Bad Roads Cost U.S. Drivers More Than $500 A Year

August 3, 2015

America is great at many things, but one area where we could stand some improvement is our transportation infrastructure. According to a report in the Wall Street Journal, our nation's crumbling highways and byways cost drivers more than $500 per year -- and the situation's likely to get worse.

That won't come as a shock to some of you. As we've noted before, roughly one-third of U.S. roads have been rated substandard, and in 2013, we reported that our country's 607,380 bridges needed at least $3.6 trillion of repairs. In fact, 20,808 of them were judged to be "fracture critical".

How has this happened? A big reason for the slow, painful collapse of our infrastructure has been the persistent shortage of funds to repair and improve it. Much of that money comes from the federal gas tax, which hasn't been raised since 1993 and -- not surprisingly -- can't cover the costs anymore. Various solutions to the problem have proposed, including increasing the gas tax and adding toll roads, but none of those ideas have gained traction with tax-averse politicians.

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It's true that state and local funds are available for infrastructure improvements, but many of those sources scaled back spending in the wake of the Great Recession and have kept funding levels low. Between federal, state, and local resources, the Congressional Budget Office says that infrastructure spending has tumbled 19 percent since 2002.

Meanwhile, drivers like us are left to deal with potholes, uneven roads, and worse. That doesn't just make driving uncomfortable, it also pinches our wallets. A 2013 study by the American Society of Civil Engineers said that infrastructure deterioration cost U.S. drivers an extra $324 annually. Estimates from the transportation research group known as TRIP were higher: $516.* 

How do bad roads affect us and our cars? Potholes are perhaps the most obvious examples: they can ruin wheels and tires in a snap. Other bumps can create fractures or cause belts to fray and wobble. We can go out of our way to avoid those trouble spots, but then we're using additional fuel, which costs money. And of course, all those issues cause our vehicles to depreciate in value.

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What's the solution? According to a recent study from McKinsey&Company, the U.S. should raise infrastructure spending from 2.6 percent of GDP to 3.6 percent, a jump of at least $150 billion per year. While that figure seems high, the return on the investment would be some $270 billion to $320 billion in annual economic growth.

Sounds good, right? But don't expect any significant movement on this front until after November 2016. 

* We should point out that TRIP gets some of its funds from construction companies and labor unions, which have an interest in boosting construction spending. And of course, the ASCE wants to keep engineers employed.


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