount of private capital available. As an example, he relayed that in 2014, CalSTRS looked at 136 possible investment opportunities globally in infrastructure, but found only 17 of them were worth reviewing, and only closed two of those. Suzanne Shank, head of the investment company Siebert Brandford and Shank, emphasized that government needs to work with the private sector, particularly in effectively sharing risk between government entities and private investors.
Over the course of the next year, the council will meet regularly to explore measures to overcome information gaps that preclude private investment, including identifying legislative, financial and regulatory barriers. Informed by research, outreach to stakeholders and experts, and internal deliberations, the council will develop and endorse a set of specific recommendations to facilitate increased private sector investment in U.S. infrastructure.
Senator Bennet also offered a somewhat less rigorous suggestion for turning the public spotlight on the need to build and maintain our roads, ports, water systems, and other critical infrastructure. Anyone running for public office should have to “spend ten minutes on the deck of a barge in Hong Kong harbor, and take a look around at the investment that’s being made there versus the investment that’s being made here,” he said in his opening remarks.
More information on the Executive Council on Infrastructure can be found at bipartisanpolicy.org/infrastructure.