Obama Skeptical about 'Shovel-Ready' Projects' Long-Term Impact

Obama tells local and state government officials he thought infrastructure was not all that well suited to a quick jobs boost.

A roomful of local and state government officials, transportation industry executives and union officials was holding forth Thursday about how more infrastructure spending would solve the jobs problem, when President Obama strode into the room -- and promptly told the assembled guests that he thought infrastructure was not all that well suited to a quick jobs boost.

The administration, he said, has all year been grappling with the tension between doing stimulus initiatives that deliver a fast jolt to the economy and those that take longer to get underway but are more transformative in the long term. And right now, he said, the economy needed a quicker hit than what big infrastructure projects could provide -- coming closer to an admission than he has before that the current $787 billion stimulus may be moving slow.

"The tension we've been seeing is that what is good for the longer term may not work as an immediate short-term stimulus. We're still getting slapped around in the Recovery Act for this," Obama said. "The term 'shovel-ready' -- let's be honest, it doesn't always live up to its billing."

He added a moment later: "Without the American people seeing this resulting in job growth now, it's hard to get them interested in what's happening down the road." But at the same time, Obama made it sound as if he was not keen on doing more of the road repavings and other faster-acting repairs that have dominated the infrastructure, which he said "may duplicate needs of the past as opposed providing vision."

Obama also scoffed at the notion that the Chinese are trouncing the United States in this regard with their own, more rapid and more extensive infrastructure work. He had seen the fruits of that work on his trip to China, he said, but China was a different place. "The Chinese don't have this thing called democracy we have to deal with -- they're shoveling out a whole lot of money, they're tearing down what's there, conscripting people to do the work," he said.

It was a somewhat jarring culmination of the breakout session, one of six at Obama's "jobs summit," given that the session's whole purpose was exploring infrastucture spending's potential for job creation. Washington state's transportation commissioner urged expanding the $1.5 billion competitive grant program in the current stimulus. An airline executive urged shifting money from high-speed rail to faster-acting upgrades of the air traffic control system. The mayor of Des Moines urged directing more transportation funding directly to cities, bypassing state governments. And many in the room called for an "infrastructure bank" that would use public dollars to leverage private investment.

But then the president came in and made clear he was going to take some convincing. Ltd.