President Trump’s massive infrastructure package could be bigger than expected and be released as early as next month, according to the administration....But is there going to be a lot of new, stimulative spending? Doesn't look that way:
“We’re talking about a very major infrastructure bill for $1 trillion, perhaps even more,” Trump said during a town hall-style event with American business CEOs....
Transportation Secretary Elaine Chao indicated Tuesday that the proposal could be unveiled as soon as next month.
“We’re working on a legislative package that will probably be in May, or late May,” Chao said during the town hall event.
The package may ... give projects a 90-day deadline to get started in order to receive funding....How is that even possible, given the years-long approval process for most projects? It sounds as if what Ron Klain said about a plan then floating around Trump World was right:
"We're going to be very strong that it has to be spent on shovels, not on other programs," Trump said. “If you don’t start, if you have a job that you can’t start within 90 days, we’re not going to give you the money for it.”
The Trump plan doesn’t directly fund new roads, bridges, water systems or airports, as did Hillary Clinton’s 2016 infrastructure proposal. Instead, Trump’s plan provides tax breaks to private-sector investors who back profitable construction projects. These projects (such as electrical grid modernization or energy pipeline expansion) might already be planned or even underway. There’s no requirement that the tax breaks be used for incremental or otherwise expanded construction efforts; they could all go just to fatten the pockets of investors in previously planned projects.Now, it's also possible that Trump is claiming he can shrink the approval process from years or even decades to three months or less, from initial proposal to groundbreaking; that's the sort of thing Trump has in the past referred to as "truthful hyperbole" and others have referred to as "bullshit."
But it's more likely that he wants to favor programs that will win him positive headlines very quickly, at a time when his poll numbers are plummeting. The best way to do that if for Trump to take credit for projects that are already on the brink of approval. We know he likes to take credit for positive developments for which he has no responsibility -- how many times has he claimed to be responsible for saved jobs or corporate expansions that had already been decided on?
And some of the money will apparently be spent this way:
National Economic Council director Gary Cohn told executives that privatizing air traffic control, which the administration proposed in its budget outline in March, "is probably the single most exciting thing we can do.".Maybe I'm a little slow, but 'm struggling to grasp how that's going to create jobs or upgrade infrastructure. But it sounds as if the administration might fund it while calling it infrastructure spending.
Cohn, an investment banker with Goldman Sachs before he became Trump's top economic adviser, said it could help speed flight times and reduce fuel use.
Cohn said if cities "sell off" or privatize infrastructure assets, the administration could provide financial support.
"We're not on the cutting edge of this," Cohn said. "We've got to get a little more comfortable with public-private partnerships."
Maybe the infrastructure bill won't be entirely ersatz. But don't get your hopes up.