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Should-Read: David Dayen: “Brad DeLong is wondering what happened to the Trump infrastructure policy…

Summary:
Should-Read: David Dayen: “Brad DeLong is wondering what happened to the Trump infrastructure policy… …He’s correct that the brief hope of an actual push of public money into a building boom is dead and buried. But that was never the Trump plan; it was what DeLong calls the “bunga-bunga” policy—tax breaks for public-private partnerships to give rich investors control of the commons. And while Congress could give a rip, you can see what Trump is up to by looking at the 2018 budget.Granted, it’s a fantasy document Congress has no intention of looking at. But you have to look at all the cuts to infrastructure projects in there. It completely eliminates funding for the Federal Transit Administration’s New Starts program, affecting dozens of transit initiatives. TIGER, which Transportation Secretary Elaine Chao called her “favorite program” in confirmation hearings, is also zeroed out. A funding program for rural infrastructure is gone. Part of the billion Community Development Block Grant program goes to infrastructure too. When asked about this, OMB Director Mick Mulvaney said it was intentional. The administration plans to shift that money into “more efficient infrastructure programs later on.” So not only will private equity guys get to scoop up infrastructure and put tolls on everything, they get their pick of projects that would already have had funding in place.

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…He’s correct that the brief hope of an actual push of public money into a building boom is dead and buried. But that was never the Trump plan; it was what DeLong calls the “bunga-bunga” policy—tax breaks for public-private partnerships to give rich investors control of the commons.

And while Congress could give a rip, you can see what Trump is up to by looking at the 2018 budget.Granted, it’s a fantasy document Congress has no intention of looking at. But you have to look at all the cuts to infrastructure projects in there. It completely eliminates funding for the Federal Transit Administration’s New Starts program, affecting dozens of transit initiatives. TIGER, which Transportation Secretary Elaine Chao called her “favorite program” in confirmation hearings, is also zeroed out. A funding program for rural infrastructure is gone. Part of the $3 billion Community Development Block Grant program goes to infrastructure too.

When asked about this, OMB Director Mick Mulvaney said it was intentional. The administration plans to shift that money into “more efficient infrastructure programs later on.”

So not only will private equity guys get to scoop up infrastructure and put tolls on everything, they get their pick of projects that would already have had funding in place. It’s just a bonanza.

Bradford DeLong
J. Bradford DeLong is Professor of Economics at the University of California at Berkeley and a research associate at the National Bureau of Economic Research. He was Deputy Assistant US Treasury Secretary during the Clinton Administration, where he was heavily involved in budget and trade negotiations. His role in designing the bailout of Mexico during the 1994 peso crisis placed him at the forefront of Latin America’s transformation into a region of open economies, and cemented his stature as a leading voice in economic-policy debates.

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