The presidential election has generated new proposals for reinvestment in America’s basic social infrastructure: roads and bridges, health care, job training and employment, renewable energy, and education. Barack Obama’s campaign has called for a “National Infrastructure Reinvestment Bank,” which has growing Congressional support, and last January mayors and governors from both major parties formed a coalition to start the rebuilding process.
The current financial crisis will undoubtedly cause short-term public budget cuts as government officials figure out how to pay a staggering bailout bill. But in the long run, it will reduce many leaders’ confidence in market forces and encourage greater interest in public investments in the economy. People will be increasingly reluctant to let financial markets determine their standard of living.