The United States' Eisenhower Interstate Highway System was the biggest, most expensive public works project since the Pharaohs had the Pyramids built.
The Interstate System, started in 1956, became the envy of the entire world, except perhaps Germany, symbolizing a nation on the march to progress - a four-lane wonder stretching from sea to shining sea.
But now, in the early decades of the 21st century, that once-vaunted highway network is overwhelmed, underfunded, and flat out crumbling in parts.
Interstate 5 is the West Coast's main artery, spanning the distance from Canada to Mexico. Last week, a portion of Interstate 5 fell into the Skagit River north of Seattle.
The Skagit River Bridge was 58 years old, and listed as "functionally obsolete," meaning the bridge was safe but did not meet current standards. No one was killed, but three people were injured as their vehicles plunged, along with the bridge's deck, into the river.
Thirteen people were killed and 145 injured in August 2007 when a bridge carrying Interstate 35W across the Mississippi River at Minneapolis collapsed during rush hour. In that tragedy, the bridge was found to have been over its weight limit, and some non-critical components had been corroded by, of all things, bird droppings.
Failing Grades for Roads, Bridges
Not surprisingly, the American Society of Civil Engineers has given American road infrastructure a D grade and bridge infrastructure a C+.
Of particular concern are those bridges. ASCE estimates that 200 million daily trips in the country's 102 largest metro areas are made over bridges that are deficient in some way. It's not surprising, given that the country's 607,380 bridges have an average age of 42 years. That's fairly long in the tooth for vital infrastructure.
According to the Federal Highway Administration, the government needs to invest $20.5 billion annually to get America's bridges into shape. But current annual investment is just $12.8 billion, around $8 billion short of the total needed.
Roads in general are even more demanding of attention. The Federal Highway Administration says that a hefty $170 billion per year is needed to improve capacity and performance.
Who's likely to step into the gap (or maybe we should call it the pothole)?
The companies that step in to pick up the slack are likely to be larger ones, with decades of experience and a global presence. That's not to say there won't be any room for the little guys, at the local level, but there will be a need for giants.
When these engineering firms set to work, they can accomplish wonders for infrastructure - and shareholders.
Here are some of the likely players, and how to invest to profit from this infrastructure makeover.
How to Invest in Infrastructure Repairs
An investor might arrange across-the-board exposure by investing in an infrastructure mutual fund. These usually have a global focus, rather than dealing with any coming American build-out.
These mutual funds are usually resistant to economic downturns, for the simple reason that governments the world over spend, spend, spend when the economy is bad. A great deal of that money is spent on infrastructure.
The Morgan Stanley Global Infrastructure Fund Class A (MUTF: UTLAX) maintains exposure to worldwide infrastructure spending. Morningstar gives it a five-star rating overall. It's currently trading at less than half its early 2000s highs, but has been on a consistent upswing over the past four years.
Pasadena, CA-based Jacobs Engineering Group Inc. (NYSE: JEC) should play a role in any attempt to upgrade the national infrastructure base. The company has a worldwide presence on engineering and infrastructure projects. Jacobs works in places that are considerably further behind than the United States.
About 87% of the shares are institutionally owned, and the company pays no dividend. The stock has shot from $33.61 to $56.59 over 52 weeks, and is sitting fairly close to its 52-week high now.
URS Corp. (NYSE: URS) is another huge construction and engineering firm that operates all over the world. The company has operated since 1904, going through a long-lived round of expansion in the 1970s and 1980s.
URS is a one-stop shop for infrastructure build-out, offering everything from architectural services to consulting to construction. This stock, now at nearly $49, is also trading close to its 52-week high, and yields 1.73%.
If you're looking to play the nuts and bolts side of this road-building enterprise, consider a construction equipment company, like Kubota Corp ADR (NYSE: KUB). The company's stock has had a big year, with a 52-week run from $40.61 up to $88.38. The stock has settled somewhat and is now in the upper $70 range.
Kubota is based in Osaka, Japan, but has worldwide operations, with Gainesville, GA's Kubota Manufacturing of America producing front loaders, backhoes, and all manner of construction equipment. Kubota has at least four American subsidiaries, employing American workers under mostly American management.
Repairing all of America's infrastructure, bridges and roads included, is going to cost about $3.6 trillion, but the savings in lost time, maintenance, and even human life are going to be well worth the cost.
As things stand, ASCE estimates that close to 42% of America's urban highways remain congested, costing us $101 billion in wasted time and fuel.
But with a newly upgraded highway system, complemented by efficient rail and aviation networks, the United States would be well on the road to regaining its place at the top in transportation.
For more on how to invest in U.S. infrastructure repairs, check out Stocks to Buy Now Before the U.S. Infrastructure Spending Boom