The Problem With Trump’s $1.5-Trillion Infrastructure Plan Due Out Today Is Not The Money
Plan Would “Only” Cost The Federal Government $200-Billion
Here’s how Trump’s plan would theoretically work:
- The federal government would set aside that $200-billion dollars. Where would it come from? Nobody knows. So far it’s a nebulous “cuts from existing programs”. More likely it’d be from a gas tax.
- A lot of it would be used for grants to state and local governments to cover up to 20% of the cost of an infrastructure project. Those state and local governments would then have to find the money to cover the remaining 80% of the cost of building or re-building roads, bridges, airports, etc.
- In order to do that, the White House envisions them entering into partnerships with private companies. And that’s where that $1.5-trillion number comes in: it’s the amount the Trump Administration estimates will be spent in total between the federal government, state and local governments, and private companies when all is said and done.
- In order to entice those private companies to participate, Trump proposes cutting back on studies and permits now required for major construction projects, so those companies will know they won’t be waiting around for years to see a return on their investment.
- Consumers will start seeing an ugly downside to the convenience of electronic toll collection: the ability to charge anyone any amount at any time anywhere. The cost of a plane ticket might go up so private companies could collect fees from using “their” airports, for instance.
- Finally, about $50-billion would go directly to projects in rural areas because, well, Red states right now have leverage.
This might not sound all that bad. And it’s the kind of thing that might get widespread support under normal circumstances. Democrats like funding public projects (although they’d probably prefer some kind of new tax to fund public works rather than these public-private partnerships). While Republicans who say they want smaller government might also get behind it.
But it’s bad. In our opinion. And not just because it already adds to a crazy huge deficit. Here’s why:
- This is the way things get built in third world countries and leads to a fragmented hodgepodge of willy-nilly projects with no central framework. What’ll get built and repaired first will be what private companies think they can make the most money from, not what needs to get built and repaired first.
- And private companies will almost certainly have the upper hand, because Trump and Republicans just made it a lot harder for state and local governments to raise money on their own by ending the deductibility of state and local taxes.
- Most importantly: it will go a long way toward abdicating federal responsibility for building and maintaining things like the Interstate Highway System, which would never exist in the first place if it’d had been left up to private companies and local governments to decide when and where to build. Right now, the federal government contributes up to 80% of the cost of maintaining that system. Bringing it down to 20% could signal a huge transformation for one of this country’s greatest achievements.
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Infrastructure Plan Part Of Larger White House Budget Proposal
You have 3 choices:
- Get really angry over the next couple of days over the things Trump will propose to cut.
- Ignore it. Since none of the stuff you got angry about at this time last year (except perhaps a huge increase in military spending) ended up getting implemented in the budget bill that just passed last week (much to Trump’s dismay). The only danger would be if Republicans somehow win a filibuster proof majority in the Senate this fall.
- Half do both.
One interesting thing the Washington Post points out, is the latest Trump budget proposal no longer even bothers to promise eliminating the budget deficit or even a path to eliminating it. This used to be a huge priority for Republicans.
And the Post also has a very interesting analysis of something we’ve talked about a lot: Trump and Congress’ grand experiment of embarking upon a huge economic stimulus program when the country is not in need to an economic boost. It argues at the current level of employment, the U.S. should be pretty close to breaking even, but because of massive tax cuts, etc., it’s running deficits similar to those you’d expect to see during a Recession. Here’s one of several compelling graphics in the piece:
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Senate Takes Up DACA Today
To get the ball rolling, a group of Republican Senators is set to introduce a decidedly non-bipartisan DACA bill, in contrast to the several bipartisan proposals already out there, all of which Trump has said won’t fly. This “Republican only” bill is essentially Trump’s own list of immigration demands, which of course were at least partly crafted by some of the Senators behind it such as Arkansas’ Tom Cotton.
The bill does seem to address one important question we’ve had: how can Trump maintain an economic boom in this country, when at the same time deporting millions of workers, threatening a labor shortage?
Turns out under this hard-line bill, according to CNN, the President’s ban on what he calls “chain migration” won’t go into effect until the backlog of relatives who have already applied is cleared. That’s several million people. Meaning this isn’t really the urgent security issue Trump makes it out to be.
A Lingering Question That Could Soon Loom Large: Who’s #3 At Justice Now That Rachel Brand Is Going?
Republicans spent the weekend frantically trying to spin Brand’s departure from the Justice Department as her taking “the job of a lifetime”; “an offer she couldn’t refuse”. She will be General Counsel for Walmart. But it’s kinda hard to believe that had she stayed, the same or similar opportunity wouldn’t have been available to her a year, 2 years, 4 years, 6 years from now…
Somebody that close to the top leaving usually means one of 2 things:
- They don’t see any possibility of their boss getting fired or leaving, so they don’t see any chance of moving up.
- They think their boss could soon be getting fired or leaving, and they don’t want that job.
Now ask yourself which is more likely: especially with all the heat Trump’s putting on Assistant Attorney General Rod Rosenstein?
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Pence Returns From Korea Where He Was Totally Overshadowed By Kim Jong-un’s Sister
Pence was seated next to Kim Yo-jong during the Opening Ceremony of the Winter Olympics in Pyongchang, South Korea.
Pence, who seems to have taken on the roll of ‘Trump’s official protestor’, refused to stand when the joint North-South Korea team entered the stadium, much as he walked out of an NFL game when some players refused to stand for the national anthem.
Pence’s gesture was not received well locally or internationally, except perhaps by one person in the Oval Office.
And while Pence carried with him a message of “maximum sanctions”, Kim’s sister invited South Korea’s President to visit North Korea.
Pence also boycotted a dinner hosted by South Korea’s President Moon, because a North Korea delegation was attending.
On his way home, Pence told the Washington Post that the Trump Administration is willing to hold talks with North Korea. A statement others in the Trump Administration have made previously, only to be shot down by the President shortly after.
Fight Conspiracy Theory With Conspiracy Theory
When we first read the story about Democratic Senator Ron Wyden trying to get documents related to Trump’s sale (at a great price!) of some property in Florida to a Russian billionaire several years ago, we thought it was stupid and petty. It’s not a new story. It’s widely known, especially in Florida, and part of Trump’s legend of uncanny luck in getting bailed out of bad situations by unlikely sources.
Then we realized that it’s exactly what we’ve been saying Democrats should be doing. All the documents in the world won’t prove anything in this case about what motive might’ve been behind the purchase. Currying favor? Buying influence? Just plain old money laundering? A foreigner getting taken for a ride over a piece of Florida real estate?
Doesn’t matter. Goon on ya, Ron Wyden. Keep it up.
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What Did You Do This Weekend? Here’s What Trump Did
- Defended a wife-beater, seemingly on the basis that he did a good job and he looked good. And yes, Mr. President, if you physically abuse someone you do deserve to have your career ruined.
- Refused to release a memo by Democrats rebutting “the memo” by Republican Devin Nunes which Trump says “totally vindicates ‘Trump’” in the Russia probe. Trump says the Democrats’ version contains too many classified secrets. Funny, but the F.B.I. and Justice Department said exactly that about the Republican document Trump had no trouble releasing intact.
- Quoted at length (a double-double Tweet) a notorious conspiracy theorist who hides behind the legitimate sounding name “Judicial Watch”, and who produced Steve Bannon’s film “District of Corruption”. He calls Trump “victimized” by Obama.
- Lamented the fact that in order to get his increase in military spending through, he had to give Democrats funding for “things we do not like or want”. This would include: community health centers, environmental protection, and medical research by the National Institutes of Health.
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(This story originally appeared in “The Chaos Report” Newsletter. Subscribe for free at https://thechaosreport.com/subscribe/?scr=Medium)
