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In: Economics

During the Eisenhower presidency, the Interstate Highway Act was justified as a military defensive measure. What...

During the Eisenhower presidency, the Interstate Highway Act was justified as a military defensive measure. What were the long-term ramifications of this Act (think of the environment, the economy, transportation, demographics)? Was this a good or bad law? Discuss and defend

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Expert Solution

The Federal Government created the Federal-Aid Highway System with a Federal State Funding Ratio, set at 50:50, for a network of rural highways. Proponents of the system, and, highway experts stressed the defence aspect of the system. It was of great importance to the national defence. The Interstate System had its genesis in the 1922 Pershing Map, confirming the military's need for defense highways. Highway needs of the Congressional Defence, a Congressional Report, gave a snapshot of the defence deficiencies this Act could rectify. The highway interstate system was of great strategic importance. 6% of rural miles, and, 6.7% of urban miles were adequate for specific defense highway systems. The 1956 Act was a milestone. The projected cost was $27 billion. There were numerous reasons given for the interstate sytem then, the incremental benefits for the military were not high considering each of the arguments, but it has had an impact on economy, and, transportation.

The Act brought into being one of the wonders of the world. Results of a study carried out on 35 industries, state than costs fell sharply for all except three, by 24 cents for each dollar invested in the highways. It was responsible for 31% of the annual increase in American productivity, in 1950s when the economy was growing at 6% a year. It was 25%, and, 7% in 1960s, and, 1970s respectively. Roads are easier to repair than railways; it had the resilience of Germany's Autobahn system. Eisenhower was an Allied Commander during the Second World War, and, was impressed by the system.


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