Should We Pay the Rich to Build Infrastructure, Then Pay Them to Use It?

From Our Future

It's starting to look like President Trump's promised $1-trillion plan to rebuild the nation's infrastructure will be as bad for us as his health care plan turned out to be.

Infrastructure Report Card

The American Society of Civil Engineers (ASCE) has issued their 2017 Infrastructure Report Card. We didn't do so well. Our "grade" is a miserable D+. Why? Go outside and look around at our out-of-date and crumbling roads, bridges, dams, airports, water systems, and electrical grid.

President Obama was able to address a bit of the problem in the 2009 "stimulus." This passed because Democrats had super-majority control of the Senate at the time. But then they lost enough seats that Republicans could block things, and block they did. Republicans filibustered everything after that.

Now, after blocking infrastructure projects for seven of the last eight years, Republicans are suddenly talking about how we need to fix our infrastructure. What does this mean?

Trump's "Plan"

Trump's promise to revamp infrastructure has, shall we say, "evolved." Early in the campaign, candidate Trump just said "believe me": he would take care of fixing everything. In his campaign announcement speech he said...

"[We need to] rebuild the country's infrastructure. Nobody can do that like me. Believe me. It will be done on time, on budget, way below cost, way below what anyone ever thought.

"I look at the roads being built all over the country, and I say I can build those things for one-third. What they do is unbelievable, how bad."

By August, his promises had evolved into details -- well, one detail: to "double" whatever Hillary Clinton would invest in infrastructure.

"Her number is a fraction of what we're talking about. We need much more money to rebuild our infrastructure. I would say at least double her numbers, and you're going to really need a lot more than that."

Then, his promises morphed into a plan to sell "infrastructure bonds" to cover the costs. In other words, do things the way they are always done: borrow money to build infrastructure, then pay it back from the resulting economic gains.

By October, the plan had evolved into a $1 trillion promise. Except, it wasn't, really.

"A tax credit would be offered to private companies to finance projects, while the companies would also have to take equity investments in the projects. According to Yahoo Finance, $167 billion of the $1 trillion investment would be equity investment, while the rest would be debt raised by private partners.

"Additionally, all projects built under the plan would be required to generate cash flow, like toll roads or airports that produce tax revenue instead of free parks or highways without tolls. The equity investment partners would also take the revenue, essentially privatizing much of the new infrastructure and making riskier investments more palatable."

Note this key point in Trump's "evolved" plan: "privatizing much of the new infrastructure."

Trump's Plan: Pay Rich People To Build It, Then Pay Them To Let Us Use It

Privatizing infrastructure means We the People won't own it, a few rich people will. We'll then have to pay them to let us use our own roads, dams and bridges.

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