Trump's 'Money-Free Infrastructure' Plan

At the time, it was one of the few issues Democrats said they could work with Trump on, as they’d been calling for greater infrastructure spending for years. But nearly a year later, delivering his first official State of the Union Tuesday night, Trump’s repeated—and increased, even—his call for massive spending on an infrastructure bill. And it left Republicans tepidly applauding and Democrats cautiously suspicious.

Trump said he was asking both parties to come together to give America “the safe, fast, reliable, and modern infrastructure our economy needs and our people deserve,” increasing the hypothetical price tag of the bill from $1 trillion to $1.5 trillion.

Republicans were tepid because on top of all that money, they have learned that Trump isn’t entirely supportive of the public-private partnerships they would prefer in an infrastructure spending package. At a time when unemployment is at historic lows and the economy is already growing, Trump has suggested he wants a Big Government bill with direct investments, the sort of measure that a Democrat might write.

But Democrats weren’t exactly jumping out of their seats to endorse Trump’s plan either, partly because there really isn’t a “plan” at this point, and partly because they’ve had Trump’s promises yanked out from under them before. The president could agree to a principle one night and then tweet out a completely contradictory statement the next morning—or just have the White House chief of staff call Senate Minority Leader Chuck Schumer and tell him the framework is too liberal.

“The president says $1.5 trillion for infrastructure, and said nothing about how he was going to pay for it,” House Minority Whip Steny Hoyer summarized.

Many of Hoyer’s colleagues echoed the complaint; Lawmakers from both parties want to know where the money would come from. Various funding mechanisms under consideration are not final, and they could prove controversial enough to derail the bill before it could pick up any momentum on Capitol Hill in the first place.

Further obfuscating the issue, the White House’s $1.5 trillion number keeps fluctuating, depending on which staffer you ask. What is clear at this point is that the plan as drafted would rely heavily on state and local governments to bear most of the costs of the bill. Federal dollars would only cover $200 billion of the $1.5 trillion.

“It’s money-free infrastructure,” one Democratic lawmaker candidly remarked on his way to listen to Trump’s address. “It’s potholes-fix-themselves infrastructure.”

That’s a non-starter for many Democrats—even those who are comparatively sympathetic to the administration. When asked whether $200 billion represents enough federal funding to support such an effort, West Virginia Democrat Joe Manchin was skeptical.

“That’s a lot of leveraging . . . That means you have to bond an awful lot out,” he answered. “But the states are going to have to step to the plate, too.”

Maine Sen. Angus King said he was worried that low-density states like his would not be able to handle the burden of increased tolling that may occur under public-private partnerships advocated by the White House. Traditionally, said King, the federal government covers the bulk of expenditures for states, and if state governments would have to provide 80 percent under Trump’s plan, “that’s putting a real burden on the states that I’m not sure many of them are going to be able to meet.”

Louisiana Republican John Kennedy agreed with his Democratic colleagues in wanting to see more details on how to pay for the proposal. He has argued for months in favor of using the revenue from a one-time tax repatriation included in the now-passed Republican tax bill to pay for some of Trump’s infrastructure plan. Treasury Secretary Steven Mnuchin has been unconvinced by the idea since Kennedy first started pitching it, but on Tuesday Kennedy said Mnuchin seemed more open to the notion than he usually was during a banking committee hearing that morning.

But on the other side of the aisle, Democrats argue the tax bill actively undermined infrastructure efforts.

“The money has been spent,” House Democratic Caucus Chairman Joe Crowley said of infrastructure costs Tuesday night, pointing to tax revenue losses from the GOP tax bill that could have been spent on the new roads and bridges Trump wants to build.

The tax bill was projected by the nonpartisan Congressional Budget Office to add $1.5 trillion to the deficit over ten years, not accounting for economic growth that may be generated by the cuts. Yet even with economic growth factored into the equation, analysts at the nonpartisan Joint Committee on Taxation estimated the tax cuts would increase the federal deficit by about $1 trillion.

“Where is the money going to come from for this infrastructure investment? States can’t afford it. Local governments can’t afford it. The federal government has squandered that opportunity,” said Crowley.

And $200 billion from the feds isn’t a good starting point for him, either: “That’s very little money. Very little money.”

Even Republicans who swear in public that they have an interest in following through on Trump’s infrastructure ambitions are skeptical of pursuing such a bill—let alone during an election year, when calendar time and political bandwidth are more limited than usual.

“Why are we spending time doing the same thing we slammed Obama for? It’s a Republican stimulus plan branded as infrastructure,” a senior House Republican aide told TWS Tuesday night. “We are going to have trillion-dollar deficits in the next fiscal year and Republicans are to blame.”

Pay-fors are the biggest point of concern for the party. Republicans who attended the influential Koch network’s gathering in Palm Springs, California over the weekend, including Senate Majority Whip John Cornyn and North Carolinian Thom Tillis, reiterated their opposition to raising the fuel tax as a method of covering incurred costs — a notion Trump suggested he might consider last year.

Still, North Carolina Republican Mark Meadows predicted at the same Koch network event that Trump would garner “real support” for his infrastructure proposal, “and probably bipartisan.”

Despite having no shortage of unanswered questions and ongoing political feuds over government funding and DACA, lawmakers from both parties insisted they were willing to pass an infrastructure bill this year. That may prove easier said than done.

“There’s a bipartisan eagerness to get it. That’s a basic function of government, is dealing with infrastructure,” Oklahoma Republican James Lankford told TWS.

When TWS pointed out that Congress, which very recently had to reset its “Days Without Government Shutdown” count, seems to struggle with performing basic functions of government recently, Lankford admitted the current polarization of the body could make passing an ambitious infrastructure bill more arduous.

“We seem to fight over silly things,” he said.