The Infrastructure of Trust

Infrastructure is a key election issue around the world, in every country it is at the very top of the agenda.

Norman Anderson

The promise to invest in infrastructure gets people elected.  It is also an issue at which candidates once elected routinely fail – in terms of size of investment, types of investment, and benefits created.  Often the entire cycle ends in corruption charges, a bad thing. What is worse is the mortal impact on public trust.  Promises are made, believed, and not kept – and so that spectacular human emotion, hope, is replaced in the minds of citizens across a country by betrayal, anger, frustration, a black hole where trust once resided.

Infrastructure – clean water, transit and highways, energy – goes to the core of who we are.  Its not just that we want better health, more mobility, greater opportunity, its that this is the heart of the contract between public and private, rulers and ruled.  Nobody builds infrastructure alone.  A great project, completed on time, that does what it is supposed to do, tells a people what its government thinks about them, and it tells them what they can be.  In that sense, infrastructure is profoundly, and powerfully, symbolic.  And when it is not done right, when it is over budget, or ugly, or produces few benefits, the impact on us is profound – and when this happens continuously the impact is cumulatively disastrous.

Trust is a nexus word, it connects us, making our communities (and us) powerful and strong, in the best of times, and leaving us weak and impoverished in the worst of times.  It is a big deal, the lifeblood of successful communities.  And at all times when you give your trust, a very big thing to give, by the way – when you vote, for example – you become extremely vulnerable.

In a modern society infrastructure – again, health, mobility, opportunity – is at the heart of what is a deeply emotional contract.    Think about it.

First, you have to trust the future to invest in infrastructure.  No-one is going to transfer present benefits to investments that produce value for 30-40 years without a profound belief in that future.  So when a government promises infrastructure investment that government is making a commitment – governing class, leadership, voters – to doing a world-class job of creating better conditions now, and for the next generation.  This is a big promise, requiring real vision, and planning, particularly in this time of massive technology change.

Second, you have to trust your community to invest in infrastructure. If you believe in maximizing public opportunity, then you build infrastructure – otherwise we would all have private highways, private water treatment, and private airports. The big difference in infrastructure is that the world-class creation of public goods is primary – the very condition on which private enterprise and quality of life reside. It doesn’t matter whether the investment comes from the public or private sectors, what matters is that it produces world-class public infrastructure.  Progress always depends on trust in the public good.

Third, you have to – profoundly – trust your government to invest in infrastructure.  Herein lies the rub.  We have insulted, downgraded and underfunded the planning capabilities of governments for nearly 30 years, and the result in our shrinking western democracies is a dramatic crisis of trust.  Just to provide some numbers, according to the 2018 Edelman Trust Barometer 84% of Chinese citizens trusted their government, and the corresponding total in Singapore was 65%, both countries are well-known infrastructure investors; while in the U.S., Mexico, Brazil and Colombia trust in government numbers were 33%, 24%, 18% and 24% respectively.

So I would argue that trust – creating it, nurturing it, exercising it – is the roadmap to everything in infrastructure.  Think of your marriage, without trust there is an empty hole, with trust everything is possible.  Oddly, but truly, it is the same with infrastructure – with trust, constantly earned and constantly fertilized, everything is possible.

Corruption.  Everyone wants to talk about corruption and infrastructure as if that were a central issue, but that is a dead end, wrong-headed thinking.  Corruption is what happens when there is an absence of trust.  Odebrecht, a very corrupt organization, probably produced more infrastructure, and more benefits, across Latin America, than any organization this century.  If Latin America is going to build infrastructure, and escape the death spiral of corruption (the slowest growing region of the world both in 2017 and 2018), then three actions need to be taken:

  1. Vision & Execution. Leaders need to stop promising what they can’t possibly produce, and recognize that infrastructure investment programs are national programs, 20-30 year visions that transcend electoral cycles.  Countries need to produce national visions, that give everyone in the country a real voice in the creative process.  This involves substantial risks, but it is the only path to real rewards.  With eight elections in Latin America this year, the region is in a unique position to shine a powerful light on a desired future, and then to make that future!  Mexico, with its long interregnum period after the July 1 election is in a uniquely positive position to create a national vision, kicking-off a six year presidential term.
  2. National Asset Accounts. Astonishingly, no government in the region knows what it owns. The region would do well to follow the lead of Sweden, a government that created a national asset map a couple of years ago, and was then in a position to make decisions on optimizing, selling or leveraging assets.  The process is outlined in former minister Dag Detter’s book, the Public Wealth of Nations.  It is likely that, on average, Latin American cities control ten times the number and value of assets that they have on their books.
  3. Strengthen Government. No one trusts what is weak, or incompetent, and what is weak or incompetent does not deserve trust – and certainly will not build infrastructure. At a time of enormous change in the global economy, and an explosion in technology that is transforming infrastructure – from Artificial Intelligence to 3D Printing, and from Smart Cities to energy storage – we need public institutions that can make decisions, take risks, execute effectively and rapidly and ensure world-class asset performance for the 30-40 year life of assets (and as the technology component goes from 3% to well past 10%).

These three actions – make government more capable, figure-out what citizens actually own, and get people involved, deeply involved, in determining where the country is going, creating a national vision – is perhaps the only way to re-inject trust into the infrastructure equation.  Governments and politicians now have to earn the trust of their citizens through real action to build great infrastructure

 


Norman Anderson
President & CEO, CG/LA Infrastructure
Norman F. Anderson is the President & CEO of CG/LA Infrastructure.

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