PortandTerminal.com, May 1, 2019
American Democratic congressional leaders announced yesterday after a meeting with President Trump that an agreement had been reached on the price tag for a potential infrastructure plan: $2 trillion. How to pay for it remains unclear.
House Speaker Nancy Pelosi (D-CA) and Senate Minority Leader Chuck Schumer (D-NY) announced that they have reached the tentative agreement with President Trump for a $2 trillion infrastructure plan, which would fund improvements to America’s waterways, roads, bridges and broadband internet links. According to Schumer, the three leaders agreed in principle on the number, but many points will still have to be discussed, particularly the source of funds.
“It was a very constructive meeting,” Schumer told reporters outside the White House. “We agreed on a number, which was very, very, good, $2 trillion for infrastructure. Originally, we had started a little lower and even the President was eager to push it up to $2 trillion. That is a very good thing.”
In a letter to the president, Pelosi and Schumer suggested that he should start that portion of the negotiations. “We look forward to hearing your ideas on how to pay for this package to ensure that it is big and bold enough to meet our country’s needs,” they wrote.
Where to find the money?
Traditionally, much of the nation’s highway funding has come from federal gas taxes, but the tax has not been raised since 1993 and modern vehicles are consuming less gas per mile. Sen. Peter DeFazio, chairman of the House Transportation and Infrastructure committee, favors raising the tax and securitizing it to raise $500 billion in bond funding. “We can provide an immediate boost in investment by issuing bonds tied to the future [tax] revenues. The bond revenues are available immediately and fully offset,” he said at a hearing in March.
Senate Democrats have also called for closing tax loopholes used by corporations and the wealthy in order to raise funds for infrastructure improvements. Schumer is said to favor rolling back the recent Republican-led tax cut to raise funds – a proposal that would likely meet opposition from the White House.
Other funding proposals in the past have included building infrastructure through “public-private partnerships” — leveraging a modest amount of government spending to stimulate private investment in projects around the country.
Quid pro quo
Any deal would also have to clear obstacles from unrelated political disputes. In particular, it could be contingent upon the multiple House oversight inquiries stemming from the Mueller investigation.
“It’s not reasonable to expect the president to work with you on Monday on a big infrastructure bill and have you punching him in the face on Tuesday on 15 investigations,” said White House chief of staff Mick Mulvaney at an event Tuesday. “I hope conversations go well today but if they don’t, it would not surprise me.”
Copyright © 2019 PortandTerminal.com. All rights reserved. This material may not be published, broadcast, written or redistributed.