With the inauguration of President Trump came the 100 day countdown. Largely considered the most important time in a president's term, these first 100 days in office will set the tone for the rest of his time in the White House.
While President Trump spoke a big game on the campaign trail, it was hard to nail down any exact policy plans. The same can be said for his comments regarding rebuilding infrastructure. President Trump promised to rebuild our roads, fix our bridges, and make American infrastructure great again. Yet, he was noticeably vague when asked about how he was going to go about doing this.
In a plan just released, President Trump helped clarify. Rather than spend public money, he plans to incentivize private companies to rebuild our infrastructure in an amount he hopes will reach a trillion dollars after a decade. The problem with this, however, is that there needs to be a real and tangible incentive for these private companies. There is a reason roads, highways, etc have taken on the role of a public good; because absent tolls, there is no way to make money from building a road.
Thus, it seems that President Trump is simply shifting the economic impact around, rather than eliminating it. Sure, we may not be asked to pay more in taxes so that we can rebuild infrastructure. But if it is left to the private sector, we will most likely see an increase in the amount of tolls and costs associated with using roads, public transportation, and the like.
This will be an interesting term for many reasons, but it will be especially interesting to see what role the private sector will play throughout President Trump's presidency, and if it will actually save tax payer dollars.
http://www.economist.com/blogs/gulliver/2017/01/pay-you-go
4 comments:
It has been interesting to listen to Trump talk about how he plans on funding these projects like this one, and others like 'the wall'. In the case of the wall, the money it will most likely come from taxes on imported Mexican goods, something that the consumer pays for. It seems like the public feel as if they are going to have to pay either way for projects like these.
The problem of an incentive is clearly not something Trump has thought through. I cannot think of any "honest" reasons as to why a private firm would want to help with infrastructure. A private real estate company may want to help build an intersection so the town will help them build new developments on land that was zoned or something else. Even a moral incentive along the lines of fix the road so everyone in town will know it was you and will love you is equally unrealistic and perhaps teeters on moral incentive reminiscent of communist thought. The infrastructure in the United States needs to be updated, and expanded; however, this cannot be done in the private sector.
I find it interesting how Trump's campaign promises are becoming reality. This is a prime example of this. By pushing the infrastructure onto private firms, he makes it sound like he has a plan that will not increase taxes, yet the complex long run effects of such a move are not discussed by Trump or his team. Questions regarding the underpinnings of many of Trump's early actions, are being shut down by Trump and his team in an attempt to alienate the media from the public. I have a feeling that this will become the new normal for the next 4 years.
infrastructure is something that obviously needs to be looked at and invested in as roads, bridges and especially tolls bring revenue. However, taking previously public goods and making them privatized might have some negative implications. Historically it has always been a responsibility of government to create infrastructure and I agree with Elise as there is no incentive to make private companies invest and create infrastructure without problems. It is a good idea in theory however, the problems might not outweigh the positive benefits.
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