Infrastructure Investment

This post originally appeared on Orphan Road.

Great piece by Richard Florida in the Atlantic. Lots of stuff worth quoting, but this in particular caught my eye:

In his forthcoming book, The Wealth of Cities, my University of Toronto colleague Chris Kennedy shows that only wholesale structural changes, from major upgrades in infrastructure to new housing patterns to big shifts in consumption, allow places to recover from severe economic crises and to resume rapid expansion. London laid the groundwork for its later commercial dominance by changing its building code and widening its streets after the catastrophic fire of 1666. The United States rose to economic preeminence by periodically developing entirely new systems of infrastructure—from canals and railroads to modern water-and-sewer systems to federal highways. Each played a major role in shaping and enabling whole eras of growth.

This is what people are getting at when we talk of infrastructure as investment. It facilitates commerce, and makes everything cheaper. The internet, for example, has to be seen as one of the most incredible infrastructure investments of the last 50 years. One big reason newspapers are dying is that the internet has simply decimated the costs of customer acquisition for businesses. You don’t need to run full-page newspaper ads when you can put up a website and optimize it for search engine traffic.

Transportation infrastructure works in much the same way. Building a high-speed rail link between two cities drops the cost of connecting those cities, culturally and commercially. In fact, transportation infrastructure and the internet are more linked than they might initially appear.

Years ago, we assumed that computers would lead to the "paperless office." They didn’t. One reason is that paper is simply an artifact of the amount of information we’re creating. And computers exponentially increased our information output. More recently, technology was heralded as having the capacity to reduce travel (telecommuting, teleconferencing, etc.). But travel seems to be increasing, probably because the internet is facilitating connectedness. How many times in the last few years have you made plans to visit friends in other cities that you’re only still in touch with because of Facebook?

The bottom line is that advancing telecommunications technology will accelerate our need for transportation infrastructure. So we’d better get building!