(WSJ) Construction Job Cuts Loom as Stimulus Fades

The sugar rush is over now time for the crash...again.

Highway-construction companies around the country, having completed the mostly small projects paid for by the federal economic-stimulus package, are starting to see their business run aground, an ominous sign for the nation's weak employment picture. Tim Word, vice president of Dean Word Co., a heavy-construction company in New Braunfels, Texas, said his income is now coming mostly from projects that are winding up. He said that in normal times he has about $100 million of signed contracts in hand. But that number has fallen to $30 million, and the pipeline is empty. In the past two years, his work force has shrunk nearly 40% to 260 from 420. "Having something to bid on is the lifeblood of the industry, and it's running out," said Mr. Word. He isn't sure what will happen next year without new projects. "There's no pavement fairy that's going to help." .....State officials and local contractors trace the industry's woes to the recession and the collapse of the residential and commercial real-estate markets. In addition, they cite the federal government's delayed plans to enact a transportation bill. In one version, the law would have provided $450 billion for highways and infrastructure projects over the next six years. Congress is no longer actively considering the bill, which has been bumped aside by competing priorities such as the Obama administration's health-care overhaul and by growing support for reducing the federal budget deficit. Some lawmakers fear that continued stimulus spending could harm the economy down the road by saddling the nation with higher debt-servicing bills. But high unemployment could revive the transportation-spending bill's prospects. Earlier this year the Obama administration was opposed to pushing a big highway bill, deterred in part by the prospect of raising gasoline taxes to pay for it. Faced with a 10.2% jobless rate, however, officials here are rethinking their stance. Thursday, the White House will hold a "jobs summit" to discuss ideas, which are likely to include shifting some spending to transportation projects.

Nothing says smart power than raising the gas tax to pay for projects paid for by debt that the public has to pay back at a higher rate. Its just a shell game people and we will be paying for it hard.