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News from EPI Commitment to public investment should go beyond rhetoric: New data shows investments in infrastructure, broadband and education funding would face severe cuts under most budget proposals

Despite its broad bipartisan support, nearly every major budget proposal put forward during Washington’s “budget season” would cut spending on public investment to historic lows, according to a new paper from EPI Director of Research and Policy Josh Bivens. In Why the Bipartisan Commitment to Public Investment Should Go Beyond Mere Rhetoric, Bivens examines public investment and the effects it has on economic growth. He then analyzes how public investment would fare over the next decade under recently proposed budget plans.

“You hear rhetoric supporting spending on things like infrastructure, broadband and early childhood education on both sides of the aisle, but budget proposals put forward by everyone from President Obama to Paul Ryan slash spending on public investment,” said Bivens. “Cutting public investment hurts the economy now and will have an impact on growth far into the future. President Obama and members of Congress in both parties say they are serious about investing in our roads, bridges and schools, but their budget proposals don’t back this up.”

With the exception of the Congressional Progressive Caucus “Back to Work” budget, spending cuts in the various budget plans would leave public investment at levels significantly below historical precedents by the end of the next decade. For example, by 2023, the plan proposed by Rep. Paul Ryan (R-Wis.) would cut public investment to 1.5 percent of GDP. President Obama’s budget proposal would cut it to 1.7 percent of GDP. By way of comparison, public investment has not been below 2 percent of GDP since the late 1940s.