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Without regulatory reform, the Biden infrastructure bill will fail

By Conn Carroll

The New York Times has published a fine op-ed by Center for Growth and Opportunity at Utah State University senior fellow Eli Dourado arguing that the U.S. economy needs to get a lot better at building physical stuff. He notes:

One reason venture capitalists have invested so much in software companies and relatively little in transformative physical-world technology is that the returns in software come faster and face less regulatory risk.

One of the big “regulatory risks” Dourado correctly identifies is the National Environmental Policy Act. Dourado explains:

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The act slowed progress in infrastructure. Per-mile spending on the Interstate System of highways tripled between the 1960s and the 1980s, with the inflection point coming in the early 1970s, when NEPA took effect. And in practice, the citizen voice function of NEPA has been used not to enact environmental justice but to let wealthy communities oppose projects — including transportation and public works projects — that inconvenience them. To protect against community opposition, environmental impact statements under NEPA have ballooned over the years and now take an average of four and a half years to complete. One that was finalized in 2019 took almost 16 years.
…

Environmental review has far-reaching economic and social consequences. It slowed the 2009 economic recovery, as infrastructure projects specified in the American Recovery and Reinvestment Act were subject to at least 192,705 NEPA reviews. Projects funded through this year’s infrastructure bill will undoubtedly face similar delays.

And this is all true. NEPA did cripple Obama’s trillion-dollar stimulus, and it will also cripple Biden’s infrastructure bill if it does pass Congress.

However, it should be noted that Republicans offered an amendment to Obama’s stimulus bill that would have exempted all stimulus projects from NEPA regulations. Democrats rejected it.

Democrats also rejected efforts to exempt Biden’s infrastructure bill from commonsense NEPA reforms.

We are not going to be able to build great things again until Democrats get serious about regulatory reform.

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