Former Gov. Ed Rendell, D-Pa., and author John McQuaid talk about government spending versus government investment.

 

MSNBC TRANSCRIPT:

>>> from the magnificent hoover dam, right here in boulder city, nevada. 76 years since it opened from business and it still stands as a marvel of american investment, american innovation, and american engineering. the key phrase being ” government investment” as opposed to ” government spending.” welcome. i am dylan ratigan ane? it took 21,000 men five years to complete this unprecedented project, working at times in 135-degree desert heat. the legacy of these men, flood control, crop irrigation, and power generation for some 30 million people and industry throughout the southwest. but the other legacy, government stimulus that works. spending to create jobs while simultaneously solving our nation’s problems. fast forward to now. we live in a world of magic money printing that continues to plunge us into debt while only supporting and propping up special interests, whose time may well have passed due to technology. the question we are asking, in our campaign to bring jobs back to america, who does the american government work for and how can we get that government working for the american people and the american nation? joining us now, former pennsylvania governor and nbc news political analyst, ed rendell. and with us right here at the hoover dam, john mcquaid, journalist and author of “path

of destruction: the devastation of new orleans and the coming age of superstorms.” governor, how do we get more of this?

>> very simply, we’ve got to make our case to the american people that, in fact, infrastructure provides things we need, like the hoover dam, like good levees that will hold in new orleans and cedar rapids. that it’s important for us as a substantiative benefit, but it’s the single best job producer for the middle class we can do, dylan. number one, jobs on the construction site. and number two, jobs back in the factory. just from stimulus spending alone in pennsylvania, orders for steel went up 43% over the previous years. for asphalt and concrete, more than 50%. that meant jobs back in the factories, as well as jobs on the construction site. in fact, our own government says, for $1 billion of infrastructure spending, we ujt?y produce 25,000 wel?)%9

>> what do you think is the core political barrier, and do you have any ideas as to how we collectively, the media, the political construct, and the grassroots of the american people, who surely want this sort of thing, can actually mobilize?

>> well, interestingly, building america’s future, the group that i head up with governor schwarzenegger and mayor bloomberg and the rockefeller foundation, we’re going to release a poll on monday that’s going to show that the american people understand that spending on transportation infrastructure and for that matter, other infrastructure, our dams, our levees, our grid system, our broadband, that those things are things they want to spend money on. we’ve got to convince the policymakers that they shouldn’t be afraid to invest in our growth. there’s not a company in this country, dylan, that became successful that didn’t invest dollars in their own growth. and we need to do the same thing. we either invest or die.

>> yeah, it’s a very simple piece of math, john. you’ve done a lot of reporting on the state of american infrastructure. in a nutshell, what’s your assessment?

>> it’s falling apart. literally, in some cases. i mean —

>> what are some examples?

>> well, i mean, you have the new orleans levee system that was built over 40 years and was a disaster. it basically had errors in the flood walls that caused them to collapse. our roads are inadequate. our airports, our rail systems. i mean, if you go to europe or to shanghai, to berlin, say, and you come back here and you make a comparison, there is none. i mean, it’s pathetic.

>> it’s embarrassing.

>> to what do you attribute that gap?

>> to this mentality that we have that we shouldn’t be spending money. and dylan, you said it right. it’s not spending, it’s investing in our own growth. and we better learn. in new orleans, and john, correct me if i’m wrong, but the army corps had a request for $700 million to repair the levees. no one gave them the money to do it and now the federal governme%t’s laid out over $16 billion for the damage in new orleans.

>> if we take what willie brown was saying yesterday up in san francisco, governor rendell, which is that politicians really just want to keep their jobs. that they’re going to do what they believe is the most likely thing to keep them employed. they’re obviously not afraid to spend money on some things. we’ve been financing wars in the middle east for beyond a decade, by the billion. we see incredible spending on military infrastructure in this country. we’ve seen incredible spending on supporting the banking infrastructure in this country. so it’s not that we’re afraid to write checks or go to the bond market or print money or whatever it is. it’s just confusing, i think, to so many of us, as to why it’s so hard for politicians to feel like maybe i can keep my job by spending some of that money on the things we’re talking about.

>> well, let me tell you why. and john, jump in here, but i think the reason is that infrastructure in most instances isn’t an media need. it’s long range. and politicians have no vision. they’ve barely looked to the next election. but it is something the public understands. in november of 2010, in the worst atmosphere for spending, 61% of the transportation infrastructure referendum issues were approved by the voters. 61%. and those issues called for increased toll, increased taxing, or increased borrowing. the people get it. it’s now time for the politicians to show some guts.

>> go ahead, john.

>> well, a lot of the problem is that congress is on a two-year cycle, congress appropriates money for water projects, like the one behind us, and it can’t sustain a strategy over decades, which is what you need for a lot of infrastructure.

>> well, you mentioned germany, you mentioned shanghai. those governments seem to be running away that doesn’t have the short-term focus that we’re sort of stuck inside of in this country. is that a sffair assessment?

>> yeah. developed countries spend about 3% of their ? gdp on infrastructure. that includes the private sector and the public sector. in the developing countries, it can be 10% or more, as in china. in the u.s., it’s about 2%. so we’re kind of literally falling further and further behind, because we have to both build new infrastructure and maintain the old infrastructure.

>> governor rendell, if you were to look at the current political climate, democratic leadership, republican leadership, the white house, and you were to understand, obviously, the american people want this, the grassroots capacity that exists with modern technology is there, you want this, mike bloomberg wants this, arnold schwarzenegger wants this. the media, whether it’s folks like myself and others are out there advocating for this. where do you think the pressure point in the current political leadership is, whether it’s you, me, the american people, governor schwarzenegger or mike bloomberg could apply pressure to really get a real response?

>> well, i love what you’re doing, because i think the only way washington’s going to move is if they hear from hometown america. and the people have got to say to their legislators, look, it’s okay. we understand that we have to spend money or invest money in certain things and transportation infrastructure, water and sewer, dams, levees, those are important things to our quality of life and our economic competitiveness. go ahead and do it. give president obama credit in his budget. it’s a very robust six-year transportation infrastructure bill. but it’s just transportation. and as john pointed out, we need to do so much more than just transportation. but, folks, right now the american people want jobs, jobs, jobs. nothing produces well-paying jobs like infrastructure, on the job site, and back in american factories.

>> if you were to look at all the infrastructure, the power grid, the transportation infrastructure, everything that really is the guts of making this a civilized country, in a sense, where do you see the most desperate need? can you isolate on any 2 particular aspect of the infrastructure that you really see, john, as in the most dire straits?

>> depends on where you are in the country. definitely, highways are a significant problem. highways are congested, they’re underfunded, and the federal government and local governments are uncertain of how to solve those problems together. rail is also a problem. we have people, governors in the republican party are making a big deal of cutting rail projects at a time when they can take some of the pressure off highways and also build out a new infrastructure.

>> one idea that was proposed to me recently by a couple of executives in a meeting a few weeks ago, governor rendell, was the idea of creating a build america bond that invited american corporations to take all the trillions of dollars that are offshore back onshore to fund those bonds that would be used to build the infrastructure that we need. what do you think about sort of matching the idea of creating an incentive to bring the offshore capital in american profit industry into a bond market that’s designed to fund the infrastructure john’s telling us about?

>> i think it’s a great idea. we ought to be using our bonding power. you know, dylan, it’s interesting. only the federal government doesn’t have a capital budget. every state, every county, every city has a capital budget where we go out and bond for our infrastructure needs. but the federal government doesn’t. and to develop those bonds and use as an income stream for those bonds, bringing that money back from abroad, it’s a great idea. even the little thing that the obama administration did in stimulus, the building america bonds, which paid for about 33% of a state’s debt service, those were enormously successful in spurring infrastructure spending. so that idea is long overdue. we need some form of federal bonding to deal with our infrastructure problem. and look, folks, we’re paying to rebuild the afghani infrastructure, we’re paying to rebuild”t iraqi infrastructure. don’t you think we should invest to rebuild the american infrastructure?

>> you could say that ten times a day on this show, governor rendell. please keep us posted as to your efforts with mayor bloomberg and governor schwarzenegger. we would like to draw as mauch attention to your efforts as we can.

>> we’ll show you the poll when it’s released, showing the american people get it.

>> i believe it. the american people get it ten ways, from health care to education to infrastructure. there just seems to be a communication breakdown when it comes to the media and the political class. but obviously these things take a little more time than all of us like. governor rendell, thank you for the time. john mcquaid, thank you for coming out.