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The road to a competitive future

Prof Dr Uwe Krueger | 01 Feb 2016 | Comments

From the antebellum era, when Congress was urged to “bind the Republic together with a perfect system of roads and canals,” to the rapid expansion of railroads during the Industrial Revolution, to the development of the U.S. interstate highway system after World War II, infrastructure development has propelled the nation toward ever-greater prosperity.

We must never lose sight of this truth. President Obama recently stressed the need to invest in infrastructure because “that's what great nations do.” Yet as we approach an important milestone in U.S. history, the nation’s 250th anniversary in 2026, there are some uncomfortable truths to consider.

U.S. physical infrastructure received a D+ grade from the American Society of Civil Engineers in its last report card, with estimated investment of $3.6 trillion needed by 2020. Putting the challenge into sharper focus, a recent study by the American Road & Transportation Builders Association highlighted that some 61,000 U.S. bridges were “structurally deficient,” many on heavily travelled interstate highways. In an international context, the World Economic Forum’s latest global competitiveness report ranked U.S. infrastructure 11th in the world, despite America’s third-place overall competitiveness ranking. The nation’s historic strength in infrastructure has become a relative weakness.

Clearly, massive investment in U.S. infrastructure is now imperative. This investment will serve the Millennial generation particularly well, ensuring future growth in GDP, creating jobs and raising wages for those just starting their careers, and setting the foundation for continued U.S. prosperity.

But who will fund this urgently needed investment? With increasing pressure on federal and state budgets, it is time to craft new solutions.

Many financial institutions are willing to invest in infrastructure when they can see a clear investment case—along with a stable political and tax environment. Industry must sit at the table with government and the investor community to find approaches that will drive U.S. infrastructure investment.

A few such initiatives are already underway. A new expert group at the World Economic Forum has, for the first time, brought together the major engineering and construction industry players with funding institutions, public and private, on a worldwide basis. The members of this group include large pension funds, private equity players, sovereign wealth funds, and new development banks, most notably the $100 billion Asian Infrastructure Investment Bank. It seems the challenge is not a lack of money, but rather matching available capital to suitable, financeable projects.

As important, government leaders must make the case for infrastructure investment directly with voters. A recent example of this can be seen in Atlanta, which faces an infrastructure backlog of more than $900 million. To help address this urgent need, Mayor Kasim Reed in 2015 initiated an infrastructure bond referendum. Voters approved $250 million in the bond vote to pay for repairs and improvements. This will be the single largest investment in the city’s infrastructure in more than a decade.

Looking ahead to 2026, technology and big data will transform how infrastructure is designed, developed, and maintained—making the investment case even more attractive. Asset owners seek to create long-term value and to effectively manage the total life cycle cost of their assets. New technologies can help create and ensure value through the design, construction, operation, maintenance, and renovation phases of an infrastructure asset, while Internet-linked sensors now allow us to get real-time intelligence about the condition of a building, bridge, or tunnel.

The company I lead, Atkins, sees tremendous opportunities in and for the U.S. transportation market. For example, the market for intelligent mobility—a methodology that connects people, places, and goods across transportation networks, creating end-to-end journeys—is exploding. Intelligent mobility will open up countless new opportunities to improve the transport system by creating a truly integrated platform that delivers travel solutions in a cost-effective and highly efficient manner. By 2026, Americans will increasingly expect seamless travel solutions across their country.

The future looks very exciting with connected, autonomous and semi‑autonomous vehicles set to revolutionise our driving habits, fundamentally reshaping how we design transport infrastructure to intelligently interact with this new generation of vehicles. Cities and their suburbs must prepare now for the coming technologies that will fundamentally change how people move and interact.

In sum, while the challenges ahead are indeed daunting, the capabilities at our disposal are improving exponentially. To ensure that the United States maintains its competitiveness and its position as a global economic powerhouse, we must have greater collaboration among government, infrastructure advisors, and financial institutions, coupled with new technology-led innovations. I believe this formula will create a very bright future for America@250.

Republished with permission from: https://www.atkearney.com/america250/the-road-to-a-competitive-future


On July 4, 2026, America will celebrate its 250th birthday. What kind of nation will it be? What can we do now to shape that future? America@250 is a multiyear research initiative and national dialogue exploring these vitally important questions.