Infrastructure is defined as the basic physical systems of a business, region, or nation, often enabling the production of public goods or facilitating production processes. Examples of infrastructure include transportation systems, communication networks, sewage systems, water supplies, and educational frameworks.
Investments in infrastructure tend to be costly and capital-intensive but are vital to a region’s economic development and prosperity. Such projects may be funded publicly, privately, or through public-private partnerships.
Key Takeaways
- Infrastructure forms the basic facilities and systems serving a country, region, or community.
- Examples include mass transit, telecommunications networks, and utilities.
- Large-scale infrastructure is typically produced by the public sector and funded by tax revenue.
- Smaller-scale infrastructure may be created by private firms or local authorities.
- Infrastructure can be classified as soft or hard, and both types are essential to the economy and quality of life.
The Foundation of Modern Society: Delving into Infrastructure
The term infrastructure originated in the late 1880s, derived from French, with infra- meaning below, and structure meaning building. Infrastructure essentially means the foundation that supports the structure of an economy, involving systems and structures such as the electrical grid, roads, and bridges.
Infrastructure enables citizens to participate in the social and economic community, providing essentials such as food and water. Financing, control, supervision, or regulation of infrastructure often falls under public realms, evidenced by entities like local or federal governments. For instance, the Cape Henry Lighthouse, built in 1792 in Virginia Beach, was the first federally funded infrastructure project.
Private companies may also invest in a country’s infrastructure for business expansion, benefiting both the company and the country. Likewise, individuals may contribute towards public infrastructure improvements such as upgrading hospitals, schools, or law enforcement efforts.
Different Types of Infrastructure
Hard Infrastructure
Hard infrastructure refers to physical systems essential for running a modern, industrialized nation. Examples include roads, highways, bridges, and their operational assets such as vehicles and transit buses. Networking equipment and technical systems that support business operations are also considered hard infrastructure. According to a Brookings Institution report, infrastructure-related jobs account for nearly 11.8% of the workforce in the U.S.
Soft Infrastructure
Soft infrastructure encompasses human capital and institutions vital to services like healthcare, financial services, governance, law enforcement, and education. Investments in soft infrastructure, such as expanding Medicare and promoting tuition-free community college, focus on enhancing daily life. President Biden’s Build Back Better Plan proposed significant investments in such initiatives.
Maintaining and Funding Infrastructure
Maintenance and funding of infrastructure largely depend on ownership. Generally, state and local governments own the infrastructure for transportation, water, and education, often partially supported by federal subsidies. Some infrastructures, like telecommunications, may be entirely privately owned.
Public-private partnerships (PPPs) also play a role in maintaining infrastructure. For example, the Cintra and City of Chicago lease agreement for the Skyway Bridge includes revenue-sharing and relieved the city of maintenance responsibilities for 99 years while providing a $1.82 billion cash infusion.
Significant U.S. infrastructure plans include the American Recovery and Reinvestment Act of 2009 and the 2021 Infrastructure Investment and Jobs Act, which allocated $1.2 trillion for nationwide infrastructure development, from roads to internet access. The 2021 package also introduced incentives for building electric vehicle infrastructure and reducing digital divides by providing affordable high-speed internet.
Evoking Change: Digital Divide and Electric Vehicles
Addressing the Digital Divide
The COVID-19 pandemic exposed significant gaps in internet broadband access across the U.S. Funding from the Infrastructure Investment and Jobs Act (IIJA) targets ensuring reliable high-speed internet for every American, closing digital divides influenced by geographic and socio-economic disparities.
Embracing Electric Vehicles
The IIJA includes robust provisions for developing the country’s EV-charging infrastructure, with plans to install 500,000 publicly accessible charging stations by 2030, fostering a future of sustainable transportation.
The Societal Importance of Infrastructure
Infrastructure is the bedrock upon which businesses function and economies thrive, connecting workers to jobs and citizens to essential services like healthcare and education. Reliable infrastructure fosters community opportunities, supports supply chains, and facilitates the movement of goods and services, ultimately enhancing societal stability and economic prosperity.
Related Terms: Public-Private Partnerships, Economic Development, Public Goods, Soft Infrastructure.
References
- Federal Emergency Management Agency (FEMA). “Infrastructure”.
- Merriam-Webster. ‘“Infrastructure’: A New Word from Old Roots”.
- American Society of Civil Engineers. “Old Cape Henry Lighthouse”.
- Brookings Institution. “Seizing the U.S. Infrastructure Opportunity: Investing in Current and Future Workers”.
- The White House: Biden Administration. “The Build Back Better Framework”.
- Ferrovial. “Chicago Lease Agreement Signed”.
- U.S. Department of Transportation. “Fixing America’s Surface Transportation Act or FAST Act”.
- Federal Communications Commission. “American Recovery and Reinvestment Act of 2009”.
- National Conference of State Legislatures. “Infrastructure Investment and Jobs Act: Implementation and Key Resources”.
- The White House. “Updated Fact Sheet: Bipartisan Infrastructure Investment and Jobs Act”.
- The White House: Biden Administration. “FACT SHEET: President Biden and Vice President Harris Reduce High-Speed Internet Costs for Millions of Americans”.
- The White House: Biden Administration. “Fact Sheet: Biden-Harris Administration Announces New Standards and Major Progress for a Made-in-America National Network of Electric Vehicle Chargers”.
