An Assessment of President-Elect Trump’s Infrastructure Plan

January 4, 2016

The nation needs massive infrastructure investments. But President-elect Donald Trump’s proposal is not the usual type of infrastructure construction plan. And it is a bridge-less chasm away from what we need. It would lead to privatization of our infrastructure, massive tax credits for wealthy investors, and increased costs for users and tax payers. The nation and Congress must say no to this plan.

In the Trump proposal private investors — individuals, hedge funds, investment groups and also construction companies, oil companies, cable companies, etc. — would pay upfront for an infrastructure project. Trump’s policy advisors estimate that the cost of a project would be financed by the investors’ own money (one-sixth of the total cost) and by borrowed funds (five-sixths of the total). In exchange for their equity investment, investors would receive 1) a tax credit equal to 82% of the amount they invest and 2) a 20- to 30-year lease on the project giving them the right to make money off it.

There are huge problems with this plan.

First, this is a privatization scheme. It creates all the cronyism, lack of accountability and oversight, and corruption that is typically associated with privatization.

Second, the new infrastructure would have to be structured to create a cash inflow for the investors. This means higher prices for users — think tolls on roads and bridges and higher costs for water and other utilities. If a project could not generate sufficient returns for investors, it would not be constructed.  

Third, this would be a huge giveaway of tax dollars. Projects that a corporation (say, an oil pipeline company) was already planning to construct could now be done under this plan at an enormous cost to tax payers for infrastructure that was going to be built anyway. How much additional infrastructure (on top of what companies were already planning) would be build?

Fourth, what gets done (and paid for with our tax dollars) would be what investors want to fund, the projects that could bring them the most money in fees and tolls, not necessarily the most needed projects.

Fifth, Trump is promising a streamlined approval process. What will this mean for labor and environmental regulations and community input?  

Sixth, the jobs may also be poor ones given Trump’s promises to eliminate “prevailing wage” and Davis Bacon laws that currently require federal contractors to pay an area’s prevailing wage and benefits to laborers and other workers on federal jobs.  

This is just a short list of the most obvious problems. This plan must be opposed.  We need infrastructure. But the numerous, grave defects in this proposal mean it is a plan that should be scraped.

More info
Privatization, Waste, and Unfunded Projects: The Problems with Trump’s Infrastructure Proposal from Citizens for Tax Justice 

Trump’s big infrastructure plan? It’s a trap from the Washington Post.

Trump’s Infrastructure Plan Is a Full-on Privatization Assault from The Nation.

Read more about Privatization from Justice and Witness Ministries

Why is infrastructure an issue of concern for people of faith? Read about some of the moral and environmental considerations in this series on infrastructure justice by Rev. Brooks Berndt: