Even in the wake of “Infrastructure Week”, President Trump's infrastructure plans remain a vague promise—$200 billion in federal funds leveraging $800 billion in private capital (in return for generous tax breaks) and the contribution of state and local funds over ten years in unspecified, one-off urban and rural projects. This blank slate might not only comprise transportation projects, but also broadband, water and sewer, dams and even veterans hospitals and schools. The outline of the proposals also encourages states and cities to sell operating rights for toll roads, airports, rail stations, and water-sewer plants to private managers in various forms of public-private partnerships that would help fund projects. At the same time, the President's budget proposes cuts to basic maintenance outlays for various infrastructure systems like road paving and sewer repairs—robbing Peter to Paul?
After stonewalling President Obama's repeated calls for infrastructure funding, the GOP-controlled Congress and particularly its Tea Party element likely will be loath to legislate big ticket projects underwritten by federal taxpayers. That's why the President counts on encouraging private sourcing solutions in his program, which tries to give the appearance of getting more for less.
That may all be palatable to single-minded, deficit hawks and federal tax cut proponents, but this course only shifts how the public would ultimately pay for shoring up ageing and now inadequate systems and building new 21st century networks. One way or another the very large costs would be picked up by the taxpayer, rate payer or user—in fees like tolls and fares, bond payments by future taxpayers, or special assessments in local or state taxes. PPP strategies are basically a shell game to make it seem like infrastructure can be more affordable and promote the notion of how profit making enterprise will produce less expensive, more efficient outcomes than ”wasteful” government-run systems. The results in PPP projects have been decidedly mixed. But the biggest shell game of all is continuing to push the funding burden from federal to state and local agencies. In the end we pay someone in some way—is it the IRS, a local property or sales tax, a bridge toll, higher subway fare, bigger water bill? You get the idea.
Enlarging the infrastructure scope and highlighting a trillion dollar initiative sounds huge, but then consider the 10-year time frame—does that mean the direct federal contribution is a very meager $20 billion a year? That kind of outlay would be less than the severe underfunding of the past three decades which has put the nation's transport systems in their state of crumbling dysfunction. And we would presume the private sector will make up the difference, while seeking annualized returns in the advertised 10% range? And this would be a good deal for taxpayers?
Meanwhile, we hear little talk envisioning game-changer multi-modal transportation solutions, which would link airports to downtowns and rail stations by new regional mass transit networks. These networks could help take the burden off of urban highways, which are practically beyond the point of congestion management and link satellite cities into the major 24-hour economic engines. Or will driverless cars fix that? Those autonomous vehicles will still require functioning roads, bridges, tunnels and overpasses, many of which need total overhauling not just repaving. New stations could be planned around housing and commercial nodes, providing more TOD opportunities for developers. Ports and airports will need special freight links too, which connect into national transport networks for speeding delivery and supporting economic growth rather than perpetuating gridlock. Funding a bunch of one-off projects for ribbon cuttings will be just more of the same pork barrel politics. Remember the bridge to nowhere?
The price tag for all this is well beyond $200 billion or even $1 trillion for just transport projects, taking into account the necessary maintenance and repairs on existing systems. I haven't mentioned revamping and rebuilding inadequate and rapidly ageing sewage treatment systems, the cyber-attack vulnerable electric grid, crumbling dams, or out-of-date air-traffic control system (the President's solution is to privatize). I can go on and on. Just add onto the bill.
If we want to put America first and keep the country great—we need to start planning smart and funding projects that fit into long-term regional plans. That's also how we will create jobs. But there is no way to avoid the very large cost.
In the meantime, it appears we are still headed down the very dead end of getting little for less.
Even in the wake of “Infrastructure Week”, President Trump's infrastructure plans remain a vague promise—$200 billion in federal funds leveraging $800 billion in private capital (in return for generous tax breaks) and the contribution of state and local funds over ten years in unspecified, one-off urban and rural projects. This blank slate might not only comprise transportation projects, but also broadband, water and sewer, dams and even veterans hospitals and schools. The outline of the proposals also encourages states and cities to sell operating rights for toll roads, airports, rail stations, and water-sewer plants to private managers in various forms of public-private partnerships that would help fund projects. At the same time, the President's budget proposes cuts to basic maintenance outlays for various infrastructure systems like road paving and sewer repairs—robbing Peter to Paul?
After stonewalling President Obama's repeated calls for infrastructure funding, the GOP-controlled Congress and particularly its Tea Party element likely will be loath to legislate big ticket projects underwritten by federal taxpayers. That's why the President counts on encouraging private sourcing solutions in his program, which tries to give the appearance of getting more for less.
That may all be palatable to single-minded, deficit hawks and federal tax cut proponents, but this course only shifts how the public would ultimately pay for shoring up ageing and now inadequate systems and building new 21st century networks. One way or another the very large costs would be picked up by the taxpayer, rate payer or user—in fees like tolls and fares, bond payments by future taxpayers, or special assessments in local or state taxes. PPP strategies are basically a shell game to make it seem like infrastructure can be more affordable and promote the notion of how profit making enterprise will produce less expensive, more efficient outcomes than ”wasteful” government-run systems. The results in PPP projects have been decidedly mixed. But the biggest shell game of all is continuing to push the funding burden from federal to state and local agencies. In the end we pay someone in some way—is it the IRS, a local property or sales tax, a bridge toll, higher subway fare, bigger water bill? You get the idea.
Enlarging the infrastructure scope and highlighting a trillion dollar initiative sounds huge, but then consider the 10-year time frame—does that mean the direct federal contribution is a very meager $20 billion a year? That kind of outlay would be less than the severe underfunding of the past three decades which has put the nation's transport systems in their state of crumbling dysfunction. And we would presume the private sector will make up the difference, while seeking annualized returns in the advertised 10% range? And this would be a good deal for taxpayers?
Meanwhile, we hear little talk envisioning game-changer multi-modal transportation solutions, which would link airports to downtowns and rail stations by new regional mass transit networks. These networks could help take the burden off of urban highways, which are practically beyond the point of congestion management and link satellite cities into the major 24-hour economic engines. Or will driverless cars fix that? Those autonomous vehicles will still require functioning roads, bridges, tunnels and overpasses, many of which need total overhauling not just repaving. New stations could be planned around housing and commercial nodes, providing more TOD opportunities for developers. Ports and airports will need special freight links too, which connect into national transport networks for speeding delivery and supporting economic growth rather than perpetuating gridlock. Funding a bunch of one-off projects for ribbon cuttings will be just more of the same pork barrel politics. Remember the bridge to nowhere?
The price tag for all this is well beyond $200 billion or even $1 trillion for just transport projects, taking into account the necessary maintenance and repairs on existing systems. I haven't mentioned revamping and rebuilding inadequate and rapidly ageing sewage treatment systems, the cyber-attack vulnerable electric grid, crumbling dams, or out-of-date air-traffic control system (the President's solution is to privatize). I can go on and on. Just add onto the bill.
If we want to put America first and keep the country great—we need to start planning smart and funding projects that fit into long-term regional plans. That's also how we will create jobs. But there is no way to avoid the very large cost.
In the meantime, it appears we are still headed down the very dead end of getting little for less.
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