Can Highways Heal the Rust Belt?

Highway money may not be fungible, but political capital is – and every moment local officials spend trying to secure funding for new highways is time they could spend addressing the real issues that actually stand between success and failure for Rust Belt communities in the 21st century.

Everybody these days seems to have a prescription for what ails the Rust Belt.

For President Trump, that prescription seems to be some form of government action to reopen the region’s coal mines and steel mills in an attempt to recover lost industrial glory. At the other extreme are policy wonks and academics who argue that at least some Rust Belt cities and towns are doomed and should be allowed (or encouraged) to die.

The question of what to do about the Rust Belt isn’t new. It was in the air when I was growing up near Pittsburgh in the 1970s and 1980s, and has never really gone away.

Historically, the solution often floated by local officials has been to lure a “big ticket” investment – a new factory (often attracted with hefty tax incentives), a tourist attraction, or a shiny new piece of infrastructure. These schemes have often been absurd. A favorite of mine was a 1990s proposal to give Pittsburgh a head start in the market for magnetic levitation (maglev) trains by building a $147 million demonstration line linking a 5,000-space parking garage with the city’s hockey arena. The proposed length of the rail line: 2,200 feet, a distance that could easily be covered by the average person on foot in about 10 minutes. Despite years of conversation, the plan never left the station.

Highway expansion megaprojects are among the big-ticket investments often seen as economic saviors for moribund local economies. Together with our partners at the U.S. Public Interest Research Group (U.S. PIRG), my organization has called attention to highway expansion projects around the country that fit the Google definition of “boondoggle”: “work or activity that is wasteful or pointless but gives the appearance of having value.”

Highway expansion projects certainly give the appearance of having value. Nobody likes traffic, highway construction provides at least a short-term shot in the arm to local economies, and the idea that a new highway might lure business and economic activity to an area seems intuitive.

But does highway expansion actually create long-term economic value? There is a lot riding on the question for the Rust Belt. Our two “Highway Boondoggles” reports (a third is due out next month) have included a surprising number of projects in and around Rust Belt cities: the $331 million “Opportunity Corridor” highway in Cleveland; the proposed $2.7 billion widening of I-94 through the heart of Detroit, a $429 million bypass now under construction around the southern Ohio city of Portsmouth, and the proposed $2.1 billion Mon-Fayette Expressway through the “Steel Valley” outside Pittsburgh.

Economists generally believe that construction of the Interstate Highway System did increase economic productivity in the decades after World War II. But evidence has mounted that the economic boost from highway construction was a one-shot deal, and that we have long since entered the era of diminishing returns. The main effect of present-day highway construction, it is now believed, is to redistribute economic activity – from city centers to new-build suburbs or from one town to another – not create it. In a region like western Pennsylvania, which has been hanging on by its economic fingernails for decades, spending more than $2 billion on a road like the Mon-Fayette Expressway would likely result in simply redirecting economic activity from one location in the region to another.

Now, if you are a business leader or a mayor in a struggling, formerly industrial town, that may still sound pretty OK – except for two things. The first is that highway construction often undermines the existing working economic assets of a community. Evidence for this comes from the federal government’s half century-long (and counting) experiment with using highway construction as a vehicle for economic development in Appalachia. A 2012 study of those efforts by the Appalachian Regional Commission and researchers at the University of Tennessee found that:

“Although transportation-focused efforts encourage business development in some areas, they often have a negative impact on the vitality of downtown areas, existing business districts and adjacent neighborhoods. While better roads improve access and can reduce isolation, they cannot by themselves transform failing schools or resolve long-standing community conflicts.”

The second problem is that highway construction comes with a heavy opportunity cost. Money spent on highways may not be immediately transferrable to other purposes, but the increasing amount of general fund money now being funneled into highways in the United States is money that could clearly be spent on other, more pressing needs. Most Rust Belt metropolitan areas have been stagnating in population for decades, with levels of traffic congestion that may be annoying but are unlikely to get much worse. Meanwhile, crises in education, housing, opioid addiction, the fiscal viability of local governments, and the basic maintenance of streets and other public infrastructure cry out for resources and attention.

Highway money may not be fungible, but political capital is – and every moment local officials spend trying to secure funding for new highways is time they could spend addressing the real issues that actually stand between success and failure for Rust Belt communities in the 21st century.

The good news is that local leaders are beginning to figure this out. The Mon-Fayette Expressway was back in the news recently as the regional planning organization for southwestern Pennsylvania debated whether to keep the project in its transportation plan. (It ultimately voted to table the decision, leading the Pennsylvania Turnpike to cease work on the highway and leaving the project’s future in doubt.) While some local leaders have continued to support the project, others have begun asking tough questions.

“I would like to hear whether highways being built in the last 10 years anywhere in the United States have actually helped this sort of older manufacturing-base communities or do they just allow traffic to bypass them and go on to greener pastures,” asked one member of the commission, as reported by the Pittsburgh Post-Gazette.

The evidence for the economic effectiveness of new highways is unlikely to come from elsewhere in western Pennsylvania, which has built several new expressways in recent decades, with little apparent effect. The completion of the Beaver Valley Expressway in the early 1990s, for example, was seen as a spur to economic growth in a struggling industrial area. But, as a local official from the area recently told the Post-Gazette: “It was going to be our lifeline, but it wasn’t.”

Where might local residents and officials choose to spend the money currently devoted to projects like the Mon-Fayette Expressway? Mostly, on the kind of small-bore projects that can make an immediate difference: fixing local streets and bridges, improving public transportation (especially transit that connects local residents to the growing number of jobs in the regional hub, Pittsburgh), and “Complete Streets” redesigns that make travel safer for people on foot or on bike. Moreover, by opposing highway expansion projects that fuel suburban sprawl (the Mon-Fayette Expressway is intended to connect to a proposed “Southern Beltway” around Pittsburgh that would likely be a sprawl-inducing machine), local leaders hope to refocus investment in existing local business districts and town centers.

Can a locally oriented strategy of small-scale transportation investments bring back the Rust Belt’s “glory days”? Phrasing the question that way presupposes that a return to a manufacturing-based mass employment economy for the region is even possible – which it may not be.

It is quite likely, however, that these kinds of investments can do more to make life better for local residents than a highway megaproject – and do so at a fraction of the cost. And that kind of approach to Rust Belt restoration – which builds from the ground up, rather than awaiting the arrival of a savior from afar – may be the region’s best hope for restoring health to communities that have long been left behind.



Tony Dutzik

Associate Director and Senior Policy Analyst, Frontier Group

Tony Dutzik is associate director and senior policy analyst with Frontier Group. His research and ideas on climate, energy and transportation policy have helped shape public policy debates across the U.S., and have earned coverage in media outlets from the New York Times to National Public Radio. A former journalist, Tony lives and works in Boston.