Given that America’s infrastructure is on the brink of failure, is there anything Silicon Valley can do to help?
One idea that’s starting to gain traction in tech circles is the civic crowdfunding of expensive municipal infrastructure projects. The basic premise is simple: using sites that look much like Kickstarter or Indiegogo, individual investors (“the crowd”) would pool their money together to build important new infrastructure projects, and in return, would receive perks such as having their name placed on a brass plaque or some other form of recognition for their civic virtue. Here in the U.S., the civic crowdfunding platform Neighbor.ly has already received some attention for its civic crowdfunding initiatives.
Another example of innovative thinking about infrastructure is the crowdfunding of renewable energy projects. In the USA, solar energy crowdfunding site Mosaic has finally received approval to begin reaching out to the crowd to finance solar panel projects in California. While there are some legal concerns here, once individuals transform from “backers” to “investors” (similar to the concerns still swirling in Washington around the equity crowdfunding of startups) the concept is similar to that of crowdfunding a film or any other artistic venture. At the Future of Crowdfunding event in Berlin this April, participants discussed other renewable energy projects that have also been funded with the help of the crowd.
A crowdfunding solution could be a pathway around one of the biggest problems with our nation’s infrastructure: a cash shortage. The problem, quite simply, is that the bucks aren’t there to upgrade our infrastructure. These are the days of austerity and sequestration, so any plan to increase infrastructure spending immediately becomes a political issue. To raise the estimated $3.6 trillion required to fix America’s massive infrastructure, the government would need to raise taxes, issue debt or somehow cut social programs. As a result of these political issues, spending on infrastructure as a percentage of GDP has continued to drop since 2008.
Public-private partnerships, either involving the crowd or of the kind outlined recently by Loews Corporation c-chairman Jonathan Tisch, would seem to be a way around diminished spending capacity by government. When it comes to infrastructure, it’s no longer a case of “we’ll cross that bridge when we come to it.” America’s infrastructure problem is real, it’s immediate, and it’s downright scary.
Yet, when you mention the word “infrastructure” to tech titans, they’re more likely to think of network infrastructure—the guts of our computer and communications systems—rather than the guts of our national infrastructure. After all, Silicon Valley venture capital investors are in the game of funding the Next Big Thing, and bridges, tunnels, and sewer systems simply can’t compare with the latest cool technologies profiled by McKinsey. Instead of placing their long-term hope in “Intelligent Infrastructure” and tricking out America’s existing infrastructure with smart sensors, maybe it’s time to think about promising new business models, such as civic crowdfunding, that have more immediate pay-offs.
Source: Washington Post – Dominic Basulto