If you’re paying attention to the conversations going on in D.C. this week you’ve probably already heard rumors about a massive infrastructure bill which is gaining some support. This is a very worrying sign before we’ve even seated the new Congress and it reminds me of the cautions that Allahpundit issued when he talked about Nikki Haley recently. You may recall that she was cautioning the new GOP majorities to remember that we’re supposed to be the party of small government and balanced budgets. Right guys? Um… guys?
There’s no reason to hit the panic button yet, but some of this portends possible trouble on the horizon. (The Hill)
Republicans in Congress appear ready to embrace President-elect Donald Trump’s $1 trillion infrastructure proposal — at least for now.
But even the most optimistic lawmakers caution that conservative support for his plan will hinge on the details, such as how the package is paid for and whether it’s coupled with other GOP priorities.
“There’s an interest among our members, frankly, on both sides, in doing something on infrastructure,” Sen. John Thune (R-S.D.), chairman of the Commerce, Science and Transportation Committee, told reporters.
Yes, I’m sure there’s some interest in “doing something on infrastructure” as Thune said, but there’s an obvious bear trap waiting for us here which I’m praying the GOP is wise enough to avoid. It starts with some of the possible suggestions (vague though they may be) which are being floated in the article. Having read them, there are some smoke signals coming out of these conversations which we might want to get out of the way right up front.
$550 billion worth of infrastructure investment paid for by bonds – No.
A $1 trillion package financed by offering tax credits to private investors – Nope.
A massive spending bill which gets passed because it’s tied to something else like a tax reform package – Sorry, but that’s not going to work.
But don’t take that to mean that we can’t do it at all. These are just a few things already being tossed around which we should tamp down before anyone takes them seriously.
Right out of the gate, let’s stress that this isn’t something that needs to happen overnight. In fact, trying to force the issue immediately would be the worst choice possible. The unemployment rate is down considerably, even though many of the “new jobs” are mediocre at best and wages remain depressingly low. Things may not be great, but they’re at least stable. An infrastructure bill will be fraught with peril and there’s good reason to slow roll this because it will take time for Trump and the Republicans in Congress to get used to their new sleeping arrangements. Here’s how that might work:
If this blows up in the first few weeks it could set the stage for internecine warfare in the GOP before we’ve even got our boots laced up for the coming four years. There are many things that the Republican majorities and the new president will be able to agree on and get done in relatively short order without setting fire to our own barn. Filling up appointments (including the Supreme Court seat) should be a no brainer. Setting a committee to work identifying what we’re going to replace Obamacare with could start immediately. Tax reform of some significant (if not ideal) form would be yet another achievable win early on. The point is, if you give conservatives some early, measurable victories to take home with them it will be much easier to enter into some infrastructure negotiations with a degree of trust built up on both sides. Take the low hanging fruit first before we begin asking either side to hold the ladder for the heavier lifts.
Once we get all of those items (and others) knocked out, let’s have the White House sit down with the GOP leadership and see what might be done on this front. A couple of things to think about in terms of any future infrastructure bill:
First of all, unlike the disastrous stimulus bill passed by the Democrats, any money allocated to the states should only be spent on designated, job producing, productive work, and that provision should be iron clad. We saw too many stories, such as the one in New York, where the states took the money and, rather than injecting it into the economy, they simply plugged holes in their state budgets with nothing new making its way down to those needing jobs. The money disappeared and nothing was “stimulated.” One idea is to have the states propose the infrastructure projects, pass them, fund them with bond measures initially and then as the work progressed a significant portion could be paid off with federal funds.
Any such measure should be limited in scope with specific guidelines established by Congress if this funding is authorized. Under the Obama administration we’ve seen the word “infrastructure” applied to everything from windmills to healthcare. We should be talking about roads, water supplies, sewage systems and power lines or pipelines. (And power lines are complicated because they are owned by the utilities, but some sort of partnership deal might be possible because we need to strengthen and smarten the grid. Pipelines really just need approval, not funding, and the oil companies will build them.) There’s probably a few more but you get the idea.
And finally, they’ve got to figure out a way to pay for at least most of this rather than tacking another trillion dollars on the debt in Trump’s first year. Yes, we may not be able to pay for every last dime of it, but if this sort of massive bill is the goal, then something has to give somewhere to make up for it. If you can manage to pull all of that together then you’ll probably be able to garner some broad conservative support for the plan.