It’s Time to Invest in the Infrastructure Communities Need Most
Despite a recovering economy and relatively low unemployment, much of America’s physical infrastructure is in a state of extended disrepair. This is an accepted fact on both sides of the aisle and will require a mutual commitment to action to fix it.
But while the need for increased investment in infrastructure is clear, what is often less recognized is that infrastructure goes well beyond the traditional image of trains, highways, bridges, airports and ports. Local infrastructure is crucial for healthy communities to thrive and broadens the view of where resources are needed: transit to link neighborhoods to business and job centers; affordable housing units for workers; access to clean water and reliable electricity; and internet connectivity.
All are necessary components to create an environment rich with opportunities for its citizens, and without them residents suffer. For instance, linking dislocated neighborhoods to job centers can provide tremendous employment opportunity for residents, but has proven a lingering problem to solve, and it is one that disproportionately—though not surprisingly—tends to affect low-income residents more. In fact, recent data from the JPMorgan Chase Institute found that in Detroit residents made nearly 72 percent of their retail transactions outside their “20 minute neighborhood,” and that low-income residents had to travel 15 percent farther than high-income residents.
Smart infrastructure investments that encourage growth and increase opportunity can clearly help address the shared economic challenges of our communities. Leaders in Washington, working closely alongside the country’s mayors and governors, can be the catalysts for a bipartisan, collaborative investment in America’s infrastructure that engages the business and nonprofit community.
There are already important examples of this collaborative approach at work that can help inspire new thinking:
- The M1 Railway in Detroit, which JPMorgan Chase supports as part of its $100 million investment in the city, links Detroit’s downtown and midtown neighborhoods and shows how infrastructure development can create economic opportunity in distressed neighborhoods. In addition to providing a much needed boost for Detroit’s public transit infrastructure, it also connects neighborhood residents to downtown jobs, and has helped spur development of new retail spaces along the M1 corridor, encouraging entrepreneurs and small business owners to locate in a high-traffic area.
- Support of Community Development Financial Institutions (CDFIs) in Detroit, like Invest Detroit and Capital Impact Partners, is fueling the development of new housing and retail centers in neighborhoods across the city that give residents the chance to live, shop and work locally instead of venturing far outside their neighborhood.
- PRO Neighborhoods – JPMorgan Chase’s $125 million, five-year initiative focused on neighborhood revitalization – works with local and regional organizations around the country to invest in sustainable projects like local retail centers along transit corridors and accessible affordable housing.
- NatureVest, an initiative managed by The Nature Conservancy and supported by JPMorgan Chase, is helping cities like Washington, D.C. accelerate their use of green infrastructure to manage storm water runoff by developing policy standards and financing tools that attract private capital to support these projects—creating both environmental and social benefits. Recently, NatureVest began working in Detroit to provide green infrastructure services to local businesses and provides technical assistance to the City of Detroit as they develop the policy foundation needed to make green infrastructure investments durable.
All of these examples show that in order for investments in infrastructure to be most effective, they have to extend past the shoulder of a highway or the piling of a bridge. We need to make sound, long-term commitments that help disconnected neighborhoods link more closely with available jobs and services, and we must provide support for communities to develop their own business districts and retail opportunities.
Successful infrastructure programs that are designed to have a positive impact on communities are not built with a one or even five-year window in mind; rather they are established to have an impact for decades. To develop an effective approach to this comprehensive national infrastructure investment, we need to constantly evaluate whether the strategies that incorporate local input as well as regional impact set the conditions for long-term economic growth. We need the business community to come together to create urgency around this issue, and to bring its unique capabilities to the table to strengthen the underlying systems required to deliver and sustain progress. Doing so will enable us to address our infrastructure needs at every level, and help expand the pathways to opportunity for communities around the world.
About the author:
Peter Scher is Chairman of the Washington, D.C. region for JPMorgan Chase & Co., serving as the firm’s senior executive in the region. In addition, he serves as the Global Head of Corporate Responsibility. Scher oversees Global Government Relations and Public Policy, Global Philanthropy, the Office of Nonprofit Engagement, and the offices of Sustainable Finance. He is Chairman of the JPMorgan Chase Foundation, one of the largest corporate foundations in the United States. Scher led the development of several of the firm’s major initiatives including the Global Cities Initiative, New Skills at Work, Invested in Detroit and the Global Health Investment Fund. Prior to joining JPMorgan Chase in 2008, Scher was the Managing Partner of the Washington, D.C. office of Mayer Brown LLP and earlier served as the Chairman of the firm's Government and Global Trade Practice.
Scher spent nearly a decade in public service. Nominated by President Clinton, he was confirmed by the United States Senate as U.S. Special Trade Ambassador and served as one of the lead U.S. negotiators on China's entry into the World Trade Organization. He previously served as the Chief of Staff for the U.S. Trade Representative and the U.S. Department of Commerce, staff director for the Senate Committee on Environment and Public Works and Chief of Staff to former U.S. Senator Max Baucus. Scher is active in civic and political activities, serving on the Board of Trustees for American University and the Brookings Institution and the Board of Directors of the Economic Club of Washington, D.C. He is a member of the Council on Foreign Relations and the Atlantic Council task force on EuroGrowth. In 2009, Scher was appointed by the White House to serve as U.S. Representative to the Asia Pacific Economic Cooperation Forum (APEC) Business Advisory Council.