Trump's infrastructure promises, explained
President-elect Trump pledged to upgrade the nation's infrastructure, but the specifics are murky
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In these divisive times, voters and politicians seem to agree on at least one thing: Our nation's infrastructure is desperately in need of major upgrades, said Andy Uhler at Marketplace. "In fact, it was one of the first things President-elect Trump mentioned in his victory speech," echoing earlier pledges on the campaign trail to invest as much as $1 trillion rebuilding U.S. highways, airports, and schools. The specifics, however, are murky. Who foots the bill and what projects get priority "are just a few of the details the Trump team has to work out." Trump's promise to refurbish crumbling U.S. infrastructure is a big reason behind the stock market's post-election rally, said Paul Davidson at USA Today. His advisers have laid out a rough blueprint centered on public-private partnerships, which theoretically "would add nothing to the deficit." That program, says Team Trump, would generate up to $1 trillion worth of investment over 10 years, creating 3.3 million jobs.
"The catch, though, is that Trump doesn't really have a plan to do all this," said Brad Plumer at Vox. At least not a conventional one. Right now, the idea is to offer some $137 billion in tax breaks to private investors who want to finance toll roads and bridges or other revenue-generating projects. The problem is, if every project needs to make a profit for its investors, a lot of pressing infrastructure needs won't get funded. The monetized approach likely won't work for repairing existing roads or replacing aging pipes in poor communities like Flint, Michigan, "where people can't afford a big hike in their water bills." Those projects require billions of dollars in direct public funding, which is a non-starter with the Republican-controlled Congress. There is one way to get the private sector to pay for projects like Flint's water system: "Give them a cut of the profits in perpetuity," said David Dayen at New Republic. The result would probably be a disaster, however. Chicago did something similar in 2008, when it leased the rights to 36,000 parking meters for 75 years to a Wall Street investor group, which now charges exorbitant fees to park in the city.
Don't expect a blue-collar job boom, either, said Steve Chapman at the Chicago Tribune. The unemployment rate for construction workers is just 5.7 percent, and "out-of-work coal miners don't necessarily have the skills contractors need to expand airports or replace bridges." And while stimulus spending can be helpful in a recession, "in the eighth year of a recovery, it will just crowd out private spending, nullifying any macroeconomic benefit." Still, companies are already lining up to make sure that their pet projects qualify as essential infrastructure, said Steven Mufson at the Los Angeles Times. IBM CEO Ginni Rometty has pressed Trump on the need to invest in cybersecurity, while Verizon is pitching internet-connected LED streetlights. Meanwhile, energy companies are licking their chops at the prospect of new oil pipelines. "There is no shortage of volunteers," but what eventually gets the green light is anyone's guess. "One person's critical infrastructure is another person's bridge to nowhere."