Trump’s ‘smoke and mirrors’ infrastructure plan is a move toward privatization

Leaves states and cities holding the bag, cuts programs working families rely on

Washington – The Trump administration’s infrastructure plan, released recently alongside the administration’s fiscal 2019 budget proposal, amounts to nothing more than empty talk.

Trump campaigned on the need infrastructure reform, promising to spend “big” on infrastructure and consistently touted his record as a builder.

In unveiling the plan, Trump said: “We will build gleaming new roads, bridges, highways, railways, and waterways all across our land. And we will do it with American heart, and American hands, and American grit.” Adding that the plans constituted “the biggest and boldest infrastructure investment in American history.”

Last year, the ASCE gave the nation’s infrastructure a D+ grade and said failure to act would cost the U.S. economy $4 trillion by 2025.

The proposed $200 billion in federal funding called for in the administration’s $1 trillion plan is a fraction of the $2 trillion the American Society of Civil Engineers (ASCE) says is needed to repair the nation’s infrastructure.  And the plan radically cuts federal investments, leaving 80 percent of the overall cost for already cash-strapped states and municipalities to fund.

“President Trump has rightly noted the urgency and scale of America’s infrastructure crisis, and he has an opportunity to fix it,” said AFL-CIO President Richard Trumka. “Unfortunately, this proposal relies more on accounting gimmicks and Wall Street investors than on a new federal commitment.

“America’s working people spoke loud and clear at the 2017 AFL-CIO Convention in St. Louis by demanding a massive infrastructure plan for a better, brighter and more prosperous future. The right plan will create millions of good jobs, increase long-term growth, make America globally competitive, improve Americans’ quality of life and protect our health,” Trumka said.

“President Trump’s empty plan lacks the dollars needed to transform our aging and crumbling infrastructure into something capable of driving our economy forward for generations to come.

“If our nation’s leaders are serious about building America, they need to step up with trillions of dollars in new federal funding that supports America’s jobs, America’s resources and America’s workers,” Trumka said. “And they need to do so while upholding high labor standards, good wages and safe worksites.”

PRESIDENT’S PROPOSAL ONLY ADDS TO OUR GROWING PROBLEMS

Larry I. Willis, president of the Transportation Trades Department of the AFL-CIO, said, “The proposed budget includes a walk away approach to infrastructure that would rob other federal program and leave states and municipalities on the hook for the majority of the cost.

“While we appreciate the spotlight President Trump has shined on the need to rebuild America, too many aspects of this plan undermine the diverse needs of our transportation network and the businesses, communities, and working families that depend on it.

“Robbing other federal priorities — including important transportation programs — to pay for infrastructure will only add to our growing problems,” Willis said. “Devolving the federal government’s funding responsibility to cash-strapped states and municipalities will leave too many projects and jobs behind.”

A CRITICAL JUNCTURE

“There’s no doubt that infrastructure in our country is in a serious state of disrepair, and that we’re in desperate need of a massive investment from the federal government,” said John Samuelsen, international president of the Transport Workers Union of America. “Our members are on the front lines of our country’s infrastructure network every day, laying subway track, operating and repairing inner-city buses, servicing Amtrak passenger and freight rail cars, and keeping the airline industry moving around the clock.

“America is at a critical juncture. We must invest in our transportation infrastructure now, or risk the further degradation of our inter-connectivity. We can reverse the decades-old downward spiral and simultaneously create decent, family-sustaining jobs at the same time. That’s an achievable goal, and it’s what the American people want.  But it must be done correctly.

“While we applaud the White House for recognizing the need for a plan, our vital transportation needs will simply not be rebuilt by thrusting the responsibility onto cash-strapped states, or cutting funding for existing transportation programs to pay the federal government’s share,” Samuelsen said. “Robbing Peter to pay Paul is not the solution to our problems.

“The United States government must get serious about infrastructure fixes before our physical structures fall into a permanent state of disrepair. And an infrastructure investment plan that is a type of shell game is not a serious proposal.”

PROPOSING THE SAME UNDERINVESTMENT

Hunter Blair, budget analyst for the Economic Policy Institute, says state and local governments already account for 77 percent of public infrastructure spending in the United States –– 62 percent of capital investment and 88 percent of operations and maintenance.

“It is odd to argue that the United States needs a substantial infrastructure push to deal with past underinvestment, and then to propose that the same system that yielded this underinvestment — relying too much on state and local governments — should just be continued,” Blair said. “If we want a real investment in infrastructure, continuing to kick the problem to state and local governments won’t solve anything.”

A PUSH TOWARD PRIVATIZATION

The Trump administration claims its plans are different because they leverage the private sector (read “privatization of infrastructure”), but that’s just smoke and mirrors, Blair says.

“Private entities will not build infrastructure for free,” he said. “[They] but will expect a return on investment. That means state and local governments will have to pay for the infrastructure with taxes, tolls, or other user fees.”

And public-private partnerships come with their own set of problems, including threatening existing labor contracts and creating a monopoly that places the private partner in a position to hike tolls and degrade service quality.

CUTS PROGRAMS WORKING FAMILIES RELY ON

The federal gasoline tax, which funds the Highway Trust Fund, hasn’t been increased since 1993, This year’s budget doesn’t raise the gas tax or identify any other funding source. The current trust fund gap is $138 billion, which means almost 70 percent of the meager federal commitment called for in the stand-alone infrastructure proposal would go just fill the existing hole in future investments, leaving the infrastructure plan to be paid for with unspecified budget cuts in the 2019 budget.

The vast majority of public investment in the nation’s infrastructure is funded by nondefense discretionary (NDD) spending.

This year’s budget follows last year’s in gutting NDD spending and thus, public investment. Last year, The President’s budget called for NDD budget authority to reach an unprecedented low of 1.4 percent of GDP by 2027. The new budget follows the path and would cut NDD spending to 1.3 percent of GDP by 2028.

The administration’s fiscal year 2019 budget also offers up gutting of social programs.

The budget would cut the Supplemental Nutrition Assistance Program (SNAP) by $213 billion and would also make large cuts to Medicaid and Medicare, similar to the House and Senate budget resolutions from last year, which called for cuts of around $500 billion to Medicare and $1.5 trillion to Medicaid.

“The Trump administration’s infrastructure plan remains nothing but smoke and mirrors… paid for by cuts to programs that working families rely on,” Blair said.