Thank you Rosabeth [Moss Kanter], it is a pleasure for me to be here today with you, Secretary Foxx and Tom Donohue. I also want to express my appreciation to the Harvard Business School and to Dean Nohria and Professors Michael Porter and Jan Rivkin for all you have done in recent years to spark a conversation about public investment and American competitiveness.
You know, we did not become the world’s largest economy just by good luck. We have never been the world’s most populous country or the largest country in land area. Our economy became the most productive in the world in substantial part because we made massive, smart investments in public goods at the right times.
First in canals and ports, then in railroads, and in universal telephone and telegraph service. Then we built an interstate highway system and an unparalleled airport system that knit our country together as no country our size had ever been before.
Government was not a bystander in this process. And neither was business. Business’ support for public investment by government was key to making the 20thcentury the American century.
But no nation can live off its past. And unfortunately, that is literally what we are doing. We have been coasting on those investments for decades.
The American Society of Civil Engineers’ most recent report rates our nation’s infrastructure a D+, and they say it would cost $3.6 billion dollars to bring our infrastructure up to par. That’s up from $2.2 billion just four years earlier. And understand, this is just the deferred maintenance on our infrastructure inheritance.
Some of the examples of the deficiencies are stunning, penny wise and pound foolish. 25% of our bridges are structurally deficient or functionally obsolete. 42% of major urban highways are congested, costing business and citizens over $100 billion per year. The FAA estimates that airport delays and congestion cost the nation $22 billion in 2012.
That’s what the experts here at home say when they look at all the pieces of our infrastructure from the bottom up. And the picture is no better when business leaders are asked about how the U.S. stacks up internationally.
The most recent World Economic Forum competitiveness report ranked our roads 18th in the world, down from 11th five years ago. On railroads we are 17th. On ports, 16th. On air transport, 18th. Middle of the pack and falling? The United States? This is simply not acceptable.
Because for America’s working people, these numbers spell economic disaster. Any strategy we might pursue to achieve competitive advantage as a nation will require world-class infrastructure. In a world of growing trade and growing competition, inferior infrastructure means long-term economic decline.
I can tell you that our competitors are not standing still, something I saw on a recent trip to China. The Chinese high-speed rail system is nothing short of amazing. The most amazing thing about it is that not too many years ago, both the U.S. and China committed to building high-speed rail. Today, the Chinese system carries more passengers than the U.S. domestic airline industry. The U.S. system does not exist—there is not a single mile of high-speed rail in this country.
Near Shanghai, I visited the Yangshan Deep Water port, the world’s largest and busiest container port. In 2001, nothing was there but a sleepy fishing village. But the Chinese move fast. The first phase of the project opened in 2004, and by 2013 China had accomplished its goal of having the world’s largest port.
To get to the port, I traveled on a 20-mile-long, six-lane bridge. The bridge was completed in two and half years and employed close to 6,000 workers. That’s what we’re up against.
If the United States does not act, we will fall further behind.
And we must understand the scale of the real need. We should be investing hundreds of billions more a year in infrastructure. Over 10 years we need trillions more in infrastructure investment than our current trend line. And most of that investment will have to be funded with public dollars. There is no shortcut.
But in the face of all these needs and the political paralysis in Washington, those of us concerned about our country’s future must have priorities. The most pressing priority is to authorize and fund a new surface transportation act.
The Highway Trust Fund is going broke, projected to be out of money by September.
Failure to act will mean our transportation system will decay further, construction workers will stay on the bench, supply chain and transit workers will lack steady work and our economic competitiveness will be diminished.
Surface transportation legislation is the most important jobs legislation Congress considers on a recurring basis. Each $1 billion in federal funding generates 35,000 jobs, and employment in the construction sector is still down by 1.6 million compared to before the recession.
We must find the political will to pass a multi-year solution, funded through a user fee that is adequate to meet the needs. The AFL-CIO supports increasing the gas tax, or some variation of it, because at this late hour it is the only credible solution, and it maintains our user fee-based system. Tom and I recently testified before the Senate on this matter, and Chair Boxer told us she favors a 5- or 6-year authorization. The AFL-CIO would be very supportive of something along those lines.
Once we get past the emergency of the surface transportation funding crisis, the AFL-CIO supports a broad investment agenda in all aspects of our nation’s public goods—transportation and energy and communications infrastructure, our aging municipal water systems, and our schools at every level.
We need public goods that meet the needs of the 21st century—that tackle the challenge of climate change, that place us as a nation in the technological lead—not in catch-up mode. This will require a highly skilled, productive workforce. Union-based apprenticeships stand ready to meet this need for as large an infrastructure program as the nation can imagine.
So we must find a way to expand and modernize our urban and regional transit systems. Rising ridership and falling funding are not compatible, and the need to connect workers with jobs is growing.
We need smooth, efficient and seamless connectivity between one mode of transportation and another. Our air transportation system is running on outdated technology, our ports are scrambling to prepare for the Post Panamax cargo ships that will be the new world standard and high-speed rail must become a reality, not a pipe dream.
Our nation has two choices. One is to move forward, invest in America and lead the 21st century.
Or, we can look back, reminisce about how great we were and lament that America could not find the political will to invest in ourselves.
I am truly heartened by the partnership the AFL-CIO has with the Chamber of Commerce on infrastructure. But for that partnership to succeed in an era of political extremism and gridlock, it will require real passion on all of our parts—the Chamber and the federation, individual companies and unions at the national and at the state and local levels—and institutions like the Harvard Business School.
I can only speak for the AFL-CIO—but I pledge to you we are ready to work together with business, government—all of us—and to bring all the passion and determination we have to this effort.
Because we intend to be successful. Labor, business and the American public, left to right, we can come together and build a competitive 21st century America. And we have no time to lose.
Thank you.