In a commentary on Politico yesterday, Felix G. Rohatyn, former chairman of New York’s Municipal Assistance Corp., urged President Obama to move forward on creating an infrastructure bank that “could help rebuild and repair America’s roads, bridges and ports and also address our serious unemployment problem.” Rohatyn also wrote that the infrastructure bank is necessary “so we can begin to restore America’s infrastructure and strengthen our economy for the long term.”
Rohatyn notes that we should view infrastructure financing as an investment rather than an expense and should establish a national, capital budget for infrastructure. He says China, India and European nations are spending the equivalent of hundreds of billions of dollars on efficient public transportation, energy and water systems. “Here in the United States,” he continues, “a five-year investment of $2.2 trillion is needed simply to make U.S. infrastructure dependable and safe.”
An infrastructure bank funded with a capital base of $50 billion to $60 billion could “easily leverage” $250 billion of new capital in its first few years and as much as $1 trillion over a decade. Rohatyn is best known for helping to prevent the bankruptcy of New York City in the 1970s. He is currently special advisor to the chairman and chief executive officer of Lazard, the financial advisory and investment firm.
Time for a U.S. infrastructure bank