China laying tracks for 1,000km/h maglev trains

Dropping taxes on companies has nothing to do with it. Many European countries have lower corporate taxes than we do, and no OECD country raises significant revenue from corporate taxes. It’s a red herring and a distraction. The issue is we have a political system that makes infrastructure enormously more expensive and hard to build than in Europe (much less China). In Maryland, people are lobbying to get light rail stations torn down that have already been built! The average time spent in “environmental review” for a government project is 5 years, and its really just an opportunity for a small minority to hold up and delay infrastructure projects. But that system is a reflection of our values. We don’t build things because we would rather prioritize other values.

That is what it is. We are good at other things! We’re good at things like Silicon Valley, that don’t require centralized cooperation and people falling in line. Lots of countries have the political discipline to build rail. But there is no other Silicon Valley! (What more needs to be said about why California doesn’t have rail, beyond noting that the state’s most significant industry is based in the suburbs/exurbs of an otherwise second tier city?)

1. Corporate income taxes don’t generate much revenue, and the revenue they do bring in is even smaller relative to the amount of harm and economic distortion it causes. It really only carries on because it’s a useful political football and because having it appeals to a certain sense of “fairness.” There’s really no correlation between corporate taxation and infrastructure, and we might even be better off without the former altogether.

2. The US does spend a lot every year on infrastructure, but it gets relatively little bang for its buck, especially in comparison to places like China; even other advanced economies (France, UK, etc.) seem to be better at controlling costs for these types of projects.

3. We also spend a ton of money every year on precisely the wrong type of infrastructure. The Federal government, in addition to every state and local government, spends enormous sums every year on not only maintaining existing roads, but also widening, adding lanes, or even building new ones. In fact I remember reading that something like one out of every two dollars spent on roads goes to build new ones, even as people decry that the government isn’t adequately maintaining the roads that already exist. That’s insane - but it’s tied up in how funds are allocated, cost sharing agreements, etc. that often comes out of Congress. In short, the Feds will pick up an enormous proportion of the tab for building new state and local roads, but contribute very little to maintaining them. It should be easy to see, then, that building new roads is often more lucrative for contractors, politicians, governments, etc. than simply maintaining what they already have.

4. All the money we just talked about spending on roads is money that was not spent on upgrading sewers, water, power, public services, and everything else that help support denser urban areas like New York. So in effect, we are starving economically vibrant cities like NY of federal funds at the same time we subsidize the continued expansion of suburbia, none of which have the density required to make massive investments in things like railroads anywhere close to economically viable.