7. Going big on infrastructure

United States

The brief burst of optimism around Joe Biden’s first spell in power has gone. Assisted by just one reactionary Democrat, Senate Republicans have been able to thwart Biden’s main social reforms. But not before the old Capitol Hill hand had extricated from the haggling a $1.2 trillion infrastructure package, capable of passing with some Republican support.

The main elements include repaired roads, universal high-speed internet access and upgraded trains—all obvious productivity-boosting investments that could usefully be pursued in Britain. Is it affordable here? While the ultra-low interest rates we’ve grown used to are now creeping up, once allowance is made for inflation, long-term rates are still strongly negative. So the debt cost should shrink as the benefits for the economy (and the Exchequer) accrue.

Labour has made few clear infrastructure commitments, despite crying betrayal when the Tories reneged on the promised Yorkshire leg of HS2 and the east-to-west “Northern Powerhouse” high-speed railway. A serious vision on rail would be economically useful as well as popular in a region that now has many marginal seats. Action for comprehensive connectivity would transform rural communities dogged by glacial broadband and mobile blackspots and underpin a real “one-nation” pitch. Mending broken roads by rationalising and accelerating the current chaotic repair efforts, would win support from across the spectrum—and get Britain moving again.