The Danger of Stimulus Done Wrong

We're on a road that's paved with good intentions.
This post is part of the research project: Economic Turnaround

istock trafficStimulus spending can provide short-term juice to a sputtering economy. But that’s not the same as saying that any old kind of spending is good. Clearly not.

It would not be wise, for example, to use deficit spending for vast poppy planations in order to create a domestic heroin trade. And yet, some non-trivial portion of US stimulus spending appears directed at deepening a different kind of hazardous addiction.

I’ve taken a few swipes at Washington’s leaders for directing federal stimulus money to pointless highway expansion. But when it comes to nutty highway megaprojects, the Northwest really doesn’t hold a candle to Texas. Check it out:

Texas plans to spend $181 million of its federal stimulus money on building a 15-mile, four-lane toll road—from Interstate 10 to Highway 290 and right through the prairie—that will eventually form part of an outer beltway around greater Houston called the Grand Parkway.

The road exemplifies an unintended effect of the stimulus law: an administration that opposes suburban sprawl is giving money to states for projects that are almost certain to exacerbate it.

The NYT article focuses on the conservation value of the Katy Prairie, an ecosystem jeopardized by the planned toll road. But when it comes to the sheer stupidity of this kind of highway expansion, the loss of rare native habitat is only the tip of the iceberg. The new highway will certainly induce low-density sprawling development—in fact, that’s the express purpose of the new road—that will lock in auto dependence and unnecessarily high energy consumption for generations to come.

 And it’s not like Texas is alone here:


North Carolina is extending Interstate 295 outside Fayetteville, which will benefit Fort Bragg but use up limited resources that were being sought by bigger areas like Charlotte and Raleigh. New Hampshire plans to widen Interstate 93, which gets clogged because so many residents of southern New Hampshire now commute to Boston for work. Lawmakers in Washington decided to widen several highways around the state, but snubbed projects sought by Seattle.

Not to get all ranting-and-raving here, but this is kind of a big deal. Lower density dwellings use substantially more energy and lower density land-use requires more single-occupant vehicle travel, which also uses more energy. This is at a time when our economy is already handicapped by volatile energy prices and when our entire way of life is threatened by climate change. It’s something worse than counterproductive to spend borrowed money to deepen our dependence on energy commodities while worsening global warming.  

Granted, the freeway expansion stimulus spending will likely be effective on its own terms. What I mean is that regardless of the merits of these projects, the spending will almost certainly create jobs in the near term and boost consumer spending. That’s what it’s intended to do. But there’s a very real danger that at least a portion of the stimulus spending will actually land us in a worse long-term position — not just because we’ve run up debt but because we’ll have effectively walled off the escape routes from a serious energy-addiction problem. This isn’t just an environmental problem, but a fairly serious economic one.

At the risk of sarcasm then, it might actually be better to just bury some cash and then pay people to dig it up. We wouldn’t have accomplished anything with the money—apart from the short-term economic stimulus, that is — but we’d at least be no worse off than we are now.

 H/t to Roger Valdez.

Update 3/24/09: Over at Worldchanging, Alex Steffen has a top-notch analysis of Ray LaHood, the problems with the US Department of Transportation, and the manifold opportunities to improve the nation’s transportation system. It’s a must-read.

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Comments

  1. VeloBusDriver says:

    Every time I hear about the stimulus package creating jobs it’s in the context of increased spending on highways, bridges, and roads. It seems pretty obvious that there is more bang for the buck investing in transit, pedestrian, and bicycle projects but you rarely hear about this.And yes, I know there is money for transit in the stimulus bill. I just wish there was a “no-new-general-purpose-lanes” clause in the stimulus bill. Repairs to critical infrastructure, fine. *new* SOV lanes? No way… We’ve had at least 53 years of federal subsidies to road building. Enough is enough…

  2. Falbhan says:

    I kind of like the idea of planting poppy fields.Legalize heroin, tax all elements of the pipeline just as we do with other legal businesses, cut DEA to pay for this stimulus, eliminate the heroin source of funding for Al Qaida, stabilize the India/Afghanistan/Pakistan region as a byproduct of Al Qaida’s reduced influence, pull much of the US Military presence.Rather than line the returning soldiers up on our Southern border legalize cocaine and marijuana, provide stimulus funds for coca, cannabis and hemp growing, tax all elements of the pipeline just as we do with other legal businesses, cut DEA to pay for this stimulus, eliminate the cocaine/marijuana source of funding for for all the destabilizing elements in Mexico, Columbia and elsewhere, stabilize the countries to the South, avoid further spending on anti-drug forces thereby freeing up that money for paying down the deficit or pumping it back in as further stimulus.Well, I could go on, but hopefully you get my point.

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