Infrastructure spending a raw deal
There’s no doubt America’s infrastructure is in sorry shape and in need of massive investment. Just look at Michigan’s pock-marked roads and rusting bridges as an example.
But the deal sketched out by Democratic congressional leaders and President Donald Trump this week is not the answer.
In fact, the $2 trillion bargain may make things worse.
First, while they easily reached consensus on spending, how to raise an amount equal to roughly half the annual federal budget and what exactly to spend it on was left murky.
A 20-cent-per-gallon hike in the federal fuel tax, which would more than double the 18-cent levy, was put on the table. In theory, a user tax is the best way to fund road work, and it’s how the national Highway Trust Fund is financed now.
But Democrats want more, and they want to get it by checking off a key agenda item on their partisan bucket list: rolling back the Republican tax breaks most American’s received last year.
Even if Trump were foolish enough to erode one of his administration’s signature accomplishments, and one that is delivering on its promised economic growth and job creation, such a concession would have to be pried from the cold, dead fingers of Senate Majority Leader Mitch McConnell.
The other obstacle to a viable infrastructure spending deal is how Democrats define “infrastructure.” Senate Minority Leader Chuck Schumer and House Speaker Nancy Pelosi want money to expand broadband as well and to spend on their global warming obsession. Smoothing roads, we fear, would fall well down the priority list, giving way to items more fashionable with Democratic interest groups.
The most scary scenario is that the White House and congressional Democrats will agree on a spending plan, but not a funding mechanism, meaning that another $2 trillion will be added to an already unthinkable $22 trillion national debt.
If a pact is reached on raising the fuel tax, it will sink efforts by states such as Michigan to raise revenue to finance their own road work.
Gov. Gretchen Whitmer is asking for a 45-cents-per-gallon hike in the state fuel tax for roads, an amount she’s not likely to get, but the Legislature might be amenable to a smaller increase. That is unless it senses Congress is going to hit state motorists with a steep federal fuel tax hike.
With the federal government raising and spending the new infrastructure dollars instead of the states, Michigan can expect smaller benefit from the infrastructure boost than if it were managing the projects itself.
— The Detroit News