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G7 Transport Ministers Meeting Session 1: The Social Role of Infrastructure

Tuesday, June 27, 2017

Remarks Prepared for Delivery by
U.S Secretary of Transportation Elaine L. Chao
G7 Transport Ministers Meeting
Session I: The Social Role of Infrastructure
Cagliari, Italy
June 21-22, 2017

Thank you for that introduction. Good morning to everyone. I am pleased to be here today.

First, let me thank Minister Dario and the government of Italy for hosting this year’s G7 meetings.  Last night was a wonderful display of local food and culture!   This forum provides an opportunity to meet with our global counterparts, discuss key challenges, and share best practices. As the former Secretary of Labor for eight years, I am very well aware and concerned about the social aspects of technology and infrastructure.

Infrastructure plays a central role in supporting and strengthening the U.S. economy, and creating opportunity and good paying jobs for America’s workers.  It is key to increasing productivity across industries and to helping our country remain competitive globally. And it connects millions of Americans to essential services, as well as improving the quality of life.

As you may know, this Administration is proposing a comprehensive plan to rebuild, refurbish and revitalize our country’s infrastructure. 16 different cabinet departments and agencies have been involved in this process, which will also include water, energy and veterans hospitals. The President has proposed investing $1 trillion over ten years with the goals of encouraging self-help, leveraging private sector resources, making targeted federal investments in the most transformative projects, and streamlining project delivery.  This includes $200 billion annually in direct federal spending not only to revitalize current infrastructure, but to build the infrastructure of the future. 

Focusing on the future is so important because the rate of technological change has accelerated. Soon automation will enable automobiles, trucks, trains and drones to talk to each other, and our infrastructure must be able to talk back.  So it is critical that infrastructure keeps pace with, and accommodates, new technology. 

Another key component of this Administration’s infrastructure plan will be streamlining regulatory and permitting processes. In the 1930s it took five years to build the Hoover Dam—one of the most significant infrastructure projects in the United States in the 20th century.  But today, overly burdensome and complex regulatory processes delay infrastructure projects for years—and sometimes decades-- adding billions of dollars to the total cost. Already, the U.S. Department of Transportation is working on regulatory reform.  We have assembled a special task force that has identified numerous legislative and regulatory changes that could streamline transportation project approval. These include eliminating duplicative processes, and allowing concurrent rather than sequential permitting.  Let me note, however, that as we streamline processes, safety will always be number one. 

This Administration is also focused on a comprehensive approach that addresses the needs of both urban and rural communities.

These communities have different infrastructure needs that require different solutions.  It is important to note that most infrastructure spending in the United States is at the state and local level. Currently, only 16% of infrastructure spending is federal. The other 84% is state, local and private investment. So empowering local communities to make their own decisions has always been an important feature of U.S. infrastructure development.

In addition, this Administration proposes to incentivize public-private partnerships (P3s) to spur infrastructure development.   In some states, the private sector is barred from investing in public infrastructure, and this Administration wants to remove these barriers.

As you know, P3s are widely used in many developed countries to leverage public infrastructure spending.  During this forum, I look forward to hearing about the experiences and best practices of other countries in designing innovative public-private partnerships.

Finally, let me mention another critical infrastructure reform that this Administration has launched—the modernization of our country’s air traffic control system. 

By 2020, over one billion passengers will be flying in the U.S. every year.  Air freight is expected to more than double over the next three decades. Without change, our current air traffic control system will be unable to keep up.  Congestion and delays are already costing users and passengers more than $25 billion annually in operating costs and wasted time.

This Administration proposes to free the operation of our country’s air traffic control system from the constraints of government procurements rules to enable the acquisition of state-of-the art technology, Air Traffic Control operations would be moved to an independent, non-governmental, non-profit cooperative. 

The FAA would retain its safety oversight functions and remain at the U.S. Department of Transportation.  This would also solve a long standing conflict of interest issue of an operating entity regulating itself.  And it would enable our country’s dedicated air traffic controllers to have the most modern, up-to-date technology as soon as possible. Legislation implementing these principles was introduced in the U.S. House of Representatives today. 

Let me thank our neighbor to the North—Canada-- and Minister Garneau for their gracious hospitality in allowing us to visit their non-governmental air traffic control cooperative, Nave Canada on March 30, 2017.

Let me close by noting that today’s meeting could not have come at a better time. Every leader here brings a unique perspective on improving infrastructure. And the United States looks forward to exchanging ideas and leveraging our collective knowledge to improve the quality of life for our country and for all member countries of the G-7.

Thank you.