tag:blogger.com,1999:blog-25089246.post754564807100488490..comments2024-02-07T08:30:28.786-08:00Comments on U.S. Telecom Infrastructure Crisis: Tennessee cooperative official compares 1930s electrification to today's telecom infrastructure challengeFred Pilothttp://www.blogger.com/profile/18352861125794506929noreply@blogger.comBlogger1125tag:blogger.com,1999:blog-25089246.post-81076599099479155152015-10-29T12:57:11.179-07:002015-10-29T12:57:11.179-07:00And funding is everything. There was a time in thi...And funding is everything. There was a time in this country when banks were the major investor in infrastructure. Infrastructure generally has the kind of returns that ought to attract bank financing. But for a fairly long number of reasons bank stopped investing in infrastructure starting in the 1920s and today it's rare to find bank financing except for those cases where the federal government will provide a hedge against the interest rates and against default (such as with USDA guaranteed loans).<br /><br />The problem is that non-government entity has ever stepped into that funding gap and so we have gone through a long number of years where municipal bonds or federal budgets paid for most infrastructure. But we have reached a time when a lot of local government entities have run into their bond caps, meaning they can't easily borrow more money, and so the predominant way we've funded new infrastructure for the last forty years is drying up. <br /><br />There are some ways that other sources of money can be brought to bear on the issue and private money is starting to consider funding these kinds of projects. There is a lot of money sitting in pension funds, college endowments, insurance companies and other large pools of cash that ought to be interested in the 10% returns that can come from infrastructure investing. But for the most part this is a nut that has not been cracked and so there are now literally trillions of dollars of needed investments that are not being made, or are not even being considered since there is no easy path to funding them. Anonymoushttps://www.blogger.com/profile/17541176611916586616noreply@blogger.com