Donald Trump has been promising a big infrastructure plan since the campaign days. But what he’s got is a whole bunch of nothing. The president dropped his plan on Monday and it’s low on the funding and high on the private giveaways. Hunter Blair at the Economic Policy Institute has been following the twists and turns of Trump on infrastructure and the problems with so-called public-private partnerships for a while, and he joined me to break down Trump’s infrastructure plan.
I think the structure of the plan is what we expected to see. It is only $200 billion in federal funding, as opposed to the headline claims of either $1.5 trillion or $1 trillion that the administration had been claiming. Of that, $100 billion goes to this sort of grant program that kicks the funding decisions to states and localities. They are required to come up with 80% of the funding and the federal government only provides 20%. There is $50 billion for rural projects. All of it comes back to what appears to be their belief that state and local governments need to spend even more on funding our infrastructure. Then, there are quite a lot of boilerplate claims about leveraging the private sector.
…At the end of the day, private entities don’t bring any more funding to the table. Either the federal government is going to fund it or you are going to be looking at taxes or tolls or user fees. Private companies do not build our infrastructure for free and they don’t manage or maintain anything of the sort for free and they expect to earn a return. They will earn that return through partnerships that allow them to collect tolls or pay them through state and local taxes. Leveraging the private sector, it gets thrown around a lot, but it certainly doesn’t bring any new money to the table.
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