Every four years, the American Society of Civil Engineers’ (ASCE) Report Card for America’s Infrastructure evaluates the condition and performance of American infrastructure. The ASCE assigns letter grades based on the physical condition and needed investments for improvement. The 2025 ASCE Report Card for America's Infrastructure gave the United States an overall grade of C, the highest cumulative grade since ASCE began issuing assessments in 1998. This is an improvement from the C- awarded in the 2021 report and D+ awarded in 2017 and 2013 and the D in 2009. We are moving in the right direction mostly attributed to recent significant investment in infrastructure.
Infrastructure is the backbone of the U.S. economy. It is critical to our nation’s prosperity and the public’s health and welfare. For the U.S. economy to be the most competitive in the world, we need a first class infrastructure system – transport systems that move people and goods efficiently and at reasonable cost by land, water, and air; transmission systems that deliver reliable, low-cost power from a wide range of energy sources to balance intermittent and dispatchable; and water systems that drive industrial processes as well as the daily functions in our homes. Yet our investment in infrastructure had been faltering for decades. We have failed to maintain and expand the infrastructure built by our parents and grandparents.
Only recently, have we as a nation begun to address this. The
grade improvement in 2025 is largely attributed to the Infrastructure
Investment and Jobs Act (IIJA), which has funded over 60,000 projects since
2021. However, while economists generally agree that the U.S. can run budget
deficits for extended periods, doing so perpetually at current
levels is considered unsustainable and carries significant long-term risks.
There are signs that other nations are turning to alternatives rather than the
us dollar as the reserve currency.
Despite the new-high grade of C, aging systems are in need
of more investment. The aging infrastructure is increasingly vulnerable to extreme weather.
The ASCE reports that 27 weather related events in 2024 alone caused over $182
billion in damages. The
Poor infrastructure currently costs the average American household approximately $2,000 to $2,700 annually due to delays and inefficiencies. The costs of doing business and, therefore, prices will increase if surface transportation systems worsen, ports, airports and inland waterways become further outdated or congested, and if water, wastewater and electricity infrastructure systems continue to deteriorate or fail to keep up with changing demand. Increased reliance on electricity to support AI and data-driven systems and industries is particularly important when the cost of service outages and interruptions is business failure. Irregular delivery of water and wastewater services and electricity will make production processes more expensive and divert household disposable income to these basic necessities
However, the United States is no longer as rich a nation as we once were. We are spending more than the nation is taking in. Economists generally agree that while the U.S. can run budget deficits for extended periods, doing so perpetually at current levels is considered unsustainable and carries significant long-term risks. To address the national budget deficit while ensuring necessary infrastructure investments, experts and policymakers have proposed a range of significant spending cuts, increased taxes and alternative financing mechanisms. Balancing these competing priorities should involves a combination of reducing non-infrastructure spending and leveraging private capital, but often involves reducing the investment in maintaining infrastructure.
The Congressional Budget Office (CBO) expects federal debt to reach 118% of GDP by 2035 and potentially exceed 200% by 2049. Net interest outlays are becoming the primary driver of the deficit. In 2026, interest payments are the second-largest federal expense, costing nearly $1 trillion annually. The annual budget deficit is around $2 trillion. This cannot be allowed to continue. Persistently high deficits are projected to cause several "drag" effects on the nation's future. Heavy government borrowing reduces available capital for private investment, which slows productivity and wage growth.
As the national debt grows the nation must pay higher interest rates to induce other nations to buy the debt. We, as a nation, have less ability to respond to crises (recessions, wars, national disasters or pandemics) because a higher portion of the budget is locked into interest payments. Excessive borrowing is already eroding the U.S. dollar's status as the global reserve currency, making it harder and more expensive to finance future debt. Economists also broadly agree that the growing national debt—which surpassed $38 trillion by late 2025 is considered a major risk to long-term price stability
