Trump’s Trillion-Dollar Infrastructure Plan

On the campaign trail, Donald Trump promised to spend twice as much on infrastructure as whatever Hillary Clinton was proposing, which at the time was $275 billion. Doubling down again in a speech after winning the election, Trump now proposes to spend a trillion dollars on infrastructure over the next ten years.

President Obama had proposed to fix infrastructure with an infrastructure bank, though just where the bank would get its money was never clear (actually, it was perfectly clear: the taxpayers). Trump’s alternative plan is for the private sector, not taxpayers, to spend the money, and to encourage them he proposes to offer tax credits for infrastructure projects. He says this would be “revenue neutral” because the taxes paid by people working on the infrastructure would offset the tax breaks. In short, Trump is proposing tax credits in lieu of an infrastructure bank as a form of economic stimulus.

America’s infrastructure needs are not nearly as serious as Trump thinks. Throwing a trillion dollars at infrastructure, no matter how it is funded, guarantees that a lot will be spent on unnecessary things. As Harvard economist Edward Glaeser recently pointed out in an article that should be required reading for Trump’s transition team, just calling something “infrastructure” doesn’t mean it is worth doing or that it will stimulate economic growth.

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The Who-Gets-to-Decide Crisis

“There is now a consensus that the United States should substantially raise its level of infrastructure investment,” writes former treasury secretary Lawrence Summers in the Washington Post. Correction: There is now a consensus among two presidential candidates that the United States should increase infrastructure spending. That’s far from a broad consensus.

“America’s infrastructure crisis is really a maintenance crisis,” says the left-leaning CityLab. The “infrastructure crisis is about socialism,” says the conservative Heritage Foundation. “There is no widespread crisis of crumbling infrastructure,” says libertarian Cato Institute. “The infrastructure crisis . . . isn’t,” agrees the Reason Foundation.

As Charles Marohn, who classifies himself as a traditional conservative, says, the idea that there is an infrastructure crisis is promoted by an “infrastructure cult” led by the American Society of Civil Engineers. As John Oliver noted, relying on them to decide whether there is enough infrastructure spending is like asking a golden retriever if enough tennis balls are being thrown.

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Asking the Right Questions About Infrastructure

“The American economy is a growth Ponzi scheme where we try to . . . generate a short-term illusion of wealth by having our cities, neighborhoods and families take on enormous long term liabilities,” says Strong Towns founder Charles Marohn in an interesting article about the so-called infrastructure crisis. What he calls the “Infrastructure Cult” leads the nation to go deeply into debt building more and more infrastructure without ever asking “why do these investments not generate enough productivity — enough real return — to be sustained?”

Marohn and the Antiplanner have had our differences in the past. Marohn thinks the suburbs are dead. He thinks most urban arterials, which he derisively calls “stroads,” should be designed downwards in ways that will vastly reduce mobility.

When addressing an issue such as infrastructure, it is important to ask the right questions. So far as I’ve quoted above, Marohn has done so. However, I fear he will miss one important question, which is: How should we measure whether particular infrastructure investments generate enough productivity to be worthwhile?

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Spend More or Less on Infrastructure?

USA Today thinks the federal government needs to spend more on infrastructure. An opposing view suggests that most of any spending increases would go for unnecessary new projects, not for repair of existing infrastructure.

Certainly, something Most often, the doctors cialis tadalafil 100mg use a combination of drugs that contain nitrates and Kamagra can lead to drop in blood pressure temporarily, and causes dizziness and fainting. The fear of erectile http://deeprootsmag.org/2012/10/12/you-feel-them/ purchase generic levitra dysfunction. Back pain cheap viagra prices http://deeprootsmag.org/2014/04/14/nevadan-1950/ is not a simple health issue and this is the same with other physical discomforts such as headache, neck pain and injuries. Acidic changes in the bile cause precipitation of the very aggressive, bile acids and make bile corrode and irritate the gallbladder, bile ducts, viagra tablets 100mg and the sphincter of Oddi have pendulum effect. must be done about the impasse over the federal transportation bill. But increased spending isn’t necessarily the solution; we first need to make sure that the money that is being spent is going to the right places.

John Oliver on Infrastructure

Given that American attentions spans have grown so short that the only way we can learn anything is through comedy, John Oliver’s report on infrastructure is a welcome addition to the debate. He gets some things wrong, but many things right. The Antiplanner was flying to Washington DC when the report was first broadcast, so this commentary is a little late. But if you haven’t seen it, you can watch it below.

Oliver notes that the American Society of Civil Engineers gives a “D-plus” grade to the state of our infrastructure. But he points out that asking civil engineers to grade infrastructure spending is “like having the state of our nation’s tennis balls assessed by the American Society of Golden Retrievers.” Too bad he doesn’t remember this rule later in the broadcast when he notes that both the AFL-CIO and the U.S. Chamber of Commerce want to increase federal spending on infrastructure, suggesting that if these traditional antagonists agree on something, it must be right. Of course, what they agree on is that Americans should pay more taxes so their members can get more money from the feds.

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Obama’s Stealth Transportation Bill

In order to highlight the need for a new transportation bill, President Obama is visiting the Tappan Zee Bridge today (which, ironically, is likely to increase delays to commuter). Tappan Zee is one of about 10,000 bridges that–like the Skagit River bridge that collapsed almost a year ago–is considered “fracture critical,” meaning the destruction of one key part could lead the entire bridge to fall down. However, the state of New York is currently building a replacement bridge that will not have this fault.


The destruction of just one part of this bridge could cause the entire center span to collapse. On the other hand, the bridge has lasted 59 years, and probably could last quite a few more without anything destroying one of the fracture-critical parts. The bridge may be in poor condition for a number of reasons, but being fracture-critical is not one of them. Flickr photo by waywuwei.

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Still No Infrastructure Crisis

Another year, another spate of stories about how America’s infrastructure is crumbling and how we need to raise taxes to repair it. Here’s the reality: Infrastructure that is funded out of user fees is in good shape; infrastructure that is funded out of taxes is not. Those who benefit from tax-supported infrastructure want the people who use user-fee supported infrastructure to pay more taxes so the former can continue to enjoy their obsolete systems at little cost to themselves.

Oregon Representative Earl Blumenauer wants to increase gas taxes by 15 cents a gallon–nearly double what they are now–to fund transportation infrastructure. But America’s highways, which support the users who pay those gas taxes, are in good shape. The number of structurally deficient bridges is rapidly declining and the average smoothness of pavement is improving.

It’s not hard to see that doubling gas taxes also doubles the money going into rail transit and other slush funds. The Federal Transit Administration said in 2010 that transit agencies suffer from a $78 billion maintenance backlog, and the total has likely increased since then since the agencies were spending less than necessary to keep systems in their current state of poor repair.

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What Infrastructure Deficit?

An economist named Ed Dolan who lives in Washington state opines that the collapse of the Skagit River Bridge reveals an “infrastructure deficit.” That’s certainly the prevailing wisdom. But consider this.

The bridge collapsed because one of its supporting beams 14.5 feet above the pavement was hit by an oversized truck that should not have been on the bridge. If that oversized truck had hit that beam in 1955, the year the bridge was built, it would have collapsed then. Instead, the bridge stood for 58 years before being hit by such a truck.

Show me any bridge and I can conceive of a truck big enough to bring it down. That doesn’t prove we have an infrastructure deficit; it only proves that every bridge has a limit to what it can carry. Height and weight limits are posted for most bridges; the driver of the truck crossing the Skagit River last week apparently neglected to read the signs.

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CBO: User Fees for Infrastructure

The Antiplanner has long argued that transportation and other infrastructure should be paid for out of user fees, because user fees are the best indication that such projects will be truly productive. A report this month from the Congressional Budget Office reaches a similar conclusion.

The report observes that “carefully selected infrastructure projects can contribute to long-term economic growth,” but that “the potential gains from public spending for transportation and water infrastructure depends crucially on identifying economically justifiable projects.” In order to identify such projects, “the demand for infrastructure could be better aligned with the existing supply by putting a price on those services that reflects the full cost of using infrastructure.” This price should include “both the cost of providing infrastructure services and the costs that one person’s use imposes on others”–in other words, congestion pricing.

The report adds that the federal contribution to infrastructure projects should depend on “where the benefits are expected to accrue.” Projects that primarily provide local benefits should primarily be funded by the locals, while projects that provide more national benefits could get more federal funding. Federal funding of primarily local projects would “result in too many projects, or projects that are too expensive, being undertaken.” Continue reading