Oberstar wants $69 billion in new transportation spending

Would act as second stimulus?

Steve Hawley, Dec 04, 09.

US Rep. James Oberstar of Minnesota, who chairs the House Transportation Committee, has called for $69 billion in additional transportation spending, according to the Wall Street Journal.

Oberstar said that the money would provide a badly needed investment in the nation’s infrastructure and create hundreds of thousands of jobs, acting as a second economic stimulus package. The original $787 billion stimulus package, which was approved in February, provided $46.7 billion in transportation funding. Of that total, about 60 percent went to highways, with the remainder going to transit and intercity rail. Oberstar credited the transportation portion of the stimulus act with creating 211,000 jobs and indirectly supporting another 130,000 jobs.

The article reports that Oberstar has not yet received a response from the White House, although “he expects some movement toward his proposal by the end of the jobs summit.” Oberstar is currently at odds with the White House over the renewal of the six-year federal transportation bill, which expired on September 30 but was extended at the last minute. Oberstar and a number of House members want a reformed transportation bill to be passed as soon as possible, while the White House and Senate leaders are pushing for an extension of the current bill through the beginning of 2011. Oberstar has proposed a $500 billion, six-year bill that would be more favorable to transit and would provide $50 billion for high-speed rail.

The Wall Street Journal notes:

Even if Mr. Oberstar and his allies secure more funding, it may not provide an immediate jolt because it takes time for transportation spending to work into the economy as projects are identified, put out to bid and finally undertaken by contractors. In their letter to Mr. Obama, Messrs. Oberstar and DeFazio noted that by the end of October, work had started on about 54% of the stimulus projects funded by major highway and transit programs.

Mr. DeFazio said the lag was acceptable because the economy would be “in the soup” for at least another two years. Mr. Oberstar said the impact from much of the transportation funding from the first stimulus bill would start to fade away by next June.