How Strong Towns Principles Relate to Sioux Falls — The Infrastructure Cult
based on “Strong Towns — A Bottom-Up Revolution To Rebuild American Prosperity” by Charles L. Marohn, Jr.
“The ultimate victory of any ideology is to no longer be considered an ideology, merely truth. Our collective belief in the power of infrastructure spending is now so deeply embedded within our society that we struggle to identify it as a belief, let alone systematically question it. We take it as truth, unequivocally.
A cult is a collection of people having a misplaced or excessive admiration for a person or thing. Since the end of World War II, America’s leadership class has grown to be an infrastructure cult.” — Chuck Marohn
Marohn doesn’t pull any punches when he talks about excessive infrastructure spending. It is hard to disagree with him when we hear about planned multi-million dollar infrastructure projects while at the same time hearing about the dire condition of our existing infrastructure. It is worth getting the book to read his description of the situation. It is an eye-opening read. The key points he makes are that 1) leaders see infrastructure spending as a way to create jobs and give the GDP a short-term boost and 2) the calculations used to show the benefits of infrastructure is really fuzzy math.
Lets briefly look at each point. Infrastructure spending does give the economy a short-term boost from construction jobs but it largely ignores how we will pay for maintaining and replacing the infrastructure in the future — a problem that is coming home to roost in many places (remember the bridge collapse in Minneapolis). Infrastructure often doesn’t build the wealth needed to maintain it — it just creates a liability for future generations.
The second point is that the estimated economic benefits from these projects aren’t based on real money. Projects like adding a lane to a highway tout huge cost savings by reducing travel time. They take the estimated time saved on a daily commute (usually a few seconds) and multiply by the number of commuters affected and the number of trips per year. That gives the projected seconds saved per year. This number is then multiplied times the value of the commuters’ time — usually based on an average annual wage. The resulting number can be huge — like billions of dollars. But are they real dollars? How do those projected savings help pay for the infrastructure? The answer is — they don’t. For example, let's say a worker in a factory is able to get to work 30 seconds faster because of the new lane added to the highway. So he gets to work 30 seconds earlier each day of the week and punches in on the time clock. But the employer doesn’t authorize overtime so the only benefit to the worker is that he gets to go home 2 ½ minutes early on Friday! No additional wages were paid and even if they were there is no way revenue is going to get into the maintenance fund for the highway. No revenue has been generated to pay for the huge investment — that will be left to future cash strapped governments to pay.
So how does the infrastructure cult relate to Sioux Falls? First of all, we need to make it clear that we don’t think local infrastructure spending is a result of a nefarious plot or greedy individuals taking advantage of the situation. However, it does look like the projected financial benefits of many infrastructure projects are not seriously questioned. We have come to believe that all infrastructure spending is good. If we objectively ask how a given infrastructure project will build enough wealth to pay for itself, the answer often is “it won’t”. Let's take a look at a few Sioux Falls projects to get an idea of how much wealth they generate.
The first project we will discuss is the 8th St bridge renovation project. It will cost $5 million to $6 million which is a lot of money but it may actually be an example of how infrastructure spending is supposed to work. The 8th St bridge has a long history. The first bridge was a steel bridge built in 1876 which was destroyed by a flood. The second bridge was built in 1882 but wasn’t big enough for the traffic increase that followed. The current bridge was built in 1912 and is a graceful three arch concrete structure that was added to the National Register of Historic Places in 1993. It was refurbished in 1977. Now, 43 years later it will be refurbished again. This bridge connects the downtown commercial area to neighborhoods on the east bank of the Big Sioux River. It exists because it was needed at the time it was built and is still needed. It has been building wealth by connecting customers to nearby businesses for 108 years. This long history shows the long-term responsibilities a city takes on when it builds infrastructure. It also shows how infrastructure creates wealth to pay for its own upkeep — by raising the value of surrounding property. With renovation (rather than demolition) this bridge may continue to generate wealth for another 108 years.
Now let's look at three other bridge projects — the 26th St and I-229 project, a bridge renovation on E 57th St and a bridge renovation on E 69th St. What the three have in common is that they all span the BNSF railroad. The 26th St bridge is the most costly since it also spans the Big Sioux River. Federal and state funds will pay for most of this work so it is not really a city project. But, the city probably incurred expenses in moving the city park to the west side of the river and building a pedestrian bridge. These three projects are interesting because they appear to be influenced by the infrastructure cult.
Let's take a look at the economic benefits of building these bridges over the railroad tracks. One perceived benefit is safety — the elimination of train/car crashes. Safety is a laudable goal — but are the cost of car/train crashes a serious enough problem to justify the expense? Consider that trains use grade-level crossings in residential neighborhoods in Sioux Falls day and night. If there is carnage on the tracks it doesn’t seem to make the news. Perhaps speed is the issue. All three of these streets are stroads (a Strong Towns term meaning a combination of street and road) that run through new residential developments or soon to be developments. Speeds on these four lane stroads are often 35 to 45 mph (or higher?). Car/train crashes would certainly be more deadly but so would car/bicycle and car/pedestrian crashes. There aren’t any protected bike lanes on these stroads so maybe safety isn’t the issue.
Are these bridges helping to build wealth in those neighborhoods? Well, the areas in question were already connected by roads before the bridges were built so there doesn’t seem to be an economic bump for connecting places that were already connected.
What does that leave? Convenience? Getting stopped by a train on 26th St when you are in a hurry is very annoying. But how do we put a value on “annoying”? And, more importantly, how do we extract revenue from eliminating “annoying” to pay for the projects? Perhaps slowing down trains carrying millions of dollars of product is a concern. However, cars stop for trains — not the other way around so that may not be a major cost consideration either. So, it is hard to see why we build these expensive structures — unless we consider the influence of the infrastructure cult.
Federal and state leaders do not question the idea that building infrastructure creates growth and prosperity. Even when it is obvious that we aren’t maintaining the infrastructure we already have, they are pushing money out to build new projects. They believe building bridges will somehow generate revenue to pay for them without questioning if that can actually happen. The good news is that Sioux Falls seems to be trying to maintain its infrastructure. But, with all the expansive and expensive building going on, how long can that last?
In a previous article related to adding infrastructure to the city on the promise of a short-term economic boost from sales tax we asked “what could wrong?”. Little did we realize how quickly that question would be answered. A financial crisis ignited by a pandemic was not on our radar screen — now it is. With stores closed, sales tax revenues are going to take a big hit. The Strong Towns community believes that building resiliency at the local level is necessary to survive situations like the one we find ourselves in. Having our own food supply so that we don’t have to rely on long and vulnerable supply chains is crucial. Being able to manufacture critical supplies locally would also be an extremely valuable asset. We are relying on a fragile distribution system supported by shaky finances. Now is the time to figure out how to make our town strong and anti-fragile.
Want to check out the book? Buy it here.
