Labor, business can unite as economic heroes

The United States needs some kind of national infrastructure bank - an entity that would provide the financing for long-overdue repairs and improvements to our roads, bridges, and other public works. There is a $2.2 trillion backlog of such projects. Amid rising concerns about federal spending, infrastructure investments are more efficient economic drivers than tax cuts or other stimulus spending in achieving these goals.

Moody’s Economy.com estimates every $1 spent on infrastructure generates a $1.59 increase in GDP. University of Massachusetts Professor Robert Pollin has shown these projects generate between 20 to 30 percent more jobs than equivalent tax cuts.

For such reasons, President Obama is likely to call for greater infrastructure spending in his upcoming jobs talk. But some in Congress have already called it “dead in the water,’’ in large part because it looks to them like another big government program.

This is why business and labor need to lead this effort. By showing they are willing to work together to fund and manage a private-public bank, they can help convince Congress to do its part - essentially, to authorize issuance of special low-interest bonds. And, by working together, business and labor can show Congress and the American people they are trying to help end the polarization that is killing the economic recovery and ruining our democracy.

As governments around the world face growing fiscal pressures, the use of some outside money for public infrastructure has become more common, and these investments have paid off well for investors, workers, and customers. In Britain, 15 percent of infrastructure projects are now private-public partnerships. These projects are chosen purely on their economic merits, not for political patronage, and have achieved high on-time and on-budget performance outcomes, 80 percent customer satisfaction ratings, and higher employment standards than conventionally financed and managed projects.